expansion of Fire Station No. 1-all of lot 16, south 15' of lot 15, block 39, Town of La Porte

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File No. 1229-09-1280 Policy No. 0-5890-000437720 SCHEDULE B EXCEPTIONS FROM COVERAGE This policy does not insure against loss or damage (and the Company will not pay costs, attorneys' fees or expenses) that arise by reason of the terms and conditions of the leases and easements, if any, shown in Schedule A, and the following matters: 1. The following restrictive covenants of record itemized below (the Company must either insert specific recording data or delete this exception): ITEM 1 OF SCHEDULE B IS HEREBY DELETED IN ITS ENTIRETY. But deleting any covenant, condition or restriction indicating a preference, limitation or discrimination based on race, color, religion, sex, handicap, familial status or national origin unless and only to the extent that said covenant (a) is exempt under chapter 42, section 3607 of the United States code or (b) Relates to handicap but does not discriminate against handicapped persons. 2. Any discrepancies, conflicts, or shortages in area or boundary lines, or any encroachments or protrusions, or any overlapping of improvements. 3. Homestead or community property or survivorship rights, if any, of any spouse of any insured. 4. Any titles or rights asserted by anyone, including but not limited to, persons, the public, corporations, governments or other entities. a. to tidelands, or lands comprising the shores or beds of navigable or perennial rivers and streams, lakes, bays, gulfs or oceans, or b. to lands beyond the line of the harbor or bulkhead lines as established or changed by any government, or c. to filled-in lands, or artificial islands, or d. to statutory water rights, including riparian rights, or e. to the area extending from the line of mean low tide to the line of vegetation or the right of access to that area or easement along and across that area. 5. Standby fees, taxes and assessments by any taxing authority for the year 2009 and subsequent years; and subsequent taxes and assessments by any taxing authority for prior years due to change in land usage or ownership, but not those taxes or assessments for prior years because of an exemption granted to a previous owner of the property under Section 11.13, Texas Tax Code, or because of improvements not assessed for a previous tax year. 6. The following matters and all terms of the documents creating or offering evidence of the matters (The Company must insert matters or delete this exception.): A. Rights of Parties in possession. B. Any and all unrecorded leases and/or rental agreements, with rights of tenants in possession. C. Subject to any visible or apparent easements and/or rights of way on, over under or across the subject property, the existence of which would appear on a current survey. FORM T1: Owner's Policy of Title Insurance Page 2 of 4 1229-09-1280