Document:

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                                                                   EXHIBIT 10.15

                                 Loan Agreement

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                               As of July 1, 2004

                                     Between

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BORROWER                                LENDER

BEHRINGER HARVARD QUORUM I LP           FIRST AMERICAN BANK, SSB
1323 North Stemmons Freeway, Suite 212  8401 North Central Expressway, Suite 500
Dallas, Texas  75201                    Dallas, Texas  75225
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        In consideration of the creation of the facility described below and the
mutual covenants and agreements contained herein, and intending to be legally
bound hereby, Lender and Borrower agree as follows:

                             SECTION 1. DEFINITIONS

        1.1 CERTAIN DEFINITIONS. In addition to any other terms defined herein,
the following terms shall have the meaning set forth with respect thereto:

        "ACCEPTABLE SWAP AGREEMENTS" means any SWAP Agreement having terms
satisfactory to Lender entered into with Persons as are satisfactory to Lender.

        "AGREEMENT" means this Loan Agreement and all subsequent modifications
and amendments hereto.

        "ASSIGNMENT OF MANAGEMENT AGREEMENTS": See SECTION 3.3.

        "BUDGET": See SECTION 2.9.

        "CALENDAR PERIOD" means any calendar month or months (i.e., three months
or twelve months), as the context in which such term is used or may suggest or
require.

        "CHASE BANK LEASE" means that certain Office Lease dated as of October
20, 2000, between Crescent Real Estate Funding VIII, L.P., as Landlord, and
JPMorgan Chase Bank (as successor in interest to The Chase Manhattan Bank), as
Tenant, as the same may have been amended prior to the date hereof and as the
same may be hereafter amended as permitted by the applicable SNDA, which Office
Lease is being assigned to Borrower pursuant to the Contract of Sale.

        "CLOSING DATE": See SECTION 4.

        "CONSTRUCTION CONSULTANT" means the construction consultant, if any,
engaged by Lender with respect to the Project.

        "CONTESTED IN GOOD FAITH" means, as to any payment, tax, assessment,
charge, levy, lien, encumbrance or claim, contesting the amount, applicability
or validity thereof in good faith by appropriate proceedings or other
appropriate actions promptly initiated and diligently conducted in a manner
satisfactory to Lender, provided (a) a deposit of funds or other security
satisfactory to Lender in the full amount of such contested payment, tax,
assessment, charge, levy, lien, encumbrance or claim has been provided for in a
manner satisfactory to Lender, and (b) the enforcement of the contested payment,
tax, assessment, charge, levy, lien, encumbrance or claim is stayed in a manner
satisfactory to Lender pending the resolution of such contest.

        "CONTRACT OF SALE" means the Purchase and Sale Contract dated April 2,
2004, between Crescent Real Estate Funding VIII, L.P., as Seller, and Harvard
Property Trust, LLC which assigned its interest therein to Borrower, as
Purchaser, relating to the Project, as amended from time to time.

        "CONTRACT RATE" means the WSJ Prime Rate, PROVIDED that in no event
shall the Contract Rate ever exceed the Maximum Rate or be less than four
percent (4%) per annum, and PROVIDED FURTHER, that after the occurrence of an
Event of Default, the Contract Rate shall at Lender's option be the Default Rate
with respect to all past due payments of principal and interest.

        "CRESCENT MANAGEMENT AGREEMENT" means that certain Property Management
Subcontract dated as of June ___, 2004, between HPT Management Services LP and
Crescent Property Services, Inc.

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        "DEED OF TRUST": See SECTION 3.1.

        "DEFAULT RATE" means the lesser of (a) the Maximum Rate or (b) the WSJ
Prime Rate plus six percent (6%).

        "DEPOSIT ACCOUNT SECURITY AGREEMENT": See SECTION 3.5.

        "DRAW REQUEST": See SECTION 5.2.

        "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and the regulations promulgated thereunder, as in effect as of the date
hereof and any subsequent provisions which are amendatory thereof, supplemental
thereto or substituted therefor. In addition, the terms "COMMONLY CONTROLLED
ENTITY," "MULTIEMPLOYER PLAN," "PBGC," "PLAN," "PROHIBITED TRANSACTION," and
"REPORTABLE EVENT" have the same meanings as provided therefor in ERISA.

        "EVENT OF DEFAULT": See SECTION 11.

        "EXCUSABLE DELAYS" means unusually adverse weather conditions which have
not been taken into account in the construction schedule, fire, earthquake or
other acts of God, strike, lockout, acts of public enemy, riot or insurrection
or any unforeseen circumstances or events (except financial circumstances or
events or matters which may be resolved by the payment of money) beyond the
control of Borrower, not to exceed ten (10) consecutive days in any one instance
or forty-five (45) days in total, provided Borrower shall notify Lender in
writing within five (5) days after such occurrence; and provided further that no
Excusable Delay shall suspend or abate any obligation of Borrower or any other
Loan Party to pay any money.

        "FIRST EXTENDED MATURITY DATE" means July 1, 2008.

        "GAAP" means generally accepted accounting principles as in effect from
time to time, applied on a basis consistent (except for changes approved by
Borrower's independent public accountant) with the most recent financial
statements of Borrower delivered to Lender.

        "GENERAL PARTNER" means Behringer Harvard Quorum I GP, LLC, a Texas
limited liability company.

        "GENERAL RESERVE ACCOUNT": See SECTION 3.5.

        "GROSS INCOME" means rentals, revenues and other cash forms of
consideration, received by, or paid to or for the account of or for the benefit
of, Borrower resulting from or attributable to the operation, leasing and/or
occupancy of the Project, determined on a cash basis (except as specified
herein), including, but not limited to, the following:

                (i) rents paid by any lessees or tenants of the Project;

                (ii) rents and receipts received by or for the benefit of
        Borrower with respect to licenses, concessions, vending machines,
        parking fees, and similar items relating to the Project;

                (iii) proceeds received by or for the benefit of Borrower in
        connection with any rental loss or business interruption insurance with
        respect to the Project;

                (iv) any other fees or rents collected by, for or on behalf of
        Borrower with respect to the occupancy, leasing and operating the
        Project, including common area maintenance, tax and insurance payments
        and payments under easements;

                (v) any refunds of deposits for obtaining, using or maintaining
        utility services for all or any portion of the Project;

                (vi) interest, if any, earned by Borrower on security and other
        type deposits of and advance rentals paid by, any lessees or tenants of
        the Project; and

                (vii) the amount of any security and other type deposits and
        advance rentals relating to the Project which have been forfeited or
        become non-refundable.

        Notwithstanding anything included within the above definition of Gross
Income, there shall be excluded from Gross Income the following: (i) any
security or other deposits of lessees and tenants, unless and until the same
actually are either applied to actual rentals owed or other charges or fees or
forfeited or become non-refundable; (ii) the proceeds of any financing or
refinancing with respect to all or any part of the Project which has been
previously approved in writing by Lender; (iii) the proceeds of any sale or
other capital transaction (excluding leases for occupancy purposes only) of all
or any portion of the Project; (iv) any insurance or condemnation proceeds paid
with respect to the Project to the extent such proceeds are used to restore or
rebuild the Project as may be permitted in accordance with the terms of the
leases and/or the Deed of Trust, as applicable, except for rental loss or
business interruption

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insurance; and (v) any insurance and condemnation proceeds applied in reduction
of the principal of the Note in accordance with the terms of the leases and/or
the Deed of Trust, as applicable; provided, however, nothing set forth herein
shall in any manner imply Lender's consent to a sale, refinancing or other
capital transaction. Lender reserves the right to review the rent rolls and
leases relating to the Project as submitted by Borrower.

        "GUARANTORS" means Behringer Harvard Short-Term Opportunity Fund I LP
and any other Person which subsequently guaranties the payment and performance
of the Obligations.

        "GUARANTY AGREEMENT": See SECTION 3.2.

        "HAZARDOUS MATERIALS" include all materials defined as hazardous
materials or substances under any local, state or federal environmental laws,
rules or regulations, and petroleum, petroleum products, oil and asbestos.

        "HPT MANAGEMENT AGREEMENT" means that certain Amended and Restated
Property Management and Leasing Agreement dated as of June 2, 2003, between
Behringer Harvard Short-Term Opportunity Fund I LP and HPT Management Services,
LP, as assigned by Behringer Harvard Short-Term Opportunity Fund I LP to
Borrower with respect to, but only with respect to, the Project.

        "HYPOTHETICAL DEBT SERVICE" means equal monthly payments of principal
and interest based upon the outstanding principal balance of the Note on the
date of calculation amortized over a twenty-five (25) year period from July 1,
2006, at an interest rate equal to the higher of (i) seven percent (7%) per
annum, or (ii) the interest rate per year equal to the U.S. Treasury Securities
10 Year Rate in effect on the date of calculation of Hypothetical Debt Service
plus two percent (2%), or (iii) the Contract Rate in effect upon the date of
calculation of Hypothetical Debt Service.

        "INTEREST EXPENSE" means, for any period, the interest due and payable
by Borrower on the Note during such period, determined in accordance with GAAP.

        "LOAN": See SECTION 2.1.

        "LOAN AMOUNT" means $7,000,000.

        "LOAN DOCUMENTS" means this Agreement, the Note, the Deed of Trust, the
Deposit Account Security Agreement, the Assignment of Management Agreement, the
Service Contract Assignment Agreement, any applicable UCC-1 financing
statements, the Partner's Certificate, the LLC Officer's Certificate, the
Officer's Certificate, the Loans to One Borrower Certificate, the SNDAs, the
Tenant Estoppel Certificates, the Rent Roll Certificate, the Notice of Final
Agreement, and all other documents, instruments, guarantees, security
agreements, deeds of trust, pledge agreements, certificates and agreements
executed and/or delivered by Borrower, or any guarantor or third party other
than Lender in connection with the Loan, together with all renewals, extensions,
modifications and amendments from time to time made of any such documents.

        "LOAN PARTY" means Borrower, the General Partner, each Guarantor and
each other Person who is, or whose property is, directly or indirectly liable
for the Obligations, but excluding any Person that is a limited partner or
investor if such Person is not a Guarantor.

        "LOANS TO ONE BORROWER CERTIFICATE": See SECTION 4.17.

        "MANAGEMENT AGREEMENTS" means, collectively, the HPT Management
Agreement and the Crescent Management Agreement.

        "MAXIMUM RATE" means the higher of the maximum interest rate allowed by
applicable United States or Texas law as amended from time to time and in effect
on the date for which a determination of interest accrued hereunder is made. The
determination of the maximum rate permitted by applicable Texas law shall be
made pursuant to the weekly ceiling as determined pursuant to Chapter 303 of the
Texas Finance Code, but Lender reserves the right to implement from time to time
any other rate ceiling permitted by such law.

        "NET OPERATING INCOME" means, for any period, Gross Income less
Operating Expenses paid by Borrower during such period.

        "NET RENTABLE SPACE" means (a) in the case of a single tenancy floor,
all floor areas measured from the inside surface of the outer glass or exterior
wall of the Project to the inside surface of the opposite exterior wall,
excluding only the areas within the outside walls used for elevator mechanical
rooms, building stairs, fire towers, elevator shafts, flues, vents, stacks,
vertical pipe shafts and vertical ducts, but including any such areas which are
for the specific use of the particular tenant such as special stairs or
elevators, plus any common areas located on such floor, plus an allocation of
the square footage of the Project's elevator and main mechanical rooms, ground,
lobbies, and basement service areas, and (b) in the case of tenancy of a partial
floor, all floor areas within the inside surface of the outer glass or

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exterior wall enclosing the portion of the leased premises on such floor and
measured to the midpoint of the walls separating areas leased by or held for
lease to other tenants or from areas devoted to corridors, elevator foyers,
restrooms, mechanical rooms, janitor closets, vending areas and other similar
facilities for the use of all tenants on a particular floor (herein, "common
areas"), but including a proportionate part of the common areas located on such
floor based upon the ratio of the tenant's Net Rentable Space on such floor
bears to the aggregate Net Rentable Space on such floor plus an allocation of
the square footage of the Project's elevator and main mechanical rooms, ground,
lobbies, and basement services areas. No deductions from Net Rentable Space are
made for columns or projections necessary for the Project.

        "NOTE" means that certain promissory note made by Borrower payable to
the order of Lender in the original principal sum of $7,000,000 dated as of July
1, 2004, and all renewals, extensions, modifications and amendments thereto, and
substitutions therefor.

         "NOTICE OF FINAL AGREEMENT": See SECTION 4.25.

        "OBLIGATIONS" means the obligations of Borrower:

                (a) to pay all indebtedness arising out of this Agreement, any
        future advances under this Agreement, and all renewals, extensions or
        amendments of such indebtedness or any part thereof or any such future
        advances;

                (b) to pay the principal of and interest on the Note in
        accordance with the terms thereof, and all renewals, extensions,
        modifications and amendments of the Note or any part thereof, and any
        future advances made pursuant thereto;

                (c) to repay to Lender all amounts advanced by Lender hereunder
        or under the other Loan Documents on behalf of Borrower, including,
        without limitation, advances for principal or interest payments to prior
        secured parties, mortgagees, or lienors, or for taxes, levies,
        insurance, rent, repairs to or maintenance or storage of any of the
        collateral;

                (d) to pay any and all other indebtedness of Borrower to Lender
        of every kind, nature and description, direct or indirect, primary or
        secondary, secured or unsecured (including overdrafts), joint or
        several, absolute or contingent, due or to become due, now existing or
        hereafter arising, regardless of how it may be evidenced, including
        without limitation all future advances, whether or not presently
        contemplated by the parties hereto;

                (e) to pay any and all indebtedness of Borrower to Lender (or an
        affiliate of Lender) arising out of any SWAP Agreement which Borrower
        may have with Lender, or, as the case may be, with any affiliate of
        Lender;

                (f) to the extent permitted by law, to pay a delinquency charge
        in an amount not to exceed five percent (5%) of any payment that is more
        than ten (10) days late;

                (g) to perform fully all of the terms and provisions of each of
        the instruments constituting the Loan Documents; and

                (h) to reimburse Lender, on demand, for all of Lender's expenses
        and costs, which each Loan Party is obligated to pay pursuant to the
        terms of the Loan Documents, including without limitation the reasonable
        fees and expenses of Lender's counsel and Construction Consultant.

        "OPERATING EXPENSES" means all reasonable expenses in an amount equal to
those amounts actually incurred and paid by Borrower with respect to the
ownership, operation, management, leasing and occupancy of the Project,
determined on a cash basis, except as otherwise specified herein, including, but
not limited to, any and all of the following (but without duplication of any
item):

                (i) ad valorem taxes calculated on an accrual basis (and not on
        the cash basis) of accounting for the Calendar Period; such accrual
        accounting for ad valorem taxes shall be based upon taxes actually
        assessed for the current calendar year, or if such assessment for the
        current calendar year has not been made, then until such assessment has
        been made (and with any retroactive adjustments for prior calendar
        months as may ultimately be needed when the actual assessments has been
        made) ad valorem taxes for the Calendar Period shall be estimated to be
        an amount equal to one hundred percent (100%) of the assessment for the
        immediately preceding Calendar Period;

                (ii) foreign, U.S., state and local sales, use or other taxes
        except for taxes measured by net income;

                (iii) special assessments or similar charges levied or assessed
        against the Project for public improvements;

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                (iv) costs of utilities, air conditioning and heating for the
        Project to the extent not paid by lessees or tenants;

                (v) maintenance and repair costs for the Project (except for
        ongoing capital repairs, "capital" repairs to be determined in
        accordance with GAAP);

                (vi) management fees (provided, however, the amount of such
        management fees which may be charged hereunder shall not exceed the sum
        of five percent (5%) of the Gross Income for each applicable calendar
        month and, further, such management fee shall not be calculated on units
        occupied on a rent-free basis by on-site employees of Borrower, the
        Project manager or any affiliate of Borrower);

                (vii) all salaries, wages and other benefits to "on-site"
        employees of the Borrower or the Project manager, directly attributable
        to the Project, (excluding all salaries, wages and other benefits of
        officers and supervisory personnel, and other general overhead expenses
        of Borrower and the Project manager) employed in connection with the
        leasing, maintenance and management of the Project;

                (viii) insurance premiums calculated on an accrual basis (and
        not on the cash basis) of accounting for the Calendar Period; such
        accrual accounting for insurance premiums shall be based upon the
        insurance premiums for the Project which were last billed to the
        Borrower;

                (ix) outside accounting and audit fees and costs and
        administrative expenses in each case reasonably incurred by Borrower in
        connection with the direct operation and management of the Project; and

                (x) any payments, and any related interest thereon, to lessees
        or tenants of the Project with respect to security deposits or other
        deposits required to be paid to tenants but only to the extent any such
        security deposits and related interest thereon have been previously
        included in Gross Income.

        Notwithstanding anything to the contrary as being included in the
definition of Operating Expenses, there shall be excluded from Operating
Expenses the following: (i) depreciation and any other non-cash deduction
allowed to Borrower for income tax purposes; (ii) any compensation or fees paid
to managing agents, leasing agents, brokers or other third parties or affiliate
of Borrower which are in excess of the maximum amounts specified above for such
services (e.g. the 5% limit on management fees) or reasonable and necessary
compensation or fees which would be payable to unrelated third parties in arms'
length transactions for similar services in the area in which the Project is
located; (iii) all salaries, wages and other benefits to "off-site" employees
and all other general "off-site" overhead expenses of Borrower, the Project
manager or other professional the Project manager of the Project; (iv) any and
all payments of ad valorem taxes for either real or personal property (except
for the accrual amount allowed pursuant to subparagraph (i) of this definition);
(v) any and all payments of insurance premiums (except for the accrual amount
allowed pursuant to subparagraph (viii) of this definition); (vi) ongoing
capital repairs, including tenant finish costs; (vii) leasing commissions;
(viii) any and all principal, interest or other costs paid under or with respect
to the Obligations with respect to the Project, whether unsecured or secured by
all or any portion of the Project; (ix) legal, accounting or other fees to third
parties incurred in leasing, lease enforcement, capital transactions, and
financing or refinancing; and (x) expenses to the extent Borrower is reimbursed
therefor, or same are paid directly by any insurance company, warrantor or other
third party and such amounts are not included in Gross income.

        "OPERATING REPORT": See SECTION 8.1C.

        "ORIGINAL MATURITY DATE" means July 1, 2007.

        "PARTNERSHIP AGREEMENT" means that certain Agreement of Limited
Partnership of Behringer Harvard Quorum I LP dated as of June 23, 2004, among
Behringer Harvard Quorum I GP, LLC, a Texas limited liability company as general
partner, and Behringer Harvard Short-Term Opportunity Fund I LP as limited
partner.

        "PERMITTED INVESTMENTS" mean (i) cash, (ii) evidences of indebtedness
maturing not more than one year after the date of issue, issued or guaranteed by
the Government of the United States of America, or agencies thereof, (iii) bonds
issued by a corporation with a rating of P-1 according to Moody's Investors
Services, Inc., A-1 according to Standard and Poor's Corporation, or F-1
according to Fitch Investors Service, Inc., which are unrestricted and freely
traded on a national securities exchange, (iv) securities freely traded on the
New York Stock Exchange, AMEX, or the NASDAQ Market System issued by companies
having a market capitalization greater than $500,000,000, (v) certificates of
deposit issued by Lender, (vi) readily marketable commercial paper rated "A-1"
by Standard & Poor's Corporation (or similar rating by any similar organization
which rates commercial paper), (vii) readily marketable direct obligations of
any state of the United States of America or any political subdivision of any
such state given on the date of such investment a credit rating of at least AA
by Standard & Poor's Corporation due within one year from the acquisition
thereof, (viii) repurchase agreements with respect to

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the investments referred to in the preceding clauses with any bank or trust
company organized under the laws of the United States of America or any state
thereof and having combined capital, surplus and undivided profits of not less
than $500,000,000 (as of the date of its most recent financial statements) and
having deposits that have received one of the two highest ratings obtainable
from Standard & Poor's Corporation, (ix) Eurodollar time accounts or Eurodollar
certificates of deposit each with banker's acceptances of any bank or trust
company organized under the laws of the United States of America or any state
thereof having combined capital, surplus and undivided profits of not less than
$500,000,000 (as of the date of its most recent financial statements) and having
deposits that have received one of the two highest ratings obtainable from
Standard & Poor's Corporation, and (x) such other investments as may be approved
by Lender.

        "PERMITTED LIENS" means (i) the liens and security interests evidenced
by the Loan Documents, (ii) statutory liens for taxes which are not yet
delinquent, (iii) mechanics' and materialman's liens, with respect to
obligations which are not past due, (iv) other liens and security interests, in
favor of Lender, (v) liens previously disclosed to Lender in writing, (vi)
exceptions to coverage reflected in the Title Policy, (vii) purchase money
security interest upon or in assets acquire or held by Borrower in the ordinary
course of business to secure the purchase price of such property or secure
indebtedness incurred solely for the purpose of financing the acquisition of
such property, (viii) liens expressly permitted by the terms of the Loan
Documents, and (ix) minor defects and irregularities of title which neither (1)
are liens or security which secure other indebtedness or obligations, nor (2)
materially impair the value of such asset or the use thereof for the purposes
for which such asset is held.

        "PERSON" means a corporation, an association, a joint venture, an
organization, a business, an individual or a government or political subdivision
thereof or any governmental agency.

        "PLAN" means, at any time, any employee benefit plan which is covered by
ERISA and in respect of which Borrower or any Commonly Controlled Entity is (or,
if such plan were terminated at such time, would under ERISA be deemed to be) an
"employer" as defined in ERISA.

        "POTENTIAL DEFAULT" means any condition, event or act, which with the
giving of notice or the lapse of time, or both, will constitute an Event of
Default hereunder.

        "PRINCIPAL DEBT": See SECTION 2.3.

        "PROJECT" means (i) the 133,799 square foot seven-story office building,
parking garage and nine-lane drive-thru bank facility located at 5050 Quorum
Drive in Addison, Dallas County, Texas, and situated on approximately 3.89 acres
of land more particularly described in the Deed of Trust, and (ii) all
structures, fixtures and improvements now or hereafter constructed thereon, and
(iii) all personal property, rents, fixtures and equipment now owned or
hereafter acquired by Borrower, which are now or hereafter used in connection
with the operation and enjoyment thereof, or which are now or hereafter affixed
to such office/motor bank complex.

        "RENT ROLL CERTIFICATE": See SECTION 4.15.

        "SECOND EXTENDED MATURITY DATE" means July 1, 2009.

        "SERVICE CONTRACT ASSIGNMENT AGREEMENT": See SECTION 3.4.

        "SERVICE CONTRACTS" mean all existing contracts between Borrower or
prior owners of the Project or the Project's management company with various
vendors, suppliers and service providers for the Project.

        "SNDA": See SECTION 4.13.

        "SWAP AGREEMENT" means any interest rate or currency swap, commodity
swap, equity swap, rate cap, rate floor, rate collar, forward agreement, or
other exchange or rate protection arrangement, or any similar transaction or any
option with respect to any such transaction.

        "TENANT ESTOPPEL CERTIFICATE": See SECTION 4.14.

        "TENANT IMPROVEMENT EXPENSES" means (a) hard and soft expenses incurred
in the construction and finish out of Net Rentable Space and improvements
therein for tenants at the Project, and (b) the following expenses directly
incurred in connection with obtaining tenants for the Project: space planning,
moving allowance, lease buy-out expense and legal expenses related to lease
negotiations.

        "TITLE INSURER" means Chicago Title Insurance Company.

        "TITLE POLICY": See SECTION 4.6.

        "WSJ PRIME RATE" means a fluctuating rate of interest equal to the
highest quoted annual rate of interest which is published from time to time in
the "Money Rates" section of THE WALL STREET JOURNAL as the prime rate (or, if
such source is not available, such alternate source as determined by Lender), as

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adjusted from time to time in Lender's soul discretion for reserve requirements,
deposit insurance assessment rates and other regulatory costs. Any change in the
rate will take effect on the effective date as indicated in THE WALL STREET
JOURNAL. Interest will accrue on any non-banking day at the rate in effect on
the immediately preceding banking day.

        1.2 TERMS GENERALLY. All other terms contained in this Agreement, unless
the context indicates otherwise, have the same meanings as provided for by the
Uniform Commercial Code as adopted in Texas to the extent the same are used or
defined therein. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. The words "include",
"includes" and "including" shall be deemed to be followed by the phrase "without
limitation." The word "will" shall be construed to have the same meaning and
effect as the word "shall." Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document herein
shall be construed as referring to such agreement, instrument or other document
as from time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
and (b) the words "herein", "hereof" and "hereunder" and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof.

        1.3 ACCOUNTING TERMS. Unless specified elsewhere herein, all accounting
terms used herein shall be interpreted, all accounting determinations hereunder
shall be made, and all financial statements to be delivered hereunder shall be
prepared in accordance with GAAP.

                              SECTION 2. THE LOAN

        2.1 THE LOAN. Lender agrees, subject to the terms and conditions hereof,
to lend Borrower up to the Loan Amount (the "LOAN"). Lender agrees to make the
Loan to Borrower in advances up to the Loan Amount, subject to and in accordance
with SECTION 5 hereof and the other terms and conditions of this Agreement.
Lender's commitment to lend up to the Loan Amount shall expire and terminate (a)
automatically at 3:00 p.m. Dallas, Texas time on June 30, 2007 (or automatically
at 3:00 p.m. Dallas, Texas time on June 30, 2008 if the term of the Note is
extended from the Original Maturity Date to the First Extended Maturity Date, or
automatically at 3:00 p.m. Dallas, Texas time on June 30, 2009 if the term of
the Note is extended from the First Extended Maturity Date to the Second
Extended Maturity Date), (b) automatically, if the Obligations are prepaid in
full, and (c) at Lender's option upon the occurrence of an Event of Default. The
Loan is not a revolving credit facility, and any amount repaid may not be
reborrowed.

        2.2 USE OF PROCEEDS. The initial advance of $4,550,000 of the proceeds
of the Loan shall be used to acquire the Project and to fund closing costs. Of
the remaining $2,450,000 proceeds of the Loan, $2,250,000 may be used solely to
provide funds for Tenant Improvement Expenses and leasing commissions associated
with the Project, and $200,000 may be used solely to provide funds for Tenant
Improvement Expenses, leasing commissions, and a general contingency fund for
capital expenditures.

        2.3 NOTE. The obligation of Borrower to repay the aggregate principal
balance of all advances of the Loan Amount outstanding at any one time (the
"PRINCIPAL DEBT") shall be evidenced by the Note which shall (a) be payable for
the amount of $7,000,000, or the Principal Debt then outstanding at the time
payment in full is made or due, whichever is less, (b) bear interest from the
date of each advance thereunder until paid at the Contract Rate, (c) be payable
as to principal and interest as provided in SECTION 2.4 hereof, and if
applicable, as provided in SECTION 2.5 hereof and SECTION 2.6 hereof, (d) be
entitled to the benefits of this Agreement and the security provided for herein,
and (e) be in such form as is acceptable to Lender. Interest on the Principal
Debt shall be computed on the basis of a 360 day year and shall accrue on the
actual number of days elapsed (except that if at any time such would otherwise
cause the rate of interest to exceed the Maximum Rate then for such period the
daily rate shall be 1/365th (1/366th in a leap year) of the specific rate per
annum). In computing the number of days during which interest accrues, the day
on which funds are initially advanced shall be included regardless of the time
of day such advance is made, and the day on which funds are repaid shall be
included unless repayment is credited prior to the close of business in
accordance with Lender's customary procedures.

        2.4 AMORTIZATION.

            (a) Interest on the unpaid principal balance of the Note shall be
due and payable monthly as it accrues commencing on the 1st day of August, 2004,
and continuing on the 1st day of each month thereafter through and including
July 1, 2006.

            (b) Then, installments of principal and interest (in arrears) based
upon the then applicable Contract Rate shall be paid in eleven (11) monthly
installments beginning on the 1st day of August, 2006 and continuing on the same
day of each and every month thereafter including the 1st day of June, 2007. The
amount of each installment payment shall be the amount which will fully amortize
the then outstanding principal balance of the Note at the then Contract Rate
over the period of time remaining until twenty-five (25) years after July 1,
2006. The payment shall be adjusted on each date on which the

<PAGE>

WSJ Prime Rate changes to give effect to the adjustment to the applicable
Contract Rate and on which there is an additional advance of the remaining Loan
Amount. The installment payments required to be made hereunder shall be
calculated by Lender so as to fully amortize the balance of the Note at the then
Contract Rate over the remaining term of the initial twenty-five (25) year
amortization. Then, the entire unpaid principal balance of the Note, together
with accrued unpaid interest thereon, shall be due and payable in one
installment on the Original Maturity Date.

            (c) If Borrower exercises the option to extend the Original Maturity
Date to the First Extended Maturity Date, then, installments of principal and
interest (in arrears) based upon the then applicable Contract Rate shall be paid
in twelve (12) monthly installments beginning on the Original Maturity Date and
continuing on the same day of each and every month thereafter including the 1st
day of June, 2008. The amount of each installment payment shall be the amount
which will fully amortize the then outstanding principal balance of the Note at
the then Contract Rate over the period of time remaining until twenty-five (25)
years after July 1, 2006. The payment shall be adjusted on each date on which
the WSJ Prime Rate changes to give effect to the adjustment to the applicable
Contract Rate and on which there is an additional advance of the remaining Loan
Amount. The payments required to be made hereunder shall be calculated by Lender
so as to fully amortize the balance of the Note at the then Contract Rate over
the remaining term of the initial twenty-five (25) year amortization. Then the
entire unpaid principal balance of the Note, together with accrued unpaid
interest, shall be due and payable in one installment on the First Extended
Maturity Date.

            (d) If Borrower exercises the option to extend the First Extended
Maturity Date to the Second Extended Maturity Date, then, installments of
principal and interest (in arrears) based upon the then applicable Contract Rate
shall be paid in twelve (12) monthly installments beginning on the First
Extended Maturity Date and continuing on the same day of each and every month
thereafter including the 1st day of June, 2009. The amount of each installment
payment shall be the amount which will fully amortize the then outstanding
principal balance of the Note at the then Contract Rate over the period of time
remaining until twenty-five (25) years after July 1, 2006. The payment shall be
adjusted on each date on which the WSJ Prime Rate changes to give effect to the
adjustment to the applicable Contract Rate and on which there is an additional
advance of the remaining Loan Amount. The payments required to be made hereunder
shall be calculated by Lender so as to fully amortize the balance of the Note at
the then Contract Rate over the remaining term of the initial twenty-five (25)
year amortization. Then the entire unpaid principal balance of the Note together
with accrued unpaid interest shall be due and payable in one installment on the
Second Extended Maturity Date.

            (e) The applicable Contract Rate shall be adjusted on each date that
the WSJ Prime Rate changes. The amount of the initial and adjusted installments
of principal and interest, as aforesaid, shall be calculated by Lender as soon
as possible after each and every adjustment in the Contract Rate, and after each
and every additional advance of the Loan Amount, and shall be sent in writing to
Borrower on or prior to the date that Borrower will be required to make an
installment payment based upon such adjusted amount.

            (f) To the extent permitted by law, a delinquency charge will be
imposed in an amount not to exceed five percent (5%) of any payment under the
Note that is more than ten (10) days late.

        2.5 EXTENSION OF ORIGINAL MATURITY DATE TO FIRST EXTENDED MATURITY DATE.
Borrower shall have the one time right to extend the term of the Note from the
Original Maturity Date to the First Extended Maturity Date, subject to the
satisfaction (as determined by Lender in Lender's discretion) of the following
terms and conditions precedent:

                A. NOTICE. Borrower shall provide Lender with written notice of
        Borrower's election to exercise this extension not more than sixty (60)
        days, but not less than thirty (30) days, prior to the Original Maturity
        Date, and Borrower's failure to timely exercise this option in
        accordance herewith shall be deemed a waiver and relinquishment of the
        one-time right to exercise this extension option.

                B. NO DEFAULT. On the Original Maturity Date, there shall exist
        no Event of Default or Potential Default hereunder.

                C. EXTENSION FEE. On the Original Maturity Date, Borrower shall
        have paid Lender a non-refundable extension fee in the amount of 0.25%
        of the outstanding principal balance of the Note on the Original
        Maturity Date.

                D. GENERAL RESERVE ACCOUNT. There shall be $400,000 in the
        General Reserve Account on the Original Maturity Date.

                E. DEBT SERVICE COVERAGE RATIO. For the three-month Calendar
        Period immediately preceding the Borrower's notice to Lender of
        Borrower's election to exercise this extension, Borrower shall have
        maintained a ratio of (a) Net Operating Income to (b) Hypothetical Debt
        Service, of at least 1.20 to 1.0.

<PAGE>

        Upon the timely and proper exercise of the option granted in this
SECTION 2.5 and the timely satisfaction, as determined by Lender in Lender's
discretion, of the conditions set forth in this SECTION 2.5, the Original
Maturity Date shall be automatically extended to the First Extended Maturity
Date for all purposes hereunder and under the Loan Documents. The option granted
in this SECTION 2.5 is exercisable by Borrower only once. Any failure to
exercise this option in a timely and proper manner or any failure to satisfy any
of the conditions set forth in this SECTION 2.5 in accordance herewith shall be
deemed a waiver and relinquishment of the one time right to exercise the
extension option herein granted.

        2.6 EXTENSION OF FIRST EXTENDED MATURITY DATE TO SECOND EXTENDED
MATURITY DATE. If Borrower has extended the term of the Note to the First
Extended Maturity Date, then Borrower shall have the one-time right to extend
the term of the Note from the First Extended Maturity Date to the Second
Extended Maturity Date, subject to the satisfaction (as determined by Lender in
Lender's discretion) of the following terms and conditions precedent:

                A. NOTICE. Borrower shall provide Lender with written notice of
        Borrower's election to exercise this extension not more than sixty (60)
        days, but not less than thirty (30) days, prior to the First Extended
        Maturity Date, and Borrower's failure to timely exercise this option in
        accordance herewith shall be deemed a waiver and relinquishment of the
        one-time right to exercise this extension option.

                B. NO DEFAULT. On the First Extended Maturity Date, there shall
        exist no Event of Default or Potential Default hereunder.

                C. EXTENSION FEE. On the First Extended Maturity Date, Borrower
        shall have paid Lender a non-refundable extension fee in the amount of
        0.25% of the outstanding principal balance of the Note on the First
        Extended Maturity Date.

                D. GENERAL RESERVE ACCOUNT. There shall be $400,000 in the
        General Reserve Account on the First Extended Maturity Date.

                E. DEBT SERVICE COVERAGE RATIO. For the three-month Calendar
        Period immediately preceding the Borrower's notice to Lender of
        Borrower's election to exercise this extension, Borrower shall have
        maintained a ratio of (a) Net Operating Income to (b) Hypothetical Debt
        Service, of at least 1.20 to 1.0.

        Upon the timely and proper exercise of the option granted in this
SECTION 2.6 and the timely satisfaction, as determined by Lender in Lender's
discretion, of the conditions set forth in SECTION 2.6, the First Extended
Maturity Date shall be automatically extended to the Second Extended Maturity
Date for all purposes hereunder and under the Loan Documents. The option granted
in this SECTION 2.6 is exercisable by Borrower only once. Any failure to
exercise this option in a timely and proper manner or any failure to satisfy any
of the conditions set forth in this SECTION 2.6 in accordance herewith shall be
deemed a waiver and relinquishment of the one time right to exercise the
extension option herein granted.

        2.7 DEBT SERVICE COVERAGE RATIO DURING INTEREST-ONLY PERIOD. During the
period that the Note is payable interest only, Borrower shall not permit, as of
any fiscal quarter end for the three-month period ending on such date, the ratio
of (a) Net Operating Income to (b) Interest Expense, to be less than 1.0 to 1.0.
Borrower agrees that failure to maintain this required ratio will constitute an
Event of Default hereunder unless Borrower's failure to maintain such required
ratio is cured within the ninety (90) day period immediately following the end
of the fiscal quarter for which the non-qualifying ratio is calculated, such
cure to be achieved by reducing the outstanding principal balance of the Note by
an amount sufficient to meet the required minimum ratio upon recalculation of
same.

        2.8 DEBT SERVICE COVERAGE RATIO DURING AMORTIZATION PERIOD. During the
period that monthly principal and interest payments are being made on the Note,
Borrower shall not permit, as of any fiscal quarter end for the twelve-month
Calendar Period ending on such date, the ratio of (a) Net Operating Income to
(b) Hypothetical Debt Service to be less than 1.0 to 1.0. Borrower agrees that
failure to maintain this required ratio will constitute an Event of Default
hereunder unless Borrower's failure to maintain such required ratio is cured
within the ninety (90) day period immediately following the end of the fiscal
quarter for which the non-qualifying ratio is calculated, such cure to be
achieved by reducing the outstanding principal balance of the Note by an amount
sufficient to meet the required minimum ratio upon recalculation of same.

        2.9 BUDGET. The parties hereby approve the budget attached hereto as
EXHIBIT A (the "BUDGET"). Lender shall not be required to (a) make any advance
for any cost not set forth in the Budget, (b) make any advance for any line item
in the Budget that, when added to all prior advances for that line item, would
exceed the lesser of (i) the actual cost incurred by Borrower for such line item
or (ii) the sum allocated in the Budget for that line item, or (c) make any
advance for any contingency line item unless Lender consents to such advance in
its sole discretion. Lender may make advances allocated to line items in the
Budget for other purposes or in different proportions as Lender in its sole
discretion deems necessary or advisable. Without prior written approval of
Lender, Borrower shall not reallocate Loan funds from one Budget line item to
another or otherwise amend the Budget.
<PAGE>

                             SECTION 3. COLLATERAL

        3.1 LIEN AGAINST PROJECT. The payment and performance of the Note and
all of the other Obligations hereunder and under the Loan Documents shall be
secured by a first and superior lien against Borrower's interest in the Project.
The lien against the Project shall be created pursuant to a deed of trust (as
amended from time to time, the "DEED OF TRUST"), which shall be satisfactory in
form and substance to Lender. The Deed of Trust shall, among other things,
prohibit junior or subordinate liens against the Project.

        3.2 GUARANTY. The payment and performance of the Note and all of the
other Obligations hereunder and under the Loan Documents shall be
unconditionally guaranteed by the Guarantors, pursuant to one or more guaranty
agreements (each, as amended from time to time, a "GUARANTY AGREEMENT"), which
shall be satisfactory in form and substance to Lender.

        3.3 ASSIGNMENT OF MANAGEMENT AGREEMENTS. The payment and performance of
the Note and all of the other Obligations hereunder and under the Loan Documents
shall be secured by an assignment to Lender of all of Borrower's rights and
interests which are assignable, but none of its liabilities, in, to and under
the Management Agreements as they relate to, but only as they relate to, the
Project, pursuant to the terms of an agreement (as amended from time to time,
the "ASSIGNMENT OF MANAGEMENT AGREEMENTS"), which shall be satisfactory in form
and substance to Lender. The Assignment of Management Agreements shall, among
other things, provide that the payment of all management fees thereunder are
subordinated to the payment of the Obligations, and all parties to the
Management Agreements shall consent to such subordination.

        3.4 ASSIGNMENT OF SERVICE CONTRACTS. The payment and performance of the
Note and all of the other Obligations hereunder and under the Loan Documents
shall be secured by an assignment to Lender of all of Borrower's rights and
interests which are assignable, but none of its liabilities, in, to and under
the Service Contracts pursuant to the terms of an agreement (as amended from
time to time, the "SERVICE CONTRACT ASSIGNMENT AGREEMENT"), which shall be
satisfactory in form and substance to Lender.

        3.5 GENERAL RESERVE ACCOUNT. On or before July 1, 2006, Borrower shall
establish with Lender a general reserve account (the "GENERAL RESERVE ACCOUNT")
with a deposit of at least $500,000. The General Reserve Account shall be a
blocked account over which Borrower shall have no control. The initial deposit
in the General Reserve Account shall be such amount as Borrower may determine
and shall be funded from sources other than the proceeds of the Loan. The
payment and performance of the Note and all of the other Obligations hereunder
and under the Loan Documents shall be secured by the General Reserve Account
pursuant to the terms of an agreement (as amended from time to time, the
"DEPOSIT ACCOUNT SECURITY AGREEMENT"), which shall be satisfactory in form and
substance to Lender. After the occurrence of an Event of Default, Lender may
(but shall not be obligated to) apply all or any portion of funds on deposit in
the General Reserve Account against the unpaid Obligations in such order as
Lender may determine. Funds on deposit in the General Reserve Account shall bear
interest at Lender's money market account rate, provided that such account shall
be subject to the terms, requirements and restrictions imposed upon Lender's
passbook accounts generally.

                   SECTION 4. CONDITIONS PRECEDENT TO CLOSING

        The closing of the transactions contemplated by this Agreement shall
take place on or before July 2, 2004, as the parties shall agree (the "CLOSING
DATE"). The obligations of Lender as set forth herein are subject to the
satisfaction (in the opinion of Lender), unless waived in writing by Lender, of
each of the following conditions. In the event that Borrower fails to satisfy
any of the conditions precedent to the closing specified below and Lender
nevertheless elects to close as an accommodation to Borrower (there being no
obligation or agreement that Lender will do so), such condition(s) shall not be
deemed waived and Borrower shall have thirty (30) days from the Closing Date to
comply with such condition(s) to the satisfaction of Lender. Borrower's failure
to satisfy such condition(s) precedent to the satisfaction of Lender within such
thirty (30) day period shall constitute an Event of Default hereunder.

        4.1 LOAN ORIGINATION FEE. Borrower shall have paid Lender a loan
origination fee of $70,000.

        4.2 EFFECTIVENESS OF LOAN DOCUMENTS. Each of the Loan Documents shall be
in full force and effect.

        4.3 LEGAL OPINION. There shall have been delivered a favorable opinion
of counsel for each Loan Party covering such matters incident to the Loan as
Lender may reasonably request.

        4.4 INSURANCE CERTIFICATE. Lender shall have received evidence that
Borrower has obtained the policies of insurance specified and required by
SECTION 8.4 hereof.

<PAGE>

        4.5 DOCUMENTATION AND PROCEEDINGS. Lender shall have received such
evidence as Lender requires as to the existence, good standing, authority and
capacity of each Loan Party, and its respective constituent partners and owners
including:

                (a) For each partnership: a partner's certificate (each a
        "PARTNER'S CERTIFICATE") having attached thereto (i) a true and complete
        copy of an executed copy of the partnership agreement and all amendments
        thereto; and (ii) for each limited partnership, a copy of the
        certificate of limited partnership accompanied by a certificate that the
        copy is true and complete issued by the Texas Secretary of State, and
        satisfactory evidence of good standing in Texas.

                (b) For each corporation: an officer's certificate (each an
        "OFFICER'S CERTIFICATE") having attached thereto (i) a copy of its
        articles of incorporation and bylaws, and all amendments thereto, a
        certificate of incumbency of all of its officers who will be authorized
        to execute or test any of the Loan Documents, and a copy of resolutions
        approving the Loan Documents and authorizing the transactions
        contemplated by this Agreement; and (ii) certificates of existence and
        good standing issued by the appropriate governmental officials of the
        State of Texas.

                (c) For each limited liability company: an officer's certificate
        (each an "LLC OFFICER'S CERTIFICATE") having attached thereto (i) a true
        and complete copy of the articles of organization and operating
        agreement, and all amendments thereto, a certificate of incumbency of
        all of its members who are authorized to execute or attest to any of the
        Loan Documents, and a true and complete copy of resolutions approving
        the Loan Documents and authorizing the transactions contemplated in this
        Agreement and the other Loan Documents; and (ii) certificates of
        existence, good standing and qualification to do business issued by
        appropriate governmental officials in the state of its formation and, if
        different, the state in which real estate owned by it and pledged to
        Lender is located.

        4.6 TITLE INSURANCE. Borrower shall cause to be delivered to Lender a
commitment for the issuance of a mortgagee policy of title insurance issued by
the Title Insurer in the maximum amount of the Note insuring that the Deed of
Trust covering the Project constitutes a valid lien against same, and having the
priority required by Lender and subject only to those exceptions and
encumbrances (regardless of rank or priority) as Lender approves, in form
acceptable to Lender, with the standard printed exceptions endorsed to Lender's
satisfaction (such mortgagee policy of title insurance being referred to as the
"TITLE POLICY").

        4.7 SURVEY. Lender shall have received two (2) copies of an "as built"
survey of the land upon which the Project is situated acceptable to Lender. The
survey will meet the requirements of the Title Insurer to remove the "survey
exception" from the Title Policy and shall contain a certificate acceptable to
Lender.

        4.8 APPRAISAL. Lender shall have received and approved a market value
appraisal of the Project on an "as is" and an "as stabilized" "fee simple"
basis. The appraiser and the appraisal must be satisfactory to Lender (including
satisfaction of applicable regulatory requirements).

        4.9 ENVIRONMENTAL COMPLIANCE/REPORT. Lender shall have received and
approved evidence satisfactory to Lender that no portion of the land upon which
the Project is situated is "wetlands" under any applicable law and that the land
upon which the Project is situated does not contain and is not within or near
any area designated as a hazardous waste site by any governmental authority,
that neither the Project, nor any adjoining property contains or has ever
contained any substance classified as hazardous or toxic (or otherwise
regulated, such as, without limitation, asbestos, radon and/or petroleum
products) under, and that neither the Project nor any use or activity thereon
violates or is or could be subject to any response, remediation, clean-up or
other obligation under, any law or governmental requirement pertaining to health
or the environment, including without limitation, a written report of an
environmental assessment of the Project, by an engineering firm, and of a scope
and in form and content satisfactory to Lender, showing that there is no
evidence of any such substance which has been generated, treated, stored,
released or disposed of in the Project, and such additional evidence as may be
required by Lender. All reports, drafts of reports, and recommendations, whether
written or oral, from such engineering firm shall be made available and
communicated to Lender.

        4.10 ESA RELIANCE LETTER. Lender shall have received and approved a
letter from the engineering firm preparing the environmental work described in
the immediately preceding section entitling Lender to rely on the same for all
purposes.

        4.11 PROPERTY CONDITION REPORT. Lender shall have received a property
condition report for the Project which shall be satisfactory in form and
substance to Lender.

        4.12 SUBORDINATION, ATTORNMENT AND NON-DISTURBANCE AGREEMENTS. Lender
shall have received subordination, attornment and non-disturbance agreements
(each a "SNDA") in form and substance satisfactory to Lender executed by all of
the tenants at the Project.

<PAGE>

        4.13 TENANT ESTOPPEL CERTIFICATES. Lender shall have received tenant
estoppel certificates (each a "TENANT ESTOPPEL CERTIFICATE") in form and
substance acceptable to Lender executed by all of the tenants at the Project.

        4.14 RENT ROLL CERTIFICATE. Lender shall have received a certificate
(the "RENT ROLL CERTIFICATE") having attached thereto and certified by Borrower
to be true, complete and correct, a rent roll for the month of May, 2004,
reflecting all tenants at the Project and all other persons or entities
occupying the Project, and copies of all tenant leases affecting all or any
portion of the Project. The Rent Roll Certificate and all of the exhibits shall
be in form and content acceptable to Lender.

        4.15 STANDARD FORM OF LEASE. Lender shall have received the standard
form of lease which Borrower plans to utilize in leasing space at the Project,
and such lease form shall be in form and content acceptable to Lender.

        4.16 LOANS TO ONE BORROWER CERTIFICATE. Borrower shall have executed and
delivered to Lender a certificate (the "LOANS TO ONE BORROWER CERTIFICATE") with
respect to the compliance of the transactions contemplated by this Agreement
with applicable federal law concerning lending limits to borrowers generally.

        4.17 OPERATING REPORT AND PROJECTIONS. Borrower shall have delivered to
Lender (a) an actual operating report prepared on a month-by-month basis for the
months of January, February, March, April and May, 2004, and (b) operating
projections prepared on a month-by-month basis for the months of June through
December, 2004, which operating report projections shall be in form and
substance acceptable to Lender.

        4.18 SERVICE CONTRACTS AND MANAGEMENT AGREEMENT. Lender shall have
received copies of all Service Contracts and the Management Agreement, and all
such contracts shall be satisfactory to Lender in all respects.

        4.19 CERTIFICATES OF OCCUPANCY. Lender shall have been provided with
true and correct copies of all required certificates of occupancy and licenses
and other necessary permits with respect to operation of the Project.

        4.20 ZONING. Lender shall have been provided with evidence satisfactory
to it that the Project is zoned to permit the present uses without the necessity
for variance or exception and that the Project complies with all zoning
ordinances, subdivision and plating requirements, deed restrictions, licensing
requirements, building codes, flood disaster and environmental protection laws
and other legal requirements affecting the use and occupancy of the Project.

        4.21 UTILITY BILLS/DEPOSITS. Lender shall have received evidence
satisfactory to it of the payment of all utility bills and required deposits for
the operation of the Project including without limitation gas, electricity,
storm and sanitary sewer, potable water and telephone services.

        4.22 INVENTORY OF PERSONALTY. Lender shall have received a true,
accurate and complete inventory of all personal property owned by Borrower
located at the Project.

        4.23 COMPLIANCE WITH CONDITIONS PRECEDENT TO CLOSING. All conditions
precedent to the closing of Borrower's acquisition of the Project pursuant to
the Contract of Sale except for Borrower's payment of the purchase price, shall
have been complied with, or waived by the applicable party, to Lender's
satisfaction.

        4.24 NOTICE OF FINAL AGREEMENT. Each Loan Party shall have executed a
notice in compliance with the provisions of Section 26.02 of the Texas Business
and Commerce Code (the "NOTICE OF FINAL AGREEMENT").

        4.25 REPRESENTATIONS AND WARRANTIES All representations and warranties
contained
herein or in the documents referred to herein or otherwise made in writing in
connection herewith or therewith shall be true and correct with the same force
and effect as though such representations and warranties have been made on and
as of this date.

        4.26 EXPENSES. Borrower shall have paid all reasonable expenses of
Lender in connection with the preparation of the Loan Documents and the making
of the Loan, including but not limited to, the fees and expenses of counsel for
Lender.

                       SECTION 5. ADVANCES OF LOAN AMOUNT

        5.1 INITIAL ADVANCE. The initial advance of the Loan Amount shall be in
the amount of $4,550,000 to fund closing costs and a portion of the purchase
price for the acquisition of the Project pursuant to the Contract of Sale.

<PAGE>

        5.2 PROCEDURE FOR SUBSEQUENT ADVANCES. Of the remaining Loan Amount,
$2,250,000 may be used solely for Tenant Improvement Expenses and for the
payment of leasing commissions and $200,000 may be used solely for Tenant
Improvement Expenses, for the payment of leasing commissions, and to provide a
general contingency fund for capital expenditures. Advances of the Loan Amount
for these purposes shall be made pursuant to a Draw Request. A "DRAW REQUEST"
means a properly completed and executed written application by Borrower to
Lender in a form attached hereto as EXHIBIT B setting forth the amount of the
Loan proceeds desired, together with schedules of invoices, affidavits,
releases, waivers, statements, and other documents and information reasonably
required by Lender. At least five (5) business days before the requested date of
each advance, Borrower shall deliver a Draw Request to Lender. Borrower shall be
entitled to an advance only in an amount approved by Lender in accordance with
the terms of this Agreement and the Loan Documents. Lender shall not be required
to make advances more frequently than once each calendar month. Lender shall,
only upon the satisfaction of all applicable conditions of this Agreement and
the Loan Documents, make the requested advance to Borrower on a business day
within five (5) business days after such satisfaction. The submission of a Draw
Request to Lender shall constitute a certification by the General Partner, both
in its capacity as a partner and as the act of Borrower, respectively, to Lender
that on the date thereof (a) all representations and warranties contained in the
Loan Documents are true and correct in all material respects, and (b) no Event
of Default and/or Potential Default exists.

        5.3 CONDITIONS TO ALL ADVANCES MADE PURSUANT TO A DRAW REQUEST. As
conditions precedent to each advance made pursuant to a Draw Request in addition
to all other requirements contained in the other Loan Documents, Borrower must
satisfy the following conditions, and deliver to Lender evidence of such
satisfaction:

                (a) No Event of Default or Potential Default exists.

                (b) The representations and warranties made in the Loan
        Documents must be true and correct on and as of the date of each
        advance.

                (c) Either (i) no mechanics or materialmen's lien or other
        encumbrance shall have been filed and remain in effect against the
        Project, and releases or waivers of mechanics' liens and receipted bills
        showing payment of all amounts due (except for any amounts to be paid
        with funds from the pending Draw Request) to all parties who have
        furnished materials or services or performed labor of any kind in
        connection with the Project shall have been obtained, or (ii) Borrower
        shall have deposited with Lender a bond or other security satisfactory
        to Lender in such amount as Lender shall require, but not more than 150%
        of the amount of the claim, and Borrower shall thereafter diligently
        proceed to cause any such lien to be removed and discharged.

                (d) Borrower shall have delivered to Lender such other
        information and documents as may be reasonably required by Lender.

                (e) With respect to any advance to pay a contractor, Lender
        shall have received a Draw Request containing a breakdown by trade
        and/or other categories acceptable to Lender, executed and certified by
        each contractor and Borrower's architect (if any) and verified and
        confirmed by the Construction Consultant (if requested by Lender),
        accompanied by invoices and if requested by Lender, the certification of
        one or more of the foregoing parties that the amount of the advance
        requested represents payment of materials or work in place based upon
        on-site observations and the data comprising the Draw Request, the work
        has progressed as indicated, the work has been done in accordance with
        the applicable construction contract, and the applicable plans and
        specifications. With respect to any advance to pay any person other than
        a contractor, Lender shall have received a copy of the applicable
        invoice. In addition, Lender shall have also received a budget
        disbursement report prepared in the format acceptable to Lender
        containing a cost itemization specifying on a line item basis the
        budgeted amount for the item, the total previously advanced for the item
        and the unfunded balance of the item. The line items on the budget
        disbursement report shall conform to the line items of the Budget.

                (f) With respect to any advance for hard costs in an amount
        equal to or greater than $100,000, the Construction Consultant shall
        have conducted an inspection of the work that is the subject of the
        advance and shall have determined that the amount of the advance
        requested represents payment of materials or work in place based upon
        on-site observations and the data comprising the Draw Request, the work
        has progressed as indicated, the work has been done in accordance with
        the applicable construction contract, and the applicable plans and
        specifications.

                (g) Borrower shall have paid the reasonable expenses of the
        Construction Consultant.

        5.4 ADVANCES FOR TENANT IMPROVEMENT EXPENSES. Advances for payment of
Tenant Improvement Expenses shall be conditioned upon Lender having received in
advance and approved (a) any lease or lease amendment for the premises which is
the subject of the Tenant Improvement Expenses; (b) a cost itemization
associated with the Tenant Improvement Expenses for the work, such cost
itemization to specify on a line item basis the estimated amount or amounts to
be expended in connection

<PAGE>

with the work, and the specific purposes for such expenditures; (c) copies of
the actual construction contracts with respect to such Tenant Improvement
Expenses; (d) copies of invoices to be paid with the proceeds of the requested
advance; and (e) such lien waivers, certificates of occupancy (when available)
and building permits as Lender may require or as may be applicable.

        5.5 CONDITIONS AND WAIVERS. All conditions precedent to the obligation
of Lender to make any advance are imposed hereby solely for the benefit of
Lender, and no other party may require satisfaction of any such condition
precedent or be entitled to assume that Lender will refuse to make any advance
in the absence of strict compliance with such conditions precedent. Any
requirement of this Agreement may be waived, in whole or in part, in a specific
written waiver intended for that purpose and signed by Lender. Lender shall have
the right to approve and verify the periodic progress, costs incurred by
Borrower, and the estimated costs remaining to be incurred. No advance shall
constitute an approval or acceptance by Lender of any construction work, a
waiver of any condition precedent to any further advance, or preclude Lender
from thereafter declaring the failure of Borrower to satisfy such condition
precedent to be an Event of Default. No waiver by Lender of any condition
precedent or obligation shall preclude Lender from requiring such condition or
obligation to be met prior to making any other advance or from thereafter
declaring the failure to satisfy such condition or obligation to be an Event of
Default. Lender may engage a Construction Consultant (a) to assist it in
connection with Lender's review of plans for tenant improvements, and Lender's
determination of Borrower's compliance with the conditions for advances, and (b)
to perform such other duties in connection with the construction and finish out
of Net Rentable Space for a tenant at the Project as Lender may require.
Borrower shall pay the reasonable fees and expenses of the Construction
Consultant.

        5.6 NO ADVANCES DURING DEFAULT OR AFTER POTENTIAL DEFAULT. Borrower
shall not be entitled to receive, and Lender shall have no obligation to fund,
any advance whatsoever (whether previously approved by Lender or not) (a) during
the existence of any Event of Default, or (b) after the occurrence of any
Potential Default, unless such Potential Default is cured to the satisfaction of
the Lender.

                   SECTION 6. LEASES AND CONSTRUCTION MATTERS

        6.1 CERTAIN LEASE RESTRICTIONS. Borrower may enter into any lease or
leases or amendments to existing leases at the Project for up to 5,000 square
feet of Net Rentable Space without the prior written consent of the Lender;
provided that if Lender gives written notice to Borrower, then thereafter
Borrower may enter into any lease or leases or amendments to existing leases at
the Project for up to 5,000 square feet of Net Rentable Space without the prior
written consent of the Lender only if the following conditions are met:

                (a) Borrower does so on a standard form of lease which has
        previously been submitted to and approved by Lender, permitted changes
        in such approved lease form being only those which have no material
        effect as determined by Lender.

                (b) The form of lease contains provisions acceptable to Lender
        with respect to subordination, non-disturbance, attornment and the
        providing of an estoppel certificate.

                (c) In the case of an amendment to an existing lease, such
        amendment does not directly or indirectly materially reduce the total
        consideration otherwise payable thereunder or the term thereof.

                (d) In the case of a new lease, the gross rental the tenant is
        obligated to pay is not less than then current market rental.

        Except as otherwise expressly provided above, Borrower will not enter
into any lease or leases for all or any portion of the Project without the prior
written approval of Lender (which shall not be unreasonably withheld), which
approval shall include approval of the financial and credit background of the
prospective tenant. Lender will use its best efforts to respond to Borrower's
request for approval of a lease within ten (10) business days of receipt of such
request and of (a) a copy of the proposed lease agreement (which shall be on a
standard form of lease which has previously been submitted to and approved by
Lender), (b) information regarding the financial and credit background of the
prospective tenant, and (c) if an advance is requested of the Loan, then all of
the documents required for an advance as provided by this Agreement. Lender's
failure to respond within such ten (10) business day period shall be deemed to
be Lender's approval of the proposed lease agreement. Borrower acknowledges that
leases entered into pursuant to this Section will generally reflect market
conditions and consequently may or may not generate receipts sufficient to meet
Borrower's obligations under the Loan Documents. Under no circumstances shall
Borrower's obligations under the Loan Documents be deemed to be waived,
diminished, reduced or otherwise impaired by virtue of the fact that leases
approved pursuant to this Section do not generate sufficient receipts to enable
Borrower to comply with such obligations.

<PAGE>

        6.2 CONTRACTS. All material contracts (as defined below) for the
performance of any work or the supplying of any labor, materials or services for
the design or construction of improvements to the Project shall provide that all
liens of the applicable contractor, architect, supplier, surveyor or other party
and any right to remove removable improvements are subordinate to Lender's
rights, shall require all subcontracts and purchase orders to contain a
provision subordinating the subcontractors' and mechanics' and materialmen's
liens and any right to remove removable improvements to Lender's rights, and
shall provide that no change order over $1,000 shall be effective without the
prior written consent of Lender. Borrower shall not default under any such
contract to which it is a party, Borrower shall not permit any contract to
terminate by reason of any failure of Borrower to perform thereunder, and
Borrower shall promptly notify Lender of any material default thereunder.
Borrower will deliver to Lender, upon request of Lender, the names of all
Persons with whom each contractor has contracted or intends to contract for the
construction of the Improvements or for the furnishing of labor or materials
therefor. With respect to contracts for the performance of any work or the
supplying of any labor, material or services, a "material" contract is one which
exceeds $10,000 in total price.

        6.3 CONSTRUCTION OF THE IMPROVEMENTS. Borrower shall prosecute the
construction of any improvements to the Project with diligence and continuity,
in a good and workmanlike manner, and in accordance with sound building and
engineering practices, all applicable laws and governmental requirements, the
Loan Documents, and the plans and specifications. With respect to any particular
tenant improvement in the Project, or with respect to any other improvement to
the Project, Borrower shall not permit cessation of work for a period in excess
of fifteen (15) days (whether or not consecutive), except for Excusable Delays.
Borrower shall complete construction of any improvements to the Project, and
shall obtain any required certificate of occupancy or certificate of completion
and all other permits, licenses, and approvals for the occupancy, use and
operation of the Improvements from all applicable governmental authorities in a
timely manner, free and clear of all liens except those created pursuant to the
Loan Documents. In the event that space within the Project is unleased, Borrower
may obtain a temporary certificate of occupancy in lieu of a permanent
certificate of occupancy for such unleased space. Borrower shall correct
promptly (a) any material defect in the improvements to the Project, (b) any
material departure from the plans and specifications, law, or governmental
requirements, or (c) any encroachment by any Improvements or structure on any
building setback line, easement, property line or restricted area.

        6.4 CHANGES. Without Lender's prior written consent, Borrower shall not
change or modify the plans and specifications for the improvements to the
Project in any material way, agree to any material change order, or allow any
material extras to any contractor or any subcontractor.

        6.5 INSPECTION. Lender and its agents including the Construction
Consultant may enter and inspect the Project and any materials at any reasonable
time, any such inspections to be coordinated with the contractor performing the
work. Borrower will furnish to Lender at any time for inspection and copying all
plans and specifications, shop drawings, specifications, books and records, and
other documents and information required by Lender.

        6.6 STORAGE OF MATERIALS. Borrower shall cause all materials supplied
for, or intended to be utilized in, the construction of any improvements to the
Project, but not yet affixed to or incorporated into the improvements to be
stored on the land upon which the Project is situated with adequate safeguards,
as required by Lender, to prevent loss, theft, damage or commingling with other
materials. Borrower shall not purchase or order materials for delivery to the
Project more than forty-five (45) days prior to the scheduled incorporation of
such materials into the improvements to the Project.

        6.7 CONSTRUCTION CONSULTANT. The duties of the Construction Consultant
may include, among other things, reviewing the plans and specifications and any
proposed changes to the plans and specifications, performing construction costs
analyses, observing work in place and reviewing Draw Requests. Borrower will
cooperate with the Construction Consultant and will furnish the Construction
Consultant whatever the Construction Consultant considers necessary or useful to
perform its duties. The duties of the Construction Consultant run solely to
Lender, and the Construction Consultant shall have no obligations or any
responsibilities whatsoever to Borrower or its architect or the general
contractor or to any of their agents or employees. Unless prohibited by
applicable law, the costs, expenses and reasonable fees of the Construction
Consultant shall be paid by Borrower.

        6.8 REPORTS AND TESTING. Borrower shall (a) promptly deliver to Lender
copies of all reports, studies, inspections and tests made on the land upon
which the Project is situated, the improvements to the Project or any materials
to be incorporated into the improvements to the Project; and (b) if Lender has
reason to believe that conditions may have changed, make such additional tests
on the land upon which the Project is situated, the improvements to the Project
or any materials to be incorporated into the Improvements as Lender reasonably
requires. Borrower shall immediately notify Lender of any report, study,
inspection or test that indicates any adverse condition relating to the land on
which the Project is situated, the improvements to the Project or any such
materials.

<PAGE>

                          SECTION 7. IMPOUND ACCOUNTS

        7.1 TAX IMPOUND ACCOUNT. Promptly following the Closing Date, Borrower
shall create with Lender an impound account for real estate taxes affecting the
Project. Commencing on the 1st day of August, 2004, and continuing on the 1st
day of each month thereafter to the maturity date of the Note, and in addition
to the payments required under the Note on such dates, Borrower shall pay to
Lender an amount for deposit in the tax impound account. The amount of the
monthly tax impound account payment shall be such as Lender shall from time to
time determine based upon prior real estate taxes affecting the Project. The
initial tax impound payment shall be eight-twelfths (8/12) of 100% of the real
estate taxes assessed against the Project for the preceding taxable year.
Thereafter, the amount of the monthly tax impound payment shall be one twelfth
(1/12) of 100% of the real estate taxes assessed against the Project for the
immediately preceding year. On or before October 31 of each year, Borrower will
deliver to Lender a statement or statements showing the amount of such tax
required to be paid and the concern or authority to which same is payable, and
Borrower will, at the same time, deposit with Lender such additional amounts as
will, when added to the amount of the tax impounds previously deposited with
Lender and then remaining available for that purpose, be sufficient to pay such
tax obligations of the Project. Lender shall apply such deposits in payment of
such tax obligations. Borrower shall not be required to pay or cause to be paid
any real estate taxes, charges or assessments affecting the Project if the
payment thereof is being Contested in Good Faith. The tax impound account shall
bear interest at ordinary money market account rates and shall be subject to the
terms, requirements and restrictions imposed on Lender's interest-bearing
accounts generally. Interest so paid shall become part of the tax impound
account.

        7.2 INSURANCE IMPOUND ACCOUNT. If requested by Lender, Borrower shall
create with Lender an impound account for insurance premiums for the insurance
covering the Project. Commencing on the 1st day of the month next following
Lender's request for creation of an insurance impound account, and continuing on
the 1st day of each month thereafter to the maturity date of the Note, and in
addition to payments required under the Note on such dates, Borrower shall pay
Lender an amount for deposit in the insurance impound account. The amount of the
monthly insurance impound account payment shall be such as Lender shall from
time to time determine based upon prior insurance premiums for the insurance
polices covering the Project. The amount of the monthly insurance impound
payment shall be the sum of the Periodic Premium Allocation Amounts for each
insurance policy covering the Project which are in effect on the Closing Date
(or later added or dropped with the consent of Lender). Initially, the Periodic
Premium Allocation Amount for each insurance policy means the quotient obtained
by dividing the annual premium of such policy by the number of months (but no
less than four months) remaining from and including the month in which the
insurance impound account is created through and including the month in which
the expiration date of that particular policy occurs. Once that particular
policy has been renewed for a twelve (12) month term, the Periodic Premium
Allocation Amount for that particular policy shall be one-twelfth (1/12) of 100%
of the insurance premium charged by the insurer. At least fifteen (15) days
prior to the date on which any insurance premium is due, Borrower will deliver
to Lender a statement or statements showing the amount of such insurance premium
to be paid and the concern or authority to which same is payable, and Borrower
will, at the same time, deposit with Lender such additional amounts as will,
when added to the amount of the insurance impounds previously deposited with
Lender and then remaining available for that purpose, be sufficient to pay such
insurance obligations of the Project. Lender shall apply such deposits in
payment of such insurance premiums. The insurance impound account shall bear
interest at ordinary money market account rates and shall be subject to the
terms, requirements and restrictions imposed on Lender's interest-bearing
accounts generally. Interest so paid shall become part of the insurance impound
account.

                        SECTION 8. AFFIRMATIVE COVENANTS

        Until full payment and performance of all Obligations of Borrower under
the Loan Documents, Borrower will, unless Lender consents otherwise in writing
(and without limiting any requirement of any other Loan Document):

        8.1 FINANCIAL STATEMENTS AND OTHER INFORMATION. Deliver or cause to be
delivered to Lender:

                A. ANNUAL FINANCIAL STATEMENTS. Within one hundred twenty (120)
        days of Borrower's fiscal year end, Borrower's annual financial
        statements, to include a balance sheet, an income statement, a cash flow
        statement, and a statement of contingent liabilities, certified and
        dated by an authorized financial officer of the General Partner. These
        financial statements may be Borrower prepared. These statements shall be
        prepared on a consolidating basis.

                B. QUARTERLY FINANCIAL STATEMENTS. If requested by Lender,
        within thirty (30) days after the end of each fiscal quarter of each
        fiscal year (including the last fiscal quarter), Borrower's quarterly
        financial statements, to include a balance sheet, an income and expense
        statement, a cash flow statement, and a statement of contingent
        liabilities. These financial statements shall be certified and dated by
        an authorized financial officer of the General Partner. These financial
        statements shall be prepared on a consolidating basis.

                C. OPERATING REPORTS. Within thirty (30) days after the end of
        each fiscal quarter of each fiscal year (including the last fiscal
        quarter), a statement of the Gross Income received and Operating
        Expenses paid with respect to the Project to be prepared in a format
        acceptable to Lender (the "OPERATING Report"). The Operating Report
        shall include a statement of operation (the components of which shall be
        in sufficient detail to allow Lender to perform an analysis of the
        Project's operation and to enable Lender to calculate independently the
        amount of net operating income being reported) and a Rent Roll and shall
        be certified by the chief financial or other designated officer of the
        General Partner to be complete and correct and conforming in all
        respects to the requirements of this Agreement.

                D. ANNUAL FINANCIAL STATEMENTS OF GUARANTORS. On or before April
        1 of each year commencing April 1, 2005, the financial statements of
        each Guarantor to include a balance sheet, an income statement, a cash
        flow statement and a statement of contingent liabilities. These
        financial statements must be audited (with an unqualified opinion) by a
        certified public accountant acceptable to Lender. These statements shall
        be prepared on a consolidating basis.

                E. COMPLIANCE CERTIFICATE. Within thirty (30) days after the end
        of each fiscal quarter of each fiscal year (including last fiscal
        quarter), a compliance certificate in the form of EXHIBIT D computing
        the debt service coverage ratio for the quarter then ending.

                F. ADDITIONAL INFORMATION. Such additional information, reports
        and statements with respect to the business operations and financial
        condition of Borrower as Lender may reasonably request from time to
        time.

        8.2 ADVERSE CONDITIONS OR EVENTS. Promptly advise Lender in writing of
(i) any condition, event or act which comes to its attention that would or might
materially adversely affect Borrower's financial condition or operations, the
Project or other collateral from time to time securing the Note, or Lender's
rights under the Loan Documents, (ii) any litigation filed against or threatened
Borrower, the Project or any other Loan Party in which the amount in controversy
exceeds $10,000, (iii) the occurrence of any Event of Default, or of any
Potential Default, or the failure of Borrower or any other Loan Party to observe
any of its undertakings hereunder or under any of the other Loan Documents, (iv)
any uninsured or partially uninsured loss through fire, theft, liability or
property damage in excess of an aggregate of $10,000, (v) any other event which
has or can reasonably be expected to have a material adverse effect (including
without limitation, the termination of any material labor contract, any material
labor dispute, or any strike, lockout, walkout, or other dispute to which it is
a party or which affects or may affect any of its property), (vi) any actual,
proposed or threatened testing or other investigation by any governmental
authority or other Person concerning the environmental condition of, or relating
to, the Project or the release of any Hazardous Materials by or from, affecting
or related to the Project (except such releases as are made in accordance with
applicable environmental laws), (vii) any actual or threatened condemnation of
any portion of the Project or any loss of or substantial damage to the Project,
(viii) any labor controversy pending or threatened against any contractor with
respect to the Project, (ix) any notice received by Borrower with respect to the
cancellation, or alteration or non-renewal of any insurance coverage maintained
with respect to the Project, or (x) any required permit, license, certificate or
approval with respect to the Project lapses or ceases to be in full force and
effect.

        8.3 TAXES AND OTHER OBLIGATIONS. Pay all of Borrower's taxes,
assessments and other obligations, including, but not limited to taxes and
assessments and lawful claims which, if unpaid, might by law become a lien
against the assets of Borrower, as the same become due and payable, except to
the extent the same are being Contested in Good Faith, provided that Borrower's
obligations as to real estate taxes affecting the Project are subject to the
provisions of SECTION 7.1 hereof.

        8.4 INSURANCE. Keep, and cause each other Loan Party to keep, and where
applicable cause each contractor to keep, its properties of an insurable nature
insured at all times against such risks and to the extent that like properties
are customarily insured by other companies engaged in the same or similar
businesses similarly situated, maintain insurance of the types and in the
coverage amounts and with reasonable deductibles as are usual and customary,
which shall include the insurance coverage specified on EXHIBIT C attached
hereto. Borrower shall deliver to Lender certificates of insurance coverage at
closing and thereafter as and when requested by Lender.

        8.5 COMPLIANCE WITH LAWS. Comply with all applicable laws (including
environmental laws), rules, regulations and orders of any governmental
authority.

        8.6 COMPLIANCE WITH MATERIAL AGREEMENTS. Comply in all respects with all
existing and future material agreements, indentures, mortgages, or documents
which are binding upon it or affect any of its properties or business.

        8.7 MAINTENANCE OF RECORDS. Keep at all times books and records of
account in accordance with GAAP in which full, true and correct entries will be
made of all dealings or transactions in relation

<PAGE>

to the business and affairs of Borrower, and Borrower will provide adequate
protection against loss or damage to such books of record and account.

        8.8 INSPECTION OF BOOKS AND RECORDS. Allow any representative of Lender
to visit and inspect its properties, to examine its books of record and account
and to discuss its affairs, finances and accounts with any of its officers,
directors, employees and agents, all at such reasonable times, upon reasonable
advance notice, and as often as Lender may request.

        8.9 EXISTENCE AND QUALIFICATION. Preserve and maintain its existence in
Texas and in each other jurisdiction in which qualification is required.

        8.10 ASBESTOS OPERATIONS & MAINTENANCE PROGRAM. Monitor, remove, abate
and/or contain asbestos containing materials in the Project in accordance with,
and otherwise comply with, the Asbestos Operations and Maintenance Program dated
December 1998, prepared by Law Engineering and Environmental Services, Inc.
(Project No. 60300-8-6572-04-606) or such other plan as may be approved by
Lender.

        8.11 FURTHER ASSURANCES. Make, execute or endorse, acknowledge and
deliver or file or cause the same to be done, all such vouchers, invoices,
notices, certifications and additional agreements, undertakings, conveyances,
deeds of trust, mortgages, assignments, financing statements or other
assurances, and take any and all such other action as Lender may from time to
time deem necessary or appropriate in connection with this Agreement or any of
the other Loan Documents (i) to cure any defects in the creation of the Loan
Documents, or (ii) to evidence further or more fully describe, perfect or
realize on the collateral intended as security, or (iii) to correct any
omissions in the Loan Documents, or (iv) to state more fully the security for
the Obligations, or (v) to perfect, protect or preserve any liens pursuant to
any of the Loan Documents, or (vi) for better assuring and confirming unto
Lender all or any part of the security for any of the Obligations.

                         SECTION 9. NEGATIVE COVENANTS

        Until full payment and performance of all Obligations of Borrower under
the Loan Documents, Borrower will not, without the prior written consent of
Lender (and without limiting any requirement of any other Loan Documents):

        9.1 NEGATIVE PLEDGE. Grant, suffer or permit, any contractual or
noncontractual lien on or security interest in its assets, except for Permitted
Liens.

        9.2 MERGER, ETC. Enter into any merger or consolidation or liquidation
or dissolution.

        9.3 EXTENSIONS OF CREDIT. Make any loan or advance to any individual,
partnership, corporation or other entity without consent of Lender, except (a)
loans and intercompany adjustments between Borrower and its subsidiaries
occurring in the ordinary course of business, and (b) advances made to employees
of Borrower for the payment by them of items for which an expense report or
voucher will be filed and which items will constitute ordinary and necessary
business expenses of Borrower.

        9.4 BORROWINGS. Create, incur, assume or become liable in any manner for
any indebtedness (for borrowed money, deferred payment for the purchase of
assets, lease payments, as surety or guarantor for the debt for another, or
otherwise) other than to Lender, except for (a) normal trade debts incurred in
the ordinary course of Borrower's business; (b) existing indebtedness disclosed
to Lender in writing and acknowledged by Lender prior to the date of this
Agreement; and (c) leases of personal property which are not "capital leases"
under GAAP and for which the lessor's remedy for a breach by the lessee
thereunder is limited to recovery of the item leased.

        9.5 SINGLE ASSET ENTITY. Own any material assets other than the Project.

        9.6 TRANSFER OF ASSETS. Convey, assign, transfer, sell, lease or
otherwise dispose of, in one transaction or a series of transactions (or agree
to do any of the foregoing at any future time), all or substantially all or a
substantial part of its properties or assets (whether now owned or hereafter
acquired) or any part of such properties or assets which are essential to the
conduct of its business substantially as now conducted.

        9.7 INVESTMENTS. Invest in (by capital contribution or otherwise), or
acquire or purchase or make any commitment to purchase the obligations or stock
of, any entity, except for Permitted Investments.

        9.8 CHANGE OF CONTROL OF BORROWER. Permit the change of control of
Borrower. "Change of control" means the occurrence of any of the following
events: (a) Behringer Harvard Quorum I GP, LLC shall cease, for any reason, to
be the sole general partner of Borrower, or (b) Persons who are Guarantors

<PAGE>

as of the Closing Date shall cease for any reason, to own, in the aggregate,
fifty percent (50%) or more of the outstanding capital partnership interests in
Borrower.

        9.9 MODIFICATION OF PARTNERSHIP AGREEMENT. Modify, directly or
indirectly, or change, waive any provision of, amend, supplement, substitute,
terminate, cancel or replace its Partnership Agreement; provided, the
Partnership Agreement may be amended if (a) Borrower gives Lender prior written
notice thereof, and (b) the proposed modification or amendment does not in
Lender's judgment adversely affect the interests of Lender under the Loan
Documents or constitute or result in a breach of any of the provisions contained
in any of the Loan Documents, and (c) no Event of Default or Potential Default
has occurred and is continuing.

        9.10 CHANGE IN MANAGEMENT. Permit Robert Behringer to cease being the
President and Chief Executive Officer of the General Partner.

        9.11 CHANGE IN NATURE OF BUSINESS. Conduct any business other than, or
make any material change in the nature of, its business as carried on as of the
date hereof.

        9.12 ARM'S LENGTH TRANSACTIONS. Enter into a transaction with any
affiliate, except a transaction upon terms that are not less favorable to it
than would be obtained in a transaction negotiated at arm's length with an
unrelated third party.

        9.13 SWAP AGREEMENTS. Enter into any SWAP Agreement other than
Acceptable SWAP Agreements, or cause or permit any SWAP Agreement now existing
or hereafter entered into to be amended, modified, terminated or liquidated.

        9.14 SUBSIDIARIES. Form or acquire any subsidiaries.

        9.15 EXCEPTIONS. Take any action which is permitted by any covenant
contained in this Agreement if such action is in breach of any other covenant
contained in this Agreement.

        9.16 PLAN OBLIGATIONS. Assume or otherwise become subject to an
obligation to contribute to or maintain any Plan or acquire any entity which has
at any time had an obligation to contribute to or maintain any Plan.

                   SECTION 10. REPRESENTATIONS AND WARRANTIES

        Borrower hereby represents and warrants to Lender as follows:

        10.1 NO LIENS. Borrower has good and defensible title to all of its
assets, and none of such assets are subject to any security interest, mortgage,
deed of trust, pledge, lien, title retention document or encumbrance of any
character, except for Permitted Liens.

        10.2 FINANCIAL STATEMENTS. The financial statements of each Loan Party
heretofore delivered to Lender have been prepared in accordance with GAAP and
fairly present such Loan Party's financial condition as of the date or dates
thereof, and there have been no material adverse changes in such Loan party's
financial condition or operation since the date or dates thereof.

        10.3 EXISTENCE. Borrower is a limited partnership, duly organized and
validly existing under the laws of Texas and has the power and authority to own
its property and to carry on its business in Texas and in each other
jurisdiction in which Borrower does business. The General Partner is a limited
liability company, duly organized, validly existing and in good standing under
the laws of Texas and has the power and authority to own its property and to
carry on its business in Texas and in each other jurisdiction in which the
General Partner does business.

        10.4 AUTHORITY AND COMPLIANCE. Each Loan Party has full power and
authority to execute, deliver and perform the Loan Documents to which it is a
party and to incur and perform the obligations provided for therein. No consent
or approval of any public authority or other third party is required as a
condition to the validity or performance of any Loan Document, and each Loan
Party is in compliance with all laws and regulatory requirements to which it is
subject.

        10.5 BINDING AGREEMENTS. This Agreement and the other Loan Documents
executed by each Loan Party constitute valid and legally binding obligations of
such Loan Party, enforceable in accordance with their terms.

        10.6 LITIGATION. There is no proceeding involving any Loan Party pending
or, to the knowledge of Borrower, threatened before any court or governmental
authority, agency or arbitration authority, except as disclosed to Lender in
writing and acknowledged by Lender.

<PAGE>

        10.7 NO CONFLICTING AGREEMENTS. There is no charter, bylaw, stock
provision, partnership agreement or other document pertaining to the power or
authority of any Loan Party and no provision of any existing agreement,
mortgage, indenture or contract binding on any Loan Party or affecting any
property of any Loan Party, which would conflict with or in any way prevent the
execution, delivery or carrying out of the terms of this Agreement and the other
Loan Documents.

        10.8 TAXES. All taxes and assessments due and payable by each Loan Party
has been paid or are being Contested in Good Faith. Each Loan Party has filed
all tax returns which it is required to file.

        10.9 NO DEFAULT. No Event of Default or Potential Default has occurred
and is continuing.

        10.10 ADVERSE CIRCUMSTANCES. To the best of Borrower's knowledge,
neither the business nor any property of any Loan Party is presently materially
affected by any fire, explosion, accident, strike, lockout, or other dispute,
embargo, act of God, act of public enemy, or similar event or circumstance nor
has any other materially adverse event or circumstance relating to its business
or affairs occurred.

        10.11 ACCURACY OF INFORMATION. To the best of Borrower's knowledge, all
factual information furnished to Lender by the Loan Parties and their agents in
connection with this Agreement and the other Loan Documents is and will be
accurate and complete on the date as of which such information is delivered to
Lender and is not and will not be incomplete by the omission of any material
fact necessary to make such information not misleading.

        10.12 ERISA. Borrower does not currently contribute to or have any
obligation to contribute to or otherwise have any liability with respect to any
ERISA Plan, and Borrower is not an "employee benefit plan" or a "government
plan" as defined in ERISA, and none of Borrower's assets constitute "plan
assets" under ERISA.

        10.13 ENVIRONMENTAL. The conduct of Borrower's business operations and
the condition of Borrower's property does not and will not violate any federal
laws, rules or ordinances for environmental protection, or regulations of the
Environmental Protection Agency, or any applicable local or state law, rule,
regulation or rule of common law, or any judicial interpretation thereof
relating primarily to the environment or Hazardous Materials.

        10.14 CONTINUATION OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties made under this Agreement shall be deemed to be
made at and as of the date hereof and at and as of the date of any future
advance hereunder and in all instances shall be true and correct in all material
respects.

                              SECTION 11. DEFAULT

        Any of the following shall constitute events of default (each an "EVENT
OF DEFAULT"):

        11.1 NONPAYMENT. (a) Borrower shall default in the due and punctual
payment of any principal or interest of the Note when due and payable, whether
at maturity or otherwise, and such default continues unremedied for ten (10)
days, or (b) any Loan Party shall default in the due and punctual payment of any
of the other Obligations when due and payable and such default continues
unremedied for ten (10) days.

        11.2 REPRESENTATIONS AND WARRANTIES. Any representation, warranty or
statement made by any Loan Party herein or otherwise in writing in connection
herewith or in connection with any of the other Loan Documents and the
agreements referred to herein or therein or in any financial statement,
certificate or statement signed by any officer or employee of any Loan Party and
furnished pursuant to any provision of the Loan Documents shall be breached, or
shall be materially false, incorrect or incomplete when made.

        11.3 DEFAULT IN COVENANTS UNDER AGREEMENT. (a) Borrower shall default in
the due performance or observance by it of any term, covenant or agreement set
forth in SECTION 8.2 or in SECTIONS 9.1 THROUGH 9.16 hereof; or, (b) Borrower
shall default in the due performance or observance of any term, covenant or
agreement contained in this Agreement other than those specified in clause (a)
immediately preceding (and other than those described in SECTIONS 11.1 AND 11.2
hereof), and such default continues unremedied for a period of thirty (30) days
after notice thereof from Lender or Lender is notified of such default or should
have been so notified pursuant to the provisions of SECTION 8.2 hereof,
whichever is earlier.

        11.4 DEFAULT IN OTHER LOAN DOCUMENTS. Any Loan Party shall default in
the due performance of or observance by it of any term, covenant or agreement on
its part to be performed pursuant to the terms of any of the other Loan
Documents and the default shall continue unremedied beyond any grace or cure
period therein provided.

<PAGE>

        11.5 VALIDITY OF LOAN DOCUMENTS. Any of the Loan Documents shall cease
to be a legal, valid and binding agreement enforceable against any party
executing the same in accordance with the respective terms thereof, or shall in
any way be terminated, or become or be declared ineffective or inoperative, or
shall in any way whatsoever cease to give or provide the respective rights,
remedies, powers and privileges intended to be created thereby.

        11.6 BANKRUPTCY. Any Loan Party shall suspend or discontinue its
business operations, or shall generally fail to pay its debts as they mature, or
shall file a petition commencing a voluntary case concerning any Loan Party
under any chapter of the United States Bankruptcy Code; or any involuntary case
shall be commenced against any Loan Party under the United States Bankruptcy
Code and same is not dismissed within sixty (60) days of filing; or any Loan
Party shall become insolvent (howsoever such insolvency may be evidenced).

        11.7 JUDGMENTS AND DECREES. Any Loan Party shall suffer a final judgment
for the payment of money and shall not discharge the same within a period of
thirty (30) days unless, pending further proceedings, execution has not been
commenced, or, if commenced, has been effectively stayed. Any order, judgment or
decree shall be entered in any proceeding against any Loan Party decreeing the
dissolution or split up of such entity and such order shall remain undischarged
or unstayed for a period in excess of thirty (30) days.

        11.8 SWAP DEFAULT. An event occurs under or pursuant to any SWAP
Agreement between Borrower and Lender which gives Lender the right or option to
terminate the SWAP Agreement.

        11.9 CERTAIN EVENTS RELATED TO CONSTRUCTION OF IMPROVEMENTS. The
occurrence of one or more of the following: (a) failure of the construction of
any of the improvements to the Project to comply with any plans and
specifications approved by Lender or any laws or governmental requirements, and
such failure as not cured within thirty (30) days after written notice thereof
to Borrower; (b) Borrower is enjoined or prohibited from performing any material
obligation of a Loan Document; (c) Borrower enters into any lease of part or all
of the Project in violation of any of the Loan Documents; (d) a lien for the
performance of work or the supply of materials is established against the
Project, or any stop notice served on Borrower or its general contractor or
Lender, and said lien or stop notice remains unsatisfied or unbonded for a
period of thirty (30) days after the filing or service.

        11.10 TRANSFER OF PROJECT. Borrower shall sell, lease, convey, assign,
pledge, encumber or transfer all or any portion of that part of the Project
owned by it or any interest therein, voluntarily or involuntarily, whether by
operation of law or otherwise, except (a) sales and transfers of items of
personalty which have become obsolete or worn beyond practical use and which
have been replaced by adequate substitutes, owned by Borrower having a value
equal to or greater than the replaced items when new; and (b) the grant, in the
ordinary course of business, of a leasehold interest in a part of the
improvements to a tenant for occupancy, not containing a right or option to
purchase and not in contravention of any provision of the Deed of Trust or other
Loan Document; and (c) Permitted Liens.

        11.11 CHASE BANK LEASE. Any act or omission by Borrower shall occur
which gives JPMorgan Chase Bank the right, either immediately or after the lapse
of time, to terminate the Chase Bank Lease or to claim a partial or total
eviction (a "LANDLORD DEFAULT"), and such Landlord Default shall continue
unremedied for a period of ten (10) days following Lender's receipt of JPMorgan
Chase Bank's written notice of such Landlord Default.

                              SECTION 12. REMEDIES

        Upon the occurrence of an Event of Default described in SECTION 11.6
hereof, the entire principal of and accrued interest on the Note shall forthwith
be due and payable without demand, presentment for payment, notice of
nonpayment, protest, notice of protest, notice of intent to accelerate, notice
of acceleration and all other notices and further actions of any kind, all of
which are hereby expressly waived by Borrower. In the event that any other Event
of Default shall occur and be continuing, Lender may, without demand or notice
of its election, terminate its obligation to make further Loans hereunder and/or
declare the entire unpaid balance of the Note and all other indebtedness of
Borrower to Lender, or any part thereof, immediately due and payable, whereupon
the principal of and accrued interest on such Note and other indebtedness shall
be forthwith due and payable without demand, presentment for payment, notice of
nonpayment, protest, notice of protest, notice of intent to accelerate, notice
of acceleration and all other notices and further actions of any kind, all of
which are hereby expressly waived by Borrower. Upon the occurrence and during
the continuance of any Event of Default, Lender may (a) exercise any and all
rights under or pursuant to any of the Loan Documents, and (b) exercise any and
all rights afforded to Lender by the laws of the State of Texas or any other
applicable jurisdiction or in equity or otherwise, as Lender may deem
appropriate, and (c) terminate the obligation to make further advances of the
Loan Amount.

<PAGE>

                SECTION 13. COSTS, EXPENSES AND ATTORNEYS' FEES

        13.1 PAYMENT OF EXPENSES. Borrower shall promptly (and in any event,
within 30 days after any invoice or other statement or notice) pay to Lender
immediately upon demand the full amount of all costs and expenses (including
without limitation attorneys' fees, the Construction Consultants' fees,
engineering fees, travel costs and miscellaneous expenses) incurred by Lender in
connection with (a) negotiation, preparation, execution and delivery of this
Agreement and each of the Loan Documents, and (b) any modifications of or
consents or waivers under or amendments to or interpretations of this Agreement,
the Note, or the other Loan Documents, and (c) all transfer, stamp, mortgage,
documentary or other similar taxes, assessments or other charges levied by any
governmental authority or revenue authority in respect of this Agreement or any
of the other Loan Documents, and (d) the filing, recording, refiling and
rerecording of any Loan Documents and any other documents or instruments or
further assurances required to be filed or recorded or refiled or rerecorded by
the terms of any Loan Document, and (e) the cost of monitoring or confirming
compliance with any covenants or conditions contained in this Agreement or any
of the other Loan Documents. Borrower further agrees to pay on demand all costs
and expenses of Lender, if any (including without limitation reasonable
attorneys' fees and expenses and the cost of internal counsel), in connection
with the enforcement (whether through negotiations, arbitration proceedings,
legal proceedings or otherwise) of the Loan Documents.

        13.2 INDEMNITY. Borrower further agrees to indemnify Lender and its
employees and agents, from and hold them harmless against any and all losses,
liabilities, claims, damages or expenses which any of them suffers or incurs as
a result of Lender's entering into this Agreement and the Loan Documents, or the
consummation of the transactions contemplated by this Agreement and the Loan
Documents, or the use or contemplated use of the proceeds of the Loan, or due to
a release or alleged release of Hazardous Materials, including, without
limitation, the fees and disbursements of counsel incurred in connection with
any litigation, arbitration or other proceeding arising out of or by reason of
any of the aforesaid. IT IS THE INTENTION OF THE PARTIES THAT THE FOREGOING
INDEMNITIES SHALL APPLY TO LOSSES, LIABILITIES, CLAIMS, DAMAGES OR EXPENSES
WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF THE NEGLIGENCE OF AN
INDEMNIFIED PARTY. No such indemnified party, however, shall be entitled to be
indemnified for its or his own gross negligence or willful misconduct. In the
case of an investigation, litigation or other proceeding to which the indemnity
in this Section applies, such indemnities shall be effective whether or not such
investigation, litigation or proceeding is brought by Borrower, its partners or
creditors, or by an indemnified party and whether or not the transactions hereby
are consummated. Borrower shall defend any claim for which an indemnified party
is entitled to seek indemnity pursuant to the preceding sentence, and the
indemnified party shall cooperate with the defense. The indemnified party may
have separate counsel, and Borrower will pay the expenses and reasonable fees of
such separate counsel if either counsel for Borrower or counsel for the
indemnified party shall advise the indemnified party that the interests of both
Borrower and the indemnified party with respect to such claim are or with
reasonable certainty will become adverse. The agreements and obligations of
Borrower contained in this Section shall survive payment in full of the
Obligations.

                           SECTION 14. MISCELLANEOUS

        Borrower and Lender further covenant and agree as follows, without
limiting any requirement of any other Loan Document:

        14.1 NOTICES. Any notices or demands required or permitted to be given
under this Agreement by any party to another shall be in writing; may be
effected by personal delivery, or by certified mail, postage prepaid with return
receipt requested, or by nationally recognized overnight courier for next
business day delivery, or by facsimile; and shall be deemed received when (i)
personally delivered, (ii) three (3) days after being sent by United States
Mail, postage prepaid, certified mail, return receipt requested, and properly
addressed, (iii) the next business day after being deposited with a nationally
recognized overnight courier services, charges prepaid, and properly addressed,
for next business day delivery, or (iv) upon receipt when sent by facsimile
properly addressed a confirmation of receipt is received, with contemporaneous
notification by telephone to the recipient that the facsimile has been sent and
with a copy sent the same day by United States Mail, postage prepaid and
property addressed; PROVIDED that notice is given pursuant to statute shall be
given as required by statute and shall be deemed given as provided by statute. A
party may change his address or facsimile number for purposes of giving notices
under this Agreement by giving notice under this Section; PROVIDED that any such
notice of change of address or facsimile number of any party shall not be
effective until actually received. Unless otherwise changed by notice given
pursuant to this Section, the facsimile transmission number for Borrower shall
be 214-655-1610 and the facsimile transmission number for Lender shall be
972-419-3308. Electronic mail and intranet websites may be used only to
distribute routine communications, such as financial statements and other
information, and to distribute Loan Documents for execution by the parties
thereto.

        14.2 CUMULATIVE RIGHTS AND NO WAIVER. Each and every right granted to
Lender under any Loan Document, or allowed it by law or equity shall be
cumulative of each other and may be exercised in

<PAGE>

addition to any and all other rights of Lender, and no delay in exercising any
right shall operate as a waiver thereof, nor shall any single or partial
exercise by Lender of any right preclude any other or future exercise thereof or
the exercise of any other right. Borrower expressly waives any presentment,
demand, protest or other notice of any kind, including but not limited to notice
of intent to accelerate and notice of acceleration except as expressly provided
herein or in the other Loan Documents. No notice to or demand on Borrower in any
case shall, of itself, entitle Borrower to any other or future notice or demand
in similar or other circumstances.

        14.3 CHOICE OF LAW AND VENUE. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS (BUT NOT THE RULES GOVERNING CONFLICTS
OF LAWS) OF THE STATE OF TEXAS AND SHALL BE PERFORMABLE IN DALLAS COUNTY, TEXAS.

        14.4 AMENDMENT. No modification or amendment of any provision of this
Agreement shall be effective unless the same shall be in writing and signed by
Lender and Borrower. No consent or waiver of any provision of this Agreement,
nor consent to any departure by Borrower therefrom, shall be effective unless
the same shall be in writing and signed by an officer of Lender, and then shall
be effective only in the specified instance and for the purpose for which given.
This Agreement is binding upon Borrower, its successors and assigns, and inures
to the benefit of Lender, its successors and assigns; however, no assignment or
other transfer of Borrower's rights or obligations hereunder shall be made or be
effective without Lender's prior written consent, nor shall it relieve Borrower
of any obligations hereunder. There is no third party beneficiary of this
Agreement.

        14.5 DOCUMENTS. All documents, certificates and other items required
under this Agreement to be executed and/or delivered to Lender shall be in form
and content satisfactory to Lender and its counsel.

        14.6 PARTIAL INVALIDITY. The unenforceability or invalidity of any
provision of this Agreement shall not affect the enforceability or validity of
any other provision herein and the invalidity or unenforceability of any
provision of any Loan Document to any Person or circumstance shall not affect
the enforceability or validity of such provision as it may apply to other
Persons or circumstances.

        14.7 SURVIVABILITY. All covenants, agreements, representations and
warranties made herein or in the other Loan Documents shall survive the making
of the initial Loan and shall continue in full force and effect so long as the
Obligations are outstanding.

        14.8 WAIVER FEE. If Lender, at its discretion, agrees to waive or amend
any terms of this Agreement, Borrower will, at Lender's option, pay Lender a fee
for each waiver or amendment in an amount advised by Lender at the time Borrower
requests the waiver or amendment. Nothing in this Section shall imply that
Lender is obligated to agree to any waiver or amendment requested by Borrower.
Lender may impose additional requirements as a condition to any waiver or
amendment.

        14.9 FEE FOR LATE FINANCIAL STATEMENTS. If any of the financial
information required by this Agreement is not provided to Lender within the time
limits provided in this Agreement, Borrower will, at Lender's option, pay Lender
a late fee in an amount set by Lender. The imposition and payment of a late fee
shall not constitute a waiver of Lender's rights with respect to the default.

        14.10 ENVIRONMENTAL. Borrower will comply in all material respects with
all environmental, health, and safety laws and regulations applicable to it.
Borrower shall immediately notify Lender of any remedial action taken by
Borrower under environmental laws with respect to Borrower's business
operations. Borrower will not use or permit any other party to use any Hazardous
Materials at any of Borrower's places of business or at any other property owned
by Borrower except such materials as are incidental to Borrower's normal course
of business, maintenance and repairs and which are handled in compliance with
all applicable environmental laws. Borrower agrees to permit Lender, its agents,
contractors and employees to enter and inspect any of Borrower's places of
business or any other property of Borrower at any reasonable times upon three
(3) days prior notice for the purposes of conducting an environmental
investigation and audit (including taking physical samples) to insure that
Borrower is complying with this covenant and Borrower shall reimburse Lender on
demand for the costs of any such environmental investigation and audit. Borrower
shall provide Lender, its agents, contractors, employees and representatives
with access to and copies of any and all data and documents relating to or
dealing with any Hazardous Materials used, generated, manufactured, stored or
disposed of by Borrower's business operations within five (5) days of the
request therefor.

        14.11 COMMUNICATIONS VIA INTERNET. Borrower and each Loan Party by its
or his execution of the Loan Documents to which it or he is a party, hereby
authorizes Lender and its counsel to communicate and transfer documents and
other information (including without limitation, confidential information)
concerning this transaction or Borrower or any other Loan Party or the business
affairs of Borrower and any other Loan Party via the Internet or other
electronic communication without regard to the lack of security of such
communications.

        14.12 NO PARTNERSHIP, ETC. The relationship between Lender and Borrower
is solely that of lender and borrower. Lender has no fiduciary or other special
relationship with or duty to Borrower and none is created by the Loan Documents.
Nothing contained in the Loan Documents, and no action taken or omitted pursuant
to the Loan Documents, is intended or shall be construed to create any
partnership, joint venture, association, or special relationship between
Borrower and Lender or in any way make Lender a co-principal with Borrower with
reference to the Project or otherwise. In no event shall Lender's rights and
interests under the Loan Documents be construed to give Lender the right to
control, or be deemed to indicate that Lender is in control of, the business,
properties, management or operations of Borrower. Any inspection or audit of the
Project or the books and records of Borrower, or the procuring of documents and
financial or other information, by on behalf of Lender shall be for Lender's
protection only and shall not constitute any assumption of responsibility of
Borrower or of anyone else with regard to the condition, construction,
maintenance or operation of the Project or relieve Borrower of any of its
obligations hereunder. Lender is under no duty to supervise or to inspect the
Project or the construction of the improvements nor under any duty of care to
Borrower or any other Person to protect against, or inform Borrower or any other
Person of the existence of negligent, faulty, inadequate or defective design or
construction of improvements. Lender shall not be liable or responsible for any
defect in the Project or the improvements or for any failure of Borrower or any
other Person to construct, complete, protect or insure the improvements.

        14.13 AGREEMENT CONTROLLING. In the event of a conflict between the
terms and provisions of this Agreement and the terms and provisions of any of
the other Loan Documents, the terms and provisions of this Agreement shall
control. This Agreement and the other Loan Documents replace and supersede in
its entirety that certain commitment letter between the parties dated as of
March 17, 2004.

        14.14 SETOFF. In addition to, and without limitation of, any rights of
Lender under applicable law, if any Event of Default occurs, then any and all
deposits (including all account balances, whether provisional or final and
whether or not collected or available) and any other indebtedness at any time
held or owing by Lender or any affiliate of Lender to or for the credit or
account of Borrower may be offset and applied toward the payment of the
Obligations, whether or not the Obligations, or any part thereof, shall then be
due.

        14.15 JOINT PREPARATION; CONSTRUCTION OF INDEMNITIES AND RELEASES. This
Agreement and the other Loan Documents have been reviewed and negotiated by
sophisticated parties with access to legal counsel and no rule of construction
shall apply hereto or thereto which would require or allow any Loan Documents to
be construed against any party because of its role in drafting such Loan
Document. All indemnification and release provisions of this Agreement shall be
construed broadly (and not narrowly) in favor of the Persons receiving
indemnification or being released.

        14.16 WAIVER OF JURY TRIAL. BORROWER AND LENDER IRREVOCABLY WAIVE ANY
AND ALL RIGHT EITHER OF THEM MAY HAVE TO A TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR CLAIM OF ANY NATURE RELATING TO THIS AGREEMENT, OR ANY DOCUMENTS
EXECUTED IN CONNECTION WITH THIS AGREEMENT, OR ANY TRANSACTIONS CONTEMPLATED IN
ANY SUCH DOCUMENTS. BORROWER AND LENDER ACKNOWLEDGE THAT THE FOREGOING WAIVER IS
KNOWING AND VOLUNTARY. Borrower acknowledges that it has read and understands
all of the provisions of this Agreement, including the waiver of jury trial, and
has been advised by counsel as necessary or appropriate.

                     SECTION 15. NOTICE OF FINAL 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.

<PAGE>

         IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date and year first above written.

                                 BEHRINGER HARVARD QUORUM I LP

                                 By:      Behringer Harvard Quorum I GP, LLC,
                                          Its General Partner

                                          By:   /s/ Gerald J. Reihsen
                                             -----------------------------------
                                                 Gerald J. Reihsen, III
                                                 Secretary

                                 FIRST AMERICAN BANK, SSB

                                 By     /s/ William L. Kinard
                                   ---------------------------------------------
                                          William L. Kinard
                                          Senior Vice President<PAGE>

                                                                   EXHIBIT 10.16

AFTER RECORDING, RETURN TO:

Daniel F. Susie
Strasburger & Price, LLP
901 Main Street, Suite 4300
Dallas, Texas  75202

                     DEED OF TRUST (WITH SECURITY AGREEMENT,
             ASSIGNMENT OF RENTS AND LEASES AND FINANCING STATEMENT)

This Document Serves as a Fixture Filing under Section 9.502 of the Texas
Business and Commerce Code. The goods described in the granting clause which are
personal property are or are to become fixtures related to the real property
described on EXHIBIT A.

Grantor's Organizational Identification Number is 800356928. Grantor is a Texas
limited partnership.

NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR
STRIKE ANY OF THE FOLLOWING INFORMATION FROM THIS INSTRUMENT BEFORE IT IS FILED
FOR RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER'S
LICENSE NUMBER.

        THIS DEED OF TRUST (WITH SECURITY AGREEMENT, ASSIGNMENT OF RENTS AND
LEASES AND FINANCING STATEMENT) (this "DEED OF TRUST") dated as of July 1, 2004,
is executed and delivered by Grantor (as defined herein) for good and valuable
consideration, the receipt, sufficiency and adequacy of which are hereby
acknowledged by Grantor.

                                   ARTICLE 1

                               CERTAIN DEFINITIONS

        In addition to other terms defined herein, each of the following terms
shall have the meaning assigned to it:

        1.1 "BENEFICIARY": FIRST AMERICAN BANK, SSB, a state savings bank, whose
address for purposes of notice is 8401 North Central Expressway, Suite 500,
Dallas, Texas 75225.

        1.2 "GRANTOR": BEHRINGER HARVARD QUORUM I LP, a Texas limited
partnership, whose address for purposes of notice is 1323 N. Stemmons Freeway,
Suite 212, Dallas, Texas 75207.

        1.3 "LOAN AGREEMENT": The Loan Agreement of even date herewith between
Grantor and Beneficiary, which is incorporated herein by reference for all
purposes, and as modified and amended from time to time. Capitalized terms used
in this Deed of Trust and not otherwise defined shall have the meaning given
them in the Loan Agreement.

        1.4 "NOTE": The promissory note of even date herewith made by Grantor
payable to the order of Beneficiary in the principal face amount of $7,000,000
bearing interest as therein provided, containing a provision for the payment of
a reasonable additional amount as attorneys' fees, and all extensions,
modifications, increases and renewals thereof made from time to time, and future
advances made pursuant thereto.

<PAGE>

        1.5 "TRUSTEE": William Kinard of Dallas County, Texas or any successor
or substitute appointed and designated as herein provided from time to time
acting hereunder.

        Any term used or defined in the Texas Business and Commerce Code, as in
effect from time to time, and not defined in this Deed of Trust has the meaning
given to the term in the Texas Business and Commerce Code, as in effect from
time to time, when used in this Deed of Trust.

                                   ARTICLE 2

                                GRANTING CLAUSES

        Grantor does hereby GRANT, BARGAIN, SELL, CONVEY, TRANSFER, ASSIGN and
SET OVER to Trustee, in trust for the benefit of Beneficiary, the following: (a)
the real estate (the "LAND") described in EXHIBIT A attached hereto and
incorporated herein by reference, and (i) all buildings, structures, and other
improvements now or hereafter situated or to be situated on the Land (the
"IMPROVEMENTS"); and (ii) all right, title and interest of Grantor in and to (1)
all streets, roads, alleys, easements, rights-of-way, licenses, rights of
ingress and egress, vehicle parking rights and public places, existing or
proposed, abutting, adjacent, used in connection with or pertaining to the Land
or the Improvements; (2) any strips or gores between or among the Land and
abutting or adjacent properties; and (3) all water and water rights, timber,
crops and mineral interests on or pertaining to the Land (the Land, Improvements
and other rights, titles and interests referred to in this clause (a) sometimes
collectively called the "PREMISES"); (b) all fixtures, equipment, systems,
machinery, furniture, furnishings, appliances, inventory, goods, building and
construction materials, supplies, and articles of personal property, of every
kind and character, now owned or hereafter acquired by Grantor, which are now or
hereafter attached to or situated in, on or about the Land or the Improvements,
or are exclusively used in or useful to the complete and proper planning,
development, use, occupancy or operation thereof, or acquired (whether delivered
to the Land or stored elsewhere) for use or installation in or on the Land or
the Improvements, and all renewals and replacements of, substitutions for and
additions to the foregoing (the properties referred to in this clause (b)
sometimes collectively called the "ACCESSORIES"); (c) all (i) of Grantor's
assignable rights in and to all plans and specifications for the Improvements,
and any and all changes thereto; (ii) Grantor's rights, but not liability for
any breach by Grantor, under all commitments (including any commitment for
financing to pay any of the Indebtedness (as defined below), insurance policies,
architectural, engineering, construction, management, leasing, and other
contracts, including any property management agreement (when signed) and any
post-closing rights under the contract or contracts pursuant to which Grantor
acquired the Land, and general intangibles (including but not limited to
trademarks, trade names and symbols) related to the Premises or the Accessories
or the design, construction, use or operation thereof, (iii) deposits (including
Grantor's rights in tenants' security deposits, deposits with respect to utility
services to the Premises, and any deposits or reserves under any Loan Instrument
for taxes, insurance or otherwise), money, accounts, instruments, documents,
notes and chattel paper arising from or by virtue of any transactions related to
the Premises or the Accessories together with any and all tax and/or insurance
escrow accounts and/or reserve accounts required under the provisions of any of
the Loan Instruments; (iv) permits, licenses, franchises, certificates,
certificates of occupancy, development rights, commitments and rights for
utilities, wells, septic systems and other rights and privileges obtained in
connection with the Premises or the Accessories; (v) leases, rents, royalties,
bonuses, issues, profits, revenues and other benefits of the Premises and the
Accessories; (vi) oil, gas and other hydrocarbons and other minerals produced
from or allocated to the Land and all products processed or obtained therefrom,
and the proceeds thereof, (vii) engineering, accounting, title, legal, and other
technical or business data concerning the Mortgaged Property (as defined below)
which are in the possession of Grantor or in which Grantor can otherwise grant a
security interest; and (viii) development fees, sales commissions and leasing
commissions; and (d) all (i) proceeds of or arising from the properties, rights,
titles and interests referred to above in this ARTICLE 2, including but not
limited to

<PAGE>

proceeds of any sale, lease or other disposition thereof, proceeds of each
policy of insurance relating thereto (including premium refunds), proceeds of
the taking thereof or of any rights appurtenant thereto, including change of
grade of streets, curb cuts or other rights of access, by eminent domain or
transfer in lieu thereof for public or quasi-public use under any law, and
proceeds arising out of any damage thereto; and (ii) other interests of every
kind and character which Grantor now has or hereafter acquires in, to or for the
benefit of the properties, rights, titles and interests referred to above in
this ARTICLE 2 and all property used or useful in connection therewith,
including but not limited to rights of ingress and egress and remainders,
reversions and reversionary rights or interests; and if the estate of Grantor in
any of the property referred to above in this ARTICLE 2 is a leasehold estate,
this conveyance shall include, and the lien created hereby shall encumber and
extend to, all other or additional title, estates, interests or rights which are
now owned or may hereafter be acquired by Grantor in or to the property demised
under the lease creating such leasehold estate. The above described property is
collectively referred to herein as the "MORTGAGED PROPERTY."

        TO HAVE AND TO HOLD the Mortgaged Property, together with the rights,
privileges and appurtenances thereto belonging, unto the Trustee and his
substitutes or successors, forever, and Grantor hereby binds itself and its
heirs, executors, administrators, personal representatives, successors and
assigns to warrant and forever defend the Mortgaged Property unto the Trustee,
his substitutes or successors and assigns, against the claim or claims of all
persons claiming or to claim the same or any part thereof.

                                   ARTICLE 3

                                  INDEBTEDNESS

        This Deed of Trust is given to secure the following:

        3.1 NOTE. Payment of the indebtedness evidenced by the Note.

        3.2 LOAN AGREEMENT. Performance of all obligations of Grantor under the
Loan Agreement, including without limitation all Obligations as defined therein.

        3.3 DEED OF TRUST. Payment of all sums advanced by Beneficiary to or for
the benefit of Grantor contemplated hereby and performance of all obligations
and covenants herein contained.

        3.4 OTHER INDEBTEDNESS. Payment of all other indebtedness, of whatever
kind or character, now owing or that may hereafter become owing by Grantor to
Beneficiary, whether such indebtedness is evidenced by note, open account,
overdraft, endorsement, surety agreement, guaranty, or otherwise.

        The obligations above described are hereinafter collectively called the
"INDEBTEDNESS." This Deed of Trust, the Note, the Loan Agreement, and any other
instrument given to evidence or further secure, govern or guarantee the
Indebtedness are hereinafter collectively called the "LOAN INSTRUMENTS." All
payments on the Indebtedness shall be payable at the address of Beneficiary as
set forth in SECTION 1.1 and, unless otherwise provided in any instrument
evidencing the Indebtedness, shall bear interest at the rate set forth in the
Note, but not in excess of the highest rate permitted by applicable law, from
the date of accrual of the Indebtedness until paid.

<PAGE>

                                   ARTICLE 4

                         ASSIGNMENT OF RENTS AND LEASES

        4.1 ASSIGNMENT OF RENTS, PROFITS, ETC. All of the Rents (as hereinafter
defined) derived from the Mortgaged Property or arising from the use or
enjoyment of any portion thereof or from any lease or agreement pertaining
thereto, are hereby absolutely and unconditionally assigned to Beneficiary, to
be applied by Beneficiary in payment of the Indebtedness. "RENTS" means all of
the rents, revenue, income, profits and proceeds derived and to be derived from
the Mortgaged Property or arising from the use or enjoyment of any portion
thereof or from any Lease (as hereinafter defined), including but not limited to
liquidated damages following default under any such Lease, or payments
applicable to a termination of a Lease, all proceeds payable under any policy of
insurance covering loss of rents resulting from damage to any part of the
Mortgaged Property, all rights that Grantor may have against any tenant under
any Lease or any subtenants or occupants of any part of the Mortgaged Property,
all of Grantor's rights to recover monetary amounts from any tenant in
bankruptcy including, without limitation, rights of recovery for use and
occupancy and damage claims arising out of Lease defaults, including rejections,
under any applicable debtor relief law, together with any sums of money that may
now or at any time hereafter be or become due and payable to Grantor by virtue
of any and all royalties, overriding royalties, bonuses, delay rentals and any
other amount of any kind or character arising under any and all present and all
future oil, gas, mineral and mining leases covering the Mortgaged Property or
any part thereof, and all proceeds and other amounts paid or owing to Grantor
under or pursuant to any and all contracts, and bonds relating to the
construction or renovation of the Mortgaged Property. Notwithstanding any
provision of this Deed of Trust or any other Loan Instrument which might be
construed to the contrary, the assignment in this Section is an absolute
assignment and not merely a security interest; however, Beneficiary's rights as
to the assignment shall be exercised only upon the occurrence of an Event of
Default (as hereinafter defined). Prior to an Event of Default, Grantor shall
have a license to collect and receive all Rents as trustee for the benefit of
Beneficiary and Grantor, and Grantor shall apply the funds so collected first to
the payment of the Indebtedness in such manner as Beneficiary elects and
thereafter to the account of Grantor. Upon the occurrence of an Event of
Default, such license in favor of Grantor shall automatically and immediately
terminate without any action or notice, or the necessity thereof, by Beneficiary
or any other party, and Beneficiary shall be entitled to immediate possession of
all Rents regardless of the value of the security for the Indebtedness and
regardless of whether Beneficiary has initiated any action to take possession of
any portion of the Mortgaged Property.

        4.2 ASSIGNMENT OF LEASES. Grantor hereby assigns to Beneficiary all of
Grantor's rights, but none of its obligations, under all Leases. "LEASE" and
"LEASES" means each and all existing or future leases, subleases (to the extent
of Grantor's rights thereunder) or other agreements under the terms of which any
person has or acquires any right to occupy or use any part of or interest in the
Mortgaged Property, and each and all existing or future guaranties of payment or
performance thereunder, and all extensions, renewals, modifications, supplements
and replacements of each such lease, sublease, agreement or guaranty upon any
part of the Mortgaged Property. Grantor hereby further assigns to Beneficiary
all guaranties of tenants' performance under the Leases. Prior to an Event of
Default, Grantor shall have the right, without joinder of Beneficiary, to
enforce the Leases, unless Beneficiary directs otherwise.

        4.3 WARRANTIES CONCERNING LEASES AND RENTS. Grantor represents and
warrants that:

        (a) Grantor has good title to the Leases and Rents hereby assigned and
authority to assign them, and no other person or entity has any right, title or
interest therein;

<PAGE>

        (b) all existing Leases are valid, unmodified and in full force and
effect, except as indicated herein, and no default exists thereunder;

        (c) unless otherwise provided herein, no Rents have been or will be
assigned, mortgaged or pledged;

        (d) no Rents have been or will be anticipated, waived, released,
discounted, set off or compromised by Grantor, unless in Grantor's good faith,
prudent business judgment, it would be in the best interest of the Mortgaged
Property to do so; and

        (e) except as indicated in the Leases, Grantor has not received any
funds or deposits from any tenant for which credit has not already been made on
account of accrued Rents.

        4.4 GRANTOR'S COVENANTS OF PERFORMANCE. Grantor covenants to:

        (a) perform all of its obligations under the Leases and give prompt
notice to Beneficiary of any failure to do so;

        (b) give immediate notice to Beneficiary of any notice Grantor receives
from any tenant or subtenant under any Leases, specifying any claimed default by
any party under such Leases;

        (c) enforce the tenants' obligations under the Leases unless in
Grantor's good faith, prudent business judgment, it would not be in the best
interest of the Mortgaged Property to do so;

        (d) defend, at Grantor's expense, any proceeding pertaining to the
Leases, including, if Beneficiary so requests, any such proceeding to which
Beneficiary is a party; and

        (e) neither create nor permit any encumbrance upon its interest as
lessor of the Leases, except this Deed of Trust and any other encumbrances
permitted by this Deed of Trust.

        4.5 PRIOR APPROVAL FOR ACTIONS AFFECTING LEASES. Grantor shall not,
without the prior written consent of Beneficiary:

        (a) receive or collect Rents more than one month in advance, except
security deposits obtained in advance in the ordinary course of business;

        (b) encumber or assign future Rents except pursuant to this Deed of
Trust;

        (c) waive or release any obligation of any tenant under the Leases
unless (1) in Grantor's good faith, prudent business judgment, it would be in
the best interest of the Mortgaged Property to do so, and (2) the obligation
waived or released is not a material obligation under the Lease in question;

        (d) amend, cancel, terminate or surrender any of the Leases, cause,
permit or accept any amendment, cancellation, termination or surrender of any of
the Leases, or commence any proceedings for dispossession of any tenant under
any of the Leases, except in good faith where the tenant is in material default
thereunder;

        (e) renew or extend any of the Leases, except pursuant to terms in
existing Leases unless (1) in Grantor's good faith, prudent business judgment,
it would be in the best interest of the Mortgaged Property to do so, and (2)
such renewal or extension is made at then prevailing market terms;

        (f) permit any assignment of the Leases; or

<PAGE>

        (g) enter into any Lease except a Lease on the form previously approved
by Beneficiary.

        4.6 SETTLEMENT FOR TERMINATION. Grantor agrees that no settlement for
damages for termination of any of the Leases under the Federal Bankruptcy Code,
or under any other federal, state, or local statute, shall be made without the
prior written consent of Beneficiary, and any check in payment of such damages
shall be made payable to both Grantor and Beneficiary. Grantor hereby assigns
any such payment to Beneficiary, to be applied to the Indebtedness as
Beneficiary may elect, and agrees to endorse any check for such payment to the
order of Beneficiary.

        4.7 MORTGAGEE IN POSSESSION. Beneficiary's acceptance of this assignment
shall not, prior to entry upon and taking possession of the Mortgaged Property
by Beneficiary, be deemed to constitute Beneficiary a "mortgagee in possession,"
nor obligate Beneficiary to appear in or defend any proceeding relating to any
of the Leases or to the Mortgaged Property, take any action hereunder, expend
any money, incur any expenses, or perform any obligation or liability under the
Leases, or assume any obligation for any deposits delivered to Grantor by any
lessee and not delivered to Beneficiary. Beneficiary shall not be liable for any
injury or damage to person or property in or about the Mortgaged Property.
Beneficiary neither has nor assumes any obligations as lessor or landlord with
respect to any Lease.

        4.8 APPOINTMENT OF ATTORNEY. Grantor hereby appoints Beneficiary its
attorney-in-fact, coupled with an interest empowering Beneficiary to subordinate
any Leases to this Deed of Trust.

        4.9 INDEMNIFICATION; HOLD HARMLESS. Grantor hereby indemnifies and holds
Beneficiary harmless from all liability, damage or expense incurred by
Beneficiary from any claims under the Leases arising out of events occurring on
or before the Release Date (as hereinafter defined), including, without
limitation, any claims by Grantor with respect to Rents paid directly to
Beneficiary after an Event of Default and claims by tenants for security
deposits or for rental payments more than one (1) month in advance and not
delivered to Beneficiary. All amounts indemnified against hereunder, including
attorneys' fees and expenses, if paid by Beneficiary shall bear interest at the
Default Rate (as defined in the Loan Agreement) and shall be payable by Grantor
immediately without demand and shall be secured hereby.

        4.10 RECORDS. Upon request by Beneficiary, Grantor shall deliver to
Beneficiary executed originals of all Leases and copies of all records relating
thereto.

        4.11 RIGHT TO RELY. Grantor hereby authorizes and directs the tenants
under the Leases to pay Rents to Beneficiary upon written demand by Beneficiary,
without further consent of Grantor and regardless of whether Beneficiary has
taken possession of any other portion of the Mortgaged Property, and the tenants
may rely upon any written statement delivered by Beneficiary to the tenants. Any
such payment to Beneficiary shall constitute payment to Grantor under the
Leases, and Grantor hereby appoints Beneficiary as Grantor's lawful
attorney-in-fact for giving, and is hereby empowered to give, acquittances to
any tenants for such Payments to Beneficiary after an Event of Default.

        4.12 RENTS. It is the intention of Beneficiary and Grantor that the
assignment effectuated by this Deed of Trust with respect to the Rents shall be
a direct and currently effective assignment and shall not constitute merely the
granting of a lien, security interest or pledge for the purpose of securing the
Indebtedness. In the event that a court of competent jurisdiction determines
that, notwithstanding such expressed intent of the parties, Beneficiary's
interest in the Rents constitutes a lien on or security interest in or pledge of
the Rents, it is agreed and understood that the forwarding of a notice to
Grantor after the occurrence of an Event of Default, advising Grantor of the
revocation of Grantor's license to collect such Rents, shall be sufficient
action by Beneficiary to (i) perfect such lien on or security interest in or
pledge of the Rents, (ii) take possession thereof and (iii) entitle Beneficiary
to immediate and direct payment of

<PAGE>

the Rents, for application as provided in this Deed of Trust, all without the
necessity of any further action by Beneficiary, including, without limitation,
any action to obtain possession of the Land, Improvements or any other portion
of the Mortgaged Property.

        4.13 UNILATERAL SUBORDINATION AND MERGER; APPROVAL OF LEASES. There
shall be no merger of the leasehold estates created by the Leases with the fee
estate of the Mortgaged Property without the prior written consent of
Beneficiary. Beneficiary may at any time and from time to time by specific
written instrument intended for the purpose, unilaterally subordinate the lien
of this Deed of Trust to any Lease, without joinder or consent of, or notice to,
Grantor, any tenant or any other person, and notice is hereby given to each
tenant under a Lease of such right to subordinate. No such subordination shall
constitute a subordination to any lien or other encumbrance, whenever arising,
or improve the right of any junior lienholder. Nothing herein shall be construed
as subordinating this Deed of Trust to any Lease.

                                   ARTICLE 5

                   SECURITY AGREEMENT AND FINANCING STATEMENT

        5.1 SECURITY INTEREST. This Deed of Trust shall be a security agreement
between Grantor, as the debtor, and Beneficiary, as the secured party, covering
the Mortgaged Property constituting personal property or fixtures governed by
the Texas Business and Commerce Code (the "CODE") and for the purpose of further
securing payment and performance of the Indebtedness, Grantor grants to
Beneficiary a security interest and lien in all rights, titles and interests now
owned or hereafter acquired by Grantor in the portion of the Mortgaged Property
constituting personal property or fixtures governed by the Code (the
"COLLATERAL"). In addition to Beneficiary's other rights hereunder, Beneficiary
shall have all rights of a secured party under the Code. Grantor shall execute
and deliver to Beneficiary all financing statements that may be required by
Beneficiary to establish and maintain the validity and priority of Beneficiary's
security interest in the Collateral, and Grantor shall bear all costs thereof,
including all Code searches reasonably required by Beneficiary.

        5.2 NOTICE OF CHANGES. Grantor shall give advance notice in writing to
Beneficiary of any proposed change in Grantor's name, identity, jurisdiction of
organization, or structure and shall execute and deliver to Beneficiary, prior
to or concurrently with the occurrence of any such change, all additional
financing statements that Beneficiary may require to establish and maintain the
validity and priority of Beneficiary's security interest with respect to any of
the Mortgaged Property described or referred to herein.

        5.3 FIXTURES. This Deed of Trust shall be effective as a financing
statement filed as a fixture filing with respect to all items of the Collateral
described herein that are or are to become fixtures related to the Land, and
this Deed of Trust shall be effective as such from the date of its filing for
record in the real estate records of the county in which the Collateral is
situated. Information concerning the security interest created by this
instrument may be obtained from Beneficiary, as secured party, at the address of
Beneficiary stated in SECTION 1.1. The exact legal name, type of organization,
jurisdiction of organization, and mailing address of the Grantor, as debtor, are
as stated in SECTION 1.2, and the organizational identification number of the
Grantor is as stated above the introductory paragraph of this Deed of Trust. The
mailing address of the Grantor, as debtor, is as stated in SECTION 1.2. Grantor
does have an interest of record in the Land, and the names of any additional
record owners of the Land are listed on EXHIBIT A. Proceeds and products of the
portion of the Collateral constituting fixtures are also covered. Beneficiary
shall have the right, without the consent or joinder of Grantor, to file with
any governmental authority such financing statements, financing statement
amendments and continuation statements as may, in the sole discretion of
Beneficiary, be necessary or advisable to maintain, perfect or otherwise
evidence the lien of Beneficiary in and to any of the Collateral. Grantor, as
debtor, hereby expressly authorizes

<PAGE>

Beneficiary, as secured party, to file any such financing statement without the
signature of Grantor to the extent permitted by applicable law.

        5.4 REPRODUCTIONS. A carbon, photostatic or other reproduction of this
Deed of Trust shall be sufficient as a financing statement. Beneficiary shall
have the right at any time to file a manually executed counterpart or a carbon,
photostatic or other reproduction of this Deed of Trust as a financing statement
in either the central or local UCC records of any jurisdiction wherein the
Collateral is situated, but the failure of Beneficiary to do so shall not impair
(a) the effectiveness of this Deed of Trust as a fixture filing as permitted by
Section 9.502(c) of the Code, or (b) the validity and enforceability of this
Deed of Trust in any respect whatsoever.

                                   ARTICLE 6

                     REPRESENTATIONS, WARRANTIES, COVENANTS

                            AND AGREEMENTS OF GRANTOR

        Grantor does hereby covenant, warrant and represent to and agree with
Beneficiary as follows:

        6.1 PAYMENT AND PERFORMANCE. Grantor shall make all payments on the
Indebtedness when due and shall punctually and properly perform all of Grantor's
covenants, obligations and liabilities under the Loan Instruments.

        6.2 TITLE TO MORTGAGED PROPERTY AND LIEN OF THIS DEED OF TRUST. Grantor
has good and indefeasible title to the Land and the Improvements, and good and
marketable title to the Collateral, free and clear of any liens, charges,
encumbrances security interests, and adverse claims whatsoever, except (a)
permitted encumbrances set forth on EXHIBIT B hereto, which are permitted
encumbrances only to the extent the same are valid and subsisting and affect the
Mortgaged Property, (b) the liens and security interests evidenced by this Deed
of Trust, (c) statutory liens for taxes on the Mortgaged Property which are not
yet delinquent, (d) mechanics' and materialman's liens with respect to
obligations which are not past due, (e) other liens and security interests, if
any, in favor of Beneficiary, and (f) purchase money security interests upon or
in assets acquire or held by Grantor in the ordinary course of business to
secure the purchase price of such property or secure indebtedness incurred
solely for the purpose of financing the acquisition of such property (the
matters described in the foregoing clauses (a) - (f) being herein called the
"PERMITTED ENCUMBRANCES"). Grantor, and Grantor's successors and assigns, will
warrant and forever defend title to the Mortgaged Property, subject as
aforesaid, to Trustee and his successors or substitutes and assigns, against the
claims and demands of all persons claiming or to claim the same or any part
thereof. Grantor will punctually pay, perform, observe and keep all covenants,
obligations and conditions in or pursuant to any Permitted Encumbrance and will
not modify or permit modification of any Permitted Encumbrance without the prior
written consent of Beneficiary. Inclusion of any matter as a Permitted
Encumbrance does not constitute approval or waiver by Beneficiary of any
existing or future violation or other breach thereof by Grantor, by the
Mortgaged Property or otherwise. No part of the Mortgaged Property constitutes
all or any part of the business or residential homestead of Grantor. If any
right or interest of Beneficiary in the Mortgaged Property or any part thereof
shall be endangered or questioned or shall be attacked directly or indirectly,
Trustee and Beneficiary, or either of them (whether or not named as parties to
legal proceedings with respect thereto), are hereby authorized and empowered to
take such steps as in their discretion may be proper for the defense of any such
legal proceedings or the protection of such right or interest of Beneficiary,
including but not limited to the employment of independent counsel, the
prosecution or defense of litigation, and the compromise or discharge of adverse
claims. All expenditures so made of every kind and character shall be a demand
obligation (which obligation Grantor hereby promises to pay) owing by Grantor to
Beneficiary or Trustee (as the case may

<PAGE>

be), and the party (Beneficiary or Trustee, as the case may be) making such
expenditures shall be subrogated to all rights of the person receiving such
payment.

        6.3 STATUS OF GRANTOR; SUITS AND CLAIMS; LOAN INSTRUMENTS. If Grantor is
a corporation, partnership, or other legal entity, Grantor is and will continue
to be (a) duly organized, validly existing and in good standing under the laws
of its state of organization, (b) authorized to do business in, and in good
standing in, each state in which the Mortgaged Property is located, and (c)
possessed of all requisite power and authority to carry on its business and to
own and operate the Mortgaged Property. Each Loan Instrument executed by Grantor
has been duly authorized, executed and delivered by Grantor, and the obligations
thereunder and the performance thereof by Grantor in accordance with their terms
are and will continue to be within Grantor's power and authority (without the
necessity of joinder or consent of any other person), are not and will not be in
contravention of any legal requirement to which Grantor or the Mortgaged
Property is subject, and do not and will not result in the creation of any
encumbrance against any assets or properties of Grantor, or any other person
liable, directly or indirectly, for any of the Indebtedness, except as expressly
contemplated by the Loan Instruments. There is no suit, action, claim,
investigation, inquiry, proceeding or demand pending (or, to Grantor's
knowledge, threatened) which affects the Mortgaged Property (including, without
limitation, any which challenges or otherwise pertains to Grantor's title to the
Mortgaged Property) or the validity, enforceability or priority of any of the
Loan Instruments. There is no judicial or administrative action, suit or
proceeding pending (or, to Grantor's knowledge, threatened) against Grantor, or
against any other person liable directly or indirectly for the Indebtedness,
except as has been disclosed in writing to Beneficiary in connection with the
loans evidenced by the Note. The Loan Instruments constitute legal, valid and
binding obligations of Grantor (and of each guarantor, if any) enforceable in
accordance with their terms, except as the enforceability thereof may be limited
by debtor relief laws and except as the availability of certain remedies may be
limited by general principles of equity. Grantor is not a "foreign person"
within the meaning of the Internal Revenue Code of 1986, as amended, Sections
1445 and 7701 (i.e., Grantor is not a non-resident alien, foreign corporation,
foreign partnership, foreign trust or foreign estate as those terms are defined
therein and in any regulations promulgated thereunder). Grantor will not cause
or permit any change to be made in its name, identity, structure, or
jurisdiction of organization, unless Grantor shall have notified Beneficiary of
such change prior to the effective date of such change, and shall have first
taken all action required by Beneficiary for the purpose of further perfecting
or protecting the lien and security interest of Beneficiary in the Mortgaged
Property. Grantor's principal place of business and chief executive office, and
the place where Grantor keeps its books and records concerning the Mortgaged
Property, has for the preceding four months been and will continue to be (unless
Grantor notifies Beneficiary of any change in writing prior to the date of such
change) the address of Grantor set forth in SECTION 1.2.

        6.4 EXISTENCE OF GRANTOR. Grantor shall preserve and keep in full force
and effect its existence, rights, franchises, and trade names.

        6.5 INSURANCE. Grantor shall obtain and maintain at Grantor's sole
expense: (a) mortgagee title insurance issued to Beneficiary covering the
Premises as required by Beneficiary; and (b) such other insurance as may be
required by Beneficiary from time to time pursuant to and in accordance with the
Loan Agreement. Upon any foreclosure hereof or transfer of title to the
Mortgaged Property in extinguishment of the whole or any part of the
Indebtedness, all of Grantor's right, title and interest in and to the insurance
policies referred to in this Section (including unearned premiums) and all
proceeds payable thereunder shall thereupon vest in the purchaser at foreclosure
or other such transferee, to the extent permissible under such policies.
Beneficiary shall have the right (but not the obligation) to make proof of loss
for, settle and adjust any claim under, and receive the proceeds of, all
insurance for loss of or damage to the Mortgaged Property, and the expenses
incurred by Beneficiary in the adjustment and collection of insurance proceeds
shall be a part of the Indebtedness and shall be due and payable to Beneficiary
on demand. Beneficiary shall not be, under any circumstances, liable or
responsible for

<PAGE>

failure to collect or exercise diligence in the collection of any of such
proceeds or for the obtaining, maintaining or adequacy of any insurance or for
failure to see to the proper application of any amount paid over to Grantor. Any
such proceeds received by Beneficiary shall, after deduction therefrom of all
reasonable expenses actually incurred by Beneficiary, including attorneys' fees,
at Beneficiary's option be (1) released to Grantor, or (2) applied (upon
compliance with such terms and conditions as may be required by Beneficiary) to
repair or restoration, either partly or entirely, of the Mortgaged Property so
damaged, or (3) applied to the payment of the Indebtedness in such order and
manner as Beneficiary, in its sole discretion, may elect, whether or not due. In
any event, the unpaid portion of the Indebtedness shall remain in full force and
effect and the payment thereof shall not be excused. Grantor shall at all times
comply with the requirements of the insurance policies required hereunder and of
the issuers of such policies and of any board of fire underwriters or similar
body as applicable to or affecting the Mortgaged Property.

        6.6 TAXES AND ASSESSMENTS. Grantor shall pay all taxes and assessments
against or affecting the Mortgaged Property as the same become due and payable
(except those being Contested in Good Faith, as defined in the Loan Agreement),
and, upon request by Beneficiary, Grantor shall deliver to Beneficiary such
evidence of the payment thereof as Beneficiary may require, and, if Grantor
fails to do so, Beneficiary may pay them, together with all costs and penalties
thereon, at Grantor's expense.

        6.7 RESERVE FOR INSURANCE, TAXES AND ASSESSMENTS. Upon request of
Beneficiary, Grantor will deposit with Beneficiary a sum equal to ad valorem
taxes, assessments and charges (which charges for the purpose of this paragraph
shall include without limitation any recurring charge which could result in a
lien against the Mortgaged Property) against the Mortgaged Property for the
current year and the premiums for such policies of insurance for the current
year, all as estimated by Beneficiary and prorated to the end of the calendar
month following the month during which Beneficiary's request is made, and
thereafter will deposit with Beneficiary, on each date when an installment of
principal and/or interest is due on the Note, sufficient funds (as estimated
from time to time by Beneficiary) to permit Beneficiary to pay at least fifteen
(15) days prior to the due date thereof, the next maturing ad valorem taxes,
assessments and charges and premiums for such policies of insurance. Beneficiary
shall have the right to rely upon tax information furnished by applicable taxing
authorities in the payment of such taxes or assessments and shall have no
obligation to make any protest of any such taxes or assessments. Any excess over
the amounts required for such purposes shall be held by Beneficiary for future
use, applied to any Indebtedness or refunded to Grantor, at Beneficiary's
option, and any deficiency in such funds so deposited shall be made up by
Grantor upon demand of Beneficiary. All such funds so deposited shall bear no
interest, may be mingled with the general funds of Beneficiary and shall be
applied by Beneficiary toward the payment of such taxes, assessments, charges
and premiums when statements therefor are presented to Beneficiary by Grantor
(which statements shall be presented by Grantor to Beneficiary a reasonable time
before the applicable amount is due); provided, however, that, if a default
shall have occurred hereunder, such funds may at Beneficiary's option be applied
to the payment of the Indebtedness in the order determined by Beneficiary in its
sole discretion, and that Beneficiary may (but shall have no obligation) at any
time, in its discretion, apply all or any part of such funds toward the payment
of any such taxes, assessments, charges or premiums which are past due, together
with any penalties or late charges with respect thereto. The conveyance or
transfer of Grantor's interest in the Mortgaged Property for any reason
(including without limitation the foreclosure of a subordinate lien or security
interest or a transfer by operation of law) shall constitute an assignment or
transfer of Grantor's interest in and rights to such funds held by Beneficiary
under this paragraph but subject to the rights of Beneficiary hereunder. The
obligations of Beneficiary under this Section are subject to the provisions of
Sections 7.1 and 7.2 of the Loan Agreement.

        6.8 CONDEMNATION. Grantor shall notify Beneficiary immediately of any
threatened or pending proceeding for condemnation affecting the Mortgaged
Property or arising out of damage to the

<PAGE>

Mortgaged Property, and Grantor shall, at Grantor's expense, diligently
prosecute any such proceedings. Beneficiary shall have the right (but not the
obligation) to participate in any such proceeding and to be represented by
counsel of its own choice. Beneficiary shall be entitled to receive all sums
which may be awarded or become payable to Grantor for the condemnation of the
Mortgaged Property, or any part thereof, for public or quasi-public use, or by
virtue of private sale in lieu thereof, and any sums which may be awarded or
become payable to Grantor for injury or damage to the Mortgaged Property.
Grantor shall, promptly upon request of Beneficiary, execute such additional
assignments and other documents as may be necessary from time to time to permit
such participation and to enable Beneficiary to collect and receipt for any such
sums. All such sums are hereby assigned to Beneficiary, and shall, after
deduction therefrom of all reasonable expenses actually incurred by Beneficiary,
including attorneys' fees, at Beneficiary's option be (a) released to Grantor,
or (b) applied (upon compliance with such terms and conditions as may be
required by Beneficiary) to repair or restoration of the Mortgaged Property so
affected, or (c) applied to the payment of the Indebtedness in such order and
manner as Beneficiary, in its sole discretion, may elect, whether or not due. In
any event the unpaid portion of the Indebtedness shall remain in full force and
effect and the payment thereof shall not be excused. Beneficiary shall not be,
under any circumstances, liable or responsible for failure to collect or to
exercise diligence in the collection of any such sum or for failure to see to
the proper application of any amount paid over to Grantor. Beneficiary is hereby
authorized, in the name of Grantor, to execute and deliver valid acquittances
for, and to appeal from, any such award, judgment or decree. All costs and
expenses (including but not limited to attorneys' fees) incurred by Beneficiary
in connection with any condemnation shall be a demand obligation owing by
Grantor (which Grantor hereby promises to pay) to Beneficiary pursuant to this
Deed of Trust.

        6.9 TAXES ON NOTE OR DEED OF TRUST. Grantor will promptly pay all
income, franchise and other taxes owing by Grantor and any stamp taxes or other
taxes (unless such payment by Grantor is prohibited by law) which may be
required to be paid with respect to the Note, this Deed of Trust or any other
instrument evidencing or securing any of the Indebtedness. In the event of the
enactment after this date of any law of any governmental entity applicable to
Beneficiary, the Note, the Mortgaged Property or this Deed of Trust deducting
from the value of property for the purpose of taxation any lien or security
interest thereon, or imposing upon Beneficiary the payment of the whole or any
part of the taxes or assessments or charges or liens herein required to be paid
by Grantor, or changing in any way the laws relating to the taxation of deeds of
trust or mortgages or security agreements or debts secured by deeds of trust or
mortgages or security agreements or the interest of the mortgagee or secured
party in the property covered thereby, or the manner of collection of such
taxes, so as to affect this Deed of Trust or the Indebtedness or Beneficiary,
then, and in any such event, Grantor, upon demand by Beneficiary, shall pay such
taxes, assessments, charges or liens, or reimburse Beneficiary therefor;
provided, however, that if in the opinion of counsel for Beneficiary (a) it
might be unlawful to require Grantor to make such payment or (b) the making of
such payment might result in the imposition of interest beyond the maximum
amount permitted by law, then and in such event, Beneficiary may elect, by
notice in writing given to Grantor, to declare all of the Indebtedness to be and
become due and payable sixty (60) days from the giving of such notice.

        6.10 STATEMENT BY GRANTOR. Grantor shall at any time and from time to
time furnish within seven (7) days of request by Beneficiary a written statement
in such form as may be required by Beneficiary stating that (a) the Note, this
Deed of Trust and the other Loan Instruments are valid and binding obligations
of Grantor, enforceable against Grantor in accordance with their terms; (b) the
unpaid principal balance of the Note; (c) the date to which interest on the Note
is paid; (d) the Note, this Deed of Trust and the other Loan Instruments have
not been released, subordinated or modified; and (e) there are no offsets or
defenses against the enforcement of the Note, this Deed of Trust or any other
Loan Instrument. If any of the foregoing statements are untrue, Grantor shall,
alternatively, specify the reasons therefor.

<PAGE>

        6.11 MAINTENANCE, REPAIR AND RESTORATION. Grantor will keep the
Mortgaged Property in first class order, repair, operating condition and
appearance, causing all necessary repairs, renewals, replacements, additions and
improvements to be promptly made, and will not allow any of the Mortgaged
Property to be misused, abused or wasted or to deteriorate. Notwithstanding the
foregoing, Grantor will not, without the prior written consent of Beneficiary,
(a) remove from the Mortgaged Property any fixtures or personal property covered
by this Deed of Trust except such as is replaced by Grantor by an article of
equal suitability and value, owned by Grantor, free and clear of any lien or
security interest (except that created by this Deed of Trust), or (b) make any
structural alteration to the Mortgaged Property or any other alteration thereto
which impairs the value thereof. If any act or occurrence of any kind or nature
(including any condemnation or any casualty for which insurance was not obtained
or obtainable) shall result in damage to or loss or destruction of the Mortgaged
Property, Grantor shall give prompt notice thereof to Beneficiary and Grantor
shall promptly, at Grantor's sole cost and expense and regardless of whether
insurance or condemnation proceeds (if any) shall be available or sufficient for
the purpose, commence and continue diligently to completion to restore, repair,
replace and rebuild the Mortgaged Property as nearly as possible to its value,
condition and character immediately prior to the damage, loss or destruction.

        6.12 NO OTHER LIENS. Grantor will not, without the prior written consent
of Beneficiary, create, place or permit to be created or placed, or through any
act or failure to act, acquiesce in the placing of, or allow to remain, any deed
of trust, mortgage, voluntary or involuntary lien, whether statutory,
constitutional or contractual, security interest, encumbrance or charge, or
conditional sale or other title retention document, against or covering the
Mortgaged Property, or any part thereof, other than the Permitted Encumbrances,
regardless of whether the same are expressly or otherwise subordinate to the
lien or security interest created in this Deed of Trust, and should any of the
foregoing become attached hereafter in any manner to any part of the Mortgaged
Property without the prior written consent of Beneficiary, Grantor will cause
the same to be promptly discharged and released. If Beneficiary consents to the
voluntary grant by Grantor of any lien, security interest, or other encumbrance
(hereinafter called "SUBORDINATE MORTGAGE") covering any of the Mortgaged
Property or if the foregoing prohibition is determined by a court of competent
jurisdiction to be unenforceable as to a Subordinate Mortgage, any such
Subordinate Mortgage shall contain express covenants to the effect that: (1) the
Subordinate Mortgage is unconditionally subordinate to this Deed of Trust and
all Leases; (2) if any action (whether judicial or pursuant to a power of sale)
shall be instituted to foreclose or otherwise enforce the Subordinate Mortgage,
no tenant of any of the Leases (hereinafter defined) shall be named as a party
defendant, and no action shall be taken that would terminate any occupancy or
tenancy without the prior written consent of Beneficiary; (3) Rents, if
collected by or for the holder of the Subordinate Mortgage, shall be applied
first to the payment of the Indebtedness then due and expenses incurred in the
ownership, operation and maintenance of the Mortgaged Property in such order as
Beneficiary may determine, prior to being applied to any indebtedness by the
Subordinate Mortgage; (4) written notice of default under the Subordinate
Mortgage and written notice of the commencement of any action (whether judicial
or pursuant to a power of sale) to foreclose or otherwise enforce the
Subordinate Mortgage or to seek the appointment of a receiver for all or any
part of the Mortgaged Property shall be given to Beneficiary with or immediately
after the occurrence of any such default or commencement; and (5) neither the
holder of the Subordinate Mortgage, nor any purchaser at foreclosure thereunder,
nor anyone claiming by, through or under any of them shall succeed to any of
Grantor's rights hereunder without the prior written consent of Beneficiary.

        6.13 OPERATION OF MORTGAGED PROPERTY. Grantor will operate the Mortgaged
Property in a good and workmanlike manner and in accordance with all legal
requirements and will pay all fees or charges of any kind in connection
therewith. Grantor will keep the Mortgaged Property occupied so as not to impair
the insurance carried thereon. Grantor will not use or occupy or conduct any
activity on, or allow the use or occupancy of or the conduct of any activity on,
the Mortgaged Property in any manner which violates any legal requirement or
which constitutes a public or private nuisance or which makes void, voidable or
cancelable, or increases the premium of, any insurance then in force with
respect thereto. Grantor will not initiate or permit any zoning reclassification
of the Mortgaged Property or seek any variance under existing zoning ordinances
applicable to the Mortgaged Property or use or permit the use of the Mortgaged
Property in such a manner

<PAGE>

which would result in such use becoming a nonconforming use under applicable
zoning ordinances or other legal requirement. Grantor will not impose any
easement, restrictive covenant or encumbrance upon the Mortgaged Property,
execute or file any subdivision plat or condominium declaration affecting the
Mortgaged Property or consent to the annexation of the Mortgaged Property to any
municipality, without the prior written consent of Beneficiary. Grantor will not
do or suffer to be done any act whereby the value of any part of the Mortgaged
Property may be lessened. Grantor will preserve, protect, renew, extend and
retain all material rights and privileges granted for or applicable to the
Mortgaged Property. Without the prior written consent of Beneficiary, there
shall be no drilling or exploration for or extraction, removal or production of
any mineral, hydrocarbon, gas, natural element, compound or substance (including
sand and gravel) from the surface or subsurface of the Land regardless of the
depth thereof or the method of mining or extraction thereof. Grantor will cause
all debts and liabilities of any character (including without limitation all
debts and liabilities for labor, material and equipment and all debts and
charges for utilities servicing the Mortgaged Property) incurred in the
construction, maintenance, operation and development of the Mortgaged Property
to be promptly paid except to the extent the same are being Contested in Good
Faith (as defined in the Loan Agreement).

        6.14 FINANCIAL MATTERS. Grantor is solvent after giving effect to all
borrowings contemplated by the Loan Instruments and no proceeding under any
debtor relief law is pending (or, to Grantor's knowledge, threatened) by or
against Grantor, or any affiliate of Grantor, as a debtor. All reports,
statements, plans, budgets, applications, agreements and other data and
information heretofore furnished or hereafter to be furnished by or on behalf of
Grantor to Beneficiary in connection with the loan or loans evidenced by the
Loan Instruments (including, without limitation, all financial statements and
financial information) are and will be true, correct and complete in all
material respects as of their respective dates and do not and will not omit to
state any fact or circumstance necessary to make the statements contained
therein not misleading. No material adverse change has occurred since the dates
of such reports, statements and other data in the financial condition of Grantor
or, to Grantor's knowledge, of any tenant under any lease described therein. For
the purposes of this paragraph, "GRANTOR" shall also include any person liable
directly or indirectly for the Indebtedness or any part thereof and any joint
venturer or general partner of Grantor.

        6.15 COMPLIANCE WITH LAWS. The Mortgaged Property and the use, operation
and maintenance thereof and all activities thereon do and shall at all times
comply with all applicable legal requirements. The Mortgaged Property is not,
and shall not be, dependent on any other property or premises or any interest
therein other than the Mortgaged Property to fulfill any requirement of any
legal requirement. Grantor shall not, by act or omission, permit any building or
other improvement not subject to the lien of this Deed of Trust to rely on the
Mortgaged Property or any interest therein to fulfill any requirement of any
legal requirement. No part of the Mortgaged Property constitutes a nonconforming
use under any zoning law or similar law or ordinance. Grantor has obtained and
shall preserve in force all requisite zoning, utility, building, health and
operating permits from the governmental authorities having jurisdiction over the
Mortgaged Property. If Grantor receives a notice or claim from any person that
the Mortgaged Property, or any use, activity, operation or maintenance thereof
or thereon, is not in compliance with any legal requirement, Grantor will
promptly furnish a copy of such notice or claim to Beneficiary. Grantor has
received no notice and has no knowledge of any such noncompliance.

        6.16 INCOME, EXPENSE AND FINANCIAL STATEMENTS. Grantor will keep
accurate books and records in accordance with sound accounting principles in
which full, true and correct entries shall be

<PAGE>

promptly made with respect to the Mortgaged Property and the operation thereof,
and will permit all such books and records to be inspected and copied, and the
Mortgaged Property to be inspected and photographed, by Beneficiary and its
representatives during normal business hours and at any other reasonable times.
Grantor will furnish to Beneficiary at Grantor's expense all evidence which
Beneficiary may from time to time reasonably request as to compliance with all
provisions of the Loan Instruments. Any inspection or audit of the Mortgaged
Property or the books and records of Grantor, or the procuring of documents and
financial and other information, by or on behalf of Beneficiary shall be for
Beneficiary's protection only, and shall not constitute any assumption of
responsibility to Grantor or anyone else with regard to the condition,
construction, maintenance or operation of the Mortgaged Property nor
Beneficiary's approval of any certification given to Beneficiary nor relieve
Grantor of any of Grantor's obligations.

        6.17 INDEMNIFICATION.

        (a) Grantor will indemnify and hold harmless Beneficiary and Trustee
from and against, and reimburse them on demand for, any and all Indemnified
Matters (defined below). For purposes of this SECTION 6.17, the terms
"BENEFICIARY" and "TRUSTEE" shall include the directors, officers, partners,
employees and agents of Trustee and Beneficiary, respectively, and any persons
owned or controlled by, owning or controlling, or under common control or
affiliated with Beneficiary or Trustee, respectively. WITHOUT LIMITATION, THE
FOREGOING INDEMNITIES SHALL APPLY TO EACH INDEMNIFIED PERSON WITH RESPECT TO
MATTERS WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF, OR ARE CLAIMED
TO BE CAUSED BY OR ARISE OUT OF, THE NEGLIGENCE OR STRICT LIABILITY OF SUCH
(AND/OR ANY OTHER) INDEMNIFIED PERSON. HOWEVER, SUCH INDEMNITIES SHALL NOT APPLY
TO A PARTICULAR INDEMNIFIED PERSON TO THE EXTENT THAT THE SUBJECT OF THE
INDEMNIFICATION IS CAUSED BY OR ARISES OUT OF THE GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OF THAT INDEMNIFIED PERSON. Any amount to be paid under this SECTION
6.17 by Grantor to Beneficiary and/or Trustee shall be a demand obligation owing
by Grantor (which Grantor hereby promises to pay) to Beneficiary and/or Trustee
pursuant to this Deed of Trust. Nothing in this paragraph, elsewhere in this
Deed of Trust or in any other Loan Instrument shall limit or impair any rights
or remedies of Beneficiary and/or Trustee (including without limitation any
rights of contribution or indemnification) against Grantor or any other person
under any other provision of this Deed of Trust, any other Loan Instrument, any
other agreement or any applicable legal requirement.

        (b) As used herein, the term "INDEMNIFIED MATTERS" means any and all
claims, demands, liabilities (including strict liability), losses, damages
(including consequential damages), causes of action, judgments, penalties, costs
and expenses (including without limitation, reasonable fees and expenses of
attorneys and other professional consultants and experts, and of the
investigation and defense of any claim, whether or not such claim is ultimately
withdrawn or defeated, and the settlement of any claim or judgment including all
value paid or given in settlement) of every kind, known or unknown, foreseeable
or unforeseeable, which may be imposed upon, asserted against or incurred or
paid by Beneficiary and/or Trustee at any time and from time to time, whenever
imposed, asserted or incurred, because of, resulting from, in connection with,
or arising out of any transaction, act, omission, event or circumstance in any
way connected with the Mortgaged Property or with this Deed of Trust or any
other Loan Instrument, including but not limited to any bodily injury or death
or property damage occurring in or upon or in the vicinity of the Mortgaged
Property through any cause whatsoever at any time on or before the Release Date
(as hereinafter defined), any act performed or omitted to be performed hereunder
or under any other Loan Instrument, any breach by Grantor of any representation,
warranty, covenant, agreement or condition contained in this Deed of Trust or in
any other Loan Instrument, any Default as defined herein, any claim under or
with respect to any Lease and any Environmental Matter (defined below). As used
herein, the term "ENVIRONMENTAL MATTER" means: (a) the presence of any Hazardous
Materials (as

<PAGE>

defined in SECTION 7.1 hereof) on, in, under, above or about the
Mortgaged Property, or the migration or release or threatened migration or
release of any Hazardous Materials on, to, from or through the Mortgaged
Property, on or at any time before the Release Date; or (b) any act, omission,
event or circumstance existing or occurring in connection with the handling,
treatment, containment, removal, storage, decontamination, clean-up, transport
or disposal of any Hazardous Materials which is at any time on or before the
Release Date present on, in, under, above or about the Mortgaged Property; or
(c) any violation on or before the Release Date, of any Governmental Requirement
in effect on or before the Release Date, regardless of whether any act,
omission, event or circumstance giving rise to the violation constituted a
violation at the time of the occurrence or inception of such act, omission,
event or circumstance; or (d) any environmental claim, or the filing or
imposition of any environmental lien against the Mortgaged Property, because of,
resulting from, in connection with, or arising out of any of the matters
referred to in clauses (a) through (c) preceding; and regardless of whether any
of the matters referred to in the foregoing clauses (a) through (d) was caused
by Grantor or Grantor's tenant or any subtenant, or a prior owner of the
Mortgaged Property or its tenant or any subtenant, or any third party. Without
limitation of the definition of Indemnified Matters herein, Grantor's
indemnification obligations regarding any Environmental Matter shall include
injury or damage to any person, property or natural resource occurring upon or
off of the Mortgaged Property (including but not limited to the cost of
demolition and rebuilding of any improvements on real property), the preparation
of any feasibility studies or reports and the performance of any cleanup,
remediation, removal, response, abatement, containment, closure, restoration,
monitoring or similar work required by any Governmental Requirement or necessary
to have the full use and benefit of the Mortgaged Property as contemplated by
the Loan Instruments (including, without limitation, any of the same in
connection with any foreclosure or transfer in lieu thereof), and all liability
to pay or indemnify any person for costs in connection with any of the
foregoing. The term "RELEASE DATE" as used herein means the earlier of the
following two dates: (i) the date on which the Indebtedness secured hereby has
been paid and performed in full and this Deed of Trust has been released, or
(ii) the date on which the lien of this Deed of Trust is fully and finally
foreclosed or a conveyance by deed in lieu of such foreclosure is fully and
finally effective, and possession of the Mortgaged Property has been given to
the purchaser or grantee free of occupancy and claims to occupancy by Grantor
and Grantor's heirs, devisees, representatives, successors and assigns;
provided, that if such payment, performance, release, foreclosure or conveyance
is challenged, in bankruptcy proceedings or otherwise, the Release Date shall be
deemed not to have occurred until such challenge is rejected, dismissed or
withdrawn with prejudice. The indemnities in this SECTION 6.17 shall not
terminate upon the Release Date or upon the release, foreclosure or other
termination of this Deed of Trust but will survive the Release Date, foreclosure
of this Deed of Trust or conveyance in lieu of foreclosure, the repayment of the
Indebtedness, the discharge and release of this Deed of Trust and the other Loan
Instruments, any bankruptcy or other debtor relief proceeding, and any other
event whatsoever.

        6.18 TRADE NAMES. At the request of Beneficiary, Grantor shall execute a
certificate in form satisfactory to Beneficiary listing the trade names under
which Grantor intends to operate the Mortgaged Property, and representing and
warranting that Grantor does business under no other trade name with respect to
the Mortgaged Property. Grantor shall immediately notify Beneficiary in writing
of any change in said trade names, and shall, upon request of Beneficiary,
execute any additional financing statements and other certificates required to
reflect the change in trade names and shall execute and file any assumed name
certificate required by applicable laws.

        6.19 FURTHER ASSURANCES. Grantor will, promptly on request of
Beneficiary, (a) correct any defect, error or omission which may be discovered
in the contents, execution or acknowledgment of this Deed of Trust or any other
Loan Instrument; (b) execute, acknowledge, deliver, procure and record and/or
file such further documents (including, without limitation, further deeds of
trust, security agreements, financing statements, continuation statements, and
assignments of rents or leases) and do such further acts as may be necessary,
desirable or proper to carry out more effectively the purposes of this Deed of
Trust

<PAGE>

and the other Loan Instruments, to more fully identify and subject to the
liens and security interests hereof any property intended to be covered hereby
(including specifically, but without limitation, any renewals, additions,
substitutions, replacements, or appurtenances to the Mortgaged Property) or as
deemed advisable by Beneficiary to protect the lien or the security interest
hereunder against the rights or interests of third persons; and (c) provide such
certificates, documents, reports, information, affidavits and other instruments
and do such further acts as may be necessary, desirable or proper in the
reasonable determination of Beneficiary to enable Beneficiary to comply with the
requirements or requests of any agency having jurisdiction over Beneficiary or
any examiners of such agencies with respect to the Indebtedness, Grantor or the
Mortgaged Property. Grantor shall pay all costs connected with any of the
foregoing, which shall be a demand obligation owing by Grantor (which Grantor
hereby promises to pay) to Beneficiary pursuant to this Deed of Trust.

        6.20 FEES AND EXPENSES. Without limitation of any other provision of
this Deed of Trust or of any other Loan Instrument and to the extent not
prohibited by applicable law, Grantor will pay, and will reimburse to
Beneficiary and/or Trustee on demand to the extent paid by Beneficiary and/or
Trustee: (a) all appraisal fees, filing and recording fees, taxes, brokerage
fees and commissions, abstract fees, title search or examination fees, title
policy and endorsement premiums and fees, uniform commercial code search fees,
escrow fees, reasonable attorneys' fees, architect fees, construction consultant
fees, environmental inspection fees, survey fees, and all other out-of-pocket
costs and expenses of every character incurred by Grantor or Beneficiary and/or
Trustee in connection with the preparation of the Loan Instruments, the
evaluation, closing and funding of the loan evidenced by the Loan Instruments,
and any and all amendments and supplements to this Deed of Trust, the Note or
any other Loan Instruments or any approval, consent, waiver, release or other
matter requested or required hereunder or thereunder, or otherwise attributable
or chargeable to Grantor as owner of the Mortgaged Property; and (b) all costs
and expenses, including reasonable attorneys' fees and expenses, incurred or
expended in connection with the exercise of any right or remedy, or the
enforcement of any obligation of Grantor, hereunder or under any other Loan
Instrument.

        6.21 RECORDING AND FILING. Grantor shall cause the Loan Instruments and
all amendments, supplements and extensions thereto and substitutions therefor to
be recorded, filed, rerecorded and refiled in such manner and in such places as
Beneficiary shall reasonably request, and shall pay all such recording, filing,
rerecording and refiling fees, title insurance premiums, and other charges.

        6.22 PAYMENT OF DEBTS. Grantor shall promptly pay when due all
obligations regarding the ownership and operation of the Mortgaged Property
except any such obligations which are being Contested in Good Faith as that term
is defined in the Loan Agreement.

        6.23 MODIFICATION BY SUBSEQUENT OWNERS. Each Grantor agrees that it
shall be bound by any modification of this Deed of Trust or any of the other
Loan Instruments made by Beneficiary and any subsequent owner of the Mortgaged
Property, with or without notice to such Grantor, and no such modifications
shall impair the obligations of such Grantor under this Deed of Trust or any
other Loan Instrument. Nothing in this Section shall be construed as permitting
any transfer of the Mortgaged Property which would constitute an Event of
Default under other provisions of this Deed of Trust.

        6.24 NOTIFICATION OF DEFAULT. Grantor shall notify Beneficiary
immediately if it becomes aware of the occurrence of any Event of Default or any
fact, condition or event that only with the giving of notice or passage of time,
or both, could become an Event of Default, or the failure of Grantor or any
guarantor to observe any of its or his undertakings under any of the Loan
Instruments.

        6.25 BUSINESS PURPOSES. The loan evidenced by the Note is solely for the
purpose of carrying on or acquiring a business of Grantor, and is not for
personal, family household, or agricultural purposes.

<PAGE>

                                   ARTICLE 7

                               HAZARDOUS MATERIALS

        7.1 DEFINITIONS. For the purposes of this Deed of Trust, Grantor,
Beneficiary and Trustee agree that, unless the context otherwise specified or
requires, the following terms shall have the meaning herein specified:

        (a) "HAZARDOUS MATERIALS" shall mean (a) any "hazardous waste" or
"regulated substance" as defined by the Resource Conservation and Recovery Act
of 1976 (42 U.S.C.A. ss. 6901, ET SEQ. (West 1983 & Supp. 1993)), and
regulations promulgated thereunder, both as amended from time to time; (b) any
"hazardous substance" as defined by the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 (42 U.S.C.A. ss. 9601, ET SEQ. (West 1983
& Supp. 1993)) ("CERCLA"), and regulations promulgated thereunder, both as
amended from time to time; (c) any "toxic substance" as defined by the Toxic
Substances Control Act (15 U.S.C.A. ss. 2601, ET SEQ. (West 1983 & Supp. 1993)),
and regulations promulgated thereunder, both as amended from time to time; (d)
any "waste" as defined by the Texas Water Quality Control Act (Tex. Water Code
Ann. ss.ss. 26.01-225 (Vernon 1988)), and regulations promulgated thereunder,
both as amended from time to time; (e) any "solid waste" as defined by the Texas
Solid Waste Disposal Act (Tex. Health & Safety Code Ann. ss. 361.001, ET SEQ.
(Vernon 1992)), and regulations promulgated thereunder, both as amended from
time to time; (f) any "air contaminant " as defined by the Texas Clean Air Act
(Tex. Health & Safety Code Ann., ss. 382.001, ET SEQ. (Vernon 1992)), and
regulations promulgated thereunder, both as amended from time to time; (g) any
"hazardous substance" as defined by the Texas Hazardous Substances Spill
Prevention and Control Act (Tex. Water Code Ann. ss.ss. 26.261-268 (Vernon
1988)), and regulations promulgated thereunder, both as amended from time to
time; (h) any "toxic chemical" as defined by the Texas Toxic Chemical Release
Reporting Act (Tex. Health & Safety Code Ann. ss. 370.001, ET SEQ. (Vernon
1992)), and regulations promulgated thereunder, both as amended from time to
time; (i) any "regulated asbestos-containing material" as defined in the
National Emission Standard for Asbestos (40 C.F.R. ss. 61.140, ET SEQ. (1992));
(j) polychlorinated biphenyls ("PCBS") as defined in 40 C.F.R. Part 761 (1992);
(k) underground storage tanks, whether active, inactive, empty, filled or
partially filled with any substance, (l) any substance the presence of which on
the Mortgaged Property is prohibited by any Governmental Requirements; and (m)
any other substance which by any Governmental Requirements requires special
handling or notification of any federal, state or local governmental entity in
its collection, storage, transportation, treatment, processing, management or
disposal.

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

        (c) "GOVERNMENTAL REQUIREMENTS" shall mean any and all of the following
that may now or hereafter be applicable to Grantor or the Mortgaged Property:
(i) judicial decisions, statutes, rulings, rules, regulations, permits,
certificates or ordinances of any and all governmental or quasi governmental
entities of any nature whatsoever, whether federal, state, county, district,
city or otherwise, and whether now or hereafter in existence ("GOVERNMENTAL
AUTHORITY"); (ii) restrictions of record; and (iii) any other governmental
directive or requirement of any nature.

        7.2 GRANTOR'S WARRANTIES. Grantor hereby represents and warrants that
except as disclosed in (i) the Phase I Environmental Assessment dated May 18,
2004 prepared by Property Solutions, Inc.,

<PAGE>

and (ii) the Asbestos Operations & Maintenance Program dated December 1998
prepared by Law Engineering and Environmental Services, Inc. (Project No.
60300-8-6572-04-606):

        (a) No Hazardous Materials are now located on the Mortgaged Property,
and neither Grantor nor, to Grantor's knowledge, any other person has ever
caused or permitted any Hazardous Materials to be placed, held, located or
disposed of on, under or at the Mortgaged Property or any part thereof;

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

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

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

        (e) Grantor has undertaken all appropriate inquiry into the previous
ownership and uses of the Mortgaged Property consistent with good commercial or
customary practice in an effort to minimize liability associated with Hazardous
Materials or Hazardous Materials Contamination.

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

        7.4 SITE ASSESSMENTS. Beneficiary (by its officers, employees and
agents) at any time and from time to time, either prior to or after the
occurrence of an Event of Default, may contract for the services of persons (the
"SITE REVIEWERS") to perform environmental site assessments ("SITE ASSESSMENTS")
on the Mortgaged Property for the purpose of determining whether there exists on
the Mortgaged Property any environmental condition which could reasonably be
expected to result in any liability, cost or expense to the owner, occupier or
operator of such Mortgaged Property arising under any state, federal or local
law, rule or regulation relating to Hazardous Materials. The Site Assessments
may be performed at any time or times, upon reasonable notice, and under
reasonable conditions established by Grantor which do not impede the performance
of the Site Assessments. The Site Reviewers are hereby authorized to enter upon
the Mortgaged Property for such purposes. The Site Reviewers are further
authorized to perform both above and below the ground testing for environmental
damage or the presence of Hazardous Materials on the Mortgaged Property and such
other tests on the Mortgaged Property as may be necessary to conduct the Site
Assessments in the reasonable opinion of the Site Reviewers.

<PAGE>

Grantor will supply to the Site Reviewers such historical and operational
information regarding the Mortgaged Property as may be reasonably requested by
the Site Reviewers to facilitate the Site Assessments and will make available
for meetings with the Site Reviewers appropriate personnel having knowledge of
such matters. On request, Beneficiary shall make the results of such Site
Assessments fully available to Grantor, which (prior to an Event of Default) may
at its election participate under reasonable procedures in the direction of such
Site Assessments and the description of tasks of the Site Reviewers. The cost of
performing such Site Assessments shall be paid by Grantor upon demand of
Beneficiary and any such obligations shall be Indebtedness secured by this Deed
of Trust. Beneficiary's right to require such Site Assessment shall be for the
sole purpose of protecting Beneficiary's security for the repayment of the
Indebtedness and shall not under any circumstances be construed as granting the
right to participate or constitute participation by the Beneficiary in the
management of the Mortgaged Property or the business conducted thereon.

        7.5 BENEFICIARY'S RIGHT TO REMOVE HAZARDOUS MATERIALS. Beneficiary shall
have the right but not the obligation, prior or subsequent to an Event of
Default, without in any way limiting Beneficiary's other rights and remedies
under this Deed of Trust, to enter onto the Mortgaged Property or to take such
other actions as it deems necessary or advisable to clean up, remove, resolve or
minimize the impact of, or otherwise deal with, any Hazardous Materials or
Hazardous Materials Contamination on the Mortgaged Property following receipt of
any notice from any person or entity asserting the existence of any Hazardous
Materials or Hazardous Materials Contamination pertaining to the Mortgaged
Property or any part thereof which, if true, could result in an order, suit,
imposition of a lien on the Mortgaged Property, or other action and/or which, in
Beneficiary's sole opinion, could jeopardize Beneficiary's security under this
Deed of Trust. All costs and expenses paid or incurred by Beneficiary in the
exercise of any such rights shall be Indebtedness secured by this Deed of Trust
and shall be payable by Grantor upon demand. Beneficiary's right to require such
removal of Hazardous Materials shall be for the sole purpose of protecting
Beneficiary's security for the repayment of the Indebtedness and shall not under
any circumstances be construed as granting the right to participate or
constitute participation in the management of the Mortgaged Property or the
business conducted thereon.

        7.6 SURVIVAL. The provisions of ARTICLE 7 shall survive the release,
foreclosure or other enforcement of this Deed of Trust.

                                   ARTICLE 8

                                EVENTS OF DEFAULT

         The occurrence of any one of the following shall be a default hereunder
("EVENT OF DEFAULT").

        8.1 EVENT OF DEFAULT UNDER LOAN AGREEMENT. The occurrence of an Event of
Default as defined in the Loan Agreement.

        8.2 NONPERFORMANCE OF COVENANTS. (i) (A) Grantor shall default in the
due performance or observance by it of any term, covenant or agreement on its
part to be performed or observed pursuant to SECTION 6.1 hereof beyond any grace
or cure period provided in the other Loan Instruments, or (B) Grantor shall
default in the due performance or observance by it of any term, covenant or
agreement on its part to be performed or observed pursuant to SECTION 6.12 or
SECTION 6.24 hereof (collectively, the "NO CURE PERIOD COVENANTS"), or (ii)
Grantor shall default in the due performance or observance by it of any term,
covenant or agreement on its part to be performed or observed pursuant to any
provision of this Deed of Trust other than the No Cure Period Covenants, and
such default shall continue unremedied for a period of thirty (30) days after:
(a) notice of such default from Beneficiary; or (b) Beneficiary is notified

<PAGE>

of such default or should have been so notified pursuant to the provisions of
SECTION 6.24 hereof, whichever is earlier.

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

        8.4 GRANT OF EASEMENT, ETC. Without the prior written consent of
Beneficiary, Grantor grants any easement or dedication, files any plat,
condominium declaration, or restriction, or otherwise encumbers the Mortgaged
Property, unless such action is expressly permitted by the Loan Instruments or
does not affect the Mortgaged Property.

        8.5 ABANDONMENT. Grantor or the owner of the Mortgaged Property (if
other than Grantor) abandons any of the Mortgaged Property.

        8.6 FORECLOSURE OF OTHER LIENS. The holder of any lien, security
interest or assignment on the Mortgaged Property institutes foreclosure or other
proceedings for the enforcement of its remedies thereunder.

                                   ARTICLE 9

                                    REMEDIES

        9.1 EXERCISE OF SPECIFIC REMEDIES. If an Event of Default shall occur,
Beneficiary may exercise any one or more of the following remedies, without
notice (unless notice is required by applicable statute):

        (a) ACCELERATION. Upon the occurrence of an Event of Default described
in Section 11.6 of the Loan Agreement, the entire principal of and accrued
interest of the Indebtedness shall forthwith be due and payable without demand,
presentment for payment, notice of nonpayment, protest, notice of protest,
notice of intent to accelerate, notice of acceleration and all other notices of
further actions of any kind, all of which are hereby expressly waived by
Grantor. In the event that any other Event of Default shall occur and be
continuing, Beneficiary may declare the Indebtedness immediately due and
payable, whereupon all of the Indebtedness shall be forthwith due and payable
without demand, presentment for payment, notice of nonpayment, protest, notice
of protest, notice of intent to accelerate, notice of acceleration and all other
notices or further actions of any kind, all of which are hereby expressly waived
by Grantor. Grantor hereby waives notice of intent to accelerate and notice of
acceleration.

        (b) ENFORCEMENT OF ASSIGNMENT OF RENTS AND LEASES. Prior or subsequent
to taking possession of any portion of the Mortgaged Property or taking any
action with respect to such possession, Beneficiary may:

<PAGE>

                (i) collect and/or sue for the Rents in Beneficiary's own name,
        give receipts and releases therefor, and after deducting all expenses of
        collection, including attorneys' fees and expenses, apply the net
        proceeds thereof to any Indebtedness as Beneficiary may elect;

                (ii) make, modify, enforce, cancel, terminate or accept
        surrender of any Leases, evict tenants, adjust the Rents, maintain,
        decorate, refurbish, repair, clean, and make space ready for renting,
        and otherwise do anything Beneficiary deems advisable in connection with
        the Mortgaged Property;

                (iii) apply the Rents so collected to the operation and
        management of the Mortgaged Property, including the payment of
        management, brokerage and attorneys' fees and expenses, and/or to the
        Indebtedness; and

                (iv) require Grantor to transfer all security deposits and
        records thereof to Beneficiary together with all original counterparts
        of the Leases.

        (c) FORECLOSURE. Beneficiary may require the Trustee to sell all or part
of the Mortgaged Property, at public auction, to the highest bidder, for cash,
at the county courthouse of the county in Texas in which the Mortgaged Property
or any part thereof is situated, or if the Mortgaged Property is located in more
than one county such sale may be made at the courthouse in any county in which
the Mortgaged Property is situated. The sale shall take place at such area of
the courthouse as shall be properly designated from time to time by the
commissioners court (or, if not so designated by the commissioners court, at
such other area in the courthouse as may be provided in the notice of sale
hereinafter described) of the specified county, between the hours of 10:00
o'clock a.m. and 4:00 o'clock p.m. (the commencement of such sale to occur
within three hours following the time designated in the hereinafter described
notice of sale as the earliest time at which such sale shall occur, if required
by applicable law) on the first Tuesday of any month, after giving notice of the
time, place and terms of said sale (including the earliest time at which such
sale shall occur) and of the property to be sold in the manner hereinafter
described. Notice of a sale of all or part of the Mortgaged Property by the
Trustee shall be given by posting written notice thereof at the courthouse door
(or other area in the courthouse as may be designated for such public notices)
of the county in which the sale is to be made, and by filing a copy of the
notice in the office of the county clerk of the county in which the sale is to
be made, at least twenty-one (21) days preceding the date of the sale, and if
the property to be sold is in more than one county a notice shall be posted at
the courthouse door (or other area in the courthouse as may be designated for
such public notices) and filed with the county clerk of each county in which the
property to be sold is situated. In addition, Beneficiary shall, at least
twenty-one (21) days preceding the date of sale, serve written notice of the
proposed sale by certified mail on Grantor and each debtor obligated to pay the
Indebtedness secured hereby according to the records of Beneficiary. Service of
such notice shall be completed upon deposit of the notice, enclosed in a
postpaid wrapper, properly addressed to such debtor at the most recent address
as shown by the records of Beneficiary, in a post office or official depository
under the care and custody of the United States Postal Service. The affidavit of
any person having knowledge of the facts to the effect that such service was
completed shall be prima facie evidence of the fact of service. Any notice that
is required or permitted to be given to Grantor may be addressed to Grantor at
Grantor's address as stated above. Any notice that is to be given by certified
mail to any other debtor may, if no address for such other debtor is shown by
the records of Beneficiary, be addressed to such other debtor at the address of
Grantor as is shown by the records of Beneficiary. Notwithstanding the foregoing
provisions of this paragraph, notice of such sale given in accordance with the
requirements of the applicable laws of the State of Texas in effect at the time
of such sale shall constitute sufficient notice of such sale. Trustee may sell
all or any portion of the Mortgaged Property, together or in lots or parcels,
and may execute and deliver to the purchaser or purchasers of such property good
and sufficient deeds of conveyance of fee simple title with covenants of general
warranty made on behalf of Grantor. In no event shall Trustee be

<PAGE>

required to exhibit, present or display at any such sale any of the personalty
described herein to be sold at such sale. Trustee making such sale shall receive
the proceeds thereof and shall apply the same as follows: (i) first, he shall
pay the reasonable expenses of Trustee and a reasonable Trustee's fee or
commission; (ii) second, he shall pay, so far as may be possible, the
Indebtedness, discharging first that portion of the Indebtedness arising under
the covenants or agreements herein contained and not evidenced by the Note;
(iii) third, he shall pay the residue, if any, to the persons legally entitled
thereto. Payment of the purchase price to Trustee shall satisfy the obligation
of the purchaser at such sale therefor, and such purchaser shall not be
responsible for the application thereof. The sale or sales by Trustee of less
than the whole of the Mortgaged Property shall not exhaust the power of sale
herein granted, and Trustee is specifically empowered to make successive sale or
sales under such power until the whole of the Mortgaged Property shall be sold;
and if the proceeds of such sale or sales of less than the whole of the
Mortgaged Property shall be less than the aggregate of the Indebtedness and the
expenses thereof, this Deed of Trust and the lien, security interest and
assignment hereof shall remain in full force and effect as to the unsold portion
of the Mortgaged Property just as though no sale or sales had been made;
provided, however, that Grantor shall never have any right to require the sale
or sales of less than the whole of the Mortgaged Property, but Beneficiary shall
have the right, at its sole election, to request Trustee to sell less than the
whole of the Mortgaged Property. If default is made hereunder, the holder of the
Indebtedness or any part thereof on which the payment is delinquent shall have
the option to proceed with foreclosure in satisfaction of such item either
through judicial proceedings or by directing Trustee to proceed as if under a
full foreclosure, conducting the sale as herein provided without declaring the
entire Indebtedness due, and if sale is made because of default of an
installment, or a part of an installment, such sale may be made subject to the
unmatured part of the Indebtedness; and it is agreed that such sale, if so made,
shall not in any manner affect the unmatured part of the Indebtedness, but as to
such unmatured part this Deed of Trust shall remain in full force and effect as
though no sale had been made under the provisions of this paragraph. Several
sales may be made hereunder without exhausting the right of sale for any
unmatured part of the Indebtedness. At any such sale (1) Grantor hereby agrees,
in its behalf and in behalf of its heirs, executors, administrators, successors,
personal representatives and assigns, that any and all recitals made in any deed
of conveyance given by Trustee with respect to the identity of Beneficiary, the
occurrence or existence of any default, the acceleration of the maturity of any
of the Indebtedness, the request to sell, the notice of sale, the giving of
notice to all debtors legally entitled thereto, the time, place, terms, and
manner of sale, and receipt, distribution and application of the money realized
therefrom, or the due and proper appointment of a substitute Trustee, and,
without being limited by the foregoing, with respect to any other act or thing
having been duly done by Beneficiary or by Trustee hereunder, shall be taken by
all courts of law and equity as prima facie evidence that the statements or
recitals state facts and are without further question to be so accepted, and
Grantor hereby ratifies and confirms every act that Trustee or any substitute
Trustee hereunder may lawfully do in the premises by virtue hereof, and (2) the
purchaser may disaffirm any easement granted, or rental, lease or other contract
made in violation of any provision of this Deed of Trust, and may take immediate
possession of the Mortgaged Property free from, and despite the terms of, such
grant of easement and rental or lease contract. Beneficiary may bid and become
the purchaser of all or any part of the Mortgaged Property at any trustee's or
foreclosure sale hereunder, and the amount of Beneficiary's successful bid may
be credited on the Indebtedness.

        (d) UNIFORM COMMERCIAL CODE. Without limitation of Beneficiary's rights
of enforcement with respect to the Collateral or any part thereof in accordance
with the procedures for foreclosure of real estate, Beneficiary may exercise its
rights of enforcement with respect to the Collateral or any part thereof under
the Code as amended (or under the Uniform Commercial Code in force in any other
state to the extent the same is applicable law) and in conjunction with, in
addition to or in substitution for those rights and remedies: (1) Beneficiary
may enter upon Grantor's premises to take possession of, assemble and collect
the Collateral or, to the extent and for those items of the Collateral permitted
under applicable law, to render it unusable; (2) Beneficiary may require Grantor
to assemble the Collateral and make it available at a place Beneficiary
designates which is mutually convenient to allow Beneficiary to take

<PAGE>

possession or dispose of the Collateral; (3) written notice mailed to Grantor as
provided herein at least ten (10) days prior to the date of public sale of the
Collateral or prior to the date after which private sale of the Collateral will
be made shall constitute reasonable notice; (4) any sale made pursuant to the
provisions of this paragraph shall be deemed to have been a public sale
conducted in a commercially reasonable manner if held contemporaneously with and
upon the same notice as required for the sale of the Mortgaged Property under
power of sale as provided in paragraph (c) above in this SECTION 9.1; (5) in the
event of a foreclosure sale, whether made by Trustee under the terms hereof, or
under judgment of a court, the Collateral and the other Mortgaged Property may,
at the option of Beneficiary, be sold as a whole; (6) it shall not be necessary
that Beneficiary take possession of the Collateral or any part thereof prior to
the time that any sale pursuant to the provisions of this Section is conducted
and it shall not be necessary that the Collateral or any part thereof be present
at the location of such sale; (7) with respect to application of proceeds of
disposition of the Collateral, the costs and expenses incident to disposition
shall include the reasonable expenses of retaking, holding, preparing for sale
or lease, selling, leasing and the like and the reasonable attorneys' fees and
legal expenses incurred by Beneficiary; (8) any and all statements of fact or
other recitals made in any bill of sale or assignment or other instrument
evidencing any foreclosure sale hereunder as to nonpayment of the Indebtedness
or as to the occurrence of any default, or as to Beneficiary having declared all
of such indebtedness to be due and payable, or as to notice of time, place and
terms of sale and of the properties to be sold having been duly given, or as to
any other act or thing having been duly done by Beneficiary, shall be taken as
prima facie evidence of the truth of the facts so stated and recited; and (9)
Beneficiary may appoint or delegate any one or more persons as agent to perform
any act or acts necessary or incident to any sale held by Beneficiary, including
the sending of notices and the conduct of the sale, but in the name and on
behalf of Beneficiary.

        (e) LAWSUITS. Beneficiary may proceed by a suit or suits in equity or at
law, whether for the specific performance of any covenant or agreement herein
contained or in aid of the execution of any power herein granted, or for any
foreclosure hereunder or for the sale of the Mortgaged Property under the
judgment or decree of any court or courts of competent jurisdiction.

        (f) ENTRY ON MORTGAGED PROPERTY. Upon occurrence of an Event of Default
hereunder, Beneficiary may enter into and upon and take possession of all or any
part of the Mortgaged Property, and may exclude Grantor, and all persons
claiming under Grantor, and its or their agents or servants, wholly or partly
therefrom; and, holding the same, Beneficiary may use, administer, manage,
operate, and control the Mortgaged Property and may exercise all rights and
powers of Grantor in the name, place and stead of Grantor, or otherwise, as the
Beneficiary shall deem best; and in the exercise of any of the foregoing rights
and powers Beneficiary shall not be liable to Grantor for any loss or damage
thereby sustained unless due solely to the willful misconduct or gross
negligence of Beneficiary.

        (g) TRUSTEE OR RECEIVER. Beneficiary may make application to a court of
competent jurisdiction, as a matter of strict right and without notice to
Grantor or regard to the adequacy of the Mortgaged Property for the repayment of
the Indebtedness, for appointment of a receiver of the Mortgaged Property, and
Grantor does hereby irrevocably consent to such appointment. Any such receiver
shall have all the usual powers and duties of receivers in similar cases,
including the full power to rent, maintain and otherwise operate the Mortgaged
Property upon such terms as may be approved by the court, and shall apply the
Rents in accordance with the provisions of SECTION 4.1.

        (h) TERMINATION OF COMMITMENT TO LEND. Beneficiary may terminate any
commitment or obligation to lend or disburse funds under any Loan Instrument.

        9.2 TENANCY AT WILL. In the event of a trustee's sale hereunder and if
at the time of such sale Grantor or any other party occupies the portion of the
Mortgaged Property so sold or any part thereof, such occupant shall immediately
become the tenant of the purchaser at such sale, which tenancy shall be a

<PAGE>

tenancy from day to day, terminable at the will of either tenant or landlord, at
a reasonable rental per day based upon the value of the portion of the Mortgaged
Property so occupied, such rental to be due and payable daily to the purchaser.
An action of forcible detainer shall lie if the tenant holds over after a demand
in writing for possession of such Mortgaged Property.

        9.3 SUBSTITUTE TRUSTEE. If, for any reason, Beneficiary prefers to
appoint a substitute Trustee hereunder, Beneficiary may, from time to time, by
written instrument, appoint one or more substitute Trustees, who shall succeed
to all the estate, rights, powers, and duties of the original Trustee named
herein. Such appointment may be executed by anyone acting in a representative
capacity, and such appointment shall be conclusively presumed to have been
executed with appropriate authority.

        9.4 INDEMNIFICATION OF TRUSTEE. Except for gross negligence or willful
misconduct, Trustee shall not be liable for any act or omission or error of
judgment. Trustee may rely on any document believed by him in good faith to be
genuine. All money received by Trustee shall, until used or applied as herein
provided, be held in trust, but need not be segregated (except to the extent
required by law), and Trustee shall not be liable for interest thereon. Grantor
hereby indemnifies Trustee against all liability and expenses that he may incur
in the performance of his duties hereunder. WITHOUT LIMITATION, THE FOREGOING
INDEMNITY SHALL APPLY WITH RESPECT TO MATTERS WHICH IN WHOLE OR IN PART ARE
CAUSED BY OR ARISE OUT OF, OR ARE CLAIMED TO BE CAUSED BY OR ARISE OUT OF, THE
NEGLIGENCE OR STRICT LIABILITY OF TRUSTEE. HOWEVER, SUCH INDEMNITY SHALL NOT
APPLY TO THE EXTENT THAT THE SUBJECT OF THE INDEMNIFICATION IS CAUSED BY OR
ARISES OUT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF TRUSTEE.

        9.5 BENEFICIARY'S RIGHT TO PERFORM. Upon Grantor's failure to make a
payment or perform an act required by the Loan Instruments, then at any time
thereafter, and without notice to or demand upon Grantor and without waiving or
releasing any other right, remedy or recourse, Beneficiary may (but shall not be
obligated to) make such payment or perform such act for the account of and at
the expense of Grantor, and shall have the right to enter upon the Mortgaged
Property for such purpose and to take all such action as it may deem necessary
or appropriate.

        9.6 REIMBURSEMENT OF EXPENDITURE. If Beneficiary shall expend any money
chargeable to Grantor or subject to reimbursement by Grantor under the terms of
the Loan Instruments, Grantor shall repay the same to Beneficiary immediately at
the place where the Note is payable, together with interest thereon at the
Default Rate, as defined in the Loan Agreement, from and after the date of each
such expenditure by Beneficiary until paid by Grantor.

        9.7 OTHER RIGHTS. Beneficiary may exercise any and all other rights,
remedies and recourses granted under the Loan Instruments now or hereafter
existing in equity or at law for the protection and preservation of the
Mortgaged Property.

        9.8 REMEDIES CUMULATIVE, CONCURRENT AND NONEXCLUSIVE. Beneficiary shall
have all rights, remedies and recourses granted in the Loan Instruments and
available at law or equity (including, without limitation, those granted by the
Code and applicable to the Mortgaged Property, or any portion thereof), and same
(a) shall be cumulative and concurrent, (b) may be pursued separately,
successively or concurrently against Grantor or others obligated for the
Indebtedness, or any part thereof or against any one or more of them, or against
the Mortgaged Property, at the sole discretion of Beneficiary, (c) may be
exercised as often as occasion therefor shall arise, it being agreed by Grantor
that the exercise of or failure to exercise any of same shall in no event be
construed as a waiver or release thereof or of any other right, remedy or
recourse, and (d) are intended to be, and shall be, nonexclusive.

<PAGE>

        9.9 RIGHTS AND REMEDIES OF SURETIES. Grantor waives any right or remedy
which Grantor may have or be able to assert pursuant to Chapter 34 of the
Business and Commerce Code of the State of Texas pertaining to the rights and
remedies of sureties.

                                   ARTICLE 10

                                  MISCELLANEOUS

        10.1 COLLECTION. If the Indebtedness shall be collected by legal
proceedings, whether through a probate or bankruptcy court or otherwise, or
shall be placed in the hands of an attorney for collection after an Event of
Default or maturity, Grantor agrees to pay the attorneys' and collection fees
and expenses as set forth in the Note, and such fees and expenses shall be a
part of the Indebtedness.

        10.2 CHANGE IN OWNERSHIP. If the ownership (legal or beneficial) of the
Mortgaged Property or any part thereof becomes vested in a person other than
Grantor, or in the event of a change of any ownership of Grantor (legal or
beneficial), Beneficiary may, without notice to Grantor, deal with such
successor or successors in interest with reference to this Deed of Trust and to
the Indebtedness in the same manner as with Grantor without in any way vitiating
or discharging Grantor's liability hereunder or upon the Indebtedness. No sale
of the Mortgaged Property, and no forbearance on the part of Beneficiary, and no
extension of the time for the payment of the Indebtedness, shall operate to
release or affect the original liability of Grantor.

        10.3 RELEASE OF LIEN. If Grantor shall perform each of the covenants and
agreements herein contained, then this conveyance shall become null and void and
shall be released at Grantor's written request and expense; otherwise, it shall
remain in full force and effect. No release or modification of this conveyance,
or of the lien, security interest or assignment created and evidenced hereby,
shall be valid unless executed by Beneficiary.

        10.4 PARTIAL RELEASE OF LIEN, EXTENSION, ETC. Any part of the Mortgaged
Property may be released by Beneficiary without affecting the lien, security
interest and assignment hereof against the remainder. The lien, security
interest and other rights granted hereby shall not affect or be affected by any
other security taken for the Indebtedness. The taking of additional security, or
the extension or renewal of the Indebtedness or any part thereof, shall not
release or impair the lien, security interest and other rights granted hereby,
or affect the liability of any endorser or guarantor or improve the right of any
permitted junior lienholder; and this Deed of Trust, as well as any instrument
given to secure any renewal or extension of the Indebtedness, or any part
thereof, shall be and remain a first and prior lien, except as otherwise
provided herein, on all of the Mortgaged Property not expressly released until
the Indebtedness is paid.

        10.5 NO IMPAIRMENT OF SECURITY. The lien, security interest and other
security rights of Beneficiary hereunder or under any other Loan Instrument
shall not be impaired by any indulgence, moratorium or release granted by
Beneficiary including, but not limited to, any renewal, extension or
modification which Beneficiary may grant with respect to any Indebtedness, or
any surrender, compromise, release, renewal, extension, exchange or substitution
which Beneficiary may grant in respect of the Mortgaged Property, or any part
thereof or any interest therein, or any release or indulgence granted to any
endorser, guarantor or surety of any Indebtedness. The taking of additional
security by Beneficiary shall not release or impair the lien, security interest
or other security rights of Beneficiary hereunder or affect the liability of
Grantor or of any endorser, guarantor or surety, or improve the right of any
junior lienholder in the Mortgaged Property (without implying hereby
Beneficiary's consent to any junior lien).

<PAGE>

        10.6 ACTS NOT CONSTITUTING WAIVER BY BENEFICIARY. Beneficiary may waive
any default without waiving any other prior or subsequent default. Beneficiary
may remedy any default without waiving the default remedied. Neither failure by
Beneficiary to exercise, nor delay by Beneficiary in exercising, nor
discontinuance of the exercise of any right, power or remedy (including but not
limited to the right to accelerate the maturity of the Indebtedness or any part
thereof) upon or after any default shall be construed as a waiver of such
default or as a waiver of the right to exercise any such right, power or remedy
at a later date. No single or partial exercise by Beneficiary of any right,
power or remedy hereunder shall exhaust the same or shall preclude any other or
further exercise thereof, and every such right, power or remedy hereunder may be
exercised at any time and from time to time. No modification or waiver of any
provision hereof nor consent to any departure by Grantor therefrom shall in any
event be effective unless the same shall be in writing and signed by Beneficiary
and then such waiver or consent shall be effective only in the specific
instance, for the purpose for which given and to the extent therein specified.
No notice to nor demand on Grantor in any case shall of itself entitle Grantor
to any other or further notice or demand in similar or other circumstances.
Remittances in payment of any part of the of the Indebtedness other than in the
required amount in immediately available U.S. funds shall not, regardless of any
receipt or credit issued therefor, constitute payment until the required amount
is actually received by Beneficiary in immediately available U.S. funds and
shall be made and accepted subject to the condition that any check or draft may
be handled for collection in accordance with the practice of the collecting bank
or banks. Acceptance by Beneficiary of any payment in an amount less than the
amount then due on any of the Indebtedness shall be deemed an acceptance on
account only and shall not in any way excuse the existence of a default
hereunder.

        10.7 WAIVER OF MARSHALLING AND CERTAIN RIGHTS. To the extent that
Grantor may lawfully do so, Grantor hereby expressly waives any right pertaining
to the marshalling of assets, the exemption of homestead, the administration of
estates of decedents, or other matter to defeat, reduce or affect the right of
Beneficiary to sell the Mortgaged Property for the collection of the
Indebtedness (without any prior or different resort for collection), or the
right of Beneficiary to the payment of the Indebtedness out of the proceeds of
sale of the Mortgaged Property in preference to every other person and claimant.

        10.8 SUBROGATION. To the extent that proceeds of the Indebtedness are
used to pay any outstanding lien, charge or encumbrance affecting the Mortgaged
Property, such proceeds have been advanced by Beneficiary at Grantor's request,
and Beneficiary shall be subrogated to all rights, interests and liens owned or
held by any owner or holder of such outstanding liens, charges and encumbrances,
irrespective of whether such liens, charges or encumbrances are released of
record; provided, however, that the terms and provisions hereof shall govern the
rights and remedies of Beneficiary and shall supersede the terms, provisions,
rights, and remedies under the lien or liens to which Beneficiary is subrogated
hereunder.

        10.9 NO WAIVER. No waiver of any Event of Default or any other default
on the part of Grantor or breach of any of the provisions of this Deed of Trust
or of any other instrument executed in connection with the Indebtedness shall be
considered a waiver of any other or subsequent default or breach, and no delay
or omission in exercising or enforcing the rights and powers herein granted
shall be construed as a waiver of such rights and powers, and likewise no
exercise or enforcement of any rights or powers hereunder shall be held to
exhaust such rights and powers, and every such right and power may be exercised
from time to time. Acceptance by Beneficiary of partial payments shall not
constitute a waiver of the default by failure to make full payments.

        10.10 LIMITATION ON INTEREST. All agreements between Grantor and
Beneficiary, whether now existing or hereafter arising and whether written or
oral, are hereby limited so that in no contingency, whether by reason of
acceleration of the maturity of any of the Indebtedness or otherwise, shall the
interest contracted for, charged or received by Beneficiary exceed the maximum
amount permissible

<PAGE>

under applicable law. If from any circumstance whatsoever, interest would
otherwise be payable to Beneficiary in excess of the maximum lawful amount, the
interest payable to Beneficiary shall be reduced to the maximum amount permitted
under applicable law; and if from any circumstance Beneficiary shall ever
receive anything of value deemed interest by applicable law in excess of the
maximum lawful amount, an amount equal to any excessive interest shall be
applied to the reduction of the principal balance of the Indebtedness and not to
the payment of interest or, if such excessive interest exceeds the unpaid
balance of principal of the Indebtedness, such excess shall be refunded to
Grantor. All interest paid or agreed to be paid to Beneficiary shall, to the
extent permitted by applicable law, be amortized, prorated, allocated, and
spread throughout the full period until payment in full of the principal of the
Indebtedness (including the period of any renewal or extension thereof) so that
the interest thereon for such full period shall not exceed the maximum amount
permitted by applicable law. This paragraph shall control all agreements between
Grantor and Beneficiary.

        10.11 SUCCESSORS AND ASSIGNS; USE OF TERMS. The covenants herein
contained shall bind, and the benefits and advantages shall inure to, the
respective heirs, executors, administrators, personal representatives,
successors, and assigns of the parties hereto. Whenever used, the singular
number shall include the plural and the plural the singular, and the use of any
gender shall be applicable to all genders. The term "GRANTOR" shall include in
their individual capacities and jointly all parties hereinabove named a Grantor.
The term "BENEFICIARY" shall include any lawful owner, holder, pledgee, or
assignee of any of the Indebtedness. The duties, covenants, conditions,
obligations, and warranties of Grantor in this Deed of Trust shall be joint and
several obligations of Grantor and each Grantor, if more than one, and each
Grantor's heirs, executors, administrators, personal representatives, successors
and assigns. Each party who executes this Deed of Trust and each subsequent
owner of the Mortgaged Property, or any part thereof (other than Beneficiary),
covenants and agrees that it will perform, or cause to be performed, each term
and covenant of this Deed of Trust.

        10.12 BENEFICIARY'S CONSENT. In any instance hereunder where
Beneficiary's approval or consent is required or the exercise of Beneficiary's
judgment is required, the granting or denial of such approval or consent and the
exercise of such judgment shall be within the sole discretion of Beneficiary
free from any limitation or requirement of reasonableness, and Beneficiary shall
not, for any reason or to any extent, be required to grant such approval or
consent or exercise such judgment in any particular manner regardless of the
reasonableness of either the request or Beneficiary's judgment.

        10.13 SEVERABILITY. If any provision of this Deed of Trust is held to be
illegal, invalid, or unenforceable under present or future laws effective while
this Deed of Trust is in effect, the legality, validity and enforceability of
the remaining provisions of this Deed of Trust shall not be affected thereby,
and in lieu of each such illegal, invalid or unenforceable provision there shall
be added automatically as a part of this Deed of Trust a provision that is
legal, valid and enforceable and as similar in terms to such illegal, invalid or
unenforceable provision as may be possible.

        10.14 NO PARTNERSHIP. Nothing contained in the Loan Instruments is
intended to create any partnership, joint venture or association between Grantor
and Beneficiary, or in any way make Beneficiary a co-principal with Grantor with
reference to the Mortgaged Property, and any inferences to the contrary are
hereby expressly negated.

        10.15 HEADINGS. The article, paragraph and subparagraph headings hereof
are inserted for convenience of reference only and shall not alter, define, or
be used in construing the text of such articles, paragraphs or subparagraphs.

<PAGE>

        10.16 CONSTRUCTION DEED OF TRUST. This Deed of Trust constitutes a
"construction mortgage" as defined in Section 9.334(h) of the Code to the extent
that it secures an obligation incurred for the construction of the Improvements,
including the acquisition cost of the Land.

        10.17 APPLICABLE TO PRIOR LIENS. If this Deed of Trust is or becomes
subordinate to any other liens, security interests, assignments of leases or
rents or any other encumbrances (collectively, the "PRIOR LIENS") affecting any
of the Mortgaged Property (all documents creating the Prior Liens and evidencing
and governing the indebtedness secured thereby being collectively called the
"PRIOR LIEN DOCUMENTS"), in addition to the provisions of SECTION 6.12, the
provisions of this SECTION 10.17 shall apply. Grantor shall not enter into any
renewal, extension, modification, increase or refinancing of any of the Prior
Lien Documents or the indebtedness secured thereby without the prior written
consent of Beneficiary. Grantor shall pay when due all indebtedness evidenced
and secured by the Prior Lien Documents and shall timely perform all other
obligations of the Grantor under the Prior Lien Documents. Beneficiary may, but
shall not be obligated to, pay any such indebtedness or perform any such
obligations for the account of Grantor, and any sum so expended shall be part of
the Indebtedness secured hereby. Grantor shall pay to Beneficiary all amounts so
expended by Beneficiary with interest on such amounts from the date expended at
the rate set forth in the Note, but not in excess of the highest rate permitted
by applicable law. Any default under any of the Prior Lien Documents shall
constitute an Event of Default hereunder. If Beneficiary should cure any such
default under any of the Prior Lien Documents, the curing thereof by Beneficiary
shall not constitute a cure of the default under this Deed of Trust. Grantor
shall send to Beneficiary a copy of each notice of default or notice of
acceleration or other notice received by Grantor from the holder of any of the
Prior Lien Documents within one (1) business day after receipt thereof by
Grantor. Notwithstanding the foregoing, Beneficiary does not consent to any
Prior Lien unless otherwise expressly permitted in this Deed of Trust.

        10.18 ABSENCE OF OBLIGATIONS OF BENEFICIARY WITH RESPECT TO MORTGAGED
PROPERTY. Notwithstanding anything in this Deed of Trust to the contrary,
including, without limitation, the definition of "MORTGAGED PROPERTY" and/or the
provisions of ARTICLE 4 hereof, (a) to the extent permitted by applicable law,
the Mortgaged Property is comprised of Grantor's rights, title and interests
therein but not its obligations, duties or liabilities pertaining thereto, (b)
Beneficiary neither assumes nor shall have any obligations, duties or
liabilities in connection with any portion of the items described in connection
with the definition of "MORTGAGED PROPERTY" herein, either prior to or after
obtaining title to such Mortgaged Property, whether by foreclosure sale, the
granting of a deed in lieu of foreclosure or otherwise, and (c) Beneficiary may,
at any time prior to or after the acquisition of title to any portion of the
Mortgaged Property as above described, advise any party in writing as to the
extent of Beneficiary's interest therein and/or expressly disaffirm in writing
any rights, interests, obligations, duties and/or liabilities with respect to
such Mortgaged Property or matters related thereto. Without limiting the
generality of the foregoing, it is understood and agreed that Beneficiary shall
have no obligations, duties or liabilities prior to or after acquisition of
title to any portion of the Mortgaged Property, as lessee under any lease or
purchaser or seller under any contract or option unless Beneficiary elects
otherwise by written notification.

        10.19 NOTICES. Except as otherwise provided in subparagraph (c) of
SECTION 9.1, all notices demands, requests, approvals and other communications
required or permitted hereunder shall be given as provided in the Loan
Agreement.

        10.20 APPLICATION OF PAYMENTS TO CERTAIN INDEBTEDNESS. If any part of
the Indebtedness cannot be lawfully secured by this Deed of Trust or if any part
of the Mortgaged Property cannot be lawfully subject to the lien and security
interest hereof to the full extent of such Indebtedness, then all payments made
shall be applied on the Indebtedness first in discharge of that portion thereof
which is not secured by this Deed of Trust.

<PAGE>

        10.21 GENDER; TITLES; CONSTRUCTION. Within this Deed of Trust, words of
any gender shall be held and construed to include any other gender, and words in
the singular number shall be held and construed to include the plural, unless
the context otherwise requires. Titles appearing at the beginning of any
subdivisions hereof are for convenience only, do not constitute any part of such
subdivisions, and shall be disregarded in construing the language contained in
such subdivisions. The use of the words "herein," "hereof, " "hereunder" and
other similar compounds of the word "here" shall refer to this entire Deed of
Trust and not to any particular Article, Section, paragraph or provision. The
term "person" and words importing persons as used in this Deed of Trust shall
include firms, associations, partnerships (including limited partnerships),
joint ventures, trusts, corporations and other legal entities, including public
or governmental bodies, agencies or instrumentalities, as well as natural
persons.

        10.22 REPORTING COMPLIANCE. Grantor agrees to comply with any and all
reporting requirements applicable to the transaction evidenced by the Note and
secured by this Deed of Trust which are set forth in any law, statute,
ordinance, rule, regulation, order or determination of any governmental
authority, including but not limited to The International Investment Survey Act
of 1976, The Agricultural Foreign Investment Disclosure Act of 1978, The Foreign
Investment in Real Property Tax Act of 1980 and the Tax Reform Act of 1984 and
further agrees upon request of Beneficiary to furnish Beneficiary with evidence
of such compliance.

        10.23 GRANTOR. Unless the context clearly indicates otherwise, as used
in this Deed of Trust, "GRANTOR" means the grantors named in ARTICLE 1 hereof or
any of them. The obligations of Grantor hereunder shall be joint and several. If
any Grantor, or any signatory who signs on behalf of any Grantor, is a
corporation, partnership or other legal entity, Grantor and any such signatory,
and the person or persons signing for it, represent and warrant to Beneficiary
that this instrument is executed, acknowledged and delivered by Grantor's duly
authorized representatives. If Grantor is an individual, no power of attorney
granted by Grantor herein shall terminate on Grantor's disability.

        10.24 EXECUTION. This Deed of Trust has been executed in several
counterparts, all of which are identical, and all of which counterparts together
shall constitute one and the same instrument. The date or dates reflected in the
acknowledgments hereto indicate the date or dates of actual execution of this
Deed of Trust, but such execution is as of the date shown on the first page
hereof, and for purposes of identification and reference the date of this Deed
of Trust shall be deemed to be the date reflected on the first page hereof.
Grantor will cause this Deed of Trust and all amendments and supplements thereto
and substitutions therefor and all financing statements and continuation
statements relating thereto to be recorded, filed, re-recorded and refiled in
such manner and in such places as Trustee or Beneficiary shall reasonably
request and will pay all such recording, filing, re-recording and refiling
taxes, fees and other charges.

        10.25 MODIFICATION OR TERMINATION. The Loan Instruments may only be
modified or terminated by a written instrument or instruments intended for that
purpose and executed by the party against which enforcement of the modification
or termination is asserted. Any alleged modification or termination which is not
so documented shall not be effective as to any party.

        10.26 APPLICABLE LAW. THIS DEED OF TRUST, AND ITS VALIDITY, ENFORCEMENT
AND INTERPRETATION, SHALL BE GOVERNED BY TEXAS LAW (WITHOUT REGARD TO ANY
CONFLICT OF LAWS PRINCIPLES) AND APPLICABLE UNITED STATES FEDERAL LAW.

        10.27 WAIVER OF JURY TRIAL. GRANTOR AND BENEFICIARY IRREVOCABLY WAIVE
ANY AND ALL RIGHT EITHER OF THEM MAY HAVE TO A TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR CLAIM OF ANY NATURE RELATING TO THIS DEED OF TRUST, OR ANY
DOCUMENTS EXECUTED IN CONNECTION WITH THIS DEED OF

<PAGE>

TRUST, OR ANY TRANSACTIONS CONTEMPLATED IN ANY SUCH DOCUMENTS. GRANTOR AND
BENEFICIARY ACKNOWLEDGE THAT THE FOREGOING WAIVER IS KNOWING AND VOLUNTARY.
Grantor acknowledges that it has read and understands all of the provisions of
this Deed of Trust, including the waiver of jury trial, and has been advised by
counsel as necessary or appropriate.

        10.28 ENTIRE AGREEMENT. The Loan Instruments constitute the entire
understanding and agreement between Grantor and Beneficiary with respect to the
transactions arising in connection with the Indebtedness and supersede all prior
written or oral understandings and agreements between Grantor and Beneficiary
with respect to the matters addressed in the Loan Instruments. Grantor hereby
acknowledges that, except as incorporated in writing in the Loan Instruments,
there are not, and were not, and no persons are or were authorized by
Beneficiary to make, any representations, understandings, stipulations,
agreements or promises, oral or written, with respect to the matters addressed
in the Loan Instruments.

         THE WRITTEN LOAN DOCUMENTS REPRESENT 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.

         EXECUTED on the date(s) of the acknowledgment(s) below, to be effective
as of the date first set forth above.

                                         BEHRINGER HARVARD QUORUM I LP

                                         By:  Behringer Harvard Quorum I GP, LLC
                                              Its General Partner

                                              By:   /s/ Gerald J. Reihsen, III
                                                 -------------------------------
                                                  Gerald J. Reihsen, III
                                                  Secretary

STATE OF TEXAS    ss.
                  ss.
COUNTY OF DALLAS  ss.

This instrument was acknowledged before me on July __, 2004, by Gerald J.
Reihsen, III, Secretary of Behringer Harvard Quorum I GP, LLC, a Texas limited
liability company, acting in its capacity as general partner of Behringer
Harvard Quorum I LP, a Texas limited partnership on behalf of said limited
partnership.

                                                   _____________________________
                                                   Notary Public, State of Texas

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