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                                                                    EXHIBIT 10.1

                          SALE AND ASSIGNMENT AGREEMENT


         This Sale and Assignment Agreement (this "Agreement") is executed by
and between AMRESCO Funding Corporation, a Delaware corporation ("Assignor"),
and AMRESCO Capital Trust, a Texas real estate investment trust, and AMREIT I,
Inc., a Delaware corporation, or their designee (collectively, "Assignee"), and
is effective as of May 12, 1998 (the "Effective Date").

                                    RECITALS:

         A.       Assignor is the owner of certain loans ("Loans") and payee or
                  holder of the promissory note(s) (the "Notes") identified on
                  the attached Exhibit A and evidencing the Loans, and the
                  related mortgages and deeds of trust (collectively, the
                  "Mortgages") covering certain real property and the
                  improvements situated thereon (collectively, the "Mortgaged
                  Properties"), security agreements, guaranties, claims, and/or
                  judgments and all other related documents, instruments,
                  collateral, files, claims and other assets (collectively with
                  the Notes and Mortgages, the "Loan Documents"), evidencing,
                  securing, or otherwise related to the indebtedness of the
                  party therein listed (as maker, guarantor or otherwise,
                  hereinafter referred to as the "Borrower"). The term "Primary
                  Loan Documents," as used herein, refers to the Notes, the
                  Mortgages, and all loan agreements, guaranties and security
                  instruments included in the Loan Documents.

         B.       Assignor and Assignee have agreed that Assignor will
                  irrevocably sell, transfer and assign to Assignee all of
                  Assignor's interest in, to and under the Loans including,
                  without limitation, all of Assignor's interest in the Loans
                  Documents and all of Assignor's claims and its defenses under
                  law related thereto (to the extent such defenses are legally
                  assignable), and all "Benefits Accruing to Assignee" as
                  described in Section 15 below (collectively, the "Assigned
                  Rights"), all subject to the terms and conditions set forth
                  herein.

         NOW, THEREFORE, in consideration of the promises contained herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and intending to be legally bound hereby, the parties
hereto agree as follows:


         1.       SALE AND ASSIGNMENT; PURCHASE PRICE. Subject to the terms and
                  conditions of this Agreement:

         (a)      Assignor shall sell, transfer, assign, grant and convey unto
                  Assignee, its successors and assigns, at the Closing (as
                  defined below) the Assigned Rights, on an:



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                  "AS IS", "WHERE IS" BASIS, "WITH ALL FAULTS" AND WITHOUT
                  REPRESENTATIONS, EXPRESS OR IMPLIED, OF ANY TYPE, KIND,
                  CHARACTER OR NATURE, AND WITHOUT RECOURSE OR WARRANTIES,
                  EXPRESS OR IMPLIED, SAVE AND EXCEPT THE EXPRESS
                  REPRESENTATIONS OR WARRANTIES SET FORTH IN THIS AGREEMENT AND
                  IN DOCUMENTS TO BE DELIVERED PURSUANT TO THIS AGREEMENT.

         (b)      In full payment for the Assigned Rights, Assignee shall pay to
                  Assignor via wire transfer in accordance with the instructions
                  on Exhibit C the "Purchase Price" (herein so called), equal to
                  the sum of: (i) the outstanding principal balance of the Loans
                  as of the Closing Date, and (ii) the amount of accrued and
                  unpaid interest on the Loans as of the Closing Date, minus the
                  difference between (x) the unamortized portion of any loan
                  origination fee paid to Assignor in connection with making any
                  of the Loans, and (y) Assignor's actual costs incurred in
                  connection with making such Loan. The Purchase Price for each
                  of the Loans shall be set forth on Exhibit A-1.

         2.       CLOSING. The closing (the "Closing") of the transactions
                  contemplated by this Agreement shall take place on or before
                  May 12, 1998, at the offices of Assignor, 700 North Pearl,
                  Suite 2400, Dallas, Texas 75201, or at such other time, day or
                  place as the parties hereto may agree upon. The actual date of
                  the Closing shall be referred to as the "Closing Date".

         3.       ASSIGNOR'S CONDITIONS TO CLOSING. The obligation of Assignor
                  to sell and assign the Assigned Rights to Assignee at the
                  Closing is subject to the fulfillment to Assignor's
                  satisfaction of the following conditions prior to or at the
                  Closing:

         (a)      The representations and warranties of Assignee set forth in
                  Section 6 hereof shall be true and correct in all material
                  respects on and as of the Closing Date.

         (b)      Assignee shall have paid to Assignor the Purchase Price.

         (c)      Assignee shall provide to Assignor at or prior to Closing
                  documentation reasonably requested by Assignor to evidence
                  Assignee's authority to execute this Agreement and to
                  consummate the transactions contemplated hereby.

         (d)      To the extent applicable pre-Closing, Assignee shall have
                  complied with its covenants as set forth in Sections 8(a) and
                  (c) of this Agreement.

If Assignee fails to satisfy the conditions to Closing set forth in this Section
3, Assignor may at its option terminate this Agreement by written notice to
Assignee of its intention to terminate this Agreement, identifying therein the
condition(s) which have not been satisfied.



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         4.       ASSIGNEE'S CONDITIONS TO CLOSING. The obligation of Assignee
                  to purchase from Assignor at the Closing the Assigned Rights
                  is subject to the fulfillment to Assignee's satisfaction of
                  the following conditions prior to or at the Closing:

         (a)      Assignee's Investment Committee has approved the purchase of
                  the Assigned Rights.

         (b)      The representations and warranties of Assignor set forth in
                  Section 5 hereof shall be true and correct in all material
                  respects on and as of the Closing Date.

         (c)      Assignor shall have prepared and delivered to Assignee at the
                  Closing:

                  (i)      Duly executed and acknowledged assignments, as
                           appropriate, in the forms annexed hereto as Exhibit
                           B;

                  (ii)     A notice to each Borrower at Borrower's last known
                           address of the transaction contemplated by this
                           Agreement, duly executed by Assignor in the form
                           annexed hereto as Exhibit E, to be delivered by
                           Assignee by certified mail at the related Borrower's
                           last known address not more than fifteen (15) days
                           after the Closing Date;

                  (iii)    (A) The original executed Notes duly endorsed by
                           Assignor to Assignee as follows: "Pay to the order of
                           [AMRESCO Capital Trust] [AMREIT I, Inc.], without
                           recourse, representation or warranty except as
                           provided in that certain Sale and Assignment
                           Agreement dated May 12, 1998 executed by and between
                           AMRESCO Funding Corporation and [AMRESCO Capital
                           Trust] [AMREIT I, Inc.]";

                           (B) All other Loan Documents and other instruments or
                           documents contained in Assignor's files relating to
                           the Loan Documents, together with such other tangible
                           collateral as may be in Assignor's possession or
                           control securing the Notes;

                  (iv)     All escrow accounts and collateral accounts
                           associated with the Notes, together with assignments
                           of such accounts, agreements governing such accounts
                           and copies of ledgers or bank statements for such
                           accounts;

                  (v)      All documents reasonably deemed necessary by Assignee
                           to evidence a transfer of the security interests
                           included in the Assigned Rights, including, without
                           limitation, the appropriate assignments to be filed
                           in the respective real property records, as well as
                           the necessary forms of UCC-3 assignments, and
                           endorsements or assignments of title policies and all
                           other insurance policies, to the extent they are
                           assignable.


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         (d)      Assignor shall provide to Assignee at or prior to Closing
                  corporate resolutions, certificates of incumbency, and other
                  documentation reasonably requested by Assignee to evidence
                  Assignor's authority to execute this Agreement and to
                  consummate the transactions contemplated hereby.

         (e)      To the extent applicable pre-Closing, Assignor shall have
                  complied with its covenants as set forth in Section 7 of this
                  Agreement.

         (f)      If Assignor fails to satisfy the conditions to Closing set
                  forth in this Section 4, then Assignee may at its option
                  terminate this Agreement by written notice to Assignor of its
                  intention to terminate this Agreement, identifying therein the
                  condition(s) which have not been satisfied.

         5.       REPRESENTATIONS AND WARRANTIES OF ASSIGNOR.

         (a)      Assignor hereby represents and warrants to Assignee that:

                  (i)      (A) Assignor is a duly organized and validly
                           existing corporation under the laws of the State of
                           Delaware, continues to hold a valid certificate to
                           do business as such and has full power and authority
                           to conduct its business as such, (B) Assignor is in
                           all material respects in compliance with all laws,
                           rules, regulations, directives and published
                           interpretations issued or administered by, all
                           conditions imposed in writing by and all agreements
                           entered into with, any bank regulatory agency,
                           authority or body having jurisdiction over Assignor
                           or any of its respective assets, operations or
                           businesses, and (C) Assignor is duly authorized as a
                           foreign corporation, to do business and is in good
                           standing in all jurisdictions in which such
                           authorization or qualification is required and in
                           which the failure to be so authorized or to qualify,
                           as the case may be, could, in the aggregate, have
                           any material adverse effect upon the business,
                           condition or properties of Assignor taken as a
                           whole.

                  (ii)     Assignor has the full power and authority to hold the
                           Assigned Rights, to sell the Assigned Rights, and to
                           enter into and consummate all transactions
                           contemplated by this Agreement with respect to the
                           Assigned Rights. Assignor has duly authorized the
                           execution, delivery and performance of this
                           Agreement, has duly executed and delivered this
                           Agreement, and this Agreement, assuming due
                           authorization, execution and delivery by Assignee,
                           constitutes a legal, valid and binding obligation of
                           Assignor, enforceable against it in accordance with
                           its terms.

                  (iii)    The consummation of the transactions contemplated by
                           this Agreement is in the ordinary course of
                           Assignor's business and will not result in a breach
                           of any of the terms, conditions or provisions of
                           Assignor's charter or bylaws or any legal restriction
                           or any agreement or instrument to which Assignor is
                           now a party or by which it is bound, or constitute a
                           default or


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                           result in an acceleration under any of the foregoing,
                           or result in the violation of any law,rule,
                           regulation, order, judgment or decree to which
                           Assignor or its property is subject.

                  (iv)     Assignor is not in material default under any
                           agreement, contract, instrument or indenture to which
                           it is a party or by which it is bound, nor has any
                           event occurred that with notice or lapse of time or
                           both would constitute a material default under any
                           such agreement, contract, instrument or indenture
                           which could have a material adverse effect on this
                           Agreement or the transactions proposed hereunder.

                  (v)      There is no action, suit, proceeding or investigation
                           pending or, to Assignor's knowledge, threatened,
                           against Assignor that either individually or in the
                           aggregate, if determined adversely to Assignor, would
                           result in any material liability to Assignor, impair
                           the ability of Assignor to perform its obligations
                           hereunder in accordance with the terms hereof, or
                           have a material adverse effect on the business,
                           operations or financial condition of Assignor.

                  (vi)     No consent, approval, authorization or order of any
                           court or governmental authority, participant or other
                           third party is required for the execution and
                           delivery of this Agreement by Assignor or for the
                           performance by Assignor of its obligations hereunder,
                           other than such consent, approval, authorization or
                           order as has been or will be obtained prior to the
                           Closing.

         (b)  With respect to each Loan, Assignor hereby represents and warrants
              to Assignee that:

                  (i)      Assignor is the sole owner and holder of the Notes,
                           the Loan Documents and that there are no outstanding
                           participation interests in the Loans.

                  (ii)     The Loans are not currently subject to any prior
                           assignment or pledge which will not be released prior
                           to closing.

                  (iii)    Assignor has made available to Assignee for
                           Assignee's review originals or true copies of all
                           Loan Documents, Collateral Reports (as defined in
                           Section 10) and substantive correspondence in
                           Assignor's possession as of May 11, 1998 (the "Review
                           Date"), which directly concern the Assigned Rights
                           (including, without limitation, the Loan Documents).
                           If there have been changes to the terms of the Loans
                           since the Review Date, or if significant
                           correspondence has been received in connection with
                           the Loans since the Review Date, information
                           regarding the same has been provided to Assignee by
                           Assignor.

                  (iv)     Each of the Primary Loan Documents is valid and
                           enforceable except as such enforcement may be limited
                           by bankruptcy, insolvency, reorganization


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                           or other laws affecting the enforcement of creditors'
                           rights generally and by general equity principles
                           (regardless of whether such enforcement is considered
                           in a proceeding in equity or at law), and each
                           Mortgage, if any, grants to Assignor a security lien
                           interest in the Mortgaged Property described therein
                           with the priority identified on Exhibit A-2, subject
                           only to the security interest of the first lien
                           holder in the case of second lien mortgages and
                           standard printed exceptions to title policies,
                           mineral reservations where surface rights have been
                           waived, and utility easements or such other
                           non-monetary encumbrances described as exceptions in
                           each of the assigned title policies and such
                           exceptions, individually or collectively, will not
                           impair the use of the property for its intended
                           purpose (collectively, the "Permitted Exceptions").
                           Further, to the extent there is a Mortgage, each
                           Mortgage has created a valid lien on the respective
                           Mortgaged Property which, in the event of a material
                           default thereunder or under the related Note, may be
                           foreclosed upon in accordance with applicable state
                           law (subject to the rights of the first lienholder in
                           the case of second mortgages). Assignor has not taken
                           any action that creates any valid defense in
                           accordance with applicable state law by the obligor
                           thereunder to the holder's realization on the
                           collateral or the indebtedness.

                  (v)      Assignor has not received notice of pending or
                           threatened litigation (including bankruptcies and tax
                           suits) which may materially affect the validity or
                           enforceability of the Loan Documents or the valuation
                           of the Mortgaged Properties.

                  (vi)     The Notes are legal, valid and binding obligations
                           of the maker or obligor thereof, enforceable against
                           such maker or obligor in accordance with their terms
                           except as such enforcement may be limited by
                           bankruptcy, insolvency, reorganization or other laws
                           affecting the enforcement of creditors' rights
                           generally and by general equity principles
                           (regardless of whether such enforcement is
                           considered in a proceeding in equity or at law) and
                           Assignor has not taken any enforcement action under
                           any security agreements or the other related Loan
                           Documents that creates any valid defense in
                           accordance with applicable state law by the maker
                           thereunder to the holder's realization on such
                           security.

                  (vii)    The legal principal balances for each Note as set
                           forth on Exhibit A-2 attached hereto are true and
                           correct as of May 11, 1998 (the "Cut-Off Date") and
                           the legal principal balances as set forth on the
                           Certificate of Principal Balances (as described in
                           Section 7(d) hereof) will be true and correct as of
                           the last business day before Closing.

                  (viii)   Ad valorem and other property taxes for the Mortgaged
                           Properties are current, and there are no material
                           delinquencies. For purposes of this Section
                           5(b)(viii), the term "material" shall refer to
                           delinquencies in excess


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                           of $50,000 or 5% of the principal balance of the
                           related Loan, whichever is less.

                  (ix)     All Loan Documents have been made available for
                           review by Assignee, and will continue to be updated
                           and available for review between the Effective Date
                           of this Agreement and the Closing Date. To the best
                           of Assignor's knowledge and belief, there are no
                           material Loan Documents which are not in its
                           possession.

                  (x)      Assignor has made available for review by Assignee
                           (and will continue to update such information as it
                           is received and shall provide to Assignee such
                           updated information that is received by Assignor
                           prior to the Closing Date of this Agreement)
                           (collectively, "Environmental Material") all written
                           materials in its possession regarding (i) compliance
                           by each Mortgaged Property and/or the applicable
                           Borrower with all Environmental Requirements (as
                           defined in Section 9 below), (ii) the presence of
                           any Hazardous Materials (as defined in Section 9
                           below) located on or affecting any of the Mortgaged
                           Properties, and (iii) the failure to remediate, or
                           failure to have taken such steps as may have been
                           required as of the Effective Date by any
                           governmental authority with jurisdiction over the
                           Borrower or Mortgaged Property. Assignor has no
                           actual knowledge of any breach of any Environmental
                           Requirements or the existence of any Hazardous
                           Materials on or affecting the Mortgaged Properties
                           not described in the Environmental Material. Any
                           breach of this Section 5(b)(x) shall be referred to
                           herein as an "Environmental Defect."

                  (xi)     To the actual knowledge of Assignor, as of the date
                           of the Prospectus for 9,000,000 common shares of
                           beneficial interest in AMRESCO Capital Trust dated
                           May 6, 1998 (the "Prospectus"), the descriptions of
                           each Loan contained in the Prospectus do not contain
                           any material misstatements of fact or omit to state a
                           material fact known to Assignor concerning such
                           Loans.

                  (xii)    Assignor has not foreclosed upon or otherwise
                           realized upon or received any property securing the
                           Notes and will not take any such actions prior to the
                           Closing without Assignee's prior written consent.

         6.       REPRESENTATIONS AND WARRANTIES OF ASSIGNEE. Assignee hereby
                  represents and warrants to Assignor that:

         (a)      Assignee has all requisite power and authority to execute and
                  deliver, and to perform all of its obligations under, this
                  Agreement and all instruments and other documents executed and
                  delivered by Assignee in connection herewith.



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         (b)      The execution, delivery and performance of this Agreement has
                  been duly authorized by all necessary action on the part of
                  Assignee and does not require any consent or approval of any
                  party that has not been obtained.

         (c)      Assignee is acquiring the Assigned Rights for its own account
                  and not with a view toward any public sale or distribution
                  thereof and Assignee does not intend to sell, offer for sale
                  or syndicate the Assigned Rights or fractional interests in
                  Assignee in connection with the purchase of the Assigned
                  Rights; provided, however, nothing herein shall be construed
                  or applied to prohibit or otherwise limit Assignee's right to
                  dispose of all or any portion of Assignee's interest in the
                  Assigned Rights in compliance with all applicable laws.

         (d)      Assignee has such knowledge and experience in financial and
                  business matters and is capable of evaluating the merits and
                  risks relating to its purchase of the Assigned Rights
                  (including, without limitation, any environmental laws
                  pertaining to the Mortgaged Properties) and making an informed
                  purchase and investment decision in connection therewith.

         (e)      Assignee acknowledges that the Assigned Rights will have
                  limited liquidity and Assignee has the financial wherewithal
                  to hold the Assigned Rights for an indefinite period of time
                  and to bear the economic risk of an outright purchase of the
                  Assigned Rights.

         (f)      Assignee has agreed to the Purchase Price on the basis of its
                  own independent investigation and credit evaluation of the
                  Assigned Rights. Assignee has not relied upon any
                  representations, warranties or statements of any kind made by
                  or on behalf of Assignor except for those representations,
                  warranties and statements set forth in this Agreement.
                  Assignee acknowledges that, except for the representations and
                  warranties of Assignor set forth in, or to be made in
                  instruments delivered pursuant to this Agreement, Assignor
                  negates and disclaims all representations, warranties and
                  statements of every kind or type (express or implied).
                  Assignee further acknowledges that the amount ultimately
                  received by Assignee in respect of the Assigned Rights may be
                  less than the Purchase Price, and Assignee shall have no
                  recourse to Assignor for any such deficiency.

         Nothing in this Section 6 shall constitute a waiver or modification of
         Assignor's representations and warranties as set forth in this
         Agreement, nor shall Assignee's remedies for breach of such
         representations and warranties as set forth in Section 13 of this
         Agreement be hereby waived or modified.

         7.       COVENANTS OF ASSIGNOR.

         (a)      Assignor shall use its reasonable efforts to satisfy each of
                  the conditions to closing set forth in Section 3 hereof.



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         (b)      Assignor shall notify Assignee promptly if any of the
                  representations set forth in Section 5 hereof shall become
                  inaccurate prior to the Closing Date or if any of such
                  representations is discovered to be inaccurate prior to the
                  Closing Date.

         (c)      Assignor and Assignor's counsel shall cooperate with Assignee
                  and Assignee's counsel in the defense of any claims or
                  counterclaims made against Assignee, or any of Assignee's
                  subsidiaries, affiliates, employees, officers, directors,
                  shareholders, agents, representatives, attorneys, accountants
                  or consultants, in any litigation, arbitration proceeding or
                  other forum involving or relating to the Assigned Rights.
                  Assignor's obligations under this Section 7(c) shall not be
                  construed to require Assignor to expend any significant funds
                  or incur any material costs for which it is not reimbursed in
                  connection with such cooperation, and Assignee shall reimburse
                  Assignor for the reasonable costs of Assignor's employees
                  involved in supplying Assignee or Assignee's counsel with
                  copies of documents and other information as may be reasonably
                  required by Assignee or Assignee's counsel in preparing for
                  depositions or trial. For purposes of this Section 7(c) and
                  Section 8(d) below, "significant funds or...material costs"
                  shall mean costs, fees or expenses in excess of $1,000 per
                  lawsuit, arbitrated matter or other legal proceeding. This
                  provision is in addition to, and not in lieu of, the
                  indemnification of Assignee by Assignor contained in Section
                  12 hereof.

         (d)      As soon as practical after the Effective Date of this
                  Agreement, but in no event later than five (5) Business Days
                  thereafter, Assignor shall provide to Assignee a description
                  of all Notes listed on Exhibit A hereto in the form attached
                  as Exhibit A-2, giving the name of the Borrower(s), the date
                  of the Note, the original principal balance of the Note, and
                  the outstanding principal balance of the Note as of the
                  Cut-off Date. At Closing, Assignor shall provide Assignee with
                  a Certificate of Principal Balances in the form of Exhibit D
                  attached hereto; Schedule I to that Certificate of Principal
                  Balances shall include the information set forth in the list
                  described in the first sentence of this Section 7(d), plus the
                  principal balances on the Notes as of the last business day
                  before Closing.

         (e)      If there are letters of credit held as collateral for the
                  Notes or other obligations under the Loan Documents which are
                  not assignable, Assignor will cooperate fully with Assignee to
                  make presentment of or demand on such letters of credit or
                  other collateral. Such cooperation shall include, without
                  limitation, execution of notices, affidavits, or other notices
                  required for presentation of the letter of credit, actual
                  presentation of the letter of credit for funding, immediate
                  transfer of funds or endorsement and delivery of a check to
                  Assignee, and filing and vigorous prosecution of litigation
                  (at Assignee's expense) to obtain the proceeds of the
                  collateral letter of credit.

         (f)      Between the Effective Date of this Agreement and the Closing
                  Date (the "Interim Period"), Assignor will service the Loans
                  in a prudent fashion, including, without limitation,
                  maintaining or causing to be maintained customary amounts and
                  types of casualty insurance with respect to the Mortgaged
                  Properties. During the Interim


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                  Period, Assignor shall not modify or extend the terms of the
                  Loans, fund previously unfunded commitments, or release any
                  collateral securing or obligors upon such Notes, unless
                  legally obligated to do so. There have been no restructurings
                  of the Notes or the Loans they evidence since the Cut-Off
                  Date.

         8.       COVENANTS OF ASSIGNEE.

         (a)      Assignee shall use its reasonable efforts to satisfy each of
                  the conditions to closing set forth in Section 4 hereof.

         (b)      Within fifteen (15) days after Closing, Assignee shall deposit
                  in the U.S. Mail, return receipt requested, all notices to
                  Borrower delivered to Assignee pursuant to Section 4(c)(ii)
                  hereof.

         (c)      Assignee shall notify Assignor promptly if any of the
                  representations set forth in Section 6 hereof shall become
                  inaccurate prior to the Closing Date or if any such
                  representation is discovered to be inaccurate prior to the
                  Closing Date.

         (d)      Assignee and Assignee's counsel shall cooperate with Assignor
                  and Assignor's counsel in the defense of any claims or
                  counterclaims made against Assignor, or any of Assignor's
                  subsidiaries, affiliates, employees, officers, directors,
                  shareholders, agencies, representatives, attorneys,
                  accountants or consultants, in any litigation, arbitration
                  proceeding or other forum involving or relating to the
                  Assigned Rights. Assignee's obligations under this Section
                  8(d) shall not be construed to require Assignee to expend any
                  significant funds or incur any material costs (as defined in
                  Section 7(c) hereof) for which it is not reimbursed in
                  connection with such cooperation and Assignor shall reimburse
                  to Assignee the reasonable costs of Assignee's employees
                  involved in supplying Assignor or Assignor's counsel with
                  copies of documents and other information as may be reasonably
                  required by Assignor or Assignor's counsel in preparing for
                  depositions or trial. This provision is in addition to, and
                  not in lieu of, the indemnification of Assignor by Assignee
                  contained in Section 11 hereof.

         (e)      Assignee hereby agrees to be expressly bound by the terms of
                  each Loan and the Loan Documents executed in connection
                  therewith and hereby assumes and covenants to perform all
                  obligations by Assignor thereunder, including but not limited
                  to, any obligation to fund any future advances of principal
                  and/or interest required under the terms of the Loan
                  Documents. The agreement contained in this subsection (e)
                  shall be in full force and effect at the time that Closing has
                  occurred.

         9.       ENVIRONMENTAL ISSUES. For purposes of this Agreement, the term
                  "Hazardous Materials" shall mean any substance which is or
                  contains: (i) any "hazardous substance" as now or hereafter
                  defined in Section 101(14) of the Comprehensive Environmental
                  Response, Compensation, and Liability Act of 1980, as amended
                  (42 U.S.C. Section 9601 et seq.) ("CERCLA") or any regulations


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                  promulgated under CERCLA; (ii) any "hazardous waste" as now or
                  hereafter defined in the Resource Conservation and Recovery
                  Act (42 U.S.C. Section 6901 et seq.) ("RCRA") or regulations
                  promulgated under RCRA; (iii) any substance regulated by the
                  Toxic Substances Control Act (15 U.S.C. Section 2601 et seq.);
                  (iv) gasoline, diesel fuel, or other petroleum hydrocarbons;
                  (v) asbestos and asbestos containing materials, in any form,
                  whether friable or non-friable; (vi) polychlorinated
                  biphenyls; (vii) radon gas; and (viii) any additional
                  substances or materials which are now or hereafter classified
                  or considered to be hazardous or toxic under Environmental
                  Requirements (as hereinafter defined) or the common law, or
                  any other applicable laws relating to the Mortgaged
                  Properties. Hazardous Materials shall include, without
                  limitation, any substance, the presence of which on the
                  Mortgaged Properties, (A) requires reporting, investigation or
                  remediation under Environmental Requirements; (B) causes or
                  threatens to cause a nuisance on the Mortgaged Properties or
                  adjacent property or poses or threatens to pose a hazard to
                  the health or safety of persons on the Mortgaged Properties or
                  adjacent property; or (C) which, if it emanated or migrated
                  from the Mortgaged Properties, could constitute a trespass.

For purposes of this Agreement, the term "Environmental Requirements" shall mean
all laws, ordinances, statutes, codes, rules, regulations, agreements,
judgments, orders, and decrees, now or hereafter enacted, promulgated, or
amended, of the United States, the states, the counties, the cities, or any
other political subdivisions in which the Mortgaged Properties are located, and
any other political subdivision, agency or instrumentality exercising
jurisdiction over the owner of the Mortgaged Properties, the Mortgaged
Properties, or the use of the Mortgaged Properties, relating to pollution, the
protection or regulation of human health, natural resources, or the environment,
or the emission, discharge, release or threatened release of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or waste
or Hazardous Materials into the environment (including, without limitation,
ambient air, surface water, groundwater, land or soil).

         10.      COLLATERAL REPORTS. To the extent they are available, Assignor
                  will provide Assignee with all title reports, file reviews,
                  environmental site assessments, inspection reports, surveys,
                  engineering reports, and/or appraisals in Assignor's
                  possession or control relating to the Mortgaged Properties
                  (collectively, the "Collateral Report(s)"). The Collateral
                  Reports may have been prepared by Assignor, its predecessors
                  in interest, or third party contractors. ASSIGNEE UNDERSTANDS
                  AND ACKNOWLEDGES THAT ANY COLLATERAL REPORT WHICH MAY BE
                  PROVIDED BY ASSIGNOR OR ITS EMPLOYEES, AGENTS, CONTRACTORS AND
                  REPRESENTATIVES IS BEING PROVIDED WITHOUT REPRESENTATION OR
                  WARRANTY AS TO THE COMPLETENESS OR ACCURACY OF THE FACTS,
                  PRESUMPTIONS AND CONCLUSIONS CONTAINED THEREIN, AND ASSIGNEE
                  SHALL NOT RELY ON SAME TO ASSIGNEE'S DETRIMENT IN CLOSING THE
                  TRANSACTION CONTEMPLATED HEREBY. ASSIGNEE HAS BEEN EXPRESSLY
                  ADVISED BY ASSIGNOR TO CONDUCT AN INDEPENDENT INVESTIGATION IN
                  RESPECT TO THE IDENTIFICATION OF THE MORTGAGED PROPERTY, ITS
                  VALUE OR


                                                                         Page 11
<PAGE>   12



                  CONDITION, AND ITS LIEN PRIORITY OR PERFECTION. Nothing in
                  this Section 10 shall diminish or affect the representations
                  and warranties set forth in Section 5 hereof.

         11.      ASSIGNEE'S INDEMNITIES. Assignee agrees to indemnify and hold
                  harmless Assignor, its subsidiaries, affiliates, officers,
                  directors, shareholders, employees, agents, representatives
                  and attorneys, from and against any and all loss, liability,
                  claim, damage and expense whatsoever (including attorneys'
                  fees) directly or indirectly arising out of, based upon,
                  resulting from or otherwise relating to (a) any act or
                  omission of Assignee or any of its representatives after the
                  Closing Date, which constitutes negligence or wilful
                  misconduct, in connection with the Loan Documents, the
                  Assigned Rights or otherwise, (b) the failure to make any
                  advance of principal or interest on a Loan after the Closing
                  Date that was required to be made after the Closing Date (but
                  not as to any such advance that, pursuant to the terms of the
                  applicable Loan Documents, was required to be made on or
                  before the Closing Date), (c) the material inaccuracy of any
                  of Assignee's representations or warranties contained in
                  Section 6, (d) the material breach of any of Assignee's
                  covenants herein, (e) any commissions, finder's fees or
                  similar fees due or claimed by any broker, agent or
                  salesperson claimed directly against Assignor as a result of
                  an agreement entered into by Assignee, or (f) actions taken by
                  Assignor which are specifically requested by Assignee under
                  Section 7(e) hereof.

         12.      ASSIGNOR'S INDEMNITIES. Assignor agrees to indemnify and hold
                  harmless Assignee, its subsidiaries, affiliates, officers,
                  directors, shareholders, employees, agents, representatives
                  and attorneys, from and against any and all loss, liability,
                  claim, damage and expense whatsoever (including attorneys'
                  fees) directly or indirectly arising out of, based upon,
                  resulting from or otherwise relating to (a) any act or
                  omission of Assignor or any of its representatives, which
                  constitutes negligence or willful misconduct, in connection
                  with the Loan Documents, the Assigned Rights or otherwise,
                  including, but not limited to, any action taken by it in
                  connection with any Loan Document which gives rise to a valid
                  third party claim for damages (and not solely a defense to
                  payment of the note which was not caused by any action on the
                  part of Assignor), (b) the failure to make any advance of
                  principal on or before the Closing Date that was required to
                  be made on a Loan on or before the Closing Date (but not as to
                  any such advance that, pursuant to the terms of the applicable
                  Loan Documents, was required to be made after the Closing
                  Date), (c) the material inaccuracy of any of Assignor's
                  representations or warranties contained in Section 5, (d) the
                  material breach of any of Assignor's covenants herein, and (e)
                  any commissions, finder's fees or similar fees due or claimed
                  by any broker, agent or salesperson claimed directly against
                  Assignee as a result of an agreement entered into by Assignor.



                                                                         Page 12
<PAGE>   13


         13.      CONDITIONAL PRICE ADJUSTMENT OR REPURCHASE BY THE ASSIGNOR 
                  AFTER TRANSFER DATE.

         (a)      Assignee's Conditional Right to Require Assignor to
                  Repurchase. Upon discovery by Assignor or Assignee of a breach
                  of any of Assignor's representations and warranties, as set
                  forth in Section 5 hereof, the party discovering such breach
                  shall give prompt written notice to the other. Such notice
                  shall include documentary evidence establishing the existence
                  of a breach of a representation or warranty by Assignor. Upon
                  such discovery and sending of notice of such material breach
                  of a representation or warranty, Assignor shall have the right
                  to cure such breach in all material respects within thirty
                  (30) days of Assignor's receipt of the notice (or within one
                  hundred and eighty (180) days of such notification if a breach
                  of Section 5(b)(x) and Assignor commences such cure within
                  thirty (30) days of such notification and diligently pursues
                  such cure thereafter) and, if such breach cannot be cured
                  within thirty (30) days of Assignee's notification to Assignor
                  (or within the above described 180-day cure period, if
                  applicable), then Assignee may, at its option, by written
                  notice to Assignor, require Assignor to repurchase such Note
                  and the related Loan Documents from Assignee, on a whole
                  asset, servicing-released basis as provided herein. Such
                  notice from Assignee must be delivered not later than thirty
                  (30) days from the expiration of the 30-day cure period (or
                  180-day cure period, if applicable) or receipt of written
                  notice from Assignor to Assignee that Assignor is unable to
                  cure the breach of representation or warranty, whichever is
                  earlier. If the breach is an error in the Purchase Price of a
                  Loan of less than 2%, it may be cured by Assignor paying
                  Assignee the excess Purchase Price together with its interest
                  thereon at 12% per annum.

         (b)      Repurchase Price. The repurchase price of any Note(s) shall be
                  determined as follows: the Purchase Price allocated to the
                  particular Note(s) (as reflected on Exhibit A-1), plus (a) the
                  amount of principal and any interest accrued since the Closing
                  Date advanced by Assignee pursuant to the requirements set
                  forth in the Loan Documents and any interest accrued since the
                  Closing Date, (b) the amount of ad valorem taxes and property
                  insurance premiums which have become due and which are paid by
                  Assignee, (c) other protective advances, not to exceed $25,000
                  per asset, and (d) any other expenses incurred by Assignee in
                  administration or collection of such Loan (including, but not
                  limited to, expenses for title reports, environmental site
                  assessments, appraisals, attorneys fees'), less (x) the amount
                  of any payments or other consideration received by Assignee
                  from the Borrowers or other obligors on the repurchased Loans
                  or from proceeds of any collateral for the Loans, and (y) the
                  remaining unamortized portion of any loan origination fee paid
                  in connection with the origination of such repurchased Loans.
                  The repurchase price shall be paid to Assignee within three
                  (3) days after Assignor's receipt of the documents and
                  instruments required to be delivered pursuant to Section 13(d)
                  or, at Assignee's option, the repurchase may be closed through
                  an escrow.

         (c)      Duration of Assignor's Obligation to Repurchase. Assignor's
                  obligation to repurchase any Loan pursuant to Section 13(a)
                  shall terminate automatically, with respect to that particular
                  Loan, unless Assignee notifies Assignor in writing that a
                  condition allowing Assignee to require Assignor to repurchase
                  such Loan has


                                                                         Page 13
<PAGE>   14



                  occurred, which notice must be delivered prior to the first of
                  the following to occur:

                           (1)      The terms of the Loan are substantively
                                    modified by a written or oral agreement
                                    between Assignee and Borrower.

                           (2)      Assignee obtains full payment on the Note
                                    from Borrower or any guarantor or surety
                                    therefor, or otherwise accepts a partial
                                    payment thereof in full satisfaction of the
                                    debt evidenced thereby.

                           (3)      The Borrower or other significant obligor
                                    liable for payment of the Note is released
                                    by Assignee.

                           (4)      In the case of a Loan being repurchased
                                    because of an Environmental Defect, Assignee
                                    has taken steps to control the Mortgaged
                                    Property or the property owner so that the
                                    "secured lender" exception for environmental
                                    liability has been effectively waived.

         (d)      Transfer of Loan/Delivery of Loan Files. Assignee shall,
                  within ten (10) days after delivering written notice to
                  Assignor confirming that Assignee is exercising its option to
                  require repurchase of a Loan or Loans by Assignor hereunder,
                  deliver to Assignor all originals and copies of the Note(s)
                  and any other Loan Documents, Collateral Report(s) and related
                  files and any other transfer documents or other documents that
                  were delivered to Assignee pursuant to this Agreement
                  regarding such Loan(s), together with any addenda, exhibits
                  and schedules thereto. With respect to each such Loan,
                  Assignee shall endorse, transfer, convey or assign to Assignor
                  the Note and the Loan Documents in the same manner as such
                  Note and the associated Loan Documents were transferred and
                  assigned from Assignor to Assignee by documentation in the
                  same form as that delivered from Assignor to Assignee
                  (provided that Assignee shall not be required to make any
                  representation other than that the events set forth in
                  Sections 13(c)(1) - (4) have not occurred and representations
                  corresponding to those of Assignor in Section 5(b)(i), (ii)
                  and (iv)). Simultaneously with Assignee's delivery of such
                  documents to Assignor, Assignor shall pay to Assignee the
                  Repurchase Price in the form of a wire transfer, a cashier's
                  check or certified check drawn upon an institution acceptable
                  to Assignee in its sole and absolute discretion. After
                  repurchase hereunder, Assignee shall immediately endorse,
                  assign over and deliver to Assignor any and all payments
                  received from or on behalf of any obligor on the repurchased
                  Loan. All amounts paid over to Assignor hereunder shall be
                  without payment of interest thereon. Upon repurchase of any
                  Loan, Assignee agrees to immediately terminate, at its sole
                  cost, the applications of any servicing agreement with respect
                  to the Loan repurchased. If either party fails to comply with
                  the terms of this Section 13, the other party shall have the
                  right to enforce the provisions hereof by appropriate legal
                  means and, in connection therewith, the defaulting party shall
                  be responsible for payment of all of the prevailing party's
                  costs and expenses (including, without




                                                                         Page 14
<PAGE>   15



                  limitation, attorneys' fees and costs) incurred by the
                  prevailing party in such enforcement.

         (e)      Sole Remedy. Except as set forth in Section 12 and Section
                  13(a) hereof, the right of Assignee to cause Assignor to
                  repurchase the Loan(s) shall be Assignee's sole remedy for
                  Assignor's breach of warranties and representations contained
                  in Section 5 hereof.

         14.      LIMITATION OR DAMAGES. Also, Assignor and Assignee each hereby
                  agree that any claim they may have hereunder for damages shall
                  be limited to actual damages and each hereby waives the right
                  to claim or receive consequential, punitive, special or
                  incidental damages in connection with any claim arising out of
                  or related to this Agreement.

         15.      FURTHER COVENANTS.

         (a)      (i)      For purposes of this Agreement, the following terms 
                           shall have the following meanings:

                           (A)      "BENEFITS ACCRUING TO ASSIGNOR" shall mean
                                    with respect to the Loans, all principal and
                                    interest payments received before the close
                                    of business on the day before the Closing
                                    Date.

                           (B)      "BENEFITS ACCRUING TO ASSIGNEE" shall mean
                                    with respect to the Loans, all principal and
                                    interest payments received on or after the
                                    Closing Date.

                  (ii)     If Assignor shall receive any rents or payments of
                           interest and/or principal on the Notes or other
                           consideration distributed or paid by Borrower or its
                           affiliates which represent "Benefits Accruing to
                           Assignee", and provided the Closing occurs in
                           accordance with the terms and conditions
                           contemplated herein, Assignor shall accept such
                           payments or other consideration as Assignee's agent
                           and hold the same on behalf of and for the benefit
                           of Assignee, and shall remit (within five (5)
                           Business Days) the same following the Closing to
                           Assignee with the endorsement (without recourse,
                           representation or warranty) of Assignor when
                           necessary or appropriate.

         (b)      The terms of the transactions contemplated in this Agreement,
                  including, without limitation, the Purchase Price and all
                  other financial terms, shall remain confidential and shall not
                  be disclosed by either party hereto without the written
                  consent of the other except as otherwise required by law or
                  regulation.

         (c)      Assignor shall pay all fees and expenses (including, without
                  limitation, legal, accounting or investment banking fees and
                  expenses) incurred by it in connection with this Agreement and
                  the transactions contemplated hereby. Assignee shall pay



                                                                       Page 15

<PAGE>   16



                  all fees and expenses (including, without limitation, legal,
                  accounting or investment banking fees and expenses) incurred
                  by it in connection with this Agreement and the transactions
                  contemplated hereby. All recording fees and documentary taxes
                  necessitated by the assignment of the Assigned Rights to
                  Assignee shall be borne and paid by Assignee (unless specific
                  state law requires the seller or assignor to pay said fees or
                  taxes).

         16.      OCCURRENCE OF CERTAIN EVENTS PRIOR TO CLOSING. Until Closing,
                  all risk of loss for the Loans shall be borne by Assignor and
                  any insurance, condemnation or other proceeds paid or payable
                  for such losses shall be either delivered or assigned to
                  Assignor at Closing, as appropriate.

         17.      LITIGATION IN NAME OF ASSIGNOR. Assignee shall not, without
                  the express prior written consent of Assignor (which consent
                  may be withheld in Assignor's discretion), institute any legal
                  action in the name of Assignor or continue to prosecute in the
                  name of Assignor any pending legal action. Assignee shall not
                  mislead or conceal from any person the identity of the owner
                  of the Assigned Rights purchased hereunder.

         18.      SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS. The
                  representations, warranties and covenants of the parties
                  contained herein shall survive the consummation of the
                  transactions contemplated in this Agreement, subject to any
                  time period limitations specified herein.

         19.      FURTHER ASSURANCES. Assignor and Assignee shall each execute
                  and deliver to the other all further documents or instruments
                  reasonably requested by either of them in order to effect the
                  intent of this Agreement and to obtain the full benefit of
                  this Agreement. Any request by either party under this Section
                  19 shall be accompanied by the document proposed for signature
                  by the party requesting it, in form and substance satisfactory
                  to the party of whom the request is made and its attorneys.
                  The party making the request shall bear and discharge any fees
                  or expenses incident to the preparation, filing or recording
                  of documents requested pursuant to this Section 19.

         20.      GOVERNING LAW. This Agreement shall be governed by and
                  interpreted in accordance with federal law. To the extent not
                  controlled by federal law, this Agreement shall be governed by
                  and construed and enforced in accordance with the laws of the
                  State of Texas without reference to conflicts of law
                  principles.

         21.      ENTIRE AGREEMENT. THIS WRITTEN AGREEMENT REPRESENTS THE FINAL
                  AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
                  EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
                  AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
                  AGREEMENTS BETWEEN THE PARTIES. The parties make no
                  representations or warranties to each other, except as
                  contained in this Agreement or in the accompanying exhibits or
                  the certificates or other



                                                                       Page 16

<PAGE>   17



                  closing documents delivered according to this Agreement. All
                  prior agreements and understandings between the parties hereto
                  with respect to the transactions contemplated hereby, whether
                  verbal or in writing, are superseded by, and are deemed to
                  have been merged into, this Agreement unless otherwise
                  expressly provided herein. This Agreement shall be binding on,
                  and inure to the benefit of, the parties hereto and their
                  successors and assigns, but no other party shall have or claim
                  any third party beneficiary rights under this Agreement.
                  Neither party hereto has engaged any broker or finder or
                  incurred or become obligated to pay any broker's commission or
                  finder's fee in connection with the transactions contemplated
                  by this Agreement.

         22.      MODIFICATIONS. This Agreement may not be changed, waived,
                  discharged or terminated orally, but only by an instrument in
                  writing signed by the party against which enforcement of such
                  change, waiver, discharge or termination is sought.

         23.      SEVERABILITY. If any provision of this Agreement shall be
                  determined to be invalid, illegal or unenforceable, the
                  balance of this Agreement shall remain in full force and
                  effect and if any provision is inapplicable to any person of
                  circumstance, it shall nevertheless remain applicable to all
                  other persons and circumstances.

         24.      ASSIGNMENT. This Agreement may be assigned by Assignee to any
                  affiliate or subsidiary thereof. Assignee shall immediately
                  give Assignor written notice of such assignment. The term
                  "affiliate" as used herein shall include, without limitation,
                  any partnership (general or limited) in which Assignee or
                  Assignee's general partner has an interest.

         25.      NOTICES. All notices between the parties shall be in writing
                  and shall be served either personally, by certified mail,
                  facsimile (followed by overnight courier) or overnight courier
                  services. If served personally or by facsimile, notice shall
                  be deemed given or made at the time of such service. If served
                  by certified mail, notice shall be deemed given and made five
                  (5) business days after the deposit thereof in the United
                  States mail, postage prepaid, addressed to the party to whom
                  said notice is to be given or made. If served by an overnight
                  courier service promising delivery not later than 10:00 a.m.
                  on the first business day after receipt by such service,
                  notice shall be deemed given and made one business day after
                  the deposit thereof with such courier service, addressed to
                  the party to whom such notice is to be given or made, if such
                  deposit is timely and appropriate in accordance with the
                  requirements of such courier service.



                                                                       Page 17

<PAGE>   18



All notices to Assignor shall be given to it at:

                  AMRESCO Funding Corporation
                  700 North Pearl Street
                  Suite 2400, LB 342
                  Dallas, Texas  75201
                  Attention:  Joey Howell, Esq.
                  Fax No.:  (214) 953-7757

         With copies to:

                  AMRESCO, INC.
                  700 North Pearl Street
                  Suite 2400, LB #342
                  Dallas, TX  75201
                  Attention:  General Counsel
                  Fax No.:  (214) 953-7757

All notices to Assignee shall be given to it at:

                  AMRESCO Capital Trust
                  AMREIT I, Inc.
                  700 North Pearl Street
                  Suite 2400, LB #342
                  Dallas, TX  75201
                  Attention:  Michael L. McCoy, Esq.
                  Fax No.:  (214) 953-7757

         26.      REFERENCES IN THIS AGREEMENT. Whenever the context of this
                  Agreement requires, references to the singular number shall
                  include the plural, and the plural shall include the singular,
                  where appropriate; words denoting gender shall be construed to
                  include the masculine, feminine and neuter where appropriate;
                  and specific enumeration shall not exclude the general, but
                  shall be considered as cumulative. For purposes of this
                  Agreement, the term "Business Days" shall mean any day other
                  than a Saturday, Sunday or national holiday recognized by
                  federally chartered banks.

         27.      JURISDICTION AND VENUE; WAIVER OF JURY TRIAL; MEDIATION.
                  Assignee and Assignor hereby consent to the jurisdiction of
                  any state or federal court located within Dallas County,
                  Texas, waive personal service of any and all process upon
                  them, consent to service of process by registered mail
                  directed to the defendant party at the address stated in
                  Section 25 above, and acknowledges that service so made shall
                  be deemed to be completed upon actual receipt thereof. In
                  addition, Assignee and Assignor consent and agree that venue
                  of any action instituted under this Agreement shall be proper
                  in Dallas County, Texas, and hereby waive any objection to
                  venue. This Agreement is and shall be performed



                                                                       Page 18

<PAGE>   19



                  in Dallas County, Texas. Both Assignor and Assignee waive any
                  rights they may have to a jury trial for disputes arising
                  hereunder, and both parties agree to submit any disputes
                  hereunder to non-binding mediation prior to the institution of
                  a lawsuit.

         28.      COUNTERPARTS. This Agreement and any amendment hereto may be
                  executed in two or more counterparts, each of which shall be
                  deemed an original, but all of which together shall constitute
                  one and the same instrument.

         29.      ACCESS TO FILES AND RECORDS. From and after the Closing Date,
                  Assignee shall permit Assignor or Assignor's designee access
                  to the Loan Documents during normal business hours (with
                  reasonable prior written notice) delivered with respect to
                  this Agreement.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]





                                                                       Page 19

<PAGE>   20



         IN WITNESS WHEREOF, the undersigned have duly executed this Sale and
Assignment Agreement effective as of the date first above written.


                                            AMRESCO FUNDING CORPORATION


Date: May 12, 1998                          By: /s/ RHONDA LINDSEY
                                                --------------------------------
                                            Printed Name: Rhonda Lindsey
                                                         -----------------------
                                            Title:  Vice President
                                                   -----------------------------


                                            AMRESCO CAPITAL TRUST


Date: May 12, 1998                          By: /s/ MICHAEL L. MCCOY
                                                --------------------------------
                                            Printed Name: Michael L. McCoy
                                                         -----------------------
                                            Title: Senior Vice President
                                                   -----------------------------

                                            AMREIT I, INC.


Date: May 12, 1998                          By: /s/ MICHAEL L. MCCOY
                                                --------------------------------
                                            Printed Name: Michael L. McCoy
                                                         -----------------------
                                            Title:  Senior Vice President
                                                   -----------------------------



                                                                         Page 20
<PAGE>   21


                                   EXHIBIT A-1

                                 PURCHASE PRICE

<TABLE>
<CAPTION>


--------------------------------------------------------------------------------------------------------------------------------
Note #         Borrower            Principal Balance     Accrued    Unamortized Origination  Origination Costs  Purchase Price
                                                        Interest              Fee
--------------------------------------------------------------------------------------------------------------------------------
<S>     <C>                        <C>                <C>           <C>                      <C>                <C>
1.      Collins Crossing Ltd.              $0.00           $0.00            $49,000.00               $0.00        ($49,000.00)
--------------------------------------------------------------------------------------------------------------------------------
2.      Collins Crossing Ltd.          $1,000.00          $14.19           $245,000.00               $0.00       ($243,985.81)
--------------------------------------------------------------------------------------------------------------------------------
3.      Benton Columbus Partners,  $5,838,667.62      $22,122.25           $134,671.70               $0.00       $5,726,118.17
        L.P.
---------------------------------------------------------------------------------------------------------------------------------
                                                                                   TOTAL PURCHASE PRICE          $5,433,132.36

</TABLE>



                                    EXHIBIT A
                                    Solo Page




<PAGE>   22



                                   EXHIBIT A-2

                                LOAN DESCRIPTIONS

<TABLE>
<CAPTION>


-----------------------------------------------------------------------------------------------------
Note #        Borrower         Origination  Original Principal  Principal Balance as of Cut-
                                  Date           Balance               Off Date
-----------------------------------------------------------------------------------------------------
<S>     <C>                    <C>          <C>                 <C>
1.      Collins Crossing, Ltd.   3/30/98      $2,450,000.00                           $0.00




-----------------------------------------------------------------------------------------------------
2.      Collins Crossing, Ltd.   3/30/98     $12,250,000.00                       $1,000.00




-----------------------------------------------------------------------------------------------------
3.      Benton Columbus          2/20/98      $7,000,000.00                   $5,838,667.62
        Partners, L.P.

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


<CAPTION>





------------------------------------------------------------------------------------------
Note #        Borrower           Collateral Description            Lien Position

------------------------------------------------------------------------------------------
<S>     <C>                      <C>                               <C>
1.      Collins Crossing, Ltd.   To be constructed 11-story            Second
                                 multi-tenant office building
                                 containing 300,887 (approximate)
                                 square feet located in a suburb
                                 of Dallas, Texas
------------------------------------------------------------------------------------------
2.      Collins Crossing, Ltd.   To be constructed 11-story            Second
                                 multi-tenant office building
                                 containing 300,887 (approximate)
                                 square feet located in a suburb
                                 of Dallas, Texas
------------------------------------------------------------------------------------------
3.      Benton Columbus          956,144 (approximate) square          Second
        Partners, L.P.           foot mixed-use development
                                 located in Columbus, Ohio
------------------------------------------------------------------------------------------

</TABLE>





                                    EXHIBIT A
                                    Solo Page

<PAGE>   23

                                    EXHIBIT A

                                      NOTES


         1.       Promissory Note dated March 30, 1998, in the original
                  principal amount of $2,450,000.00, executed by Collins
                  Crossing, Ltd., payable to the order of AMRESCO Funding
                  Corporation.

         2.       Promissory Note dated March 30, 1998, in the original
                  principal amount of $12,250,000.00, executed by Collins
                  Crossing, Ltd. payable to the order of AMRESCO Funding
                  Corporation.

         3.       Promissory Note dated February 20, 1998, in the original
                  principal amount of $7,000,000.00, executed by Benton Columbus
                  Partners LP, a Texas limited partnership and AMRESCO Funding
                  Corporation.



                                    EXHIBIT A
                                    Solo Page



<PAGE>   24


                                    EXHIBIT B


                                   ASSIGNMENT

                  This Assignment is entered into by and between AMRESCO Funding
Corporation ("Assignor") and [AMRESCO Capital Trust] [AMREIT I, Inc.]
("Assignee").

                                    RECITALS

                  Assignor and Assignee entered into that certain Sale and
Assignment Agreement effective May 12, 1998 (the "Sale and Assignment
Agreement").

                  The Sale and Assignment Agreement provides for the sale and
transfer by Assignor to Assignee of certain Assigned Rights (such term and all
other capitalized terms used herein and not otherwise defined herein have the
definitions ascribed to them in the Sale and Assignment Agreement).

                  In exchange for the Purchase Price and covenants set forth in
the Sale and Assignment Agreement and such other good and valuable consideration
as provided in the Sale and Assignment Agreement, Assignor hereby agrees to sell
to Assignee the Assigned Rights as set forth in the Sale and Assignment
Agreement and pursuant to the terms, conditions and provisions hereof.

         NOW THEREFORE, premises considered:

                           (1) Assignor hereby transfers, assigns and conveys
         all of Assignor's right, title and interest, if any, in and to the
         Assigned Rights set forth in the instruments listed on Exhibit A
         attached hereto and made a part hereof for all purposes;

                           (2) Subject to such other additional limitations,
         disclaimers, waivers and qualifications as may be further set forth in
         the Sale and Assignment Agreement, this sale is made on an "AS IS",
         "WHERE IS" BASIS, "WITH ALL FAULTS" AND WITHOUT REPRESENTATIONS,
         EXPRESS OR IMPLIED, OF ANY TYPE, KIND, CHARACTER OR NATURE, AND WITHOUT
         WARRANTIES, EXPRESS OR IMPLIED, AND WITHOUT RECOURSE, EXPRESS OR
         IMPLIED;

                           (3) Without in any way limiting the generality of the
         foregoing, with respect to the Assigned Rights, together with any and
         all related collateral, if any, Assignor hereby disclaims and disavows:

                               (i)  any express or implied warranty of 
                           "Merchantability"; and


                                    EXHIBIT B
                                Page 1 of 3 Pages

<PAGE>   25



                                    (ii) any express or implied warranty of
                                         "Fitness For A Particular Purpose".

                           (4) Assignee hereby assumes any and all of Assignor's
         obligations under the Assigned Rights arising on or after the date
         hereof, including, without limitation, all of Assignor's obligations,
         if any, to make advances under the Loan Documents.

                           DATED this ________ day of May, 1998.


                                            By:      AMRESCO Funding Corporation



                                                     By:
                                                        ------------------------
                                                     Printed Name:
                                                                  --------------
                                                     Title:
                                                            --------------------





                                    EXHIBIT B
                                Page 2 of 3 Pages

<PAGE>   26



                             EXHIBIT A TO ASSIGNMENT







                                    EXHIBIT B
                                Page 3 of 3 Pages

<PAGE>   27



                                    EXHIBIT C

                                WIRE INSTRUCTIONS



Wire Transfer to:       NationsBank, N.A.
                        Atlanta, Georgia
                        ABA #061000052
                        Deposit Account 325-545-0340
                        Account Name:  AMRESCO Funding Corporation
                        Attention:  Cynthia Strahin (404) 654-2669; 
                                               Fax (404) 654-2468



                                    EXHIBIT C
                                    Solo Page

<PAGE>   28



                                    EXHIBIT D


                        CERTIFICATE OF PRINCIPAL BALANCES


STATE OF DALLAS                     Section
                                    Section
COUNTY OF TEXAS                     Section



         The undersigned, ________________________________ of AMRESCO Funding
Corporation, certifies the following:

         1.       The promissory notes (the "Notes") described on Schedule I
                  attached hereto were assigned to [AMRESCO Capital Trust]
                  [AMREIT I, Inc.], by AMRESCO Funding Corporation ("Assignor")
                  on May 12, 1998, as evidenced by the endorsement of the Notes
                  and the execution of an Assignment.

         2.       The outstanding principal balance of the Note(s) as of the
                  close of business on May 11, 1998, is set forth on Schedule I
                  attached hereto.

                                          AMRESCO Funding Corporation


                                          --------------------------------------
                                          Name:
                                               ---------------------------------
                                          Title:
                                                 -------------------------------

         SUBSCRIBED AND SWORN TO BEFORE me this day of May, 1998.


                                          -------------------------------------
                                          Notary Public in and for the State of
                                          ----------------------------------


                                    EXHIBIT D
                                    Solo Page

<PAGE>   29



                                   SCHEDULE I




<TABLE>
<CAPTION>


-----------------------------------------------------------------------------------------------------
Note #        Borrower         Origination  Original Principal  Principal Balance as of Cut-
                                  Date           Balance               Off Date
-----------------------------------------------------------------------------------------------------
<S>     <C>                    <C>          <C>                 <C>
1.      Collins Crossing, Ltd.   3/30/98      $2,450,000.00                           $0.00




-----------------------------------------------------------------------------------------------------
2.      Collins Crossing, Ltd.   3/30/98     $12,250,000.00                       $1,000.00




-----------------------------------------------------------------------------------------------------
3.      Benton Columbus          2/20/98      $7,000,000.00                   $5,838,667.62
        Partners, L.P.

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


<CAPTION>





------------------------------------------------------------------------------------------
Note #        Borrower           Collateral Description            Lien Position

------------------------------------------------------------------------------------------
<S>     <C>                      <C>                               <C>
1.      Collins Crossing, Ltd.   To be constructed 11-story            Second
                                 multi-tenant office building
                                 containing 300,887 (approximate)
                                 square feet located in a suburb
                                 of Dallas, Texas
------------------------------------------------------------------------------------------
2.      Collins Crossing, Ltd.   To be constructed 11-story            Second
                                 multi-tenant office building
                                 containing 300,887 (approximate)
                                 square feet located in a suburb
                                 of Dallas, Texas
------------------------------------------------------------------------------------------
3.      Benton Columbus          956,144 (approximate) square          Second
        Partners, L.P.           foot mixed-use development
                                 located in Columbus, Ohio
------------------------------------------------------------------------------------------

</TABLE>


                                   SCHEDULE I

<PAGE>   30



                                    EXHIBIT E

                               NOTICE TO BORROWER

AMRESCO Funding Corporation

[Date]

[Borrower's Name                             CERTIFIED MAIL NO. _______________
Borrower's Address                                     RETURN RECEIPT REQUESTED
City, State  Zip Code

Attention:___________________]


Re:      Sale and assignment of certain indebtedness currently owed to AMRESCO 
         Funding Corporation ("AFC")


Dear [Borrower]:

         We hereby refer to the following:

         Promissory note executed by ____________________________________ (the
         "Borrower") dated and payable to the order of AMRESCO Funding
         Corporation in the stated principal amount of
         $___________ (the "Note").


AFC is the current owner and holder of the Note (such Note, together with the
documents executed in connection with such Note, shall be referred to as the
"Loan Documents").

This letter shall constitute notice to the Borrower of the sale and assignment
of all of AFC's right, title and interest in, to and under the Loan Documents to
[AMRESCO Capital Trust] [AMREIT I, Inc.] ("Assignee"). This transaction closed
on May 12, 1998 (the "Closing Date").

         From and after the Closing Date, Assignee shall succeed to all of the
rights and obligations of AFC under the Loan Documents and the Borrower shall
treat Assignee for all purposes as payee in place of AFC under the Loan
Documents. After receipt of this letter, the Borrower should make no further
payments on the Note to AFC, but should make such payments to the following:

             [AMRESCO Capital Trust] [AMREIT I, Inc.]

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

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

             ----------------------
             Attention:
                         ----------


                                    EXHIBIT E
                                Page 1 of 2 Pages

<PAGE>   31




If you have any questions regarding the foregoing, please feel free to call
___________________ of Assignee at (800) _____-________.


                                            Very truly yours,

                                            AMRESCO Funding Corporation

                                            By:
                                                --------------------------------
                                            Printed Name:
                                                         -----------------------
                                            Its:
                                                 -------------------------------



cc:
    ----------------------------------



                                    EXHIBIT E
                                Page 1 of 2 Pages