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HomeMy WebLinkAboutContract 37540N� 6Cr NO . CONSENT TO DEED OF TRUST LIEN UPON LEASEHOLD FORT WORTH SPINKS AIRPORT UNIMPROVED GROUND LEASE AGREEMENT WITH MANDATORY IMPROVEMENTS FWS REALTY, LTD. (LEASE SITE FBO TERMINAL BUILDING AND HANGAR) (CITY SECRETARY CONTRACT N0.30655) 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; FWS Realty, Ltd. ("Lessee"), a Texas limited partnership, acting by and through its General Partner, Harrison Realty Investments, LLC, and Regions Bank ("Bank"). RECITALS A. On or about October 6, 2004, Lessor and Lessee entered into City Secretary Contract (CSC) No. 30655, as amended by CSC No. 32469 (the "Lease"), a lease of unimproved land at Fort Worth Spinks Airport ("Airport") known as the FBO Terminal Building and Hangar (the "Leased Premises"). B. On or about August 25, 2006, Lessor and Lessee entered into CSC No. 33916, a consent to deed of trust lien upon leasehold for Lease Site W-2 at Fort Worth Spinks Airport. This included Hangar W-2 but did not include the parcel with the FBO Terminal Building that is also included in the unimproved ground lease. C. In order for Lessee to obtain certain financing related to Lessee's construction of 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 entire Leased Premises, including the FBO Terminal Building and the Hangar (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 that Lessee and the Bank do not have any right to convey any interests in the Leased Premises greater {A17\5852\0019\W0365244.1 } OFFICIAL RECORD CITY SECRETARY FT. WORTH, TX 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 shall 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 terminate 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 thirty (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 may request Lessor to provide a reasonable amount of additional time to cure such default, in which case Lessor will provide Lender with an extended deadline to cure such default as determined by Lessor in its sole but reasonable discretion. 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. So long as Lessee (or in the event of a foreclosure under the Deed of Trust, Lender or a lawful third party assignee of Lender) is not in default under the Lease at the time, Lender may, at no expense to Lessor and in accordance with the Deed of Trust enter onto the Leased Premises at any time or times and take possession of, sever or remove personal property of Lessee that is not permanently affixed to the Leased Premises (other than trade fixtures), including, but not limited to, machinery, equipment, furniture, fixtures, inventory and all additions, replacements or substitutions therefore (collectively "the Property"), which property may be sold, transferred or otherwise disposed of by Lender. 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 all public risks related to the leasing, use, occupancy, maintenance, existence or location of the Leased Premises. Notwithstanding anything to the contrary in the Deed of Trust, the Bank hereby agrees and covenants that any and all proceeds payable under the terms of such insurance policies shall first be applied to cover the replacement of all facilities and improvements on the Leased Premises and to satisfy fully the terms and conditions of the Lease. Payment of such proceeds shall apply secondarily to secure any of Lessee's indebtedness to the Bank. {A17\5852\0019\W0365244.1 } Page 2 of 20 Pages 8. Subject to Sections 4 and 6 of this Agreement, Lessor may take ail 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 will promptly notify Lessor m 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 terminated. 10. The Bank may not sell or otherwise transfer in any way any of the Bank's or Lessee's rights or interest in the Leased Premises unless Lessor consents to such sale or transfer in the form of a written agreement approved in advance by Lessor's City Council. 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: Regions Bank P.O. Box 7232 Monroe, LA 71211-7232 Attn: Butch Troquille 12. The parties hereto understand and agree that upon expiration or termination of the Lease, all structures, improvements and fixtures on the Leased Premises, and any items permanently attached to any such structure, fixture or improvement, will become the sole property of Lessor, free and clear of all 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 assign any rights and/or obligations thereunder, without the prior written consent of Lessor. Lessee and Bank shall have the right to modify and extend the terms of the note secured by the Deed of Trust and to file such modifications in the Deed Records of Tarrant County, Texas. 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 shall 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 instrument, 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. {A17\5852\0019\W0365244.1 } Page 3 of 20 Pages IN WJTNESS WHEREOF, the parties hereto have executed this Agreement in multiples on this the I day of , 2008.; CITY OF FORT WORTH: By: T.M. Higgins Assistant City Manager Date: 918/08 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 T.M. Higgins, 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 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. GIVEN UNDER MY HAND AND SEAL OF OFFICE this day le �2 c P/iJ 20080 ROSELLA BARNES * MY COMMISSION EXPIRES . March 31, 2009 Notary Public in and for the State of Texas APPROVED AS TO FORM AND LEGALITY: By: Charlene Sanders Assistant City Attorney Contract Authorization: M&C: Z'J U t Date Approved: {A17\5852\0019\W0365244.1 } ATTEST: By: City Secretary ��FICIAL RECORD CITY SECRETARY FTo WpafT010T0 FWS REALTY, LTD: By: ame: John Cockerham Title: Authorized Manager STATE OF TEXAS § COUNTY OF TAINT § ATTEST: By: •�.vL/ BEFORE ME, the undersigned authority, a Notary Public in and for the State of Texas, on this day personally appeared John Cockerham, 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 FWS Realty, Ltd. and that s/he executed the same as the act of FWS Realty, Ltd. for the purposes and consideration therein expressed and in the capacity therein stated. By: GIVEN UNDER MY HAND AND SEAL OF OFFICE this _ day "Llus, 2008. >t�"�P��, RITA A. SINGLETON NOTARY PUBLIC V�My STATE OF TEXAS Comm. Exp.12-i5-2008 Title: �/ I 5> % a-i I Date: Qt arq-�)a STATE OF G�-►'t a� § PQ riI ,k Cr'T�TR OF d § ATTEST: By: G(.•ya� �'trw BEFORE ME, the undersigned authority, a Notary Public in and for the State of (.,G1,uSlan� on this day personally appeared �U%Li�TrtYfLU I i� 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 Regions Bank and that s/he executed the same as the act of Regions Bank for the purposes and consideration therein expressed and in the capacity therein stated. GIVEN UNDER MY HAND AND SEAL OF OFFICE this to 'day Out Gu4-t , 2008* aU_ w Notary Public ip_ and for the State of CAV'bN WILLIAMS, NOTARY PUBLIC CAC DO PARISH, LOUISIANA {A17\5852\0019\W0365244.1 } f FAY COMMISSION IS FOR LIFE NOTARY ID # 067569 Page 5 of 20 Pages a EXHIBIT A (Form of Deed of Trust) NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY OR ALL OF THE FOLLOWING INFORMATION FROM ANY INSTRUMENT THAT TRANSFERS AN INTEREST IN REAL PROPERTY BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER. DEED OF TRUST, SECURITY AGREEMENT AND ASSIGNMENT OF RENTS (Leasehold Estate) THE STATE OF TEXAS § COUNTY OF TARRANT § KNOW ALL MEN BY THESE PRESENTS: THAT FWS Realty, Ltd., a Texas limited partnership, (hereinafter referred to as "Grantor"), whose mailing address is 3825 Camp Bowie Blvd, Fort Worth, Texas 76107, in consideration of the sum of Ten ($10.00) Dollars to Grantor in hand paid, the receipt and sufficiency of which is hereby acknowledged, and in Further consideration of the uses, purposes and trusts herein set forth and declared, have Granted, Bargained and Sold, and by these presents do Grant, Bargain, Sell, Alienate, Convey and Confirm unto James L. Hedrick, Trustee, hereinafter referred to as "Trustee", all of the property described in paragraphs A, B and C, immediately following, to -wit: A. All of the leasehold estate under, and all of the rights of Grantor under or with respect to, that certain Unimproved Ground Lease Agreement with Mandatory Improvements (City Secretary Contract No. 30655), dated October 6, 2004, by and between the City of Fort Worth, as Lessor, and FWS Realty, Ltd., as Lessee, as amended by Amendment No. 1 (City Secretary Contract No. 32469) dated October 12, 2005, by and between the City of Fort Worth and FWS Realty, Ltd., as referenced in (i) Memorandum of Lease (City Secretary Contact No. 33916) dated August 29, 2006, filed for record in 2006 in the Office of the County Clerk of Tarrant County, Texas under Clerk's File No. D206276858, Official Public Records of Tarrant County, Texas, and (ii) Memorandum of Lease (City Secretary Contact No. ) dated , 2008, filed for record in 2008 in the Office of the County Clerk of Tarrant County, Texas under Clerk's File No. , Official Public Records of Tarrant County, Texas with respect to the land described therein including, without limitation, all of the land described in Exhibit "A" attached hereto (the "Land"), together with all buildings and improvements now or hereafter situated thereon (the "Lease"). Prior to release of this Deed of Trust (as used herein, the expression "this Deed of Trust" shall mean this Deed of Trust, Security Agreement and Assignment of Rental), fee title to the Land and the leasehold estate under the Lease will not merge but will always remain separate, notwithstanding a union of the estates. Be All fixtures, equipment, inventory and tangible personal property in which Grantor now has, or at any time hereafter acquires, an interest, and which are now, or at anytime hereafter, situated in, on or about the Land, and all renewals, replacements and substitutions thereof and additions thereto (all {A17\5852\0019\W0365244.1 } Page 6 of 20 Pages property described or referred to in this paragraph B being hereinafter sometimes called "Accessories"). Grantor agrees that the Accessories are and will be a part of and affixed to the Land. C. All other interest of every kind and character which Grantor now has or at any time hereafter acquires in and to the property described or referred to in Paragraphs A and B preceding and all other property (tangible or intangible) which is used or useful in connection with the Land and Accessories. All property and interest described or referred to in paragraphs A, B, and C preceding is sometimes hereinafter referred to collectively as the "Mortgaged Property." TO HAVE AND TO HOLD the Mortgaged Property, together with all and singular the rights, hereditaments and appurtenances in anywise appertaining or belonging thereto, unto Trustee, and his successors or substitutes in this trust, and his and their assigns, in trust and for the uses and purposes hereinafter set further, forever. Grantor, for Grantor and Grantor's successors, hereby agrees to warrant and forever defend, all and singular, the Mortgaged Property unto Trustee, and his successors or substitutes in this trust, and to his and their assigns, forever, against every person whomsoever lawfully claiming or to claim the same or any part thereof. As used herein, the term "Grantor's successors" means each and all of the successors, assigns, executors, heirs, administrators and legal representatives of Grantor, both immediate and remote. Grantor hereby grants to the Mortgagee hereinafter named, and to the successors and assigns of Mortgagee, a security interest in the Mortgaged Property, and each and every part thereof, and in all proceeds from the sale, lease or other disposition thereof and in all sums, proceeds, funds and reserves described or referred to in Sections 5.7, 5.8 and 5.9 hereof; provided, that the grant of a security interest in proceeds shall not be deemed to authorize any action otherwise prohibited herein. Mortgagee's mailing address is 1500 N 18t" Street, Monroe, Louisiana 71201. ARTICLE I The Obligation Section 1.1 This Deed of Trust and all rights, titles, interests, liens, security interests, powers and privileges created hereby or arising by virtue hereof, are given to secure payment and performance of the following indebtedness, obligations and liabilities: (a) the indebtedness evidenced by a Promissory Note executed by Grantor payable to the order of Regions Bank (hereinbefore and hereinafter referred to as "Mortgagee"), at Monroe, Louisiana, dated of even date herewith, in the principal face amount of $1,606,154.50, maturing on February 1, 2014, bearing interest as therein specified, containing an attorney's fee clause, interest, and principal being payable as therein specified, and being upon the other terms and conditions therein stipulated, to which Note reference is here made for all pertinent purposes; (b) all indebtednesses, obligations and liabilities arising pursuant to the provisions of this Deed of Trust; (c) all other indebtednesses, obligations and liabilities of Grantor to Mortgagee, whether now existing or hereafter arising, including, without limitation, all obligations of Grantor to Mortgagee or its affiliates under any swap agreement (as defined in 11 U.S.C. Section 101) as in effect from time to time; and (d) any and all renewals or extensions of all or any part of the indebtednesses, obligations and liabilities described or referred to in Subsections 1.1(a), 1.1(b), and 1.1(c) preceding. The word "Obligation", as used herein, shall mean all of the indebtednesses, obligations and {Al7\5852\0019\W0365244.1 } Page 7 of 20 Pages liabilities described or referred to in Subsections 1.1(a), 1.1(b), 1.1(c), and 1.1(d) preceding. The word "Holder", as used herein, shall mean the holder or holders of the Obligation at the time in question. The Promissory Note hereinabove described (and any renewals, extensions, modifications or restatements thereof) is hereinafter referred to as the "Note". ARTICLE II Certain Representations, Warranties and Covenants of Grantor Section 2.1 Grantor represents and warrants that: (a) Grantor has authority to execute and deliver this Deed of Trust; (b) the Accessories are and will be used as equipment in Grantor's business; (c) the statements contained in this Deed of Trust concerning Grantor's mailing address are true and correct; (d) Grantor is lawfully seized of the Mortgaged Property as the tenant under the Lease, (e) the Lease is currently in force and affect; is enforceable; and has not been modified or amended, except for any written amendments referenced in this Deed of Trust and except for that certain waiver by letter of an option to build, (f) Grantor has not waived or released any of its rights under the terms of the Lease, and (g) Grantor is not in default under the terms of the Lease, nor is Grantor aware of any fact, circumstance or occurrence which, with the giving of notice and/or the passage to time, would constitute a default by Grantor under the Lease. Section 2.2 Grantor, for Grantor and Grantor's successors, covenants and agrees to: (a) pay or cause to be paid, before delinquent, all lawful taxes and assessments of every character in respect of the Mortgaged Property, or any part thereof and from time to time, upon request of Holder, to furnish to Holder evidence satisfactory to Holder of the timely payment of such taxes and assessments; (b) carry insurance with respect to the Mortgaged Property with such insurers, in such amounts and covering such risks as shall be reasonably satisfactory to Holder, including, but not limited to, insurance against loss or damage by fire, lightning, hail, windstorm, explosion, hazards, casualties and other contingencies; provided that in the absence of written direction from Holder, the insurance shall not be less than the full insurable value of the Mortgaged Property or the amount of the Obligation, whichever is less; (c) cause all insurance so carried to be payable to Holder as its interest may appear, to stipulate that same can be cancelled only upon fifteen (15) days written notice to Holder, to deliver the policies of insurance to Holder, and, in the case of all policies of insurance carried by each Lessee (as that term is hereinafter defined) for the benefit of Grantor, to cause all such policies to be payable to Holder as its interest may appear; (d) pay, or cause to be paid, all premiums for such insurance at least fifteen (15) days before such premiums become due or within the time period required by the insurer, furnish to Holder satisfactory proof of the timely making of such payments, and to deliver all renewal policies, certificates of insurance or other satisfactory proof of renewal to Holder within thirty (30) days after the expiration date of each expiring policy; (e) comply with all valid governmental laws, ordinances and regulations applicable to the Mortgaged Property and its ownership, use and operation, including without limitation, all laws now or hereafter in effect pertaining to health, hygiene, the environment or environmental conditions on, under, or about the Land, including without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 USC §9601, et seq, the Resource Conservation and Recovery Act, 42 USC §6901, et seq, the Clean Water Act, 33 USC § 1251, et seq, the Clean Air Act, 42 USC §7401, et seq, the Federal Water Pollution Control Act, 33 USC § 1251, et seq, and any similar state laws or ordinances, including without limitation, the Texas Water Code §26.001, et seq, the Texas Solid Waste Disposal Act, Texas Health and Safety Code §361.001, et seq, and Regulations, Rules, Guidelines and Standards promulgated pursuant to such laws, statutes and regulations, as amended from time to time, and to comply with all, and not violate any easements, restrictions, agreements, covenants, and conditions with respect to or affecting the Mortgaged Property, or any {A17\5852\0019\W0365244.1 } Page 8 of 20 Pages part thereof; (f) at all times maintain, preserve and keep the Mortgaged Property in excellent repair and condition, and from time to time make all necessary and property repairs, replacements and renewals, and not to commit or permit any waste on or of the Mortgaged Property, and not to do anything to the Mortgaged Property that may impair its values (g) promptly pay all bills for labor and materials incurred in connection with the Mortgaged Property and never to consent to be fixed against the Mortgaged Property, or any part thereof, any lien or security interest, even though inferior to the liens and security interests hereof, for any such bill which may be legally due and payable, and never to consent to be created or exist in respect of the Mortgaged Property, or any part thereof, any other or additional lien or security interest on a parity with or superior to the liens and security interests hereof, provided however, if any interest of the Mortgaged Property shall become subject to any attachment, judgment, lien, charge or other encumbrance whatsoever, Grantor shall immediately cause any such attachment, judgment, lien, charge or other encumbrance to be discharged or otherwise bonded or transferred to other security. ; (h) at any time and from time to time, upon request by Holder, forthwith, execute and deliver to Holder any and all additional instrument and further assurances, and do all other acts and things as may be necessary or proper, in Holder's opinion, to effect the intent of these presents, more fully evidence and perfect the rights, titles, liens and security interests herein created or intended to be created and protect the rights, remedies, powers and privileges of Holder hereunder; (i) from time to time, upon request of Holder, promptly furnish to Holder such financial statements and reports relating to Grantor and Grantor's business affairs as Holder may reasonably request; 0) continuously maintain Grantor's existence and its right to do business in Texas; (k) not, without the prior written consent of Holder (which consent may be withheld with or without cause), sell, trade, transfer, assign, exchange or otherwise dispose of the Mortgaged Property, or any part thereof, except for sales of inventory in the ordinary course of business and disposition of items of the Accessories which have become obsolete or worn beyond practical use and which have been replaced by adequate substitutes having a value equal to or greater than the replaced items when new; (1) pay and perform all of the Obligation in accordance with the terms thereof or hereof, or when the maturity thereof may be accelerated in accordance with the terms thereof or hereof; (m) promptly deliver to Holder the terms of any sale of the Mortgaged Property, or any part thereof, and pay to Holder a reasonable fee each time title to the Land or any part thereof is transferred, to reimburse Holder and anyone acting on behalf of Holder for time spent and expenses incurred as a result of each such transfer; provided, however, that neither this Subsection (m) nor Sections 5.5, 5.9, 5.11 and 5.13 hereof shall be construed to impliedly or expressly authorize any action by Grantor contrary to Subsection 2.2(k) preceding, nor shall this subsection (m) be construed as allowing a prepayment penalty if the Note is paid in full prior to its maturity date; (n) (Intentionally Omitted); (o) at any time any law shall be enacted imposing or authorizing the imposition of any tax upon this Deed of Trust, or upon any rights, titles, liens or security interests created hereby, or upon the Obligation, or any part thereof, immediately pay all such taxes; provided that, in the alternative, Grantor may, in the event of the enactment of such a law, and must, if it is unlawful for Grantor to pay such taxes, prepay the Obligation in full within sixty (60) days after demand therefor by Holder; (p) at any time and from time to time, furnish promptly, upon request, a written statement or affidavit, in such form as shall be satisfactory to Holder, stating the unpaid balance of the Obligation and that there are not offsets or defenses against full payment of the Obligation and the terms hereof, or, if there are any such offsets and defenses, specifying them; (q) (Intentionally Omitted); (r) punctually and properly perform all of Grantor's covenants, duties and liabilities under any other security agreement, mortgage, deed of trust, collateral, pledge agreement, contract or assignment of any kind now or hereafter existing as security for or in connection with payment of the Obligation, or any part thereof (each such being herein called "other security instrument"); (s) allow Holder to inspect the Mortgaged Property and all records relating thereto or to the Obligation, and to make and take away copies of such records; and (t) not cause or permit the Accessories, or any part thereof, to be removed from the County and State where the Land is located, except items of the Accessories which have become obsolete or worn beyond practical use and which {A17\5852\0019\W0365244.1 } Page 9 of 20 Pages have been replaced by adequate substitutes having a value equal to or greater than the replaced items when new. Section 2.3 Grantor shall (i) perform all of its obligations under the Lease and deliver to Holder, upon request, satisfactory evidence of®timely payment of all rents and other charges due under the Lease; (ii) enforce the landlord's obligations under: the Lease; (iii) promptly deliver to Holder a copy of any notice of default or demand received from landlord with respect to the Lease; (iv) execute and deliver to Holder, upon request, any instruments required in order to permit Holder to cure any default by Grantor under the Lease or to preserve the interest of Holder in the leasehold estate under the Lease; (v) not do or permit anything to be done that would impair the security of this Deed of Trust or constitute grounds for termination of the Lease by landlord; and (vi) not consent, without Holder's prior written approval, to any waiver, cancellation or amendment of any provision of the Lease or any subordination of the Lease to any mortgage of the landlord's fee interest in the Land. ARTICLE III Respecting Defaults and Remedies of Holder Section 3.1 The term "Default", as used herein, shall mean the occurrence of any one or more of the following: (a) failure to pay the indebtedness evidenced by any Note, or any part thereof, as it becomes due in accordance with the terms of the Note or other instruments which evidence it, or when accelerated pursuant to any power to accelerate, and failure of Grantor to cure such default within any applicable grace or cure period therein provided; or (b) failure of Grantor to punctually and properly perform any other covenant, agreement or condition contained herein within thirty (30) days after receipt of written demand from Holder, or default by Grantor under any other security instrument, loan agreement or other loan document pertaining to the Note if Grantor fails to cure such default within any applicable grace or cure period therein provided; or (c) the execution by Grantor of an assignment for the benefit of creditors; or (d) the levy against the Mortgaged Property, or any part thereof, of any execution, attachment, sequestration or other writ if Grantor fails to discharge, bond around or otherwise remove same within thirty (30) days after filing of same; or (e) the appointment of a receiver of Grantor, or of the Mortgaged Property, or any part thereof; or (f) the adjudication of Grantor as a bankrupt; or (g) the filing by Grantor either of a petition or answer for an adjudication as a bankrupt or seeking any other relief under any bankruptcy, reorganization, debtor's relief of insolvency law now or hereafter existing; or (h) the receipt by Holder of information unequivocally establishing that any representation or warranty made by Grantor herein, or in any other document delivered by Grantor to Holder and relied upon by Holder in connection herewith is materially false, misleading, erroneous or breached as of the date of this Deed of Trust; (i) default by Grantor in payment or performance of any of the Obligations if Grantor fails to cure such default within any applicable grace or cure period therein provided; or 0) default by Grantor in the performance of any of its obligations as lessee under the Lease if Grantor fails to cure such default within any applicable grace or cure period therein provided. Section 3.2 Upon a Default, Holder may, at its option, do any one or more of the following: (a) If Grantor has failed to keep or perform any covenant whatsoever contained in this Deed of Trust, Holder may; but shall not be obligated to any person to do so, perform or attempt to perform said covenant, and any payment made or expense incurred in the performance or attempted performance A any such covenants shall be a part of the Obligation, and Grantor promises upon demand, to pay to Holder, at the place where the Note is payable, or at such other place as Holder may direct by written notice, all sums so advanced or paid by Holder, with interest at the rate of ten (10%) percent per annum from the date when paid or incurred by Holder. No such payment by Holder shall constitute a waiver of {Al7\5852\0019\W0365244.1 } Page 10 of 20 Pages any Default. In addition to the liens and security interest hereof, Holder shall be subrogated to all rights, titles, liens and security interests securing the payment of any debt, claim, tax or assessment for the payment of which Holder may make an advance, or which Holder may pay. (b) Holder may, without notice, demand or presentment, which are hereby waived by Grantor and all other parties obligated in any manner whatsoever on the Obligation, declare the entire unpaid balance of the Obligation immediately due and payable, and upon such declaration the entire unpaid balance of the Obligation shall be immediately due and payable. (c) Holder may request Trustee to proceed with foreclosure, and in such event Trustee is hereby authorized and empowered, and it shall be his special duty, upon such request of the Holder, to sell the Mortgaged Property, or any part thereof. Any sale of any part of the Mortgaged Property located in the State of Texas shall be made in the county in which such Mortgaged Property is situated. Where any part of the Mortgaged Property located in the State of Texas is situated in more than one county, then notice as herein provided shall be given in both or all of such counties, and such notice shall designate the county where the Mortgaged Property will be sold. Notice of such proposed sale shall be given by posting written notice thereof at least twenty-one (21) days preceding the date of the sale at the courthouse door of the county in which the sale is to be made and if the Mortgaged Property is in more than one county, one notice shall be posted at the courthouse door of each county in which the Mortgaged Property is situated. In addition, the Holder of the Obligation to which the Power of Sale herein mentioned is related shall at least twenty-one (21) days preceding the date of any such sale, serve written notice of the proposed sale by Certified Mail on each person or entity obligated to pay such Obligation according to the records of such Holder. Service of such notice shall be completed upon deposit of the notice, enclosed in a postpaid wrapper, properly addressed to each person or entity at the most recent address as shown by the records of the Holder of the Obligation, in a Post Office or official depository under the care and custody of the United States Postal Service. The Affidavit of any person having knowledge of the facts to be the effect that such service was completed shall be prima facie evidence of the fact of service. Such sale shall be made at public auction between the hours of 10:00 A.M. and 4:00 P.M. on the first Tuesday in any month to the highest bidder for cash. After such sale, Trustee shall make to the purchaser or purchaser's Trustee good and sufficient deeds and assignments, in the name of Grantor, conveying the Mortgaged Property, or part thereof, so sold to the purchaser or purchasers with general warranty of title by Grantor. Sale of a part of the Mortgaged Property shall not exhaust the Power of Sale, but sales may be made from time to time until the Obligation is paid and performed in full. It shall not be necessary to have present or to exhibit at any such sale any of the Accessories. In addition to the rights and powers of the sale granted under the preceding provisions of this Subsection 3.2(c), if default is made in the payment of any installment of the Obligation, Holder, at its option, at once or at any time thereafter while any matured installment remains unpaid, without declaring the entire Obligation to be due and payable, may orally or in writing direct Trustee to enforce this Trust and to sell the Mortgaged Property subject to such unmatured indebtedness and the liens and security interests securing its payment, in the same manner, on the same terms, at the same place and time and after having given notice in the same manner, all as provided in the preceding provisions of this Subsection 3.2(c). After such sale, Trustee shall make due conveyance to the purchaser or purchasers. Sales made without maturing the Obligation may be made hereunder whenever there is a default in the payment of any installment of the Obligation without exhausting the Power of Sale granted hereby, and without affecting in any way the Power of Sale granted under this Section 3.2(c), the unmatured balance of the Obligation (except as to any proceeds of any sale which Holder may apply as prepayment of the {Al7\5852\0019\W0365244.1 } Page 11 of 20 Pages e Obligation) or the liens and security interest securing payment of the Obligation. It is intended by each of the foregoing provisions of this Subsection 3.2(c) that Trustee may, after any request or direction by Holder, sell, not only the Land but also, the Accessories and other interests constituting a part of the Mortgaged Property, or any part thereof, along with the Land, or any part thereof, all as a unit and a part A a single sale, of may sell any part of the Mortgaged Property separately from the remainder of the Mortgaged Property. It is agreed that, in any deed or deeds given by Trustee, any and all statements of fact or other recitals therein made as to the identity of the Holder, or as to the occurrence or existence of any Default, or as to the acceleration of the maturity of the Obligation, or as to the request to sell, notice A sale, time, place, terms and manner of sale, and receipt, distribution and application of the money realized therefrom, or as to the due and proper appointment of a substitute trustee, and, without being limited by the foregoing, as to any other act or thing having been duly done by Holder or by Trustee in accordance with the terms of this Deed of Trust, shall be taken by all courts of law and equity as prima facie evidence that the said statements or recitals state factors and are without further question to be so accepted, and Grantor does hereby ratify and confirm any and all acts that Trustee may lawfully do in the premises by virtue hereof. In the event of the resignation or death of Trustee, or his removal from his county of residence or inability, for any reason, to make any such sale or to perform any of the trusts herein declared, or at the option of Holder, without cause, then Holder may appoint, in writing, a substitute trustee, who shall thereupon succeed to all the estates, titles, rights, powers and trusts herein granted to and vested in Trustee. If Holder is a corporation, such appointment may be made on behalf of such Holder by any person who is then the president, or a vice or the cashier or secretary, or any other authorized officer of agent, of Holder. In the event of the resignation or death of any such substitute trustee, or his failure, refusal or inability to make any such sale or perform such trusts, or at the option of Holder, without cause, successive substitute trustees may thereafter, from time to time, be appointed in the same manner. Wherever herein the word "Trustee" is used, the same shall mean the person who is the duly appointed trustee or substitute trustee hereunder at the time in question. (d) Holder may, or Trustee may upon written request of Holder, proceed by suit or suits, at law or in equity, to enforce the payment and performance of the Obligation in accordance with the terms hereof and of the Note or other instruments evidencing it, to foreclose the liens, security interests and this Deed of Trust as against all or any part of the Mortgaged Property, and to have all or any part of the Mortgaged Property sold under the judgment or decree of a court of competent jurisdiction. (e) Holder, as a matter of right and without regard to the sufficiency of the security, and without any showing of insolvency, fraud or mismanagement on the part of Grantor, and without the necessity of filing any judicial or other proceeding, other than the proceeding for appointment of a receiver or receivers of the Mortgaged Property, or any part thereof, shall take control of all receipts of the Mortgaged Property, and of the income, rents, issues and profits thereof. (f) Holder may enter upon the Land, take possession of the Mortgaged Property and remove the Accessories, or any part thereof, with or without judicial process, and, in connection therewith, without any responsibility or liability on the part of Holder, take possession of any property located on or in the Mortgaged Property which is not a part of the Mortgaged Property and hold or store such property at Grantor's expense. (g) Holder may require Grantor to assemble to Accessories, or any part thereof, and make them available to Holder at a place to be designated by Holder which is reasonably convenient to {Al7\5852\0019\W0365244.1 } Page 12 of 20 Pages Grantor and Holder. (h) After notification, if any, hereafter provided in this Subsection 3.2(h), Holder may sell, lease or otherwise dispose of, at the office of Holder, or on the Land, or elsewhere, as chosen by Holder, all or any part of the Accessories, in their then condition, or following any commercially reasonably preparation or processing, and each Sale (as used herein, the term "Sale" means any such sale, lease or other disposition made pursuant to this Subsection 3.2(h)) may be as a unit or in parcels, by public or private proceedings, and by way of one or more contracts, and, at any Sale, it shall not be necessary to exhibit the Accessories, or part thereof, being sold. The Sale of any part of the Accessories shall not exhaust Holder's Power of Sale, but Sales may be made from time to time until the Obligation is paid and performed in full. Reasonable notification of the time and place of any public Sale pursuant to this Subsection 3.2(h) or reasonable notification of the time of any private Sale is to be made pursuant to this Subsection 3.2(h), shall be sent to Grantor and to any other person entitled under the Uniform Commercial Code of the State of Texas ("Code") to notice; provided that if the Accessories, or part thereof, being sold are perishable, or threaten to decline speedily in value, or are of a type customarily sold on a recognized market, Holder may sell, lease or otherwise dispose of the Accessories, or part thereof, being sold, leased or otherwise disposed of without notification, advertisement or other notice of any kind. It is agreed that notice sent or given not less than five (5) calendar days prior to the taking of the action to which the notice relates, is reasonable notification and notice for the purposes of this Subsection 3.2(h). (i) Holder may surrender the insurance policies maintained pursuant to Section 2.2(b) hereof, or any part thereof, and receive and apply the unearned premiums as a credit on the Obligation, and, in connection therewith, Grantor hereby appoints Holder as the agent and attorney -in -fact for Grantor to collect such premiums. (j) Holder may retain the Accessories in satisfaction of the Obligation whenever the circumstances are such that Holder is entitled to do so under the Code. (k) Holder may buy the Mortgaged Property, or any part thereof, at public Sale or judicial sale. (1) Holder may buy the Accessories, or any part thereof, at any private Sale if the Accessories, or part thereof, being sold are a type customarily sold in a recognized market or are a type which is the subject of widely distributed standard price quotations. (m) Holder shall have and may exercise any and all other rights and remedies which Holder may have at law or in equity, or by virtue of any other security instrument, or under the Code, or otherwise. (n) Holder may apply the reserves, if any, required by Section 5.9 hereof, toward payment of the Obligation. (o) If Grantor fails to perform any of its obligations under the Lease, Holder may, at Holder's option, perform any obligations of Grantor under the Lease and be reimbursed by Grantor upon demand for all sums paid or expended by Holder in so doing, together with all reasonable attorney's fees incurred {A17\5852\0019\W0365244.1 } Page 13 of 20 Pages by Holder, which sums shall be secured by this Deed of Trust and shall bear interest at the default rate set forth in the Note, and enter upon the Land to the extent necessary or convenient in order for Holder to so perform any obligations of Grantor under the Lease. To the extent that Holder performs any obligations of Grantor under the Lease, Holder shall be subrogated to the rights of landlord under the Lease. Section 3.3 If Holder is the purchaser of the Mortgaged Property, or any part thereof, at any Sale thereof, whether such Sale be under the Power of Sale hereinabove vested in Trustee, or upon any other foreclosure of the liens and security interests hereof, or otherwise, Holder shall, upon any such purchase, acquire good title to the Mortgaged Property so purchased, free of the liens and security interests of these presents. Section 3.4 Should any part of the Mortgaged Property come into the possession of Holder, whether before or after Default, Holder may use or operate the Mortgaged Property for the purpose of preserving it or its value, pursuant to the order of a court appropriate jurisdiction, or in accordance with any other rights held by Holder in respect of the Mortgaged Property. Grantor covenants to promptly reimburse and pay to Holder, at the place where the Note is payable, or at such other place as may be designated by Holder in writing, the amount of all reasonable expenses (including the cost of any insurance, taxes or other charges) incurred by Holder in connection with its custody, preservation, use or operation of the Mortgaged Property, together with interest thereon from the date incurred by Holder at the rate of ten (10%) per cent per annum, and all such expenses, cost, taxes, interest and other charges shall be a part of the Obligation. It is agreed, however, that the risk of accidental loss or damage to the Mortgaged Property is on Grantor, and Holder shall have no liability whatever for decline in value of the Mortgaged Property, nor for failure to determine whether any insurance ever in force is adequate as to amount or as to the risks insured, unless such liability or failure arises out of the gross negligence or willful misconduct of Holder. Section 3.5 In case the liens or security interests hereof shall be foreclosed by Trustee's sale, or by other judicial or non -judicial action, the purchaser at any such Sale shall receive, as an incident to his ownership, immediate possession of the property purchased, and if Grantor or Grantor's successors shall hold possession of said property, or any part thereof, subsequent to foreclosure, Grantor and Grantor's successors shall be considered as tenants at sufferance of the purchaser at foreclosure sale, and anyone occupying the property after demand made for possession thereof shall be guilty of forcible detainer and shall be subject to eviction and removal, forcible or otherwise, with or without process of law, and all damages by reason thereof are hereby expressly waived. Section 3.6 The proceeds from any Sale, lease of other disposition made pursuant to this Article III, or the proceeds from surrendering any insurance policies pursuant to Subsection 3.2(i) hereof, or any Rental collected by Holder pursuant to Article IV hereof, or the reserves required by Section 5.9 hereof, or sums received pursuant to Section 5.7 hereof, or proceeds from insurance which Holder elects to apply to the Obligation pursuant to Section 5.8 hereof, shall be applied by Trustee, or by Holder, as the case may be, as follows: First, to the payment of all expenses of advertising, selling and conveying the Mortgaged Property, or part thereof, including a reasonable commission to Trustee not to exceed five (5%) per cent of the proceeds of the Sale, and reasonable attorney's fees; second, to interest on the Obligation; third, to principal on the matured portion of the Obligation; fourth, to prepayment of the unmatured portion, if any, of the Obligation applied to installments of principal in inverse order of maturity; and fifth, the balance, if any, remaining after the full and final payment and performance of the Obligation, to Grantor. {A17\5852\0019\W0365244.1 } Page 14 of 20 Pages Section 3.7 In the event a foreclosure hereunder should be commenced by Trustee in accordance with Subsection 3.2(c) hereof, Holder may at any time before the Sale direct Trustee to abandon the Sale, and may then institute suit for the collection of the Note, and for the foreclosure of the liens and security interest hereof. If Holder should institute a suit for the collection of the Note, and for a foreclosure of the liens and security interests hereof, it may at any time before the entry of a final judgment in said suit dismiss the same, and require Trustee to sell the Mortgaged Property, or any part thereof, in accordance with the provisions of this Deed of Trust. Section 3.8 This Deed of Trust shall not be construed as an assignment of the Lease to Holder, and Holder shall have no liability or obligation under the Lease by reason of the giving and acceptance of this Deed of Trust. In the event that the Lease is assigned to Holder at foreclosure sale or otherwise, Holder shall succeed to the obligations of Grantor as tenant under the Lease only to the extent that such obligations accrue and are payable during and with respect to the period of time that Holder is the owner of the leasehold estate under the Lease. ARTICLE IV Sub -Leases and Assignment of Rental Section 4.1 As used in this Deed of Trust: (a) "Sub -Lease" means any lease, sublease or other agreement under the terms of which any person other than Grantor has or acquires any right to occupy or use the Mortgaged Property, or any part thereof, or interest therein; (b) "Lessee" means the lessee, sublessee, tenant or other person having the right to occupy or use a part of the Mortgaged Property under a Sub -Lease; and (c) "Rental" means the rents, royalties and other consideration payable to Grantor by the Lessee under the terms of a Sub -Lease. Section 4.2 Grantor hereby assigns to Holder all Rental payable under each Sub -Lease now or at any time hereafter existing, such assignment being upon the following terms: (a) Until receipt from Holder of notice of the occurrence of a Default, each Lessee may pay Rental directly to Grantor, but Grantor covenants to hold all Rental so paid in trust for the use and benefit of Holder; (b) upon receipt from Holder of notice that a Default exists, each Lessee is hereby authorized and directed to pay directly to Holder all Rental thereafter accruing, and the receipt of Holder shall be a release of such Lessee to the extent of all amounts so paid; (c) Rental so received by Holder shall be applied by Holder, first to the expenses, if any, of collection and then in accordance with Section 3.6; (d) without impairing its rights hereunder, Holder may, at its option, at any time and from time to time, release to Grantor Rental so received by Holder, of any part thereof; (e) Holder shall not be liable for its failure to collect, or its failure to exercise diligence in the collection of, Rental, but shall be accountable only for Rental that it shall actually receive; and (f) this assignment shall terminate upon the release of this Deed of Trust but no Lessee shall be required to take notice of termination until a copy of such release shall have been delivered to such Lessee. As between Holder and Grantor, and any person claiming through or under Grantor, other than a Lessee who has not received notice of Default pursuant to Subsection 4.2(b), the assignment contained in this Section 4.2 is intended to be absolute, unconditional and presently effective, and the provisions of Subsections 4.2(a) and 4.2(b) are intended solely for the benefit of Grantor of any person claiming through or under Grantor, other than a Lessee who has not received such notice. It shall never be necessary for Holder to institute legal proceedings of any kind whatsoever to enforce the provisions of this Section 4.2. Section 4.3 Nothing in this Article IV shall ever be construed as subordinating this Deed of Trust to any Sub -Lease. {A17\5852\0019\W0365244.1 } Page 15 of 20 Pages Section 4.4 In the event Holder ever collects Rental, Holder shall be entitled to pay its agent as compensation for collecting such Rental, from sums so collected, a sum not to exceed five (5 %) percent of the Rental so collected. ARTICLE V Miscellaneous Section 5.1 If the Obligation is paid and performed in full accordance with the terms of this Deed of Trust and the Note and other instruments evidencing it, and if Grantor shall well and truly perform all of Grantor's covenants contained herein, then this conveyance shall become null and void and be released at Grantor's request and expense; otherwise, it shall remain in full force and effect, provided that no release hereof shall impair Grantor's warranties and indemnities contained herein. Section 5.2 As used in this Article V, "Rights" means rights, remedies, powers and privileges, and "Liens" means titles, interests, liens and security interests. All Rights and Liens herein, or by law or in equity provided, or provided in any other security instrument and shall not be deemed to deprive Holder or Trustee of any such other legal or equitable Rights and Liens by judicial proceedings, or otherwise, appropriate to enforce the conditions, covenants and terms of this Deed of Trust, the Note and other security instruments, and the employment of any Rights hereunder, or otherwise, shall not prevent the concurrent or subsequent employment of any other appropriate Rights. Section 5.3 Any and all covenants in this Deed of Trust may from time to time, by instrument in writing signed by Holder and delivered to Grantor, be waived to such extent and in such manner as Holder may desire, but no such waiver shall ever affect or impair Holder's Rights or Liens hereunder, except to the extent so specifically stated in such written instrument. Impossibility shall not excuse the performance of any covenant or condition in this Deed of Trust. Section 5.4 Any provision herein, or in the Note or any other document executed in connection herewith, to the contrary notwithstanding, no Holder shall in any event be entitled to receive or collect, nor shall or may the amounts received hereunder be credited, so that a Holder shall be paid, as interest, a sum greater than the maximum amount permitted by the laws of the State of Texas to be charged to the person, firm or corporation primarily obligated to pay to Obligation at the time in question. If any construction of this Deed of Trust or the Note, or any and all other papers, indicates a different right given to Holder to ask for, demand or receive any larger sum, as interest, such is a mistake in calculation or wording, which this clause shall override and control, and proper adjustment shall automatically be made accordingly. Section 5.5 In the event Grantor or any of Grantor's successors conveys his interest in the Mortgaged Property, or any part thereof, to any other party, Holder may, without notice to Grantor or Grantor's successors deal with any owner of any part' of the Mortgaged Property with reference to this Deed of Trust and the Obligation, either by way of foreclosure on the part of Holder, or extension of time of payment of the Obligation, or release of all or any part of the Mortgaged Property, or any other property securing payment of the Obligation, without in any way modifying or affecting Holder's Rights and Liens hereunder or the liability of Grantor or any other party liable for payment of the Obligation, in whole or in part. Section 5.6 Grantor hereby waives all rights of marshaling in event of any foreclosure of the liens and {A17\5852\0019\W0365244.1 } Page 16 of 20 Pages security interests hereby created. Grantor also waives all rights and defenses under Sections 51.003 and 51.004 of the Texas Propel ty Code. Section 5.7 •:Holder shall be entitled to receive any and all sums which may be awarded or become payable to Grantor for the condemnation of the Mortgaged Property, or any part thereof, for public or quasi - public use, or by virtue of private sale in lieu thereof, and any sums which may be awarded or become payable to Grantor for damages caused by public works or construction on or near the Mortgaged Property. All such sums are hereby assigned to Holder, and Grantor shall, upon request of Holder, make, execute, acknowledge and deliver any and all additional assignments and documents as may be necessary from time to time to enable Holder to collect and receipt for any such sums. Holder shall not be, under any circumstances, liable or responsible for failure to collect, or exercise diligence in the collection of, any of such sums. Any sums collected under this Section 5.7 shall be applied first to any expenses incurred by Holder in connection therewith, if any, and then in accordance with Section 3.6. Section 5.8 Holder may collect the proceeds of any and all insurance that may become payable with respect to the Mortgaged Property, or any part thereof, and, at its option, may use the same to rebuild or restore the improvements on the Mortgaged Property or may apply the same to the Obligation in the order and manner set forth in Section 3.6 hereof, whether then matured or to mature in the future, and may deduct therefrom any expenses incurred in --connection with the collection or handling of such proceeds, it being understood that Holder shall not be, under any circumstances, liable or responsible for failure to collect, or exercise diligence in the collection of, any of such proceeds. Section 5.9 At the request of Holder and if Grantor has failed to make prompt and full payment of any insurance premiums, taxes, or assessments against the Mortgaged Property, Grantor shall create a fund or reserve for the payment of all insurance premiums, taxes and assessment against the Mortgaged Property by paying to Holder contemporaneously with each installment of principal and interest on the Note a sum equal to the premiums that will next become due and payable on the hazard insurance policies covering the Mortgaged Property, or any part thereof, plus taxes and assessments next due on the mortgaged Property, or any part thereof, as estimated by Holder, less all sums paid previously to Holder therefor, divided by the number of months to elapse before one month prior to the date when such premiums, taxes and assessments will become delinquent, such sums to be held by Holder without interest, for the purposes of paying such premiums, taxes and assessments. Any excess reserve shall, at the discretion of Holder, be credited by Holder on subsequent payments to be made on the Obligation by Grantor, and any deficiency shall be paid by Grantor to Holder on or before the date when such premiums, taxes and assessments shall become delinquent. Transfer of legal title to the Mortgaged Property as a result of foreclosure of this Deed of Trust (or a transfer to Holder in lieu of foreclosure) shall automatically transfer title in all sums deposited under the provisions of this Section 5.9. Section 5.10 It is understood and agreed that the proceeds of the Note, to the extent the same are utilized to renew or extend any indebtedness or take up any outstanding Liens against the Mortgaged Property, or any portion thereof, have been advanced by Holder at Grantor's request and upon Grantor's representation that such amounts are due and payable. Holder shall be subrogated to any and all Rights and Liens owned or claimed by any owner or holder of said outstanding Rights and Liens, however remote, regardless of whether said Rights and Liens are acquired by assignment or are released by the Holder thereof upon payment. Section 5.11 Each and every party who signs this Deed of Trust, other than Holder, and each and every subsequent owner of the Mortgaged Property, or any part thereof, covenants and agrees that he or it will perform {A17\5852\0019\W0365244.1 } Page 17 of 20 Pages or cause to be performed, each and every condition, term, provision and covenant of this Deed of Trust, except that he shall have no duty to pay the indebtedness evidenced by the Note except in accordance with the terms of the transfer to him. Wherever this Deed of Trust required notice to Grantor, such notice shall be deemed to have been given three (3) days after it is deposited in the United States mail in an envelope addressed to Grantor at the address stated on the first page hereof, or at such other address as Grantor may designate by notice in writing to Holder. Section 5.12 If the Rights and Liens created by this Deed of Trust shall be invalid or unenforceable as to any part of the Obligation, the unsecured portion of the Obligation shall be completely paid prior to the payment of the remaining and secured portion of the Obligation, and all payments made on the Obligation shall be considered to have been paid on and applied first to the complete payment of the unsecured portion of the Obligation. Section 5.13 This Deed of Trust is binding upon Grantor and Grantor's successors, and shall inure to the benefit of Holder, and its successors and assigns, and the provisions hereof shall likewise be covenants running with the Land. The duties, covenants, conditions, obligations and warranties of Grantor in this Deed of Trust shall be joint and several obligation of Grantor and Grantor's successors. Section 5.14 This Deed of Trust is also a financing statement. Section 5.15 This Deed of Trust is given in part in renewal and extension of, and not in extinguishment of (i) that certain deed of trust dated September 14, 2006, executed by Grantor for the benefit of Regions Bank, filed for record in the office of the County Clerk of Tarrant County, Texas on September 18, 2006 under Clerk's File No. D206291161, and (ii) that certain assignment of rents dated September 14, 2006, executed by Grantor for the benefit of Regions Bank, recorded in the office of the County Clerk of Tarrant County, Texas under Clerk's File No. D206291162. The Note is given in part in renewal, extension and modification of the indebtedness described in and secured by the said deed of trust and assignment of rents. EXECUTED AND DELIVERED, as of the _day of August, 2008. GRANTOR: FWS Realty, Ltd., Acting By and Through Its General Partner, Harrison Realty Investments, LLC By: Haydn H. Cutler, Jr., Member and Manager {A17\5852\0019\W0365244.1 } Page 18 of 20 Pages STATE OF TEXAS § COUNTY OF TARRANT § This instrument was acknowledged before me on August , 2008, by Haydn H. Cutler, Jr., Member and Manager of Harrison Realty Investments, LLC, a Texas limited liability company, the general partner of FWS Realty, Ltd., a Texas limited partnership, on behalf of said partnership. Notary Public, State of Texas AFTER RECORDING RETURN TO: Regions Bank Attn: Debbie Garner 1500 North 181h Street Monroe, LA 71201 {A17\5852\0019\W0365244.1 } Page 19 of 20 Pages Tract 1: EXHIBCI' "A" BEING a 1.083 acre tract 0 of land, situated in the SARAH GRAY SURVEY, ABSTRACT No. 558 in Tarrant County, Texas, and being a part of Block 1 as shown on the Final Plat of Fort Worth Spinks Airport recorded in Cabinet A, Slide 353, of the Plot Records of Tarrant County, Texas, and being more particularly described by metes and bounds us follows: COMMENCING at a el/2 inch iron rod found in the west line of Stone Rood (90right- of —way) for the north corner of Block I —A of said Fort Worth Spinks Airport Addition, said corner called on said plat to be 1805.74 feet in a southerly direction along the west line of Stone Road from the south line of East Alsbury Boulevard; THENCE North 00'00114" East along the west line of said Stone Road a distance of 1352.90 feet to a point: THENCE North 89'55'20" East departing said west line of Stone Road a distance of 289.21 feet to a 5/8 inch capped iron rod, stamped "CHA", set in the west line of Block 1, some being the east line of Wing Way Road (44' R.O.W.), some being the southwest corner of that called 1.083 acre tract described in Exhibit "A" of the Memorandum of Lease recorded in Doc. No. 0206276858, D.R.T.C,T., for the POINT OF BEGINNING of the herein described tract; THENCE North 00'04'40" West, along the east line of Wing Way Road, a distance of 240,00 feet to a PK nail set for corner; THENCE North 89'55'20" East, deporting said east line, a distance of 196.61 feet to on X—Cut set for corner;- THENCE South 00'02'19" West, a distance of 240.00 feet to an X—Cut set for corner; THENCE South 89'55'20" West, a distance of 196.13 to THE POINT OF BEGINNING and containing 47,128 square feet or 1.083 acres of land, more or less, Tract 2: BEING a 0.367 acre tract of land, situated in the SARAH GRAY SURVEY, ABSTRACT No. 558 in Tarrant County, Texas, and being a part of Block 3 as shown on the Final Plat of Fort Worth Spinks Airport recorded in Cabinet A. Slide 353, of the Plat Records of Tarrant County, Texas, and being more particularly described by metes and bounds as follows; COMMENCING at a. 1/2 inch iron rod found in the west line of Stone Road (90' right—of—woy) for the north corner of Block 1—A of said Fort Worth Spinks Airport Addition, said corner called on said Plat to be be 1805.74 feet in a southerly direction along the west line of Stone Road from the south line of East Alsbury Boulevard (90' right—of—way); THENCE North 00'00014" East along the west line of said Stone Rood, a distance of 1805.74 feet to a point; THENCE East (North 90'00'00" East), departing said Stone Road and along the south line of said East Alsbury Boulevard a distance of 401.01 feet to a point; THENCE North 00'02'18" West, departing said south line a distance of 31.38 feet to an X—CUT set for corner for the POINT OF BEGINNING of the herein described tract; THENCE North 00'02'18" East, a distance of 200.00 feet to an X—CUT set for corner; THENCE South 89*57142" East, a distance of 80.00 feet to a 5/8 inch iron rod with cap stamped "CHA" set for corner; THENCE South 00*02'18" West, a distance of 200.00 feet to an X—CUT set for corner; THENCE North SW57'42" West, a distance of 80.00 feet to the POINT OF BEGINNING and containing 16,000 square feet or 0.367 acres of land, more or less. City of Fort VI/orth, Texas Mayor and Council Communication DATE: Tuesday, September 02, 2008 LOG NAME: 55FWS NEW DOT REFERENCE NO.: **C-23005 SUBJECT: Authorize Execution of a Written Consent to Deed of Trust Lien by FWS Realty, Ltd., in Favor of Regions Bank for the Terminal Building at Fort Worth Spinks Airport RECOMMENDATION: It is recommended that the City Council authorize the City Manager to execute a written consent to Deed of Trust Lien by FWS Realty, Ltd., in favor of Regions Bank for the Terminal Building at Fort Worth Spinks Airport. DISCUSSION: On May 18, 2004, (M&C C-20086) City Council approved execution of an unimproved ground lease with mandatory improvements with FWS Realty, Ltd., for a phased development project at Fort Worth Spinks Airport. One of these developments was an FBO Terminal Building which FWS Realty, Ltd., managed by Haydn Cutler, currently leases the ground for the terrinal building at Fort Worth Spinks Airport pursuant to City Secretary Contract (CSC) No. 30655. FWS Realty, Ltd., wishes to put up the 7,400 square foot executive terminal building as collateral. FWS Realty, Ltd., wishes to obtain financing for the 7,400 square foot executive terminal building from Regions Bank. Accordingly, Mr. Cutler 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 FWS Realty, Ltd., if approved by the City Council, in the event that FWS Realty, Ltd., defaults on the loan or their lease with the City of Fort Worth. The Lease Agreement prohibits FWS Realty, Ltd., or Haydn Cutler 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. Cutler'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 affect on City funds. TO Fund/Account/Centers FROM Fund/Account/Centers Submitted for City Manager's Office bv: Tom Higgins (6266) Originating Department Head: Kent Penney (5403) Additional Information Contact: Patrick Carreno (447-8304) Logname: 55FWS NEW DOT Page 1 of 1 ity o ort orfh, xa � E P m �� �Ec'Q • • • • • DATE: Tuesday, September 02, 2008 LOG NAME: 55FWS NEW DOT REFERENCE NO.: **C-23005 SUBJECT: Authorize Execution of a Written Consent to Deed of Trust Lien by FWS Realty, Ltd., in Favor of Regions Bank for the Terminal Building at Fort Worth Spinks Airport RECOMMENDATION: It is recommended that the City Council authorize the City Manager to execute a written consent to Deed of Trust Lien by FWS Realty, Ltd., in favor of Regions Bank for the Terminal Building at Fort Worth Spinks Airport. DISCUSSION: On May 18, 2004, (M&C C-20086) City Council approved execution of an unimproved ground lease with mandatory improvements with FWS Realty, Ltd., for a phased development project at Fort Worth Spinks Airport. One of these developments was an FBO Terminal Building which FWS Realty, Ltd., managed by Haydn Cutler, currently leases the ground for the terminal building at Fort Worth Spinks Rirport pursuant to City Secretary Contract (CSC) No. 30655. FWS Realty, Ltd., wishes to put up the 7,400 square foot executive terminal building as collateral. FWS Realty, Ltd., wishes to obtain financing for the 7,400 square foot executive terminal building from Regions Bank. Accordingly, Mr. Cutler 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 FWS Realty, Ltd., if approved by the City Council, in the event that FWS Realty, Ltd., defaults on the loan or their lease with the City of Fort Worth. The Lease Agreement prohibits FWS Realty, Ltd., or Haydn Cutler 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. Cutler'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 affect on City funds. TO Fund/Account/Centers FROM Fund/Account/Centers Submitted for City Manager's Office bv: Tom Higgins (6266) Originating Department Head: Kent Penney (5403) Additional Information Contact: Patrick Carreno (447-8304) Logname: 55FWS NEW DOT Page 1 of 1