Document:

EX-10.6

 Exhibit 10.6 

FORM OF 
 HOWARD
MIDSTREAM PARTNERS, LP 
 2017 LONG-TERM INCENTIVE PLAN 

PHANTOM UNIT AGREEMENT 

Pursuant to this Phantom Unit Agreement, dated as of the Grant Date set forth in the Grant Notice below (this “Agreement”),
Howard Midstream GP, LLC (the “Company”), as the general partner of Howard Midstream Partners, LP (the “Partnership”), hereby grants to the individual identified in the Grant Notice below (the
“Participant”) the following award of Phantom Units (“Phantom Units”), pursuant and subject to the terms and conditions of this Agreement and the Howard Midstream Partners, LP 2017 Long-Term Incentive Plan (the
“Plan”), the terms and conditions of which are hereby incorporated into this Agreement by reference. Each Phantom Unit granted hereunder shall constitute a Phantom Unit under the terms of the Plan and is hereby granted in tandem
with a corresponding DER, as further detailed in Section 3 below. Except as otherwise expressly provided herein, all capitalized terms used in this Agreement, but not defined, shall have the meanings provided in the Plan.

 GRANT NOTICE 

Subject to the terms and conditions of this Agreement, the principal features of this Award are as follows: 

Participant: [                    ]

 Number of Phantom Units: [            ] Phantom Units 

Grant Date: [        ], 20[    ] 

Vesting of Phantom Units: [To be set forth in individual award agreements]. 

Forfeiture of Phantom Units: In the event of a termination of the Participant’s Service for Cause, all Phantom Units that have not
vested prior to or in connection with such termination of Service shall thereupon automatically be forfeited by the Participant without further action and for no consideration. In the event of a termination of the Participant’s Service for any
other reason, all Phantom Units that have not vested prior to or in connection with such termination of Service shall be forfeited by the Participant sixty (60) days after the termination date, unless the Committee determines in its discretion
to provide for accelerated vesting of all or a portion of the Award. For the avoidance of doubt, no Phantom Units shall vest during such sixty (60) day period unless determined by the Committee in its discretion. 

Payment of Phantom Units: Vested Phantom Units shall be paid to the Participant in the form of Units as set forth in and subject to
Section 5 below. 
 DERs: Each Phantom Unit granted under this Agreement shall be issued in tandem with a
corresponding DER each of which shall entitle the Participant to receive payments in an amount equal to Partnership distributions with respect to a Unit in accordance with Section 3 below. Unless otherwise determined by the
Committee in its discretion, no DER payments shall be made with respect to unvested Phantom Units after the date of a Participant’s termination of Service, regardless of whether such Phantom Units have yet been forfeited. 

 TERMS AND CONDITIONS OF PHANTOM UNITS 

1.    Grant. The Company hereby grants to the Participant, as of the Grant Date, an Award of the number of Phantom
Units set forth in the Grant Notice above, subject to all of the terms and conditions contained in this Agreement and the Plan. 

2.    Phantom Units. Subject to Section 4 below, each Phantom Unit that vests shall
represent the right to receive payment, in accordance with Section 5 below, in the form of one (1) Unit. Unless and until a Phantom Unit vests, the Participant will have no right to payment in respect of such Phantom
Unit. Prior to actual payment in respect of any vested Phantom Unit, such Phantom Unit will represent an unsecured obligation of the Partnership, payable (if at all) only from the general assets of the Partnership. 

3.    Grant of Tandem DER. Each Phantom Unit granted hereunder is hereby granted in tandem with a corresponding
DER, which shall remain outstanding from the Grant Date until the earlier of the payment or forfeiture of the related Phantom Unit, and which shall be subject to all of the terms and conditions contained in this Agreement and the Plan. Each DER
shall entitle the Participant to receive payments, in accordance with Section 5 below, in an amount equal to any distributions made by the Partnership following the Grant Date in respect of the Unit underlying the Phantom
Unit to which such DER relates. Notwithstanding the foregoing, unless otherwise determined by the Committee in its discretion, no payments shall be made after the date of the Participant’s termination of Service with respect to DERs that
correspond to unvested Phantom Units, regardless of whether such Phantom Units have yet been forfeited. 

4.    Vesting and Forfeiture. 

(a)    Vesting. Subject to Section 4(c) below, the Phantom Units shall
vest in such amounts and at such times as are set forth in the Grant Notice above. 

(b)    Accelerated Vesting. [To be set forth in individual award agreements.] 

(c)    Forfeiture. In the event of a termination of the Participant’s Service for Cause by the
Partnership, the Company or any of their Affiliates, all Phantom Units that have not vested prior to such termination of Service shall thereupon automatically be forfeited by the Participant without further action and without payment of
consideration therefor. In the event of a termination of the Participant’s Service for any other reason, all Phantom Units that have not vested prior to or in connection with such termination of Service shall be forfeited by the Participant
sixty (60) days after the termination date, unless the Committee determines in its discretion before the expiration of such 60-day period to provide for accelerated vesting of all or a portion of the
Award. Except for such accelerated vesting in the Committee’s discretion, no other vesting shall occur during the 60-day period after the Participant’s termination date pursuant to the Grant Notice
or this Section 4, including, for the avoidance of doubt, due to the passing of a regular scheduled vesting date or in connection with a Change in Control as set forth in Section 4(b) above. 

(d)    Payment. Vested Phantom Units shall be subject to the payment provisions set forth in
Section 5 below. 

  
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 5.    Payment of Phantom Units and DERs. 

(a)    Phantom Units. Unpaid, vested Phantom Units shall be paid to the Participant in the form of
Units in a lump-sum as soon as reasonably practical, but not later than March 15 of the year following the year in which such Phantom Units vest. Payments of any Phantom Units that vest in accordance
herewith shall be made to the Participant (or in the event of the Participant’s death, to the Participant’s estate) in whole Units in accordance with this Section 5. In lieu of the foregoing, the Committee may
elect at its discretion to pay some or all of the Phantom Units in cash equal to the Fair Market Value of the Units that would otherwise be distributed as of the date of vesting. 

(b)    DERs. Payments in respect of DERs shall be made to the Participant on the next regular
payroll payment date following the date on which Partnership distributions are made to the Partnership’s common unit holders. 

(c)    Potential Delay. Notwithstanding anything to the contrary in this Agreement, no amounts
payable under this Agreement shall be paid to the Participant prior to the expiration of the six (6)-month period following his “separation from service” (within the meaning of Treasury Regulation
Section 1.409A-1(h)) (a “Separation from Service”) to the extent that the Company determines that paying such amounts prior to the expiration of such six (6)-month period would result in
a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code. If the payment of any such amounts is delayed as a result of the previous sentence, then on the first business day following the end of the applicable six (6)-month period
(or such earlier date upon which such amounts can be paid under Section 409A of the Code without resulting in a prohibited distribution, including as a result of the Participant’s death), such amounts shall be paid to the Participant. 

6.    Tax Withholding. The Company and/or its Affiliates shall have the authority and the right to deduct or
withhold, or to require the Participant to remit to the Company and/or its Affiliates, an amount sufficient to satisfy all applicable federal, state, local and foreign taxes (including the Participant’s employment tax obligations) required by
law to be withheld with respect to any taxable event arising in connection with the Phantom Units and the DERs. In satisfaction of the foregoing requirement, unless otherwise determined by the Committee, the Company and/or its Affiliates shall
withhold (or provide for the purchase by an affiliate of the Company of) Units otherwise issuable or payable in respect of such Phantom Units having a Fair Market Value equal to the sums required to be withheld. In the event that Units that would
otherwise be issued in payment of the Phantom Units are used to satisfy such withholding obligations, the number of Units which shall be so withheld shall be limited to the number of Units which have a Fair Market Value (which, in the case of a
broker-assisted transaction, shall be determined by the Committee, consistent with applicable provisions of the Code) on the date of withholding equal to the aggregate amount of such liabilities based on the minimum statutory withholding rates for
federal, state, local and foreign income tax and payroll tax purposes that are applicable to such supplemental taxable income. 

7.    Rights as Unit Holder. Neither the Participant nor any person claiming under or through the Participant shall
have any of the rights or privileges of a holder of Units in respect of any Units that may become deliverable hereunder unless and until certificates representing such Units shall have been issued or recorded in book entry form on the records of the
Partnership or its transfer agents or registrars, and delivered in certificate or book entry form to the Participant or any person claiming under or through the Participant. 

  
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 8.    Non-Transferability.
Neither the Phantom Units nor any right of the Participant under the Phantom Units may be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by the Participant (or any permitted transferee) other than by will or the
laws of descent and distribution and any such purported assignment, alienation, pledge, attachment, sale, transfer or encumbrance shall be void and unenforceable against the Company, the Partnership and any of their Affiliates. 

9.    Distribution of Units. Unless otherwise determined by the Committee or required by any applicable law, rule
or regulation, neither the Company nor the Partnership shall deliver to the Participant certificates evidencing Units issued pursuant to this Agreement and instead such Units shall be recorded in the books of the Partnership (or, as applicable, its
transfer agent or equity plan administrator). All certificates for Units issued pursuant to this Agreement and all Units issued pursuant to book entry procedures hereunder shall be subject to such stop transfer orders and other restrictions as the
Company may deem advisable under the Plan or the rules, regulations, and other requirements of the SEC, any stock exchange upon which such Units are then listed, and any applicable federal or state laws, and the Company may cause a legend or legends
to be inscribed on any such certificates or book entry to make appropriate reference to such restrictions. In addition to the terms and conditions provided herein, the Company may require that the Participant make such covenants, agreements, and
representations as the Company, in its sole discretion, deems advisable in order to comply with any such laws, regulations, or requirements. No fractional Units shall be issued or delivered pursuant to the Phantom Units and the Committee shall
determine, in its discretion, whether cash, other securities, or other property shall be paid or transferred in lieu of fractional Units or whether such fractional Units or any rights thereto shall be canceled, terminated, or otherwise eliminated.

 10.    Partnership Agreement. Units issued upon payment of the Phantom Units shall be subject to the terms of
the Plan and the Partnership Agreement. Upon the issuance of Units to the Participant, the Participant shall, automatically and without further action on his or her part, (i) be admitted to the Partnership as a Limited Partner (as defined in
the Partnership Agreement) with respect to the Units, and (ii) become bound, and be deemed to have agreed to be bound, by the terms of the Partnership Agreement. 

11.    No Effect on Service. Nothing in this Agreement or in the Plan shall be construed as giving the Participant
the right to be retained in the employ or service of the Company or any Affiliate thereof. Furthermore, the Company and its Affiliates may at any time dismiss the Participant from employment or consulting free from any liability or any claim under
the Plan or this Agreement, unless otherwise expressly provided in the Plan, this Agreement or any other written agreement between the Participant and the Company or an Affiliate thereof. 

12.    Severability. If any provision of this Agreement is or becomes or is deemed to be invalid, illegal, or
unenforceable in any jurisdiction, such provision shall be construed or deemed amended to conform to the applicable law or, if it cannot be construed or deemed amended without, in the determination of the Committee, materially altering the intent of
this Agreement, such provision shall be stricken as to such jurisdiction, and the remainder of this Agreement shall remain in full force and effect. 

13.    Tax Consultation. None of the Board, the Committee, the Company, the Partnership nor any Affiliate of any of
the foregoing has made any warranty or representation to Participant with respect to the tax consequences of the issuance, holding, 

  
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vesting, payment, settlement or other occurrence with respect to the Phantom Units, the DERs, the Units or the transactions contemplated by this Agreement, and the Participant represents that he
or she is in no manner relying on such entities or their representatives for tax advice or an assessment of such tax consequences. The Participant understands that the Participant may suffer adverse tax consequences in connection with the Phantom
Units and DERs granted pursuant to this Agreement. The Participant represents that the Participant has consulted with his or her tax consultants that the Participant deems advisable in connection with the Phantom Units and DERs. 

14.    Amendments, Suspension and Termination. To the extent permitted by the Plan, this Agreement may be wholly or
partially amended or otherwise modified, suspended or terminated at any time or from time to time by the Board or the Committee. Except as provided in the preceding sentence, this Agreement cannot be modified, altered or amended, except by an
agreement, in writing, signed by both the Partnership and the Participant. 

15.    Lock-Up Agreement. The Participant shall agree, if so requested by
the Company or the Partnership and any underwriter in connection with any public offering of securities of the Partnership or any Affiliate thereof, not to directly or indirectly offer, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right or warrant for the sale of or otherwise dispose of or transfer any Units held by him or her for such period, not to exceed one hundred eighty (180) days following the
effective date of the relevant registration statement filed under the Securities Act in connection with such public offering, as such underwriter shall specify reasonably and in good faith. The Company or the Partnership may impose stop-transfer
instructions with respect to securities subject to the foregoing restrictions until the end of such 180-day period. Notwithstanding the foregoing, the 180-day period may
be extended in the discretion of the Company for up to such number of additional days as is deemed necessary by such underwriter or the Company or Partnership to continue coverage by research analysts in accordance with FINRA Rule 2711 or any
successor or other applicable rule. 
 16.    Conformity to Securities Laws. The Participant acknowledges that
the Plan and this Agreement are intended to conform to the extent necessary with all provisions of the Securities Act and the Exchange Act, any and all regulations and rules promulgated by the SEC thereunder, and all applicable state securities laws
and regulations. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the Phantom Units and DERs are granted, only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by
applicable law, the Plan and this Agreement shall be deemed amended to the extent necessary to conform to such laws, rules and regulations. 

17.    Code Section 409A. None of the Phantom Units, the DERs or any amounts paid pursuant to
this Agreement are intended to constitute or provide for a deferral of compensation that is subject to Section 409A of the Code. Nevertheless, to the extent that the Committee determines that the Phantom Units or DERs may not be exempt from (or
compliant with) Section 409A of the Code, the Committee may (but shall not be required to) amend this Agreement in a manner intended to comply with the requirements of Section 409A of the Code or an exemption therefrom (including
amendments with retroactive effect), or take any other actions as it deems necessary or appropriate to (a) exempt the Phantom Units or DERs from Section 409A of the Code and/or preserve the intended tax treatment of the benefits provided
with respect to the Phantom Units or DERs, or (b) comply with the requirements of Section 409A of the Code. To the extent applicable, this Agreement shall be interpreted in accordance with the provisions of Section 409A of the

  
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Code. Notwithstanding anything in this Agreement to the contrary, to the extent that any payment or benefit hereunder constitutes non-exempt
“nonqualified deferred compensation” for purposes of Section 409A of the Code, and such payment or benefit would otherwise be payable or distributable hereunder by reason of the Participant’s termination of Service, all
references to the Participant’s termination of Service shall be construed to mean a Separation from Service, and the Participant shall not be considered to have a termination of Service unless such termination constitutes a Separation from
Service with respect to the Participant. 
 18.    Adjustments; Clawback. The Participant acknowledges that the
Phantom Units are subject to modification and forfeiture in certain events as provided in this Agreement and Section 7 of the Plan. The Participant further acknowledges that the Phantom Units, DERs and Units issuable hereunder, whether vested
or unvested and whether or not previously issued, are subject to clawback as provided in Section 8(o) of the Plan. 

19.    Successors and Assigns. The Company or the Partnership may assign any of its rights under this Agreement to
single or multiple assignees, and this Agreement shall inure to the benefit of the successors and assigns of the Company and the Partnership. Subject to the restrictions on transfer contained herein, this Agreement shall be binding upon the
Participant and his or her heirs, executors, administrators, successors and assigns. 
 20.    Governing Law. The
validity, construction, and effect of this Agreement and any rules and regulations relating to this Agreement shall be determined in accordance with the laws of the State of Delaware without regard to its conflicts of laws principles. 

21.    Headings. Headings are given to the sections and subsections of this Agreement solely as a convenience to
facilitate reference. Such headings shall not be deemed in any way material or relevant to the construction or interpretation of this Agreement or any provision hereof. 

[Signature page follows] 

  
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 The Participant’s signature below indicates the Participant’s agreement with and
understanding that this Award is subject to all of the terms and conditions contained in the Plan and in this Agreement, and that, in the event that there are any inconsistencies between the terms of the Plan and the terms of this Agreement, the
terms of the Plan shall control. The Participant further acknowledges that the Participant has read and understands the Plan and this Agreement, which contains the specific terms and conditions of this grant of Phantom Units and DERs. The
Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions arising under the Plan or this Agreement. 

 

			
	 Howard Midstream GP, LLC
 a Delaware
limited liability company

		
	By:	 	  

	Name:	 	
	Title:	 	
	
	 Howard Midstream Partners, LP
 a
Delaware limited partnership

		
	By:	 	Howard Midstream GP, LLC
	Its:	 	General Partner
		
	By:	 	  

	Name:	 	
	Title:	 	
	
	“PARTICIPANT”
	
	  

			
		
	Print Name:	 	  

  
 7Moody National REIT II, Inc. 8-K

 

Exhibit 10.1

 

PROMISSORY NOTE

	$30,647,570.07	September 6, 2017

 

FOR VALUE RECEIVED,
Moody National 1 Polito Lyndhurst Holding, LLC, a Delaware limited liability company (“Borrower”), hereby promises
to pay to the order of Moody National Operating Partnership II, LP, a Delaware limited partnership (together with any and all of
its successors and assigns and/or any other holder of this Note, “Lender”), without offset, in immediately available
funds in lawful money of the United States of America, the principal sum of Thirty Million, Six Hundred Forty-Seven Thousand, Five
Hundred Seventy Dollars and Seven Cents ($30,647,570.07) (or the unpaid balance of all principal advanced against this Note, if
that amount is less), together with interest on the unpaid principal balance of this Note from day to day outstanding as hereinafter
provided.

Section 1.

Payment Schedule
and Maturity Dates. Principal and interest on this Note shall be payable as follows:

The entire principal
balance of this Note then unpaid, together with all accrued and unpaid interest and all other amounts payable hereunder and under
the other Loan Documents (as hereinafter defined), shall be due and payable in full upon the closing of the merger between Moody
National REIT I, Inc. and Moody National REIT II, Inc. but in no event later than September 30, 2017 (the “Maturity Date”).

Section 2.

Security; Loan
Documents. The security for this Note includes those certain Mortgage, Security Agreement and Fixture Filing (as the same
may from time to time be amended, restated, modified or supplemented, collectively the “Mortgage”) of even
date herewith from each Borrower to Lender, conveying and encumbering certain real and personal property owned by such Borrower
and more particularly described therein (the “Property”). This Note, the Mortgage, and all other documents
now or hereafter securing, guaranteeing or executed in connection with the loan evidenced by this Note (the “Loan”),
as the same may from time to time be amended, restated, modified or supplemented, are herein sometimes called individually a “Loan
Document” and together the “Loan Documents.”

Section 3.

Interest Rate.
Interest on the outstanding principal balance of, and all other sums owing under this Note, which are not past due, shall accrue
and be payable at a per annum rate which is equal to the lesser of (i) the Maximum Lawful Rate (as defined below), or (ii) the
Note Rate (as defined below). Interest shall be computed for the actual number of days which have elapsed, on the basis of a 360-day
year. The term “Note Rate” shall mean six and one-half percent (6.50%) per annum. The term “Maximum
Lawful Rate” shall mean the maximum lawful rate of interest which may be contracted for, charged, taken, received or
reserved by Lender in accordance with the applicable laws of the State of Texas (or applicable United States federal law to the
extent that such law permits Lender to contract for, charge, take, receive or reserve a greater amount of interest than under Texas
law). If any amount payable by Borrower under any Loan Document is not paid when due (without regard to any applicable grace periods),
such amount shall thereafter bear interest at the Past Due Rate (as defined below) to the fullest extent permitted by applicable
law. Accrued and unpaid interest on past due amounts (including interest on past due interest) shall be due and payable on demand,
at a rate per annum (the “Past Due Rate”) equal to the lesser of (y) eighteen percent (18%), or (z) the Maximum
Lawful Rate.

Section 4.

Prepayment.
Upon one (1) days advanced written notice to Lender, Borrower may prepay all or any portion of the principal amount of this Note.
Any prepayments shall be applied to amounts owed under this Note in the order set forth in Section 6 below.

Section 5.

Late Charges. If
Borrower shall fail to make any payment under the terms of this Note (other than the payment due at maturity) within five (5) days
after the date such payment is due, Borrower shall pay to Lender on demand a late charge equal to five percent (5%) of the amount
of such payment. Such five (5) day period shall not be construed as in any way extending the due date of any payment or the Maturity
Date. The late charge is imposed for the purpose of defraying the expenses of Lender incident to handling such delinquent payment.
This charge shall be in addition to, and not in lieu of, any other amount that Lender may be entitled to receive or action that
Lender may be authorized to take as a result of such late payment.

 

    		 	 

    	 

    

  

Section 6.

Certain Provisions
Regarding Payments. All payments on this Note shall, at the sole option of Lender, be applied at any time and from time to
time and in any order, to the following: (a) the payment or reimbursement of any expenses, late charges, costs or obligations (other
than the principal hereof and interest hereon) for which Borrower shall be obligated or Lender entitled pursuant to the provisions
hereof or of the other Loan Documents, (b) the payment of accrued but unpaid interest hereon, and (c) the payment of all or any
portion of the principal balance then outstanding hereunder. Remittances shall be made without offset, demand, counterclaim, deduction,
or recoupment (each of which is hereby waived) and shall be 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 Lender of any payment in an amount
less than the amount then due on any indebtedness shall be deemed an acceptance on account only, notwithstanding any notation on
or accompanying such partial payment to the contrary, and shall not in any way (a) waive or excuse the existence of an Event of
Default (as hereinafter defined), (b) waive, impair or extinguish any right or remedy available to Lender hereunder or under the
other Loan Documents, or (c) waive the requirement of punctual payment and performance or constitute a novation in any respect.
Payments received after 2:00 p.m. shall be deemed to be received on, and shall be posted as of, the following Business Day. Whenever
any payment under this Note or any other Loan Document falls due on a day which is not a Business Day, such payment may be made
on the next succeeding Business Day.

Section 7.

Events of Default.
The occurrence of any one or more of the following shall constitute an “Event of Default” under this Note:

(a)       

Borrower fails
to pay when and as due and payable any amounts payable by Borrower to Lender under the terms of this Note.

(b)       

Borrower fails
to timely perform, observe or keep any covenant, agreement or condition in this Note and (other than a monetary payment under (a)
above) and such failure continues uncured for a period of thirty (30) days after notice from Lender to Borrower.

(c)       

An Event of Default
(as therein defined) occurs under any of the Loan Documents other than this Note.

Section 8.

Remedies.
Upon the occurrence of an Event of Default, Lender may at any time thereafter exercise any one or more of the following rights,
powers and remedies:

(a)       

Lender may accelerate
the Maturity Date and declare the unpaid principal balance and accrued but unpaid interest on this Note, and all other amounts
payable hereunder and under the other Loan Documents, at once due and payable, and upon such declaration the same shall at once
be due and payable.

(b)       

Lender may set
off the amount due against any and all accounts, credits, money, securities or other property now or hereafter on deposit with,
held by or in the possession of Lender to the credit or for the account of Borrower, without notice to or the consent of Borrower.

(c)       

Lender may exercise
any of its other rights, powers and remedies under the Loan Documents or at law or in equity.

Section 9.

Remedies Cumulative.
All of the rights and remedies of Lender under this Note and the other Loan Documents are cumulative of each other and of any and
all other rights at law or in equity, and the exercise by Lender of any one or more of such rights and remedies shall not preclude
the simultaneous or later exercise by Lender of any or all such other rights and remedies. No single or partial exercise of any
right or remedy shall exhaust it or preclude any other or further exercise thereof, and every right and remedy may be exercised
at any time and from time to time. No failure by Lender to exercise, nor delay in exercising, any right or remedy shall operate
as a waiver of such right or remedy or as a waiver of any Event of Default.

 

    	PROMISSORY
                                         NOTE - Page 2	 	 

    	 

    

  

Section 10.

Costs and Expenses
of Enforcement. Borrower agrees to pay to Lender on demand all reasonable costs and expenses incurred by Lender in seeking
to collect this Note or to enforce any of Lender’s rights and remedies under the Loan Documents, including court costs and
reasonable attorneys’ fees and expenses, whether or not suit is filed hereon, or whether in connection with bankruptcy, insolvency
or appeal. Nothing in this Note shall affect the right of Lender to serve process in any manner otherwise permitted by law and
nothing in this Note will limit the right of Lender otherwise to bring proceedings against Borrower in the courts of any jurisdiction
or jurisdictions.

Section 11.

Heirs, Successors
and Assigns. The terms of this Note and of the other Loan Documents shall bind and inure to the benefit of the heirs, devisees,
representatives, successors and assigns of the parties. The foregoing sentence shall not be construed to permit Borrower to assign
the Loan except as otherwise permitted under the Loan Documents.

Section 12.

General Provisions.
Time is of the essence with respect to Borrower’s obligations under this Note. If more than one person or entity executes
this Note as Borrower, all of said parties shall be jointly and severally liable for payment of the indebtedness evidenced hereby.
Borrower and each party executing this Note as Borrower hereby severally (a) waive demand, presentment for payment, notice of dishonor
and of nonpayment, protest, notice of protest, notice of intent to accelerate, notice of acceleration and all other notices (except
any notices which are specifically required by this Note or any other Loan Document), filing of suit and diligence in collecting
this Note or enforcing any of the security herefor; (b) agree to any substitution, subordination, exchange or release of any
such security or the release of any party primarily or secondarily liable hereon; (c) agree that Lender shall not be required first
to institute suit or exhaust its remedies hereon against Borrower or others liable or to become liable hereon or to perfect or
enforce its rights against them or any security herefor; (d) consent to any extensions or postponements of time of payment of this
Note for any period or periods of time and to any partial payments, before or after maturity, and to any other indulgences with
respect hereto, without notice thereof to any of them; and (e) submit (and waive all rights to object) to non-exclusive personal
jurisdiction of any state or federal court sitting in the state and county in which payment of this Note is to be made for the
enforcement of any and all obligations under this Note and the other Loan Documents; (f) waive the benefit of all homestead and
similar exemptions as to this Note; (g) agree that their liability under this Note shall not be affected or impaired by any determination
that any title, security interest or lien taken by Lender to secure this Note is invalid or unperfected; and (h) hereby subordinate
to the Loan and the Loan Documents any and all rights against Borrower and any security for the payment of this Note, whether by
subrogation, agreement or otherwise, until this Note is paid in full. A determination that any provision of this Note is unenforceable
or invalid shall not affect the enforceability or validity of any other provision and the determination that the application of
any provision of this Note to any person or circumstance is illegal or unenforceable shall not affect the enforceability or validity
of such provision as it may apply to other persons or circumstances. This Note may not be amended except in a writing specifically
intended for such purpose and executed by the party against whom enforcement of the amendment is sought. Captions and headings
in this Note are for convenience only and shall be disregarded in construing it. This Note and its validity, enforcement and interpretation
shall be governed by the laws of the State of Texas (without regard to any principles of conflicts of laws) and applicable United
States federal law. Whenever a time of day is referred to herein, unless otherwise specified such time shall be the local time
of the place where payment of this Note is to be made. The term “Business Day” shall mean any day other than
a Saturday, Sunday or other day on which commercial banks are authorized to close under the Laws of Texas. Capitalized terms used
herein without definition shall have the meanings ascribed to such terms in the Loan Agreement. The words “include”
and “including” shall be interpreted as if followed by the words “without limitation.”

Section 13.

Notices. Any notice,
request, or demand to or upon Borrower or Lender shall be deemed to have been properly given or made when delivered in accordance
with the terms of the Loan Agreement regarding notices.

 

    	PROMISSORY
                                         NOTE - Page 3	 	 

    	 

    

  

Section 14.

No Usury.
Interest on the debt evidenced by this Note will not exceed the maximum rate or amount of nonusurious interest that may be contracted
for, taken, reserved, charged, or received under law. Any interest in excess of that maximum amount will be credited on the unpaid
principal of this Note, if the principal has been paid, refunded. On any acceleration or required or permitted prepayment, any
excess interest will be cancelled automatically as of the acceleration or prepayment or, if the excess interest has already been
paid, credited on the principal or, if the principal has been paid, refunded. This provision overrides any conflicting provisions
in this Note, the Loan Agreement, Loan Documents and all other instruments concerning the obligations under the Loan. Borrower
hereby agrees that as a condition precedent to any claim seeking usury remedies or penalties against Lender, Borrower will provide
written notice to Lender, advising Lender in reasonable detail of the nature and amount of the violation and Lender shall have
sixty days after receipt of such notice in which to correct such usury violation, if any, by either refunding such excess interest
to Borrower or crediting such excess interest against the Loan or the Note then owing by Borrower to Lender. To the extent that
Lender is relying on Chapter 303 of the Texas Finance Code to determine the Maximum Lawful Rate payable on the Note or any other
portion of the Indebtedness, Lender will utilize the weekly ceiling from time to time in effect as provided in such Chapter 303,
as amended. To the extent United States federal law permits Lender to contract for, charge, take, receive or reserve a greater
amount of interest than under Texas law, Lender will rely on United States federal law instead of such Chapter 303 for the purpose
of determining the Maximum Lawful Rate. Additionally, to the extent permitted by applicable law now or hereafter in effect, Lender
may, at its option and from time to time, utilize any other method of establishing the Maximum Lawful Rate under such Chapter 303
or under other applicable law by giving notice, if required, to Borrower as provided by applicable law now or hereafter in effect.
In no event shall the provisions of Chapter 346 of the Texas Finance Code (which regulates certain revolving credit loan accounts
and revolving triparty accounts) apply to the Loan or any other Obligation.

15.       

Further Assurances
and Corrections. From time to time, at the request of Lender, Borrower will (i) promptly correct any defect, error or omission
which may be discovered in the contents of this Note or in any other Loan Document or in the execution or acknowledgement thereof;
(ii) execute, acknowledge, deliver, record and/or file (or cause to be executed, acknowledged, delivered, recorded and/or filed)
such further documents and instruments (including, without limitation, further deeds of trust, security agreements, financing statements,
continuation statements and assignments of rents) and perform such further acts and provide such further assurances as may be necessary,
desirable, or proper, in Lender's opinion, (A) to carry out more effectively the purposes of this Note and the Loan Documents and
the transactions contemplated hereunder and thereunder, (B) to confirm the rights created under this Note and the other Loan Documents,
(C) to protect and further the validity, priority and enforceability of this Note and the other Loan Documents and the liens and
security interests created thereby, and (D) to subject to the Loan Documents any property of Borrower intended by the terms of
any one or more of the Loan Documents to be encumbered by the Loan Documents; and (iii) pay all costs in connection with any of
the foregoing.

16.       

Rate Change for
Failure to Provide Financial Information. Borrower shall provide Lender from time to time with current financial information
for Borrower, as such financial information is reasonably requested by Lender and/or as provided in any Loan Documents executed
by Borrower in connection herewith. In the event Borrower shall fail to provide such financial information to Lender whether pursuant
to a request from Lender or as provided in any Loan Documents executed in connection herewith and after the expiration of any notice
and right to cure periods (if any), Borrower and Lender acknowledge and agree that the Note Rate shall increase by one percent
(1.00%).

17.       

Debtor and Creditor
Relationship. Notwithstanding any prior business or personal relationship between Borrower and Lender, or any officer, director
or employee of Lender that may exist or have existed, the relationship between Borrower and Lender is solely that of debtor and
creditor, Lender has no fiduciary or other special relationship with Borrower, Borrower and Lender are not partners or joint venturers,
and no term or condition of any of the Loan Documents shall be construed so as to deem the relationship between Borrower and Lender
to be other than that of debtor and creditor.

18.       

APPLICABLE LAW.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS AND ANY APPLICABLE LAWS OF THE
UNITED STATES OF AMERICA.

 

    	PROMISSORY
                                         NOTE - Page 4	 	 

    	 

    

  

19.       

WAIVER OF JURY
TRIAL. BORROWER AND LENDER (BY ACCEPTANCE OF THIS NOTE) WAIVE TRIAL BY JURY IN RESPECT TO ANY DISPUTE AND ANY ACTION ON SUCH
DISPUTE. THIS WAIVER IS KNOWINGLY, WILLINGLY AND VOLUNTARILY MADE BY BORROWER AND LENDER, AND BORROWER AND LENDER HEREBY REPRESENT
THAT NO REPRESENTATIONS OF FACT OR OPINION HAVE BEEN MADE BY ANY PERSON OR ENTITY TO INDUCE THIS WAIVER OF TRIAL BY JURY OR TO
IN ANY WAY MODIFY OR NULLIFY ITS EFFECT. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES ENTERING INTO THE LOAN DOCUMENTS.
BORROWER AND LENDER ARE EACH HEREBY AUTHORIZED TO FILE A COPY OF THIS SECTION IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS
WAIVER OF JURY TRIAL. BORROWER FURTHER REPRESENTS AND WARRANTS THAT IT HAS BEEN REPRESENTED IN THE SIGNING OF THIS NOTE AND IN
THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL, OR HAS HAD THE OPPORTUNITY TO BE REPRESENTED BY INDEPENDENT LEGAL COUNSEL
SELECTED OF ITS OWN FREE WILL, AND THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH COUNSEL. 

20.       

BALLOON PAYMENT.
THIS NOTE IS PAYABLE IN FULL ON THE CLOSING OF THE MERGER BETWEEN MOODY NATIONAL REIT I, INC. AND MOODY NATIONAL REIT II, INC.
BUT IN NO EVENT LATER THAN SEPTEBMER 30, 2017. YOU MUST REPAY THE ENTIRE PRINCIPAL BALANCE OF THE NOTE AND UNPAID ACCRUED INTEREST
THEN DUE. THE LENDER IS UNDER NO OBLIGATION TO REFINANCE THE NOTE AT THAT TIME. YOU WILL, THEREFORE, BE REQUIRED TO MAKE PAYMENT
OUT OF OTHER ASSETS YOU MAY OWN, OR YOU WILL HAVE TO FIND A LENDER WILLING TO LEND YOU THE MONEY AT PREVAILING MARKET RATES, WHICH
MAY BE CONSIDERABLY HIGHER OR LOWER THAN THE INTEREST RATE ON THIS NOTE. IF YOU REFINANCE THIS NOTE AT MATURITY, YOU MAY HAVE TO
PAY SOME OR ALL CLOSING COSTS NORMALLY ASSOCIATED WITH A NEW LOAN EVEN IF YOU OBTAIN REFINANCING FROM THE SAME LENDER.

21.       

TEXAS PROPERTY
CODE WAIVERS. TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, BORROWER WAIVES ALL RIGHTS, REMEDIES, CLAIMS AND DEFENSES
BASED UPON OR RELATED TO SECTIONS 51.003 AND 51.004 OF THE TEXAS PROPERTY CODE TO THE EXTENT THEY PERTAIN OR MAY PERTAIN TO ANY
ENFORCEMENT OR COLLECTION OF THIS NOTE.

22.       

ENTIRE AGREEMENT.
THIS NOTE AND THE OTHER LOAN DOCUMENTS CONTAIN THE FINAL, ENTIRE AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE
OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES.

 

 

(remainder of page intentionally left blank;
signature page follows)

 

    	PROMISSORY
                                         NOTE - Page 5	 	 

    	 

    

 

IN WITNESS WHEREOF,
Borrower has duly executed this Note under seal as of the date first above written.

	 	BORROWER:
	 	 
	 	 
	 	Moody National 1 Polito Lyndhurst Holding, LLC, a Delaware limited liability company
	 	 
	 	By:	/s/ Brett C. Moody
	 	 	Brett C. Moody, President

 

    	PROMISSORY
                                         NOTE - Page 6

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