Document:

Exhibit
4.08

 

SILICON IMAGE, INC.

NON-PLAN STOCK OPTION AGREEMENT

 

                This Stock Option Agreement
(this “Agreement”)
is made and entered into as of the date of grant set forth below (the “Date of Grant”) by
and between Silicon Image, Inc., a Delaware corporation (the “Company”), and the
optionee named below (“Optionee”). 
Capitalized terms not defined herein shall have the meaning ascribed to
them in Section 20.

 

	
  Optionee:

  	
  John LeMoncheck

  
	
   

  	
   

  
	
  Social Security Number:

  	
  ###-##-####

  
	
   

  	
   

  
	
  Total Option Shares:

  	
  325,000

  
	
   

  	
   

  
	
  Exercise Price Per Share:

  	
  $6.3500

  
	
   

  	
   

  
	
  Date of Grant:

  	
  January 6, 2003

  
	
   

  	
   

  
	
  First Vesting Date:

  	
  January 6, 2004

  
	
   

  	
   

  
	
  Expiration Date:

  	
  Option will expire 3
  months following termination for any

  
	
   

  	
  reason except death, disability or cause, but in no event

  
	
   

  	
  later than 01/06/13.
  (refer to Sec. 3 of this Stock Option Agreement)

  
	
   

  	
   

  
	
  Type of Stock Option:

  	
  NQSO

  

 

                             1.             Grant of Option.  The Company hereby grants to Optionee an
option (this “Option”)
to purchase up to the total number of shares of common stock of the Company,
$0.001 par value (“Common Stock”),
set forth above (collectively, the “Shares”) at the Exercise Price Per Share set forth above
(the “Exercise Price”),
subject to all of the terms and conditions of this Agreement.

 

                             2.             Vesting; Exercise Period.

 

                                             2.1           Vesting of Shares.  This Option shall be exercisable
as it vests.  Subject to the terms and
conditions of this Agreement, this Option shall vest and become exercisable as
to portions of the Shares as follows: 
(a) this Option shall not be exercisable with respect to any of the
Shares until January 6, 2004 (the “First Vesting Date”); (b) if Optionee
has continuously provided services to the Company, or any Parent or Subsidiary
of the Company, then on the First Vesting Date, this Option shall become exercisable
as to one fourth (1/4th) of the Shares (rounded to the nearest whole
share); and (c) thereafter this Option shall become exercisable as to an
additional one forty-eighth (1/48th) of the Shares (rounded to the
nearest whole share) at the end of each full succeeding month, provided that
Optionee has continuously provided services to the Company, or any Parent or
Subsidiary of the Company.   This Option
shall cease to vest upon Optionee’s Termination and Optionee shall in no event
be entitled under this Option to purchase a number of shares of the Company’s
Common Stock greater than the “Total Option Shares.”

 

 

 

                             2.2           Expiration.  This Option shall expire on the Expiration
Date set forth above and must be exercised, if at all, on or before the earlier
of the Expiration Date or the date on which this Option is earlier terminated
in accordance with the provisions of Section 3, provided, however,
that this Option will be not be exercisable after the expiration of ten (10)
years from the Date of Grant.

 

                             3.             Termination.

 

                                             3.1           Termination for Any Reason Except Death,
Disability or Cause.  If Optionee is
Terminated for any reason except Optionee’s death, Disability or Cause, then
this Option, to the extent (and only to the extent) that it is vested in accordance
with the schedule set forth in Section 2.1 of this Agreement on the date of
Termination, may be exercised by Optionee no later than three (3) months after
the date of Termination, but in any event no later than the Expiration Date.

 

                                             3.2           Termination Because of Death or Disability.  If Optionee is Terminated because of death
or Disability of Optionee (or the Optionee dies within three (3) months after a
Termination other than because of death, Disability or Cause), then this
Option, to the extent that it is vested in accordance with the schedule set
forth in Section 2.1 of this Agreement on the date of Termination, may be
exercised by Optionee (or Optionee’s legal representative) no later than twelve
(12) months after the date of Termination, but in any event no later than the
Expiration Date.

 

                                             3.3           Termination for Cause.  If Optionee is Terminated for Cause, this
Option will expire on the Optionee’s date of Termination.

 

                                             3.4           No Obligation to Employ.  Nothing in this Agreement shall confer on
Optionee any right to continue in the employ of, or other relationship with,
the Company or any Parent or Subsidiary of the Company, or limit in any way the
right of the Company or any Parent or Subsidiary of the Company to terminate
Optionee’s employment or other relationship at any time, with or without Cause.

 

                             4.             Manner of Exercise.

 

                                             4.1           Stock Option Exercise Agreement.  To exercise this Option, Optionee (or in the
case of exercise after Optionee’s death, Optionee’s executor, administrator,
heir or legatee, as the case may be) must deliver to the Company an executed
stock option exercise agreement in the form attached hereto as Exhibit A,
or in such other form as may be approved by the Company from time to time (the
“Exercise Agreement”),
which shall set forth, inter  alia, Optionee’s election to
exercise this Option, the number of shares being purchased, any restrictions
imposed on the Shares and any representations, warranties and agreements
regarding Optionee’s investment intent and access to information as may be
required by the Company to comply with applicable securities laws.  If someone other than Optionee exercises
this Option, 

 

 

2

 

 

then such person
must submit documentation reasonably acceptable to the Company that such person
has the right to exercise this Option.

 

                                             4.2           Limitations on Exercise.  This Option may not be exercised unless such
exercise is in compliance with all applicable federal and state securities
laws, as they are in effect on the date of exercise.  This Option may not be exercised as to fewer than 100 Shares
unless it is exercised as to all Shares as to which this Option is then
exercisable.

 

                                             4.3           Payment.  The Exercise Agreement shall be accompanied
by full payment of the Exercise Price for the Shares being purchased in cash
(by check), or where permitted by law:

 

                                      (a)           provided
that a public market for the Company’s stock exists:  (1) through a “same day sale” commitment from Optionee and a
broker-dealer that is a member of the National Association of Securities
Dealers (an “NASD Dealer”)
whereby Optionee irrevocably elects to exercise this Option and to sell a
portion of the Shares so purchased to pay for the exercise price and whereby
the NASD Dealer irrevocably commits upon receipt of such Shares to forward the
exercise price directly to the Company; or (2) through a “margin”
commitment from Optionee and a NASD Dealer whereby Optionee irrevocably elects
to exercise this Option and to pledge the Shares so purchased to the NASD Dealer
in a margin account as security for a loan from the NASD Dealer in the amount
of the exercise price, and whereby the NASD Dealer irrevocably commits upon
receipt of such Shares to forward the exercise price directly to the Company;
or

 

                                      (b)           by
any combination of the foregoing.

 

                                             4.4           Tax Withholding.  Prior to the issuance of the Shares upon
exercise of this Option, Optionee must pay or provide for any applicable
federal or state withholding obligations of the Company.  If the Committee permits, Optionee may
provide for payment of withholding taxes upon exercise of this Option by
requesting that the Company retain Shares with a Fair Market Value equal to the
minimum amount of taxes required to be withheld.  In such case, the Company shall issue the net number of Shares to
the Optionee by deducting the Shares retained from the Shares issuable upon
exercise.

 

                                             4.5           Issuance of Shares.  Provided that the Exercise Agreement and
payment are in form and substance satisfactory to counsel for the Company, the
Company shall issue the Shares registered in the name of Optionee, Optionee’s
authorized assignee, or Optionee’s legal representative, and shall deliver
certificates representing the Shares with the appropriate legends affixed
thereto.

 

                             5.             Compliance with Laws and Regulations.  The exercise of this Option and the issuance
and transfer of Shares shall be subject to compliance by the Company and
Optionee with all applicable requirements of federal and state securities laws
and with all applicable 

 

 

3

 

 

requirements of
any stock exchange on which the Company’s Common Stock may be listed at the
time of such issuance or transfer. 
Optionee understands that the Company is under no obligation to register
or qualify the Shares with the Securities and Exchange Commission, any state
securities commission or any stock exchange to effect such compliance.

 

                             6.             Nontransferability of Option.  This Option may not be transferred in any
manner other than by will or by the laws of descent and distribution and may be
exercised during the lifetime of Optionee only by Optionee.  The terms of this Option shall be binding
upon the executors, administrators, successors and assigns of Optionee.

 

                             7.             Tax Consequences.  Set forth below is a brief summary of some
of the federal and California tax consequences of exercise of this Option and
disposition of the Shares.  THIS SUMMARY
IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO
CHANGE.  OPTIONEE SHOULD CONSULT A TAX
ADVISOR BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES.

 

                                             7.1           Exercise of Nonqualified Stock Option.  There may be a regular federal and
California income tax liability upon the exercise of this Option.  Optionee will be treated as having received
compensation income (taxable at ordinary income tax rates) equal to the excess,
if any, of the fair market value of the Shares on the date of exercise over the
Exercise Price.  The Company will be
required to withhold from Optionee’s compensation or collect from Optionee and
pay to the applicable taxing authorities an amount equal to a percentage of
this compensation income at the time of exercise.

 

                                             7.2           Disposition of Shares.  If the Shares are held for more than twelve
(12) months after the date of the transfer of the Shares pursuant to the
exercise of an NQSO, any gain realized on disposition of the Shares will be
treated as long-term capital gain, as the case may be.

 

                             8.             Privileges of Stock Ownership. 
Optionee shall not have any of the rights of a shareholder with respect
to any Shares until Optionee exercises this Option and pays the Exercise Price.

 

                             9.             Interpretation. 
Any dispute regarding the interpretation of this Agreement shall be
submitted by Optionee or the Company to the Committee for review.  The resolution of such a dispute by the
Committee shall be final and binding on the Company and Optionee.

 

                             10.          Entire Agreement. 
This Agreement and the Exercise Agreement constitute the entire
agreement and understanding of the parties hereto with respect to the subject
matter hereof and supersede all prior understandings and agreements with
respect to such subject matter.

 

                             11.          Notices. 
Any notice required to be given or delivered to the Company under the
terms of this Agreement shall be in writing and addressed to the Corporate
Secretary of the Company at its principal corporate offices.  Any notice required to be given or delivered
to 

 

 

4

 

 

Optionee shall be
in writing and addressed to Optionee at the address indicated above or to such
other address as such party may designate in writing from time to time to the
Company.  All notices shall be deemed to
have been given or delivered upon: 
personal delivery; three (3) days after deposit in the United States
mail by certified or registered mail (return receipt requested); one (1)
business day after deposit with any return receipt express courier (prepaid);
or one (1) business day after transmission by rapifax or telecopier.

 

                             12.          Successors and Assigns. 
The Company may assign any of its rights under this Agreement.  This Agreement shall be binding upon and
inure to the benefit of the successors and assigns of the Company.  Subject to the restrictions on transfer set
forth herein, this Agreement shall be binding upon Optionee and Optionee’s
heirs, executors, administrators, legal representatives, successors and
assigns.

 

                             13.          Governing Law. 
This Agreement shall be governed by and construed in accordance with the
internal laws of the State of California, without regard to that body of law
pertaining to choice of law or conflict of law.

 

                             14.          Acceptance. 
Optionee hereby acknowledges receipt of a copy of this Agreement.  Optionee has read and understands the terms
and provisions thereof, and accepts this Option subject to all the terms and
conditions of this Agreement.  Optionee
acknowledges that there may be adverse tax consequences upon exercise of this
Option or disposition of the Shares and that the Company has advised Optionee
to consult a tax advisor prior to such exercise or disposition.

 

                             15.          Modification, Extension or Renewal.  The Committee may modify, extend
or renew this Option and authorize the grant of new options in substitution
therefor, provided that any such action may not, without the written consent of
the Optionee, impair any of such Optionee’s rights under this Option.  The Committee may reduce the Exercise Price
of this Option without the consent of the Optionee affected by a written notice
to them; provided, however, that the Exercise Price may not be
reduced below 85% of the Fair Market Value of the Shares on the date of grant.

 

                             16.          Certificates.  All certificates for Shares or
other securities delivered upon exercise of this Option will be subject to such
stock transfer orders, legends and other restrictions as the Committee may deem
necessary or advisable, including restrictions under any applicable federal,
state or foreign securities law, or any rules, regulations and other
requirements of the SEC or any stock exchange or automated quotation system
upon which the Shares may be listed or quoted.

 

                             17.          Adjustment of Shares.  In the event that the number of outstanding
shares is changed by a stock dividend, recapitalization, stock split, reverse
stock split, subdivision, combination, reclassification or similar change in
the capital structure of the Company without consideration, then the Exercise
Price of and the number of Shares subject to this Option will be
proportionately adjusted, subject to any required action by the Board or the
Optionee and 

 

 

5

 

 

compliance with
applicable securities laws; provided, however, that fractions of
a Share will not be issued but will either be replaced by a cash payment equal
to the Fair Market Value of such fraction of a Share or will be rounded up to
the nearest whole Share, as determined by the Committee.

 

                             18.          Corporate Transactions.

 

                                             18.1            Assumption or Replacement of Option by Successor.  In the event of (a) a dissolution or liquidation
of the Company, (b) a merger or consolidation in which the Company is not
the surviving corporation (other than a merger or consolidation with a
wholly-owned subsidiary, a reincorporation of the Company in a different
jurisdiction, or other transaction in which there is no substantial change in
the stockholders of the Company or their relative stock holdings and this
Option is assumed, converted or replaced by the successor corporation, which
assumption will be binding on the Optionee), (c) a merger in which the Company
is the surviving corporation but after which the stockholders of the Company
immediately prior to such merger (other than any stockholder that merges, or
which owns or controls another corporation that merges, with the Company in such
merger) cease to own their shares or other equity interest in the Company, (d)
the sale of substantially all of the assets of the Company, or (e) the
acquisition, sale, or transfer of more than 50% of the outstanding shares of
the Company by tender offer or similar transaction, this Option may be assumed,
converted or replaced by the successor corporation (if any), which assumption,
conversion or replacement will be binding on the Optionee.  In the alternative, the successor
corporation may substitute equivalent options or provide substantially similar
consideration to the Optionee as was provided to other stockholders.  The successor corporation may also issue, in
place of outstanding Shares of the Company held by the Optionee, substantially
similar shares or other property subject to repurchase restrictions no less
favorable to the Optionee.  In the event
such successor corporation (if any) refuses to assume or substitute this
Option, as provided above, pursuant to a transaction described in this
subsection, this Option will expire on such transaction at such time and on
such conditions as the Committee will determine; provided, however,
that the Committee may, in its sole discretion, provide that the vesting of
this Option will accelerate.  If the
Committee exercises such discretion with respect to this Option, this Option
will become exercisable in full prior to the consummation of such event at such
time and on such conditions as the Committee determines, and if this Option is
not exercised prior to the consummation of the corporate transaction, it shall
terminate at such time as determined by the Committee.

 

                                             18.2         Other Treatment of Option.  Subject to any greater rights granted to the
Optionee under the foregoing provisions of this section, in the event of the
occurrence of any transaction described in Section 18.1, this Option will be
treated as provided in the applicable agreement or plan of merger,
consolidation, dissolution, liquidation, or sale of assets.

 

                             19.          Amendment or Termination of the
Agreement.  The Board may
at any time terminate or amend this Agreement in any respect; provided, however,
that the Board will not, without the approval of the Optionee, amend this
Agreement in any manner that requires Optionee’s approval.

 

 

6

 

 

                             20.          Definitions.   As used in this Agreement, the following terms will have the
following meanings:

 

                                             “Board” means the
Board of Directors of the Company.

 

                                             “Cause” means the
commission of an act of theft, embezzlement, fraud, dishonesty or a breach of
fiduciary duty to the Company or a Parent or Subsidiary of the Company.

 

                                             “Committee” means the
Compensation Committee of the Board.

 

                                             “Disability” means a
disability, whether temporary or permanent, partial or total, within the
meaning of Section 22(e)(3) of the Internal Revenue Code of 1986, as amended,
as determined by the Committee.

 

                                             “Fair Market Value”
means, as of any date, the value of a share of the Company’s Common Stock
determined as follows:

 

                                                                                      (a)           if
such Common Stock is then quoted on the Nasdaq National Market, its closing
price on the Nasdaq National Market on the date of determination as reported in
The Wall Street Journal;

 

                                                                                      (b)           if
such Common Stock is publicly traded and is then listed on a national securities
exchange, its closing price on the date of determination on the principal
national securities exchange on which the Common Stock is listed or admitted to
trading as reported in The Wall Street Journal;

 

                                                                                      (c)           if
such Common Stock is publicly traded but is not quoted on the Nasdaq National
Market nor listed or admitted to trading on a national securities exchange, the
average of the closing bid and asked prices on the date of determination as
reported in The Wall Street Journal; 
or

 

                                                                                      (d)           if
none of the foregoing is applicable, by the Committee in good faith.

 

                                             “Parent” means any
corporation (other than the Company) in an unbroken chain of corporations
ending with the Company if each of such corporations other than the Company
owns stock possessing 50% or more of the total combined voting power of all
classes of stock in one of the other corporations in such chain.

 

                                             “Subsidiary” means any
corporation (other than the Company) in an unbroken chain of corporations
beginning with the Company if each of the corporations other than the last
corporation in the unbroken chain owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain.

 

 

7

 

 

                                             “Termination” or “Terminated” means,
for purposes of this Agreement with respect to the Optionee, that the Optionee
has for any reason ceased to provide services as an employee, officer,
director, consultant, independent contractor, or advisor to the Company or a
Parent or Subsidiary of the Company.  An
employee will not be deemed to have ceased to provide services in the case of
(i) sick leave, (ii) military leave, or (iii) any other leave of
absence approved by the Committee, provided, that such leave is for a period of
not more than 90 days, unless reemployment upon the expiration of such leave is
guaranteed by contract or statute or unless provided otherwise pursuant to
formal policy adopted from time to time by the Company and issued and promulgated
to employees in writing.  In the case of
the Optionee is on an approved leave of absence, the Committee may make such
provisions respecting suspension of vesting of this Option while on leave from
the employ of the Company or a Subsidiary as it may deem appropriate, except
that in no event may this Option be exercised after the expiration of the term
set forth in this Agreement.  The
Committee will have sole discretion to determine whether the Optionee has
ceased to provide services and the effective date on which the Optionee ceased
to provide services (the “Termination Date”).

 

IN WITNESS WHEREOF, the Company has caused this Agreement
to be executed in duplicate by its duly authorized representative and Optionee
has executed this Agreement in duplicate as of the Date of Grant.

 

	
  SILICON IMAGE, INC.

  	
   

  	
  OPTIONEE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Robert Gargus

  	
   

  	
  John LeMoncheck

  
	
  Chief Financial Officer

  	
   

  	
   

  

 

 

 

8<Page>

                                                                    EXHIBIT 10.2

                                   RANCH LEASE

     This lease is made and entered into this _______ day of November, 1999, by
and between Seven J Stock Farm, Inc. , a Texas corporation, referred to in this
lease as Lessor, and the J. R. Parten Ranch Trust, referred to in this lease as
Lessee.

                      ARTICLE 1. DEMISE OF LEASED PREMISES

     In consideration of the mutual covenants and agreements set fourth in this
lease, and other good and valuable consideration, Lessor does hereby demise and
lease to Lessee, and: Lessee does hereby lease from Lessor, approximately 8,500
acres of Seven J Stock Farm land located in the John Durst Survey, A-29, Ignacio
Lopez League A-50, and Barton Clark League, A-23, Houston County, Texas, and
more particularly described in Article 2 below. These premises are referred to
in this lease as "the Premises" or "the Leased Premises".

     Lessee is to have and to hold the Leased Premises together with all rights,
privileges, easements, appurtenances, and immunities belonging to or in any way
appertaining to the Leased Premises, including, but not limited to any and all
easements, rights, title, and privileges of Lessor, existing now or in existence
at any time during the lease term.

                    ARTICLE 2. DESCRIPTION OF LEASED PREMISES

     2.01   The Premises herein leased shall be all of the Seven J Stock Farm
acreage located in Houston County, Texas, and outlined in red on the map
included as Exhibit "A" hereto, except those areas specifically excluded in
Article 3 below.

     2.02   The net acreages for each pasture shall be those shown on Exhibit
"B" attached hereto.

     2.03   Lessee shall have free access over any of Lessor's unleased land and
roadways to gain proper access to the Leased Premises.

     2.04   Lessor, its tenants, its agents, and its tenants' agents shall have
free access over any of the Leased Premises and the roadways thereon to gain
proper access to unleased areas, oil and gas wells, compressor stations,
pipelines, storage yards and all other activities conducted on the Seven J Stock
Farm.

                       ARTICLE 3. LAND EXCEPTED FROM LEASE

     All land and improvements included in Exhibit "B" hereto are leased except
those specifically excluded in this article.

     3.01   Farmland: There is excluded from this lease the following pastures
which are leased to other persons for cropland:

            Prairie Field               Pin Oak Field
            Lower Bottom North          Big Creek
            Lower Bottom South          Alfalfa Field
            East Rice Field             Clover field
            Cochran Farm                Patterson Lake
            Cochran Field               North Mississippi Hill
            North Cochran Farm

                                     Page 1
<Page>

     3.02   Grazing: There is excluded from this lease the pastures which are
leased to other persons for grazing:

            N. Wolf Den                 Jackson Bottom Farm
            Wolf Den Meadow             Horse Trap
            Stumpville                  West Trap
            Petty Place                 East Trap
            N. McDougald Place          "L" Trap
            Jackson Place               Hay Trap

     3.03   Buildings: The following buildings, as shown on Exhibit "C", are
excluded from this lease:

            Commissary
            Office Building
            Feed Mill - Pecan Plant
            Mill Barn
            Mill Shop
            Gin Building
            Mill Quonset

     3.04   Gas Plant: There is excluded from this lease, the two acres
currently fenced and used by Rainbow Pipe Line Company, Madison Pipe Line
Company, TXU Gas Distribution and Copano Energy Services, immediately east of
Headquarters.

     3.05   House: There is excluded from this lease the following houses: the
manager's residence.

     3.06   Equipment Yards: There is excluded from this lease the two pipe
yards used by Parten Operating Inc. located at Seven J #14 and at Seven J D-1.

     3.07   Compressor Station: There is excluded from this lease the two acres
currently fenced and used by Parten Operating Inc. at Seven J #20.

     3.08   Levee Pumpouts: There is excluded from this lease the two pumping
stations used for removal of floodwaters during times of overflow.

                                   ARTICLE 4.

     [Intentionally Blank]

                             ARTICLE 5. LEASE TERMS

                     Fixed Commencement and Termination Date

     5.01   This lease shall be for a term of (60 months) referred to as the
lease term, commencing on November 1, 1999, and ending on October 31, 2004,
subject, however to earlier termination as provided in this lease.

                                 Right to Extend

     5.02   Lessee will have the right and the option, but no duty to renew and
extend this Lease for an additional five-year term. Rent may be adjusted as
specified in paragraph 6.02 below at the option of Lessor. Lessor shall give
Lessee notice of the proposed rental rate (not to exceed the adjustment
specified in paragraph 6.02) no later than 180 days before the expiration of the
lease term. Lessee shall notify Lessor no later than 120 days before the
expiration of the lease term if he chooses to exercise his option. If notice is
not given of the new rate as specified above, then Lessor shall be deemed to
have offered to re-lease the property at the current rate specified herein.

                                     Page 2
<Page>

                                   Termination

     5.03   This lease shall terminate and become null and void without further
notice on the expiration of the term specified in paragraph 5.01, and any
holding over by Lessee after the expiration of that term, other than as provided
in paragraph 5.02, shall not constitute a renewal of the lease or give Lessee
any rights under the lease in or to the Leased Premises.

                                 ARTICLE 6. RENT

                                   Yearly Rent

     6.01   Lessee agrees to pay to Lessor Sixteen Dollars ($16.00) per net acre
during the term of this lease as annual rent for the use and occupancy of the
Leased Premises. This amount will be known as the "yearly rent". Net acreage
shall be as shown on Exhibit "B" and may be adjusted from time to time if
acreage is added or dropped by mutual agreement.

                          Automatic Rental Adjustments

     6.02   At the end of the lease term, the yearly rent may be adjusted as set
forth in this section to reflect increases in the Consumer Price Index of the
Bureau of Labor Statistics of the United States Department of Labor for all
items, Houston and Galveston, Texas (CUURA318SAO) (referred to in this Section
as "CPI-U"), using 1998 as the base year. The index numbers referred to in
Subsection (a) below will be taken from this consumer price index, except as set
forth in Subsection (b) below.

       a.   The adjustment in the yearly rent shall be determined by multiplying
            ($16.00) by a fraction, the denominator of which is the index number
            for October, 1999, and the numerator of which is the index number
            for October, 2004. If the product of this multiplication is greater
            than the minimum yearly rent or $16.00. Lessee shall pay this
            greater amount as the yearly rent until the time of the next rental
            adjustment as called for in this section. If the product of this
            multiplication is less than $16.00, there shall be no adjustment in
            the annual rent at that time, and Lessee shall pay yearly rent of
            $16.00. In no event shall any rental adjustment called for in this
            section result in an annual rent less than $16.00.

       b.   If the CPI-U is discontinued during the term of this lease, the
            remaining rental adjustments called for in this section shall be
            made using the formula set forth in Subsection (a) above, but
            substituting statistics of the Bureau of Labor Statistics of the
            United States Department of Labor that are most nearly comparable to
            the consumer price index specified in first paragraph of this
            section. If the Bureau of Labor Statistics of the United States
            Department of Labor ceases to exist or ceases to publish statistics
            concerning the purchasing power of the consumer dollar during the
            term of this lease, the remaining rental adjustments called for in
            this section shall be made using the most nearly comparable
            statistics published by a recognized financial authority selected by
            Lessor.

                           Time and Manner of Payment

     6.03   All rent due under this article shall be paid by Lessee as follows:
Rental for each month beginning in November, 1999, shall be due and payable on
or before the last day of the month for which the rent is due.

     All installments of rent shall be paid in lawful money of the United States
to Lessor, at Lessor's address specified below.

                            Additional Consideration

     6.04   As additional consideration to the Lessor for entering this Lease,
Lessee agrees to perform the following operations on the Leased Premises:

       a.   Weed Control: Lessee will mow or spray with herbicide every acre
            of pastureland of the Leased Premises each year of this lease. In
            the event, Lessee opts to use herbicide for weed control; he will
            take all precautions to prevent damage to growing crops, ground
            water or surface.

                                     Page 3
<Page>

       b.   Soil Maintenance: Lessee will spread lime (at the rate of 1 ton per
            acre) on all of the pastureland of the Leased Premises over the
            five-year term. Lessee shall apply the lime to 1/5 of the
            pastureland per year of the lease. A year shall be measured from one
            anniversary date to the next.

                               Liquidated Damages

     6.05   If Lessee fails to perform the weed control or soil maintenance
programs specified in 6.04 above, the damages to Lessor's land will be difficult
or impossible to measure. If Lessee fails to mow or spray all of the pastureland
of the Leased Premises each year, Lessee shall pay to Lessor the sum of $6.50
per acre (or the current area custom rate) for each acre not treated. Likewise,
if Lessee fails to lime the required amount of land each year Lessee shall pay
to Lessor $21.00 for each acre (or current liming cost of one ton per acre plus
spreading) which his actual treatment falls short of the requirements set out in
6.04 above. No charge for liquidated damage shall be made if Lessee is in
substantial compliance with the requirements. Lessee shall be considered to be
in substantial compliance in any year if Lessee has performed more than 90% of
the required program.

                                   Information

     6.06   Lessee shall furnish to Lessor each December 15th with an annual
report showing work done with copies of invoices showing the area limed, the
number acres, amount spread per acre, and the cost. Likewise, Lessee shall
furnish to Lessor a statement showing the area limed , the number acres, amount
spread per acre and the costs likewise. Lessee shall furnish to Lessor a
statement showing the areas mowed or sprayed during that annual period.

                                ARTICLE 7. TAXES

                                Payment by Lessor

     7.01   Lessor shall pay all ad valorem taxes on the property herein leased.

                              ARTICLE 8. UTILITIES

     8.01   Lessee shall pay or cause to be paid all charges for water, heat,
electricity, and all other utilities used on the Leased Premises throughout the
term of this lease, including any connection fees.

     8.02   Lessee will maintain the water system (except down-hole well
equipment) on the property and furnish water for domestic purposes to all of
Lessor's buildings (including buildings excluded from this lease).

     8.03   Lessor, at its expense, shall make all necessary repairs to the
water well bores and down-hole equipment.

                           ARTICLE 9. USE OF PREMISES

                                 Primary Purpose

     9.01   Lessee shall use the Leased Premises for ranching purposes and crops
incident thereto.

                                     Page 4
<Page>

                            Illegal Use Not Permitted

     9.02   Lessee agrees not to use all or part of the Leased Premises or any
building situated upon the Leased Premises for any use or purpose in violation
of any valid and applicable law, regulation, or ordinance of the United States,
the State of Texas, County of Houston, or other lawful authority having
jurisdiction over the Leased Premises: provided, however, that there shall be no
violation by Lessee of this provision unless and until Lessor has notified
Lessee in writing, specifying the alleged violation and until there has been a
final adjudication that the specified use is in violation of the law, regulation
or ordinance specified in the written notice, and that the specified law,
regulation, or ordinance is valid and applicable to the Leased Premises, and
until Lessee has had a reasonable time after the final adjudication to cure the
specified violation.

              Violation of Environmental Regulations Not Permitted

     9.03   Notwithstanding paragraph 8.02, Lessee agrees not to knowingly
violate any Environmental Law through activities conducted by Lessee on the
Leased Premises.

                   Indemnification for Environmental Liability

     9.04   Notwithstanding paragraph 9.02, Lessee agrees to defend, indemnify,
and hold harmless Lessor from and against all ENVIRONMENTAL CLAIMS arising from
or related to Lessee's uses of the Leased Premises, including but not limited to
violations of section 404 of the Federal Clean Water Act, 33 U.S.C. 1344.

     "ENVIRONMENTAL LAW" means any federal, state or local statute, law, rule,
regulation, ordinance code, policy or rule of common law and any judicial or
administrative interpretation thereof, including any judicial or administrative
order, consent decree, or judgment, relating to the environment, health or
hazardous materials, including, without limitation the comprehensive
Environmental Response Compensation, and Liability Act of 1980, as amended, 42
U.S.C. 9601, et seq.; the Hazardous Materials Transportation Act, as amended, 49
U.S.C. 1801, et seq.; the Resource Conservation and Recovery act of 1976, as
amended, 42 U.S.C. 6901, et seq.; the Federal Clean Water Act, as amended, 33
U.S.C. 1201, et seq.; the Toxic Substances Control Act, 15 U.S.C. 2601, et seq.;
the Clean Air Act, 42 U.S.C. 7401, et seq.; the Safe Drinking Water Act, 42
U.S.C. 3808, et seq.; and including without limitation any and all Texas state,
local, municipal, or common laws.

     "DREDGED MATERIAL" means "material that is excavated or dredged from the
waters of the United States," including such waters that are wetland areas. 33
C.F.R. 323.3(c).

     "FILL MATERIAL" means "any material used for the primary purpose of
replacing an aquatic area with dry land or of changing the bottom elevation of
any waterbody." 33 C.F.R. 323.3(e).

     "WETLAND" means "those areas that are inundated or saturated by surface or
ground water at a frequency and duration sufficient to support, and that under
normal circumstances do support, a prevalence of vegetation typically adapted
for life in saturated soil conditions." 33 C.F.R. 328.3(b). Additionally,
"WETLAND" means any area over which the U.S. Army Corps of engineers has a
jurisdiction pursuant to section 404 of the clean Water Act, the applicable
regulations and the Federal Manual for Identifying and Delineating
Jurisdictional Wetlands, Federal Interagency Committee for Wetland Delineation
(1989).

     "DISCHARGE OF DREDGED MATERIAL", "DISCHARGE OF FILL MATERIAL", and "WATERS
OF THE UNITED STATES" shall for purposes of this lease carry the definitions
given in 33 C.F.R. 323.3(d), 33 C.F.R. 323.3(f), and 33 C.F.R. Part 328,
respectively.

     "ENVIRONMENTAL CLAIMS" means any and all liabilities, responsibilities,
claims, suits, losses, costs (including remedial, removal, response, abatement,
cleanup, investigative and/or monitoring costs and any other related costs and
expenses), other causes of action recognized now or at any later time, damages,
settlements, penalties, fines, legal fees, and other expenses which are incurred
by, asserted against, or imposed upon Lessor pursuant to any agreement, order,
notice of responsibility, directive (including directives embodied in
ENVIRONMENTAL LAWS), injunction, judgment or similar document (including
settlements)

                                     Page 5
<Page>

issued by a court of competent jurisdiction or any federal, state, or local
governmental entity or agency, or pursuant to any claim by a governmental agency
or any person for personal injury, property damage, damage to natural resources,
remediation, or payment or reimbursement of response costs incurred or expended
by said governmental agency or person pursuant to common law or statute.

                              ARTICLE 10. EQUIPMENT

     10.01  None of Lessor's equipment is subject to this lease except by
subsequent mutual agreement of the parties.

                       ARTICLE 11. CONSTRUCTION BY LESSEE

                               General Conditions

     11.01  Lessee shall have the right at any time and from time to time during
the term of this lease, to erect, maintain, alter, remodel, reconstruct,
rebuild, replace, and remove building and other improvements on the Leased
Premises, and correct and change the contour of the Leased Premises, subject to
prior approval of the Lessor. The following general conditions shall apply:

       a.   The cost of any such work shall be borne and paid for by Lessee.

       b.   The Leased Premises shall at all times be kept free of mechanics and
            materialmen's liens.

       c.   Lessor shall be notified of the time of commencement and the general
            nature of any such work, other than routine maintenance of existing
            buildings or improvements, at the time of commencement.

               Ownership of Buildings, Improvements, and Fixtures

     11.02  Any and all buildings, improvements, additions, alterations and
fixtures, except furniture and trade fixtures, constructed, placed, or
maintained on any part of the Leased Premises during the lease term shall be
considered part of the real property of the Premises and shall remain on the
Premises and become the property of Lessor on termination of this lease.

                          Right to Remove Improvements

     11.03  Lessee shall have the right at any time during Lessee's occupancy of
the Leased Premises, or within a reasonable time thereafter, to remove any and
all furniture, machinery, equipment, or other trade fixtures, owned or placed by
Lessee its sublessees or licensees, in, under, on the Leased Premises, or
acquired Lessee, whether before or during the lease term, but prior to the
termination of the lease Lessee must repair any damage to any buildings or
improvements on the Premises resulting from their removal, Any such items which
are not removed by the termination date of the lease shall become the property
of Lessor as of that date.

                            ARTICLE 12. FLOOD CONTROL

     12.01  Lessor shall remain responsible for maintenance of the levee system;
main drainage ditches and for maintenance and operation of the two pumping
stations used to protect the bottomland from floodwaters. Lessor shall bill to
Lessee part of its cost for this service, annually on May 1, each year. The part
billed shall be Lessor's actual cost multiplied by a fraction, the numerator of
which shall be the number of Lessee's acres protected by the system. The
denominator shall be the total number of net acres protected by the system.
Lessor shall not spend more than $10,000 in any one year maintaining the system.

                            ARTICLE 13. HUNTING LEASE

     13.01  Lessee will not allow hunting on the Leased Premises.

                                     Page 6
<Page>

                                   ARTICLE 14.

     [Intentionally Blank]

                ARTICLE 15. REPAIRS, MAINTENANCE, AND RESTORATION

                      Lessee's Duty to Maintain and Repair

     15.01  At all times during the term of the lease, Lessee will keep and
maintain, or cause to be kept and maintained, all buildings and improvements
which may be erected on the Leased Premises in a good state of appearance and
repair, reasonable wear and tear accepted, at Lessee's own expense.

                              Damage or Destruction

     15.02  In the event any building or improvement constructed on the Leased
Premises is damaged or destroyed by fire or any other casualty, regardless of
the extent of such damage or destruction, Lessee shall, within one year from the
date of such damage or destruction, begin to repair, reconstruct, or replace the
damage or destroyed building or improvement and pursue the repair,
reconstruction, or replacement with reasonable diligence so that the building
shall be restored to substantially the condition it was in prior to the
happening of the casualty: provided, however, that if commencement or completion
of this restoration is prevented or delayed by reason of war, civil commotion,
acts of God, strikes, governmental restrictions or regulations, or
interferences, fire or other casualty, or any other reason beyond the control of
Lessee, whether similar to any of those enumerated or not, the time for
commencing or completing, or both, of the restoration will automatically be
extended for the period of each such delay.

                            Fences and Water Systems

     15.03  Lessee shall repair and maintain all fencing and water systems on
the Leased Premises in such a manner as to keep it in a good condition as it is
at the beginning of the lease term, normal wear and tear excepted.

                          ARTICLE 16. MECHANICS' LIENS

     16.01  Lessee shall not cause or permit any mechanics' liens or other liens
to be filed against the fee of the Leased Premises or against Lessee leasehold
interest in the land or any buildings or improvements on the Leased Premises by
reason of any work, labor, services, or material supplied or holding the Leased
Premises or any part of them through or under Lessees, If such a mechanic's lien
or materialman's lien is recorded against the Leased Premises or any buildings
or improvements on the Premises, Lessee shall either cause the same to be
removed or, if Lessee in good faith desires to contest the lien, take timely
action to do so, at Lessee's sole expense. If Lessee contests the lien, Lessee
agrees to indemnify Lessor and hold Lessor harmless from all liability for
damages occasioned by the lien or the lien contest and shall, in the even of a
judgment or foreclosure on the lien, cause the lien to be discharged and removed
prior to execution of the judgment.

                        ARTICLE 17. DEFAULT AND REMEDIES

                             Termination on Default

     17.01  Should Lessee default in the performance of any covenant, condition,
or agreement to this lease, and not correct the default within thirty (30) days
after receipt of written notice from Lessor to Lessee and any lender, Lessor may
declare this lease, and all rights and interest created by it, to be terminated.
Upon Lessor's electing to terminate, this lease shall cease and come to an end
as if the day of Lessor's election were the day originally fixed and the lease
for its expiration. Lessee shall have 120 days to remove cattle during which
time no additional rental will be due, Lessor or Lessor's agent or attorney may
resume possession of the Premises.

                                     Page 7
<Page>

                                 Other Remedies

     17.02  Any termination of this lease as provided in this article shall not
relieve Lessee from the payment of any sum or sums that are due and payable to
Lessor under the lease at the time of termination, or any claim for damages then
or previously accruing against Lessee under this lease, and any such termination
shall not prevent Lessor from enforcing the payment of any such sum or sums or
claim for damages by any remedy provided for by law, or from recovering damages
from Lessee or any default under the lease. All rights, options, and remedies of
Lessor contained in this lease shall be construed and held to be cumulative, and
no one of them shall be exclusive of the other, and Lessor shall have the right
to pursue any one or all of such remedies or any other remedy or relief which
may be provided by law, whether or not stated in this lease. No waiver by Lessor
of a breach of any of the covenants, conditions, or restrictions of this lease
shall be construed or held to be a waiver of any succeeding or preceding breach
of the name or any other covenant, conditions, or restriction contained in this
lease.

                               Liquidated Damages

     17.03  Notwithstanding anything contained in this lease to the contrary,
due to the difficulty and uncertainty in measuring damages, in the event that
either party breaches the lease resulting in termination of the lease, it is
agreed that damages from loss of future revenue (on the part of Lessor) or loss
of future pasture use (on the part of the Lease) shall be a sum of money equal
to six months of rent based upon the monthly rate that was in effect at the time
of termination of the lease.

                       ARTICLE 18. LESSOR'S WARRANTIES AND
                                    COVENANTS

                                Warranty of Title
     18.01  Lessor hereby represents and warrants that it is the owner in fee
simple absolute of the Leased Premises.

                           Warranty of Quiet Enjoyment

     18.02  Lessor covenants and agrees that as long as Lessee pays the rent and
other charges as provided in this lease and observes and keeps the covenants,
conditions, and terms of this lease, Lessee shall lawfully and quietly hold,
occupy, and enjoy the Leased Premises during the term of this lease without
hindrance or molestation, by Lessor or any person claiming under Lessor, except
such portion of the Leased Premises, if any, a shall be taken under the power of
eminent domain.

                    ARTICLE 19. GENERAL PROTECTIVE PROVISIONS

                          Right of Entry and Inspection

     19.01  Lessee shall permit Lessor or Lessor's agents, representatives, or
employees to enter on the Leased Premises for the purposes of inspection,
determining whether Lessee is in compliance with the terms of this lease,
maintaining, repairing, or altering the Premises, or showing the Leased Premises
to prospective Lessees, purchasers, mortgages, or beneficiaries under trust
deeds.

                         No Partnership or Joint Venture

     19.02  The relationship between Lessor and Lessee at all times shall remain
solely that of landlord and tenant and not be deemed a partnership or a joint
venture.

                                  Force Majeure

     19.03  It is expressly understood and agreed that if the curing of any
default (other than failure to pay rent) or the performance of any other
covenant, agreement, obligation, or undertaking contained in this lease is
delayed by reason of war, civil commotion, act of God, governmental
restrictions, regulations, or interference, fire or other casualty, or any other

                                     Page 8
<Page>

circumstances beyond Lessee's control or beyond the control of the party
obligated or permitted under the terms of this ease to do or perform the same,
regardless of whether any such circumstance is similar to any of those
enumerated or not, each party so delayed shall be excused from doing or
performing the same during the period delay.

                          No Termination on Bankruptcy

     19.04  Neither bankruptcy, insolvency, assignment for the benefit of
creditors, nor the appointment of a receiver shall affect this lease so long as
Lessee and Lessor or their respective successors or legal representatives
continue to perform all covenants of this lease.

                                    No Waiver

     19.05  No waiver by either party of any default or breach of any covenant,
condition, or stipulation contained in this lease shall be treated as a waiver
of any subsequent default or breach of the same or any other covenant,
condition, or stipulation of this lease.

                                Release of Lessor

     19.06  If Lessor sells or transfers all or part of the Leased Premises and
as a part of the transaction assigns its interest as Lessor in and to this
lease, then from and after the effective date of the sale, assignment, or
transfer, Lessor shall have no further liability under this lease to Lessee,
except as to matters of liability which have accrued and are unsatisfied as of
that date, it being intended that the covenants and obligations of Lessor
contained in this lease shall be binding on Lessor and its successors and
assigns only during and in respect of their respective successive periods of
ownership of the fee.

                               Mineral Development

     19.07  Lessor retains the right to allow current or future owners of the
mineral leasehold estate to proceed with development of the Premises, including
but not limited to future well locations, roadways, and pipeline rights-of-way.
Any compensation received by Lessor shall be divided as follows:

       a.   Amounts paid which represent recurring or continuous use of the land
            shall go to Lessor.

       b.   Amounts paid which represent payment for damage to growing crops or
            livestock shall go to Lessee.

                            ARTICLE 20. MISCELLANEOUS

                          Delivery of Rents and Notices

     20.01  All rents or other sums, notices, demands, or requests from one
party to another may be personally delivered or sent by mail, certified or
registered, postage prepaid, to the addressee stated in this section and shall
be deemed to have been given at the time of personal delivery or at the time of
mailing.

     All payments, notices, demands, or requests from Lessee to Lessor shall be
given or mailed to Lessor at 16945 Northchase Drive, Suite 1800, Houston, Texas,
77060-2151.

     All payments, notices, demands, or requests from Lessor to Lessee shall be
given or mailed to Lessee at Rt. 2, Box 264-A, Crockett, Texas 75835, or at such
other address as requested by Lessee in writing.

                                  Parties Bound

     20.02  This agreement shall be binding upon and insure to the benefit of
the parties to the lease and their respective heirs, executors, administrators,
legal representatives, successors and assigns.

                                     Page 9
<Page>

                               Texas Law to Apply

     20.03  This agreement shall be construed under and in accordance with the
laws of the Sate of Texas, and all obligations of the parties created by this
lease are performable in Houston County, Texas.

                               Legal Construction

     20.04  In case any one or more of the provisions contained in this
agreement shall for any reason be held to be invalid, illegal, or unenforceable
in any respect, this invalidity, illegality, or unenforceability shall not
affect any other provision of the lease, and this agreement shall be construed
as if the invalid, illegal or inenforceable provision had never been contained
in the lease.

                           Prior Agreements Superseded

     20.05  This agreement constitutes the sole and only agreement of the
parties to the lease of the land described in Article 2 above and superseded any
prior understandings or written or oral agreements between the parties
respecting the subject matter of the lease.

                                    Amendment

     20.06  No amendment, modification, or alteration of the terms of this lease
shall be binding unless it is in writing, dated subsequent to the date of this
lease, and only executed by the parties to this lease.

                         Rights and Remedies Cumulative

     20.07  The rights and remedies provided by this lease agreement are
cumulative, and the use of any one right or remedy by either party shall not
preclude or waive its right to use any or all other remedies. The rights and
remedies provided in this lease are given in addition to any other rights the
parties may have by law, statute, ordinance, or otherwise.

                            Attorney's Fees and Costs

     20.08  If, as a result of a breach of this agreement by either party, the
other party employs an attorney or attorneys to enforce its rights under this
lease, then the breaching party agrees to pay the other party the reasonable
attorney's fees and costs incurred to enforce the lease.

                                 Time of Essence

     20.09  Time is of the essence of this agreement.

                                Further Documents

     20.10  Lessor agrees that it will from time to time and at any reasonable
time execute and deliver to Lessee other and further instruments and assurances
as Lessee may reasonably request, approving, ratifying, and confirming this
lease and the leasehold estate created by this lease and certifying that the
lease is in full force and effect and that no default under the lease on the
part of Lessee exists, except, that if any default on the part of Lessee does
exist, Lessor shall specify in any such instrument each such default.

                                     Page 10
<Page>

     THIS LEASE has been executed by the parties on the date and year first
above written.

                                     LESSOR:

                                     SEVEN J STOCK FARM, INC.

                                     By
                                       ----------------------------
                                     JOHN R. PARTEN, President

                                     LESSEE:

                                     J. R. PARTEN RANCH TRUST

                                     By,
                                        ---------------------------
                                     JOHN R. PARTEN, Co-Trustee

                                     By,
                                        ---------------------------
                                     ROBERT F. PRATKA, Co-Trustee

                                     Page 11
<Page>

THE STATE OF TEXAS ( )

COUNTY OF HARRIS   ( )

          Before me, the undersigned authority, on this day personally appeared
John R. Parten as President of Seven J Stock Farm, Inc., a Texas corporation,
and acknowledged to me that he executed the same for the purposes and
consideration therein expressed, in the capacity stated, and as the act and deed
of said corporation.

          Given under my hand and seal of office this the _______day of _______,
2000

My Commission Expires:                         ____________________________
                                               Notary Public in and for the
__________________                             State of Texas

THE STATE OF TEXAS ( )

COUNTY OF HARRIS   ( )

          Before me, the undersigned authority, on this day personally appeared
John R. Parten, Co-Trustee of the J. R. Parten Ranch Trust, and acknowledged to
me that he executed the same for the purposes and consideration therein
expressed, in the capacity stated, and as the act and deed of said corporation.

          Given under my hand and seal of office this ______ day of ___________,
2000.

My Commission Expires:                         ____________________________
                                               Notary Public in and for the
__________________                             State of Texas

THE STATE OF TEXAS ( )

COUNTY OF HARRIS   ( )

          Before me, the undersigned authority, on this day personally appeared
Robert F. Pratka, Co-Trustee of the J. R. Parten Ranch Trust, and acknowledged
to me that he executed the same for the purposes and consideration therein
expressed, in the capacity stated, and as the act and deed of said corporation.

          Given under my hand and seal of office this ______ day of ___________,
2000.

My Commission Expires:                         ____________________________
                                               Notary Public in and for the
__________________                             State of Texas

                                     Page 12
<Page>

                                   EXHIBIT "B"

                           SEVEN J STOCK FARM ACREAGE

<Table>
<Caption>
                                                             NET ACRES
            ----------------------------------------------------------
            <S>                                         <C>
            River Pasture                                       269.37
            Bridge Pasture                                      181.66
            Prairie Field Trap                                   49.37
            Milk Cow Trap                                         6.40
            Mare Trap                                            12.57
            Headquarters East                                    45.92
            Garden Trap                                           9.60
            Bull Trap                                             7.31
            Milk Cow Pasture                                     12.20
            South Wolf Den                                      333.31
            Central Wolf Den                                    238.56
            Creek Pasture                                       333.00
            Gin Lot Hill                                        265.66
            Cochran Trap                                        118.25
            Pin Oak Point                                       198.00
            North Miss. Hill                                    245.71
            Central Miss. Hill                                  224.56
            East Miss. Hill                                     302.91
            Miss Hill Meadow                                     98.00
            South Field Trap                                      9.14
            Feed Lots                                            11.00
            Bone Trap                                             5.49
            Barn Trap                                            36.57
            Brush Trap                                           23.77
            Sand Trap                                            11.43
            Big Field Trap                                       83.20
            Headquarters West                                    13.89
            Dry Lake                                            380.50
            McKenzie Knoll                                      303.43
            Snag Lake Pasture                                   320.59
            B & Boss                                            275.52
            Hay Field                                            60.40
            Patterson Lake Trap                                  18.74
            West Rice Field                                     176.54
            East Seed Field                                     179.08
            South Field 1                                       188.10
            West Big Field                                      206.75
            East Big Field                                      109.76
            North Bull Pasture                                   56.00
            South Bull Pasture                                   88.03
            West Bull Pasture                                    89.38
            ----------------------------------------------------------
            TOTAL                                              5510.29
            ----------------------------------------------------------
            ANNUAL RENTAL                               $    88,164.64
            ----------------------------------------------------------
            MONTHLY RENTAL                              $     7,347.00
            ==========================================================
</Table>

                                     Page 13

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