EXHIBIT 6.3 AMERICAN ENERGY SERVICES, INC. 7224 LAWNDALE HOUSTON, TX 77539 TAXPAYER I.D. NUMBER: 76-0279883 METROBANK, N.A. GALLERIA BRANCH 5065 WESTHEIMER, STE. #1111 HOUSTON, TX 77056 SECURED PARTY'S NAME AND ADDRESS ("You" means the Secured Party,...

EXHIBIT 6.3

AMERICAN ENERGY SERVICES, INC.
0000 XXXXXXXX
XXXXXXX, XX 00000

TAXPAYER I.D. NUMBER: 00-0000000

METROBANK, N.A. GALLERIA BRANCH
0000 XXXXXXXXXX, XXX. #0000
XXXXXXX, XX 00000

SECURED PARTY'S NAME AND ADDRESS
("You" means the Secured Party, its successors and assigns.)

I am entering into this security agreement with you on MAY 2, 1998 (date).

SECURED DEBTS. I agree that this security agreement will secure the payment and
performance of the debts, liabilities or obligations described below that (Check
one) [ ] I [X] AMERICAN ENERGY SERVICES, INC., LOAN #721099972, DTD.
05-02-98; I/A/O $2,000,000 owe(s) to you now or in the future:ttttttttt
(Check one below):

[X] SPECIFIC DEBT(S): The debt(s), liability or obligations evidenced by
(describe): NOTE #721099972 FROM AMERICAN ENERGY SERVICES, INC. and
all extensions, renewals, refinancings, modifications and replacements
of the debt, liability or obligation.

[ ] ALL DEBT(S). Except in those cases listed in the "LIMITATIONS"
paragraph on page 2, each and every debt, liability and obligation of
every type and description (whether such debt, liability or obligation
now exists or is incurred or created in the future and whether it is
or may be direct or indirect, due or to become due, absolute or
contingent, primary or secondary, liquidated or unliquidated, or
joint, several or joint and several).

SECURITY INTEREST. To secure the payment and performance of the above described
Secured Debts, liabilities and obligations, I give you a security interest
in all of the property described below, that I now own and that I may own
in the future (including, but not limited to, all parts, accessories,
repairs, improvements, and accessions to the property), wherever the
property is or may be located, and all proceeds and products from the
property.

[X] INVENTORY: All inventory which I hold for ultimate sale or lease, or
which has been or will be supplied under contracts of service, or
which are raw materials, work in process, or materials used or
consumed in my business:

[X] EQUIPMENT: All equipment including, but not limited to, all machinery,
vehicles, furniture, fixtures, manufacturing equipment, farm machinery
and equipment, shop equipment, office and recordkeeping equipment, and
parts and tools. All equipment described in a list or schedule which I
give to you will also be included in the secured property, but such a
list is not necessary for a valid security interest in my equipment.

[ ] FARM PRODUCTS: All farm products, but not limited to:

(a) all poultry and livestock and their young, along with their
products, produce and replacements;

(b) all crops, annual or perennial, and all products of the crops; and

[X] ACCOUNTS, INSTRUMENTS, DOCUMENTS, CHATTEL PAPER AND OTHER RIGHTS TO
PAYMENT: All rights I have now and that I may have in the future to
the payment of money, including but not limited to: (a) payment for
goods and other property sold or leased or for services rendered,
whether or not I have earned such payment by performance; and (b)
rights to pay arising out of all present and future debt instruments,
chattel paper and loans and obligations receivable. The above includes
any rights and interests (including all liens and security interests)
which I may have by law or agreement against any account debtor or
obligor of mine.

[X] GENERAL INTANGIBLES: All general intangibles including, but not
limited to, tax refunds, applications for patents, patents,
copyrights, trademarks, trade secrets, good will, trade names,
customer lists, permits and franchises, and the right to use my name.

[ ] GOVERNMENT PAYMENTS AND PROGRAMS: All payments, accounts, general
intangibles, or other benefits (including, but not limited to,
payments in kind, deficiency payments, letters of entitlement,
warehouse receipts, storage payments, emergency assistance payments,
diversion payments, and conservation reserve payments) in which I now
have and in the future may have any rights or interest and which arise
under or as a result of any preexisting, current or future Federal or
state governmental program (including, but not limited to, all
programs administered by the Commodity Credit Corporation and the
ASCS).

[X] THE SECURED PROPERTY INCLUDES, BUT IS NOT LIMITED BY, THE FOLLOWING:

SEE EXHIBIT "A" ATTACHED HERETO AND MADE A PART HEREOF

If this agreement covers timber to be cut, minerals (including oil and gas),
fixtures or crops growing or to be grown, the legal description is:
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I am a(n) [ ] Individual [ ] partnership [X] corporation

[ ] ________________________________________________

[ ] If checked, file this agreement in the real estate records.
Record Owner (if not me):
___________________________________________________________________

___________________________________________________________________

The property will be used for [ ] personal [X] business
[ ] agricultural [ ]________________ reasons.

METROBANK, N.A. GALLERIA BRANCH
(Secured Party's Name)

By: XXXX XXXXXXXXX

Title: VICE PRESIDENT

I AGREE TO THE TERMS SET OUT ON BOTH PAGE 1 AND PAGE 2 OF THIS AGREEMENT.
I have received a copy of this document on today's date.

AMERICAN ENERGY SERVICES, INC.
(Debtor's Name)

By: /s/ XXX XXXXXXX
NAME:

Title: PRESIDENT

By:
NAME:

Title:

(page 1 of 2)

GENERALLY -- "You" means the Secured Party identified on page 1 of this
agreement. "I," "me" and "my" means each person who signs this security
agreement as Xxxxxx and who agrees to give the property described in this
agreement as security for the Secured Debts. All terms and duties under this
agreement are joint and individual. No modification of this security agreement
is effective unless made in writing and signed by you and me. This security
agreement remains in effect, even if the note is paid and I owe no other debt to
you, until discharged in writing. Time is of the essence in this agreement.

APPLICABLE LAW -- I agree that this security agreement will be governed by the
law of the state in which you are located. If property described in this
agreement is located in another state, this agreement may also, in some
circumstances, be governed by the law of the state in which the property is
located.

To the extent permitted by law, the terms of this agreement may vary
applicable law. If any provision of applicable law may not be varied by
agreement, any provision of this agreement that does not comply with that law
will not be effective. If any provision of this agreement cannot be enforced
according to its terms, this fact will not affect the enforceability of the
remainder of this agreement.

OWNERSHIP AND DUTIES TOWARD PROPERTY -- I represent that I own all of the
property, or to the extent this is a purchase money security interest I will
acquire ownership of the property with the proceeds of the loan, I will defend
it against any other claim. Your claim to the property is ahead of the claims of
any other creditor. I agree to do whatever you require to protect your security
interest and to keep your claim in the property ahead of the claims of other
creditors. I will not do anything to harm your position.

I will keep books, records and accounts about the property and my business
in general. I will let you examine these records at any reasonable time. I will
prepare any report or accounting you request, which deals with the property.

I will keep the property in my possession and will keep it in good repair
and use it only for the purpose(s) described on page 1 of this agreement. I will
not change this specified use without your express written permission. I
represent that I am the original owner of the property and, if I am not, that I
have provided you with a list of prior owners of the property.

I will keep the property at my address listed on page 1 of this agreement,
unless we agree I may keep it at another location. If the property is to be used
in another state, I will give you a list of those states. I will not try to sell
the property unless it is inventory or I receive your written permission to do
so. If I sell the property I will have the payment made payable to the order of
you and me.

You may demand immediate payment of the debt(s) if the debtor is not a
natural person and without your prior written consent (1) a beneficial interest
in the debtor is sold or transferred or (2) there is a change in either the
identity or number of members of a partnership or (3) there is a change in
ownership of more than 25 percent of the voting stock of a corporation.

I will pay all taxes and charges on the property as they become due. You
have the right of reasonable access in order to inspect the property. I will
immediately inform you of any loss or damage to the property.

LIMITATIONS -- This agreement will not secure a debt described in the
section entitled "Secured Debts" on page 1:

1) if you fail to make any disclosure of the existence of this security
interest required by law for such other debt;
2) if this security interest is in my principal dwelling and you fail to
provide (to all persons entitled) any notice of right of rescission
required by law for such other debt;
3) to the extent that this security interest is in "household goods" and
the other debt to be secured is a "consumer" loan (as those terms are
defined in applicable federal regulations governing unfair and deceptive
credit practices);
4) if this security interest is in margin stock subject to the requirements
of 12 C.F.R. Section 207 or 221 and you do not obtain a statement of
purpose if required under these regulations with respect to that debt;
or
5) if this security interest is unenforceable by law with respect to that
debt.

PURCHASE MONEY SECURITY INTEREST -- For the sole purpose of determining the
extent of a purchase money security interest arising under this security
agreement: (a) payments on any non-purchase money loan also secured by this
agreement will not be deemed to apply to the purchase money loan, and (b)
payments on the purchase money loan will be deemed to apply first to the
non-purchase money portion of the loan, if any, and then to the purchase money
obligations in the order in which the items of collateral were acquired or if
acquired at the same time, in the order selected by you. No security interest
will be terminated by application of this formula. "Purchase money loan" means
any loan the proceeds of which, in whole or in part, are used to acquire any
collateral securing the loan and all extensions, renewals, consolidations and
refinancings of such loan.

AUTHORITY OF SECURED PARTY TO MAKE ADVANCES AND PERFORM FOR DEBTOR -- I agree to
pay you on demand any sums you advanced on my behalf including, but not limited
to, expenses incurred in collecting, insuring, conserving, or protecting the
property or in any inventories, audits, inspections or other examinations by you
in respect to the property. If I fail to pay such sums, you may do so for me,
adding the amount paid to the other amounts secured by this agreement. All such
sums will be due on demand and will bear interest at the highest rate provided
in any agreement, note or other instrument evidencing the Secured Debt(s) and
permitted by law at the time of the advance.

If I fail to perform any of my duties under this security agreement, or any
mortgage, deed of trust, lien or other security interest, you may without notice
to me perform the duties or cause them to be performed. I understand that this
authorization includes, but is not limited to, permission to: (1) prepare, file,
and sign my name to any necessary reports or accountings; (2) notify any account
debtor of your interest in this property and tell the account debtor to make the
payments to you or someone else you name, rather than me; (3) place on any
chattel paper a note indicating your interest in the property; (4) in my name,
demand, collect, receive and give a receipt for, compromise, settle, and handle
any suits or other proceedings involving the collateral; (5) take any action you
feel is necessary in order to realize on the collateral, including performing
any part of a contract or endorsing it in my name; and (6) make an entry on my
books and records showing the existence of the security agreement. Your right to
perform for me shall not create an obligation to perform and your failure to
perform will not preclude you from exercising any of your other rights under the
law or this security agreement.

INSURANCE -- I agree to buy insurance on the property against the risks and for
the amounts you require and to furnish you continuing proof of coverage. I will
have the insurance company name you as loss payee on any such policy. You may
require added security if you agree that insurance proceeds may be used to
repair or replace the property. I will buy insurance from a firm licensed to do
business in the state where you are located. The firm will be reasonably
acceptable to you. The insurance will last until the property is released from
this agreement. If I fail to buy or maintain the insurance (or fail to name you
as loss payee) you may purchase it yourself.

WARRANTIES AND REPRESENTATIONS -- If this agreement includes accounts, I will
not settle any account for less than its full value without your written
permission. I will collect all accounts until you tell me otherwise. I will keep
the proceeds from all the accounts and any goods which are returned to me or
which I take back in trust for you. I will not mix them with any other property
of mine. I will deliver them to you at your request. If you ask me to pay you
the full price on any returned items or items retaken by myself, I will do so.

If this agreement covers inventory, I will not dispose of its except in my
ordinary course of business at the fair market value for the property, or at a
minimum price established between you and me.

If this agreement covers farm products I will provide you, at your request,
a written list of the buyers, commission merchants or selling agents to or
through whom I may sell my farm products. In addition to those parties named on
this written list, I authorize you to notify at your sole discretion any
additional parties regarding your security interest in my farm products. I
remain subject to all applicable penalties for selling my farm products in
violation of my agreement with you and the Food Security Act. In this paragraph
the terms farm products, buyers, commission merchants and selling agents have
the meanings given to them in the Federal Food Security Act of 1985.

DEFAULT -- I will be in default if any one or more of the following occur: (1) I
fail to make a payment on time or in the amount due; (2) I fail to keep the
property insured, if required; (3) I fail to pay, or keep any promise, on any
debt or agreement I have with you; (4) any other creditor of mine attempts to
collect any debt I owe him through court proceedings; (5) I die, am declared
incompetent, make an assignment for the benefit of creditors, or become
insolvent (either because my liabilities exceed my assets or I am unable to pay
my debts as they become due); (6) I make any written statement or provide any
financial information that is untrue or inaccurate at the time it was provided;
(7) I do or fail to do something which causes you to believe that you will have
difficulty collecting the amount I owe you; (8) I change my name or assume an
additional name without first notifying you before making such a change; (9)
failure to plant, cultivate and harvest crops in due season; (10) if any loan
proceeds are used for a purpose that will contribute to excessive erosion of
highly erodible land or to the conversion of wetlands to produce an agricultural
commodity, as further explained in 7 C.F.R. Part 1940, Subpart G, Exhibit M.
REMEDIES -- If I am in default on this agreement, you have the following
remedies:

1) You may demand immediate payment of all I owe you under any obligation
secured by this agreement.
2) You may set off any obligation I have to you against any right I have
to the payment of money from you.
3) You may demand more security or new parties obligated to pay any debt I
owe you as a condition of giving up any other remedy.
4) You may make use of any remedy you have under state or federal law.
5) If I default by failing to pay taxes or other charges, you may pay them
(but you are not required to do so). If you do, I will repay to you the
amount you paid plus interest at the highest contract rate.
6) You may require me to gather the property and make it available to you
in a reasonable fashion.
7) You may repossess the property and sell it as provided by law. You may
repossess the property so long as the repossession does not involve a
breach of the peace or an illegal entry onto my property. You may sell
the property as provided by law. You may apply what you receive from
the sale of the property to: your expenses; your reasonable attorney's
fees and legal expenses (where not prohibited by law); any debt I owe
you. If what you receive from the sale of the property does not satisfy
the debts, you may take me to court to recover the difference (where
permitted by law).
I agree that 10 days written notice sent to my address listed on page 1
by first class mail will be reasonable notice to me under the Uniform
Commercial Code.
If any items not otherwise subject to this agreement are contained in
the property when you take possession, you may hold these items for me
at my risk and you will not be liable for taking possession of them.

8) In some cases, you may keep the property to satisfy the debt. You may
enter upon and take possession of all or any part of my property, so
long as you do not breach the peace or illegally enter onto the
property, including lands, plants, buildings, machinery, and equipment
as may be necessary to permit you to manufacture, produce, process,
store or sell or complete the manufacture, production, processing,
storing or sale of any of the property and to use and operate the
property for the length of time you feel is necessary to protect your
interest, all without payment or compensation to me.

By choosing any one or more of these remedies, you do not waive your right
to later use any other remedy. You do not waive a default if you choose not to
use any remedy, and, by electing not to use any remedy, you do not waive your
right to later consider the event a default and to immediately use any remedies
if it continues or occurs again.

FILING -- A carbon, photographic or other reproduction of this security
agreement or the financing statement covering the property described in this
agreement may be used as a financing statement where allowed by law. Where
permitted by law, you may file a financing statement which does not contain my
signature, covering the property secured by this agreement.

CO-MAKERS -- If more than one of us has signed this agreement, we are all
obligated equally under the agreement. You may sue any one of us or any of us
together if this agreement is violated. You do not have to tell me if any term
of the agreement has not been carried out. You may release any co-signer and I
will still be obligated under this agreement. You may release any of the
security and I will still be obligated under this agreement. Waiver by you of
any of your rights will not affect my duties under this agreement. Extending
this agreement or new obligations under this agreement, will not affect my duty
under the agreement.

(page 2 of 2)

_________ STATE OF TEXAS _____________________________ SPACE ABOVE THIS LINE
FOR RECORDING DATA _____________________________________________________________

ABSOLUTE ASSIGNMENT OF LEASES AND RENTS

1. DATE AND PARTIES. The date of this Absolute Assignment of Leases and Rents
(Absolute Assignment) is May 2, 1998 and the parties, their addresses and
tax identification numbers, if required, are as follows:

ASSIGNOR: AMERICAN ENERGY SERVICES, INC.
CORPORATION
0000 XXXXXXXX
XXXXXXX, XX 00000
TAXPAYER I.D. #: 00-0000000

[ ] If checked, refer to the attached Addendum incorporated herein, for
additional Assignors, their signatures and acknowledgements.

TRUSTEE: XXXXXX X. XXXXXXX
TRUSTEE
0000 XXXXXXXX XXX 000
XXXXXXX, XX 00000
TAXPAYER I.D. #: 00-0000000

LENDER: METROBANK, N.A. GALLERIA BRANCH
ORGANIZED AND EXISTING UNDER THE LAWS
OF THE UNITED STATES OF AMERICA
0000 XXXXXXXXXX, XXX. #0000
XXXXXXX, XX 00000
TAXPAYER I.D. #: 00-0000000

2. ASSIGNMENT OF LEASES AND RENTS. To induce Lender to extend the Obligations
(hereafter defined) and for good and valuable consideration, including Ten
Dollars paid to Lender, the receipt and sufficiency of which is
acknowledged, Assignor absolutely, unconditionally, irrevocably and
immediately assigns, grants, sells and conveys to Trustee, in trust for the
benefit of Lender, all of Assignor's right, title and interest in and to any
and all of the following (collectively referred to as "Collateral"):

A. Existing or future leases, subleases, licenses, guaranties of
performance of any party thereunder and any other written or verbal
agreements for the use and occupancy of any portion of the Property
(hereafter defined), including any extensions, renewals, modifications
or substitutions of such agreements, including but not limited to the
following described Leases (Leases):

B. Rents, issues and profits (Rents), including without limitation,
security deposits, minimum rents, percentage rent, additional rent,
common area maintenance charges, parking charges, real estate taxes,
other applicable taxes, insurance premium contributions, liquidated
damages following default, cancellation premiums, "loss of rents"
insurance, guest receipts, revenues, royalties, proceeds, bonuses,
accounts, contract rights, general intangibles, and all rights and
claims which Assignor may have that in any way pertains to or is on
account of the use or occupancy of the whole or any part of the
Property.

This assignment is an absolute assignment and not an assignment for
additional security. In the event any item listed as Leases or Rents is
determined to be personal property, this Absolute Assignment will also be
regarded as a security agreement.

3. OBLIGATIONS DEFINED. The term "Obligations" is defined as follows:

A. Debt incurred under the terms of all promissory note(s), contract(s),
guaranty(s) or other evidence of debt described below and all their
extensions, renewals, modifications or substitutions (Evidence of Debt).
(WHEN REFERENCING THE DEBTS BELOW IT IS SUGGESTED THAT YOU INCLUDE ITEMS
SUCH AS THE BORROWERS' NAMES, NOTE AMOUNTS, INTEREST RATES, MATURITY
DATES, ETC.)

PROMISSORY NOTE #721099972 (EXIM BANK COMMITMENT #AP069603XB) IN THE
AMOUNT OF $2,000,000.00 FROM AMERICAN ENERGY SERVICES, INC. TO
METROBANK, N.A.; DATED 05-02-98 AT A CURRENT RATE OF PRIME PLUS .5%; TO
MATURE ON SEPTEMBER 2, 1998.

(page 1 of 6)

B. All future advances from Lender to Assignor or other future obligations
of Assignor to Lender under any promissory note, contract, guaranty or
other evidence of debt executed by Assignor in favor of lender executed
after this Absolute Assignment whether or not this Absolute Assignment
is specifically referenced. If more than one person signs the Absolute
Assignment, each Assignor agrees that this Absolute Assignment will
secure all future advances and future obligations that are given to or
incurred by any one or more Assignor, or any one or more Assignor and
others. All future advances and other future obligations are secured by
this Absolute Assignment even though all or part may not yet be
advanced. All future advances and other future obligations are secured
as if made on the date of this Absolute Assignment. Nothing in this
Absolute Assignment shall constitute a commitment to make additional or
future loans or advances in any amount. Any such commitment must be
agreed to in a separate writing.

C. All obligations Assignor owes to Lender, which may later arise, to the
extent not prohibited by law, including without limitation, liabilities
for overdrafts relating to any deposit account agreement between
Assignor and Lender.

D. All additional sums advanced and expenses incurred by Xxxxxx for
insuring, preserving or otherwise protecting the Collateral and its
value and any other sums advanced and expenses incurred by the Lender
under the terms of this Absolute Assignment.

X. Xxxxxxxx's performance under the terms of any instrument evidencing a
debt by Assignor to Lender and any security instrument securing,
guarantying or otherwise relating to the debt.

This Absolute Assignment will not secure any other debt if the Lender
fails to give any required notice of the right of recissions.

4. PAYMENTS. Assignor agrees that all payments under the Obligations will be
paid when due and in accordance with the terms of each Evidence of Debt and
this Absolute Assignment.

5. COLLECTION OF RENTS. Lender grants Assignor a revocable license to collect,
receive, enjoy and use the Rents so long as Assignor is not in default.
Assignor's default automatically and immediately revokes this license.
Except for one lease period's rent. Assignor will not collect in advance any
Rents due in future lease periods without Xxxxxx's prior written consent.
Assignor will receive any Rents in trust for Lender and Assignor will not
commingle the Rents with any other funds. When Lender so directs, Assignor
will endorse and deliver any payments of Rents from the Property to Lender.

Assignor agrees that Xxxxxx will not be considered to be a
mortgagee-in-possession by executing this Absolute Assignment or by
collecting or receiving payments on the obligations (hereafter defined), but
only may become a mortgagee-in-possession after Assignor's license to
collect, receive, enjoy and use the Rents is revoked by Lender or
automatically revoked on Assignor's default, and Lender actually takes
possession of the Property. Consequently, until Xxxxxx takes actual
possession of the Property, Lender is not obligated to perform or discharge
any obligation of Assignor under the Leases, appear in or defend any action
or proceeding relating to the Rents, the Leases or the Property, or be
liable in any way for any injury or damage to any person or property
sustained in or about the Property.

6. WARRANTIES AND COVENANTS. To induce Xxxxxx to extend credit by entering into
the Obligations, Assignor makes the following warranties and covenants:

X. Xxxxxxxx has good title to the Leases, Rents and Property and the right
to absolutely, unconditionally, irrevocably and immediately assign,
grant, convey and sell the Leases and Rents and no other person has any
right in the Leases and Rents.

B. Assignor has recorded the Leases as required by law or as otherwise
prudent for the type and use of the Property.

C. No default exists under the Leases, and the parties subject to the
Leases have not violated any applicable law on leases, licenses and
landlords and tenants. Assignor, at its sole cost and expense, will
keep, observe and perform, and require all other parties to the Leases
to comply with, the Leases and any applicable law. If Assignor or any
party to the Lease defaults or fails to observe any applicable law,
Assignor will promptly notify Lender of this noncompliance.

D. When any Lease provides for an abatement of Rents due to fire, flood or
other casualty, Assignor will insure against this risk of loss with a
policy satisfactory to Lender.

E. Assignor will promptly provide Lender with copies of the Leases and will
certify these Leases are true and correct copies. This existing Leases
will be provided on execution of the Absolute Assignment, and all future
Leases will be provided immediately after they are executed.

F. Immediately after execution of this Absolute Assignment, Assignor will
notify all current and future tenants and others obligated under the
Leases of Lender's right to the Leases and Rents, and will request that
they immediately pay all future Rents directly to Lender when Assignor
or Lender demand them to do so.

G. When Lender requests, Assignor will provide to Lender an accounting of
Rents, prepared in a form acceptable to Lender, subject to generally
accepted accounting principles in effect when such statements are made,
and certified by Assignor or Assignor's accountant to be current, true,
accurate and complete as of the date requested by Xxxxxx.

H. Assignor has not sublet, modified, extended, canceled, or otherwise
altered the Leases, or accepted the surrender of the Property covered by
the Leases (unless the Leases so required), nor will Assignor do so
without Xxxxxx's prior written consent.

I. Assignor has not assigned, compromised, subordinated or encumbered the
Leases and Rents, and will not do so without Xxxxxx's prior written
consent.

J. Assignor will not enter into any future Leases without prior written
consent from Xxxxxx and at Xxxxxx's request, Assignor will execute and
deliver such further assurances and assignments as to these future
Leases as Lender requires from time to time.

(page 2 of 6)

K. Assignor will not sell or remove any personal property on the Property,
unless Assignor replaces this personal property with like kind for the
same or better value.

L. Assignor will appear in and prosecute its claims or defend its title to
the Leases and Rents against any claims that would impair Assignor's
interest under this Absolute Assignment, and on Xxxxxx's request.
Assignor will also appear in any action or proceeding in the name and on
behalf of Xxxxxx. Assignor will pay Lender for all costs and expenses,
including reasonable attorneys' fees, incurred by Xxxxxx for appearing
in any action or proceeding related to the Leases or Rents. Assignor
agrees to assign to Lender, as requested by Xxxxxx, any rights, claims
or defenses which Assignor may have against parties who supply labor or
materials to improve or maintain the leaseholds subject to the Leases
and/or the Property.

M. If Lender acts to manage, protect and preserve the Property, Lender does
not assume or become liable for its maintenance, depreciation, or other
losses or damages, except those due to Lender's gross negligence or
intentional torts. Otherwise, Assignor will indemnify Lender and hold
Lender harmless for any and all liability, loss or damage that Lender
may incur as a result of this Absolute Assignment or any action taken to
manage, protect or preserve the Property or Xxxxxx's interest in the
Leases and Rents.

N. Assignor will not cause or permit the leasehold estate under the Leases
to merge with Assignor's reversionary interest, and agrees that the
Lease shall remain in full force and effect regardless of any merger of
the Assignor's interests and of any merger of the interests of Assignor
and of tenants and other parties obligated under the Lease.

X. Xxxxxx will be the crditor of each tenant and of anyone else obligated
under the Leases who is subject to any assignment for the benefit of
creditors, an insolvency, a dissolution or a receivership proceeding, or
a bankruptcy.

P. If Assignor become subject to a voluntary or involuntary bankruptcy,
then Assignor agrees that the Leases and Rents are "cash collateral" as
defined by the U.S. Bankruptcy Code, 11 U.S.C. ^ 363, as amended, and
Lender is entitled to receive relief from the automatic stay in
bankruptcy for the purpose of making this Absolute Assignment effective
and enforceable under state and federal law.

7. TRANSFER OF AN INTEREST IN THE ASSIGNOR. If Assignor is an entity other
than a natural person (such as a corporation or other organization), Lender
may demand immediate payment if:

A. A beneficial interest in Assignor is sold or transferred;

B. There is a change in either the identity or number of members of a
partnership or similar entity; or

C. There is a change in ownership of more than 25 percent of the voting
stock of a corporation or similar entity.

However, Lender may not demand payment in the above situations if it is
prohibited by law as of the date of this Absolute Assignment.

8. ENTITY WARRANTIES AND REPRESENTATIONS. If Assignor is an entity other than
a natural person (such as a corporation or other organization), Assignor
makes to Lender the following warranties and representations which shall be
continuing as long as the Obligations remain outstanding:

A. Assignor is an entity which is duly organized and validly existing in
the Assignor's state of incorporation or organization. Assignor is in
good standing in all states in which Assignor transacts business.
Assignor has the power and authority to own the Leases, the Rents and
the Property and to carry on its business as now being conducted and, as
applicable, is qualified to do so in each state in which Assignor
operates.

B. The execution, delivery and performance of this Absolute Assignment by
Assignor and the obligations evidenced by the Obligations are within the
power of Assignor, have been duly authorized, have received all
necessary governmental approval, and will not violate any provision of
law, or order of court or governmental agency.

C. Other than disclosed in writing to Lender, Assignor has not changed its
name within the last ten years and has not used any other trade or
fictitious name. Without Xxxxxx's prior written consent, Assignor does
not and will not use any other name and will preserve its existing name,
trade names and franchises until the Obligations are satisfied.

9. DEFAULT. Assignor will be in default if any of the following occur:

A. Any party obligated on the Obligations fails to make payment when due;

B. A breach of any term or covenant in this Absolute Assignment or any
other document executed for the purpose of creating, securing or
guarantying the Obligations;

C. The making or furnishing of any verbal or written representation,
statement or warranty to Lender that is false or incorrect in any
material respect by Assignor or any person or entity obligated on the
Obligations;

D. The death, dissolution, appointment of a receiver for, or application of
any debtor relief law to, Assignor or any person or entity obligated on
the Obligations;

E. A good faith belief by Xxxxxx at any time that Xxxxxx is insecure with
respect to any person or entity obligated on the Obligations or that the
prospect of any payment is impaired or the Collateral is impaired;

F. A material adverse change in Assignor's business including ownership,
management, and financial conditions, which Lender in its opinion
believes impairs the value of the Collateral or repayment of the
Obligations; or

G. Any loan proceeds are used for a purpose that will contribute to
excessive erosion of highly erodible land or to the conversion of
wetlands to produce an agricultural commodity, as further explained in 7
C.F.R. Part 1940, Subpart G, Exhibit M.

10. REMEDIES ON DEFAULT. Subject to any notice and right to cure, mediation or
other such rights and limitations, Lender may accelerate the Obligations
and enforce this Absolute Assignment in a manner provided by law if
Assignor is in default. At the option of the Lender, all or any part of the
agreed fees and charges and the Obligations shall become immediately due
and payable, after giving notice if required by law, upon the occurrence of
a default or anytime thereafter.

(page 3 of 6)

On or after Assignor's default and to the extent not prohibited or limited
by law, Lender may, without regard to the adequacy of the security for the
Obligations, without bond, with or without bringing any action or
proceeding, in person or by an agent, or by a receiver (who may be Xxxxxx's
officer or employee) or other person appointed by a court: enter upon, take
possession of, and manage and operate the Property; make, modify, enforce,
cancel or accept the surrender of any Leases; obtain and evict tenants,
operators, concessionaires, and licensees; fix or modify Rents; and
terminate Assignor's right to collect Rent, and thereafter either with or
without taking possession of the Property, in its own name, sue for or
otherwise collect and receive all Rents, including those past due and
unpaid, and after giving proper receipts and releases, apply the Rents in
the order as required by law and otherwise as Lender determines, to the
costs and expenses of operation and collection, including reasonable
attorneys' fees, and to the Obligations due under this Absolute Assignment;
and do any acts or incur any costs which Lender deems proper to protect
Xxxxxx's interest under this Absolute Assignment until the Obligations are
paid in full. The enforcement of Xxxxxx's remedies to collect and receive
Rents, once exercised, shall continue for so long as Lender shall elect,
notwithstanding that such collection and application of Rents may have cured
the original default.

In addition, Xxxxxx shall be entitled to all remedies provided at law and
the terms of the Obligations, this Absolute Assignment and any related
documents. All remedies are distinct, cumulative and not exclusive, and the
Lender is entitled to all remedies provided at law or in equity, whether or
not expressly set forth. The acceptance by Lender of any sum in payment or
partial payment on the Obligations after the balance is due or is
accelerated or after enforcement actions or proceedings are filed shall not
constitute a waiver of Lender's right to require complete cure of any
existing default. By not exercising any remedy on Assignors' default, Xxxxxx
does not waive Lender's right to later consider the event a default if it
continues or happens again.

11. EXPENSES; ADVANCES ON COVENANTS; ATTORNEYS' FEES; COLLECTION COSTS. Except
when prohibited by law, Xxxxxxxx agrees to pay all of Xxxxxx's expenses if
Assignor breaches any covenant in this Absolute Assignment. Assignor will
also pay on demand all of Xxxxxx's expenses incurred in collecting,
insuring, preserving or protecting the Collateral and Xxxxxx's assignment
interest or in any audits, inspections or other examination by Lender with
respect to the Collateral. These expenses will bear interest from the date
of the payment until paid in full at the highest interest rate in effect as
provided in the terms of the Obligations, shall become part of the
Obligations and shall be SECURED BY THIS ABSOLUTE ASSIGNMENT. Assignor
agrees to pay all costs and expenses incurred by Xxxxxx in collecting,
enforcing or protecting Xxxxxx's rights and remedies under this Absolute
Assignment. This amount may include without limitation attorneys' fees,
court costs and other legal expenses. This Absolute Assignment shall remain
in effect until released. Assignor agrees to pay for any recordation costs
of such release.

12. ENVIRONMENTAL LAWS AND HAZARDOUS SUBSTANCES. As used in this section, (1)
"Environmental Law" means, without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act (CERCLA, 42 U.S.C.
9601 et seq.), all other federal, state and local laws, regulations,
ordinances, court orders, attorney general opinions or interpretive letters
concerning the public health, safety, welfare, environment or hazardous
substance; and (2) "Hazardous Substance" means any toxic, radioactive or
hazardous material, waste, pollutant or contaminant which has
characteristics which render the substance dangerous or potentially
dangerous to the public health, safety, welfare or environment. The term
includes, without limitation, any substances defined as "hazardous
material", "toxic substances", "hazardous waste" or "hazardous
substance" under any Environmental Law.

Assignor represents, warrants and agrees that:

A. Except as previously disclosed and acknowledged in writing, no Hazardous
Substance has been, is or will be located, transported, manufactured,
treated, refined, or handled by any person on, under or about the
Property, except in the ordinary course of business and in strict
compliance with all applicable Environmental Law.

B. Except as previously disclosed and acknowledged in writing, Assignor has
not and will not cause, contribute to, or permit the release of any
Hazardous Substance on the Property.

C. Assignor will immediately notify Lender if (1) a release or threatened
release of Hazardous Substance occurs on, under or about the Property or
migrates or threatens to migrate from nearby property; or (2) there is a
violation of any Environmental Law concerning the Property. In such an
event, Assignor will take all necessary remedial action in accordance
with Environmental Law.

D. Except as previously disclosed and acknowledged in writing, Assignor has
no knowledge or reason to believe there is any pending or threatened
investigation, claim, or proceeding of any kind relating to (1) any
Hazardous Substance located on, under or about the Property; or (2) any
violation by Assignor or any tenant of any Environmental Law. Assignor
will immediately notify Xxxxxx in writing as soon as Assignor has reason
to believe there is any such pending or threatened investigation, claim
or proceeding. In any event, Xxxxxx has the right, but not the
obligation, to participate in any such proceeding including the right to
receive copies of any documents relating to such proceedings.

E. Except as previously disclosed and acknowledged in writing, Assignor and
every tenant under the Leases have been, are and shall remain in full
compliance with any applicable Environmental Law.

F. Except as previously disclosed and acknowledged in writing, there are no
underground storage tanks, private dumps or open xxxxx located on or
under the Property and no such tank, dump or well will be added unless
Lender first consents in writing.

G. Assignor will regularly inspect the Property, monitor the activities and
operations on the Property, and confirm that all permits, licenses or
approvals required by any applicable Environmental Law are obtained and
complied with.

H. Assignor will permit, or cause any tenant to permit, Lender or Xxxxxx's
agent to enter and inspect the Property and review all records at any
reasonable time to determine (1) the existence, location and nature of
any Hazardous Substance on, under or about the Property; (2) the
existence, location, nature, and magnitude of any Hazardous Substance
that has been released on, under or about the Property; or (3) whether
or not Assignor and any tenant are in compliance with applicable
Environmental Law.

(page 4 of 6)

I. Under Xxxxxx's request and at any time, Xxxxxxxx agrees, at Xxxxxxxx's
expense, to engage a qualified environmental engineer to prepare an
environmental audit of the Property and to submit the results of such
audit to Lender. The choice of the environmental engineer who will
perform such audit is subject to Xxxxxx's approval.

X. Xxxxxx has the right, but not the obligation, to perform any of
Assignor's obligations under this section at Assignor's expense.

K. As a consequence of any breach of any representation, warranty or
promise made in this section, (1) Assignor will indemnify and hold
Lender and Xxxxxx's successors or assigns harmless from and against all
losses, claims, demands, liabilities, damages, cleanup, response and
remediation costs, penalties and expenses, including without limitation
all costs of litigation and attorneys' fees, which Lender and Xxxxxx's
successors or assigns may sustain; and (2) at Lender's discretion,
Xxxxxx may release this Absolute Assignment and in return Assignor will
provide Lender with collateral of at least equal value to the Collateral
assigned by this Absolute Assignment without prejudice to any of
Lender's rights under this Absolute Assignment.

L. Notwithstanding any of the language contained in this Absolute
Assignment to the contrary, the terms of this section shall survive any
satisfaction of this Absolute Assignment regardless of any passage of
title to Lender or any disposition by Lender of any or all of the
Collateral or Property. Any claims and defenses to the contrary are
hereby waived.

13. APPOINTMENT OF A RECEIVER. On or after an Assignor's default, Xxxxxxxx
agrees and consents to Xxxxxx applying to the court -- without notice to or
challenge by Assignor -- for an appointment of a receiver for the benefit of
Xxxxxx. Xxxxxxxx also agrees that the appointed receiver can take possession
of the Property and the Leases, and can receive, collect and apply the
Rents. Any Rents so collected shall be applied as the court authorizes to
pay taxes, to provide insurance, to make repairs and to pay costs of any
other expenses relating to the Property, the Leases and the Rents, and any
remaining sums shall be applied to the Obligations. Assignor agrees that
this appointment of a receiver may be without notice to Assignor, without
giving bond, without reference to the then-existing value of the Property,
and without regard to the insolvency of any person liable for any of the
Obligations.

14. FINANCIAL INFORMATION AND ADDITIONAL DOCUMENTS. Assignor will provide to
Lender on request, any financial statement or information Lender deems
necessary. Assignor agrees to sign, deliver, and file any additional
documents or certifications that Lender may consider necessary to perfect,
make effective, continue, and preserve Assignor's obligations and Xxxxxx's
interest under the Absolute Assignment.

15. JOINT AND INDIVIDUAL LIABILITY; CO-SIGNERS, SUCCESSORS AND ASSIGNS BOUND.
All duties under this Absolute Assignment are joint and individual. If
Assignor signs this Absolute Assignment, but does not sign any Evidence of
Debt, Assignor does so only to assign Assignor's interest in the Collateral
for the payment of the Obligations and Assignor does not agree to be
personally liable on the Obligations. If this Absolute Assignment provides
Collateral for a guaranty between Lender and Assignor and does not directly
secure the obligation which is guarantied, Assignor agrees to waive any
rights that may prevent Lender from bringing any action or claim against
Assignor or any party indebted under the obligation. These rights may
include without limitation any anti-deficiency or one-action laws. Assignor
agrees that Xxxxxx and any party to this Absolute Assignment may extend,
modify and make any change in the terms of this Absolute Assignment or any
Evidence of Debt without Assignor's consent. Such a change will not release
Assignor from the terms of this Absolute Assignment. The duties and benefits
of this Absolute Assignment shall bind and benefit the successors and
assigns of Assignor and Lender.

16. APPLICABLE LAW; SEVERABILITY; INTERPRETATION. This Absolute Assignment is
governed by the laws of the jurisdiction in which Lender is located, except
to the extent otherwise required by the laws of the jurisdiction where the
Property is located. This Absolute Assignment is complete and fully
integrated. This Absolute Assignment may not be amended or modified by oral
agreement. Any section in this Absolute Assignment, attachments, or any
agreement related to the Obligations that conflicts with applicable law will
not be effective, unless that law expressly or impliedly permits the
variations by written agreement. If any section of this Absolute Assignment
cannot be enforced according to its terms, that section will be severed and
will not affect the enforceability of the remainder of this Absolute
Assignment. Whenever used, the singular shall include the plural and the
plural the singular. The captions and headings of the sections of this
Absolute Assignment are for convenience only and are not to be used to
interpret or define the terms of this Absolute Assignment. Time is of the
essence in this Absolute Assignment.

17. NOTICE. Unless otherwise required by law, any notice shall be given by
delivering it or by mailing it by first class mail, to the appropriate
party's address on page 1 of this Absolute Assignment, or to any other
address designated in writing. Notice to one assignor will be deemed to be
notice to all assignors.

18. WAIVER. Except to the extent prohibited by law, Assignor waives all rights
relating to appraisement relating to the Collateral.

19. TERM. This Absolute Agreement shall remain in full force and effect until
all of the Obligations are paid or otherwise discharged and Lender is no
longer obligated to advance funds under any loan or credit agreement which
is a part of the Obligations. If any or all payments of the Obligations are
subsequently invalidated, declared void or voidable, or set aside and are
required to be repaid to a trustee, custodian, receiver or any other party
under any bankruptcy act or other state or federal law, then the Obligations
will be revived and will continue in full force and effect as if this
payment had not been made.

20. USUARY SAVINGS. In no event shall any provision of this Absolute Assignment
or any other instrument evidencing or securing the Obligations ever obligate
Assignor to pay or allow Lender to collect interest on the Obligations at a
rate greater than the maximum non-usurious rate permitted by applicable law.

(page 5 of 6)

21. REAL ESTATE PROPERTY. The term "Property" as used in this Absolute
Assignment shall include the following described real property:

REFER TO EXHIBIT "A" WHICH IS ATTACHED HERETO AND MADE A PART HEREOF.

The Property is located in (County): XXXXXX at (Address): 0000 XXXXXXXX,
(Xxxx): HOUSTON, TEXAS, (Zip Code): 77539

22. ADDITIONAL TERMS.

SIGNATURES: By signing below, Xxxxxxxx agrees to the terms and covenants
contained in this Absolute Assignment and in any attachments. Assignor also
acknowledges receipt of a copy of this Absolute Assignment on the date
stated above on page 1.

---------------------------------------------------------

THIS WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OR PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE
NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

The parties' signatures below indicate agreement with the statements
contained within this box.

---------------------------------------------------------

Entity Name: AMERICAN ENERGY SERVICES, INC., Entity Name: ------------------------------------------------
CORPORATION
BY: /s/ XXX X. XXXXXXX ------------------------------------------------
(Signature) (Date) (Signature) (Date)
Name: --------------------------
Title: ------------------------
BY: ------------------------------------------------ ------------------------------------------------
(Signature) (Date) (Signature) (Date)
Name: ------------------------
Title: ------------------------

ACKNOWLEDGEMENT:

STATE OF
------------------, COUNTY OF
------------------ } ss.
This instrument was acknowledged before me this
--------- day of
---------------
by
------------------------------------------------------------------------
My commission expires:
(Seal)

---------------------------------------
(Notary Public)

(Business or Entity Acknowledgment)

STATE OF TEXAS, COUNTY OF XXXXXX} ss.
This instrument was acknowledged before me this 2nd day of May, 1998
by NAME:
------------------ TITLE:
------------------
NAME:
------------------; TITLE:
------------------(Title(s))
of AMERICAN ENERGY SERVICES, INC. (Name of Business or Entity)
a CORPORATION on behalf of the business or entity.
My commission expires
(Seal)

---------------------------------------
(Notary Public)

(page 6 of 6)

_________ STATE OF TEXAS _____________________________ SPACE ABOVE THIS LINE
FOR RECORDING DATA _____________________________________________________________

REAL ESTATE DEED OF TRUST
(WITH FUTURE ADVANCE CLAUSE)

1. DATE AND PARTIES. The date of this Deed of Trust (Security Instrument) is
May 2, 1998 and the parties, their addresses and tax identification numbers,
if required, are as follows:

GRANTOR: AMERICAN ENERGY SERVICES, INC.
CORPORATION
0000 XXXXXXXX
XXXXXXX, XX 00000
TAXPAYER I.D. #: 00-0000000

[ ] If checked, refer to the attached Addendum incorporated herein, for
additional Grantors, their signatures and acknowledgements.

TRUSTEE: XXXXXX X. XXXXXXX
TRUSTEE
0000 XXXXXXXX XXX 000
XXXXXXX, XX 00000
TAXPAYER I.D. #: 00-0000000

LENDER: METROBANK, N.A. GALLERIA BRANCH
ORGANIZED AND EXISTING UNDER THE LAWS
OF THE UNITED STATES OF AMERICA
0000 XXXXXXXXXX, XXX. #0000
XXXXXXX, XX 00000
TAXPAYER I.D. #: 00-0000000

2. CONVEYANCE. In consideration of Ten Dollars paid in hand, and for the
purpose of securing the Secured Debt (defined below) and Grantor's performance
under this Security Instrument, Grantor irrevocably grants, sells, and conveys
unto Trustee, in trust for the benefit of Xxxxxx, with power of sale, the
following described property:

REFER TO EXHIBIT "A' WHICH IS ATTACHED HERETO AND MADE A PART HEREOF

The property is located in Xxxxxx County at 0000 Xxxxxxxx, Xxxxxxx, Xxxxx 00000.

Together with all rights, easements, appurtenances, royalties, mineral rights,
oil and gas rights, crops, timber, all diversion payments or third party
payments made to crop producers, all water and riparian rights, xxxxx, ditches,
reservoirs, and water stock and all existing and future improvements,
structures, fixtures, and replacements that may now, or at any time in the
future, be part of the real estate described above (all referred to as
"Property").

3. SECURED DEBT AND FUTURE ADVANCES. The term "Secured Debt" is defined as
follows:

(page 1 of 6)

B. All future advances from Lender to Grantor or other future obligations
of Grantor to Lender under any promissory note, contract, guaranty, or
other evidence of debt existing now of executed after this Security
Instrument whether or not this Security Instrument is specifically
referenced. If more than one person signs this Security Instrument, each
Grantor agrees that this Security Instrument will secure all future
advances and future obligations that are given to or incurred by any one
or more Grantor, or any one or more Grantor and others. All future
advances and other future obligations are secured by this Security
Instrument even though all or part may not yet be advanced. All future
advances and other future obligations are secured as if made on the date
of this Security Instrument. Nothing in this Security Instrument shall
constitute a commitment to make additional or future loans or advances
in any amount. Any such commitment must be agreed to in a separate
writing.

C. All obligations Grantor owes to Lender, which now exist or may later
arise, to the extent not prohibited by law, including, but not limited
to, liabilities for overdrafts relating to any deposit account agreement
between Grantor and Lender.

D. All additional sums advanced and expenses incurred by Xxxxxx for
insuring, preserving or otherwise protecting the Property and its value
and any other sums advanced and expenses incurred by Lender under the
terms of this Security Instrument.

This Security Instrument will not secure any other debt if Xxxxxx fails to
give any required notice of the right of rescission.

4. PAYMENTS. Xxxxxxx agrees that all payments under the Secured Debt will be
paid when due and in accordance with the terms of the Secured Debt and this
Security Instrument.

5. WARRANTY OF TITLE. Grantor warrants that Grantor is or will be lawfully
seized of the estate conveyed by this Security Instrument and has the right
to irrevocably grant, convey and sell the Property to Trustee, in trust,
with power of sale. Grantor also warrants that the Property is unencumbered,
except for encumbrances of record.

6. PRIOR SECURITY INTERESTS. With regard to any other mortgage, deed of trust,
security agreement or other lien document that created a prior security
interest or encumbrance on the Property, Xxxxxxx agrees:

A. To make all payments when due and to perform or comply with all
covenants.

B. To promptly deliver to Lender any notices that Grantor receives from the
holder.

C. Not to allow any modification or extension of, nor to request any future
advances under any note or agreement secured by the lien document
without Xxxxxx's prior written consent.

7. CLAIMS AGAINST TITLE. Grantor will pay all taxes, assessments, liens,
encumbrances, lease payments, ground rents, utilities, and other charges
relating to the Property when due. Lender may require Grantor to provide to
Lender copies of all notices that such amounts are due and the receipts
evidencing Grantor's payment. Xxxxxxx will defend title to the Property
against any claims that would impair the lien of this Security Instrument.
Xxxxxxx agrees to assign to Lender as requested by Xxxxxx, any rights,
claims or defenses Grantor may have against parties who supply labor or
materials to maintain or improve the Property.

8. DUE ON SALE OR ENCUMBRANCE. Lender may, at its option, declare the entire
balance of the Secured Debt to be immediately due and payable upon the
creation of, or contract for the creation of, any lien, encumbrance,
transfer or sale of the Property. This right is subject to the restrictions
imposed by federal law (12 C.F.R. 591), as applicable. This covenant shall
run with the Property and shall remain in effect until the Secured Debt is
paid in full and this Security Instrument is released.

9. TRANSFER OF AN INTEREST IN THE GRANTOR. If Grantor is an entity other than a
natural person (such as a corporation or other organization), Lender may
demand immediate payment if:

A. A beneficial interest in Grantor is sold or transferred.

B. There is a change in either the identity or number of members of a
partnership or similar entity.

C. There is a change in ownership of more than 25 percent of the voting
stock of a corporation or similar entity.

However, Lender may not demand payment in the above situations if it is
prohibited by law as of the date of this Security Instrument.

10. ENTITY WARRANTIES AND REPRESENTATIONS. If Grantor is an entity other than a
natural person (such as a corporation or other organization), Grantor makes
to Lender the following warranties and representations which shall continue
as long as the Secured Debt remains outstanding.

A. Grantor is duly organized and validly existing in the Grantor's state of
incorporation or organization. Grantor is in good standing in all states
in which Grantor transacts business. Grantor has the power and authority
to own the Property and to carry on its business as now being conducted
and, as applicable, is qualified to do so in each state in which Grantor
operates.

B. The execution, delivery and performance of this Security Instrument by
Grantor and the obligation evidenced by the Secured Debt are within the
power of Grantor, have been duly authorized, have received all necessary
governmental approval, and will not violate any provision of law, or
order of court or governmental agency.

C. Other than previously disclosed in writing to Lender, Grantor has not
changed its name within the last ten years and has not used any other
trade or fictitious name. Without Xxxxxx's prior written consent,
Grantor does not and will not use any other name and will preserve its
existing name, trade names and franchises until the Secured Debt is
satisfied.

11. PROPERTY CONDITION, ALTERATIONS AND INSPECTION. Grantor will keep the
Property in good condition and make all repairs that are reasonably
necessary. Grantor shall not commit or allow any waste, impairment, or
deterioration of the Property. Grantor will keep the Property free of
noxious weeds and grasses. Xxxxxxx agrees that the nature of the occupancy
and use will not substantially change without Xxxxxx's prior written
consent. Grantor will not permit any change in any license, restrictive
covenant or easement without Xxxxxx's prior written consent. Grantor will
notify Lender of all demands, proceedings, claims, and actions against
Xxxxxxx, and of any loss or damage to the Property.

No portion of the Property will be removed, demolished or materially altered
without Xxxxxx's prior written consent except that Grantor has the right to
remove items of personal property comprising a part of the Property that
become worn or obsolete, provided that such personal property is replaced
with other personal property at least equal in value to the replaced
personal property, free from any title retention device, security agreement
or other encumbrance. Such replacement of personal property will be deemed
subject to the security interest created by this Security Instrument.
Grantor shall not partition or subdivide the Property without Xxxxxx's
written consent.

Lender or Xxxxxx's agents may, at Xxxxxx's option, enter the Property at any
reasonable time for the purpose of inspecting the Property. Lender shall
give Grantor notice at the time of or before an inspection specifying a
reasonable purpose for the inspection. Any inspection of the Property shall
be entirely for Xxxxxx's benefit and Grantor will no way rely on Xxxxxx's
inspection.

(page 2 of 6)

12. AUTHORITY TO PERFORM. If Grantor fails to perform any duty or any of the
covenants contained in this Security Instrument, Lender may, without notice,
perform or cause them to be performed. Grantor appoints Xxxxxx as attorney
in fact to sign Xxxxxxx's name or pay any amount necessary for performance.
Xxxxxx's right to perform for Grantor shall not create an obligation to
perform, and Xxxxxx's failure to perform will not preclude Lender from
exercising any of Xxxxxx's other rights under the law or this Security
Instrument. If any construction on the Property is discontinued or not
carried on in a reasonable manner, Lender may take all steps necessary to
protect Xxxxxx's security interest in the Property, including completion of
the construction.

13. ASSIGNMENT OF LEASES AND RENTS. Grantor irrevocably grants, conveys and
sells to Trustee, in trust for the benefit of the Lender, as additional
security all the right, title and interest in and to any and all:

A. Existing or future leases, subleases, licenses, guaranties and any other
written or verbal agreements for the use and occupancy of any portion of
the Property, including any extensions, renewals, modifications or
substitutions of such agreements (all referred to as "Leases").

B. Rents, issues and profits (all referred to as "Rents"), including but
not limited to security deposits, minimum rent, percentage rent,
additional rent, common area maintenance charges, parking charges, real
estate taxes, other applicable taxes, insurance premium contributions,
liquidated damages following default, cancellation premiums, "loss of
rents" insurance, guest receipts, revenues, royalties, proceeds,
bonuses, accounts, contract rights, general intangibles, and all rights
and claims which Grantor may have that in any way pertain to or are on
account of the use or occupancy of the whole or any part of the
Property.

In the event any item listed as Leases or Rents is determined to be personal
property, this Security Instrument will also be regarded as a security
agreement.

Grantor will promptly provide Lender with true and correct copies of all
existing and future Leases. Grantor may collect, receive, enjoy and use the
Rents so long as Grantor is not in default. Except for one lease period's
rent, Grantor will not collect in advance any future Rents without Xxxxxx's
prior written consent. Upon default, Grantor will receive Rents in trust for
Xxxxxx and Grantor will not commingle the Rents with any other funds.
Amounts collected shall be applied at Xxxxxx's discretion to payments on the
Secured Debt as therein provided, to costs of managing, protecting and
preserving the Property and to any other necessary related expenses
including Xxxxxx's attorneys' fees and court costs.

Grantor agrees that this assignment is immediately effective between the
parties to this Security Instrument and effective as to third parties on
Grantor's default when Lender or Trustee takes an affirmative action as
prescribed by the law of the state where the Property is located. This
assignment will remain effective until the Secured Debt is satisfied. Unless
otherwise provided by state law, Xxxxxxx agrees that Lender or Trustee may
take actual possession of the Property without commencing any legal action
or proceeding. Actual possession of the Property is deemed to occur when
Xxxxxx notifies Grantor of Grantor's default and demands that Grantor and
Xxxxxxx's tenants pay all Rents due or to become due directly to Lender.
Thereafter, either Lender or Grantor may notify the tenants and demand that
all future Rents be paid directly to Lender. On receiving the notice of
default, Grantor will endorse and deliver to Lender any payments of Rents.
If Grantor becomes subject to a voluntary or involuntary bankruptcy. Grantor
agrees that Xxxxxx and Trustee are entitled to receive relief from the
automatic stay in bankruptcy for the purpose of making this assignment
effective and enforceable under state and federal law.

Grantor warrants that no default exists under the Leases or any applicable
landlord law. Xxxxxxx also agrees to maintain, and to require the tenants to
comply with, the Leases and any applicable law. Grantor will promptly notify
Lender of any noncompliance. If Grantor neglects or refuses to enforce
compliance with the terms of the Leases, then Lender or Trustee may opt to
enforce compliance. Grantor will obtain Xxxxxx's written authorization
before Grantor consents to sublet, modify, cancel, or otherwise alter the
Leases, to accept the surrender of the Property covered by such Leases
(unless the Leases so require), or to assign, compromise or encumber the
Leases or any future Rents. If Lender acts to manage, protect and preserve
the Property, Lender does not assume or become liable for its maintenance,
depreciation, or other losses or damages, except those due to Lender's gross
negligence or intentional torts. Otherwise, Grantor will hold Lender
harmless and indemnify Lender for any and all liability, loss or damage that
Lender may incur as a consequence of the assignment under this section.

14. LEASEHOLDS; CONDOMINIUMS; PLANNED UNIT DEVELOPMENTS. Xxxxxxx agrees to
comply with the provisions of any lease if this Security Instrument is on a
leasehold. If the Property includes a unit in a condominium or a planned
unit development, Grantor will perform all of Grantor's duties under the
covenants, by-laws, or regulations of the condominium or planned unit
development.

15. DEFAULT. Grantor will be in default if any of the following occur:

A. Any party obligated on the Secured Debt fails to make payment when due;

B. A breach of any term or covenant in this Security Instrument or any
other document executed for the purpose of creating, securing or
guarantying the Secured Debt;

C. The making or furnishing of any verbal or written representation,
statement or warranty to Lender that is false or incorrect in any
material respect by Grantor or any person or entity obligated on the
Secured Debt;

D. The death, dissolution, or insolvency of, appointment of a receiver for,
or application of any debtor relief law to, Grantor or any other person
or entity obligated on the Secured Debt;

E. A good faith belief by Xxxxxx at any time that Lender is insecure with
respect to any person or entity obligated on the Secured Debt or that
the prospect of any payment is impaired or the value of the Property is
impaired;

F. A material adverse change in Grantor's business including ownership,
management, and financial conditions, which Lender in its opinion
believes impairs the value of the Property or repayment of the Secured
Debt; or

16. REMEDIES ON DEFAULT. In some instances, federal and state law will require
Lender to provide Grantor with notice of the right to cure, or other notices
and may establish time schedules for foreclosure actions. Subject to these
limitations, if any, Lender may accelerate the Secured Debt and foreclose
this Security Instrument in a manner provided by law if Grantor is in
default.

At the option of Lender, all or any part of the agreed fees and charges,
accrued interest and principal shall become immediately due and payable,
after giving notice if required by law, upon the occurrence of a default or
anytime thereafter. In addition, Xxxxxx shall be entitled to all the
remedies provided by law, the terms of the Secured Debt, this Security
Instrument and any related documents, including without limitation, the
power to sell the property.

In the event of default, it shall be the duty of the Trustee, at the request
of Lender (which request is hereby conclusively presumed), to invoke power
of sale as required by Section 51.002 of the Texas Property Code, as then
amended. Trustee shall advertise and sell the Property as a whole or in
separate parcels at public auction to the highest bidder for cash and convey
indefeasible title to the Property with covenants of general warranty.
Trustee shall give notice of sale including the

(page 3 of 6)

time, terms and place of sale and a description of the Property to be sold
as required by the applicable law in effect at the time of the proposed
sale.

Upon sale of the Property and to the extent not prohibited by law, Trustee
shall make and deliver a deed to the Property sold which conveys absolute
title to the purchaser, and after first paying all fees, charges and costs,
shall pay to Lender all monies advanced for repairs, taxes, insurance,
liens, assessments and prior encumbrances and interest thereon, and the
principal and interest on the Secured Debt, paying the surplus, if any, to
Grantor. Lender may purchase the Property. The recitals in any deed of
conveyance shall be prima facie evidence of the facts set forth therein.

All remedies are distinct, cumulative and not exclusive, and the Lender is
entitled to all remedies provided at law or equity, whether or not expressly
set forth. The acceptance by Lender of any sum in payment or partial payment
on the Secured Debt after the balance is due or is accelerated or after
foreclosure proceedings are filed shall not constitute a waiver of Lender's
rights to require full and complete cure of any existing default. By not
exercising any remedy on Grantor's default, Xxxxxx does not waive Xxxxxx's
right to later consider the event a default if it continues or happens
again.

17. FORECLOSURE. In the event a foreclosure under power of sale should be
commenced by the Trustee, Lender may at any time before the sale of the
Property direct the Trustee to abandon the sale, and may then institute suit
for the collection of the Secured Debt and for the foreclosure of the lien
of this Security Instrument. It is further agreed that if Xxxxxx should
institute a suit for the collection of the Secured Debt, and for a
foreclosure of the lien of this Security Instrument, that Lender may at any
time before the entry of a final judgment in said suit dismiss the same, and
require the Trustee to sell the Property in accordance with the provisions
of this Security Instrument. Lender, if it is the highest bidder, shall have
the right to purchase at any sale of the Property, and to have the amount
for which such Property is sold credited on the Secured Debt.

18. EXPENSES; ADVANCES ON COVENANTS; ATTORNEYS' FEES; COLLECTION COSTS. Except
when prohibited by law, Xxxxxxx agrees to pay all of Xxxxxx's expenses if
Grantor breaches any covenant in this Security Instrument. Grantor will also
pay on demand any amount incurred by Xxxxxx for insuring, inspecting,
preserving or otherwise protecting the Property and Xxxxxx's security
interest. These expenses will bear interest from the date of the payment
until paid in full at the highest interest rate in effect as provided in the
terms of the Secured Debt. Grantor agrees to pay all costs and expenses
incurred by Xxxxxx in collecting, enforcing or protecting Xxxxxx's rights
and remedies under this Security Instrument. This amount may include, but is
not limited to, attorneys' fees, court costs, and other legal expenses. This
Security Instrument shall remain in effect until released. Xxxxxxx agrees to
pay for any recordation costs of such release.

19. ENVIRONMENTAL LAWS AND HAZARDOUS SUBSTANCES. As used in this section, (1)
Environmental Law means, without limitation, the Comprehensive Environmental
Response, Compensation and Liability Act (CERCLA, 42 U.S.C. 9601 et seq.),
all other federal, state and local laws, regulations, ordinances, court
orders, attorney general opinions or interpretive letters concerning the
public health, safety, welfare, environment or a hazardous substance; and
(2) Hazardous Substance means any toxic, radioactive or hazardous material,
waste, pollutant or contaminant which has characteristics which render the
substance dangerous or potentially dangerous to the public health, safety,
welfare or environment. The term includes, without limitation, any
substances defined as "hazardous material," "toxic substances," "hazardous
waste" or "hazardous substance" under any Environmental Law.

Grantor represents, warrants and agrees that:

A. Except as previous disclosed and acknowledged in writing to Lender, no
Hazardous Substance has been, is, or will be located, transported,
manufactured, treated, refined, or handled by any person on, under or
about the Property, except in the ordinary course of business and in
strict compliance with all applicable Environmental Law.

B. Except as previously disclosed and acknowledged in writing to Lender,
Grantor has not and will not cause, contribute to, or permit the release
of any Hazardous Substance on the Property.

C. Grantor will immediately notify Lender if (1) a release or threatened
release of Hazardous Substance occurs on, under or about the Property or
migrates or threatens to migrate from nearby property; or (2) there is a
violation of any Environmental Law concerning the Property. In such an
event, grantor will take all necessary remedial action in accordance
with Environmental Law.

X. Xxxxxx as previously disclosed and acknowledged in writing to Lender,
Grantor has no knowledge of or reason to believe there is any pending or
threatened investigation, claim, or proceeding of any kind relating to
(1) any Hazardous Substance located on, under or about the Property; or
(2) any violation by Grantor or any tenant of any Environmental Law.
Grantor will immediately notify Xxxxxx in writing as soon as Grantor has
reason to believe there is any such pending or threatened investigation,
claim, or proceeding. In such an event, Xxxxxx has the right, but not
the obligation, to participate in any such proceeding including the
right to receive copies of any documents relating to such proceedings.

E. Except as previously disclosed and acknowledged in writing to Lender,
Grantor and every tenant have been, are and shall remain in full
compliance with any applicable Environmental Law.

F. Except as previously disclosed and acknowledged in writing to Lender,
there are no underground storage tanks, private dumps or open xxxxx
located on or under the Property and no such tank, dump or well will be
added unless Lender first consents in writing.

G. Grantor will regularly inspect the Property, monitor the activities and
operations on the Property, and confirm that all permits, licenses or
approvals required by any applicable Environmental Law are obtained and
complied with.

H. Grantor will permit, or cause any tenant to permit, Lender or Xxxxxx's
agent to enter and inspect the Property and review all records at any
reasonable time to determine (1) the existence, location and nature of
any Hazardous Substance on, under or about the Property; (2) the
existence, location, nature, and magnitude of any Hazardous Substance
that has been released on, under or about the Property; or (3) whether
or not Grantor and any tenant are in compliance with applicable
Environmental Law.

I. Upon Xxxxxx's request and at any time, Xxxxxxx agrees, at Xxxxxxx's
expense, to engage a qualified environmental engineer to prepare an
environmental audit of the Property and to submit the results of such
audit to Lender. The choice of the environmental engineer who will
perform such audit is subject to Xxxxxx's approval.

X. Xxxxxx has the right, but not the obligation, to perform any of
Grantor's obligations under this section at Grantor's expense.

K. As a consequence of any breach of any representation, warranty or
promise made in this section, (1) Grantor will indemnify and hold Lender
and Xxxxxx's successors or assigns harmless from and against all losses,
claims, demands, liabilities, damages, cleanup, response and remediation
costs, penalties and expenses, including without limitation all costs of
litigation and attorney's fees, which Xxxxxx and Xxxxxx's successors or
assigns may sustain; and (2) at Xxxxxx's discretion, Xxxxxx may release
this Security Instrument and in return Grantor will provide

(page 4 or 6)

Lender with collateral of at least equal value to the Property secured
by this Security Instrument without prejudice to any of Lender's rights
under this Security Instrument.

L. Notwithstanding any of the language contained in this Security
Instrument to the contrary, the terms of this section shall survive any
foreclosure or satisfaction of this Security Instrument regardless of
any passage of title to Lender or any disposition by Lender of any or
all of the Property. Any claims and defenses to the contrary are hereby
waived.

20. CONDEMNATION. Grantor will give Lender prompt notice of any pending or
threatened action, by private or public entities to purchase or take any or
all of the Property through condemnation, eminent domain, or any other
means. Grantor authorizes Xxxxxx to intervene in Grantor's name in any of
the above described actions or claims. Grantor assigns to Lender the
proceeds of any award or claim for damages connected with a condemnation or
other taking of all or any part of the Property. Such proceeds shall be
considered payments and will be applied as provided in this Security
Instrument. This assignment of proceeds is subject in the terms of any prior
mortgage, deed of trust, security agreement or other lien document.

21. INSURANCE. Grantor agrees to maintain insurance as follows:

A. Grantor shall keep the Property insured against loss by fire, flood,
theft and other hazards and risks reasonably associated with the
Property due to its type and location. This insurance shall be
maintained in the amounts and for the periods that Lender requires. The
insurance carrier providing the insurance shall be chosen by Grantor
subject to Lender's approval, which shall not be unreasonably withheld.
If Grantor fails to maintain the coverage described above, Lender may,
at Xxxxxx's option, obtain coverage to protect Xxxxxx's rights in the
Property according to the terms of this Security Instrument.

All insurance policies and renewals shall be acceptable to Lender and
shall include a standard "mortgage clause" and, where applicable, "loss
payee clause." Grantor shall immediately notify Lender of cancellation
or termination of the insurance. Lender shall have the right to hold the
policies and renewals. If Lender requires, Grantor shall immediately
give to Lender all receipts of paid premiums and renewal notices. Upon
loss, Grantor shall give immediate notice to the insurance carrier and
Lender. Lender may make proof of loss if not made immediately by
Grantor.

Unless otherwise agreed in writing, all insurance proceeds shall be
applied to restoration or repair of the Property or to the Secured Debt,
whether or not then due, at Xxxxxx's option. Any application of proceeds
to principal shall not extend or postpone the due date of scheduled
payment nor change the amount of any payments. Any excess will be paid
to the Grantor. If the Property is acquired by Lender, Xxxxxxx's right
to any insurance policies and proceeds resulting from damage to the
Property before the acquisition shall pass to Lender to the extent of
the Secured Debt immediately before the acquisition.

X. Xxxxxxx agrees to maintain comprehensive general liability insurance
naming Xxxxxx as an additional insured in an amount acceptable to
Lender, insuring against claims arising from any accident or occurrence
in or on the Property.

X. Xxxxxxx agrees to maintain rental loss or business interruption
insurance, as required by Xxxxxx, in an amount equal to at least
coverage of one year's debt service, and required escrow account
deposits (if agreed to separately in writing), under a form of policy
acceptable to Lender.

22. ESCROW FOR TAXES AND INSURANCE. Unless otherwise provided in a separate
agreement, Grantor will not be required to pay to Lender funds for taxes
and insurance in escrow.

23. FINANCIAL REPORTS AND ADDITIONAL DOCUMENTS. Grantor will provide to Lender
upon request, any financial statement or information Lender may deem
reasonably necessary. Grantor agrees to sign, deliver, and file any
additional documents or certifications that Lender may consider necessary
to perfect, continue, and preserve Grantor's obligations under this
Security Instrument and Lender's lien status on the Property.

24. JOINT AND INDIVIDUAL LIABILITY; CO-SIGNERS; SUCCESSORS AND ASSIGNS
BOUND. All duties under this Security Instrument are joint and individual.
If Grantor signs this Security Instrument but does not sign an evidence of
debt, Xxxxxxx does so only to mortgage Grantor's interest in the Property
to secure payment of the Secured Debt and Grantor does not agree to be
personally liable on the Secured Debt. If this Security Instrument secures
a guaranty between Xxxxxx and Grantor, Xxxxxxx agrees to waive any rights
that may prevent Xxxxxx from bringing any action or claim against Grantor
or any party indebted under the obligation. These rights may include, but
are not limited to, any anti-deficiency or one-action laws. Xxxxxxx agrees
that Xxxxxx and any party to this Security Instrument may extend, modify or
make any change in the terms of this Security Instrument or any evidence of
debt without Xxxxxxx's consent. Such a change will not release Grantor from
the terms of this Security Instrument. The duties and benefits of this
Security Instrument shall bind and benefit the successors and assigns of
Grantor and Xxxxxx.

25. APPLICABLE LAW; SEVERABILITY; INTERPRETATION. This Security Instrument is
governed by the laws of the jurisdiction in which Lender is located, except
to the extent otherwise required by the laws of the jurisdiction where the
Property is located. This Security Instrument is complete and fully
integrated. This Security Instrument may not be amended or modified by oral
agreement. Any section in this Security Instrument, attachments, or any
agreement related to the Secured Debt that conflicts with applicable law
will not be effective, unless that law expressly or impliedly permits the
variations by written agreement. If any section of this Security Instrument
cannot be enforced according to its terms, that section will be severed and
will not affect the enforceability of the remainder of this Security
Instrument. Whenever used, the singular shall include the plural and the
plural the singular. The captions and headings of the sections of this
Security Instrument are for convenience only and are not to be used to
interpret or define the terms of this Security Instrument. Time is of the
essence in this Security Instrument.

26. SUCCESSOR TRUSTEE. Xxxxxx, at Xxxxxx's option, may from time to time remove
Trustee and appoint a successor trustee without any other formality than
the designation in writing. The successor trustee, without conveyance of
the Property, shall succeed to all the title, power and duties conferred
upon Trustee by this Security Instrument and applicable law.

27. NOTICE. Unless otherwise required by law, any notice shall be given by
delivering it or by mailing it by first class mail to the appropriate
party's address on page 1 of this Security Instrument, or to any other
address designated in writing. Notice to one grantor will be deemed to be
notice to all grantors.

28. USURY SAVINGS. In no event shall any provision of this Security Instrument
or any other instrument evidencing or securing the Secured Debt ever
obligate Grantor to pay or allow Lender to collect interest on the Secured
Debt at a rate greater than the maximum non-usurious rate permitted by
applicable law.

29. WAIVERS. Except to the extent prohibited by law, Grantor waives all
appraisement relating to the Property.

(page 5 of 6)

30. U.C.C. PROVISIONS. If checked, the following are applicable to, but do not
limit, this Security Instrument:

[ ] CONSTRUCTION LOAN. This Security Instrument secures an obligation
incurred for the construction of an improvement on the Property.

[ ] FIXTURE FILING. Grantor grants to Lender a security interest in all
goods that Grantor owns now or in the future and that are or will become
fixtures related to the Property.

[ ] CROPS; TIMBER; MINERALS; RENTS, ISSUES, AND PROFITS. Grantors grants to
Lender a security interest in all crops, timber, and minerals located on
the Property as well as all rents, issues, and profits of them
including, but not limited to, all Conservation Reserve Program (CRP)
and Payment in Kind (PIK) payments and similar governmental programs
(all of which shall also be included in the term "Property").

[ ] PERSONAL PROPERTY. Grantor grants to Lender a security interest in all
personal property located on or connected with the Property; including
all farm products, inventory, equipment, accounts, documents,
instruments, chattel paper, general intangibles, and all other items of
personal property Grantor owns now or in the future and that are used or
useful in the construction, ownership, operation, management, or
maintenance of the Property (all of which shall also be included in the
term "Property"). The term "personal property" specifically excludes
that property described as "household goods" secured in connection with
a "consumer" loan as those terms are defined in applicable federal
regulations governing unfair and deceptive credit practices.

[ ] FILING AS FINANCING STATEMENT. Xxxxxxx agrees and acknowledges that this
Security Instrument also suffices as a financing statement and any
carbon, photographic or other reproduction may be filed of record for
purposes of Article 9 of the Uniform Commercial Code.

31. OTHER TERMS. If checked, the following are applicable to this Security
Instrument:

[X] LINE OF CREDIT. The Secured Debt includes a revolving line of credit
provision. Although the Secured Debt may be reduced to a zero balance,
this Security Instrument will remain in effect until released.

[ ] AGRICULTURAL PROPERTY. Grantor covenants and warrants that the Property
will be used principally for agricultural or farming purposes and that
Grantor is an individual or entity allowed to own agricultural land as
specified by law.

[X] SEPARATE ASSIGNMENT. The Grantor has executed or will execute a separate
assignment of leases and rents. Any such separate assignment duly
executed will supersede the "Assignment of Leases and Rents" section of
this Security Instrument.

[ ] ADDITIONAL TERMS.

SIGNATURES: By signing below, Xxxxxxx agrees to the terms and covenants
contained in this Security Instrument and in any attachments. Xxxxxxx also
acknowledges receipt of a copy of this Security Instrument on the date stated on
page 1.

THIS WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS,
OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.

THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

The parties' signatures below indicate agreement with the statements
contained within this box.

Entity Name: AMERICAN ENERGY SERVICES, INC., Entity Name:
CORPORATION ------------------------------------------------

BY: ------------------------------------------------ ------------------------------------------------
(Signature) (Date) (Signature) (Date)
Name: /s/ XXXXXXX X. XXXXXXX
Title: President

BY: ------------------------------------------------ ------------------------------------------------
(Signature) (Date) (Signature) (Date)
Name: ------------------------
Title: ------------------------

ACKNOWLEDGEMENT:

(Individual)

---------------------------------------
(Notary Public)

(Business or Entity Acknowledgment)

STATE OF TEXAS, COUNTY OF XXXXXX} ss.
This instrument was acknowledged before me this 2nd day of May, 1998
by NAME: AND NAME:
TITLE: AND TITLE: (Title(s))
of AMERICAN ENERGY SERVICES, INC. (Name of Business or Entity)
a CORPORATION on behalf of the business or entity.
My commission expires
(Seal)

---------------------------------------
(Notary Public)

(page 6 of 6

AMERICAN ENERGY SERVICES, INC. METROBANK, N.A. GALLERIA BRANCH
0000 XXXXXXXX 0000 XXXXXXXXXX, XXX. #0000
XXXXXXX, XX 00000 XXXXXXX, XX 00000
XXXXXXXX'S (BUYER'S OR LESSEE'S) NAME
AND ADDRESS SECURED PARTY'S (OR XXXXXX'S) NAME AND ADDRESS
"I" means the borrowers (buyers "You" means the secured party (or lessor) named
or lessees) named above. above.

DATE: 05/02/98 LOAN (LEASE OR CONTRACT) NUMBER: #721099972

ADDITIONAL INFORMATION: INVENTORY RELATED TO FOREIGN ACCOUNTS, ALL INVENTORY,
EQUIPMENT, FURNITURE & FIXTURES

SECTION 1: AGREEMENT TO PROVIDE INSURANCE: As part of my loan, lease, or
contract, I agree:

(1) to insure the property and/or the persons listed in section 2 with the
coverage shown in section 3 below;

(2) to have you named on the policy, with the "status" listed below;

(3) to arrange for the insurance company to notify you that the policy is
in effect and your status has been noted;

(4) to pay for this insurance, including any fee for this endorsement;

(5) to keep the insurance in effect until the debts listed above, and any
other debts which now or later may be secured by the property, are
paid. (I understand that the property may secure debts in addition to
any listed above.)

IF I DEFAULT: If I fail to keep one or more of these promises:

(1) I agree that you may (but are not required to) buy insurance to
protect your interest and add the cost to what I owe you.

(2) I also understand that I may be in default on the underlying debts,
and that you may decide to invoke other remedies available to you for
such default as well.

SECTION 2: DESCRIPTION OF COLLATERAL AND/OR PERSONS TO BE INSURED:

INVENTORY RELATED TO FOREIGN ACCOUNTS, ALL INVENTORY, EQUIPMENT, FURNITURE &
FIXTURES

Autos include: Year Make Model Body Style Vehicle Identification Number

SECTION 3: COVERAGES: Show the risks, amount of coverage required, and
maximum deductible allowed:

Homeowner's Coverage: [ ] H.O. [ ] Other (Describe)
Deductible:
Automobile Coverages: [ ] Fire [ ] Theft [ ] Collision [ ] Comprehensive
[ ] Liability
Deductible: Life and Disability Coverages: Minimum limits:

SECTION 4: YOUR STATUS: SHOW HERE HOW THE SECURED PARTY (OR LESSOR) SHOULD BE
LISTED ON THE INSURANCE POLICY: [ ] Lienholder [ ] Certificate Holder
[ ] Additional Insured [ ] Mortgagee [XX] LOSS PAYEE

SECTION 5: INSURANCE COMPANY: THIS IS THE INSURANCE COMPANY WHICH WILL PROVIDE
THE INSURANCE COVERAGE:

--------------------------------------------------------------------------------
Name Address City and State Policy Number Effective: from to

SECTION 6: INSURANCE AGENCY AND AGENT: THIS IS THE INSURANCE AGENCY THROUGH
WHICH I HAVE PURCHASED THE REQUIRED INSURANCE (OR INTEND TO):

--------------------------------------------------------------------------------
Name Address City and State Telephone Number

SECTION 7: SIGNATURES FOR BORROWERS (BUYERS OR LESSEES) AND AUTHORIZATION TO
INSURANCE AGENT AND COMPANY:

I (we) have made this agreement and have provided the information above. I have
received a copy of this agreement.

I (we) request the insurance company an agency shown above to provide the
average(s) listed above, and to show the Secured Party (or Lessor) on the policy
the status shown above.

I (we) also request that the insurance company or its authorized agent
immediately confirm the policy to the Secured Party (or Lessor) on the policy
with the status shown above.

I (we) also request that the insurance company or its authorized agent
immediately confirm the policy to the Secured Party (or Lessor) by signing this
form and forwarding a copy of the policy to the Secured Party (or Lessor), or
each part of the policy as may be necessary.

X AMERICAN ENERGY SERVICES, INC.
NAME: /s/XXX X. XXXXXXX , TITLE: Pres.

NAME:
------------------------------------, TITLE:------------------

SECTION 8: SIGNATURE FOR SECURED PARTY (LESSOR) AND REQUEST FOR CONFIRMATION:

I ask that upon receipt of this form the insurance company or agency named above
confirm the policy coverages shown above.

FOR THE SECURED PARTY: X -----------------------------------------
(OR LESSOR) XXXX XXXXXXXXX, V.P.

SECTION 9: SIGNATURE FOR INSURANCE COMPANY AND CONFIRMATION:

By signing below I confirm the insurance coverages agreed to be provided by our
insured and that you will be notified not less than 10 days before cancellation.

PLEASE TYPE NAME, TITLE, COMPANY, AND
PHONE NUMBER AND RETURN TO SECURED
PARTY OR LESSOR X --------------------------------------

(page 1 of 1)

AMERICAN ENERGY SERVICES, INC. METROBANK, N.A. GALLERIA Line of Credit No.#721099972
7224 LAWNDALE BRANCH Date MAY 2, 1998
HOUSTON, TX 77539 0000 XXXXXXXXXX, XXX. #1111 Max. Credit Amt. $2,000,000.00
XXXXXXXX'S NAME AND ADDRESS Houston, TX 77056 Loan Ref. No. #721099972
XXXXXX'S NAME AND ADDRESS "You" means the lender, its
"I" Includes each borrower above, successors and assigns.
jointly and severally.

You have extended to me a line of credit in the
AMOUNT of TWO MILLION AND NO/100 $2,000,000.00
You will make loans to me from time to time until 12:00 P.M., on September 2,
1998. Although the line of credit expires on that date, I will remain obligated
to perform all my duties under this agreement so long as I owe you any money
advanced according to the terms of this agreement, as evidenced by any note or
notes I have signed promising to repay these amounts.

This line of credit is an agreement between you and me. It is not intended that
any third party receive any benefit from this agreement, whether by direct
payment, reliance for future payment or in any other manner. This agreement is
not a letter of credit.

1. AMOUNT: This line of credit is:

[X] OBLIGATORY: You may not refuse to make a loan to me under this line of
credit unless one of the following occurs:

a. I have borrowed the maximum amount available to me;

b. This line of credit has expired;

c. I have defaulted on the note (or notes) which show my indebtedness
under this line of credit;

d. I have violated any term of this line of credit or any note or other
agreement entered into in connection with this line of credit;

e. ____________________________________________________________________

____________________________________________________________________

[ ] DISCRETIONARY: You may refuse to make a loan to me under this line of
credit once the aggregate outstanding advances equal or exceed
_____________________________ $____________________________________.

Subject to the obligatory or discretionary limitations above, this line of
credit is:

[X] OPEN-END (Business or Agricultural only): I may borrow up to the maximum
amount of principal more than one time.

[ ] CLOSED-END: I may borrow up to the maximum only one time.

2. PROMISSORY NOTE: I will repay any advances made according to this line of
credit agreement as set out in the promissory note, i signed on May 2, 1998,
or any note(s) I sign at a later time which represent advances under this
agreement. The note(s) set(s) out the terms relating to maturity, interest
rate, repayment and advances. If indicated on the promissory note, the
advances will be made as follows: SEE ATTACHED "LOAN MONITORING WORKSHEET"
AND "EXIM BANK SPECIAL CONDITIONS". UNLESS ALL CONDITIONS BY EXIM BANK HAVE
BEEN MET, METROBANK IS NOT OBLIGATED TO FUND.

3. RELATED DOCUMENTS: I have signed the following documents in connection with
this line of credit and note(s) entered into in accordance with this line of
credit:

[X] security agreement dated MAY 2, 1998 [X] ARBITRATION AGREEMENT
[ ] mortgage dated [ ]
[X] guaranty dated [ ]

4. REMEDIES: If I am in default on the note(s) you may:

a. take any action as provided in the related documents;

b. without notice to me, terminate this line of credit.

By selecting any of these remedies you do not give up your right to
later use any other remedy. By deciding not to use any remedy should I
default, you do not waive your right to later consider the event a default,
if it happens again.

5. COSTS AND FEES: If you hire an attorney to enforce this agreement I will pay
your reasonable attorney's fees, where permitted by law. I will also pay
your court costs and costs of collection, where permitted by law.

6. COVENANTS: For as long as this line of credit is in effect or I owe you
money for advances made in accordance with the line of credit, I will do the
following:

a. maintain books and records of my operations relating to the need for
this line of credit;

b. permit you or any of your representatives to inspect and/or copy these
records;

c. provide to you any documentation requested by you which support the
reason for making any advance under this line of credit;

d. permit you to make any advance payable to the seller (or seller and me)
of any items being purchased with that advance;

e. SEE ATTACHED "LOAN MONITORING WORKSHEET" AND "EXIM BANK SPECIAL
CONDITIONS". UNLESS ALL CONDITIONS BY EXIM BANK HAVE BEEN MET, METROBANK
IS NOT OBLIGATED TO FUND.

7. NOTICES: All notices or other correspondence with me should be sent to my
address stated above. The notice or correspondence shall be effective when
deposited in the mail, first class, or delivered to me in person.

8. MISCELLANEOUS: This line of credit may not be changed except by a written
agreement signed by you and me. The law of the state in which you are
located will govern this agreement. Any term of this agreement which is
contrary to applicable law will not be effective, unless the law permits you
and me to agree to such a variation.

FOR THE LENDER SIGNATURES: I AGREE TO THE TERMS OF
THIS LINE OF CREDIT. I HAVE RECEIVED
A COPY ON TODAY'S DATE

XXXX XXXXXXXXX AMERICAN ENERGY SERVICES, INC.
Title VICE PRESIDENT BY: /s/ X X XXXXXXX PRESIDENT
NAME: , TITLE:
BY:
NAME: , TITLE:

(page 1 of 1)

AMERICAN ENERGY SERVICES, INC. METROBANK, N.A. GALLERIA EXTENSION OF SECURITY
0000 XXXXXXXX XXXXXX XXXXXXXXX XXXXX:
XXXXXXX, XX 00000 0000 XXXXXXXXXX, XXX. #0000 XXX 0, 0000
XXXXXXX, XX 00000
DEBTOR'S NAME AND ADDRESS SECURED PARTY'S NAME AND ADDRESS

For value received, the Debtor hereby grants the Secured Party a security
interest in the following additional collateral:

EXHIBIT "A'

ASSIGNMENT OF ALL FOREIGN A/R AND PROCEEDS THEREOF AND ASSIGNMENT OF INVENTORY
RELATED TO FOREIGN ACCOUNTS (INCLUDING WIP); ALL INVENTORY, CHATTEL PAPER,
ACCOUNTS, CONTRACT RIGHTS, EQUIPMENT, GENERAL INTANGIBLES AND FIXTURES; TOGETHER
WITH THE FOLLOWING SPECIFICALLY DESCRIBED PROPERTY: FURNITURE, MACHINERY AND ANY
LEASEHOLD IMPROVEMENTS; WHETHER ANY OF THE FOREGOING IS OWNED NOW OR ACQUIRED
LATER; ALL ACCESSIONS, ADDITIONS, REPLACEMENTS, AND SUBSTITUTIONS RELATING TO
ANY OF THE FOREGOING; ALL RECORDS OF ANY KIND RELATING TO ANY OF THE FOREGOING;
ALL PROCEEDS RELATING TO ANY OF THE FOREGOING (INCLUDING INSURANCE, GENERAL
INTANGIBLES AND OTHER ACCOUNTS PROCEEDS). TO BE LOCATED AT 0000 XXXXXXXX,
XXXXXXX, XX 00000 OR WHEREVER LOCATED.

*************(CROSS-COLLATERALIZED WITH EXISTING AND PROPOSED LOANS);

By signing below, Xxxxxx acknowledges that this document describes additional
collateral which is subject to all terms and conditions of the Security
Agreement referred to above.

AMERICAN ENERGY SERVICES, INC.

Authorized Signature(s) of Secured Party -- sign below only if filing this
document.

Debtor BY: /s/ X X XXXXXXX PRESIDENT
(Name) (Title)

(page 1 of 1)

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EXHIBIT 6.3 AMERICAN ENERGY SERVICES, INC. 7224 LAWNDALE HOUSTON, TX 77539 TAXPAYER I.D. NUMBER: 76-0279883 METROBANK, N.A. GALLERIA BRANCH 5065 WESTHEIMER, STE. #1111 HOUSTON, TX 77056 SECURED PARTY'S NAME AND ADDRESS ("You" means the Secured Party,...

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