Document:

Exhibit 10.95

 

	
  

  	
   

  	
  Guaranty

  

 

THIS GUARANTY (this “Guaranty”) is made and entered into effective as of the 3rd
day of August 2007, by Behringer Harvard Opportunity REIT I, Inc., a Maryland
corporation (“Guarantor”) for the benefit of Comerica
Bank (“Lender”).

 

W I T N E S S E T H:

 

WHEREAS, FRISCO SQUARE
LAND, LTD., a Texas limited partnership (“Original Borrower”)
has executed and delivered to Lender:

 

(i)                                     that
certain Amended and Restated Loan Agreement dated effective as of the 10th day
of March, 2006, executed by and between Original Borrower and Lender, as
amended by that certain Modification And Extension Agreement (the “SLOC Modification”) dated effective as of March 10, 2007
executed by and between Original Borrower and Lender (as so amended, the “Loan Agreement”);

 

(ii)                                  that
certain Amended and Restated Promissory Note Eurodollar Rate-Single Payment
Note (the “Term Note”) dated March 10, 2006
executed by Original Borrower, and payable to the order of Lender, in the
maximum face amount of Twenty Six Million Six Hundred Sixty Four Thousand And
No/100 Dollars ($26,664,000.00),

 

(iii)                               that certain Note (the “SLOC Note”) dated effective March 10, 2006 executed by
Original Borrower, and payable to the order of Lender, as amended by the SLOC
Modification, in the maximum amount of One Million Five Hundred Thousand And
No/100 Dollars ($1,500,000.00) (the Term Note and SLOC Note are referred to
herein collectively as the “Notes”); and

 

(iv)                              that
certain Amended and Restated Deed of Trust, Security Agreement and Assignment
of Rents (the “Deed of Trust”) dated March 10,
2006 from Borrower to Melinda A. Chausse, Trustee, for the benefit of Lender,
securing the payment of the Notes, covering certain real and personal property
described therein and more particularly described on Exhibit A attached hereto
and made a part hereof (the “Original Mortgaged
Property”), and recorded under document number 20060314000340000,
Official Public Records, Collin County, Texas (the Loan Agreement, Deed of
Trust and all other documents executed by Borrower and/or any other party or
parties evidencing or securing or otherwise in connection with the loans
evidenced by the Term Note being herein collectively called the “Loan Documents”);

 

WHEREAS,
contemporaneously herewith, a portion of the Original Mortgaged Property has
been released from the lien of the Deed of Trust and Original Borrower has
conveyed the remainder of the Original Mortgaged Property (herein, the “Mortgaged Property”) to BHFS I, LLC, a Delaware limited
liability company (“Borrower”), and
assigned to Borrower of all of Original Borrower’s obligations under the Loan
Documents; and Borrower has assumed all of the obligations of Original Borrower,
as of 

 

1

 

the date of the Assumption Agreement (as defined
below), under the Loan Documents, pursuant to and as modified by that certain
Assumption and Modification Agreement dated August 3, 2007 executed by and
among Lender, Original Borrower and Borrower (the “Assumption
Agreement”);

 

WHEREAS, pursuant to the
terms of the Assumption Agreement, the SLOC Note has been paid in full;

 

WHEREAS, the execution
and delivery of this Guaranty by Guarantor to Lender was a condition to Lender’s
consent to the conveyance of the Mortgaged Property to Borrower and the
modifications of the Loan Documents set forth in the Assumption Agreement;

 

NOW, THEREFORE, for and in consideration of the mutual
covenants contained herein and for other valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, Guarantor hereby agrees as
follows:

 

As of August 3, 2007, Guarantor, for value received,
unconditionally and absolutely guarantees to Lender, payment when due, whether
by stated maturity, demand, acceleration or otherwise, of all existing and
future indebtedness (“Indebtedness”)
to Lender of Borrower but only to the extent that amounts become payable after
the date hereof. Indebtedness includes without limit any and all obligations or
liabilities of Borrower to Lender, whether absolute or contingent, direct or
indirect, voluntary or involuntary, liquidated or unliquidated, joint or
several, known or unknown, originally payable to Lender or to a third party and
subsequently acquired by Lender including, without limitation, late charges, loan
fees or charges and overdraft indebtedness; any and all indebtedness,
obligations or liabilities for which Borrower would otherwise be liable to Lender
were it not for the invalidity, irregularity or unenforceability of them by
reason of any bankruptcy, insolvency or other law or order of any kind, or for
any other reason; any and all amendments, modifications, renewals and/or
extensions of any of the above; and all costs of collecting Indebtedness,
including, without limit, attorneys’ fees. Any reference in this Guaranty to
attorneys’ fees shall be deemed a reference to reasonable fees, charges, costs
and expenses of counsel and paralegals, whether inside or outside counsel is
used, and whether or not a suit or action is instituted, and to court costs if
a suit or action is instituted, and whether attorneys’ fees or court costs are
incurred at the trial court level, on appeal, in a bankruptcy, administrative
or probate proceeding or otherwise. All costs shall be payable immediately by Guarantor
when incurred by Lender, without demand, and until paid shall bear interest at
the highest per annum rate applicable to any of the Indebtedness, but not in
excess of the maximum rate permitted by law.

 

1.                                      LIMITED
GUARANTY:  The total obligation of Guarantor
under this Guaranty is LIMITED. Notwithstanding anything herein to the
contrary, the liability of Guarantor for the outstanding principal of the Term
Note shall not exceed $14,780,695.90 of the principal outstanding thereunder at
any time; and this obligation (irrespective of the limitation above) shall
include, IN ADDITION TO any limited amount of principal guaranteed, all
interest and all costs incurred by Lender in collection efforts against the
Borrower and/or Guarantor or otherwise incurred by Lender in any way relating
to the Indebtedness, or this Guaranty, including without limit reasonable
attorneys’ fees. Guarantor agrees that (a) this limitation shall not be a
limitation on the amount of Borrower’s Indebtedness to Lender; (b) any payments
by Guarantor shall not reduce the maximum liability of Guarantor under this
Guaranty unless written notice to that effect is actually received by Lender
at, or prior to, the time of the payment; and (c) the liability of Guarantor to
Lender shall at all times be deemed to be the aggregate liability of Guarantor
under this Guaranty 

 

2

 

and
any other guaranties previously or subsequently given to the Bank by Guarantor
and not expressly revoked, modified or invalidated in writing.

 

2.                                      NATURE
OF GUARANTY:  This is a continuing guaranty
of payment and not of collection and remains effective whether the Indebtedness
is from time to time reduced and later increased or entirely extinguished and
later reincurred. Guarantor delivers this Guaranty based solely on Guarantor’s
independent investigation of (or decision not to investigate) the financial condition
of Borrower and Guarantor are not relying on any information furnished by Lender.
Guarantor assumes full responsibility for obtaining any further information
concerning Borrower’s financial condition, the status of the Indebtedness or
any other matter which Guarantor may deem necessary or appropriate now or later.
Guarantor knowingly accepts the full range of risk encompassed in this
Guaranty, which risk includes, without limit, the possibility that Borrower may
incur Indebtedness to Lender after the financial condition of Borrower, or Borrower’s
ability to pay debts as they mature, has deteriorated.

 

3.                                      APPLICATION
OF PAYMENTS:  Guarantor authorizes Lender,
either before or after termination of this Guaranty, without notice to or
demand on Guarantor and without affecting any of Guarantor’s liability under
this Guaranty, from time to time to: (a) apply any security and direct the
order or manner of sale; and (b) apply payments received by Lender from
Borrower to any indebtedness of Borrower to Lender, in such order as Lender
shall determine in its sole discretion, whether or not this indebtedness is
covered by this Guaranty, and Guarantor waives any provision of law regarding
application of payments which specifies otherwise. Guarantor agrees to provide
to Lender copies of Guarantor’s financial statements upon request.

 

4.                                      SECURITY:  Guarantor pledges, assigns and grants to Lender
a security interest in and lien upon and the right of setoff as to any and all
property of Guarantor now or later in the possession of Lender. Guarantor
further assigns to Lender as collateral for the obligations of Guarantor under
this Guaranty all claims of any nature that Guarantor now or later has (have)
against Borrower (other than any claim under a deed of trust or mortgage
covering California real property) with full right on the part of Lender, in
its own name or in the name of Guarantor, to collect and enforce these claims. Guarantor
agrees that no security now or later held by Lender for the payment of any
Indebtedness, whether from Borrower, any guarantor, or otherwise, and whether
in the nature of a security interest, pledge, lien, assignment, setoff, suretyship,
guaranty, indemnity, insurance or otherwise, shall affect in any manner the
unconditional obligation of Guarantor under this Guaranty, and Lender, in its
sole discretion, without notice to Guarantor, may release, exchange, enforce
and otherwise deal with any security without affecting in any manner the
unconditional obligation of Guarantor under this Guaranty. Guarantor acknowledges
and agrees that Lender has no obligation to acquire or perfect any lien on or
security interest in any asset(s), whether realty or personalty, to secure
payment of the Indebtedness, and Guarantor is not relying upon any asset(s) in
which Lender has or may have a lien or security interest for payment of the
Indebtedness.

 

5.                                      OTHER
GUARANTORS:  If any Indebtedness is
guaranteed by two or more guarantors, the obligation of Guarantor shall be
several and also joint, each with all and also each with any one or more of the
others, and may be enforced at the option of Lender against each severally, any
two or more jointly, or some severally and some jointly. Lender, in its sole
discretion, may release any one or more of the guarantors for any consideration
which it deems adequate, and may fail or elect not to prove a claim against the
estate of any bankrupt, insolvent, incompetent or deceased guarantor; and after
that, without notice to any guarantor, Lender may extend or renew any or all 

 

3

 

Indebtedness
and may permit Borrower to incur additional Indebtedness, without affecting in
any manner the unconditional obligation of the remaining guarantors. Guarantor
acknowledges that the effectiveness of this Guaranty is not conditioned on any
or all of the Indebtedness being guaranteed by anyone else.

 

6.                                      TERMINATION:  Any of Guarantor may terminate their
obligation under this Guaranty as to future Indebtedness (except as provided
below) by (and only by) delivering written notice of termination to an officer
of Lender and receiving from an officer of Lender written acknowledgement of delivery;
provided, however, the termination shall not be effective until the opening of
business on the fifth (5th) day (“effective date”)
following written acknowledgement of delivery. Any termination shall not affect
in any way the unconditional obligations of the remaining guarantors, whether
or not the termination is known to the remaining guarantors. Any termination
shall not affect in any way the unconditional obligations of the terminating
guarantor as to any Indebtedness existing at the effective date of termination
or any Indebtedness created after that pursuant to any commitment or agreement
of Lender or pursuant to any Borrower loan with Lender existing at the
effective date of termination (whether advances or readvances by Lender after
the effective date of termination are optional or obligatory), or any
modifications, extensions or renewals of any of this Indebtedness, whether in
whole or in part, and as to all of this Indebtedness and modifications,
extensions or renewals of it, this Guaranty shall continue effective until the
same shall have been fully paid. Lender has no duty to give notice of termination
by any guarantor to any remaining guarantors. Guarantor shall indemnify Lender
against all claims, damages, costs and expenses, INCLUDING ANY CLAIMS, DAMAGES, COSTS AND EXPENSES RESULTING FROM LENDER’S
OWN NEGLIGENCE, except and to the extent (but only to the extent)
caused by Lender’s gross negligence or willful misconduct, including, without
limit, attorneys’ fees, incurred by Lender in connection with any suit, claim
or action against Lender arising out of any modification or termination of a
Borrower loan or any refusal by Lender to extend additional credit in
connection with the termination of this Guaranty.

 

7.                                      REINSTATEMENT:  Notwithstanding any prior revocation,
termination, surrender or discharge of this Guaranty (or of any lien, pledge or
security interest securing this Guaranty) in whole or in part, the
effectiveness of this Guaranty, and of all liens, pledges and security
interests securing this Guaranty, shall automatically continue or be reinstated
in the event that any payment received or credit given by Lender in respect of
the Indebtedness is returned, disgorged or rescinded under any applicable state
or federal law, including, without limitation, laws pertaining to bankruptcy or
insolvency, in which case this Guaranty, and all liens, pledges and security
interests securing this Guaranty, shall be enforceable against Guarantor as if
the returned, disgorged or rescinded payment or credit had not been received or
given by Lender, and whether or not Lender relied upon this payment or credit
or changed its position as a consequence of it. In the event of continuation or
reinstatement of this Guaranty and the liens, pledges and security interests
securing it, Guarantor agrees upon demand by Lender, to execute and deliver to Lender
those documents which Lender determines are appropriate to further evidence (in
the public records or otherwise) this continuation or reinstatement, although
the failure of Guarantor to do so shall not affect in any way the reinstatement
or continuation. If Guarantor does not execute and deliver to Lender upon
demand such documents, Lender and each Lender officer is irrevocably appointed
(which appointment is coupled with an interest) the true and lawful attorney of
Guarantor (with full power of substitution) to execute and deliver such
documents in the name and on behalf of Guarantor.

 

4

 

8.                                      WAIVERS:  Guarantor, to the extent not expressly
prohibited by applicable law, waives any right to require Lender to: (a)
proceed against any person or property; (b) give notice of the terms, time and
place of any public or private sale of personal property security held from Borrower
or any other person, or otherwise comply with the provisions of Sections  9-611 or 9-621 of the Texas or other
applicable Uniform Commercial Code, as the same may be amended, revised or
replaced from time to time; or (c) pursue any other remedy in Lender’s power. Guarantor
waives notice of acceptance of this Guaranty and presentment, demand, protest,
notice of protest, dishonor, notice of dishonor, notice of default, notice of
intent to accelerate or demand payment or notice of acceleration of any Indebtedness,
any and all other notices to which Guarantor might otherwise be entitled, and
diligence in collecting any Indebtedness, and all rights of a guarantor under
Rule 31, Texas Rules of Civil Procedure, Chapter 34 of the Texas Business and
Commerce Code, or Section 17.001 of the Texas Civil Practice and Remedies Code,
and agree that Lender may, once or any number of times, modify the terms of any
Indebtedness, compromise, extend, increase, accelerate, renew or forbear to
enforce payment of any or all Indebtedness, or permit Borrower to incur
additional Indebtedness, all without notice to Guarantor and without affecting
in any manner the unconditional obligation of Guarantor under this Guaranty.

 

Guarantor
unconditionally and irrevocably waives each and every defense and setoff of any
nature which, under principles of guaranty or otherwise, would operate to
impair or diminish in any way the obligation of Guarantor under this Guaranty,
and acknowledge that each such waiver is by this reference incorporated into
each security agreement, collateral assignment, pledge and/or other document
from Guarantor now or later securing this Guaranty and/or the Indebtedness, and
acknowledge that as of the date of this Guaranty no such defense or setoff
exists.

 

9.                                      WAIVER
OF SUBROGATION:  Guarantor waives any
and all rights (whether by subrogation, indemnity, reimbursement, or otherwise)
to recover from Borrower any amounts paid by Guarantor pursuant to this
Guaranty until the Indebtedness has been paid in full.

 

10.                               SALE/ASSIGNMENT:  Guarantor acknowledges that Lender has the
right to sell, assign, transfer, negotiate, or grant participations in all or
any part of the Indebtedness and any related obligations, including, without
limit, this Guaranty, without notice to Guarantor and that Lender may disclose
any documents and information which Lender now has or later acquires relating to
Guarantor or to Borrower or the Indebtedness in connection with such sale,
assignment, transfer, negotiation, or grant. Guarantor agrees that Lender may
provide information relating to this Guaranty or relating to Guarantor to Lender’s
parent, affiliates, subsidiaries and service providers.

 

11.                               GENERAL:  This Guaranty constitutes the entire
agreement of Guarantor and Lender with respect to the subject matter of this
Guaranty. No waiver, consent, modification or change of the terms of this
Guaranty shall bind any of Guarantor or Lender unless in writing and signed by
the waiving party or an authorized officer of the waiving party, and then this
waiver, consent, modification or change shall be effective only in the specific
instance and for the specific purpose given. This Guaranty shall inure to the
benefit of Lender and its successors and assigns and shall be binding on
Guarantor and Guarantor’s successors and assigns including, without limit, any
debtor in possession or trustee in bankruptcy for any of Guarantor. Guarantor
has knowingly and voluntarily entered into this Guaranty in good faith for the
purpose of inducing Lender to extend credit or make other financial
accommodations to Borrower. If any provision of this Guaranty is unenforceable
in whole or in part for any reason, the remaining provisions shall continue to
be effective. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN 

 

5

 

ACCORDANCE
WITH THE INTERNAL LAWS OF THE STATE OF TEXAS, WITHOUT REGARD TO CONFLICT OF
LAWS PRINCIPLES.

 

12.                               HEADINGS:  Headings in this Guaranty are included for
the convenience of reference only and shall not constitute a part of this
Guaranty for any purpose.

 

13.                               COVENANTS
OF GUARANTOR:

 

(a)                                  The
following terms shall have the meanings set forth below:

 

“Debt” shall
mean, as of any applicable date of determination thereof, all items of
indebtedness, obligation or liability of Guarantor whether matured or
unmatured, liquidated or unliquidated, direct or indirect, absolute or
contingent, joint or several, that should be classified as liabilities in
accordance with GAAP.

 

“Debt-to-Asset Ratio”
shall mean, in respect of Guarantor and as of any applicable date of
determination thereof, the ratio of (i) the Debt of Guarantor at such time to
(ii) the net book value of all assets of Guarantor after all appropriate
deductions in accordance with GAAP (including, without limitation, reserves for
doubtful receivables, obsolescence, depreciation and amortization) at such
time.

 

“GAAP” shall
mean generally accepted accounting principles consistently applied.

 

“Net Worth”
shall mean, with respect to Guarantor, and as to any applicable date of
determination, the excess of (i) the net book value of all assets of Guarantor
after all appropriate deductions in accordance with GAAP (including, without
limitation, reserves for doubtful receivables, obsolescence, depreciation and
amortization), over (ii) all Debt of Guarantor at such time.

 

(b)                                 Until all Indebtedness is fully and finally
paid and discharged and all agreements and obligations, if any, of Lender to
extend credit or make other financial accommodations to Borrower are terminated
(including, without limitation, any credit facility made available by Lender to
Borrower even if loans or advances thereunder shall be optional or
non-obligatory), Guarantor covenants and agrees that Guarantor (i) shall
maintain a Net Worth at all times of no less than Fifty Million Dollars ($50,000,000);
and (ii) shall maintain a Debt-to-Asset Ratio at all times of not more than
0.65:1.

 

14.                               COUNTERPARTS.
This Guaranty may be executed in
any number of counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which
when taken together shall constitute a single agreement.

 

15.                               JURY
TRIAL WAIVER:  GUARANTOR AND LENDER, BY
ACCEPTANCE OF THIS GUARANTY, ACKNOWLEDGE THAT THE RIGHT TO TRIAL BY JURY IS A
CONSTITUTIONAL ONE, BUT THAT IT MAY BE WAIVED. EACH PARTY, AFTER CONSULTING (OR
HAVING HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL OF THEIR CHOICE, KNOWINGLY
AND VOLUNTARILY, AND FOR THEIR MUTUAL BENEFIT WAIVES ANY RIGHT TO TRIAL BY JURY
IN THE EVENT OF LITIGATION REGARDING THE PERFORMANCE OR ENFORCEMENT OF, OR IN
ANY WAY RELATED TO, THIS GUARANTY OR THE INDEBTEDNESS.

 

6

 

16.                               THIS
WRITTEN LOAN AGREEMENT (AS DEFINED BY SECTION 26.02 OF THE TEXAS BUSINESS AND
COMMERCE CODE) 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 OR ORAL AGREEMENTS BETWEEN
THE PARTIES.

 

IN WITNESS WHEREOF, Guarantor
has signed and delivered this Guaranty the day and year first written above.

 

 

	
   

  	
  BEHRINGER
  HARVARD OPPORTUNITY REIT I, INC.

  
	
   

  	
  a Maryland
  corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gerald J.
  Reihsen, III

  	
   

  
	
   

  	
   

  	
  Gerald J. Reihsen, III

  
	
   

  	
   

  	
  Executive Vice President – Corporate Development

  
	
   

  	
   

  	
  & Legal and Secretary

  

 

 

	
  STATE OF TEXAS

  	
  §

  
	
   

  	
  §

  
	
  COUNTY OF DALLAS

  	
  §

  

 

 

This
instrument was acknowledged before me on August 2, 2007 by Gerald J. Reihsen,
III, the Executive Vice President – Corporate Development & Legal and
Secretary BEHRINGER HARVARD OPPORTUNITY REIT I, INC., a Maryland corporation, on behalf of said
corporation.

 

	
   

  	
   /s/ Catherine E. Mea

  	
   

  
	
   

  	
  Notary Public, State of
  Texas

  
	
   

  	
   

  
	
   

  	
  My Commission Expires:

  	
  7/26/08

  	
   

  
	
   

  	
   

  
	
   

  	
  Printed Name of Notary:

  	
  Catherine E. Mea

  	
   

  
					

 

7Exhibit 10.96

 

AMENDED AND RESTATED

 

LOAN AGREEMENT

 

 

TABLE OF CONTENTS

 

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE I. DEFINITION OF TERMS

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
  1.1.

  	
   

  	
  Definitions

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
  1.2.

  	
   

  	
  Terms
  Generally

  	
  10

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  II. THE TERM LOAN

  	
  10

  
	
   

  	
   

  	
   

  	
   

  
	
  2.1.

  	
   

  	
  Agreement
  to Lend

  	
  10

  
	
   

  	
   

  	
   

  	
   

  
	
  2.2.

  	
   

  	
  The
  Term Note and Security

  	
  11

  
	
   

  	
   

  	
   

  	
   

  
	
  2.3.

  	
   

  	
  Reason
  for Advances

  	
  11

  
	
   

  	
   

  	
   

  	
   

  
	
  2.4.

  	
   

  	
  Term
  Loan Allocations; Approved Budget

  	
  11

  
	
   

  	
   

  	
   

  	
   

  
	
  2.5.

  	
   

  	
  Limitation
  on Advances

  	
  12

  
	
   

  	
   

  	
   

  	
   

  
	
  2.6.

  	
   

  	
  Term
  of Term Loan

  	
  12

  
	
   

  	
   

  	
   

  	
   

  
	
  2.7.

  	
   

  	
  Extension
  of Term Loan Maturity Date

  	
  12

  
	
   

  	
   

  	
   

  	
   

  
	
  2.8.

  	
   

  	
  Interest
  Rate Reductions

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
  2.9.

  	
   

  	
  Required
  Principal Payment

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
  2.10.

  	
   

  	
  Mandatory
  Prepayments – Loan Balancing

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
  2.11.

  	
   

  	
  Appraisals

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  III. REVOLVING LINE OF CREDIT

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
  3.1.

  	
   

  	
  Agreement
  to Lend

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
  3.2.

  	
   

  	
  The
  Revolver Note and Security

  	
  14

  
	
   

  	
   

  	
   

  	
   

  
	
  3.3.

  	
   

  	
  Reason
  for Advances

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  3.4.

  	
   

  	
  Limitation
  on Advances

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  3.5.

  	
   

  	
  Term
  of Revolving Line of Credit

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  3.6.

  	
   

  	
  Mandatory
  Prepayments – Loan Balancing

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  IV. ADVANCES

  	
  15

  
	
   

  	
   

  	
   

  
	
  4.1.

  	
   

  	
  Initial
  Conditions

  	
  15

  
							

 

i

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  4.2.

  	
   

  	
  Conditions
  to Advances

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
  4.3.

  	
   

  	
  Application
  for Advance is a Representation

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
  4.4.

  	
   

  	
  Advance
  Not A Waiver

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
  4.5.

  	
   

  	
  Borrower’s
  Reserve

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
  4.6.

  	
   

  	
  Advance
  Not An Approval

  	
  17

  
	
   

  	
   

  	
   

  	
   

  
	
  4.7.

  	
   

  	
  Time
  and Place of Advances

  	
  17

  
	
   

  	
   

  	
   

  	
   

  
	
  4.8.

  	
   

  	
  No
  Third Party Beneficiaries

  	
  17

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  V. WARRANTIES AND REPRESENTATIONS

  	
  18

  
	
   

  	
   

  
	
  5.1.

  	
   

  	
  Organization;
  Powers

  	
  18

  
	
   

  	
   

  	
   

  	
   

  
	
  5.2.

  	
   

  	
  Authorization;
  Enforceability

  	
  18

  
	
   

  	
   

  	
   

  	
   

  
	
  5.3.

  	
   

  	
  Governmental
  Approvals; No Conflicts

  	
  18

  
	
   

  	
   

  	
   

  	
   

  
	
  5.4.

  	
   

  	
  Mortgaged
  Property Matters

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
  5.5.

  	
   

  	
  Litigation
  Matters

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
  5.6.

  	
   

  	
  Compliance
  With Laws and Agreements

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
  5.7.

  	
   

  	
  Investment
  and Holding Company Status

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
  5.8.

  	
   

  	
  Taxes

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
  5.9.

  	
   

  	
  ERISA

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
  5.10.

  	
   

  	
  Disclosure

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
  5.11.

  	
   

  	
  Margin
  Regulations

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
  5.12.

  	
   

  	
  Environmental
  Representations

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
  5.13.

  	
   

  	
  Solvency

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  5.14.

  	
   

  	
  Business
  Loans

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  5.15.

  	
   

  	
  No
  Mechanics’ Lien Inception

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  5.16.

  	
   

  	
  Disclaimer
  of Permanent Financing

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  5.17.

  	
   

  	
  Interstate
  Land Sales Act

  	
  21

  

 

ii

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  5.18.

  	
   

  	
  Not
  a Broker Or Dealer

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  5.19.

  	
   

  	
  Good
  Title

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  5.20.

  	
   

  	
  Frisco
  Square Development Agreement

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  5.21.

  	
   

  	
  Survival
  of Representations and Warranties

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  VI. AFFIRMATIVE COVENANTS OF BORROWER

  	
  22

  
	
   

  	
   

  
	
  6.1.

  	
   

  	
  Payment
  of Fees

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  6.2.

  	
   

  	
  Notices
  of Material Events

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  6.3.

  	
   

  	
  Existence

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  6.4.

  	
   

  	
  Payment
  of Obligations

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  6.5.

  	
   

  	
  Books
  and Records; Inspection Rights

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  6.6.

  	
   

  	
  Compliance
  With Laws

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
  6.7.

  	
   

  	
  Further
  Assurances

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
  6.8.

  	
   

  	
  Advances

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
  6.9.

  	
   

  	
  Reporting
  Requirements

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
  6.10.

  	
   

  	
  Insurance

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
  6.11.

  	
   

  	
  Liquidity
  Requirement

  	
  25

  
	
   

  	
   

  	
   

  	
   

  
	
  6.12.

  	
   

  	
  Estoppel
  Certificates

  	
  25

  
	
   

  	
   

  	
   

  	
   

  
	
  6.13.

  	
   

  	
  Brokers

  	
  25

  
	
   

  	
   

  	
   

  	
   

  
	
  6.14.

  	
   

  	
  Bonding
  Off Liens

  	
  26

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  VII. NEGATIVE COVENANTS

  	
  26

  
	
   

  	
   

  
	
  7.1.

  	
   

  	
  Fundamental
  Changes

  	
  26

  
	
   

  	
   

  	
   

  	
   

  
	
  7.2.

  	
   

  	
  Investments,
  Loans, Advances, Guarantees and Acquisitions

  	
  26

  
	
   

  	
   

  	
   

  	
   

  
	
  7.3.

  	
   

  	
  Hedging
  Agreements

  	
  26

  
	
   

  	
   

  	
   

  	
   

  
	
  7.4.

  	
   

  	
  Transaction
  With Affiliates

  	
  26

  
	
   

  	
   

  	
   

  	
   

  
	
  7.5.

  	
   

  	
  ERISA
  Plan Assets

  	
  27

  

 

iii

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  7.6.

  	
   

  	
  Restricted Payments

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
  7.7.

  	
   

  	
  Debt

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
  7.8.

  	
   

  	
  Frisco Square Development Agreement

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
  7.9.

  	
   

  	
  Frisco MMD Board

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
  7.10.

  	
   

  	
  Application of Advances

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII. EVENTS OF DEFAULT

  	
  27

  
	
   

  	
   

  
	
  8.1.

  	
   

  	
  Events of Default

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
  8.2.

  	
   

  	
  Remedies

  	
  30

  
	
   

  	
   

  	
   

  	
   

  
	
  8.3.

  	
   

  	
  Late Charge

  	
  30

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX. PARTIAL RELEASES

  	
  31

  
	
   

  	
   

  
	
  9.1.

  	
   

  	
  Conditions of Partial Releases

  	
  31

  
	
   

  	
   

  	
   

  	
   

  
	
  9.2.

  	
   

  	
  Application of Partial Release Price

  	
  33

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X. MISCELLANEOUS

  	
  33

  
	
   

  	
   

  
	
  10.1.

  	
   

  	
  No Obligation by Lender to Construct

  	
  33

  
	
   

  	
   

  	
   

  	
   

  
	
  10.2.

  	
   

  	
  No Obligation by Lender to Operate

  	
  33

  
	
   

  	
   

  	
   

  	
   

  
	
  10.3.

  	
   

  	
  Expenses

  	
  34

  
	
   

  	
   

  	
   

  	
   

  
	
  10.4.

  	
   

  	
  Waivers; Amendments

  	
  34

  
	
   

  	
   

  	
   

  	
   

  
	
  10.5.

  	
   

  	
  Counterparts; Effectiveness; Joint and Several

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
  10.6.

  	
   

  	
  Severability

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
  10.7.

  	
   

  	
  Right of Setoff

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
  10.8.

  	
   

  	
  No Agency

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
  10.9.

  	
   

  	
  Successors and Assigns

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
  10.10.

  	
   

  	
  Survival

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
  10.11.

  	
   

  	
  Governing Law; Jurisdiction; Consent to Service of
  Process

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
  10.12.

  	
   

  	
  Notices

  	
  36

  

 

iv

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  10.13.

  	
   

  	
  Reliance by Lender

  	
  36

  
	
   

  	
   

  	
   

  	
   

  
	
  10.14.

  	
   

  	
  Participations

  	
  37

  
	
   

  	
   

  	
   

  	
   

  
	
  10.15.

  	
   

  	
  Usury Savings Clause

  	
  37

  
	
   

  	
   

  	
   

  	
   

  
	
  10.16.

  	
   

  	
  Controlling Document

  	
  37

  
	
   

  	
   

  	
   

  	
   

  
	
  10.17.

  	
   

  	
  Waiver Of Right To Trial By Jury

  	
  37

  
	
   

  	
   

  	
   

  	
   

  
	
  10.18.

  	
   

  	
  Entire Agreement

  	
  38

  
	
   

  	
   

  	
   

  	
   

  
	
  10.19.

  	
   

  	
  Restatement

  	
  38

  

 

v

 

AMENDED AND RESTATED

 

LOAN AGREEMENT

 

This AMENDED AND
RESTATED LOAN AGREEMENT (“Agreement”)
is made and entered into effective as of the 10th day of March, 2006
(the “Effective Date”), by and
between FRISCO SQUARE LAND, LTD.,
a Texas limited partnership (“Borrower”),
whose address is 16250 Dallas Parkway, Suite 102, Dallas, Texas 75248, and COMERICA BANK (“Lender”) whose address is 1601 Elm Street, Dallas, Texas
75201/ P.O. Box 650282, Dallas, Texas 75265-0282, Attention Commercial Lending
Services, Mail Code 6514.

 

RECITALS:

 

A.        Borrower and Lender are
parties to that certain Loan Agreement dated April 15, 2005 with respect to a
$27,664,000.00 loan from Lender to Borrower secured by, among other things, a
first lien deed of trust on land owned by Borrower in Frisco, Texas (the “Original Agreement”).

 

B.         Borrower and Lender wish
to amend and restate the Original Loan Agreement to reduce the original loan
made thereunder from $27,664,000.00 to $26,664,000.00 and to add a revolving
line of credit in the amount of $2,000,000.00.

 

NOW, THEREFORE, in
consideration of the premises and other good and valuable consideration, the
sufficiency of which is hereby acknowledged, Borrower and Lender agree that the
Original Agreement is hereby amended and restated in its entirety as follows:

 

ARTICLE I. 

DEFINITION OF TERMS

 

1.1.      Definitions.   As
used in this Agreement, the following terms shall have the respective meanings
indicated below:

 

Advance:
A disbursement by Lender, whether by journal entry, deposit to Borrower’s
account, check to third party or otherwise of any of the proceeds of either of
the Loans or any insurance proceeds.

 

Affiliate:
Any Person directly or indirectly controlling, controlled by or under common
control with any other Person. For purposes of this definition, “control” (including “controlled by” and “under common control with”) means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of any indicia of equity rights (whether issued and outstanding
capital stock, partnership interests or otherwise) or by any other means.

 

Agreement:
This Loan Agreement, together with all exhibits and schedules, as it may from
time to time be amended, modified, restated or supplemented.

 

Application
for Advance: A written application by Borrower (and such
other parties as Lender may require) in form as required by Lender, addressed
and delivered to Lender, requesting an Advance, which shall include such other
documentation as Lender may require.

 

1

 

Appraisal
Fee: Such costs or fees as may be incurred by Lender for
any appraisal which Lender may require or obtain with respect to any collateral
for the Loans.

 

Approved
Budget: The allocation of Advances under the Term Loan
for specified purposes as set forth in Exhibit A attached hereto.

 

Business
Day: Any day, other than a Saturday, Sunday or holiday,
on which Lender is open to carry on all or substantially all of its normal
commercial lending business in Dallas, Texas.

 

Borrower’s
General Partner: Fairways FS Land, LLC, a Texas limited
liability company.

 

Change
in Control: The occurrence of any one or more of the
following: (i) Borrower’s General Partner shall cease to own, directly, all of
the general partner’s interests of Borrower; or (ii) Guarantors shall cease to
own, directly, all of the membership interests of Borrower’s General Partner.

 

City:
The City of Frisco, Texas.

 

Constituent
Party: Any general partner or managing member of any
Obligor.

 

Contingent
Liability Summary: A summary in the form attached hereto
as Exhibit C to be completed and delivered by Guarantors as provided in Section
6:9(j) with respect to all Debt of the Guarantors other than under the MMD
Guaranty.

 

Debt:
Collectively, (a) all items which in accordance with Good Accounting Practice
would be included on the liability side of a balance sheet on the date as of
which Debt is to be determined (excluding capital stock, surplus, surplus
reserves and deferred credits), (b) guaranties (including without limitation,
the MMD Guaranty and Borrower’s obligations to make the MMD Payments),
endorsements and other contingent obligations in respect of Debt of others, or
any obligations to purchase or otherwise acquire any such Debt of others, and
(c) Debt secured by any mortgage, pledge, security interest or lien existing on
property owned subject to or burdened by such mortgage, pledge, security
interest or lien whether or not the Debt secured thereby shall have been
assumed; provided, however, that such term shall not mean or include any Debt
for which monies sufficient to fully pay and discharge such Debt (either on its
stated final maturity date or on such earlier date as such Debt may be duly
called for redemption and payment) are on deposit with a depository, agency or
trustee in trust for the payment of such Debt.

 

Debtor
Relief Laws: Title 11 of the United States Code, as now
or hereafter in effect, together with any other applicable law, domestic or
foreign, as now or hereafter in effect, relating to bankruptcy, insolvency,
liquidation, receivership, reorganization, rearrangement or recomposition,
extension or adjustment of debts, and any other similar laws affecting the
rights of creditors.

 

Deed
of Trust: That certain Amended and Restated Deed of
Trust, Security Agreement and Assignment of Rents dated of even date herewith
pursuant to which Borrower grants a Lien on the real and personal property more
particularly described therein and situated in the City of

 

2

 

Frisco, Collin County,
Texas as security for all or any portion of the Indebtedness evidenced by the
Notes, as the same may be renewed, extended, restated, supplemented, increased,
amended or modified from time to time.

 

Default:
Any event or condition which constitutes an Event of Default or which upon
notice, lapse of time or both would, unless cured or waived, become an Event of
Default.

 

Document
Preparation Fee: The fees and expenses of counsel to
Lender, together with any special costs incurred by Lender, with respect to the
Loans and the preparation of the Loan Documents including, this Agreement.

 

Environmental
Law: All federal, state, or local laws, statutes,
ordinances and regulations, whether now existing or hereafter in effect,
pertaining to health, industrial hygiene, or the environmental conditions on,
under, or about the Mortgaged Property, including without limitation, the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
42 U.S.C. § 9601 et seq. (“CERCLA”),
the Resource Conservation and Recovery Act, 42 U.S.C. § 6901, et seq. (“RCRA”), the Clean Water Act, 33 U.S.C. 

§ 1251 et seq. (“CWA”),
the Clean Air Act, 42 U.S.C. § 7401 et seq. (“CAA”), the Federal Water Pollution Control Act, 33 U.S.C.

§ 1251 et seq. and any corresponding state laws or ordinances, the Texas Water
Code § 26.001 et seq. (“TWC”),
the Texas Solid Waste Disposal Act, Texas Health & Safety Code § 361.001 et seq. (“THSC”), and regulations, rules,
guidelines and/or standards promulgated pursuant to such laws, statutes and
regulations, as such statutes, regulations, rules, guidelines, and standards
are amended from time to time.

 

Environmental
Claim: Any third party (including Governmental
Authorities and employees) action, lawsuit, claim or proceeding (including
claims or proceedings at common law or under the Occupational Safety and Health
Act or similar laws relating to safety of employees) which seeks to impose
liability for (i) noise; (ii) pollution or contamination of the air, surface
water, ground water or land or the clean-up of such pollution or contamination;
(iii) solid, gaseous or liquid waste generation, handling, treatment, storage,
disposal or transportation; (iv) exposure to Hazardous Substances; (v) the
safety or health of employees or (vi) the manufacture, processing, distribution
in commerce or use of Hazardous Substances. An “Environmental Claim” includes a common law action, as well
as a proceeding to issue, modify or terminate an Environmental Permit, or to
adopt or amend a regulation to the extent that such a proceeding attempts to redress
violations of an applicable permit, license, or regulation as alleged by any
Governmental Authority.

 

Environmental
Liabilities: All liabilities arising from any
Environmental Claim, Environmental Permit or Requirement of Environmental Law
under any theory of recovery, at law or in equity, and whether based on
negligence, strict liability or otherwise, including remedial, removal,
response, abatement, restoration (including natural resources), investigative,
monitoring, personal injury and damage to Property or natural resources or
injuries to persons, and any other related costs, expenses, losses, damages,
penalties, fines, liabilities and obligations, and all costs and expenses
necessary to cause the issuance, reissuance or renewal of any Environmental
Permit, including reasonable attorneys’ fees and court costs.

 

Environmental
Matters: All matters relating to pollution or protection
of the environment, including emissions, discharges, releases or threatened
releases of Hazardous Substances into the environment (including ambient air,
surface water or ground water, 

or land

 

3

 

surface or subsurface),
or otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of Hazardous Substances.

 

Environmental
Permit: Any permit, license, approval or other
authorization under any applicable Governmental Requirement relating to
pollution or protection of health or the environment, including laws, regulations
or other requirements relating to emissions, discharges, releases or threatened
releases of pollutants, contaminants or hazardous substances or toxic materials
or wastes into ambient air, surface water, ground water or land, or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of pollutants, contaminants or Hazardous
Substances.

 

ERISA:
The Employee Retirement Income Security Act of 1974, as amended from time
to time.

 

Event
of Default: Any event, happening or occurrence described
in Section 8.1 of this Agreement.

 

Extension
Fee: A fee in the amount of $66,660.00 (0.25% of the
Maximum Term Loan Commitment).

 

Extension
Prepayment: A payment of principal on the Term Note, in
the amount of $2,666,400.00 (10% of Maximum Term Loan Commitment), together
with any accrued but unpaid interest on such principal. The amount of an
Extension Prepayment is subject to reduction in accordance with the provisions
of Section 2.7(b).

 

Financing
Statements: All Uniform Commercial Code financing
statements and continuation statements as Lender shall require, duly executed
(if applicable) by Borrower or others to give notice of and to perfect or
continue perfection of Lender’s security interest in all personal property and
fixtures constituting a part of the Mortgaged Property.

 

Frisco
Square Affiliate: Any Affiliate of Borrower now or at any
time hereafter owning record title to any of the Frisco Square Property.

 

Frisco
Square Development Agreement: The Frisco Square
Development Agreement executed by and between “Five Star” as hereinafter
defined and the City dated July 28, 2000 and recorded in Volume 4721, Book 2665
of the real property records of Collin County, Texas, as the same may be
amended from time to time with Lender’s consent. “Five Star” is defined under
such agreement as “Frisco Square, Ltd., a Texas limited partnership, and its
general partner Five Star Development Co., a Texas corporation. All of Five
Star’s interests under the Frisco Square Development Agreement have been
assigned to Borrower pursuant to that certain Assignment and Assumption
Agreement, dated contemporaneously with the Original Agreement, by and between
Frisco Square, Ltd, as assignor, and Borrower, as assignee.

 

Frisco
MMD: Frisco Square Management District, a special
district created and operating under the laws of the State of Texas, including
particularly Chapter 376, Subchapter K, Section 376.451 - Section 376.476 of
the Texas Local Government Code.

 

4

 

Frisco
Square Property: An approximately 114.8298 acre tract of
land situated in the City of Frisco, Collin County, Texas that is covered by
the Frisco Square Development Agreement and included within the Frisco MMD.

 

Good
Accounting Practice:  Such accounting practice as, in the
opinion of independent accountants of recognized national standing regularly
retained by Borrower or other Person (as the case may be) and acceptable to and
approved by Lender, conforms at the time to generally accepted accounting principles,
consistently applied. Generally accepted accounting principles means those
principles and practices (a) which are recognized as such by the Financial
Accounting Standards Board, (b) applied after the date of Borrower’s or other
Person’s (as the case may be) most recently audited financial statements furnished
to Lender in a manner consistent with the manner in which such principles and
practices were applied to such statements, and (c) consistently applied for all
periods after the date of such most recent audited financial statements so as
to reflect properly the financial condition, and results of operations and
changes in financial position, of such Person. If any change in any accounting
principle or practice is required by the Financial Accounting Standards Board
in order for such principle or practice to continue as a generally accepted
accounting principle, all reports and financial statements required hereunder
may be prepared in accordance with such change only after written notice of such
change is given to Lender.

 

Governmental
Authority: The government of the United States of
America, any other nation or any political subdivision thereof, whether state
or local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.

 

Governmental
Requirements: All statutes, laws, ordinances,
requirements, judgments, rules, regulations, orders, writs, injunctions or
decrees (or interpretations of any of the foregoing) of, and the terms of any
license or permit issued by, any Governmental Authority, whether presently
existing or arising in the future. The term “Governmental
Requirements” includes all requirements of Environmental Law.

 

Guarantors
(individually and/or collectively as the context may require):
James C. Leslie, Cathy R. Sweeney, A. Brant Bryan and David F. Stringfield and
any other Person who shall, at any time, guarantee or otherwise be or become
obligated for the payment or performance of any part of the Indebtedness;
provided, however, that the term “Guarantors”
shall not include any of the Limited Guarantors.

 

Guaranty
(individually and/or collectively as the context may require):
That or those instruments of guaranty now or hereafter in effect from
Guarantors to Lender evidencing such Guarantor’s obligation to repay and/or
perform the Indebtedness.

 

Hazardous
Substance: Any substance, product, waste, or other
material which is or becomes listed, regulated, or addressed as being a toxic,
hazardous, polluting, or similarly harmful substance under any Environmental
Law, including without limitation: (i) any substance included within the
definition of “hazardous waste” pursuant to Section 1004 of RCRA; (ii) any
substance included within the definition of “hazardous substance” pursuant to
Section 101 of CERCLA; (iii) any substance included within the definition of “regulated
substance” pursuant to Section 26.342(9) of TWC; (iv) any substance included
within the definition of “hazardous

 

5

 

substance” pursuant to
Section 361.003(13) of THSC; (v) asbestos; (vi) polychlorinated biphenyls;
(vii) petroleum products; (viii) underground storage tanks, whether empty,
filled or partially filled with any substance; (ix) any radioactive materials,
urea formaldehyde foam insulation, radon; and (x) any other chemical, material
or substance the exposure to which is prohibited, limited or regulated by any
governmental authority on the basis that such chemical, material or substance
is toxic, hazardous or harmful to human health or the environment.

 

Highest
Lawful Rate: On any day, the maximum nonusurious rate of
interest permitted for that day by whichever of applicable federal or Texas law
permits the higher interest rate, stated as a rate per annum. On each day, if
any, that applicable Texas law establishes the Highest Lawful Rate, the Highest
Lawful Rate shall be the “weekly ceiling” (as defined in §303 of the Texas
Finance Code — the “Texas Finance Code,”  — as amended) for that day. Lender may
from time to time, as to current and future balances, implement any other
ceiling under the Texas Finance Code by notice to Borrower, if and to the extent
permitted by, the Texas Finance Code.

 

Indebtedness:
All indebtedness and other obligations to Lender incurred under or evidenced by
the Loan Documents.

 

Indemnified
Party: Each of the following: Lender, Lender’s
Affiliates, and their respective shareholders, directors, officers, agents,
attorneys, advisors and employees.

 

Initial
Appraisal: The appraisal of the Mortgaged Property
obtained by Lender prior to the execution of the Original Agreement in
connection with Lender’s underwriting of the Term Loan.

 

Initial
Appraised Value: The value of the Mortgaged Property as
determined by the Initial Appraisal. Exhibit B attached hereto sets
forth the allocations of value for each of the parcels comprising the Mortgaged
Property.

 

Lien:
Any interest in any property, whether real, personal or mixed, securing an
indebtedness, obligation or liability owed to or claimed by any person, other
than the owner of such property, whether such indebtedness is based on the
common law or any statute or contract and including, but not limited to, a
security interest, pledge, mortgage, assignment, conditional sale, trust
receipt, lease, consignment or bailment for security purposes.

 

Limited
Guarantors: Joseph Cole McDowell, Jr. (a/k/a Cole
McDowell) and Five Star Development Co., Inc., a Texas corporation.

 

Limited
Guaranty: The Guaranty in favor of Lender executed
contemporaneously with the Original Agreement by Limited Guarantors.

 

Loans:
The Term Loan and the Revolving Line of Credit

 

Loan
Documents: This Agreement, the Term Note, the Revolver
Note, the Deed of Trust, the Financing Statement, the Guaranty, if any, each
Application for Advance and all other instruments now or hereafter executed (a)
pursuant to this Agreement or in connection with this Agreement or the Indebtedness
or (b) as security for either or both payment of the Indebtedness or
performance of Borrower’s obligations under this Agreement or under any other
Loan

 

6

 

Document, and all
amendments, modifications, renewals, extensions, increases and rearrangements
of, and substitutions for, any of the foregoing.

 

Loan
to Value Ratio: A ratio calculated by dividing (i) the
sum of the then outstanding balance of the Indebtedness plus (A) any amounts of
the Term Loan which have not yet been advanced and (B) the Maximum RLOC
Commitment less any Advances that have been made under the Revolving Line of
Credit that have not been repaid, by (ii) the fair market value of the
Mortgaged Property as determined by the most current appraisal obtained by
Lender (subject to Section 3.4 below).

 

Material
Adverse Effect: A material adverse effect on (a) the
business, assets, operations, or condition, financial or otherwise, of any
Obligor; (b) the ability of any Obligor to perform any of its obligations under
the Loan Documents; or (c) the validity or enforceability of this Agreement,
the Notes or any other Loan Document or the rights or remedies of Lender under
the Loan Documents.

 

Maximum
RLOC Commitment: $2,000,000.00.

 

Maximum
Term Loan Commitment: $26,664,000.00.

 

Maximum
Total Commitment: the sum of the Maximum RLOC Commitment and
the Maximum Term Loan Commitment ($28,664,000.00).

 

MMD
Guaranty: Collectively, (i) that certain Guaranty dated
contemporaneously with the Original Agreement executed by James C. Leslie in
favor of the City; (ii) that certain Guaranty dated contemporaneously with the
Original Agreement executed by Cathy R. Sweeney in favor of the City, (iii)
that certain Guaranty dated contemporaneously with the Original Agreement
executed by A. Brant Bryan in favor of the City, and (iv) that certain Guaranty
dated contemporaneously with the Original Agreement executed by David F.
Stringfield in favor of the City.

 

MMD
Payments: The payments required to be made by Borrower pursuant
to the Frisco Square Development Agreement and MMD Guaranty with respect to the
public projects described in the Frisco Square Development Agreement, including
any payments required to be made by Borrower to repay the indebtedness issued
by the City, to finance such projects.

 

Mortgaged
Property: The term “Mortgaged Property” shall have the
meaning set forth in the Deed of Trust.

 

Notes:
The Term Note and the Revolver Note.

 

Obligors:
Borrower, any Constituent Party and any Guarantors.

 

Partial
Release Notice: A written notice requesting the release
of a Release Parcel from the lien of the Deed of Trust, which written notice
shall (i) describe the Release Parcel to be released, including a metes and
bounds description of such Release Parcel, (i) state the date such Release
Parcel is expected to be released and sold or financed, and (iii) state, if
applicable, the price for which such Release Parcel is to be sold and the
purchaser to whom such Release Parcel is to be sold; together with information
necessary for Lender to process the partial release,

 

7

 

including the name and
address of the Title Company, if any, to whose attention the partial release
instrument and instructions relating thereto should be directed, the relevant
sales contract or information on construction financing, as applicable, and the
closing statement pertaining to the applicable sale or construction financing.

 

Partial
Release Price: With respect to any Release Parcel to be
released for construction, an amount equal to 85% of the Initial Appraised
Value of such Release Parcel calculated based upon the allocations of the
Initial Appraised Value as set forth in Exhibit B attached hereto; and,
with respect to any Release Parcel to be sold to a third party, an amount equal
to the greater of (i) 100% of the net proceeds received by Borrower with
respect to such sale (“net proceeds”
as used herein shall mean the contract purchase price to be paid to Borrower
after deduction of normal and customary closing costs as approved by Lender)
and (ii) 85% of the Initial Appraised Value of such Release Parcel calculated
based upon the allocations of the Initial Appraised Value as set forth in Exhibit
B attached hereto.

 

Past
Due Rate: The lesser of (a) the Highest Lawful Rate; or
(b) the Stated Rate (as such term is defined in the Term Note or Revolver Note,
as applicable) plus an additional 5.0% per annum. The Past Due Rate shall
automatically fluctuate upward and downward as and in the amount by which the
Highest Lawful Rate or Stated Rate plus 5.0% per annum fluctuates, without
notice to Borrower or any other Person. The Past Due Rate shall be computed on
the basis of the actual number of days elapsed in a year consisting of 365 or
366 days, as the case may be.

 

PBGC:
The Pension Benefit Guaranty Corporation.

 

Person:
A natural person, a partnership, a joint venture, a corporation, a trust, a
limited liability company, an unincorporated organization and a government and
any department or agency thereof.

 

Principal
Reduction Increment: A reduction of principal on the Term
Note made by Borrower in the amount of $2,666,400.00 (10% of the Maximum Term
Loan Commitment), whether by an Extension Prepayment (each which shall be
deemed to be equal to one Principal Reduction Increment) or by the Required
Principal Payment (which shall be deemed to be two and one half Principal
Reduction Increments) or by application of a Partial Release Price or
otherwise.

 

Qualified
Loan to Value Reduction: Each 2.5% reduction of the Loan
to Value Ratio from the initial Loan to Value Ratio of 65%.

 

Release
Parcel: A portion of the Mortgaged Property designated by
Borrower either (i) which is to be sold pursuant to a bona fide contract of
sale to a third party, or (ii) upon which improvements are to be constructed by
Borrower or its Affiliate, and which otherwise satisfies all applicable
conditions and requirements therefore set forth in Section 9.1 of this
Agreement.

 

Required
Principal Payment: A payment of principal on the Term Note,
in the amount of $6,666,000.00 (25% of the Maximum Term Loan Commitment),
together with any accrued but unpaid interest on such principal.

 

8

 

Revolver
Note: The promissory note dated of even date herewith in
the original principal amount of $2,000,000.00 executed by Borrower, payable to
the order of Lender, and all renewals, extensions and rearrangements thereof
provided for in this Agreement or otherwise permitted by Lender.

 

Revolving
Line of Credit: The loan evidenced by the Revolver Note
and governed by this Agreement.

 

RLOC
Origination Fee: A fee in the amount of $10,000.00
payable upon execution of this Agreement.

 

RLOC
Maturity Date: The maturity date of the Revolver Note,
March 10, 2006, as the same may hereafter be accelerated or extended pursuant
to the provisions of the Revolver Note, this Agreement or any of the other Loan
Documents.

 

Security
Agreement: Collectively, all security agreements, whether
contained in the Deed of Trust, a separate security agreement or otherwise,
that create a security interest in, or evidence a pledge of, personal property
and/or fixtures as security for the Indebtedness.

 

Special
Account: An account established by Borrower with Lender
(in which Borrower shall at all times maintain a minimum balance of $1,000.00).

 

Term
Loan: The loan evidenced by the Term Note and governed by
this Agreement.

 

Term
Loan Commitment Fee: A fee in the amount of $33,300.00
(0.125% of the Maximum Term Loan Commitment) payable each year of the initial
36 month term of the Term Loan as provided in Section 6.1.

 

Term
Loan Maturity Date: The maturity date of the Term Note,
April 15, 2008, as the same may hereafter be accelerated or extended pursuant
to the provisions of the Term Note, this Agreement or any of the other Loan
Documents.

 

Term
Loan Origination Fee: A fee in the amount of $207,480.00
which was payable upon execution of the Original Agreement.

 

Term
Loan Repayment: A prepayment in the amount of $582,477.00
of the outstanding principal amount of the Working Capital Advances made under
the Term Loan pursuant to the terms of the Original Agreement.

 

Term
Note: The amended and restated promissory note dated of
even date herewith in the original principal amount of $26,664,000.00 executed
by Borrower, payable to the order of Lender, and all renewals, extensions and
rearrangements thereof provided for in this Agreement or otherwise permitted by
Lender.

 

Title
Insurance: A title insurance policy or policies in form
satisfactory to Lender in its sole and absolute discretion, on a coinsurance or
reinsurance basis (with direct access endorsement or rights) if and as required
by Lender, in the amount of the Maximum Total Commitment, insuring that Lender
holds a valid first and prior Lien covering the Mortgaged

 

9

 

Property, subject only to
those exceptions which Lender may approve and containing an adjustable mortgage
loan endorsement and/or such other endorsements as Lender shall require

 

Title
Company: Chicago Title Insurance Company, or other title
insurance company acceptable to Lender in its sole and absolute discretion.

 

Transactions:
The execution, delivery and performance by the Obligor and the Constituent
Parties of the Loan Documents to which they are party, the borrowing of the
Loans, the guaranty of the Indebtedness, and the use of the proceeds of the
Loans.

 

1.2.   Terms
Generally.   The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. 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); (b) any reference
herein to any Person shall be construed to include such Person’s successors and
assigns; (c) 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; (d) all references herein to Articles, Sections,
Exhibits and Schedules shall be construed to refer to Articles and Sections of,
and Exhibits and Schedules to, this Agreement; and (e) the words “asset” and “property”
shall be construed to have the same meaning and effect and to refer to any and
all tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.

 

ARTICLE
II.

THE TERM LOAN

 

2.1.   Agreement
to Lend.   (a)   Lender agrees, subject to
the terms, provisions and conditions of this Agreement, to make Advances of
proceeds of the Term Loan to Borrower prior to the Term Loan Maturity Date in
an aggregate principal amount not to exceed the Maximum Term Loan Commitment.
No portion of the principal of the Term Loan that is repaid prior to the Term
Loan Maturity Date may be reborrowed. Borrower and Lender agree pursuant to
Chapter 346 of the Texas Finance Code, that Chapter 346 (which relates to
open-end line of credit revolving loan accounts) shall not apply to this
Agreement, the Loan Documents or the Loans, and this Agreement, the Loan
Documents and the Loans shall not be governed by Chapter 346 or subject to its
provisions in any manner whatsoever. Borrower understands and agrees that
Lender IS NOT AND SHALL NEVER BE COMMITTED OR OBLIGATED IN ANY WAY TO MAKE ANY
LOAN OR ANY ADVANCE UNDER THIS AGREEMENT or any related papers, and nothing
contrary contained herein or in any of the Loan Documents or in any course of
conduct shall obligate or be construed to obligate Lender to make, or shall
entitle or be construed to entitle Borrower to receive, any Advance hereunder
unless the terms and conditions set forth in this Agreement, including without
limitation Section 4.1 and Section 4.2 hereof have been
satisfied.

 

10

 

(b)   Lender
may, in Lender’s discretion, disburse proceeds of the Term Loan by journal
entry to pay interest and financing costs and, if Lender should elect, disburse
proceeds of the Term Loan directly to third parties to pay (or directly to
Lender as reimbursement for Lender’s payment of) costs or expenses required to
be paid by Borrower pursuant to this Agreement or the other Loan Documents.
Proceeds of the Term Loan disbursed by Lender by journal entry to pay interest
or financing costs, and proceeds of the Term Loan disbursed directly to third
parties to pay (or to Lender as reimbursement for Lender’s payment of)  costs or expenses required to be paid by
Borrower pursuant to this Agreement, shall constitute Advances to Borrower.

 

2.2.   The
Term Note and Security.   Borrower shall execute and deliver
to Lender the Term Note to evidence the Term Loan. Advances of proceeds of the
Term Loan made under this Agreement shall be conclusively deemed and considered
to have been made against the Term Note. Lender shall make an appropriate
notation on its records reflecting each amount advanced against the Term Note
and the date of the Advance. Such notations made by Lender in its records shall
be prima  facie evidence of the existence and amounts of the
obligations recorded therein; provided that the failure of Lender to
maintain such records or any error therein shall not in any manner affect the
obligation of Borrower to repay the Term Loan in accordance with the terms of
this Agreement and the other Loan Documents. Interest on the amounts of
proceeds of the Term Loan advanced hereunder shall be computed on the amount of
each Advance of proceeds of the Term Loan and from the date of each such
Advance. Advances of the Term Loan shall be guaranteed by the Guaranty and
secured by the Deed of Trust and the mortgages, liens, security interests and
collateral assignments created or evidenced by the other Loan Documents.

 

2.3.   Reason
for Advances.   The Term Loan is being made solely for the
following purposes, and no other purposes: (i) to create a reserve (the “Interest Reserve”) to pay interest that
accrues on the outstanding principal balance of the Term Note as and provided
for in the Term Note (an Advance for such purposes being referred to hereunder
as an “Interest Advance”); (ii) to
pay any of the MMD Payments (an Advance for such purposes being referred to
hereunder as a “MMD Advance”); and
(iii) to pay ad valorem taxes on the Mortgaged Property (an Advance for such
purposes being referred to hereunder as a “Tax
Advance”). Under the Original Agreement, the purposes of the Term
Loan also included the Refinance Advance and Working Capital Advances (as such
terms were defined in the Original Agreement); however, the Refinance Advance
was fully funded under the Original Agreement and the allocation in the
Approved Budget for Working Capital Advances, as the same has been reduced
under this Agreement, has been fully funded under the Original Agreement and
consequently, Advances for the purposes of the Refinance Advance and Working
Capital Advances may no longer be made under the Term Loan.

 

2.4.   Term
Loan Allocations; Approved Budget.   The amounts available
under the Term Loan for Advances for the purposes specified in Section 2.3
above shall be allocated as set forth in the Approved Budget. The allocations
set forth in the Approved Budget may be modified from time upon Borrower’s
request; provided, however, that any changes in the allocation for Interest
Reserve requested by Borrower shall be made only if Lender, in Lender’s sole
discretion, approves the same. In no event shall the allocations for Interest
Advances, Tax Advances or MMD Advances in any way limit or affect Borrower’s
obligations to pay any interest on the Indebtedness, taxes affecting the
Mortgaged Property or any obligations relating

 

11

 

to the MMD and to the
extent proceeds from the Term Loan are not disbursed for, or are insufficient
for, such purposes, Borrower shall pay such expenses with funds derived from
sources other than the Loans.

 

2.5.   Limitation
on Advances.   In no event shall any Advance under the Term
Loan be made if such Advance, together with all prior Advances (whether or not
repaid) under the Term Loan, would exceed the Maximum Term Loan Commitment.

 

2.6.   Term
of Term Loan.   The term of the Term Loan shall be 36 months
from the date of the Original Agreement, unless Borrower exercises a right to
extend the Term Loan Maturity Date as provided in Section 2.7 below. In
addition to any earlier payments as may be required by this Agreement or other
Loan Documents, the entire outstanding balance of the Term Loan shall be due
and payable in full on the Term Loan Maturity Date.

 

2.7.   Extension
of Term Loan Maturity Date.   Borrower shall have two
successive options to extend the Term Loan Maturity Date for two successive
periods of 12 months each upon and subject to the following conditions:

 

(a)   Borrower
must (i) give written notice to Lender of such election to extend the Maturity
Date at least 30 days prior to the then Term Loan Maturity Date, and (ii) pay
to Lender an Extension Fee prior to the then Term Loan Maturity Date.

 

(b)   Borrower
shall make an Extension Prepayment at the time of such written notice;
provided, however, that (i) the amount of the Extension Prepayment due with
respect to the first extension option shall be reduced by an amount equal to
the amount of any Partial Release Prices received by Lender during months 25-36
of the term of the Term Loan which was applied to the principal balance of the
Term Note; and (ii) the amount of the Extension Prepayment due with respect to
the second extension option shall be reduced by an amount equal to the amount
of any Partial Release Prices received by Lender during months 37-48 of the
term of the Term Loan which was applied to the principal balance of the Term
Note.

 

(c)   The
Loan to Value Ratio at the time the first extension option is exercised must be
equal to or less than 50%; and the Loan to Value Ratio at the time the second
extension option is exercised must be equal to or less than 45%.

 

(d)   No
Material Adverse Effect shall have occurred, including without limitation, any
material adverse change to the market condition or value of the Mortgaged
Property.

 

(e)   At
Lender’s option, Lender may require a current appraisal of the Mortgaged
Property and, if required, Borrower will pay the Appraisal Fee therefore prior
to the then Term Loan Maturity Date.

 

(f)    No
Default or Event of Default shall then exist and be continuing.

 

(g)   The
amount of the undisbursed proceeds of the Term Loan allocated for Interest
Reserve in the Approved Budget, together with any amounts held in the Borrower’s
Reserve for interest on the Term Loan, shall be adequate, in Lender’s sole

 

12

 

discretion, to pay the
interest anticipated to accrue during the remainder of the term of the Term
Loan, as so extended.

 

2.8.   Interest
Rate Reductions. Borrower shall have the right to reduce the “Stated Rate”
under the Term Note from time to time subject to and upon the following
conditions:

 

(a)   The
Stated Rate shall be reduced by 0.25% for each Principal Reduction Increment
together with a Qualified Loan to Value Reduction; provided, however, in no
event shall (i) the Stated Rate ever be less than zero; or (ii) the Stated Rate
on the Prime Rate Balance (as defined in the Term Note) ever be less than the
Prime Rate minus 0.75% or (iii) the Stated Rate on any Eurodollar Balance ever
be less than the applicable Eurodollar Rate (as defined in the Term Note) plus
2%.

 

(b)   Any
decrease in Stated Rate shall take effect five Business Days after Borrower
delivers an Interest Notice (as defined in the Term Note) to Lender, which
Interest Notice includes a written request for such reduction unless Lender
determines and notifies Borrower within such five Business Day period that the
conditions for such reduction set forth in this provision have not been
satisfied.

 

2.9.   Required
Principal Payment. Borrower shall make the Required Principal Payment on or
prior to the last day of the 24th month of the term of the Term
Loan; provided, however that (i) the amount of the Required Principal Payment
due shall be reduced by an amount equal to the amount of any Partial Release
Prices received by Lender during the first 24 months of the term of the Term
Loan which was applied to the principal balance of the Term Note, and (ii) if
necessary, the Required Principal Payment due shall be increased so that the
Loan to Value Ratio is equal to or less than 55%.

 

2.10.   Mandatory
Prepayments – Loan Balancing.   To the extent, for whatever
reason, the outstanding principal balance of the Term Note should ever exceed
the Maximum Term Loan Commitment, Borrower shall immediately prepay principal
on the Term Note, together with accrued but unpaid interest on such principal,
in an amount equal to the excess.

 

2.11.   Appraisals.   Lender
may obtain from time to time, at Borrower’s expense (but no more frequently
than annually), current appraisals of the Mortgaged Property or other
collateral for the Loans to verify that the value of the Mortgaged Property or
such other collateral is no less than that originally approved by Lender. If
the Loan to Value Ratio decreases as a result of any such appraisals obtained
by Lender, Borrower shall have the right, at Borrower’s expense, to obtain its
own appraisal prepared by another appraiser acceptable to Lender and, for
purposes of the determination of the then Loan to Value Ratio, the fair market
value of the Mortgaged Property shall be the average of the most current
appraisal obtained by Lender and the appraisal obtained by Borrower as provided
in this sentence.

 

ARTICLE III.

REVOLVING LINE OF CREDIT

 

3.1.   Agreement
to Lend.   (a)   Lender agrees, subject to
the terms, provisions and conditions of this Agreement, to make Advances of
proceeds of the Revolving Line of Credit to Borrower prior to the RLOC Maturity
Date. The aggregate amount of Advances at any one time outstanding shall not
exceed the Maximum RLOC Commitment. All of such Advances shall be

 

13

 

evidenced by the Revolver
Note, under which Advances and repayments may be made subject to the terms and
conditions of the Loan Documents. Subject to the terms and conditions of the
Loan Documents, any portion of the principal of the Revolving Line of Credit
that is repaid prior to the RLOC Maturity Date may be reborrowed prior to the
RLOC Maturity Date pursuant to the terms of this Agreement. The amount of funds
available under the Revolving Line of Credit at any time prior to the RLOC
Maturity Date subject to the terms and conditions of this Agreement shall be
determined by subtracting the amount of all outstanding Advances which have
been made under the Revolving Line of Credit as of the date of determination
from the Maximum RLOC Commitment. Borrower and Lender agree pursuant to Chapter
346 of the Texas Finance Code, that Chapter 346 (which relates to open-end line
of credit revolving loan accounts) shall not apply to this Agreement, the Loan
Documents or the Loans and this Agreement, the Loan Documents and the Loans
shall not be governed by Chapter 346 or subject to its provisions in any manner
whatsoever. Borrower understands and agrees that Lender IS NOT AND SHALL NEVER
BE COMMITTED OR OBLIGATED IN ANY WAY TO MAKE ANY LOAN OR ANY ADVANCE UNDER THIS
AGREEMENT or any related papers, and nothing contrary contained herein or in
any of the Loan Documents or in any course of conduct shall obligate or be construed
to obligate Lender to make, or shall entitle or be construed to entitle
Borrower to receive, any Advance hereunder unless the terms and conditions set
forth in this Agreement, including without limitation Section 4.1 and Section
4.2 hereof have been satisfied.

 

(b)   Borrower
acknowledges and agrees that Lender, in its sole and absolute discretion, will
make the decision as to whether any Advances under the Revolving Line of Credit
shall be made hereunder and what terms, conditions, and special stipulations,
in addition to the terms and provisions of the Loan Documents, will be
required. Borrower has no right and hereby waives, relinquishes and releases
any right that it might now or hereafter have, to demand Lender to make any
Advance under the Revolving Line of Credit.

 

(c)   Lender
may, in Lender’s discretion, disburse proceeds of the Revolving Line of Credit
by journal entry to pay interest and financing costs and, if Lender should
elect, disburse proceeds of the Revolving Line of Credit directly to third
parties to pay (or directly to Lender as reimbursement for Lender’s payment of)
costs or expenses required to be paid by Borrower pursuant to this Agreement or
the other Loan Documents. Proceeds of the Revolving Line of Credit disbursed by
Lender by journal entry to pay interest or financing costs, and proceeds of the
Revolving Line of Credit disbursed directly to third parties to pay (or to
Lender as reimbursement for Lender’s payment of) costs or expenses required to
be paid by Borrower pursuant to this Agreement, shall constitute Advances to
Borrower.

 

3.2.   The
Revolver Note and Security.   Borrower shall execute and
deliver to Lender the Revolver Note to evidence the Revolving Line of Credit.
Advances of proceeds of the Revolving Line of Credit made under this Agreement
shall be conclusively deemed and considered to have been made against the
Revolver Note. Lender shall make an appropriate notation on its records
reflecting each amount advanced against the Revolver Note and the date of the
Advance. Such notations made by Lender in its records shall be prima  facie
evidence of the existence and amounts of the obligations recorded therein; provided
that the failure of Lender to maintain such records or any error therein shall
not in any manner affect the obligation of Borrower to repay the Revolving Line
of Credit in accordance with the terms of this Agreement and the other Loan
Documents. Interest on the amounts of proceeds of the Revolving Line of Credit
advanced hereunder shall be computed on the amount

 

14

 

of each Advance of
proceeds of the Revolving Line of Credit and from the date of each such
Advance. Advances of the Revolving Line of Credit shall be guaranteed by the
Guaranty and secured by the Deed of Trust and the mortgages, liens, security
interests and collateral assignments created or evidenced by the other Loan
Documents.

 

3.3.   Reason
for Advances.   The Revolving Line of Credit is being made
solely for the following purposes, and no other purposes: (i) to make the Term
Loan Repayment concurrently with the execution of this Agreement; (ii) to pay
leasing commissions, soft costs and similar pre-construction expenses relating
to the Frisco Square Property which are expected to be reimbursed from
construction financing or other sources; and (iii) such other purposes as may
be approved by Lender in its sole and absolute discretion.

 

3.4.   Limitation
on Advances.   In no event shall any Advance of the
Revolving Line of Credit be made if such Advance, together with all prior
Advances under the Revolving Line of Credit which have not been repaid, would
exceed the Maximum RLOC Commitment.

 

3.5.   Term
of Revolving Line of Credit.   The term of the Revolving
Line of Credit shall be 12 months from the date of this Agreement. In addition
to any earlier payments as may be required by this Agreement or other Loan
Documents, the entire outstanding balance of the Revolving Line of Credit shall
be due and payable in full on the RLOC Maturity Date.

 

3.6.   Mandatory
Prepayments – Loan Balancing.   To the extent, for whatever
reason, the outstanding principal balance of the Revolver Note should ever
exceed the Maximum RLOC Commitment, Borrower shall immediately prepay principal
on the Revolver Note, together with accrued but unpaid interest on such
principal, in an amount equal to the excess.

 

ARTICLE
IV.

ADVANCES

 

4.1.   Initial
Conditions.   Lender’s execution of this Agreement and the
other Loan Documents to which it is a party shall be conditioned upon, among
other terms and conditions, the prior or simultaneous satisfaction of each of
the following:

 

(a)   Lender
shall have received from each party hereto or any other Obligor a counterpart
of this Agreement and all other Loan Documents to which it is a party, signed
on behalf of such party.

 

(b)   Unless
waived by Lender, Lender shall have received a favorable written opinion
(addressed to Lender and dated the effective date of this Agreement) of counsel
for Borrower, Guarantors and Limited Guarantors, covering such matters relating
to Borrower, Guarantors and Limited Guarantors, this Agreement or the
Transactions, as Lender shall reasonably request, and in form and substance
reasonably satisfactory to Lender.

 

(c)   Lender
shall have received such documents and certificates as Lender or its counsel
may reasonably request relating to the organization, existing and good standing
of Obligors, the authorization of the Transactions and any other legal matters
relating to Obligors, this Agreement or the Transactions, all in form and
substance reasonably satisfactory to Lender and its counsel.

 

15

 

(d)   Lender
shall have received all fees and other amounts due and payable on or prior to
the effective date of this Agreement, including, to the extent invoiced,
reimbursement or payment of all reasonable out-of-pocket expenses required to
be reimbursed or paid by Borrower hereunder.

 

4.2.   Conditions
to Advances.   The consideration by Lender to make any
Advance hereunder shall be subject to, among other terms and conditions, the
prior or simultaneous satisfaction of each of the following conditions:

 

(a)   The
Loan Documents shall be and remain valid, binding, in full force and effect and
accordance with their terms.

 

(b)   The
representations and warranties made by any Obligor or Constituent Party set
forth in this Agreement or any other Loan Document to which such Person is a
signatory shall be true and correct in all material respects on and as of the
date of such Advance.

 

(c)   Borrower
shall have fully completed (to the extent applicable), signed, notarized and
delivered to Lender an Application for Advance.

 

(d)   At
the time of and immediately after giving effect to such Advance, no Default or
Event of Default shall have occurred and be continuing.

 

(e)   Lender
shall have received such other information as Lender may request.

 

(f)  Lender
shall have received all fees and other amounts due and payable on or prior to
the date of such Advance, including, to the extent invoiced, reimbursement or
payment of all reasonable out-of-pocket expenses required to be reimbursed or
paid by Borrower hereunder.

 

4.3.   Application
for Advance is a Representation.   Each submission by
Borrower to Lender of an Application for Advance shall be deemed to constitute
a representation and warranty by Borrower on the date thereof as to the matters
specified in

Section 4.2(b) and (d) and that each of the conditions in Sections
4.1 and 4.2 shall have been satisfied.

 

4.4.   Advance
Not A Waiver.   No Advance shall constitute a waiver of any
of the conditions of Lender’s obligation to make further Advances, nor, in the
event Borrower is unable to satisfy any such condition, shall any such Advance
have the effect of precluding Lender from thereafter declaring such inability
to be an Event of Default.

 

4.5.   Borrower’s
Reserve.   At any time or from time to time, Lender, in its
sole discretion, shall have the right to request Borrower to deposit with
Lender (the “Borrower’s Reserve”)
such additional funds as Lender deems necessary or advisable to pay all or a
portion of the ad valorem taxes, insurance premiums, and other impositions
affecting the Mortgaged Property, the MMD Payments, and/or interest on the
Loans. Borrower agrees upon 15 days written demand by Lender to deposit with
Lender any such funds required by Lender to be deposited into Borrower’s
Reserve; and Lender may refuse to make any additional Advances to Borrower
hereunder until Borrower shall have deposited such funds with Lender. Any funds
in the Borrower’s Reserve will be disbursed by Lender to Borrower pursuant to
the terms and

 

16

 

conditions hereof as if
they constituted a portion of the Loans being made hereunder. After the
occurrence of an Event of Default, Lender shall have the right (but not the
obligation), at its sole discretion, to apply any or all of the Borrower’s
Reserve in payment of such ad valorem taxes, insurance premiums, and other
impositions or toward payment of the Indebtedness in such manner and order of
priority as Lender, in its sole discretion, may elect. The Borrower’s Reserve
shall be deposited into an interest bearing demand deposit account with Lender
and all interest which accrues thereon shall be added to the Borrower’s
Reserve; provided, however that Lender shall have no obligation to pay interest
on such demand deposit account any greater than the standard market rate then
provided by Lender on such accounts.

 

4.6.   Advance
Not An Approval.   Lender shall have no obligation to make
any Advance or part thereof after the happening of any Default or any Event of
Default, but shall have the right and option so to do; provided that if Lender
elects to make any such Advance, no such Advance shall be deemed to be either a
waiver of the Default or Event of Default or any right or remedy available to
Lender, including, without limitation, the right to demand payment of the
Loans, or any part thereof, or the right to withhold any future Advance.

 

4.7.   Time
and Place of Advances.   All Advances are to be made at the
office of Lender, or at such other place as Lender may designate. Borrower
shall submit an Application for Advance to Lender at least seven Business Days’
prior to the date on which the requested Advance is to be made. Except as set
forth in this Agreement, all Advances are to be made by direct deposit into the
Special Account.

 

4.8.   No
Third Party Beneficiaries.   The benefits of this Agreement
shall not inure to any third party, nor shall this Agreement be construed to
make or render Lender liable to any materialmen, subcontractors, contractors,
laborers or others for goods and materials supplied or work and labor furnished
to the Mortgaged Property or for debts or claims accruing to any such persons
or entities against Borrower. Lender shall not be liable for the manner in
which any Advances under this Agreement may be applied by Borrower.
Notwithstanding anything contained in the Loan Documents, or any conduct or
course of conduct by the parties hereto, before or after signing the Loan
Documents, this Agreement shall not be construed as creating any rights, claims
or causes of action against Lender, or any of its officers, directors, agents
or employees, in favor of any contractor, subcontractor, supplier of labor or
materials, or any of their respective creditors, or any other Person other than
Borrower.

 

4.9   Affiliate
Loans.   Borrower represents and warrants that neither
Borrower nor Borrower’s General Partner have any obligations or liabilities,
primarily or secondarily, absolute or contingent, direct or indirect, or
otherwise with respect to the loans from First National Bank of Omaha (“FNBO”) and Citibank, formerly known as
First American Bank (“Citibank”),
to Frisco Square Affiliates (“Affiliate Loans”).
Borrower agrees that unless Borrower has delivered to Lender on or before June
15, 2006, written confirmation from both FNBO and Citibank confirming that no
defaults exist under the Affiliate Loans and that the term of each of the
Affiliate Loans (has been renewed and extended, if necessary, so that it)
matures no earlier than May 1, 2007, then, at Lender’s sole option, such
failure shall constitute an Event of Default under this Agreement.

 

17

 

ARTICLE V. 

WARRANTIES AND REPRESENTATIONS

 

Borrower hereby unconditionally warrants and represents to Lender, as of
the date hereof and at all times during the term of the Agreement, as follows:

 

5.1.   Organization; Powers.   Each
Obligor and each Constituent Party (a) is duly organized, validly existing and
in good standing under the laws of the jurisdiction of its formation or
existence; (b) has all requisite corporate, limited liability company or
partnership power, as the case may be, and authority to own its properties, to
lease (as lessee) the properties that it leases as lessee, to lease or sublease
(as lessor) the properties it owns and/or leases and to carry on its business
as now or currently proposed to be conducted; and (c) except when failure to do
so could not reasonably be expected to have a Material Adverse Effect, is duly
qualified as a foreign corporation, limited liability company, general
partnership or limited partnership, as applicable, and is in good standing in,
every jurisdiction where such qualification is necessary in order to conduct
its business as now or currently proposed to be conducted. None of the Obligors
or Constituent Parties is a “foreign person” within the meaning of Section 1445
of the Code. The organizational documents of each Obligor have been delivered
to Lender prior to the date hereof or as of the date in which such Person
became a Obligor and have not been amended, modified or supplemented in any
respect, except for such amendments, modifications or supplements (i) disclosed
to Lender in writing within 30 days after the complete execution thereof and
which individually or in the aggregate could not reasonably be expected to have
a Material Adverse Effect or (ii) were otherwise consented to in advance in
writing by Lender.

 

5.2.   Authorization; Enforceability.   The
Transactions have been (or will be when required) duly authorized by all
necessary partnership, corporate and limited liability company action, as
applicable, of each Obligor and Constituent Party, and each Obligor and
Constituent Party has the requisite power and authority to execute, deliver and
perform this Agreement and the other Loan Documents to which such Person is a
signatory on its behalf or on behalf of Borrower, as applicable. This Agreement
and the other Loan Documents have been duly executed and delivered by each
Obligor and Constituent Party which is a party thereto and constitutes the
legal, valid and binding obligation of each such Person which is a party
thereto, enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other laws affecting
creditors’ rights generally and subject to general principles of equity,
regardless of whether considered in a proceeding in equity or at law.

 

5.3.   Governmental Approvals; No Conflicts.   The
Transactions (a) will not require an Obligor or Constituent Party to obtain any
consent or approval of, registration or filing with, or any other action by,
any Governmental Authority, except such as have been (or will be when required)
obtained or made and each of which are in full force and effect; (b) will not
violate any Governmental Requirement, or the provisions of any charter,
operating agreement, bylaws, partnership agreements or other organizational documents
of any Obligor or Constituent Party; (c) will not violate or result in a
default under any indenture, agreement or other instrument binding upon any
Obligor or Constituent Party, or any of their assets; and (d) will not result
in the creation or imposition of any Lien on any asset of any Obligor or
Constituent Party except for the Liens of the Deed of Trust.

 

 

18

 

5.4.   Mortgaged Property Matters.

 

(a)   To Borrower’s knowledge, no
portion of the Mortgaged Property, is dependent for its access, operation or
utility on any land, building or other improvement not included in the
Mortgaged Property, other than for access provided pursuant to a recorded
easement or other right of way establishing the right of such access.

 

(b)   Borrower has not received any
notice and has no knowledge, of any pending, threatened or contemplated
condemnation proceeding affecting any portion of the Mortgaged Property, or of
any sale or other disposition of any portion of the Mortgaged Property in lieu
of condemnation.

 

(c)   No portion of the Mortgaged
Property is located in a special flood hazard area as designated by any federal
Governmental Authorities or any area identified by the insurance industry or
other experts acceptable to Lender as an area that is a high probable
earthquake or seismic area.

 

(d)   The Mortgaged Property has
adequate rights of access to public streets and roads and to all water,
sanitary sewer and storm drainage facilities necessary for the intended use
thereof. No violation of any Governmental Requirement exists with respect to
the Mortgaged Property, the anticipated use thereof complies with all
Governmental Requirements and all Governmental Requirements as of the date
hereof have been satisfied.

 

5.5.   Litigation Matters.   Except
as previously disclosed to Lender in writing, there are no actions, suits or
proceedings by or before any arbitrator or Governmental Authority (i) pending
against or affecting Borrower, Borrower’s General Partner or the Mortgaged
Property or, to the knowledge of Borrower, threatened against Borrower,
Borrower’s General Partner or the Mortgaged Property, or (ii) to the knowledge
of Borrower, pending or threatened against any Guarantor or any Frisco Square
Affiliate or any of the Frisco Square Property owned by a Frisco Square
Affiliate.

 

5.6.   Compliance With Laws and Agreements.   Each
Obligor is in compliance with all Governmental Requirements applicable to it or
its property and all indentures, agreements and other instruments binding upon
it or its assets, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect. No Obligor is in default in the payment of any Debt or under the terms
or provisions of any agreement or instrument relating to any Debt. No Default
or Event of Default has  occurred
and is continuing.

 

5.7.   Investment and Holding Company Status.   None of the Obligors nor any Constituent Party is (a)
an “investment company” as defined in, or subject to regulation under, the
Investment Company Act of 1940 or (b) a “holding company” as defined in, or
subject to regulation under, the Public Utility Holding Company Act of 1935.

 

5.8.   Taxes.   Each Obligor has
timely filed or caused to be filed all tax returns and reports required to have
been filed by such Person and all taxes, charges and other impositions due and
payable by such Person in accordance with such tax returns have been timely
paid prior to the date on which any fine, penalty, interest, late charge or
loss may be added thereto for nonpayment thereof, except where contested in
good faith by appropriate proceedings and for

 

19

 

which any Obligor, as
applicable, has set aside on its books adequate reserves to cover such items.

 

5.9.   ERISA.   As of the date of
this Agreement, no Obligor maintains any employee benefit plans that require
compliance with ERISA. If at any time any Obligor shall institute any employee
benefits plans, such Obligor shall at all times comply with the requirements of
ERISA.

 

5.10.   Disclosure.   Borrower is
not subject to any agreement, instrument or corporate or other restrictions,
that, individually or in the aggregate, could reasonably be expected to result
in a Material Adverse Effect. Borrower is not aware of any feet could
reasonably be expected to result in a Material Adverse Effect.  None of the reports, financial statements,
certificates or other written information furnished by or on behalf of Borrower
to Lender in connection with the negotiation of this Agreement or delivered
hereunder (as modified or supplemented by other information so furnished)
contains any material misstatement of facts or omits to state any material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading as of the date made or deemed made.

 

5.11.   Margin Regulations.   Borrower
is not engaged principally, or as one of its important activities, directly or indirectly,
in the business of extending credit for the purpose of purchasing or carrying
margin stock, and none of the proceeds of any of the Loans will be used,
directly or indirectly, to purchase or carry any margin stock or made available
by Borrower in any manner to any other Person to enable or assist such Person
in purchasing or carrying margin stock, or otherwise used or made available for
any other purpose which might violate the provisions of Regulations G, T, U, or
X of the Board of Governors of the Federal Reserve System. Terms for which
meanings are provided in Regulation U of said Board of Governors or any
regulations substituted therefor, as are from time to time in effect, are used
in this Section with such meanings, and these representations and warranties
shall be immediately effective.

 

5.12.   Environmental Representations.   Except
as disclosed in writing to Lender before execution and delivery of this
Agreement, (i) each Obligor has obtained and maintained in effect all
Environmental Permits (if any) with respect to the Mortgaged Property, (ii)
each Obligor (and its properties, business and operations) has been and is in
compliance with all applicable Environmental Laws and all Environmental Permits
(if any) with respect to the Mortgaged Property, (in) no Obligor (or any of its
properties, business and operations) is subject to any (A) Environmental Claims
(if any) with respect to the Mortgaged Property or (B) Environmental
Liabilities (if any) with respect to the Mortgaged Property, in either case
direct or contingent, and arising from or based upon any act, omission, event,
condition or circumstance occurring or existing on or prior to the date hereof,
and (iv) no Obligor has received any notice of any violation or alleged
violation of any Environmental Law or Environmental Permit or any Environmental
Claim in connection with the Mortgaged Property. The liability (including any
Environmental Liability and any other damage to persons or property), if any,
of each Obligor with respect to its properties, business and operations which
is reasonably expected to arise in connection with Environmental Laws currently
in effect and other Environmental Matters presently known by such Obligor will
not have a Material Adverse Effect. No Obligor knows of any event or condition
with respect to Environmental Matters with respect to any of its properties
that could reasonably be expected to result in a Material Adverse Effect.

 

20

 

5.13.   Solvency.   Obligors are
now solvent. Each Obligor’s liabilities and obligations under the Loan
Documents to which it is a party do not and will not render such Obligor
insolvent, cause such Obligor’s liabilities to exceed such Obligor’s assets or
leave such Obligor with too little capital to property conduct all of its
business as now conducted or contemplated to be conducted.

 

5.14.   Business Loans.   The Loans
shall be for business, commercial, investment or other similar purpose and not
primarily for personal, family, household or agricultural use, as such terms
are used in the Texas Finance Code.

 

5.15.   No Mechanics’ Lien Inception.   No
land clearing, site preparation or construction has commenced on any of the
Mortgaged Property, nor has any material been delivered to any of the Mortgaged
Property, nor has Borrower made any verbal or written contract or arrangement
of any kind, the occurrence, performance or recordation of which would give
rise to a lien on such Mortgaged
Property having priority equal to or greater than the Liens of the Deed of
Trust

 

5.16.   Disclaimer of Permanent Financing.   Borrower
acknowledges that Lender has not made any commitments, either express or
implied, to extend the term of the Term Loan (except as otherwise expressly set
forth herein) past the Term Loan Maturity Date, or to extend the term of the
Revolving Line of Credit past the RLOC Maturity Date, or to provide Borrower
with any permanent financing or to extend the time for any prepayment
obligation.

 

5.17.   Interstate Land Sales Act.   Borrower’s
development of the Mortgaged Property and the sale or lease of the Mortgaged
Property by Borrower are exempt from the registration and any requirements of
the Interstate Land Sales Full Disclosure Act and the regulations promulgated
thereunder.

 

5.18.   Not
a Broker Or Dealer.   No Obligor is a “broker” or a “dealer”
within the meaning of the Securities Exchange Act of 1934, as amended from time
to time, and any rules or regulations promulgated thereunder.

 

5.19.   Good Title.   Each Obligor
has good title to all property and assets purported to be owned by it,
including those assets identified on the financial statements most recently
delivered by Borrower or such other Obligor to Lender.

 

5.20.   Frisco Square Development Agreement.   To
the best of Borrower’s knowledge, no default by Borrower exists under the
Frisco Square Development Agreement and all necessary approvals and consents by
the City and the MMD have been obtained to the assignment of the rights of “Five
Star” thereunder to Borrower.

 

5.21.   Survival of Representations and Warranties.   All
representations and warranties made herein by or on behalf of Obligors shall
survive the delivery of the Notes, the making of the Loans and any
investigation at any time made by or on behalf of Lender shall not diminish its
rights to rely thereon.

 

21

 

ARTICLE VI.

AFFIRMATIVE COVENANTS OF BORROWER

 

Borrower hereby unconditionally covenants and agrees with Lender, until
the Loans shall have been paid in full and the Lien of the Deed of Trust shall
have been released, as follows:

 

6.1.   Payment of Fees,   Borrower
shall pay to Lender: (i) any Appraisal Fee within five days after demand
therefor by Lender; (ii) the Document Preparation Fee concurrently with the
execution and delivery of this Agreement; (iii) a Term Loan Commitment Fee
annually during the initial 36 month term of the Term Loan on or before the
first and second anniversary of the date of the execution of the Original
Agreement; and (iv) the RLOC Origination Fee concurrently with the execution
and delivery of this Agreement. Borrower and Lender acknowledge that the Term
Loan Origination Fee was paid concurrently with the execution and delivery of
the Original Agreement.

 

6.2.   Notices of Material Events.   Borrower
will, promptly after learning thereof, furnish to Lender prompt written notice
of the following: (i) the occurrence of any Default or Event of Default; (ii)
the filing or commencement of any action, suit or proceeding by or before any
arbitrator or Governmental Authority against or affecting any Obligor thereof
that, if adversely determined, could reasonably be expected to result in a
Material Adverse Effect; (iii) of the filing of any mortgage or Lien or other
security device whatsoever against the Mortgaged Property; or (iv) any other
development that results in, or could reasonably be expected to result in, a
Material Adverse Effect. Borrower shall promptly, and in any event within ten
days after learning thereof, deliver written notice to Lender if any
representation or warranty set forth in Section 5.5 is no longer true or
correct.

 

6.3.   Existence.   Borrower will
(and will cause each Obligor to) preserve and maintain its corporate, limited
liability company or partnership existence, as the case may be.

 

6.4.   Payment of Obligations.   Borrower
will pay its obligations, including liabilities for taxes, before the same
shall become delinquent or in default, except where (a) the validity or amount
thereof is being contested in good faith by appropriate proceedings, or (b)
Borrower has set aside on its books adequate reserves with respect thereto in
accordance with Good Accounting Practice, or (c) the aggregate unpaid amount of
such unpaid obligations is less than or equal to $10,000.00. Upon Lender’s
request, Borrower shall furnish receipts evidencing proof of such payments.

 

6.5.   Books and Records: Inspection Rights.   Borrower
will (and will cause each Obligor to) keep proper books of record and account
in which full, true and correct entries are made of all transactions in
relation to its business, activities and assets as required by Good Accounting
Practice. Borrower will (and will cause each Obligor to) permit any
representatives designated by Lender, upon reasonable prior notice, to visit
and inspect its properties, to examine (on a confidential basis) its books and
records, and to discuss its affairs, finances and condition with its officers,
members, partners or directors and independent accountants, all at such
reasonable times and as often as reasonably requested; provided however,
that with respect to discussions with a Obligor’s independent accountants, such
Obligor shall be given the opportunity to have a representative present during
such discussions, and provided further, that no Obligor shall be
required to disclose to Lender or any agents or representatives thereof any
information which is the subject of attorney-client privilege or attorney’s
work-product privilege

 

22

 

properly asserted by the
applicable Person to prevent the loss of such privilege in connection with such
information.

 

6.6.   Compliance With
Laws.   Borrower
will (and will cause each Obligor to) comply with all Governmental Requirements
applicable to it or its property and all restrictive covenants applicable to
the Mortgaged Property.

 

6.7.   Further Assurances.   At any time upon the
request of Lender, Borrower will, promptly and at its expense, execute,
acknowledge and deliver such further documents and to perform such other acts
and things as Lender may reasonably request to evidence the Loans made
hereunder and interest thereon in accordance with the terms of this Agreement.

 

6.8.   Advances.   Borrower will receive
the Advances and will hold such funds or an equivalent amount of such funds in
trust (but which need not be maintained in a separate account) for the purpose
of paying the items covered by the Application for Advance. Borrower shall
promptly apply any Advances it receives pursuant to this Agreement or any of
the other Loan Documents toward the payment of the items covered by the
Application for Advance pursuant to which such Advance was made, and for no
other purpose without the prior written consent of Lender.

 

6.9.   Reporting
Requirements.   Borrower
agrees to deliver to Lender, during the term of the Loans and until the Loans
have been fully paid and satisfied, the following statements and reports:

 

(a)   As soon as available
and in any event within 90 days after the end of each fiscal year of Borrower,
annual audited financial statements and all notes thereto, including a balance
sheet and statements of income, retained earnings and cash flows for such
fiscal year and the immediately preceding fiscal year in comparative form, all
prepared in conformity with Good Accounting Practice applied on a basis
consistent with that of the preceding fiscal year, and without expressing any
doubt as to such Borrower’s ability to continue as a going concern, and accompanied
by a report and opinion of independent certified public accountants reasonably
satisfactory to Lender stating that such accountants have conducted audits of
such financial statements in accordance with generally accepted auditing
standards and that, in their opinion, such financial statements present fairly,
in all material respects, Borrower’s financial cash flow for the period they
cover in conformity with Good Accounting Practice.

 

(b)   As soon as available
and in any event within 90 days after the end of each calendar year, annual
financial statements for each of the Guarantors, including statements of assets
and liabilities and cash flow.

 

(c)   As soon as available
and in any event within 45 days after the end of each of the first three quarters
of each fiscal year of Borrower, Borrower’s unaudited financial statements,
including Borrower’s balance sheet as at the close of such quarter, Borrower’s
income statement and a statement of Borrower’s cash flow for such quarter and
for the period from the beginning of such fiscal year to the end of such
quarter, each setting forth in comparative form the corresponding figures for
the same quarter of the preceding fiscal year and prepared in accordance with
Good Accounting Practice applied on a basis

 

23

 

consistent with that of
the preceding fiscal year, and certified by an appropriate officer of Borrower.

 

(d)   Promptly upon receipt
thereof, copies of all management letters and other substantive reports
submitted to any Obligor by any independent certified accountant in connection
with any annual audit of such Obligor.

 

(e)   Within ten days of
such returns being filed with the Internal Revenue Service or applicable state
authority, copies of Borrower’s and Guarantor’s state and federal tax returns.

 

(f)   Within ten days of
such documents being filed with the Internal Revenue Service or applicable
state authority, copies of extension requests or similar documents with respect
to Borrower’s or Guarantor’s federal or state income tax filings.

 

(g)   Within 15 days after
the end of each calendar quarter, certificates of compliance executed by an
authorized agent of Borrower and certifying to Lender that each and every
representation and warranty in this Agreement and the other Loan Documents
continues to be accurate in all material respects as of the date of such
certificates and that all covenants contained in this Agreement or in any other
Loan Document have been fully and completely complied with by Borrower to the
date of such monthly certificates.

 

(h)   Within 15 days after
the end of each calendar month marketing reports detailing all marketing
efforts with respect to the Mortgaged Property by and on behalf of Borrower and
Borrower’s Affiliates during the preceding month and the interest level and
activity for potential land sales or tenant leases of any of the Mortgaged
Property.

 

(i)   Within 15 days after
the end of each calendar quarter, (i) sales reports detailing all sales
activities with respect to the Frisco Square Property by and on behalf of
Borrower and Borrower’s Affiliates during such quarter; and (ii) reports
detailing any pending or threatened litigation against Borrower, any other
Obligor or a Frisco Square Affiliate or against the Mortgaged Property or any
of the other Frisco Square Property owned by a Frisco Square Affiliate and any
event of default or event which, with the giving of notice or passage of time,
could become an event of default, by Borrower or any Frisco Square Affiliate under
any Debt of Borrower or such Frisco Square Affiliate.

 

(j)   Prior to or at the
execution of this Agreement and within 15 days after the end of each calendar
quarter, a current Contingent Liability Summary executed and certified to be
true and complete by each Guarantor.

 

(k)   Promptly after
request from Lender, such other information relating to the financial condition
and affairs of Obligors or the Mortgaged Property as Lender may from time to
time reasonably request or as may be required from time to time by any Loan
Document.

 

6.10.   Insurance.   Borrower will
maintain all-risk builder’s risk insurance covering any improvements under
construction on the Mortgaged Property, all-risk insurance covering any such
completed improvements, owner’s and contractor’s liability insurance, workers’

 

24

 

compensation
insurance and such other insurance on such property and against such risks as
Lender may reasonably require, in each case with such insurers and in such
amounts as Lender may reasonably require. Borrower will furnish Lender with
satisfactory evidence thereof promptly upon request. Lender shall be named as
loss payee and a beneficiary of such insurance and shall be provided with
copies of the policies of insurance and a certificate of the insurer that the
insurance required by this Section may not be canceled, reduced or affected in
any manner without 30 days’ prior written notice to Lender. Wherever
applicable, such insurance shall name Lender as loss payee and/or mortgagee
insured. At least 30 days prior to the expiration of any policy of insurance,
Borrower shall furnish Lender with evidence satisfactory to Lender of the
payment of the premium for, and the reissuance of a policy continuing, such
insurance as required by this Section 6.10.

 

6.11.   Liquidity Requirement.   Borrower and Guarantors collectively shall
maintain a minimum liquidity of at least $5,000,000.00 (the “Reserve Requirement”) as hereinafter
provided. Borrower and Guarantors collectively shall be and remain the owner(s)
at all times of Liquid Assets (defined below) having a value (as such value is
determined by Lender) at least equal to the Reserve Requirement, and (b)
Borrower and Guarantors shall not create, place or permit to be created or
placed, or allow to remain, any Lien upon that portion of their Liquid Assets
which equals the Reserve Requirement. For purposes of this provision, (i) the
term “Liquid Assets” shall mean
unrestricted cash, unrestricted marketable securities, non margined publicly
traded securities, FDIC insured certificates of deposit, and United States
government securities; provided, however, for purposes of determining the
Reserve Requirement no more than $2,000,000.00 of securities in Ascendant
Solutions, Inc. in the aggregate may be included in Liquid Assets. Borrower
shall deliver to Lender such schedules, certificates, reports and other
information respecting all or any of Borrower’s Liquid Assets as Lender may
request from time to time. Any such schedule, certificate, report or other
document shall be certified to be true and complete by Borrower and shall be in
such form and detail as Lender may specify and shall be accompanied (if Lender
so requests) by evidence of the ownership of the Liquid Asset, evidence that
the Liquid Asset is unencumbered and evidence of the Liquid Asset’s current
value. Borrower shall permit Lender and its designees from time to time to make
such inspections and audits, and to obtain such confirmations or other
information, with respect to any of the Liquid Assets as Lender deems necessary
or desirable and shall reimburse Lender on demand for all costs and expenses
incurred by Lender in connection with such inspections and audits; provided,
however, that Borrower shall only be obligated to reimburse such costs and
expenses to Lender if (i) Lender had reasonable cause to make such inspection
or audit; or (ii) such inspection or audit follows an Event of Default which
has not been fully cured to Lender’s satisfaction prior to the initiation of
such inspection or audit; or (iii) if such inspection or audit reveals a breach
of the Reserve Requirement.

 

6.12.   Estoppel Certificates.   Borrower will deliver to Lender, promptly
after request therefor, estoppel certificates or written statements, duly
acknowledged, stating the amount that has then been advanced to Borrower under
this Agreement, the amount due on the Notes, and whether any offsets or
defenses exist against the Notes or any of the other Loan Documents.

 

6.13.   Brokers.   BORROWER WILL INDEMNIFY
LENDER FROM CLAIMS OF BROKERS ARISING BY REASON OF THE EXECUTION HEREOF OR THE
CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED HEREBY.

 

25

 

6.14.   Bonding Off Liens.   Borrower shall bond
off under the provisions of all Governmental Requirements any lien or claim of
lien filed for record within ten days of the date of filing of said lien or
claim to the satisfaction of Lender.

 

ARTICLE
VII. 

NEGATIVE COVENANTS

 

Borrower hereby
unconditionally covenants and agrees with Lender, until the Loans shall have
been paid in full and the lien of the Deed of Trust shall have been released,
as follows:

 

7.1.   Fundamental
Changes.

 

(a)   Obligors will not
merge into or consolidate with any other Person, or permit any other Person to
merge into or consolidate with it, or sell, transfer, lease or otherwise
dispose of (in one transaction or in a series of transactions) all or
substantially all of its assets (in each case, whether now owned or hereafter
acquired), or liquidate or dissolve.

 

(b)   Borrower will not,
and will not permit any Obligor to, make any changes in its organizational
structure or status, or amend, alter, modify, rescind, terminate, supplement or
waive any of their respective rights under, or fail to comply with the terms
and provisions of its operating agreement, limited partnership agreement,
articles of incorporation, bylaws or other equivalent documents, as the case
may be, other than for changes or amendments applicable to a Guarantor or a
Constituent Party which could not be reasonably expected to result in a
Material Adverse Effect or to which Lender have consented.

 

7.2.   Investments,
Loans, Advances, Guarantees and Acquisitions.   Borrower will not purchase, hold or acquire
(including pursuant to any merger with any Person) any capital stock, evidences
of indebtedness or other securities (including any option, warrant or other
right to acquire any of the foregoing) of, make or permit to exist any loans or
advances to, guarantee any obligations of, or make or permit to exist any
investment or any other interest in, any other Person, or purchase or otherwise
acquire (in one transaction or a series of transactions) any assets of any
other Person. Notwithstanding the foregoing, Borrower may own limited
partnership or other passive investment interests in Frisco Square Affiliates
and the foregoing shall not restrict such Frisco Square Affiliates from
incurring Debt so long as Borrower has no liability, whether primary or
secondary, absolute or contingent or direct or indirect, with respect to such
Debt.

 

7.3.   Hedging Agreements.   Borrower will not
enter into any hedging agreement, other than hedging agreements entered into in
the ordinary course of business to hedge or mitigate risks to which Borrower is
exposed in the conduct of its business or the management of its liabilities.

 

7.4.   Transaction With
Affiliates.   No
Obligor shall directly or indirectly enter into or permit to exist any
transaction (including, without limitation, the purchase, sale, lease or
exchange of any property or the rendering of any service) with any Affiliate of
Borrower, on terms that are materially less favorable to Borrower or any
Obligor, as applicable, than those that might be obtained in an arm’s length
transaction at the time from Persons who are equally qualified to provide the
same service and are not an Affiliate.

 

26

 

7.5.   ERISA Plan Assets.   Borrower shall not
have any of its assets become subject to Title I of ERISA because they
constitute “plan assets” within the meaning of the DOL Regulation
Section 2510.3-101 and by reason of an investment in Borrower.

 

7.6.   Restricted
Payments.   Borrower
shall not declare or make any dividend payment or other distribution of assets,
properties, cash, rights, obligations or securities (whether as a return of
capital or as a loan repayment) to any partner, member or other equity holder.

 

7.7.   Debt.   (a)   Borrower will not
create, incur, suffer or permit to exist, or assume or guarantee, directly or
indirectly, or become or remain liable with respect to any Debt (other than the
Indebtedness and the MMD Payments), whether direct, indirect, absolute,
contingent or otherwise. The foregoing shall not restrict any Frisco Square
Affiliates from incurring Debt so long as Borrower has no liability, whether
primary or secondary, absolute or contingent or direct or indirect, with
respect to such Debt.

 

(b)   Guarantors will not
create, incur, suffer or permit to exist, or assume or guarantee, directly or
indirectly or become or remain liable with respect to any Debt (other than
under the MMD Guaranty), if such Debt would cause the “Total Net Contingent
Liabilities” of Guarantors, as determined in accordance with the formula set
forth in the Contingent Liability Summary to exceed $25,000,000.00.

 

7.8.   Frisco Square
Development Agreement.   Borrower
will comply with all of the terms and conditions of the Frisco Square
Development Agreement and the MMD Guaranty and fully pay and perform all of
Borrower’s obligations thereunder. Borrower will not amend, alter or terminate
the Frisco Square Development Agreement or MMD Guaranty, or assign any of its
rights or obligations thereunder, unless in each case the same shall have been
approved in advance in writing by Lender.

 

7.9.   Frisco MMD Board.   Borrower shall
exercise reasonable efforts to attempt to maintain at all times two of its
designees as members on the board of the Frisco MMD. Borrower represents that
James C. Leslie and Joseph Cole McDowell Jr. are currently the members
designated by Borrower. Borrower shall give Lender written notice prior to (or
if advance notice is not possible, within two business days after) either of
Borrower’s designated members ceases to be a member of the Frisco MMD governing
board, whether due to an expiration of such member’s term, resignation or
otherwise. Borrower shall obtain Lender’s prior written approval of any Person
Borrower desires to designate to be on the board of the Frisco MMD.

 

7.10.   Application of
Advances.   Borrower
shall not, without the prior written consent of Lender, apply or permit
application of any Advances for any purposes other than those set forth in the
applicable Application for Advance.

 

ARTICLE
VIII.

EVENTS OF DEFAULT

 

8.1.   Events of Default.   Each of the following
shall constitute an “Event of Default”
hereunder:

 

27

 

(a)   Any Obligor shall
fail, refuse, or neglect to pay, in full, any installment or portion of the
Indebtedness within five days after the same shall become due and payable,
whether at the due date thereof stipulated in the Loan Documents, upon
acceleration or otherwise.

 

(b)   Any Obligor or
Constituent Party shall fail, refuse or neglect, or cause others to fail,
refuse or neglect to comply with, perform and discharge any of the its
covenants, conditions or agreements contained in this Agreement or any other
Loan Document other than a failure, breach or default referred to specifically
in this Section 8.1 and the Default caused by such failure, refusal or neglect
to comply is not cured within 30 days after Lender gives written notice thereof
to Borrower; provided, however, if the Default caused by such failure, refusal
or neglect to comply is not reasonably susceptible of cure within such 30 day
period, no Event of Default shall be deemed to have occurred if Borrower
commences such cure within such 30 day period and thereafter diligently and
continuously prosecutes such cure to completion within no later than 60 days
after such notice from Lender.

 

(c)   Any representation,
warranty or statement made by or on behalf of any Obligor or any Constituent
Party in this Agreement or any other Loan Document to which such Person is a
signatory or any amendment or modification hereof or thereof or waiver
hereunder or thereunder, or in any certificate or financial statement required
to be furnished pursuant to this Agreement, is determined by Lender to be false
or misleading in any material respect as of the date hereof or thereof or shall
become so at any time prior to the repayment in full of the Indebtedness.

 

(d)   The occurrence of any
one or more “Guarantor Adverse Acts” as defined in the Limited Guaranty or
other default under the Limited Guaranty after the expiration of any applicable
notice or cure period if such Guarantor Adverse Act(s) or default would have a
Material Adverse Effect on the Mortgaged Property or Borrower’s ability to
repay (or the Lender’s ability to collect) the Indebtedness.

 

(e)   The Deed of Trust or
any of the other Loan Documents shall not, in the reasonable opinion of counsel
for Lender, constitute a perfected first and prior lien on and security
interest in any part of the Mortgaged Property securing payment of the
Indebtedness.

 

(f)   Any Governmental
Authority shall commence proceedings to condemn all or any material part of the
Mortgaged Property and such proceedings shall not be dismissed or terminated
within 30 days.

 

(g)   Any Person shall
commence any action, suit or proceeding against or affecting any of the
Obligors or the Mortgaged Property, or involving the validity or enforceability
of the Loan Documents or the priority of the liens created thereby, at law or
in equity, or before any Governmental Authority, which in the reasonable
judgment of Lender, impairs or would impair its interest in a substantial
portion of the Mortgaged Property, the enforceability of the Loan Documents or
Lender’s ability to collect the Indebtedness when due.

 

28

 

(h)   Any Obligor shall be
prevented or relieved by any Governmental Authority from performing or
observing any material term, covenant or condition of any of the Loan
Documents.

 

(i)   Any Obligor shall:
(i) voluntarily suspend transaction of business, (ii) become insolvent or
unable to pay its or his debts as they mature, (iii) file a voluntary petition
in bankruptcy or a voluntary petition seeking reorganization or to effect a
plan or other arrangement with creditors, (iv) make an assignment for the
benefit of creditors, (v) apply for or consent to the appointment of any
receiver or trustee for any such Person or of all or any substantial portion of
the property of any such Person, or (vi) make an assignment to an agent
authorized to liquidate any substantial part of its or his assets.

 

(j)   In respect of any
Obligor: (i) an involuntary petition shall be filed with any court or other
authority seeking reorganization or a creditors’ arrangement of any such Person
or the adjudication of any such Person as bankrupt or insolvent, (ii) an order
of any court or other authority shall be entered appointing any receiver or
trustee for any such Person or for all or any substantial portion of the
property of any such Person, or (iii) a writ or warrant of attachment or any
similar petition shall be issued by any court or other authority against all or
any substantial portion of the property of any such Person, and such petition
seeking reorganization, a creditors’ arrangement or adjudication or such order appointing
a receiver or trustee is not vacated or stayed, or such writ, warrant of
attachment or similar process is not vacated, released or bonded within 60 days
after its entry or levy.

 

(k)   A Default or Event of
Default shall occur under the terms of the Guaranty or any of the other Loan
Documents which is not cured within any grace, notice or cure period provided
therein or in this Agreement.

 

(l)   Any final judgment
for the payment of money shall be rendered against Borrower or any of the other
Obligors and the same shall remain unstayed or undischarged for a period of 30
days.

 

(m)   Except as
specifically provided for in the Loan Documents, if any Obligor does any of the
following without Lender’s prior written consent: (i) convey, transfer, lease
or encumber any of the Mortgaged Property or the right to receive any rents,
profits, proceeds or any insurance thereof; (ii) liquidate, terminate,
consolidate, merge or dissolve; (iv) convey, transfer, assign or pledge or
permit a conveyance, transfer, assignment or pledge of, an interest in any
Obligor or any Constituent Party of any Obligor in a single transaction or a
series of transactions; (v) allow a Change in Control to occur, (vi) incur any
Debt (excluding the Indebtedness) except as permitted in Section 7.7
hereof, or (vii) create or suffer to be created any Lien, encumbrance,
easement, use or charge affecting any of the Mortgaged Property.

 

(n)   Any Obligor shall
conceal, remove, or permit to be concealed or removed, any part of any Obligor’s
property, with intent to hinder, delay or defraud any of Obligor’s creditors,
or make or suffer a transfer of any of Borrower’s property which may be
fraudulent under any bankruptcy, fraudulent conveyance or similar law; or shall
make any transfer of Obligor’s property to or for the benefit of a creditor at
a time when other creditors similarly situated have not been paid; or shall
suffer or permit, while insolvent,

 

29

 

any creditor to obtain a
lien upon any of Obligor’s property through legal proceedings or distraint
which is not vacated within 30 days from the date thereof.

 

(o)   If any Frisco Square
Affiliate should default on any Debt after giving effect to any required notice
and period of grace with respect thereto that is not cured within six months
after the occurrence of such default; or if Borrower or Borrower’s General
Partner should default on any other Debt (other than the Indebtedness) after
giving effect to any required notice and period of grace with respect thereto.

 

(p)   Lender’s notice to
Borrower that Lender has discovered information that gives Lender, in Lender’s
sole discretion, cause to believe that a Material Adverse Effect has occurred.

 

(q)   Any Obligor fails to
pay when due any amount which he or it is liable to pay to the PBGC or its
successor or to any pension plan (“Plan”),
or notice of intent to terminate any Plan is filed under ERISA, or PBGC
commences proceedings under ERISA to terminate any Plan or to cause a trustee
to be appointed to administer any Plan, or a proceeding is commenced by any
fiduciary of any Plan to enforce Section 515 or Section 4219(c)(5) of ERISA, or
PBGC becomes entitled to obtain a decree adjudicating that any Plan must be
terminated.

 

(r)   Any individual Guarantor
dies and his or her estate or a substantial part of such estate is distributed
by the executor or administrator thereof to his or her heirs or in accordance
with such Guarantor’s will prior to (i) all the distributees of such estate or
part thereof (by an instrument approved in form and substance by Lender) either
(A) jointly and severally assuming all of such deceased Guarantor’s obligations
under the Loan Documents, or (B) effectively pledging, mortgaging or otherwise
creating a first lien (but without any personal liability on such distributees’
part) on a portion of the assets of such estate previously approved by Lender
and valued by a qualified appraiser approved by Lender at not less than the
amount of the Indebtedness then outstanding as additional security for the
Indebtedness or (ii) a substitute Guarantor satisfactory to Lender, in its sole
discretion, executes a Guaranty in form acceptable to Lender within 60 days
after such death, or any individual Obligor becomes legally incompetent, unless
a substitute Guarantor satisfactory to Lender, in its sole discretion, executes
a Guaranty in form acceptable to Lender within 60 days after such death.

 

8.2.   Remedies.   Upon the occurrence
of any Event of Default, and at any time thereafter, Lender shall have the
right, at its option, (1) to cease making Advances, (2) to declare the unpaid
balance of the Indebtedness evidenced by the Notes to be immediately due and
payable without further notice (including notice of intent to accelerate and
notice of acceleration), protest or demand or presentment for payment, all of
which are hereby expressly waived by Borrower, and (3) to enforce or avail
itself of any and all powers, rights and remedies available at law or provided
in this Agreement, the Notes, the other Loan Documents or any other document
executed pursuant hereto or in connection herewith.

 

8.3.   Late Charge.   If any payment
required under the Notes, this Agreement or the other Loan Documents is not
paid within ten days after the date due, Lender may, at its option, assess a
late charge for the purpose of defraying the expense incident to handling such
delinquent payment in an amount equal to the lesser of (i) an amount which,
when added to all other

 

30

 

amounts hereunder which
are interest or are deemed to be interest under applicable state or federal
law, does not exceed the Maximum Lawful Rate or (ii) 5% of the amount of any
such delinquent payment so overdue. Such late charge represents the reasonable
estimate of Lender and Borrower of a fair average compensation for the loss
that may be sustained by Lender due to the failure of Borrower to make timely
payments. Such late charge shall be paid without prejudice to the right of
Lender (i) to collect any other amounts provided to be paid or (ii) to declare
a default hereunder or under the other Loan Documents.

 

ARTICLE IX.

PARTIAL RELEASES

 

9.1.   Conditions of
Partial Releases.   So
long as no Default or Event of Default has occurred and is continuing, Borrower
will have the option from time to time to require Lender to execute a partial
release of the lien of the Deed of Trust as to a Release Parcel designated by
Borrower upon and subject to the terms and conditions hereinafter set forth.
Borrower may exercise such option by delivering to Lender a Partial Release
Notice not less than ten (10) days prior to the date Borrower desires such
Release Parcel to be released. In each case Lender’s obligation to release any
Release Parcel pursuant to this provision will be subject to Borrower’s
satisfaction of each of the following conditions:

 

(a)   If the Release Parcel
is being released for construction, Borrower will provide to Lender such
evidence as Lender shall require that Borrower has obtained construction
financing or other source of funds adequate to pay for the construction
contemplated.

 

(b)   If the Release Parcel
is to be released for a sale, Borrower must be selling the Release Parcel
contemporaneously with the release to a third party purchaser pursuant to an
arms length sale for a cash purchase price and such other consideration as
Borrower shall have disclosed to Lender. Borrower shall deliver a true,
complete and correct copy of the contract for sale and any and all amendments
thereto.

 

(c)   As a condition to the
release of a Release Parcel, Borrower shall pay to Lender the Partial Release
Price for such Release Parcel on or prior to the date such Release Parcel is to
be released from the Deed of Trust.  The
Partial Release Price for each Release Parcel shall be determined by Lender
using the allocations of Initial Appraised Value set forth in Exhibit B
attached hereto. If Borrower designates a Release Parcel to be released from
the lien of the Deed of Trust which does not clearly correspond to one of the
nine parcels of the Mortgaged Property which is separately identified in the
Initial Appraisal and listed in Exhibit B can “Appraisal Parcel”) then Lender will determine the Initial
Appraised Value of such Release Parcel by multiplying the applicable Initial
Appraised Value per square foot times the number of square feet in such Release
Parcel contained within an applicable Appraisal Parcel(s). Any such
determination of the Initial Appraised Value of a particular Release Parcel by
Lender will, absent manifest error, be conclusive and binding upon Borrower for
purposes of these partial release provisions.

 

31

 

(d)   The Partial Release
Price shall be in addition to any other payments against the Loans required or
made prior to the release of a Release Parcel for construction. In addition to
the Partial Release Price, Borrower shall, on or before the effective date of
the partial release, pay all costs and expenses incurred by Lender in
connection with such partial release, including, without limitation, attorneys’
fees, recording fees and any title policy endorsement fees.

 

(e)   The Release Parcel
must be a portion of the Land which can be sold under applicable Governmental
Requirements separate and apart from the remainder of the Mortgaged Property.
Also, Borrower or its predecessors in interest must have executed and recorded
such reciprocal easements and restrictions relating to the Release Parcel and
the remainder of the Mortgaged Property as are necessary or reasonably required
in the judgment of Lender to preserve the utility and value of the remainder of
the Mortgaged Property after the release of the Release Parcel.

 

(f)   If the Release Parcel
does not consist of the entirety of one or more of the Appraised Parcels,
Lender must be satisfied that the value of the remainder of the applicable
Appraised Parcel(s) will not be significantly less than the Initial Appraised
Value of the Appraised Parcels of which the Release Parcel is a part and the remainder
of the Mortgaged Property considered together as a whole, by reason of the
size, location or configuration of such Release Parcel in relation to the
remainder of the applicable Appraisal Parcels and/or the Mortgaged Property.

 

(g)   Borrower shall
deliver to Lender a survey of the Release Parcel and a survey of the remainder
of the Applicable Parcel(s) of which such Release Parcel is a part.

 

(h)   Lender must be
satisfied that the proposed development of the Release Parcel will not
adversely affect future development of the remainder of the Mortgaged Property.

 

(i)   It is also understood
that all of the foregoing conditions are for the benefit of Lender only, and
any delivery by Lender of any partial release will not be construed as
confirmation or an admission by Lender that all such conditions have been
satisfied. Further, Lender may waive any such condition as to any requested
partial release without waiving the same condition as to other requested
partial releases. In no event will Lender be liable for any determination it
may make in good faith as to whether any of the foregoing conditions have been
satisfied, and in connection with any such determination, Borrower must provide
to Lender any reasonably requested information or documentation which may be
relevant.

 

(j)   In any event, all
claims, demands, liabilities, losses, damages, judgments, penalties, costs and
expenses incurred by Lender because of any determination made or action taken
pursuant to these partial release provisions will be covered by the
indemnification set forth in Section 10.3 of this Agreement. Further,
for purposes of such indemnification, any action taken by Lender will be deemed
to have been made at the request of Borrower if made pursuant to any request of
Borrower’s counsel or of any officer of Borrower (or with their knowledge, and
without their objection) in connection

 

32

 

with the execution of any
partial release delivered pursuant to these provisions or any closing of any
applicable sale or construction financing.

 

9.2.   Application of
Partial Release Price.   Lender
shall apply the Partial Release Price first to any amounts owed by Borrower
under Section 9.1(d) above; then Lender shall apply 90% of the balance
of such Partial Release Price to the outstanding principal balance of the Term
Note and the remaining 10% of the balance of the Partial Release Price shall,
at Lender’s sole discretion, either be applied by Lender to the outstanding
principal balance of the Term Note, deposited by Lender into the Borrower’s
Reserve to be utilized for interest on the Term Loan or applied by Lender to
the outstanding principal balance of the Revolver Note or deposited by Lender
into the Borrower’s Reserve to be utilized for interest on the Revolver Note.

 

ARTICLE X. 

MISCELLANEOUS

 

10.1.   No Obligation by
Lender to Construct.   Lender
has no liability or obligation whatsoever or howsoever in connection with the
Mortgaged Property or the development, construction or completion thereof or
work performed thereon, and has no obligation except to disburse the proceeds
of the Loans as herein agreed, Lender is not obligated to inspect the work in
progress nor is Lender liable, and under no circumstances whatsoever shall
Lender be or become liable, for the performance or default of any contractor or
subcontractor, or, for any failure to construct, complete, protect or insure
the Mortgaged Property, or any part thereof, or for the payment of any cost or
expense incurred in connection therewith, or for the performance or
nonperformance of any obligation of any Obligor to Lender nor to any other
Person without limitation. Nothing, including without limitation any
disbursement of the proceeds of the Loans or the Borrower’s Reserve nor
acceptance of any document or instrument, shall be construed as such a
representation or warranty, express or implied, on Lender’s part.

 

10.2.   No Obligation by
Lender to Operate.   Any
term or condition of any of the Loan Documents to the contrary, notwithstanding,
Lender shall not have, and by its execution and acceptance of this Agreement
hereby expressly disclaims, any obligation or responsibility for the
management, conduct or operation of the business and affairs of any Obligor.
Any term or condition of the Loan Documents which permits Lender to disburse
funds, whether from the proceeds of the Loans, the Borrower’s Reserve or
otherwise, or to take or refrain from taking any action with respect to any
Obligor, the Mortgaged Property or any other collateral for repayment of the
Loans, shall be deemed to be solely to permit Lender to audit and review the
management, operation and conduct of the business and affairs of such Obligors,
and to maintain and preserve the security given by Borrower to Lender for the Loans,
and may not be relied upon by any other Person. Further, Lender shall not have,
has not assumed and by its execution and acceptance of this Agreement hereby
expressly disclaims any liability or responsibility for the payment or
performance of any indebtedness or obligation of any Obligor and no term or
condition of the Loan Documents, shall be construed otherwise. Borrower hereby
expressly acknowledges that no term or condition of the Loan Documents shall be
construed so as to deem the relationship between Obligors and Lender to be
other than that of borrower, guarantors and lender, and Borrower shall at all
times represent that the relationship between Obligors and Lender is solely
that of borrower, guarantors and lender.

 

33

 

10.3.   Expenses.

 

(a)   Borrower shall pay
(i) all reasonable out-of-pocket expenses incurred by Lender and its
Affiliates, including the reasonable fees, charges and disbursements of counsel
for Lender, in connection with the preparation and administration of this
Agreement and the other Loan Documents and any amendments, modifications or
waivers of the provisions thereof (whether or not the transactions contemplated
hereby or  thereby shall be
consummated); and (ii) all reasonable out-of-pocket expenses incurred by
Lender, including the fees, charges and disbursements of any counsel for
Lender, in connection with the enforcement or protection of its rights in
connection with this Agreement, including its rights under this Section, or in
connection with the Loans, including all such out-of-pocket expenses incurred
during any workout, restructuring or negotiations in respect of the Loans.

 

(b)   Borrower shall
indemnify each Indemnified Party against, and hold each Indemnified Party harmless
from, any and all Environmental Claims and any and all losses, claims, damages,
liabilities and related expenses, including the fees, charges and disbursements
of any counsel for any Indemnified Party, incurred by or asserted against any
Indemnified Party arising out of, in connection with, or as a result of (i) the
matters referenced in subsection (a) of this Section or the performance by the
parties hereto of their respective obligations hereunder; (ii) the Loan
Documents, the Loans or the use of the proceeds of the Loans; or (iii) any
actual or prospective claim, litigation, investigation or proceeding relating
to any of the foregoing, whether based on contract, tort or any other theory
and regardless of whether any Indemnified Party is a party thereto; provided
that such indemnity shall not, as to any Indemnified Party, be available to the
extent that such losses, claims, damages, liabilities or related expenses
resulted from the gross negligence or willful misconduct of, or violation of
applicable law by, such Indemnified Party. THE
FOREGOING INDEMNITY INDEMNIFIES EACH INDEMNIFIED PARTY FROM ITS OWN NEGLIGENCE.

 

(c)   To the extent
permitted by applicable law, Borrower shall not assert, and hereby waives, any
claim against any Indemnified Party, on any theory of liability, for special,
indirect, consequential or punitive damages (as opposed to direct or actual
damages) arising out of, in connection with, or as a result of, this Agreement
or any agreement or instrument contemplated hereby, the Transactions, either
Loan or the use of the proceeds of the Loans.

 

(d)   All amounts due under
this Section shall be payable not later than ten Business Days after written
demand therefor.

 

10.4.   Waivers;
Amendments.   No failure or delay by Lender in exercising
any right or power hereunder or under any other Loan Document shall operate as
a waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any
other right or power. The rights and remedies of Lender hereunder and under any
other Loan Document are cumulative and are not exclusive of any rights or
remedies that they would otherwise have at law or in equity. No waiver of any
provision of this Agreement or consent to any departure by Borrower therefrom
shall in any event be effective unless the same

 

34

 

shall be in a writing
executed by Lender, and then such waiver or consent shall be effective only in
the specific instance and for the purpose for which given. Neither this
Agreement nor any provision hereof may be waived, amended or modified except
pursuant to an agreement or agreements in writing entered into by Borrower and
Lender.

 

10.5.   Counterparts;
Effectiveness; Joint and Several.   This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. This Agreement
shall become effective when it shall have been executed by Lender and when
Lender shall have received counterparts hereof which, when taken together, bear
the signatures of each of the other parties hereto, and thereafter shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns. Each Person constituting Borrower shall be
bound jointly and severally with one another to make, keep, observe and perform
the representations, warranties, covenants, agreements, obligations and
liabilities imposed by this Agreement upon the “Borrower.”

 

10.6.   Severability.   Any provision of this
Agreement held to be invalid, illegal or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such
invalidity, illegality or unenforceability without affecting the validity,
legality and enforceability of the remaining provisions hereof; and the
invalidity of a particular provision in a particular jurisdiction shall not
invalidate such provision in any other jurisdiction.

 

10.7.   Right of Setoff.   If an Event of
Default shall have occurred and be continuing, Lender is hereby authorized at
any time and from time to time, to the fullest extent permitted by law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other obligations at any time owing
by Lender or for the credit or the account of Borrower against any of and all
the obligations of Borrower now or hereafter existing under this Agreement held
by Lender and then due and payable. The rights of Lender under this Section are
in addition to other rights and remedies (including other rights of setoff)
that Lender may have.

 

10.8.   No Agency.   Nothing herein shall
be construed as making or constituting Lender as the agent of Borrower in
making any payments to third parties pursuant to this Agreement or any other
Loan Documents.

 

10.9.   Successors and
Assigns.   This
Agreement shall be binding upon, and shall inure to the benefit of, Borrower
and Lender, and their respective heirs, legal representatives, successors and
assigns; provided, however, that Borrower may not assign any rights or
obligations under this Agreement without the prior written consent of Lender.

 

10.10. Survival.   The provisions hereof
shall survive the execution of all instruments herein mentioned, shall continue
in full force and effect until the Loans have been paid in full and shall not
be affected by any investigation made by any party.

 

10.11. Governing Law; Jurisdiction;
Consent to Service of Process.

 

(a)   THIS
AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE
STATE OF TEXAS.

 

35

 

(b)   Borrower
hereby irrevocably and unconditionally submits, for itself and its property, to
the nonexclusive jurisdiction of the district courts of Dallas County, Texas,
and of the United States District Court of the Northern District of Texas
(Dallas Division), and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Agreement, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such State, or to the extent
permitted by law in such Federal, court. Each of the parties hereto agrees that
a final judgment in any such action or proceeding shall be conclusive and may
be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. Nothing in this Agreement shall affect any right that
Lender may otherwise have to bring any action or proceeding relating to this
Agreement against Borrower or its properties in the courts of any jurisdiction.

 

(c)   Borrower
hereby irrevocably and unconditionally waives, to the fullest extent it may
legally and effectively do so, any objection which it may now or hereafter have
to the laying of venue of any suit, action or proceeding arising out of or
relating to this Agreement in any court referred to in subsection (b) of this
Section. Each of the parties hereto hereby irrevocably waives, to the fullest
extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.

 

(d)   Each
party to this Agreement irrevocably consents to service of process in the
manner provided for notices in Section 10.12. Nothing in this Agreement
will affect the right of any party to this Agreement to serve process in any
other manner permitted by law.

 

10.12.   Notices.   All notices or other communications required
or permitted to be given pursuant to this Agreement shall be in writing and
shall be considered as properly given if (i) mailed by first class United
States mail, postage prepaid, registered or certified with return receipt
requested; (ii) by delivering same in person to the intended addressee; or
(iii) by delivery to an independent third party commercial delivery service for
same day or next day delivery and providing for evidence of receipt at the
office of the intended addressee. Notice so mailed shall be effective upon its
deposit with the United States Postage Service or any successor thereto; notice
sent by a commercial delivery service shall be effective upon delivery to such
commercial delivery service; notice given by personal delivery shall be
effective only if and when received by the addressee; and notice given by other
means shall be effective only if and when received at the designated address of
the intended addressee. For purposes of notice, the addresses of the parties
shall be as set forth on page 1 of this Agreement; provided, however, that
either party shall have the right to change its address for notice hereunder to
any other location within the continental United States by the giving of 30
days notice to the other party in the manner set forth herein.

 

10.13.   Reliance by Lender.   Lender is relying and is entitled to rely upon
each and all of the provisions of this Agreement; and accordingly, if any
provision or provisions of this Agreement should be held to be invalid or
ineffective, then all other provisions hereof shall continue in full force and
effect notwithstanding.

 

36

 

10.14. Participations.   Lender
shall have the right at any time and from time to time to grant participations
in the Loans and Loan Documents. Each participant shall be entitled to receive
all information received by Lender regarding the creditworthiness of any
Obligor and any Constituent Party, including (without limitation) information
required to be disclosed to a participant pursuant to Banking Circular 181
(Rev., August 2, 1984), issued by the Comptroller of the Currency (whether the
participant is subject to the circular or not). Lender agrees to notify
Borrower of any such participation interests sold by Lender and the name and
address of such participant.

 

10.15. Usury
Savings Clause.   Notwithstanding any provision to the
contrary contained in this Agreement or in any of the other Loan Documents, it
is expressly provided that in no case or event shall the aggregate of (a) all
interest on the unpaid balance of the Notes, accrued or paid from the date
hereof and (b) the aggregate of any other amounts accrued or paid pursuant to
the Notes, the Deed of Trust or any of the other Loan Documents, which under
applicable laws are or may be deemed to constitute interest upon the
Indebtedness from the date hereof, ever exceed the maximum rate of interest which
could lawfully be contracted for, charged or received on the unpaid principal
balance of the Indebtedness. In this connection, it is expressly stipulated and
agreed that it is the intent of Borrower and Lender to contract in strict
compliance with the applicable usury laws of the State of Texas and of the 

United States (whichever permit the higher rate of interest) from time to time
in effect. In furtherance thereof, none of the terms of this Agreement, the
Notes, the Deed of Trust or any of the other Loan Documents shall ever be
construed to create a contract to pay, as consideration for the use,
forbearance or detention of money, interest at a rate in excess of the Highest
Lawful Rate. Obligors or other Persons now or hereafter becoming liable for
payment of the Indebtedness shall never be liable for interest in excess of the
Highest Lawful Rate. If under any circumstances the aggregate amounts paid on
the Indebtedness include amounts which by law are deemed interest which would
exceed the Highest Lawful Rate, Borrower stipulates that such amounts will be
deemed to have been paid as a result of an error on the part of both Borrower
and Lender, and the Person receiving such excess payment shall promptly, upon
discovery of such error or upon notice thereof from the Person making such
payment, refund the amount of such excess or, at Lender’s option, credit such
excess against the unpaid principal balance of the Indebtedness. In addition,
all sums paid or agreed to be paid to the holder or holders of the Indebtedness
for the use, forbearance, or detention of money shall, to the extent required
to avoid or minimize usury and to the extent permitted by applicable law, be
amortized, prorated, allocated and spread throughout the full term of the
Indebtedness so that the interest rate does not exceed the Highest Lawful Rate.
The provisions of this Section shall control all agreements, whether now or
hereafter existing and whether written or oral, between Borrower and Lender.

 

10.16. Controlling
Document.   In the event of a conflict between the terms and
conditions of this Agreement and the terms and conditions of any other Loan
Document, the terms and conditions of this Agreement shall control.

 

10.17. Waiver
Of Right To Trial By Jury.   BORROWER HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ALL RIGHT TO TRIAL
BY JURY IN ANY ACTION, SUIT, PROCEEDING, OR COUNTERCLAIM THAT RELATES TO OR
ARISES OUT OF ANY OF THE LOAN DOCUMENTS OR THE ACTS OR FAILURE TO ACT OF OR BY
LENDER IN THE ENFORCEMENT OF ANY OF THE TERMS OR PROVISIONS OF THIS AGREEMENT
OR THE OTHER LOAN DOCUMENTS.

 

37

 

10.18. Entire
Agreement.   THIS
AGREEMENT AND THE OTHER 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. THIS INSTRUMENT MAY BE AMENDED ONLY BY AN
INSTRUMENT IN WRITING EXECUTED BY THE PARTIES HERETO.

 

10.19. Restatement.   This
Agreement is intended to and does completely amend and restate, without
novation, the Original Agreement in its entirety. All Liens and security
interests existing by virtue of the Original Agreement are hereby confirmed and
ratified and shall continue to secure all obligations under this Agreement, but
the terms and provisions of such Liens and security interests shall hereafter
be governed in all respects by this Agreement.

 

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

 

	
   

  	
   

  	
  LENDER:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  COMERICA
  BANK

  
	
   

  	
   

  	
  By:

  	
  

  /s/ Dan P. Fryman

  	
   

  
	
   

  	
   

  	
   

  	
  Dan P. Fryman 

  Senior Vice President

  

 

	
   

  	
   

  	
  BORROWER:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  FRISCO
  SQUARE LAND, LTD., 

  a Texas limited partnership

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Fairways
  FS Land, LLC 

  a Texas limited liability company, 

  Its General Partner

  
	
   

  	
   

  	
   

  	
  By:

  	
  

  /s/ James C. Leslie

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  James C. Leslie, 

  Manager

  

 

List of Exhibits:

 

Exhibit A -    Approved
Budget

Exhibit B -    List of Appraised Values 

Exhibit C -    Contingent Liability Summary Form

 

38

 

ACKNOWLEDGEMENT, CONSENT AND RATIFICATION OF GUARANTY

 

The undersigned
Guarantors hereby execute below to evidence their acknowledgement and consent
to the Amended and Restated Loan Agreement (this “Agreement”) to which this Acknowledgement, Consent and
Ratification of Guaranty is attached (all terms used herein having the meaning
ascribed thereto above in this Agreement unless otherwise defined herein) and
the transactions contemplated by this Agreement, including without limitation
the modifications of the existing Loan Documents contemplated by this
Agreement. In addition, each of the undersigned Guarantors has determined that
such Guarantor will benefit from this Agreement and the transactions and modifications
contemplated by this Agreement and are willing to acknowledge that the Borrower’s
obligations to Lender set forth in this Agreement and the Loan Documents (as
modified as contemplated by this Agreement) are guaranteed obligations of
Guarantors pursuant to that certain Guaranty dated April 15, 2005 executed by
Guarantor in favor of Lender (the “Guaranty”).  In consideration of the benefits afforded
by this Agreement, each of the undersigned Guarantors hereby, jointly and
severally, ratifies and confirms the Guaranty and agrees that all of its
respective obligations and covenants under the Guaranty shall remain unimpaired
by the execution and delivery of this Agreement and the other documents and
instruments executed in connection therewith and that the Guaranty shall remain
in full force and effect. Furthermore, each of the undersigned Guarantors
jointly and severally acknowledge and agree that:

 

(a)   the
Guaranty shall remain in full force and effect and shall continue to be the
legal, valid and binding joint and several obligation of the undersigned
Guarantors in their individual capacities enforceable against them in their
individual capacities in accordance with its terms;

 

(b)   the
indebtedness evidenced by the Term Note and the Revolver Note and the
obligations, indebtedness and liabilities arising in connection with this
Agreement are included in the “Indebtedness” as such term is used in the
Guaranty;

 

(c)   the
Guaranty is not subject to any claims, defenses or offsets;

 

(d)   nothing
contained in this Agreement or any other Loan Document shall adversely affect
any right or remedy of Lender under the Guaranty;

 

(e)   the
execution and delivery of this Agreement or any of the Loan Documents
contemplated by this Agreement shall in no way reduce, impair or discharge any
obligations of the undersigned Guarantors pursuant to the Guaranty and shall
not constitute a waiver by Lender of any of Lender’s rights against any of the
undersigned Guarantors; and

 

(f)   the
undersigned’s consent is not required for the effectiveness of this Agreement
or any of the transactions or modifications contemplated by this Agreement and
the fact that this consent has been obtained in connection with this Agreement
shall not in any way be deemed a waiver of any of the provisions of the
Guaranty; and the undersigned acknowledges and agrees that, as provided in
paragraph 8 of the Guaranty, Bank may, once or any number of times, modify the
terms of the Indebtedness, compromise, extend, increase, accelerate, renew or
forbear to enforce payment of any or all of the Indebtedness, or permit
Borrower to incur additional

 

39

 

Indebtedness, all without
notice to the undersigned and without affecting in any manner the unconditional
obligation of the undersigned under the Guaranty.

 

THIS
ACKNOWLEDGEMENT, CONSENT AND RATIFICATION OF GUARANTY AND THIS AGREEMENT AND
THE OTHER LOAN DOCUMENTS, AS MODIFIED BY THIS AGREEMENT, 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 OF THE PARTIES.

 

	
  /s/ Cathy R. Sweeney

  	
   

  	
   

  	
   

  	
  /s/ James C. Leslie

  	
   

  
	
  CATHY R. SWEENEY

   

  16250 Dallas Parkway,
  Suite 102

  Dallas, Texas 75248

  	
   

  	
   

  	
  JAMES C. LESLIE

   

  16250 Dallas Parkway,
  Suite 102

  Dallas, Texas 75248

  
	
  

  /s/ David F. Stringfield

  	
   

  	
   

  	
   

  	
  

  /s/ A. Brant Bryan

  	
   

  
	
  DAVID F. STRINGFIELD

   

  16250 Dallas Parkway,
  Suite 102

  Dallas, Texas 75248

  	
   

  	
   

  	
  A. BRANT BRYAN

   

  16250 Dallas Parkway,
  Suite 102

  Dallas, Texas 75248

  
							

 

40

 

EXHIBIT A

 

APPROVED
BUDGET

 

	
  ALLOCATIONS

  	
   

  	
  AMOUNT

  	
   

  	
  ADVANCED

  UNDER

  ORIGINAL

  AGREEMENT

  	
   

  	
  AVAILABLE

  AS OF THE

  DATE OF

  THIS

  AGREEMENT

  	
   

  
	
  Refinance Advance

  	
   

  	
  $

  	
  19,500,000.00

  	
   

  	
  $

  	
  19,500,000.00

  	
   

  	
  $

  	
  0

  	
   

  
	
  Interest Reserve Advances

  	
   

  	
  $

  	
  4,313,000.00

  	
   

  	
  $

  	
  1,173,000.00

  	
   

  	
  $

  	
  3,140,000.00

  	
   

  
	
  Tax Advances

  	
   

  	
  $

  	
  150,000.00

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  150,000.00

  	
   

  
	
  MMD Advances

  	
   

  	
  $

  	
  1,472,000.00

  	
   

  	
  $

  	
  492,000.00

  	
   

  	
  $

  	
  980,000.00

  	
   

  
	
  Working Capital Advances

  	
   

  	
  $

  	
  1,229,000.00

  	
   

  	
  $

  	
  1,229,000.00

  	
  *

  	
  $

  	
  0

  	
   

  
	
  Maximum Term Loan Commitment

  	
   

  	
  $

  	
  26,664,000.00

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

* The Working Capital
Advances Allocation under the Original Loan Agreement was $2,229,000.00;
Working Capital Advances previously made that exceed the Working Capital
Advances Allocation herein contained are being repaid contemporaneous with the
execution of this Agreement by the Term Loan Repayment.

 

 

EXHIBIT
B

 

LIST  OF  APPRAISED
VALUES

 

	
  PARCEL

  	
   

  	
  VALUE PER SQUARE

  FOOT

  	
   

  	
  AGGREGATE VALUE

  	
   

  
	
  (Parcels as described in Initial Appraisal)

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Parcel 1 (10.3824 acres)

  	
   

  	
  $

  	
  20.00

  	
   

  	
  $

  	
  9,045,000.00

  	
   

  
	
  Parcel 2 (4.1247) acres

  	
   

  	
  $

  	
  30.00

  	
   

  	
  $

  	
  5,390,000.00

  	
   

  
	
  Parcel 3 (4.7622) acres)

  	
   

  	
  $

  	
  30.00

  	
   

  	
  $

  	
  6,225,000.00

  	
   

  
	
  Parcel 4 (6.1977 acres)

  	
   

  	
  $

  	
  20.00

  	
   

  	
  $

  	
  5,400,000.00

  	
   

  
	
  Parcel 5 (4.216 acres)

  	
   

  	
  $

  	
  20.00

  	
   

  	
  $

  	
  3,675,000.00

  	
   

  
	
  Parcel 6 (8.3436 acres)

  	
   

  	
  $

  	
  15.00

  	
   

  	
  $

  	
  5,450,000.00

  	
   

  
	
  Parcel 7 (6.0377 acres)

  	
   

  	
  $

  	
  25.00

  	
   

  	
  $

  	
  6,575,000.00

  	
   

  
	
  Parcel 8 (2.5088 acres)

  	
   

  	
  $

  	
  30.00

  	
   

  	
  $

  	
  3,280,000.00

  	
   

  
	
  Parcel 9 (2.1177 acres)

  	
   

  	
  $

  	
  30.00

  	
   

  	
  $

  	
  2,770,000.00

  	
   

  
	
  Total Initial Appraised Value

  	
   

  	
   

  	
   

  	
  $

  	
  47,810,000.00

  	
   

  

 

 

EXHIBIT “C”

 

Contingent Liability Summary

 

	
  Contingencies by Borrower Name

  	
   

  	
  Property Description

  	
   

  	
  % Guaranteed

  	
   

  	
  (Use initials)

  Guaranteed by Who?

  	
   

  	
  Budgeted

  Cost

  	
   

  	
  Actual

  Cost

  	
   

  	
  Loan

  Liability

  	
   

  	
  75% of

  Project Cost

  (Actual)

  	
   

  	
  60% of

  Pad Cost

  (Actual)

  	
   

  	
  50% of

  Land Cost

  (Actual)

  	
   

  	
  Total Net

  Contingent

  Liabilities

  	
   

  
	
  Acquired/Completed/Under
  Construction

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  XYZ Site

  	
   

  	
  XYZ location

  	
   

  	
  100

  	
  %

  	
  CS, BB, JL, DS

  	
   

  	
  $

  	
  3,600,000

  	
   

  	
  $

  	
  3,600,000

  	
   

  	
  $

  	
  3,240,000

  	
   

  	
  $

  	
  2,700,000

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  540,000

  	
   

  
	
  Pad
  Sites

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ABC Pad

  	
   

  	
  ABC location

  	
   

  	
  100

  	
  %

  	
  CS, BB, JL, DS

  	
   

  	
  $

  	
  800,000

  	
   

  	
  $

  	
  750,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
   

  	
   

  	
  $

  	
  450,000

  	
   

  	
   

  	
   

  	
  $

  	
  150,000

  	
   

  
	
  Unimproved
  Land

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EFG property

  	
   

  	
  EFG property

  	
   

  	
  100

  	
  %

  	
  CS, BB, JL, DS

  	
   

  	
  $

  	
  1,000,000

  	
   

  	
  $

  	
  1,000,000

  	
   

  	
  $

  	
  500,000

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  500,000

  	
   

  	
  $

  	
   

  	
   

  
	
  Total
  Contingenotes

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  690,000

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00131-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00131-of-00352.parquet"}]]