(3) Access. All public roads and streets necessary for service of and access to theProperty for the current or contemplated use thereof have been completed, are serviceable and arephysically and legally open for use by the public. If the Property does not abut and havesufficient legal and physical access to one or more public roads or streets for the use of theProperty, perpetual right-of-way easements have been recorded over abutting parcels so as toprovide such access from such public roads and streets and such easement or easements are insuredunder the Lender’s title policy.               (4) Condition of Property. The Property is in good condition and repair and is freefrom any damage that would materially and adversely affect the value of the Property as securityfor the Loan or the intended use of the Property. All building systems contained therein are ingood working order in all material respects, subject to ordinary wear and tear.     2. **Easements, Assessments, Etc.** Without Lender’s prior written consent, Borrower willnot cause or otherwise consent to: (a) the creation of any new easement, covenant or the like withrespect to the Property; (b) the formation of any assessment district or community facilitiesdistrict that includes all or any part of the Property; or (c) the levying of special taxes orassessments against the Property.     3. **Insurance Coverage**. Borrower will insure and keep insured all improvements now orhereafter created upon the Property against loss or damage by fire and windstorm and any otherhazard or hazards, as may be reasonably required from time to time by Lender in accordance with therequirements of the Deed of Trust. Borrower must deliver to Lender the insurance policies, withthe mortgage indemnity clause as Lender shall direct. Borrower must deliver renewals of suchpolicies to Beneficiary at least ten (10) days before any such insurance policies shall expire.Any proceeds which Lender may receive under any such policy, or policies, may be applied by Lender,at its option, to reduce the indebtedness hereby secured, whether then matured or to mature in thefuture, and in such manner as Lender may elect; or Lender may permit Borrower to use said proceedsto repair or replace all improvements damaged or destroyed and covered by said policy.     4. **Insurance and Condemnation Proceeds.**          (a) Casualty. In the event the Property is damaged or destroyed by an insured perilor otherwise, Lender will have the sole right and authority to make, settle and compromise any andall insurance claims and other claims in connection therewith and to apply all casualty proceeds torepayment of the Note and the other obligations secured by the loan documents.          (b) Condemnation. As used in this Agreement, term “Condemnation” means anytaking or proposed taking of all or any part of the Property or any rights with respect theretounder the exercise of the power of eminent domain, or in lieu of such exercise. In the event of aCondemnation, all such proceedings relating to the Condemnation will be subject to the control ofBorrower but subject to the approval of Lender, as provided below. Lender’s only requirement forapproval of the final Condemnation award and release of its liens on the Property is that thecondemnation proceeds besufficient to pay the Note and all sums due under the loan documents, and be assigned and paid toLender for application to repayment of the Note and the other obligations secured by the loandocuments.          (c) Conflicts Among Documents. To the extent of any inconsistency between theprovisions of this Section and the provisions of the loan documents regarding the settlement,collection and application of casualty proceeds and condemnation proceeds, the provisions of thisAgreement will govern such matters.     5. **Required Notices.** Borrower will notify Lender within five (5) business days fromthe occurrence of any event known to Borrower (or the receipt of any notice by Borrower) that couldhave a
 

 
material adverse effect on Borrower or the Property, or any portion thereof, including,without limitation: (a) the assertion, recording or filing of any material lien, claim or disputeaffecting Borrower or the Property; (b) the filing of any material action or proceeding affectingBorrower or the Property; (c) the occurrence of any material damage to the Property; (d) only uponan Event of Default beyond the applicable notice period and the expiration of any applicable cureperiod, any condemnation offer or action affecting the Property; or (e) any notice regardingviolation of any laws affecting Borrower or the Property.     6. **Compliance With Access Laws.** Borrower will maintain the improvements on theProperty in strict accordance and full compliance with all laws.     7. **Right to Contest.** Borrower will have the right to contest in good faith anyclaim, charge, demand, levy or assessment payable to a party other than Lender, the non-payment ofwhich would constitute an Event of Default under this Agreement, but only with Lender’s priorwritten consent. If Lender grants such consent, such non-payment will not constitute an Event ofDefault so long as such consent remains effective. Lender will not withhold its consentunreasonably, provided that Lender has been furnished a bond satisfactory to it in its sole butreasonable discretion to discharge such claim, charge, etc. in full in the event Borrower shouldnot prevail in such contest. Lender may withdraw such consent at any time if: (a) Borrower failsto prosecute such contest diligently, in full compliance with all conditions to Lender’s consentand in a manner not prejudicial to Lender or its rights hereunder or to the Property, or (b)Lender, in its sole but reasonable discretion, determines that such contested claim, charge, etc.,has a material adverse effect on the Property or Lender.     8. **Events of Default.** Any of the following shall constitute an “Event ofDefault” as that term is used in the loan documents (and the term “Default” shall mean any ofthe following, whether or not any requirement for notice or lapse of time has been satisfied):          (a) Any default under the Note and the expiration of the applicable grace period.          (b) Any representation or warranty made by Borrower to or for the benefit of Lender herein orelsewhere in connection with the Loan, including but not limited to any representation inconnection with the security therefor, proves to have been incorrect or misleading in any materialrespect.          (c) Borrower becomes unable or admits in writing its inability to pay its debts as they becomedue, or file, or has filed against it, a voluntary or involuntary petition in bankruptcy, or makesa general assignment for the benefit of creditors, or becomes the subject of any other receivershipor insolvency proceeding, provided that if such petition or proceeding is not filed or acquiescedin by Borrower or the subject thereof, it shall constitute an Event of Default only if it is notdismissed within sixty (60) days after it is filed or if prior to that time the court enters anorder substantially granting the relief sought therein.          (d) Borrower defaults in the performance of any covenant or agreement contained in anymortgage, deed of trust or similar security instrument encumbering the Property, or the note or anyother agreement evidencing or securing the indebtedness secured thereby, which default continuesbeyond any applicable notice and cure period.
 

 
     9. **Remedies.**          (a) After the occurrence and during the continuance of an Event of Default, all or any one ormore of the rights, powers and other remedies available to Lender under this Agreement, the Note,or the loan documents, or at law or in equity, may be exercised by Lender at any time and from timeto time, without notice or demand, whether or not all or any portion of the Indebtedness has beendeclared due and payable, and whether or not Lender has commenced any foreclosure proceeding orother action for the enforcement of its rights and remedies under any of the loan documents withrespect to the Property. Any such actions taken by Lender will be cumulative and concurrent andmay be pursued independently, singly, successively, together or otherwise, at such time and in suchorder as Lender may determine in its sole discretion, to the fullest extent permitted by law,without impairing or otherwise affecting the other rights and remedies of Lender permitted by law,equity or contract or as set forth in this Agreement or the other loan documents.          (b) After the occurrence and during the continuance of any Event of Default, Lender may, atits sole option, declare all sums owing to Lender under the Note, this Agreement and the other loandocuments immediately due and payable. Upon such acceleration, Lender may, in addition to allother remedies permitted under this Agreement and the other loan documents and at law or equity,apply any sums any and all accounts maintained by Borrower with Lender to the sums owing under theloan documents.          (c) Any and all funds expended by Lender in the exercise of its rights or remedies under thisAgreement and the other loan documents will be payable to Lender upon demand, together withinterest at the rate applicable to the principal balance of the Note from the date the funds wereexpended.          (d) All Lender’s rights and remedies provided in this Agreement and the other loan documents,together with those granted by law or at equity, are cumulative and may be exercised by Lender atany time. Lender’s exercise of any right or remedy will not constitute a cure of any Defaultunless all sums then due and payable to Lender under the loan documents are repaid and Borrower hascured all other Defaults. No waiver will be implied from any failure of Lender to take, or anydelay by Lender in taking, action concerning any Default or failure to satisfy a conditionprecedent under the loan documents, or from any previous waiver of any similar or unrelated Defaultor failure to satisfy a condition precedent. Any consent, waiver or approval under any of the loandocuments must be in writing and will be limited to its specific terms.     10. **Financial Reporting.**          (a) Borrower will keep adequate books and records of account in accordance with generallyaccepted accounting principles, consistently applied and will furnish to Lender the financialreports that Lender may reasonably request and in the possession of Borrower or Borrower’s agent.          (b) Borrower agrees that all financial statements to be delivered to Lender will: (1) becomplete and correct in all material respects; (2) present fairly the financial condition of theparty in all material respects; and (3) disclose all liabilities that are required to be reflectedor reserved against. Borrower will be deemed to warrant and represent that, as of the date ofdelivery of any such financial statement, there has been no material adverse effect since the dateof the financial statement, except national general economic conditions, nor have any assets orproperties been sold, transferred, assigned, mortgaged, pledged or encumbered since the date ofsuch financial statement, except as disclosed by Borrower in a writing delivered to Lender;provided, however that Borrower has notified Lender that it has entered into a contract to sell itsproperty in Ellicottville, New York.
 

 
     11. **General Provisions**.          (a) Except as otherwise specifically provided in this Agreement, all notices, consents andother communications provided for in this Agreement must be in writing and mailed, faxed orotherwise transmitted or delivered to Lender or Borrower, as applicable, at their respective noticeaddresses as set forth in the Note, or at such other address as a party may designate for itself ina written notice to the other party or parties. All such notices, consents and communications willbe effective: (a) if mailed, three (3) business days following deposit in the United States mail,certified or registered postage prepaid; (b) if delivered by recognized overnight delivery service(such as Federal Express), upon delivery; and (c) if transmitted by fax, when transmitted andelectronic confirmation of transmission is received.          (b) Borrower will immediately pay Lender upon demand all reasonable costs and expensesincurred by Lender in connection with: (a) the preparation of the loan documents; (b) theenforcement or satisfaction by Lender of any of Borrower’s obligations under the other loandocuments; (c) appraisals and inspections of the Property required by Lender as a result of anEvent of Default; (d) appraisals and inspections of the Property required by applicable law,including, without limitation, federal or state regulatory reporting requirements; (e) any actsperformed by Lender at Borrower’s request or wholly or partially for the benefit of Borrower(including, without limitation, the preparation or review of amendments, assumptions, waivers,releases, reconveyances, estoppel certificates or statements of amounts owing under anyIndebtedness); and (f) Lender’s out-of-pocket costs for administration of the Loan.          (c) BORROWER AGREES TO DEFEND, INDEMNIFY AND HOLD HARMLESS LENDER AND THE OTHER INDEMNIFIEDPARTIES FOR, FROM AND AGAINST ANY CLAIM, LOSS, DAMAGE, COST, EXPENSE OR LIABILITY DIRECTLY ORINDIRECTLY ARISING OUT OF: (A) THE MAKING OF THE LOAN, EXCEPT FOR VIOLATIONS OF BANKING LAWS ORREGULATIONS BY THE INDEMNIFIED PARTIES; (B) THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS; (C) THEEXECUTION OF THIS AGREEMENT OR THE PERFORMANCE OF ANY ACT REQUIRED OR PERMITTED HEREUNDER OR BYLAW; (D) ANY FAILURE OF BORROWER TO PERFORM BORROWER’S OBLIGATIONS UNDER THIS AGREEMENT OR THEOTHER LOAN DOCUMENTS; (E) ANY ALLEGED OBLIGATION OR UNDERTAKING ON THE INDEMNIFIED PARTIES’ PART TOPERFORM OR DISCHARGE ANY OF THE REPRESENTATIONS, WARRANTIES, CONDITIONS, COVENANTS OR OTHER OBLIGATIONS OF BORROWER CONTAINED INANY OTHER DOCUMENT RELATED TO THE PROPERTY; OR (F) ANY ACT OR OMISSION BY BORROWER OR ANYCONTRACTOR, SUBCONTRACTOR, ARCHITECT, SUPPLIER, AGENT, EMPLOYEE OR REPRESENTATIVE OF BORROWER WITHRESPECT TO THE PROPERTY. THE FOREGOING TO THE CONTRARY NOTWITHSTANDING, THIS INDEMNITY WILL NOTINCLUDE ANY CLAIM, LOSS, DAMAGE, COST, EXPENSE OR LIABILITY DIRECTLY OR INDIRECTLY ARISING OUT OFTHE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF ANY MEMBER OF THE INDEMNIFIED PARTIES. THISINDEMNITY WILL INCLUDE, WITHOUT LIMITATION, (I) ANY CLAIM, LOSS, DAMAGE, COST, EXPENSE OR LIABILITYDIRECTLY OR INDIRECTLY ARISING OUT OF THE ORDINARY NEGLIGENCE OF ANY MEMBER OF THE INDEMNIFIEDPARTIES, AND (II) ALL COURT COSTS AND REASONABLE ATTORNEYS’ FEES (INCLUDING, WITHOUT LIMITATION,EXPERT WITNESS FEES) PAID OR INCURRED BY LENDER OR ANY OF THE OTHER INDEMNIFIED PARTIES. BORROWERWILL PAY IMMEDIATELY UPON LENDER’S DEMAND ANY AMOUNTS OWING UNDER THIS INDEMNITY TOGETHER WITHINTEREST FROM THE DATE THE INDEBTEDNESS ARISES UNTIL PAID AT THE RATE OF INTEREST APPLICABLE TO THEPRINCIPAL BALANCE OF THE NOTE AS SPECIFIED THEREIN. BORROWER AGREES TO USE LEGAL COUNSELREASONABLY ACCEPTABLE TO LENDER
 

 
AND THE OTHER INDEMNIFIED PARTIES IN ANY ACTION OR PROCEEDINGARISING UNDER THIS INDEMNITY. THE PROVISIONS OF THIS SECTION WILL SURVIVE THE RELEASE ORFORECLOSURE OF THE SECURITY INSTRUMENT.          (d) Borrower acknowledges and agrees that Lender’s acceptance or approval of any action ofBorrower or any other matter requiring Lender’s approval, satisfaction, acceptance or consentpursuant to this Agreement or the other loan documents, including any other agreement, report,certificate, financial statement, appraisal or insurance policy, will not be deemed a warranty orrepresentation by Lender of the sufficiency, legality, effectiveness or other import or effect ofsuch matter.          (e) If any attorney is engaged by Lender to enforce or defend any provision of the loandocuments, or as a consequence of any Event of Default under the loan documents, with or withoutthe filing of any legal action or proceeding, and including, without limitation, any fees andexpenses incurred in any bankruptcy proceeding, then Borrower will immediately pay to Lender, upondemand, the amount of all attorneys’ fees and expenses and all costs incurred by Lender inconnection therewith, together with interest thereon from the date paid by Lender until repaid byBorrower to Lender at the rate of interest applicable to the principal balance of the Note asspecified therein.          (f) This Agreement is between and for the sole benefit of Borrower and Lender, and Lender’ssuccessors and assigns, and, except as expressly provided with respect to certain indemnities infavor of other Indemnified Parties, creates no rights whatsoever in favor of any other Person andno other Person will have any rights to rely hereon.          (g) Time is of the essence of each of Borrower’s obligations under this Agreement. The waiverby Lender of any Default under this Agreement or the other loan documents will not be deemed awaiver of any other Default.          (h) This Agreement will be binding upon and inure to the benefit of Borrower and Lender andtheir respective heirs, executors, administrators, successors and assigns; provided howeverBorrower may not assign its rights or interests in this Agreement without the prior written consentof Lender, which may be withheld in Lender’s sole discretion. Borrower acknowledges that Lenderwould not make the Loan except in reliance on Borrower’s expertise, reputation and prior experiencein developing and constructing commercial real property, Lender’s knowledge of Borrower, and Lender’sunderstanding that this Agreement is more in the nature of an agreement involving personal servicesthan a standard loan where Lender would rely on security that already exists.          (i) This Agreement may be executed in counterparts, each of which will be deemed an original,and such counterparts when taken together will constitute but one agreement.          (j) Wherever Lender’s consent, approval, acceptance or satisfaction is required under anyprovision of this Agreement or any of the other loan documents, such consent, approval, acceptanceor satisfaction must be in writing and will not unreasonably be withheld, conditioned or delayed byLender unless such provision expressly so provides.          (k) This Agreement, together with the other loan documents, constitutes the entire agreementof the parties with respect to the Loan, and supersedes any prior negotiations or agreements, anyloan application submitted by Borrower to Lender and any commitment for the Loan delivered byLender to Borrower. No consent, modification, extension, discharge, termination or waiver of anyprovision of this Agreement or the other loan documents will be effective unless in writing, signedby the
 

 
Person against whom enforcement is sought, and will be effective only in the specificinstance for which it is given.          (l) The Loan will be deemed to have been made in the State of Texas. This Agreement and theother loan documents will be governed by and construed and enforced in accordance with the laws ofTexas without regard to its conflicts of laws principles. Borrower and Lender each unconditionallyand irrevocably waives any right to assert that the law of any other jurisdiction governs thisAgreement and the other loan documents. Venue is proper in Dallas County, Texas.          (m) If a court of competent jurisdiction finds any provision of this Agreement or the otherloan documents to be invalid or unenforceable as to any Person or circumstance in any jurisdiction,such finding will not render that provision invalid or unenforceable as to any other Person orcircumstance or in any other jurisdiction. Where permitted by applicable law, any provision foundinvalid or unenforceable will be deemed modified to the extent necessary to be within the limits ofenforceability or validity; however, if such provision cannot be deemed so modified, it will bedeemed stricken and all other provisions of this Agreement in all other respects will remain validand enforceable.          (n) Borrower and Lender intend that the relationship created under this Agreement and theother loan documents be solely that of borrower and lender. Nothing is intended to create a jointventure, partnership, tenancy-in-common, or joint tenancy relationship between Borrower and Lendernor to grant to Lender any interest in the Property other than that of mortgagee (or in the case ofa deed of trust, beneficiary) or secured party.          (o) Borrower hereby waives, to the extent permitted by applicable law, the right to assert anycounterclaim, other than a compulsory counterclaim, in any action or proceeding brought againstBorrower by Lender under any of the loan documents.          (p) The headings and captions of various sections of this Agreement are for convenience ofreference only and are not to be construed as defining or limiting, in any way, the scope or intentof the provisions hereof.          (q) As used in this Agreement, singular terms include the plural and plural terms include thesingular as the context may require.          (r) All references to any agreement or contract in this Agreement refer to such agreement orcontract as currently in effect and as it may be amended, supplemented or replaced in accordancewith the terms of this Agreement and the other loan documents.          (s) All terms not defined herein are defined in the Deed of Trust Note, dated of even date byBorrower, as Maker, and Lender, as Lender (the “Note”), or the Deed of Trust, Security Agreement,and Financing Statement, of even date, from Alterco Incorporated, as Grantor, to Kevin M. Kerr, asTrustee, for the benefit of Lender (the “Deed of Trust”), as the case may be.     12. **Interest Reserve**. Borrower agrees to deposit $60,000.00 with Lender as an InterestReserve (herein so called) on the date hereof. Borrower agrees to deposit an additional $5,000.00with each payment on the Note until the total Interest Reserve balance totals $120,000.00. Lenderagrees to apply the Interest Reserve funds to the final six (6) interest payments on the Note. TheInterest Reserve will accrue interest, and Lender will hold it without bond in escrow. Upon theoccurrence of an Event of Default, after any applicable notice and the failure to cure within anyapplicable grace period, Lender may, at its option, apply the Interest Reserve to any obligationevidenced by the Note or any loan
 

 
document. All bank fees due to the Interest Reserve account willbe paid from by Lender from the Interest Reserve.     DATED as of March 19, 2009.      **LENDER****:**