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Home My WebLink AboutContract 34106�w6 b a P�'E �F��II 1 �� ~� � ., . � � �� _ `�� CONSENT TO DEED OF TRUST LIEN UPON LEASEHOLD FORT WORTH SPIlVK.S AIRPORT UNIlVIPROVED GROUND LEASE AGREEMENT WITH MANDATORY IlVIPROVEMENTS (CITY SECRETARY CONTRACT NO. 33940) This CONSENT TO DEED OF TRUST LIEN UPON LEASEHOLD ("Agreement") is made and entered into by and between the CITY OF FORT WORTH ("Lessor"), a home rule municipal corporation organized under the laws of the State of Texas; CLIFF MILLICAN ("Lessee"), an individual, and Southwest Bank ("Bank"), a Texas ba�lking association. A. On or about August 30, 2006, Lessor and Lessee entered into City Secretary Contract ("CSC") No. 33940, an wiimproved ground lease agreement with mandatory improvements for approximately s�teen thousand eight hundred square feet of unimproved ground, more specifically identified as Lease Site E-12 (the "Leased Premises"), at Fort Worth Spinks Airport ("Airport"). CSC No. 33940 shall hereinafter be referred to as the "Lease." B. In order for Lessee to obtain certain financing related to Lessee's construction of the mandatory improvements on the Leased Premises, Lessee and Bank desire Lessor to consent to the execution by Lessee of a Leasehold Deed of Trust lien on the Leased Premises (the "Deed of Trust") in favor of the Bank. NOW, THEREFORE, Lessor, Lessee and the Bank hereby agree as follows: 1. The statements set forth in the recitals above are true and correct and form the basis upon which Lessor, Lessee and the Bank have entered into this Agreement. The Lease is a public document on file in Lessor's City Secretary's Office and is incorporated herein by reference for all purposes. 2. Lessor hereby consents to the execution and delivery by Lessee to the Bank of the Deed of Trust, which is attached hereto as Exhibit "A." Lessor does not adopt, ratify or approve of any of the particular provisions of the Deed of Trust and does not grant any right, privilege or use to Lessee, Bank, or any successor in interest pursuant to the Deed of Trust that is different from or more extensive than any right, privilege or use granted to Lessee under the Lease. Notwithstanding anything contrary in the Deed of Trust, Lessee and the Bank acknowledge, understand and agree Cliff Millican Consent to Deed of Trust in Favor of Southwest Bank CSC No. 33940 Page 1 of 7 �� t�lPe��t /��QY �, LyyV P��, ��Y➢. that Lessee and the Bank do not have any right to convey any interests in the Leased Premises greater than those granted specifically by the Lease. In the event of any conflict between the Deed of Trust and the Lease, the Lease shall control in all respects as to Lessor and as to Lessee's and the Bank's obligations to Lessor established by the Lease and/or this Agreement. In the event of any conflict between the Deed of Trust and this Agreement, this Agreement shall control. In the event of any conflict between this Agreement and the Lease, the Lease sha11 control. 3. In the event that Lessor is required by the Lease to provide any kind of written notice to Lessee with regard to the Leased Premises, including notice of breach or default by Lessee, Lessor shall also provide a copy of such written notice to the Bank. Lessor agrees that (i) the Bank may perform any of the obligations or requirements imposed on Lessee by the Lease in order to avoid a breach or default under the Lease by Lessee and (ii) Lessor will accept the Bank's performance the same as if Lessee had performed such obligations or requirements. 4. Lessor agrees and covenants that it will not exercise any rights it may have under the Lease to cancel or ternvnate the Lease or to force surrender of all or part of the Leased Premises unless it first has provided the Bank with written notice of its intent to exercise such any such right. The Bank shall have ten (10) calendar days from the date it receives such notice to cure any monetary default under the Lease and thii-ty (30) calendar days from the date it receives such notice to cure any other default under the Lease to Lessor's reasonable satisfaction in order to avoid such cancellation, termination or surrender; provided, however, that if the Bank, in good faith and after diligent and continuous efforts to remedy any non-monetary default under the Lease, cannot cure such default within thirty (30) calendar days, it shall notify Lessor in writing and Lessor and the Bank shall negotiate in good faith a reasonable amount of additional time to cure such default. 5. Lessee agrees that it will not request to or consent to any future modifications, amendments or assignments of the Lease without first receiving the Bank's written consent thereto and providing a copy of such written consent to Lessor. Lessee understands and agrees that any such consent granted by Lessor without Bank's advance written consent shall be void and specifically releases, holds harmless and agrees to indemnify Lessor for any damages that may arise as a result of any such consent. 6. As long as such does not conflict with Lessor's rights under the Lease, Lessor consents to the exercise by the Bank of any and all rights and remedies permitted under the Deed of trust (including judicial and/or non judicial foreclosure on the Leased Premises), and to the exercise of such additional legal and equitable rights and remedies as may be available to Bank, if an Event of Default occurs under the Deed of Trust. In the event that Bank undertakes to enforce its rights to any collateral granted by the Deed of Trust on account default by Lessee under the Deed of Trust, Lessor will cooperate with the Bank in its efforts to assemble and/or remove any personal properly of Lessee on the Premises. The Bank hereby agrees to repair any damages at or to the Airport, Cliff Millican Consent to Deed of Trust in Favor of Southwest Bank CSC No. 33940 Page 2 of 7 �� t�l� ��1�� U�tlD�� CISG�l� including the Leased Premises, caused by or incident to such removal. 7. As a condition precedent to the effectiveness of this Agreement, Lessee agrees and covenants that it will endorse all insurance policies required by the Lease to name both Lessor and the Bank as additional insureds and to cover a11 public risks related to the leasing, use, occupancy, maintenance, existence or location of the Leased Premises. Notwithstanding anythuig to the contrary in the Deed of Trust, the Bank hereby agrees and covenants that any and a11 proceeds payable under the terms of such insurance policies shall first be applied to cover the replacement of a11 facilities and improvements on the Leased Premises and to satisfy fully the terms and conditions of the Lease. Payment of such proceeds sha11 apply secondarily to secure any of Lessee's indebtedness to the Bank. 8. Subject to Sections 4 and 6 of this Agreement, Lessor may take all action available to it under the Lease, at law or in equity in order to protect its interests, including, but not limited to, cancellation of Lessee's interest as provided by the Lease and in accordance with this Agreement. 9. The Bank agrees that it promptly will notify Lessor in writing when the Bank has released its rights under the Deed of Trust. This Agreement will automatically terminate on the earlier of (i) the date as of which the Bank releases such rights or (ii) the date upon which the Lease expires or is teniiinated. 10. If the Bank forecloses on the Leased Premises as a result of exercising its right sunder the Deed of Trust, the Bank may become the owner of all of Lessee's rights under the Lease, without Lessor's further action or consent. However, if the Bank desires to sell or otherwise transfer its leasehold interest in the Leased Premises to a third party (either at or after foreclosure), the Bank must obtain the Lessor's written consent to and approval of the purchaser. Such consent and approval will not be unreasonably withheld, conditioned or delayed. Nothing in this Agreement is intended to prohibit the Bank from assigning the liens and security interests created by the Deed of Trust to another financial institution with Lessor's priar written consent, which such consent will not be unreasonably withheld, conditioned, or delayed. 11. Notices to the Bank required pursuant to the provisions of this Agreement shall be conclusively determined to have been delivered when (i) hand-delivered to the Bank, its agents, employees, servants or representatives, or (ii) deposited in the United States Mail, certified, return receipt requested, addressed as follows: Southwest Bank 3737 S.W. Loop 820 Fort Worth, Texas 76133 Attn: Kathy Dagnell Cliff Millican Consent to Deed of Trust in Favor of Southwest Bank CSC No. 33940 Page 3 of 7 `;��d;!� ��J�r� �li� �� . ��uG��, ��. 12. The parties hereto understand and agree that upon expiration or ternunation of the Lease, all structures, improvements and fixtures on the Leased Premises, and any items permanently attached to any such structure, f�ture or improvement, will become the sole property of Lessor, free and clear of a11 liens, including the Deed of Trust, except for improvements of a non-permanent nature, all trade fixtures, machinery, furnishings and other items may specifically be removed from the Leased Premises in accordance with the Lease. In the event that the Lease expires or is terminated, Lessee and the Bank covenant and agree that nothing herein shall obligate Lessor to assume in any way Lessee's indebtedness to the Bank. 13. This Agreement may not be withdrawn, amended or modified except by a written agreement executed by the parties hereto and approved by Lessor's City CounciL Lessee and Bank covenant and agree that they will not amend the Deed of Trust, or assign any rights and/or obligations thereunder, without the prior written consent of Lessor. 14. This Agreement shall be construed in accordance with the laws of the State of Texas. Venue for any action arising under the provisions of this Agreement sha11 lie in state courts located in Tarrant County, Texas or in the United States District Court for the Northern District of Texas, Fort Worth Division. 15. This written instrurnent, including any documents attached hereto and/or incorporated herein by reference, contains the entire understanding and agreement between Lessor, Lessee and Bank as to the matters contained herein. Any prior or contemporaneous oral or written agreement concerning such matters is hereby declared null and void to the extent in conflict with this Agreement. [Signature Pages Immediately Follow] Cliff Millican Consent to Deed of Trust in Favor of Southwest Bank CSC No. 33940 Page 4 of 7 ��9�"1�� 'i�`' �� , �';i �p�, ��, IN WITNESS F, the parties hereto ha�e executed this Agreement in multiples on this the � day of , 200 (�, . CITY OF FORT WORTH: By: . �,. M�� oi� � Assistant City Manager Date: STATE OF TEXAS COUNTY OF TARRANT BEFORE ME, the undersigned authority, a Notary Public in and for the State of Texas, on this day personally appeared Marc Ott, known to me to be the person whose name is subscribed to the foregoing instruinent, and acknowledged to me that the same was the act of the City of Fort Worth and that he executed the same as the act of the City of Fort Worth for the purposes and consideration therein expressed and in the capacity therein stated. ,.� GNEN UNDER MY I IAND AND SEAL OF OFFICE this ,Q�, , Zoo 6 . A�,�.� a�.� �,�,�.� � �` ef�,,� i��S� �..l�a�� y � � & fut � �GPv;'�ISSff3"a �XPfRE� c,� �y`' July 2�, 2t)07 �,;; . C<'S � tl .:�, '. �,,�r,.� �a,�,�"$'��--�:° APPROVED AS TO FORM AND LEGALIT : � � ti n �.� ; . � '� _ ,� p �� ` � r,�L%�y,✓�`'"\.� �� IVlaleshia B.�Fanner Assistant City Attorney M&C: C-21750; Approved 10/3/06 C1iffMillican Consent to Deed of Trust in Favor of South�vest Bank CSC No. 33940 Pase � of 7 day %� > � — � �� Notary ublic in and for the State of Texas ATTEST: � BY�� Marly He ix City Secretary ��9�;)�;'�� r�' �!�' ��P� �Y, �`v��, ��, CLIFF MILLICAN: ATTEST: By: r' ,�..�,�� . °��..�� By: Name. �C � r' l= ��tZ� �j .,,�> t t it'��'�'V Title: f ;��sit��a'�,�"'�"� Date: i � - / � - �2 /�/� �� STATE OF TEXAS COUNTY OF r�raa / BEFORE ME, the undersigned authority, a Notary Public in and for the State of Texas, on this day personally appeared Cliff Millican, known to me to be the person whose name is subscribed to the foregoing instniment, and acknowledged to me that the same was the act of Cliff Millican and that s/he executed the same for the purposes and consideration therein expressed and in the capacity therein stated. GNEN IJNDER MY HAND AND SEAL OF OFFICE this �D � day , , 200 6 • � -�-�.�,,��.. -.�.��3� �� .. �,�,�srs�� `—�� ^� ��i� ��b� {� �!�` rQ��d�RlS�fO�fV EY9�dFdE� � 'rg�-:;;�'`'� J�ly 26, 2�07 � � '�� Cliff Millican Consent to Deed of Trust in Favor of Southwest Bank CSC No. 33940 Page 6 of 7 Notary Public in and or the State of Texas ��i�� i �I�r ��.�� .,.;,, ��,.,f 4p� � ¢.'�d��U1�Ytl� U�GY� SOUTHWEST BANK: a Texas banking association: �� • '°, �: _, `�, . ��;I By: r Name: _ �` � ; r� , � �� , � `�-.-� � o..,i�, '�: Title: � c� �� «► ��"�._ f �, , -r�- Date: � ;_%� � � .� C.� (J� � STATE OF TEXAS COUNTY OF ��;.. � , � , ' ATTEST: ; -, � - R, � / / , B _ ��- ��-�- � y� � �: _ � BEFORE ME, the undersigned authority, a, Notary Public in and for the State of Texas, on this day personally appeared ;; .; :� C� ', , known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that the same was the act of Southwest Bank, and that s/he executed the same as the act of Southwest Bank, for the purposes and consideration therein expressed and in the capacity therein sta.ted. GIVEN LJNDER MY HAND AND SEAL OF OFFICE this day ' r y-; t-„, ,,'" , 200? , o,PP� P�e�, KATFiY DAGNELL ¢ �� NOTARY PUBLIC STATE OF TEXAS �j,TE OF t�+P My Comm. Exp. 05-04-2010 Cliff Miliican Consent to Deed of Trust in Favor of Southwest Bank CSC No. 33940 Page 7 of 7 � < i�, �� , ,:;1�-�� `<�� Notary Publio i and for t�i� State of Texas �� N�� V�� I� ��r; �� . �v �Y�, ��, EXHIBIT "A" NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKEANYOF THE FOLLOWING INFORMATION FROM THIS INSTRUMENT BEFORE IT {S FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER. After Recording Retum To: SOUTHWEST BANK 3737 S.W. Loop 820 Fort Worth, Texas 76133 Attn: Kathy Dagnell Loan No. SOUTHWEST BANK LEASEHOLD DEED OFTRUST THE STATE OF TEXAS COUNTY OF TARRANT Leasehold THIS LEASEHQLD DEED OF TRUST is made by CLIFFORD A. MILLICAN and MAX HELEN MILLICAN (collectively "Granto�' whether one or more), to Larry L. Kilgore of Tarrant County, Texas, as Trustee ("Trustee"), for the benefit of SOUTHWEST BANK ("Bank"). For $10 and other consideration, Grantor grants to Trustee the Mortgaged Property (defined below) in trust, to secure the full and timely payment and performance of the Indebtedness (defined below) and Obligations (defined 6elow), and grants to Bank a security interest in the Personalty (defined below), to secure the full and timely payment and performance of the Indebtedness and Obligations. As additional consideration, Grantor presently and absolutely assigns to Bank the Rents (defined below), subject to a license back to Grantor, as described in Article Four. The conveyance of the Mortgaged Property is subject to the Permitted En�umbrances (defined below). Grantor agrees as follows: ARTICLE ONE DEFINITIONS 1.1 Definitions. As used herein, the following tertns shall have the following meanings: "Application forAdvance" means the documentwhich is in a form acceptable to Bank by which Borrower requests Bank to make a Construction Advance. "Approved BudgeY' means a budget showing the amounts then known or estimated which have been paid, are payable, or are to be incurred by Borrower, in the development and construction of the Project, and all other amounts which are directly or indirectly related to the Project and which are, or will be paid, payable or incurred by Borrower prior to the completion of the Project. "Architectural BarrierLaws" means anyand all architectural barrierlaws including, without limitation, the Americans with Disabilities Act of 1990, P.L. 101-336, and the Architectural Barrier Act, 23 Tex. Rev. Civ. Stat. art. 9102, as amended, or any successorthereto. "Bank" means Southwest Bank and its successors and assigns whether or not such successor and/or assign is a financial institution. "BorroweP means, collectively, Clifford A. Millican, Max Helen Millican and CAM Certified Aircraft Maintenance, I nc. "Construction Advance" means each advance by Bank, under the Note, to or for the benefit of Borrower for construction of the Project. "Construction Committed Sum" means the maximum amount of Construction Advances, in the aggregate, which Bank will advance to, or for the benefit of, Borrower which shall be $ "Contracts" means all of the right, title, and interest of Grantor, including equitable rights, in, to, and under any and all (a) contracts forthe purchase of all or any portion of the Mortgaged Property, whether such contracts are now or at any time hereafter existi�g, including, but without limitation, any and all earnest money or other deposits escrowed or to be escrowed or letters of credit - 1 - sssiei.z (aio�ioe) provided or to be provided by the purchasers under the contracts, inciuding all amendments and supplements to and renewals and extensions of the contracts at any time made, and together with all payments, eamings, income, and profits arising from the sale of all or any portion of the Mortgaged Property or from the contracts and all other sums due or to become due under and pursuant thereto and together with any and all earnest money, security, letters of credit or other deposits under any of the contracts; (b) contracts, ficenses, orpermits, which are directly or indirectly related to, or connected with, the development, ownership, maintenance or operation of the Mortgaged Property, whether such contracts, licenses, and permits are now or at any time thereafter existing, and all improvements constructed or to be constructed on the Mortgaged Property with all Legal Requirements appficabie to the Mortgaged Property; (c) any and all right, title, and interest Grantor may have in any financing arrangements relating to the financing of or the purchase of all or any portion of the Mortgaged Property by future purchasers; and (d) all other contracts which in any way relate to the use, enjoyment, occupancy, operation, maintenance, repair, management orownership ofthe Mortgaged Property (save and except any and all Leases), including but not limited to maintenance and service contracts and management agreements. "Debtor Relief Laws" means the Bankruptcy Code of the United States and all other applicable liquidation, conservatorship, bankruptcy, moratorium, rearrangement, insolvency, reorganization, or similar debtor relief laws affecting the rights of creditors generally from time to time in effect. "Deed of Trust" means this Leasehold Deed of Trust and all amendments, renewals, extensions and replacements to such. "Disposition" means any sale, lease (except as permitted under this Deed of Trust or in some other written agreement executed by Bank), exchange, assignment, conveyance, transfer, trade, or other disposition of all or any portion of the Mortgaged Property (or any interest therein). "Environmental Laws" means any federal, state, or lo�al law, statute, ordinance, or regulation, whether now or hereafter in effect, pertaining to health, industrial hygiene, or the environmental conditions on, under, or about the Mortgaged Property, including, without limitation, the following, as now or hereafter amended: Comprehensive Environmental Response, Compensation, and LiabilityAct of 1980 ("CERCLA"), 42 U.S.C. § 9601 et seq.; Resource, Conservation and RecoveryAct ("RCRA"), 42 U.S.C. § 6901 et se . as amended by the 5uperfund Amendments and Reauthorization Act of 1986 ("SARA"), Pub. L. 99-499, 100 5tat. 1613; the Toxic Substances Control Act ("TSCA"), 15 U.S.C. § 2601 et seq.; Emergency Planning and Community Right to Know Act of 1986 ("EPCRA"), 42 U.S.C. § 11001 et seq.; Clean AirAct ("CAA"), 42 U.S.C. § 7401 et se .; Federal Water Poliution Control Act ("FW PCA"), 33 U.S.C. § 1251 et se .; and any corresponding state laws or ordinances including but not limited to the Texas Water Code ("TWC") § 26.001 et seq; Texas Health 8� 5afety Code ("THS�") § 361.001 et seq.; and regulations, rules, guidelines, or standards promulgated pursuant to su�h laws, statutes and regulations, as such statutes, regulations, rules, guidelines, and standards are amended from time to iirne. "Environmental Report" means a detailed review ofthe environmental condition ofthe Mortgaged Property in scope satisfactory to Bank by an environmental consulting firm approved in advance by Bank; "Expiration Date" means the last day that Bank will make a Construction Advance which shall be "Fixtures" means any and all materials, supplies, equipment, systems, apparatus, and other items now owned or hereafter acquired by Grantor and now or hereafter attached to, installed fn, or used in connection with (temporarily or permanently) any of the Improvements or the Land, which are now owned or hereafter acquired by Grantor and are now or hereafter attached to the Land or the Improvements, together with ail accessions, appurtenances, replacements, betterments, and substitutions for any of the foregoing and the proceeds thereof. "Governmental Authority" means any and all applicable couRs, boards, agencies, commissions, offices, or authorities of any nature whatsoever for any governmental unit (federal, state, county, district, municipal, city or otherwise), whether now or hereafter in existence. "Grantor" means each Person designated in the first sentence of this Deed of Trust as Grantor and that Person's heirs, personal representatives, successors and assigns, and all subsequentowners ofthe Mortgaged Property (without implying Bank's consent to any Disposition of all or any portion of the Mortgaged Property). "Ground Lease" means that certain Lease Agreement (including any and all extensions, renewals, amendments or modifications thereo� dated , 2006, by and between City of Fort Worth as Lessor and Grantor, as Lessee, which Ground Lease establishes and evidences the leasehold interest and estate of Grantor in the Land and in the Improvements and rights, titles and interests appurtenant thereto. "Guarantor" means each Person which guarantees, in whole, or in part, the repayment of the Note. "Hazardous Su6stances" means 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: (a) any substance included within the definition of "hazardous waste" pursuant to Section 7004 of RCRA; (b) any substance inciuded within the definition of "hazardous substance" pursuant to Section 101 vf CERCLA; (c) any substance included within (i) the definition of "regulated substance" pursuant to 5ection 26.342(11) of TWC; or (ii) the definition of "hazardous substance" pursuant to Section 361.003(11) of THSC; (d) asbestos; (e) polychlorinated biphenyls; (fl petroleum products; (g) underground storage tanks, whether empty, filled or partially filled with any substance; (h) any radioactive materials, urea formaldehyde foam insulation or radon; (i) any substance included within the definition of "waste" pursuant to Section 30.003(b) of TWC or "pollutanY' pursuant to Section 26.001(13) of TWC; and (j) any other chemical, material or substance, the exposure to which is prohibited, limited or regulated - 2 - 559'1612 (8l07I06) by any Govemmental Authority on the basis that such chemical, material or substance is toxic, hazardous or harmful to human health or the environment. The term "Hazardous Substances" shall not include those chemicals at the Mortgaged Property which are kept in de minimis quaniities (5 gallons or less), proper{y containerized and labeled for retail use, and utilized according to label instructions for general maintenance purposes. "Hazardous Substances Contaminafion" means the contamination (whether presently exisiing or hereafter occurring) of the Improvements, facilities, soil, groundwater, surface water, air or other elements on or of the Mortgaged Property by Hazardous 5ubstances, or the contamination of the buildings, facilities, soil, groundwater, surface water, air or other elements on or of any other property as a resuit of Hazardous 5ubstances at any time (whether before or after the date of the Deed of Trust) emanating from the Mortgaged Property. "Impositions" means: (a) all real estate and personal propertytaxes, charges, assessments, standbyfees, excises, and levies and any interest, costs, or penaliies with respect thereto, general and special, ordinary and extraordinary, foreseen and unforeseen, of any kind and nature whatsoever which at any time prior to or after the execution hereof may be assessed, levied, or imposed upon the Mortgaged Property orthe ownership, use, occupan�y, or enjoyment thereof, or any portion thereof, or the sidewalks, streets, or alleyways adjacent thereto; (b) any charges, fees, license payments, or other sums payable for or under any easement, license, or agreement maintained for the benefit of the Mortgaged Property; (c) water, gas, sewer, electricity, and other utility charges and fees relating to the Mortgaged Property; and (d) assessments and charges arising under any subdivision, condominium, planned unit development, or other declarations, restrictions, regimes, or agreements affeating the Mortgaged Property. "Improvements" means any and all of Grantor's right, title, and/or interest in and to all buildings, open parking areas, structures and other improvements of any kind or nature, and any and ail additions, alterations, betterments or appurtenances thereto, now or at any fime hereafter situated, placed, or constructed upon the Land or any part thereof. "Indebtedness" means all present and future indebtedness, obligations, and liabilities, arising under the Note and the other Loan Documents, and ail renewals, extensions, and modifications thereof, or any part thereof, now or hereafter owed to Bank by Borrower under the Loan Documents or by Grantor under this Deed of Trust, and all interest accruing thereon and costs, expenses, and reasonable attomeys' fees incurred in the enforcement or coilection thereof, regardless of whether such indebtedness, obligations, and liabilities are direct, indirect, fixed, contingent, liquidated, unliquidated, joint, several, or joint and several, and all renewals and extensions thereof, or any part thereof, and all present and future amendments thereto. "Indebtedness," however, does not include any debt which is covered by the federal Truth-in-Lending Act. "Land" means all of Grantors right, title, and interest in and to that certain real property, more particulariy described in Exhibit "A" attached hereto and incorporated herein by this reference, togetherwith all right, title, interest, and privileges of Grantor in and to (a) all streets, ways, roads, alleys, easements, rights-of-way, licenses, rights of ingress and egress, vehicle parking rights and public places, existing or proposed, abutting, adjacent, used in connection with or pertaining to such real property or the improvements thereon; (b) any strips or gores of real property behveen such real property and abutting or adjacent properties; (c) all water and water rights, timber and crops pertaining to such real estate; and (d) all appurtenances and a�l reversions and remainders in or to such real property. "Lease Guaranties" means all claims and rights under any and ali lease guaranties, letters of credit and any other credit support (individually, a"Lease Guaranty", and collectively, the "Lease Guaranties") given to Grantor by any guarentor in connection with any of the Leases (individually, a"Lease Guarantor", and collectively, the "Lease Guarantors"). "Leases" means any and all leases, licenses, or other agreements (whether written or oral; or now or hereafter in effect), other than the Ground Lease, which grant to third parties a possessory interest in and to, or the right to use or occupy, all or any part of the Mortgaged Property, together with all security and other deposits or payments made in connection therewith. "Leqal Requirements" means: (a) any and all present and future judicial decisions, statutes, rulings, rules, regulations, permits, certificates, or ordinances of any Govemmental Authority in any way applicabie to Grantor, Borrower or the Mortgaged Property, including, without limiting, the generalityof tfie foregoing, the ownership, use, occupancy, possession, construction, operation, mainte�ance, alteration, repair, or reconstruction thereof; (b) any and all covenants, conditions, and restrictions contained in any deeds, other forms of conveyance, or in any other instruments of any nature that relate in any way or are applicable to the Mortgaged Property or the ownership, use, or occupancy thereof; {c) Grantor's or Borrower's presently or subsequently effective bylaws and articles of incorporation, operating agreement and articles of organization or paRnership, limited partnership, joint venture, trust, or other form of business association agreement; and (d) any and all Leases and other contracts (written or oral), of any nature that relate in any way to the Mortgaged Property and to which Grantor or Borrower may be bound. "Loan Documents" means this Deed ofTrust, the Note, and all otherdocuments which evidence, secure, guarantee or relate to the indebtedness evidenced by the Note, as such may be renewed, extended, modified, and replaced. "Maximum Rate" means the ma�mum non-usurious rate of interest (or, if the conYext so requires, an amount calculated at such rate) which Bank is allowed to contract for, charge, take, reserve, or receive under the Loan Documents pursuant to applicable federal or state (whichever is higher) law frvm time to time in effiect after taking into account, to the extent required, by applicable federal or state (whichever is higher) lawfrom time to time in effect, any and all relevant payments or charges underthe Loan Documents. "Minerals" means all substances in, on, under or above the Land which are now, or may become in the future, intrinsically valuable (that is, valuabie in themselves) and which now or may be in the future enjoyed through extraction or removal from - 3 - sse�stz (eia��ae� the property, including without limitation, oil, gas, and all other hydrocarbons, coal, lignite, carbon dioxide and all other nonhydrocarbon gases, uranium and all other radioactive substances, and gold, silver, copper, iron and all other metallic substances or ores. "Mortgaged Property" means all of Grantor's leasehold estate and interest, now owned or hereafter acquired, in and to the Land, Minerals, Fixtures, Improvements, Personalty, Contracts and Leases, together with any and all other security and coilateral of any nature whatsoever, now or hereafter given for the repayment of the Indebtedness or the perFortnance and discharge of the Obligations. As used in this Deed of Trust, the term "Mortgaaed Property" shall be e�ressly defined as meaning all or, where the context pertnits or requires, any portion of the above and ail or, where the context permits or requires, any interest therein. "Note" means the Promissory Note dated August_, 2006 in the original principal amount of $425,ODO.DO executed by Borrower and payable to the order of Bank and all amendments, restatements, increases, renewals, and extensions of such Promissory Note. THE NOTE DOES NOT CONTAIN A REVOLVING CREDIT FEATURE. "Obligations" means any and all of the covenants, condiiions, warranfies, representations and other obfigations (other than to repay the Indebtedness) made or undertaken by Grantor, Borrower, or Guarantor to Bank as set forth in the Loan Documents. "Permitted Encumbrances" means (a) the lien and security interest created by this Deed of Trust and any other lien against the Mortgaged Property in favor of Bank, and all liens and security interests expressly permitted by Bank, (b) the liens and/or encumbrances set forth in Exhibit "B" attached hereto and made a part hereof, if any, or (c) the matters, if any, set forth as exceptions on Schedule B of the Title Policy, if any, or (d) if no Exhibit "B" is attached hereto and no Title Policy is issued, then any liens and/or encumbrances affecting the Mortgaged Property appearing (as of the date of this Deed of Trust) in the Real Property Records of the county(ies) in which the Land is situated, but only to the extent the same are valid and subsisting plus all renewals and exiensions of the foregoing (hereinafter called the "Permitted Encumbrances"). "Person" means any natural person, firtn, corporaiion, association, partnerships, joint venture, trust, or other entity, as applicable. "Personal " means all of the right, iitle, and interest of Grantor in and to (a) all equipment and all materials of every nature now or later situated upon the Land and (i) intended to be incorporated into the Improvements, or (ii) that are or become Fixtures, (b) ail equipment, now owned or later acquired by Grantor and now or later situated on the Land or in the Improvements and that are necessary to the use or occupancy of the Improvements, but excluding (for purposes of this Deed of Trust) equiprnent used principally in Grantor's 6usiness operations; (c) all cash funds, fees (whether refundable, retumable or reimbursable), deposit accounts or other funds or evidences of cash, credit or indebtedness deposited by or on behalf of Grantor with any governmental agencies, boards, corporations, providers ofutilityservices, public or private, any awards, reimbursements, settlements, orcompensation heretofore made or hereafter to be made by any Govemmental Authority pertaining to the Land, Improvements, Fixtures, Contracts, or Personalty, plus trademarks, trade names, and symbols used in connection with the Land and Improvements; any and all of which are now owned or hereafter acquired by Grantor, and which are now or hereafter situated in, on, or about the Land or the Improvements, or used in or necessary to the complete and proper development, constru�tion, use, occupancy, or operation thereof, together with all accessions, replacements, and substitutions thereto or therefor and the proceeds thereof. "Pro'ect" means the construction, on the Land, of a hangar and maintenance facilities, and offices at the Fort WoRh, Texas Spinks Airport. "Rents" means all rent and other income from the Mortgaged Property, including ail rent and other income under all existing or future Leases. "Title Policy" means a(Leasehold) Mortgagee Policy of Title Insurance issued by a Title Company for the benefit of Bank and relating to the Land and the lien created by this Deed of Trust. "Trustee" means the individual described as Trustee in the initial paragraph to this Deed of Trust. 12 Additional Definitions. (a) All pronouns, whether in masculine, feminine or neuter form, shall be deemed to refer to the object of such pronoun whether same is masculine, feminine or neuter in gender, as the context may suggest or require. (b) "Includin " means including, without limitation. (c) All terms used herein, whetheror notdefined in 5ection 1.1 hereof, and whether used in singular or plural form, shall be deemed to refer to the object of such term whether such is singular or plural in nature, as the context may suggest or require. ARTICLE TWO SECUREDINDEBTEDNESS 2.1 5ecured Indebtedness. This Deed of Trust is made to secure and enforce the timely payment of the Indebtedness, and the full and timely performance of the Obligations. _ Q _ 559'161.2 (8l07/D6) ARTICLE THREE REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS OF GRANTOR 3.1 Representations and Warranties. Grantor does hereby represent and warrant to Bank as follows: (a) Financial Matters. Grantor is solvent, is not bankrupt and has no outstanding liens, suits, gamishments, bankruptcies or court aotions which could render Grantor insolvent or banlwpt. There has not been filed by or (to Grantors knowledge) against Grantor a petifion in bankruptcy or a petifion or answer seeking an assignment for fhe benefit of creditors, the appointment of a receiver, trustee, custodian or liquidator with respect to Grantor or any porEion of Grantor's property, reorganization, arrangement, rearrangement, composition, extension, liquidation or dissolution or similar relief under the United States Bankruptcy Code or any state law. All reports, statements, contracts of saie, and other data fumished by Grantor to Bank in connection with the loan evidenced by the Note are true and correot in all material respects and do not omit to state any fact or circumstance necessary to make the statements contained therein not misleading. No material adverse change has occurred since the dates of such reports, statements and other data in the financial condition of Grantor or of any tenant under leases described in such reports, statements and other data. For the purposes of this Seciion, Grentor shall also include any joint venturer or general partner of Grantor. (b) Title and Authority. Grantor (ij is the lawiul owner of all of lessee's right, iitle, and interest in, to and under the Ground Lease, and such right, titie and interest is valid and subsisting, and is a first and prior leasehold estate, and (ii) has good and marketable title to the Improvements, Fixtures and Personalty, and has good right and authoriiy to grant, encumber, sell, transfer, assign and mortgage all of Grantor's interest in the Master Lease, Land, and Improvements and to grant a security interest in the Personalty. (c) Permitted Encumbrances. The Mortgaged Property is free and clear from all liens, security interests and encumbrances except the Permitted Encumbrances. There are no me�hanic's or materialmen's liens or other claims constituting or that may constitute a lien on the Mortgaged Property, or any part thereof. (d) No Homestead. If Grantor is a natural person, no portion of the Mortgaged Property is being used as Grantor's business or residential homestead. (e) Compliance with Covenants and Laws. The Mortgaged Property and the intended use thereof by Grantor do not violate any Legal Requirements, without reliance upon grandfather provisions or adjacent or other properties. Grantor has obtained all requisite zoning, utiliiy, building, health and operating permits from each Governmental Authority having jurisdiction over the Mortgaged Property. All engineering specifications with respect to the Mortgaged Property are within applicable environmental standards. (� Environmenfal. Except as disclosed in the Environmental Report, if any, obtained for or relied upon by Bank in connection with the loan evidenced by the Note, and the Ground Lease, the Mortgaged Property does not contain any Hazardous Substances, and the Mortgaged Property is not affected by any Hazardous Substances Contamination. The Mortgaged Property and the operations conducted thereon do not violate any Legal Requirement or Environmental Laws. Grantor has not obtained and is not required to obtain any permits, licenses or similar authorizations to construct, occupy, operate or use any Improvements and equipment forming a part of the Mortgaged Property by reason of any Environmental Laws. Grantor undertook, at the time of acquisition of the Mortgaged Property, all appropriate inquiry into the previous ownership and uses of the Mortgaged Property consistent with good commercial or customary practice to determine that the Mortgaged Property and the uses therefor are in compliance with all Environmental Laws. The use which Grantor makes and intends to make of the Mortgaged Property will not result in the disposal or other release of any Hazardous 5ubstances on the Mortgaged Property, in violation of any Environmental Laws. (g) Condition of Property. The Mortgaged Property is in good condition and repair with no deferred maintenance and is free from damage caused by fire or other casualty. (h) Encroachments. None of the improvements on the Mortgaged Property create an encroachment over, across or upon any of the Mortgaged Property boundary lines, rights of way or easements and no buildings or other improvements on adjoining land create such an encroachment, except as may be expressly recognized and permitted by Bank. (i) Organization. Grantor has all requisite power and all governmental certificates of authority, licenses, permits, qualifications and other documentation to own, lease and operate its properties and to carry on its business as now conducted and as contemplated to be conducted. The foregoing representation in this Subsection shall also apply to any corporation, partnership, joint venture or limited paRnership which is a general partner orjoint venturer of Grantor. (j) Enforceability. The Note, this Deed of Trust and all other Loan Documents constitute the legai, valid and binding obligations of Grantor enforceable in accordance with their respective terms. (k) Taxes. Grantor has filed all federal, state, county, municipal, and city income and other tax returns required to have been filed by it, and has paid all taxes and related liabilities which have become due (except those being - 5 - sssisi.z (aio�ios) contested in good faith by Grantor) pursuant to such retums or pursuant to any assessments received by it. Grantor does not know of any basis for any additional assessment in respect of any such taxes and re{ated liabilities, except as otherwise disclosed in wrifing to Bank. (I) Relationship of Grentor and Bank. Notwithstanding any prior business or personal retationship between Grantor and Bank, or any officer, director or employee of Bank, the relationship between Grantor and Bank is solely that of debtor and creditor, Bank has no fiduciary or other special retationship with Grantor, Grantor and Bank are not partners or joint venturers, and no term or condition of any of the Loan Documents shall be cbnstrued so as to deem the relationship between Grantor and Bank to be other than that of debtor and creditor. 3.2 AfFrmative and Negative Covenants and Agreements. 50 long as the Indebtedness or any part thereof remains unpaid, Grantor covenants and agrees with Bank as follows: (a) Payment and Performance. Grantor will make prompt payment, as the same becomes due, of the Indebtedness and shall punctually and properly perform all of Grantors Obligations under the Loan Documents. (b) Operation of Mortgaged Property. Grantor will operate the Mortgaged Property in accordance with all Legal Requirements and will pay all fees or charges of any kind in connection therewith. Grantor will not use, or allow the use of, the Mortgaged Property in any manner which violates any Legal Requirement or which constitutes a public or private nuisance or which makes void, voidable or cancelable, any insurance then in force with respect thereto. Grantor will not initiate or pertnit any zoning reclassification of the Mortgaged Property which is unacceptable to Bank or seek any variance under existing zoning ordinances applicable to the Mortgaged Property which is unacceptabie to Bank or use or permit the use of the Mortgaged Property in such a manner which would resuit in such use becoming a nonconforming use under applicable zoning ordinances or other Applicable Laws. Grantor will not impose any restrictive covenants or encumbrances upon the Mortgaged Property, execute or file any subdiv�sion plat affecting the Mortgaged Property or consent to the annexation of the Mortgaged Property to any municipality, without the prior written consent of Bank. Grantor wiil not agree or consent to any drilling or exploration for, or extraction, removal or production of Minerals from the surtace or subsurface of the Mortgaged Property regardless of the depth thereof or the method of mining or extraction thereof. Grantor will not do or suffer to be done any act whereby the value of any part of the Mortgaged Property may be materially lessened. Grantor will allow Bank or its authorized representative to enter the Mortgaged Property at any reasonable time to inspect the MoRgaged Property and Grantor will assist Bank or said representative in whatever way necessary to make such inspection. If Grantor received a notice or claim from any federal, state orother govemmental entity pertaining to the Mortgaged Property, including, without limitation, a nofice that the Mortgaged Property is not in compliance wifh any Legal Requirement, Grantor will promptly fumish a copy of such notice or claim to Bank. (c) DebtsforConstruction;Paymentoflmpositions.5ubjecttoSection8.11,Grantorwillcausealldebts and liabilities of any character, including without limitation, all debts and liabilities for labor, material and equipment and all de6ts and charges for utilities servicing the Mortgaged Property, incurred in the constru�tion, maintenance, operation and development of the Mortgaged Property, to be promptly paid. Grantor will duly pay and discharge, or cause to be paid and discharged, the Impositions not later than the earlierto occur of (i) the due date thereof, (ii) the date any fine, penalty, interest, or cost may be added thereto or imposed, or (iii) the date prior to any date any lien may be filed for the nonpayment thereof (if such date is used to determine the due date of the respective item), and Grantor shall deliver to Bank a written receipt evidencing the payment of the respective Imposition. (d) Repair and Maintenance. Except as may be prohibited by the Ground Lease, Grantor will keep the Mortgaged Property in good order, repair, operating condition and appearance, causing all necessary repairs, renewals, replacements, additions and improvements to be promptly made, and will not allow any of the Mortgaged Property to be misused, abused or wasted or to deteriorate. Grantor will not, without the priorwritten consent of Bank, (i) remove from the Mortgaged Property any Fixtures or personal property covered by this Deed of Trust except those replaced by Grantor by an article of equal suitability and value, owned by Grantor, free and clear of any lien or security interest (except that created by this Deed of Trust); (ii) make any sEructural alteration to the Mortgaged Property or any other alterations thereto which impair the value thereof; or (iii) make any alteration to the Mortgaged Property involving an estimated expenditure exceeding $50,000 except pursuant to plans and specifications approved in writing by Bank. (e) Insurance and Casualty. Grantor will keep the Mortgaged Property insured against loss or damage by fire, explosion, windstorm, hai�, flood (if the Mortgaged Property shall at any time be located in an identified "flood prone area" in which flood insurance has been made available pursuant to the Flood Disaster Protection Act of 1973), tornado and such other hazards as may be required by Bank by policies of fire, extended coverage and other insurance (including builder's risk, if appiicable) in such company or companies, in such amounts, upon such terms and provisions, and with such endorsements, all as may be acceptabie to Bank. Grantor will also provide such other insurance as Bank may from time to time require (including Commercial General Liability), in such companies, upon such terms and provisions, in such amounts, and with such endorsements, all as are approved by Bank. Grantor further agrees that Grantor will deliver to Bank copies of the original policies evidencing such insurance and any additional insurance which shall be taken out upon any part of the Mortgaged Property and receipts evidencing the payment of all premiums, and will deliver certificates evidencing renewals of all such policies of insurance to Bank at least fifteen (15) days before any such insurance shall expire. Without limiting the discretion of Bank with respect to required endorsements to insurance policies, Grantor further agrees that all such policies shall provide that proceeds thereunder will be payable to Bank as its interest may appear pursuant and subject to a mortgage clause (without contribution) of standard form attached to or otherwise made a part of the applicable policy. In the event any of the Mortgaged Property covered by such insurance is destroyed or damaged by fire, explosion, windstorm, _ 6 - 5591612 (8107I06) haii or by any other casualty against which insurance shall have been required hereunder, (i) Bank may, but shall not be obfigated to, make proof of loss if not made promptly by Grantor, (ii) each insurance company concemed is hereby authorized and directed to make payment for such loss directly to Bank instead of to Grantor, and (iii) Bank shall have the right to apply the insurance proceeds first, to reimburse Bank orTrustee for all costs and expenses, including, without limitation, reasonable attorneys' fees, incurred in connection with the collection of such proceeds and, second, the remainder of said proceeds shall be applied, at the sole discretion of Bank, in payment (without premium or penalty) of the Indebtedness, either in whole or in part, in the order detertnined by Bank in its sole discretion, or to the repair, restoraiion or replacement, either partiy or enfirely, of the Mortgaged Property so destroyed or damaged, provided that, any insurance proceeds held by Bank to be appfied to the repair, restoraiion or repla�ement of the Mortgaged Property shall be so held without payment or allowance of interest thereon and shall be paid out from time to time upon compliance by Grantor with such tertns, condifions and requirements as may be reasonably imposed by Bank. In any event the unpaid portion of the Indebtedness shall remain in full force and effect and Grantor shall not be excused in the payment thereof. If any act or occurrence of any kind or nature (including any casualty on which insurance was not obtained or obtainable) shail result in damage to or loss or destrucfion of the Mortgaged Property, Grantor shall give immediate written notice thereof to Bank and, unless otherwise so instructed by Bank, shall promptly, at Grantor's sole cost and expense and regardless of whether the insuran�e proceeds, if any, shall be sufficient for the purpose, restore, repair, rep►ace and rebuild the Mortgaged Property as neariy as possible to its value, condition and character immediately prior to such damage, loss or destruction in accordance with plans and specifications submitted to and approved by Bank. Notwithstanding the preceding and any corrtrery provision in the Loan Documents, if an Event of Default does not then exist, Bank agrees to use such irtsurence proceeds to restore or rebuild the Improvements to a condition satisfactory to Bank provided that all of the following conditions are satisfied: (i) Bank determines, in its sole and unreviewable discretion, that it is economically, financiaily and practically feasible to repair and restore the Improvements to their previous condition prior to the Note's maturity date; (ii) the total cost of repairing and restoring fhe Improvements to their previous condition, as estimated by an architect or engineer approved by Bank, shall not be greater than the amount of such insurence proceeds together with any sums that Grentor deposits with Bank in advance forthe purpose of paying forthe cost of such repairs and restoration; (iii) such restoration and repair shall be accomplished in accordance with the s4andard eequirements and conditions of Bank when monitoring and advancing in connection with a construction loan of similar size and complexity; (iv) all guarenties of the Debt, or any portion thereof, shall remain in full force and effect and such Guarentors shall so confirm to Bank if requested by Bank; and (v) Grentor shall have provided to Bank satisfactory evfdence that there has been no adverse change in the economic viability of the Mortgaged Property since the date of this Deed of Trust. The Improvements shall be repaired and restored so as to be of at least equal value in substantially the same character as prior to such damage or destrucfion. If such proceeds are made available by Bank to Grantor, any surplus which may remain out of said insurance proceeds after payment of all costs and expenses of such repair and restoration shall, at the option of Bank, be applied as a prepayment of the Note but without incurring any prepayment penalty. The foregoing provisions in this Seciion are subject to contrarytertns and conditions contained in the Ground Lease and any other Lease which predates this Deed of Trust; provided, however, Bank shall be entitled to receive and aPply (as set forth above) any and all casualty insurance proceeds to which Grantor would otherwise be entitled underthe Ground Lease. (� Condemnation. Immediately upon obtaining knowledge of the institution of any proceedings for the condemnation of the Mortgaged Property or any portion thereof, or any other proceedings arising out of injury or damage to the Mortgaged Property, or any portion thereof, Grantorwill notify Bank of the pendency of such proceedings. Grantor shall, at its expense, diligently prosecute any such proceedings, and shail consult with Bank, its attomeys and experts, and cooperate with them in the carrying on a defense of any such proceedings. All proceeds of condemnation awards or proceeds of sale in lieu of condemnation with respect to the Mortgaged Property and all judgments, decrees and awards for injury or damage to the Mortgaged Property shall be paid to Bank and shall be applied, first, to reimburse Bank for all costs and expenses, including, without limitation, reasonable attorneys' fees, incurred in connection with collection of such proceeds and, second, the remainder of said proceeds shall be applied, at the sole discretion of Bank, to the payment of the Indebtedness (without premium or penaity) in the order determined by Bank in its sole discretion or paid out to repair or resiore the Mortgaged Property so affected by such condemnation, injury or damage in the same manner as provided in Subsection (e) of this Section 3.2. In any event the unpaid portion of the Indebtedness shall remain in full force and effect and Grantor shall not be excused in the payment thereof. Grantor hereby assigns and transfers all such proceeds, judgments, decrees and awards to Bank and agrees to execute such further assignments of all such proceeds, judgments, decrees and awards as Bank may request. Bank shall not be, in any event or circumstances, liable or responsible for the failure to coilect, or the failure to exercise diligence in the collection of, any such proceeds, judgments, decrees or awards. The foregoing provisions in this 5ection are su6ject to contraryterms and conditions contained in the Ground Lease and any other Lease which predates this Deed of Trust; provided, however, Bank shall be entitled to receive and retain the proceeds of any and all condemnation awards to which Grantor is entitled under the terms of the Ground Lease or otherwise and apply such as set forth above. (g) Appraisal. if at any time during the term of the Note, or during any renewal period, Bank deems it necessary to have the Land and Improvements appraised, Grantor agrees to such and acknowledges that Grantor will bear the cost of the new appraisal; rop vided, however, Grantor shall not be liable for the cost of more than one (1) appraisal during any three (3) year period unless the requirement of an appraisal is caused, in whole or in part, by an Event of Default. Bank will deem it necessary to obtain a new appraisal if there is an Event of Default under this MoRgage, or if deterioration of the financial condition of Grantors occurs, or if deterioration of the value of the Land and Improvements occurs caused by economic conditions or physical obsolescence and a new appraisal is therefore required by applicable banking statutes or regulations. - 7 - sseis�.z (aro��os) (h) Financial Statements. Borrower shall deliverto Bank, as soon as available and in any event within sixty (60) days after the last day of each fiscal year, financial statements, which shall include a balance sheet and, as appiicable, retated statements of income, retained eamings, and contingent liabilities showing the financial condition of Borrower as of and for such year, certified as true and correct by Borrower. In addition, Borrower wiil provide to Bank a true, correct and complete copy of the federal income ta�c retum for Borrower and a true and correct copy of each amended taz return within thirly (3D) days after the filing of each such tax retum. (i) Escrow. If requested by Bank at any time during the term the Indebtedness is outstanding in order to secure the pertortnance and discharge of Grantor's obiigations under 5ubsections (c) (as to Impositions) and � of this 5ection 3.2, but not in lieu of such obligations, Grantor will deposit with Bank a sum equai to ad valorem taxes, assessments and charges against the MoRgaged Property for the current year and the premiums for such policies of insurance for the current year, all as estimated by Bank and prorated to the end of the calendar month foilowing the month during which this Deed of Trust is executed and delivered, and the2after will deposit with Bank, on each date when an installment of principal and/or interest is due on the Note, sufficient funds (as estimated from time to time by Bank) to permit Bank to pay, at least fifteen (15) days prior to the due date thereof, the next maturing ad valorem taxes, assessments and charges and premiums for such policies of insurance. All such funds so deposited shall bear no interest; rop vided, however, that, if an Event of Default (as hereinafter defined) shall have occurred, suoh funds may at Bank's option be applied to the payment of the Indebtedness. If funds on deposit with Bank are insufficient to make all payments due, Grantor will deposit with Bank the amount of any deficiency. (j) FurtherAssurances. Grantorwill, on request of Bank, promptly (i) correct any defect, error oromission which may be discovered in the contents of this Deed of Trust or in any other instrument now or hereafter executed in connection herewith or in the execution or acknowledgment thereof; (ii) execute, acknowiedge, authorize, deliver and reoord or file such further instruments (including, without limitation, furtherdeeds of trust, security agreements, financing statements, continuation statements and assignments of rents and leases) and do such fuRher acts as may be necessary, desirable or proper to carry out more effectiveiy the purposes of this Deed of Trust and such other instruments and to subject to the liens and security interests hereof and thereof any property intended by the terms hereof and thereof to be covered hereby and thereby including, without limitation, any renewals, additions, substitutions, �eplacements or appurtenances to the Mortgaged Property; (iii) execute, acknowiedge, deliver, procure and record or file any document or instrument (including, without limitation, any financing statement) deemed advisable by Bank to protect the lien or the security interest hereunder against the rights of interests of third persons; and (iv) provide such certifi�ates, documents, reports, information, a�davits, appraisals, credit reports and other instruments and do such further acts as may be reasonabiy necessary, desirable orproper in the reasonable determination of Bank to assure Grantor's and Borrower's performance under the Loan Documents and Grantor will pay all costs connected with any of the foregoing. In addifion, Grantor and Borrower authorize Bank to obtain credit information about Grantor and Borrower from time to time (for example, by requesting a credit report) and to report to others Bank's credit experience with Grantor and Borrower (such as a credit repoRing agency). (k) Fees and Expenses. Subject to any applicable limitations provided in the other Loan Documents, Grantor will pay all,appraisal fees, filing and rewrding fees, inspection fees, survey fees, taxes, brokerage fees and commissions, abstract fees, title policy fees, uniform commercial code search fees, escrow fees, reasonable attomeys' fees, and all other costs and expenses of every character incurred by Grantor or Bank in connection with the Indebtedness, either at the closing thereof or at any time during the tertn thereof, or otherwise attributable or chargeable to Grantor as owner of the Mortgaged Property, and will reimburse Bank for all such costs and expenses incurred by Bank. Grantor shall pay all expenses and reimburse Bank for any expenditures, including, without limitation, reasonable attorneys' fees and legal expenses, incurred or expended in connection with (i) the breach by Grantor of any covenant herein or in any other Loan Document; (ii) Bank's exercise of any of its rights and remedies hereunder or under the Note or any other Loan Document or Bank's protection of the Mortgaged Property and its lien and security interest therein; or (iii) any amendments to this Deed of Trust, the Note or any other Loan Document or any matter requested by Grantor or any approval required hereunder. G2ntorwill indemnify and hold harmless Trustee and Bank (for purposes ofthis Subsection, the tertns "Trustee" and "Bank" shall include the directors, ofFcers, partners, employees, representatives and agents of Trustee and Bank, respectively, and any persons or entities owned or controlled by, owning or controlling, or under common control or affiliated with Trustee and Bank, respectively) from and against, and reimburse them for, all claims, demands, liabilities, losses, damages, causes of action, judgments, penalties, costs and expenses (including, without limitation, reasonable attorneys' fees) which may be imposed upon, asserted against or incurred or paid by them by reason of, on account of or in connection with any bodily injury or death or property damage occurring in or upon or in the vicinity of the Mortgaged Property through any cause whatsoever or asserted against them on account of any act performed or omitted to be performed hereunder or on account of any transaction arising out of or in any way connected with the Mortgaged Property or with this Deed of Trust, the Note or any other Loan Document. WITHOUT LIMITATION OF THE FOREGOING, IT IS THE INTENTION OF GRANTOR AND GRANTOR AGREES THAT THE FOREGOING INDEMNITIES SHALL APPLY TO EACH INDEMNIFIED PARTY WITH RESPECT TO CLAIMS, DEMANDS, LIABILITIES, LOSSES, DAMAGES, CAUSES OF ACTION, JUDGMENTS, PENALTIES, COSTS AND EXPENSES (INCLUDING, WITHOUT LIMITATION, REASONABLE ATTORNEYS' FEES) WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF THE NEGLIGENCE OF SUCH (ANDlOR ANY OTHER) INDEMNIFIED PARTY. HOWEVER, SUCH INDEMNITIES SHALL NOTAPPLY TO ANY �NDEMNIFIED PARTY TO THE EXTENT THE 5UBJECT OF THE INDEMNIFICATION 15 CAUSED BY OR ARI5ES OUT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNIFIED PARTY. The foregoing indemnities shall not terminate upon release, foreclosure or other termination of this Deed of Trust but will survive foreclosure of this Deed of Trust or conveyance in lieu of foreclosure and the repayment of the Indebtedness and the discharge and release of this Deed of Trust and the other Loan Documents. Any amount to be paid hereunder by Grantor to Bank and/or Trustee shall be subject to and governed by the provisions of 5ection 3.3 hereof. - $ - 5591612 (8/07/06) (f) Warranty. Grantorwill warrant and foreverdefend the title to the Mortgaged Property against the claims of all persons making any claim to fhe same or any part thereof, subject to the Pertnitted Encumbrances. (m) Permitted Encumbrances. Grantorwili compfy with and will perfortn all of the covenants, agreements and obligations imposed .upon it or the Mortgaged Property in the Permitted Encumbrances in accordance with their respective terms and provisions. Grantor will not modiiy or permit any modification of any Permitted Encumbrance without the prior written consent of Bank. (n) Title Policy. If requested by Bank, Grantor shall, at its sole cost and e�ense obtain and maintain a Titie Policy issued by a title company acceptable to Bank. (o) No Other Liens. Taking into account the Ground Lease, Grentor will not, without the prior written consent of Bank, create, place or permit to be created or placed, or through any act orfailure to act, acquiesce in the placing of, or ailowto remain, any deed oftrust, mortgage, voluntary or involuntary lien, whether statutory, constitutional or contractual (except for the lien for ad valorem taxes on the Mortgaged Property which are not delinquent), security interest, encumbrance or charge, or conditional sale or other title retenfion document, against or covering the Mortgaged Property, or any paR thereof, other than the Permitted Encumbrances, regardiess of whether the same are expressly or otherwise subordinate to the lien or security interest created in this Deed of Trust, and should any of the foregoing become attached hereafter in any manner to any part of the Mortgaged Property without the prior written consent of Bank, Grantor will cause the same to be promptly discharged and released. (p) No Disposition. Grantor will not make a Disposition without obtaining Bank's prior written consent to the Disposition. The Ground Lease does not constitute a Disposition. (q) Intentionally Omitted. (r) Environmental. Grantor shall not cause or permit the MoRgaged Property or Grantor to be in viofation of, or do anything or permit anything to be done which will subject the Mortgaged Property to any remedial o6ligations under, any Environmental Laws, assuming disclosure to the applicable governmental authorities of all relevant facts, conditions and circumstances, if any, pertaining to Grantor and/or the Mortgaged Property, and Grantor will promptly notify Bank in writing of any existing, pending or, to the best knowledge of Grantor, threatened investigation or inquiry by any govemmental authority in connection with any Environmental Laws. Grantor shall obtain all permits, ficenses or similar authorizations to construct, occupy, operate or use any Improvements, Fixtures and equipment fortning a part of the Mortgaged Property by reason of any Environmental Laws. Grantor shall take all steps necessary to determine that no Hazardous 5ubstances are being disposed of or otherwise released on or to the Mortgaged Property. Grantor shall not cause or permit the disposal or other release of any Hazardous Substances on or to the Mortgaged Property and covenants and agrees to keep or cause the Mortgaged Property to be kept free of ail Hazardous Substances and to remove the same (or if removal is prohibited by law, to take whatever action is required by law) promptly upon discovery at its sole expense. Upon Bank's reasonable request, at any time and from time to time during the existence of this Deed of Trust (but not more frequenUy than once every twenty-four (24) months), Grantorwill provide at Grantors sole e�ense an inspection oraudit of the Mortgaged Property from an engineering or consulting firm approved by Bank, indicating the presence or absence of Hazardous Substances on the Mortgaged Property. If Grantor fails to provide same after forty-five (45) days' notice, Bank may order same, and Grantor grants to Bank and its agents, employees, contractors and consultants access to the Mortgaged Property and a license (which is coupled with an interest and irrevocable while this Deed of Trust is in effect) to perform inspections and tests. The cost of such inspections and tests shall be a demand obligation owing by Grantor to Bank pursuant to this Deed of Trust and shali be subject to and covered by the provisions of Section 3.3 hereof. Grantor shall give prompt written notices to Bank of: (i) any proceeding or inquiry by any govemmental or nongovemmental entity or person with respect to the presence of any Hazardous Substances on, under, from or about the Mortgaged Property; the migration thereof from or to other property; the disposal, storage, or treatment of any Hazarclous Substances generated or used on, under or about the MoRgaged Property; (ii) all claims made or threatened by any third pariy against Grantor or the Mortgaged Property or any other owner or operator, including a tenant, of the Mortgaged Property relating to any loss or injury resulting from any Hazardous Substances; and {iii) Granto�s discovery of any occurrence or condition on any real property adjoining or in the vicinity of the Mortgaged Property that could cause the Mortgaged Property or any part thereof to be subject to any investigation or cleanup pursuant to any Environmental Laws. If any remedial work ("Remedial Work") is reasonably necessary or desirable, Grantor shall commence and thereafter diligently prosecute to completion all such Remedial Work within thirty (30) days (or longer period if Bank believes such is necessary in Bank's reasonable discretion) after written demand by Bank for performance thereof (or such shorter period of time as may be required under any Environmental Laws). All Remedial Work shafl be pertormed by contractors approved in advance by Bank, and under the supervision of a consulting engineer approved by Bank. All costs and expenses ofsuch Remedial Work shall be paid by Grantor including, without limitation, Bank's reasonable attorneys' fees and costs incurred in connection with monitoring or review of such Remedial Work. 3.3 Right of Bank to Perform. If Grantor fails to perform any act or to take any action which Grantor is required to perForm or take hereunderor under any of the other Loan Documents, or to pay any money which Grantor is required to pay hereunder or under any of the other Loan Documents, or takes any action prohibited hereby or thereby, Bank, in Grantor's name or in its own name, may, but shall not be obligated to, after providing Grantor with written notice of Bank's intent, perForm or cause to be performed such act ortake such action. Bank's performance, as set forth in the preceding sentence, will notwaive Grantor's default. Any amounts due and owing by Grantor to Bank pursuant to this Deed of Trust (including amounts payable pursuant to indemnity provisions) shall be payable on demand, shall bear interest from the date such amount becomes due until paid at the Maximum Rate, shall be a part of the Indebtedness, and shall be secured by this Deed of Trust. - 9 - 5591612 (8/07/O6) 3.4 fndemnification Regarding Environmental Matters. Grantor agrees to indemnify and hoid Bank and Trustee (for purposes ofthis Section, the terms "Bank" and "Trustee" shall include the directors, officers, partners, employees, repressntatives and agents of Bank and Trustee, respectively, and any persons or entities owned or controlled by, owning or controlling, or under common control or otherwise affifiated with Bank and Trustee, respectively) harmless from and against, and to reimburse Bank and Trustee with respect to, any and all claims, demands, losses, damages (including consequential damages), liabilities, causes of action, judgments, penalties, costs and expenses (including attomeys' fees and court costs) of any and every kind or character, known or unknown, fixed or contingent, imposed on, asserted against or incurred by Bank and/or the Trustee at any time and from time to iime by reason of, in connection with or arising out of (a) the breach of any representation or warranty of Grantor as set forth herein regarding Environmental Laws, (b) the failure of Grantor to perfortn any obligation herein required to be pertormed by Grantor regarding Environmental Laws, (c) any violation on or before the Release Date (defined below) of any Environmental Laws in effect on or before the Release Date, (d) the removal of Hazardous Substances from the Mortgaged Property (or if removal is prohibited by law, the taking of whatever action is required by law), (e) any act, omission, event or circumstance ebsting or occurring on or prior to the Release Date (including, without limitation, the presence on the Mortgaged Property or release from the Mortgaged Property of any Hazardous Substances on or prior to the Release Date), resulting from or in connection with the ownership, construction, occupancy, operafion, use and/or maintenance of the Mortgaged Property, regardless of whether the act, omission, event or circumstance constituted a violation of any Environmental Law at the time of its ebstence or occurrence, and (fl any and all claims or proceedings (whether brought by private party or govemmental agency) for bodily injury, property damage, abatement or remediation, environmental damage or impairtnent or any other injury or damage resulting from or relating to any hazardous substance or solid waste located upon or migrating into, from or through the Mortgaged Property (whether or not any or all of the foregoing was caused by Grantor or its tenant or subtenant, or a prior owner of the Mortgaged Property or its tenant or subtenant, or any third party and whether or not the alleged liability is attributable fo the handling, storage, generafion, transportation or disposal of such substance or waste or the mere presence of such substanceorwasteontheMortgagedProperty). WITHOUTLIMITATION,THEFOREGOINGINDEMNITIE5SHALLAPPLYTOEACH INDEMNIFIED PARTY WITH RESPECT TO CLAIMS, DEMANDS, LOSSES, DAMAGES (INCLUDING CONSEQUENTIAL DAMAGES), LIABILITIES, CAUSES OF ACTION, JUDGMENTS, PENALTIES, COSTS AND EXPENSES (INCLUDING ATTORNEYS' FEES AND COURT COST5) WHICH IN WHOLE OR IN PART ARE CAUSED BY ORARISE OUT O�F THE NEGLIGENCE OF 5UCH (AND/OR ANY OTHER) INDEMNIFIED PARTY OR WHICH ARISE AS A RESULT OF STRICT LIABILITY, WHETHER UNDER APPLICABLE ENVIRONMENTAL LAWS OR OTHERWISE. HOWEVER, 5UCH INDEMNITIES SHALL NOT APPLY TO ANY INDEMNIFIED PARTY TO THE EXTENT THE SUBJECT OF THE INDEMNIFICATION IS CAUSED BY OR ARISES OUT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNIFIED PARTY. The term "Release Date" as used herein shall mean the earlier of the following two dates: (a) the date on which the Indebtedness has been paid and perfortned in full and this Deed of Trust has been released, or (b) the date on which the lien of this Deed of Trust is foreclosed or a conveyance by deed in lieu of such foreclasure is fully effective; provided, if such payment, performance, release, foreclosure or conveyance is challenged, in bankruptcy proceedings or othervvise, the Release Date shall be deemed not to have occurred until such challenge is rejected, dismissed or withdrawn with prejudice. The foregoing indemnities shall not tertninate upon the Release Date or upon the release, foreclosure or other termination of this Deed of Trust but will survive the Release Date, foreclosure of this Deed of Trust or conveyance in lieu of foreclosure, and the repayment of the Indebtedness and the discharge and release of this Deed of Trust and the other Loan Documents. Any amount to be paid hereunder by Grantor to Bank and/or Trustee shall be a demand obligation owing by Grantor to Bank and/or Trustee and shall be subject to and covered by the provisions of Section 3.3 hereof. 3.5 Ground Lease. Grantor hereby acknowledges and agrees that this Deed of Trust will cover all of the Grantors right, title, interest and estaie under the Ground Lease and in and to all items and interests, other than the interests of the lessor under the Ground Lease, pertaining to or used in connection with the Land, Improvements, Minerals, Fixtures, Personalty, Contracts, and Leases, as well as other items herein described. Grantor hereby represents and warrants that the Ground Lease is in fuil force and effect and has not been modified or amended in any manner whatsoever except as disclosed to Bank; there are no defaults under the Ground Lease and no event has occurred which, but for the passage of time or notice or both, would constitute a default under the Ground Lease; all rents, additional or contingent rents and othersums due and payable underthe Ground Lease have been paid in full; and no action has commenced and no notice has been given or received for the purpose of terminating the Ground Lease or any right, title or interest therein. Grantor, as lessee under the Ground Lease, further covenants and agrees as follows: (a) Performance of Covenants. Grantor shall perfortn or observe diligently and timely each and every covenant, term or condition to be performed or observed by the lessee under the Ground Lease. (b) Notice of Default. Grantor shall give immediate notice to Bank of any default within Grantors knowledge by Grantor, as lessee under the Ground Lease, or by the lessor under the Ground Lease, or of the receipt by Grantor of any notice of default from the lessor under the Ground Lease, and shall fumish to Bank all information and documentation that it may require in respect of the performance or non-perFormance by Grantor under the terms, conditions and covenants of the Ground Lease. (c) Attomey in Fact. Grantor hereby irrevocably designates and appoints Bank its agent and attomey-in-fact to perform or observe on behalf of Grantor, without any notice to Grantor, any covenant or condition which Grantor fails to perform or observe under the Ground Lease within the grace periods specified therein. Without limiting the generality of the other provisions of this Deed of Trust, and without waiving or releasing Grantor from any of Grantors obligations hereunder, Bank shall have the right, but shall be under no obligation, to pay any sums and to perForm any act or take any action as may be appropriate to cause all of the terms, covenants and conditions of the Ground Lease on the part of Grantor, as lessee thereunder, to be performed or observed to be promptly performed or observed on behalf of Grantor, to the end that the rights of Grantor in, to and under the Ground Lease shall be kept unimpaired and free from default. If Bank shall make any payment or perform any act ortake action in accordance with the preceding sentence, Bankwill thereafter notify Grantor of the making of any such payment, the performance of any such act, or taking of any such action. In any such event, except to the extent expressly prohibited by the terms and provisions of the Ground Lease, Bank and any person designated by Bank shall have, _ �p _ sseiei.z �aio�ios� and are hereby granted, the right to enter upon the Land and Improvements at any time and from fime to time for the purpose of taking any such action. Any advances made by Bank in connection with such pertormance or observan�e shall be immediately due and payable by Grantor with interest thereon at the Maximum Rate from the date advanced to the date paid by Grantor and shall be secured by the fien of this Deed of Trust. The pertormance or observance of such covenant or condition by Bank shall not prevent Grantor's failure so to perfortn or observe from constituting an Event of Default. (d) Renewal Options. Grantor shall exercise, within the times allowed in the Ground Lease, each and every option or right to extend or renew the terms thereof, which right or option occurs prior to the maturity of the Note and the release of this Deed of Trust, and shall deliver to Bank a copy of the notice to Grantor, as lessee under the Ground Lease to exercise each such opfion simultaneously with the delivery of same to Grantor, as lessee under the Ground Lease. After an Event of Default occurs and continues, Bank shall have the right, exercisable at any time with or without notice to Grantor and regardless of whether Grantor has failed to exercise timely any such option, to exercise any such option in the place and stead and on behalf of Grantor, and Grantor hereby irrevocably designates and appoints Bank as its attomey-in-fact to so exercise such option or options. (e) Dual Obligations. The provisions of this Deed of Trust shall be deemed to be obligafions of Grantor in addition to Grantot's obligations as lessee with respect to similar matters contained in the Ground Lease, and the inclusion herein of any covenants and agreements relating to similar matters underwhich Grantor is obligated underthe Ground Lease shail not restrict or limit Grantor's duiies and obligations to keep and perform promptfy ail of its covenants, agreements and obfigations as lessee under the Ground Lease; provided, however, nothing in this Deed of Trust shall be construed as requiring the taking of or the committing to take any action by Grantor which would cause a default under the Ground Lease. (� No Merger. So long as this Deed of Trust is in efFect, there shall be no merger of the Ground Lease or any interest therein, nor of the leasehold estate created thereby with the fee estate in the Land or any portion thereof by reason of the fact that the Ground Lease or such interest therein or such leasehold estate may be held directly or indirectly by or for the account of any person who shali hold the fee estate in the Land or any portion thereot. In the event that Grantor acquires or becomes the holder of the fee titie or any other estate, title or interest in the Land or any part of the Mortgaged Property this Deed of Trust shall attach to and cover and be a lien on such other estate, title or interest and such other estate, title or interest shall, without further assignment, mortgage or conveyance, become and be subject to the lien of and covered by this Deed of Trust. (g) Amendmentto Ground Lease. No surrender (except a surrenderupon the e�iration of the term ofthe Ground Lease) shall be valid or effective, and neither the Ground Lease nor any of the terms, covenants or conditions thereof may be amended, modified, changed, surrendered or canceled, either orally or in writing, without the prior written consent of Bank so long as this Deed of Trust is in effect. (h) Conditional Assignmentto Bank. Grantor hereby assigns to Bank, as furthersecurity forthe payment of the Indebtedness and performance of the Obligations, all of the rights and privileges of Grantor, as lessee under the Ground Lease, to surrender the leasehoid estate created by the Ground Lease or to terminate, cancel, modify, change, supplement, alter or amend the Ground Lease, provided that Bank may not exercise the foregoing rights unless there has been an Event of Default. ARTICLE FOUR AS5IGNMENT OF RENTS AND CONTRACTS 4.1 Assignment of Rents. In order to secure payment and perFormance of the Indebtedness and the Obligations, Grantor does hereby absolutely and unconditionally assign, transfer and set over to Bank all Rents and all proceeds and other amounts paid or owing to Grantor under or pursuant to any and all Contracts and bonds relating to the construction, erectio� or renovation of the Morigaged Property; subject however to a license hereby granted by Bank to Grantor to collect and receive all of the foregoing (such license evidenced by Bank's acceptance of the Deed of Trust), subject to the terms and conditions hereof. Notwithstanding anything contained herein or in any of the other Loan Documents to the contrary, the assignment in this Section is an absolute, unconditional and presently effective assignment and not merely a security interest; rop vided, however, upon the occurrence of an Event of Default (as hereinafter defined) hereunder or upon the occurrence of any event or circumstance which with the lapse of time or the giving of notice or both would constitute an Event of Default hereunder, such license shall automatically and immediately terminate; rop vided, however, that Bank shall not be deemed to have taken possession of the Mortgaged Property except on the exercise of its option to do so, evidenced by its demand and overt act for such purpose. It shall not be necessary for Bank to institute any type of legal proceedings or take any other action whatsoever to enforce the assignment provisions in this Section 4.1. 4.2 Assignment of Lease Guaranties and Other Property. In order to secure payment and performance of the Indebtedness and Obligations, Grantor hereby assigns to Bank all existing and future Lease Guaranties, all claims and rights to the payment of damages and other claims arising from any rejection by a lessee of any Lease under the United States Bankruptcy Code (a "Bankruptcy Claim"), all proceeds from the sale or other disposition of the Leases, the Rents, the Lease Guaranties, the Bankruptcy Claims, and all other rights and benefits of Grantor as Lessor under the Leases and under the Lease Guaranties, plus all amendments, replacements, and renewals of the foregoing. Prior to an Event of Default, Grantor shall have the right, without joinder of Bank, to enforce the Leases, unless Bank directs othervvise. - 11 - sssisi.z (aio�ios) 4.3 Warrenties Conceming Leases and Rents. Grantor represents and warrants that: (a) Grantor has good title to the Leases and Rents and authority to assign the property described above, and no other person or entiiy has any righf, title or interest therein; (b) ali epsting Leases are valid, unmodified and in full force and effect, except as inrlicated herein or in a separate document provided to Bank by Granto�, and to Grantors knowledge, no default exists thereunder, (c) unless otherwise provided herein, no Rents have been or will be assigned, mortgaged or pledged; and (d) no Rents have been or will be anticipated, waived, released, discounted, set off or compromised except for prudent business reasons. 4.4 Grantor's Covenants of Pertormance. Grantor covenants to: (a) perform all of its obligations under the Leases; (b) enforce the tenanYs obligafions under the Leases; (c) defend, at Grantor's expense, any proceeding pertaining to the Leases, including, if Bank so requests, any such proceeding to which Bank is a party; and (d) neither create nor permit any encumbrance upon its interest as lessor of the Leases, except this Deed of Trust and any other encumbrances permitted by this Deed of Trust. 4.5 Prior Approval for Actions Affecting Leases. Grantor shall not, without the prior written consent of Bank: (a) receive or collect Rents more than one month in advance; (b) encumber or assign future Rents; (c) waive or release any obligation of any tenant under the Leases except for prudent business reasons; (d) cancel, terminate or modify any of the Leases, cause ot permit any cancellation, termination or surrender of any of the Leases, or commence any proceedings for dispossession of any tenant under any of the Leases, except upon default by the tenant thereunder or except for prudent business reasons; or (e) permit any assignment of the Leases or of the other property pledged to Bank under this Article Four. 4.6 Bank in Possession. Bank's acceptance of this assignment shall not, prior to entry upon and taking possession of the Mortgaged Property by Bank, be deemed to constitute Bank a"mortgagee in possession," nor obligate Bank to appear in or defend any proceedings relating to any of the Leases or to the Mortgaged Property, take any action hereunder, expend any money, incur any expenses, or perform any obligation or liability under the Leases, or assume any obligation for any deposits delivered to Grantor by any tenant and not delivered to Bank. Bank shall not be liable for any injury or damage to any person or property in or about the Mortgaged Property. 4.7 Indemnification. Grantor hereby indemnifies and holds Bank (which shall include the directors, officers, partners, employees, representatives and agents of Bank and ariy persons or entities owned or controlled by, owning or controlling, or under common control or a�liated with Bank) harmless from all liability, damage or expense imposed on or incurred by Bank from any claims under the Leases. In additio�, Grantor shall have no right or claim against any Lessee for the payment of any Rent to Bank pursuant to provisions in Article Four of this Deed of Trust. The foregoing indemnities shall not terminate upon the foreclosure, release or other termination of this Deed of Trust but will survive foreclosure of this Deed of Trust or conveyance in lieu of foreclosure and the repayment of the Indebtedness and the discharge and release of this Deed of Trust and the other Loan Do�uments. 4.8 Merger. There shall be no merger of the leasehold estates, created by the Leases, with the fee estate of the Land without the prior written consent of Bank. 4.9 RighttoRely.GrantorherebyirrevocablyauthorizesanddirectsthetenantsundertheLeasestopayRentstoBank upon written demand by Bank without further consent of Grantor, and the tenants may rely upon any written statement delivered by Bank to the tenants. Any such payment to Bank shall constitute payment to Grantor under the Leases. The assignment of Rents set forth in Section 4.1 is not contingent upon any notice or demand by Bank to the tenants. 4.10 Termination of Assignme�t. Upon payment in full ofthe indebtedness and the delivery and recording of a release of the Deed ofTrust lien created by this Deed ofTrust duly executed by Bank, the assignments described above in this ARicle Four shall become null and void and shall be of no further force and effect. 4.11 Waiver. Failure ordiscontinuance by Bank, at any time orfrom time to time, to collect Rents shali not in any manner impair the subsequent enforcement by Bank of the right, power and authority herein conferred upon Bank. _ 12 _ sssis�2 �aio�loa� ARTICLE FIVE EVENTS OF DEFAULT Deiaults. The term "Event of Default" as used in this Deed of Trust shall mean the occurrence of any of the following events (but subject to any appficable cure and/or gra�e period): 5.1 Failure to Pay fndebtedness. The failure, refusal or neglect of Grantor to make due and punctual payment of principal or interest on the Indebtedness, or any portion thereof, as the same shall become due and payable; or 5.2 Non-Pertormance of Covenants. The failure of Grantor to timefy and properiy otrserve, keep or pertorm any covenant, agreement, warranty or condition required herein; or 5.3 False Representation. Any representation contained herein or in any other Loan Document or otherwise made by Grantor to Bank in connection with the Indebtedness and Loan Documents is false or misleading when made in any material respect; or 5.4 Bankruptcy or Insolvency. If the owner of the Mortgaged Property or any person obfigated to pay the Indebtedness: (a) becomes insolvent, or makes a transfer in fraud of creditors, or makes an assignment for the benefrt of creditors, or admits in writing its inability to pay its debts as they become due; (b) generaliy is not paying its debts as such debts become due; (c) has a receiver, trustee or custodian appointed for, or take possession of, all or substantially all of the assets of such party or any of the Mortgaged Property, either in a pro�eeding brought by such party or in a proceeding brought against such party and such appointment is not discharged or such possession is not terminated within sixty (60) days after the effective date thereof or such party consents to or acquiesces in such appointment or possession; (d) files a petition for relief under the United States Bankruptcy Code or any other present or future Debtor Relief Law or an involuntary petition for relief is filed against su�h party under any Debtor Relief Law and such involuntary petition is not dismissed within sixty (60) days after the filing thereof, or an order for relief naming such party is entered under any Debtor Relief Law, or any composition, rearrangement, extension, reorganization or other relief of debtors now or hereafter e�asting is requested or consented to by such party; (e) fails to have discharged within a period of sixty (60) days any attachment, sequestration or similar writ Ievied upon any property of such party; or (fl fails to pay within thirty (30) days any final money judgment against such parly; or 5.5 Action by Other Lienholder. The holder of any lien or security interest on the Mortgaged Property (without hereby implying the consent of Bank to the existence or creation of any such lien or security interest) declares a default thereunder or institutes foreclosure or otMer proceedings for the enforcement of its remedies thereunder, or 5.6 Disposition of Mortgaged Properly. Without the prior written consent of Bank, Grantor makes a Disposition, it being understood that the consent of Bank to a Disposition required hereunder may be refused by Bank in its sole discretion; or 5.7 Other Liens. Without the priorwritten consent of Bank, Grantor creates, places or permits to be created or placed, or through any aot orfailure to act, acquiesces in ihe placing of, or allows to remain, any deed of trust, mortgage, voluntary or involuntary lien, whether statutory, constitutional or contractual (except for the lien for ad valorem taxes on the Mortgaged Property which are not delinquent), security interest, encumbrance or charge, or conditional sale or other title retention document, against or covering the Mortgaged Property, or any part thereof, other than the Permitted Encumbrances, regardless of whether the same are expressly or otherwise subordinate to the Iien or security interest created in this Deed of Trust, or acquires any Fixtures, equipment or other property forming a part of the Mortgaged Property pursuant to a lease, license or similar agreement; or 5.8 Liquidation, Merger, orChange in Ownership. Borrowerdissolves, liquidates, mergesorconsolidatesvoluntarily or involuntarily; or 5.9 Transfer of Assets. Grantor (eases, sells, or otherwise transfers all, or a substantial portion, of its assets, property or business, without receiving fair and adequate consideration; or 5.10 Death. If (either) Grantor dies; or 5.11 Condemnation. Any condemnation proceeding is instituted orthreatened which would, in Bank's solejudgment, materially impair the use and enjoyment of the Mortgaged Property for its intended purposes; or 5.12 Destruction of Improvements. The Mortgaged Property is demolished, destroyed, or substantially damaged so that, in Bank's sole judgment, it cannot be restored or rebuilt with available funds to the condition existing immediately prior to such demolition, destruction, or damage within a reasonable period of time; or 5.13 Other Contracts. If a"Default" or "Event of Default" occurs under any other written agreement between Bank and Grantor or Bank and Borrower; or 5.14 Default Under Ground Lease. Subject to all applicable periods of grace and cure, if Grantor defaults in the observance or perFormance of any term, covenant or condition of the Ground Lease on the part of Grantor, as lessee thereunder, to be observed or performed; or if any one or more of the events referred to in the Ground Lease shall occur which would cause the Ground Lease to terminate without notice of action by the lessor thereunder or which would allow the lessor to terminate the Ground Lease by giving notice to Grantor as lessee thereunder; or if the leasehold estate created by the Ground Lease shall be surrendered, terminated, - �3 - sseisi.z (eio�roa) or canceled; or if any of the terms, covenants or conditions of the Ground Lease shall in any manner be modified, changed, suppiemented, altered or amended without the express prior written consent of Beneficiary. ARTICLE SIX REMEDIE5 AND RELATED RIGHTS If an Event of Default shall occur, Bank may exercise any one or more of the foliowing remedies and shall, in addition to any other rights, have the following related rights, without notice (unless noiice is required by Legal Requirements): 6.1 Acceleration. Upon the occurrence of an Event of Default, Bank shall have the option ofdeclaring all Indebtedness in its entirety to be immediately due and payable, and the liens and security interests evidenced hereby shall be subject to foreclosure in any manner provided for herein or provided for by applicable law as Bank may elect. If, after maturity of the Indebtedness (whether by acceleration, default or otherwise) and prior to the sale of the Mortgaged Property under this Deed of Trust, Bank re�eives any partial payment on the Indebtedness, Bank shall be entitled to retain the amount of the payment and appiy the same to the Indebtedness, giving Grantor credit therefor, without waiving or affecting the right of Bank (and the Trustee) to proceed with foreclosure and sale under this Deed of Trust. 6.2 Foreclosure. If an Event of Default occurs, Trustee will, at the request of Bank, sell all orany part of the Mortgaged Property, all as Trustee in Trustee's discretion elects. The sale will be made in accordance with Texas Property Code ("Property Code") Section 51.002 or any successor statute. If the Land is situated in more than one county, then required notices will be given in both or all of such counties, the Mortgaged Property may be sold in either or any such county, and such notices shall designate the county where the Mortgaged Property will be sold. The aifidavit of any person having knowledge of the facts to the effect that such service was completed shall be prima facie evidence of the fact of service. Any sale made by Trustee hereunder may be as an entirety or in such parcels as Bank may request, and any sale may be adjourned by announcement at the time and place appointed for such sale without further notice except as may be required by law. The sale by Trustee of less than the whoie of the Mortgaged Property shall not e�aust the power of sale herein granted, and Trustee is specifically empowered to make successive sale or sales under such power until the whole of the Mortgaged Property shall be sold; and, if the proceeds of such sale of less than the whole of the Mortgaged Property shall be less than the aggregate of the Indebtedness and the expense of executing this trust as provided herein, this Deed of Trust and the lien hereof shall remain in full force and effect as to the unsold portion of the Mortgaged Propertyjust as though no sale had been made; rop vided, however, that Grantor shall never have any right to require the sale of less than the whole of the Mortgaged Property but Bank shall have the right, at its sole election, to request Trustee to sell less than the whole of the Mortgaged Property. After each sale, Trustee shall make to the purchaser or purchasers at such sale good and sufficient conveyances in the name of Grantor, conveying the properly so sold to the purchaser or purchasers in fee simple with general warranty of title, and shall receive the proceeds of said sale or sales and apply the same as herein provided. Payment of the purchase price to Trustee shall satisfy the obligation of purchaser at such sale therefor, and such purchaser shall not be responsible for the application thereof. The power of sale granted herein shail not be exhausted by any sale held hereunder by Trustee or his substitute or successor, and such power of sale may be exercised from time to time and as many times as Bank may deem necessary until all of the Mortgaged Property has been duly sold and all Indebtedness has been fully paid. In the event any sale hereunder is not completed or is defective in the opinion of Bank, such sale shall not exhaust the power of sale hereunder and Bank shall have the right to cause a subsequent sale or sales to be made hereunder. Any and all statements of fact or other recita�s made in any deed or deeds given by Trustee or any successor or substitute appointed hereunder as to nonpayment of the Indebtedness, or as to the occurrence of any Event of Default, or as to Bank having declared all of such Indebtedness to be due and payable, or as to the request to sell, or as to notice of time, place and terms of sale and of the properties to be soid having been duly given, or as to the refusal, failure or inability to act of Trustee or any substitute or successor, or as to the appointment of any substitute or successor Trustee, or as to any other act or thing having been duly done by Bank or by Trustee or any substitute or successor, shall be taken as prima facie evidence of the truth of the facts so stated and recited. Trustee, his successor o� substitute, may appoint or delegate any one or more persons as agent to perform any act or acts necessary or incident to any sale held by Trustee, including, without limitation, the posting of notices and the conducting of sales, but in the name and on behalf of Trustee, his successor or substitute. Bank may at any time before the sale direct Trustee to abandon the sale, and may at any time thereafter direct Trustee to again commence foreciosure. Whetheror not foreclosure is commenced by Trustee; Bank may at any time after an Event of Default occurs institute suit for collection of all or any paR of the Indebtedness or foreclosure of the lien of this Deed of Trust or both. If Bank institutes suit for collection of the Indebtedness and foreclosure of the lien of this Deed of Trust, Bank may at any time before the entry of final judgment dismiss the same, and require Trustee to sell the Mortgaged Property in accordance with the provisions of this Deed of Trust. No single sale or series of sales under this Deed of Trust or by judicial foreclosure will e�ctinguish the lien o� exhaust the power of sale under this Deed of Trust except with respect to the items of propeRy sold. Trustee (including any successor trustee) will not be liable for any error of judgment or act done by such party in good faith, or be otherwise responsible or accountabie to Grantor under any circumstances. 6.3 Right to Require Proof of Financial Ability and/or Cash Bid. At any time during the bidding during a sale as described in Section 6.2, the Trustee may require a bidding parly (a) to disclose its full name, state and city of residence, occupation, and specific business office location, and the name and address of the principal the bidding party is representing (if applicable), and (b) to demonstrate reasonable evidence of the bidding party's financial ability (or, if applicable, the financial ability of the principai of such bidding party), as a condition to the bidding party submitting bids at the foreclosure sale. If any such bidding party (the "Questioned Bidde�') declines to comply with the Trustee's requirement in this regard, or if such Questioned Bidder does respond but the Trustee, in Trustee's sole and absolute discretion, deems the information or the evidence of the financial ability of the Questioned Bidder (or, if applicable, the principal of such bidding party) to be inadequate, then the Trustee may continue the bidding with reservation; and in such event (i) the Trustee shall be authorized to caution the Questioned Bidder concerning the legal obligations to be incurred in submitting bids, and (ii) ifthe Questioned Bidder is not the highest bidder at the sale, or if having been the highest bidder the Questioned Bidderfails to deliver the cash purchase price payment promptly to the Trustee, all bids by the Questioned Bidder shall be null and void. The Trustee may, in Trustee's sole and absolute discretion, determine that a credit bid may be in the best interest of Grantor and Bank, - 14 - sssie�.z �aio�ios� and elect to sell the Mortgaged Property for credit orfor a combination of cash and credit; provided, however, that the Trustee shali have no o6figation to accept any bid except an all cash bid. In the event the Trustee requires a cash bid and cash is not delivered within a reasonable time afler conclusion of the bidding process, as specified by the Trustee, but in no event later than 3:45 p_m. local iime on the day of sale, then said confingent sale shall be null and void, the bidding process may be recommenced, and any subsequent bids or sale shall be made as 'rf no prior bids were made or accepted. 6.4 Proeeeds of Sale. The proceeds of any sale held by Trustee or any reoeiver or pubfic officer in foreclosure of the liens evidenced hereby shafl be applied: FIRST, to the payment of ail necessary costs and expenses incident to such foreclosure sale, including but not limited to, all court costs and charges of every character in the event foreolosed by suit, attomeys' fees and a reasonable fee to Trustee acting under the provisions of Section 6.3 if foreclosed by power of sale as provided in said paragraph, not exceeding five percent (5%) of the proceeds of such sale; SECOND, to the payment in full of the Indebtedness (ncluding, without limitation, the principal and interest due and unpaid on the Note, attomeys' fees and any other amounts due and unpaid and owed to Bank under this Deed of Trust) in such order as Bank may elect in its sole direction; and THIRD, the remainder, if any there shall be paid to Grantor or to such other party or parties as may be entitled thereto by applicable law. 6.5 Intentionally Omitted. 6.6 Bank as Purchaser. Bank shall have the right to become the purchaser at any sale held by any Trustee or substitute or successor or by any receiver or public ofFcer, and if Bank purchases at any such sale Bank shall have the right to credit upon the amount of the bid made therefor, to the extent necessary to satisfy such bid, the Indebtedness owing to Hank. 6.7 Remedies Cumulative. All remedies herein e�ressly provided for are cumulative of any and all other remedies exisfing at law or in equity and are cumulative of any and all other remedies provided for in any of the other Loan Documents, or any part thereof, or otherwise benefitfing Bank, and Trustee and Bank shall, in addition to the remedies herein provided, be entitied to avail themselves of all such other remedies as may now or hereafter exist at law or in equity for the colle�tion of the Indebtedness and the enforcement of the covenants herein and the foreclosure of the liens and security interests evidenced hereby, and resort to any remedy provided for hereunder or under any such Loan Documents or provided for by law shall not prevent the concurrent or subsequent employment of any other appropriate remedy or remedies. ARTICLE SEVEN CONSTRUCTION OFIMPROVEMENTS 7.1 Commitment to Lend; Initial Construction Advance. Subject to and upon the terms and conditions hereinafter set forth, and at any time before, but not after the Expiration Date, upon five (5) business days prior written request therefor by Grantor, Bank will make Constrvction Advances to Grantor or for Grantors benefit for the purpose of financing, in whole or in part, the Project, so long as the Construction Advances, in the aggregate, never exceed the Construction Committed 5um. All indebtedness arising pursuant to this Deed of Trust by reason of Construction Advances shall be evidenced by the Note and shall constitute a part of the Indebtedness. 7.2 Expiration of Commitment. Bank's commitmentto make Construction Advances shall terminate on the Expiration Date; rop vided, however, Bank reserves the right to terminate its commitment to lend hereunder at any time prior to the Expiration Date upon the occurr�ence of an Event of Default. 7.3 Initial Construction Advance. Bank will not be obligated to make any Construction Advance unless and until Grantor has delivered to Bank, or Bank otherwise receives, each of the foliowing: (a) True copies of all permits, and licenses (including the building pertnit issued by the applicable Governmental Authoriiy) which Grantor obtains in connection with the Project. (b) The Approved Budget. (c) All other evidences, certificates, opinions, agreements, documents, and instruments Bank may reasonably request_ 7.4 Conditions for Eacfi Construction Advance. In addition to the conditions precedent stated elsewhere herein, Bank will not be obligated to make any Construction Advance unless: (a) On the date of the Construction Advance, no Event of Default, and no event which, with the lapse of time or notice or both could become an Event of Default, has occurred and is continuing. (b) Ail proceeds of previous Construcfion Advances shall have been spent or used only as indicated in each prior Application for Advance. - 15 - sseisi.z �eio�ios� 7.5 Items to be Delivered for Each Construction Advance. In addition to the conditions precedent stated elsewhere herein, Bank shall not be obligated to make any Construction Advance unless or until, on or prior to the date of such Construction Advance, Grantor delivers to Bank, or Bank otherwise receives, each of the following: (a) An Appfication for Advance delivered to Bank at least three (3) business days prior to the date of the requested Construction Advance. (b) At the eleciion of Bank, either (i) copies of all invoices to be paid from the requested Construction Advance, or (ii) a certificate by Grantor that ali bills have been paid or wiii be paid with the Construciion Advance. (c) An inspection and acceptable report on the construction of the improvements. (d) All conditions precedentta the obfigation of Bank to make any Construction Advance are imposed hereby solely for the benefit of Bank, and no other party may require satisfaction of any such condition precedent or be entitled to assume that Bank will refuse to make any Construcfion Advance in the absence of strid compliance with such condifions precedent. 7.6 Final Construction Advance. In addition to the conditions precedent stated elsewhere herein, Bank shall not be obligated to make the final Construction Advance unless and until Grantor delivers to Bank, or Bank otherwise receives, each of the following: (a) A certificate, affidavit, and warranty by Grantor and, if requested, supporting evidence that (i) the work on the Proje�t has been fully completed for a period of at least thirty-one (31) days lien free, and (ii) all bills for labor and material for construction or repair of ail or any part of the Project have been paid in full. (b) Insurance policies in form and amount and with companies satisfactory to Bank in accordance with the requirements of this Deed of Trust and the other Loan Documents. 7.7 Direct Construction Advan�es. With respect to the portion of each Construction Advance which is to be used to make payments to Persons other than Bank or Grantor, Bank may, at its election, make such portion of such Construction Advance directly to each such Person, and the execution of this Deed of Trust by Grantor constitutes an irrevocable direction and authorization to so advance. No further direction or authorization from Grantor shall be necessary to make such direct Constn�ction Advances to each such Person, and all such direct Construction Advances shall satisfy the obiigations of Bank hereunder and shall be and become a part of the Indebtedness as fully as if made directly to Grantor, regardiess of the disposition thereof by su�h Person. 7.8 Construction. The construction of the Project shall be prosecuted with diligence and continuity, in a good and workmanlike manner, and in accordance with sound buiiding and engineering practices, all applicable Legal Requirements, and the plans and specifications for the Project. Grantor shall complete construction of the Project not later than thirty.-one (31) days prior to the Expiration Date, free and clear of all liens (except the Permitted Encumbrances and those as to which Grantor has fumished a bond or other security acceptable to Bank). 7.9 No Liability of Bank. Bank shall have no liability, obligation, or responsibility whatsoever with respect to the construction of the Project except to advance under the Note. Bank shall not be obligated to inspect the Project or the construction of such, nor be liable for the performance or default of Grantor, or any other party, or tor any failure to construct, complete, protect, or insure the Mortgaged Properly and Project, or for the payment of costs of labor, materials, or services supplied for the construction of the Project, or for the perFortnance of any obligation of Grantor whatsoever. Nothing, inciuding without limitation any Construction Advance or acceptance of any document or instrument, shall be construed as a representation orwarranty, express or implied, to any party by Bank. 7.10 Insurance. While any part of the Project is being developed or constructed, Grantor shall maintain, or cause to be maintained, at Grantor's expense, such of the following insurance as Bank may reasonably require: (a) a builder's all-risk form insurance policy on a completed value basis; and (b) worker's compensation and general liability policies covering each contractor performing work on the Mortgaged Property. All such required insurance policies must (x) be issued by companies reasonably acceptable to Bank, (y) be indorsed to be payable to Bank as bank insured and loss payee, and (z) expressly prohibit cancellation or modification without 15 days written notice to Bank. Grantorwill promptly defiver to Bank photocopies of the original policies (including all renewals) evidencing all required insurance. 7.11 Construction Mortgage. This Deed of Trust is a"Construction Mortgaqe" under the Texas Business and Commerce Code to the extent that it secures an obligation incurred for the construction of certain improvements io the Land. ARTICLE EIGHT MISCELLANEOUS 8.1 Defeasance. If all of the Indebtedness is paid as the same becomes due and payable and rf all of the covenants, warranties, undertakings and agreements made in this Deed of Trust are kept and performed, and Grantor's ability to borrow under the Loan Documents has been terminated, then and in that event only, all rights under this Deed of Trust shall terminate and the Mortgaged Property shall become wholly clear of the liens, security interests, conveyances and assignments evidenced hereby, which shaii be released by Bank in due form at Grantor's cost. - �6 - 559�612 (8/07/06) 82 Risk of Loss; Implied Covenants. The risk of loss or damage to the Mortgaged Property is on Grantor, and Bank shall have no liabifity whatsoever for the decfine in value of the Mortgaged PropeRy, for failure to obtain or maintain irtsurance, or for failure to determine whether insurance in force is adequate as to amount or as to the risks insured. Grantor and Bank agree that there are no, nor shali there be any, implied covenants of good faith and fair dealing or other similar covenants or agreements in this Deed of Trust and the other Loan Documents. All agreed contractual duties are set forth in this Deed of Trust, the Note, and the other Loan Documents. 8.3 Successor Trustee. Trustee may be removed at any fime with or without cause, at the opfion of Bank, by written declaraiion of removal executed by Bank, without any noiice to or demand upon Trustee, Grantor or any other person. If at any time Trustee is removed, dies or refuses, fails or is unable to act as Trustee, Bank may appoint any person as successor Trustee hereunder, without any formality other than a written declaration of appointment executed by Bank. Immediately upon appointment, the successor Trustee so appointed automatically will be vested with all the estate and title in the Mortgaged Property, and with all of the rights, powers, privileges, authority, options and discretions, and charged with all of the duties and liabifities, vested in or imposed upon Trustee by this instrument, and any conveyance executed by any successor Trustee will have the same effect and validity as if executed by the Trustee named in this Deed of Trust. 8.4 INDEMNITY. GRANTOR SHALL INDEMNIFY, DEFEND, PROTECT AND HOLD HARMLESS BANK AND TRUSTEE, THEIR RESPECTIVE PARENTS, SUB5IDIARIES, DIRECTORS, OFFICERS, EMPLOYEES, REPRESENTATIVES, AGENT5, SUCCESSORS, AND ASSIGNS FROM AND AGAINST ANYAND ALL LIABILITY, DAMAGE, LOSS, COST, O R EXPENS E (INCLUDING, WITHOUT LIMITATION, ATTORNEYS' FEES AND EXPENSESj, ACTION, PROCEEDING, CLAIM OR DISPUTE INCURRED OR SUFFERED BY THE FOREGOfNG PARTIES SO INDEMNIFIED WHETHER OR NOT AS THE RESULT OF THE NEGLIGENCE OFANYPARTYSO INDEMN/FIED. (PROVIDED HOWEVER, THE INDEMNfTIES PROVIDED IN THIS SECTION 8 4 DO NOT EXTEND TO LIABILfTY DAMAGE C05TS OR CLAIMS CAUSED BY BANK'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCn WHETHERVOLUNTARILY OR INVOLUNTARILY INCURRED OR SUFFERED, IN RESPECT OF THE FOLLOWING: (a) ANY LITIGATION CONCERNING THIS DEED OF TRUST, THE OTHER LOAN DOCUMENTS ORTHE MORTGAGED PROPERTY, OR ANY INTEREST OF GRANTOR Oit BAtJIC THEREIN, OR THE RIGHT OF OCCUPANCY THEREOF BY GRANTOR OR BANK, WHETHER OR NOT ANY SUCH LITIGATION IS PROSECUTED TO A FINAL, NON-APPEALABLE JUDGMENT; (b) ANY ACTION TAKEN OR NOT TAKEN BY BANK OR TRUSTEE WHICH 15 ALLOWED OR PERMITTED UNDER TH15 DEED OF TRtJST OR ANY OF THE OTHER LOAN DOCUMENTS RELATING TO GRANTOR, THE MORTGAGED PROPERTY OR OTHERWISE IN CONNECTION WITH THE LOAN DOCUMENTS, INCLUDING, WITHOUT LIMITATION, THE PROTECTION OR ENFORCEMENT OF ANY LIEN, SECURITY INTEREST OR OTHER RIGHT, REMEDY OR RECOURSE CREATED OR AFFORDED BY THIS DEED OF TRUST ORTHE OTHER LOAN DOCUMEMTS; AND (c) ANYACTION BROUGHT BYBANKORTRUSTEE AGAINST GRANTOR UNDER THIS DEED OF TRUST OR THE OTHER LOAN DQCUMENTS, WHETHER OR NOT SUCH ACTION IS PR05ECUTED TO A FINAL, NON-APPEALABLE JUDGMENT. BANK ANDlOR TRUSTEE MAY EMPLOYAN ATTORNEY ORATTORNEYS TO PROTEST OR ENFORCE ITS RIGHTS, REM EDIES AND RECOURSES UNDER THIS DEED OF TRUSTAND THE OTHER LOAN DOCUMENTS, AND TO ADVISE AND DEFEND 6ANK AND/OR TRUSTEE WITH RESPECT TO ANY SUCH ACTION5 AND OTHER MATTERS. GRANTOR SHALL REIMBURSE BANK AND/OR TRUSTEE FORTHEfR RESPECTIVE ATTORNEYS' FEES AND EXPENSES (INCLUDING EXPENSES AND C05T5 FOR EXPERT5) IMMEDIATELY UPON RECEIPT OF A WRITTEN DEMAND THEREF�R, WHETHER ON A MONTHLY OR OTHER TIME INTERVAL, AND WHETHER OR NOT AN ACTION IS ACTUALLY COMMENCED OR CONCLUDED. ALL OTHER REIMBURSEMENT AND INDEMNITY OBLIGATIONS HEREUNDER SHALL BECOME DUE AND PAYABLE WHEN ACTUALLY INCURRED BY BANK AND/OR TRUSTEE. ANY PAYMENTS NOT MADE WITHIN FIVE (5) DAYS AFTER WRITTEN DEMAND THEREFOR SHALL BEAR INTEREST AT THE MAXIMUM RATE FROM THE DATE OF SUCH DEMAND UNTIL FULLY PAID. THE PROVISIONS OF THIS SECTION 8.4 SHALL SURVIVE REPAYMENT OF THE INDEBTEDNESS AND PERFORMANCE OF THE OBLIGATIONS, THE RELEASE OF THE LIEN OF THIS DEED OF TRUST, ANY FORECLOSURE (OR ACTION IN LIEU OF FORECLOSURE), THE TRANSFER BY GRANTOR OF ANY OR ALL OF ITS RIGHT, TITLE AND INTEREST IN OR TO THE PROPERTY AND THE EXERCISE BY BANK OF ANY AND ALL REMEDIES 5ET FORTH HEREIN OR IN THE LOAN DOCUMENTS. 8.5 Waiver by Bank. Bank may at any time and from time to time in writing (a) release any part of the Mortgaged Property, or any interest therein, from the lien and security interest of this Deed of Trust without the joinder of Trustee, or (b) release any party liable, either directly or indirectly, for the Indebtedness or for any covenant herein or in any of the other Loan Documents now or hereafter securing the payment of the Indebtedness, without impairing or releasing the liability of any other party. No such act shall in any way impair the rights of Bank hereunder except to the extent specifically agreed to by Bank in such writing. 8.6 Actions by Bank. The lien, security interest and other security rights of Bank hereunder shall not be impaired by any indulgence, moratorium or release granted by Bank, including but not limited to (a) any renewal, extension, increase or modification which Bank may grant with respect to any of the Indebtedness, (b) any surrender, compromise, release, renewal, extension, exchange or substitution which Bank may grant in respect of the Mortgaged Property, or any part thereof or any interest therein, or (c) any release or indulgen�e granted to any endorser, guarantor or surety of any of the Indebtedness. The taking of additional security by Bank shall not release or impair the lien, security interest or other se�urity rights of Bank hereunder or affect the Iiability of Grantor or of any endorser or guarantor or other surety or improve the rights of any permitted junior lienholder in the Mortgaged Property. In the event the ownership of the Mortgaged Property or any part thereof becomes vested in a person other than Grantor (without implying Bank's consent), Bank may, at Bank's option deal with such successor or successors in interest with reference to this Deed of Trust and to the Indebtedness in the same manner as with Grantor, without in any way discharging Grantor's liability upon the indebtedness or the Obligations. - 17 - sssisi.z (sio�ros) 8.7 Rights of Bank. Bank may waive any Event of Default without waiving any other prior or subsequent Event of Default. Bank may remedy any Event of Default without waiving the Event of Default remedied. Neither fhe failure by Bank to exercise, nor the delay by Bank in exercising, any right, power or remedy upon any Event of Default shail be construed as a waiver of such Event of Default or as a waiver of the right to exercise any such right, power or remedy at a later date. No modification or waiver of any provision hereof nor consent to any departure by Grantor therefrom shail in any event be effective unless the same sfiall be in writing and signed by Bank and then such waiver or consent shall be effective only in the specific instances, for the purpose for which given and to the extent therein specified. No notioe to nor demand on Grantor in any case shatl of itself entitle Grantor to any other or further notice or demand in similar or other circumstances. Acceptance by Bank of any payment in an amount less than the amount then due on any of thie Indebtedness shall be deemed an acceptance on account only and shall not in any way afiect the existence of an Event of Default hereunder. 8.8 Fixture Filing. This Deed of Trust shall be effective as a financing statement filed as a fixture filing with respect to all Fixtures included within the Mortgaged Property and is to be filed for record in the real property records in the Office of the County Clerk for the county or counties where the Mortgaged Property (including said Fixtures) is situated. 8.9 Subrogation. To the extent that proceeds of the Note are used to pay indebtedness secured by any outstanding lien, security interest, charge or prior encumbrance against the Mortgaged Property, such proceeds have been advanced by Bank at Grantors request and Bank shall be subrogated to any and all rights, security interests and liens owned or held by any owner or holder of such outstanding liens, security interests, charges or encumbrances, irrespective of whether said liens, security interests, charges or encumbrances are released; rop vided, however, that the tertns and provisions of this Deed of Trust shall govem the rights and remedies of Bank and shall supersede the tertns, provisions, rights and remedies under and pursuant to the instruments creating the liens, security interests, charges or encumbrances to which Bank is subrogated hereunder. 8.10 Application of Indebtedness. if any part of the Indebtedness cannot be lawFully secured by this Deed of Trust or if any part of the Mortgaged Property cannot be IawFully subject to the lien and security interest hereof to the fuil extent of the Indebtedness, then all payments made shall be applied on said Indebtedness first in discharge of that portion thereofwhich is unsecured by this Deed of Trust. 8.11 Contest of Certafn Claims. Nohnrithstanding any provision to the contrary contained in this Deed of Trust, Grantor shall not be in default forfailure to pay or discharge any Imposition or mechanic's or materialman's lien asserted against the Mortgaged Property if, and so long as, (a) Grantor shall have notified Bank of same within five (5) days of obtaining knowledge thereof; (b) Grantor shall diligently and in good faith contest the same by appropriate legal proceedings which shall operate to prevent the enforcement or collection of the same and the sale of the Mortgaged Property or any part thereof, to satisfy the same; (c) Grantor shall have furnished to Bank a cash deposit, or an indemnity bond satisfactory to Bank with a surety satisfactory to Bank, in the amount of the Imposition or mechanic's or materialman's lien claim, plus a reasonable additional sum to pay all costs, interest and penalties that may be imposed or incurred in connection therewith, to assure payment of the matters under contest and to prevent any sale or forfeiture of the Mortgaged Properly or any part thereof; (d) Grantor shall promptly upon final determination thereof pay the amount of any such Imposition or claim so determined, together with all costs, interest and penalties which may be payable in connection therewith; (e) the failure to pay the Imposition or mechanic's or materialman's lien claim does not constitute a default under any other deed of trust, mortgage or security interest covering or affecting any part of the Mortgaged Property; and (� notwithstanding the foregoing, Grantor shall immediately upon request of Bank pay (and if Grantor shall fail so to do, Bank may, but shall not be required to, pay or cause to be discharged or bonded against) any such Imposition or claim notwithstanding such contest, if in the reasonable opinion of Bank the Mortgaged Property shall be in jeopardy or in danger of being forFeited or foreclosed. Bank may pay over any such cash deposit or part thereof to the claimant entitled thereto at any time when, in the judgment of Bank, the entitlement of such claimant is established. 8.12 Maximum Interest. It is expressly stipulated and agreed to be the intent of Grantor and Bank at all times to comply strictly with the applicable Texas law goveming the maximum rate or amount of interest payable on the Note or the other Indebtedness (or applicable United States federal law to the extent that it pertnits Bank to contract for; charge, take, reserve or receive a greater amount of interest than under Texas law). If the appiicable law is ever judicially interpreted so as to render usurious any amount (a) contracted for, charged, taken, reserved or received pursuant to the Note, any of the other Loan Documents or any other communication or writing by or between Grantor and Bank related to the transaction or transactions that are the subject matter of the Loan Documents, (b) contracted for, charged or received by reason of Bank's exercise of the option to accelerate the maturity of the Note and/or the other Indebtedness, or (c) Grantor will have paid or Bank will have received by reason of any voluntary prepayment by Grantor of the Note and/or the other Indebtedness, then it is Grantor's and Bank's express intent that all amounts charged in excess of the Maximum Rate shall be automatically canceled, ab inifio, and all amounts in excess of the Maximum Rate theretofore collected by Bank shall be credited on the principal balance of the Note and/or the other Indebtedness (or, if the Note and all other Indebtedness have been or would thereby be paid in full, refunded to Grantor), and the provisions of the Note and the other Loan Documents immediately be deemed reformed and the amounts thereafter collectible hereunder and thereunder reduced, without the necessity of the execution of any new document, so as to comply with the applicable law, but so as to permit the recovery of the fullest amount otherwise called for hereunder and thereunder; provided, however, if the Note has been paid in full before the end of the stated term of the Note, then Grantor and Bank agree that Bank shall, with reasonable promptness after Bank discovers or is advised by Grantor that interest was received in an arpount in excess of the Maximum Rate, either refund such excess interest to Grantor and/or credit such excess interest against the Note and/or any other Indebtedness then owing by Grantor to Bank. Grantor hereby agrees that as a condition precedent to any claim seeking usury penalties against Bank, Grantor will provide written notice to Bank, advising Bank in reasonable detail of the nature and amount of the violation, and Bank shall have sixiy (60) days after receipt of such notice in which to correct such usury violation, if any, by either refunding such excess interest to Grantor or crediti�g such excess interest against the Note and/or the other Indebtedness then owing by Grantor to Bank. All sums contracted for, charged or received by Bank for the use, forbearance or detention of any debt evidenced by the Note and/or the other Indebtedness shall, to the extent permitted by applicable law, be amortized or spread, using the actuarial method, throughout the stated term of the Note and/orthe other Indebtedness (including any and all renewal and extension periods) until payment in full so that the rate or amount of interest on account of the Note and/or the - 18 - ss9isi.z (sio�ios� other Indebtedness does not exceed the Ma�mum Rate from 4ime to time in effect and appficable to the Note and/or the other Indebtedness for so long as debt is outstanding. In no event shall the provisions of Chapter 346 of the Texas Finance Code (which regulates certain revolving credit loan accounts and revofving triparty accounts) apply to the Note andlor the other Indebtedness. Nolwithstanding anyihing to the contrary contained herein or in any of the other Loan Documents, it is not the intenfion of Bank to accelerate the maturity of any interest that has not accrued at the time of such accelerafion or to collect uneamed interest at the time of such accelerafion. 8.13 Notices. Unless otherwise expressly provided herein, all noiices and other communicafions provided for hereunder shail be in writing (incfuding by facsimile transmission) and mailed, faxed, or delivered, to the address specified for notices on the signature page below or to such other address as shall be designated by such party in a notice to the ofher parties. Subject to Section 51.002 of the Texas Property Code, all such other notices and other communications shali be deemed to have been given or made upon the earfiest to occur of (a) actuai receipt by the intended recipient, or (b) (i) if defivered by hand or courier, when signed for by the designated recipient, (ii) if delivered by mail, four business days after deposit in the mail, postage prepaid, and (iii) if defivered by facsimile when sent and receipt has been confirmed by telephone. Electronic mail and internet websites may be used only to distribute routine communications, such as financial statements and other information, and to distribute Loan Documents for execution by the parties thereto, and may not be used for any other purpose. 8.14 Heirs, Successors and Assigns. The terms, provisions, covenants and conditions hereof shall be binding upon Grantor, and the heirs, devisees, representatives, successors and assigns of Grantor including all successors in interest of Grantor in and to all or any part of the Mortgaged Property, and shall inure to the benefit of Trustee and Bank and their respective heirs, successors, substitutes and assigns and shall constitute covenants running with the Land. All references in this Deed of Trust to Grantor, Trustee or Bank shall be deemed to include all such heirs, devisees, representatives, successors, substitutes and assigns. All Obligations contained in this Deed of Trust and the other Loan Documents are intended by Grantor, Bank, and Trustee to be, and shall be construed as, covenants running with the Mortgaged Property until the lien of this Deed of Trust has been fully released by Bank. 8.15 Severebility. A determination that any provision of this Deed of Trust is unenforceable or invalid shall not affect the enforceability or validity of any other provision and any determination that the application of any provision of this Deed of Trust to any person or circumstance is illegal or unenforceable shall not affe�t the enforceability or validity of such provision as it may apply to any other persons or circumstances. 8.16 Gender and Number. Within this Deed of Trust, words of any gender shall be held and construed to include any other gender, and words in the singular number shall be held and construed to include the plural and words in the plural number shall be held and construed to include the singular, unless in each instance the context otherwise requires. 8.17 Joint and Several. Where two or more persons or entities have executed this Deed of Trust, unless the context cleariy indicates otherwise, the term "Grantor" as used in this Deed of Trust means the grantors hereunder or either or any of them and the obligations of Grantor hereunder shall be joint and several. 8.18 Consent of Bank. Exceptwhere otherwise provided herein, in any instance hereunderwhere the approval, consent or the exercise of judgment of Bank is required, the granting or denial of such approval or consent and the exercise of such judgment shall be within the sole discretion of Bank, and Bank shall not, for any reason or to any extent, 6e required to grant such approval or consent or exercise suchjudgment in any particular manner, regardless of the reasonableness of eitherthe request or Bank's judgment. 8.19 Consent to Disposition. It is expressly agreed that Bank may predicate Bank's decision to grant or withhold consent to a Disposition on such terms and cvnditions as Bank may require, in Bank's sole discretion, including without limitation (a) consideration of the creditworthiness of the party to whom such Disposition will be made and its management ability with respect to the Mortgaged Property, (b) consideration of whether the security for repayment of the Indebtedness and the performance and discharge of Grantor's obligafions under this Deed of Trust, or Bank's ability to enforce its rights, remedies, and recourses with respect to such security, will be impaired in any way by the proposed Disposiiion, (c) an increase in the rate of interest payable under the Note or any other change in the terms and provisions of the Note and other Loan Documents, {d) reimbursement of Bank for all costs and expenses incurred by Bank in investigating the creditworthiness and management of the party to whom such Disposition will be made and in detertnining whether Bank's security will be impaired by the proposed Disposition, (e) payment of Bank's reasonable attorneys' fees in connection with such Disposition, (� the execution of assumption agreements, modification agreements, supplemental loan documents, and financing statements, satisfactory in form and substance to Bank, (g) endorsements (to the extent available under applicable law) to any existing mortgagee title insurance policies insuring Bank's liens and security interests covering the Mortgaged Property, and (h) requiring additional security for the payment of the Indebtedness and performance and discharge of Grantor's obligations under this Deed of Trust. Nothing contained in this Section 8.19 is intended to alter Bank's authority to withhold its consent to a Disposition in its sole, arbitrary discretion. 8.20 Entire Agreement. The Loan Documents constitute the entire understanding and agreement between Grantor and Bank with respect to the transactions arising in connection with the Indebtedness and supersede all prior written or vral understandings and agreements between Grantor and Bank with respect thereto. Grantor hereby acknowledges that, except as incorporated in writing in the Loan Documents, there are not, and were not, and no Persons are or were authorized by Bank to make, any representations, understandings, stipulations, agreements or promises, oral or written, with respect to the transa�tion which is the subject of the Loan Documents. The Loan Documents may only be modified or terminated by a written instrument or instruments executed by the party against which enforcement of the modification ortermination is asserted. Any alieged modification ortermination which is not so documented shall not be effective as to any party. - 1g - sssie�s �aro�ios� 6.21 Change in Organization. Grantor will not cause or permit any (a) change of Grantor's chief executive oifice to a jurisdiction other than as represented below in this Deed of Trust, or (b) change the state of Grantor's organization as it exists on the date of this Deed of Trust, or (c) change Grantors name as it exists on the date of this Deed of Trust, unless Grantor shall have notified Bank in writing of such change at least thirty (30) days prior to the effective date of such change, and shall have first taken all action required by Bank for the purpose of further pertecting or protecting the security interest in favor of Bank in the Mortgaged Property. In any written notice fumished pursuant to this Section, Grantor wili e�ressly state that the notice is required by this Deed of Trust and contains iacts that may require additional filings of financing statements or other notices for the purpose of continuing pertection of Bank's security interest in the Mortgaged Properly. 6.22 Rules of Construction. The section headings or captions in this Deed of Trust are for convenience and are not a part of this instrument for any purpose. Any action pertnitted to Bank may be taken by any authorized officer, employee or agent of Bank, or any attomey, accountant, environmental consultant or other advisor or professional retained by Bank. Use of the term "inciuding" does not imply any limitation on (but may expand) the antecedent reference. Unless the context clearly requires otherwise, the term "may" does not imply any obiigation to act. Any reference to exhibits or schedules means the exhibits or schedules to this Deed of Trust, which are fully incorporated by reference into this Deed of Trust. Any reference to a particular document includes all modifications, supplements, replacements, renewals or extensions of that document, but this rule of construction does not authorize amendment of any document without Bank's consent. 8.23 Release of Lien. If the Indebtedness is fully paid and Bank has no further obiigation to lend to Borrower, and the Obiigations are fully discharged, Bank, 'upon Grantor's written request and at Grantor's expense, will execute a release of the lien created by this Deed of Trust. The release must be in form anYi content satisfactory to Bank. 8.24 Governing Law; Place of Pertormance. The Loan Documents a�e being executed and delivered, and are intended to be pertormed, in the 5tate of Texas, and the laws of such state and of the United States shall govem the rights and duties of the parties hereto and the validity, construction, enforcement, and interpretation of the Loan Documents, excepi to the extent othervvise specified in any of the Loan Documents. This Deed of Trust, all of the other Loan Doouments, and all of the obfigations of Grantor under any of the Loan Documents are performable in Tarrant County, Texas. Venue of any litigation involving this Deed of Trust or any Loan Document shall be maintained in an appropriate state or federal court located in Tarrant County, Texas, to the exclusion of all other venues. 8.25 WAIVER OF RIGHT TO TRIAL BY JURY. GR,4NTOR 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 BANK IN THE ENFORCEMENT OF ANY OF THE TERMS OR PROVISIONS OF THIS DEED OF TRUST OR THE OTHER LOAN DOCUMENTS. 8.26 SBA. The loan evidenced by the Note (the "Loan") secured by the Mortgaged Property was made under a United States Small Business Administration ("SBA") nationwide program which uses tax dollars to assist small business owners. Ifthe United 5tates is seeking to enforce this Agreement, then under SBA regulations: (a) When 56A is the holder of the Note, this Deed of Trust and all Loan Documents will be construed in accordance with federal law. (b) Beneficiary or SBA may use locai or state procedures for purposes such as filing papers, recording documents, giving notice, foreclosing liens, and other purposes. By using these procedures, SBA does not waive any federal immunity from local or state control, penalty, tax or liability. No Borrower or Guarantor may claim or assert against SBA any local or state law to deny any obligafion of Borrower, or defeat any claim of 5BA with respect to the Loan. Any clause in this Deed of Trust requiring arbitration is not enforceable when SBA is the holder of the Note. EXECUTED to be effective as of August _, 2006. GRANTOR/BORROW ER: CLIFFORD A. MILLI Address: 110 Hillside Drive W. Burleson, Texas 76028 MAX HELEN MILLICAN Address: 110 Hillside Drive W. Burleson, Texas 76028 - 2� - 559'16�.2 (8/07/O6) Mailing Address For Bank: 50UTHWEST BANK 3737 S.W. Loop 820 Fort Worth, Texas 76133 STATE OF TEXAS COUNTY OF This instrument was acknowledged before me on STATE OF TEXAS COUNTY OF This instrument was acknowledged before me on STATE OF TEXAS COUNTY OF CAM CERTIFIED AIRCRAFT MAINTENANCE, INC. By: _ tJame: Title: Address: 12657 Wildcat Way North Fort Worth. Texas 76028 day of , 2006, by Clifford A. Millican. Notary Public, 5tate of Texas day of , 2006, by Max Helen Millican. Notary Public, State of Texas This instrument was acknowledged before me on day of , 2006, by , of CAM Certified Aircraff Maintenance, Inc., a corporation, on behalf of said corporation. Notary Public, State of Texas - 2� - 559'16�.2 (BID7I06) EXHIBIT "A" LAND DESCRIPTION EXH�BIT "A" LAND �ESCRiPTIaN: SEING A PORTION oF a�ocK 5, FOR7 WoRTH sPINK's AIRPORT, AN AppiTloN TO THE clrY OF F4RT WORTH, TARRANT COUMTY, TEXAS, AS RECQRDED IN CABiNET A, S�IDE 353, PLAT RECORpS, TARRANT COUNTY, T�XAS, SAID PORTlON BEING MORE PARTiCULARLY DESCRIBED BY METES A�Jp BOUNDS AS FbLLOWS: BEGINNING AT A PK NAIL S�T WITH A WASHER 5TAMPED, "RPLS 5544" F�R TH� NORTHWEST CORNER OF SUBJECT TRACT FROM WHICH SPINK'S CONTROL MQNUMENT N0. 3 B�ARS Narth 89'14�57" West 2615.55 F�E7 AND North OQ'OD'15" Easf 91.03 F��T; THENCE South 89'74'37" Eost A D15TANC� OF 160.D0 FE�T TO A 1/2 INCH IRON ROD SET WITW A PLA571C CAP STAM3'ED, "RPLS 5544"; THENCE South 00'45'03" Wssf A DISTANC� OF 140.�0 FEET TO A 1/Z INCH IRON ROD SET WITH A PLASTIC CAP STAMP�D, "RPLS 55-0�4"; THENCE North 89'i4�57" West A DISTANCE OF 16D.OD FEET TO A PK NAIL 5ET WITH A WASNER STAMPED, "RP�.S 5544"; THENCE North UD'45'03" �ast A DISTANCE OF 74�_QO FEET TO TH� POINT QF BEGINNING HAVING AN AREA OF 0.514 ACRES OF LAND, MORE OR LESS. . SPINKS CON7ROL MONUA9h�T N0. 3 (X�2.058.086.9fij (Y�328,350.9D) S00'45'D3"W 1/2" IRON ROD SET ' ' W/Cqp STAMPED "RPLS 5544" � Q O � �-- I�� NAI6 5�T STAMPEo 91.0$� 1 A�0.�0' O O O cp e— PORTION OF pLOCK 5 FORT WORTH � � sPINKS AIRPORT AOAITIoN � CqSINE7 A. SLIDE 353 ^ � 0.514 ACRES � d' �„ � � � � NQO'45'p3"E 140.00' 3 u�i v�,, . rF u� O7 N m z 2108.99' N00•00'16"E 2,240.02' (2,199.�9') BASjS OF BFARING C�NTRDUNG LJNE 1/2" IRON Rap s�r W/CAP STAMPEp RPIS 5544" W/WAS,4ERESTAMPED "RPLS 5544" �� ----� 5 0' 60' 120' SCALE: 1" = 60' �.aoa PuiN No�: ' ACCORDING TO TH@ FLOOD INS�ftANCQ RnTE MAP No. 46439C0535 H REVISED PREPAREp UNQER MY DIR�CTION. OS-02-1995, T}j�S LOT APP�ARS TD BE �N "ZONE X" AR�AS DETERMIN6p TD BE DUTS�DE soo YEaR fL000—P�4iN. �F. j' ��v� S 7E,��'� •y:�......�•...�..�:n. �� " \ ��I� � 1 A/ , M�rr pow�s; � Mnrr aow�►..�. �� Y ll RECIstERFA fR9F:5510%u, Llryo SURyEYOR ti�0 55r}4 �P :0�. T6t1t5 RECIsTFFnGM ND. d544 °�' d''G�ad�sy ��,;��55,�.�{ oAT�Q. t�-��-�� 17C0 50. oo95aN sTRF�f S v f�� — BtIp1.�5CN� T7c 7eoae . ' 817—}j7-47u EXHIBIT "A» SHT. N0. �AT: 10—O6—Ofi pRAWN: M,P. CHECKED: M•P, PLS JOB N0. 2005001—�4 'I OF 1 City of Fort Worth, %xas Mayor and Council Communication > >. �, M . �a . ,. _.�� _ . � a .� � �._ � . , � �. � _ p... �M . _ x. uw�.s. .T = .:.: .. ..�. _.�..� ��_a 1.� _��r .. COUNCIL ACTION: Approved on 10/3/2006 , .��.. .. ,. a , , . .. . . . .. , , ... _ . _�.. w � ��, . ...... � A,..,. . �.�. ... �.�.., .. u .., � n �:,.�. .. . .,, .� ��. � .... . ,�... .,,. DATE: Tuesday, October 03, 2006 LOG NAME: 55MILLICAN DOT REFERENCE NO.: **C-21750 SUBJECT: Authorization to Execute a Written Consent to Deed of Trust Lien by Cliff Millican in Favor of Southwest Bank for Lease Site E-12 at Fort Worth Spinks Airport �a ... z�„ � • :- :z. , � �: � .< ,.�.. . .__._.. . �.... _ _ .... ._. ...,F... ,_�.. _ .. �.,. .. ,. ..._ .� ., . .. . - RECOMMENDATION: It is recommended that the City Council authorize the City Manager to execute a written consent to Deed of Trust Lien by Cliff Millican in favor of Southwest Bank for Lease Site E-12 at Fort Worth Spinks Airport. DISCUSSION: On :;;:�y 1�, 2006, (M&C C-21574) City Counci� approved execution of an unimproved ground lease with mandatory improvements with Cliff Millican for the construction of a commercial aircraft maintenance hangar at Fort Worth Spinks Airport. Cliff Millican currently leases Lease Site E-12 at Fort Worth Spinks Airport pursuant to City Secretary Contract (CSC) No. 33940. Cliff Millican wishes to obtain financing for the 16,800 square foot commercial aircraft maintenance hangar from Southwest Bank. Accordingly, Mr. Millican has requested the City's consent to his execution of a Deed of Trust Lien on the premises in order for the Bank to secure his loan. The Deed of Trust Lien will grant the Bank the right to operate as Lessee or to secure another tenant in place of Cliff Millican, if approved by the City Council, in the event that Cliif Millican defaults on the loan or his lease with the City of Fort Worth. The Lease Agreement prohibits Cliff Millican from making any assignment of the Lease or causing any lien to be made on improvements constructed on the Leased Premises without City Council approval. This type of transaction is routine for large airport tenants and City staff has no objection to Mr. Millican's request. Fort Worth Spinks Airport is located in COUNCIL DISTRICT 8. FISCAL INFORMATION/CERTIFICATION: The Finance Director certifies that this action will have no material effect on City funds. TO Fund/Account/Centers FROM Fund/Account/Centers . y , _ .. .� �.. .... .._ ._.�,�. �-,...�.m..� � _. ,t � . �. .._.�. __.,_� :r . _ ....._ ..•: . ,.,�. ,. .,.. .. �., .. . .. _. . . �. Submitted for City Manager's Office bv: Originatin�De�artment Head: Additional Information Contact: Marc Ott (8476) Mike Feeley (871-5403) Mike Feetey (871-5403) Logname: SSMILLICAN DOT Page 1 of 1