SECURED PROMISSORY NOTE

U.S. $4,484,077.00
Dallas, Texas
December 19, 2006

FOR VALUE RECEIVED, BUFFINGTON HIDDEN LAKES, LTD., a Texas limited partnership
(“Borrower”) hereby makes and issues this Secured Promissory Note (this “Note”),
and promises to pay to the order of UNITED DEVELOPMENT FUNDING III, L.P., a
Delaware limited partnership (together with its successors and assigns,
“Lender”) the principal sum of U.S. Four Million Four Hundred Eighty-Four
Thousand Seventy-Seven and NO/100 ($4,484,077.00) or, if greater or less, the
aggregate amount of all funds advanced to Borrower under this Note, together
with accrued, unpaid interest thereon, and all other amounts due to Lender
hereunder. The parties hereto hereby agree to the terms and conditions of this
Note, as further set forth below. The General Partner is executing this Note on
its own behalf for certain limited purposes described on the signature page to
this Note.
 
1. Certain Definitions. Certain capitalized terms which are defined in the text
of this Note shall have the respective meanings given to such terms herein. In
addition, the following capitalized terms shall have the following meanings:

(a) “Accrued Interest Payments” shall mean payments equal to the amount of
accrued interest on the outstanding principal balance of this Note, calculated
at the applicable rate of interest provided herein.

(b) “Base Rate” shall mean the lesser of (i) fifteen percent (15%) per annum, or
(ii) the Highest Lawful Rate.
 
(c) “Commitment” shall mean an aggregate amount of U.S. Four Million Four
Hundred Eighty-Four Thousand Seventy-Seven and NO/100 ($4,484,077.00).

(d) “Commitment Advance” shall mean the advance of the Commitment made to
Borrower at the closing of this Note in accordance with the provisions hereof.

(e) “Default Rate” shall mean the lesser of (i) eighteen percent (18%) per
annum, or (ii) the Highest Lawful Rate.

(f) “Effective Date” shall mean December 19, 2006.

(g) “Event of Default” shall have the meaning given to such term in Section 9 of
this Note.

(h) “General Partner” shall mean Buffington Hidden Lakes GP, Inc., a Texas
corporation and the general partner of Borrower.

(i) “Guaranty” shall mean that certain Continuing Unconditional Guaranty to be
executed by the General Partner in favor of Lender dated as of the Effective
Date,

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guaranteeing the prompt payment and performance of Borrower’s obligations under
this Note.

(j) “Highest Lawful Rate” shall mean the maximum lawful rate of interest which
may be contracted for, charged, taken, received or reserved by Lender in
accordance with the applicable laws of the State of Texas (or applicable United
States federal law, to the extent that it permits Lender to contract or charge,
take, receive or reserve a greater amount of interest than under Texas law),
taking into account all fees and expenses contracted for, charged, received,
taken or reserved by Lender in connection with the transaction relating to this
Note and the indebtedness evidenced hereby or by the other Loan Documents which
are treated as interest under applicable law.

(k) “Interest Reserve” shall mean an aggregate of up to $400,000.00 to be
advanced by Lender hereunder and to be applied against Accrued Interest
Payments, subject to the provisions of Section 4(c) of this Note.

(l) “Interest Reserve Advance” means an advance under this Note in the amount of
an Accrued Interest Payment pursuant to Section 4(c) of this Note.

(m) “LEN-BUF LP” shall mean LEN-BUF / HiddenLake 2 - JV, Ltd., a Texas limited
partnership, in which Borrower owns a 49.50% limited partnership interest and in
which the General Partner owns a 0.50% general partnership interest.

(n) “Loan Documents” shall mean this Note, the Pledge Agreement, the Guaranty
and all other documents, certificates, instruments, and agreements executed,
entered into or delivered by Borrower, the General Partner or any of their
respective affiliates in connection with this Note, as each such document may be
amended from time to time.

(o) “Maturity Date” means June 30, 2010.

(p) “Partnership Agreement” means the Agreement of Limited Partnership for
LEN-BUF / HiddenLake 2 - JV, Ltd., as it may be amended from time to time.

(q) “Pledge Agreement” shall mean that certain Pledge Agreement executed by
Borrower in favor of Lender dated as of the Effective Date, pursuant to which
Borrower pledges its limited partnership interest in LEN-BUF LP to Lender as
security for the prompt payment and performance of Borrower’s obligations to
Lender under this Note, as such agreement may be amended from time to time.

(r) “Property” shall mean each real property now owned or hereinafter acquired
by LEN-BUF LP, and “Properties” shall mean, collectively, all real properties
now owned or hereinafter acquired by LEN-BUF LP.
 

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2. Loan Expenses; Fees.

(a) Loan Expenses. No fees shall be due by Borrower in connection with the
origination and closing of the Loan. Lender shall bear the costs incurred in
connection with the drafting, negotiation and closing of this Note and the other
Loan Documents. Thereafter, Borrower shall pay Lender, the full amount of all
fees and expenses incurred by Lender (collectively, the “Loan Expenses”) in
connection with the loan made pursuant to this Note and the preparation of the
Note and the other Loan Documents, including, without limitation, attorneys
fees, accountants fees, closing costs, due diligence costs and expenses,
recording fees, courier and delivery fees, document preparation fees, wire
transfer and bank fees, title company fees, and all other fees and costs
incurred by Lender up to but not exceeding the aggregate sum of $5,000.00
annually (the “Annual Cap”); provided, however, that the Annual Cap on Loan
Expenses shall not apply (i) upon the occurrence and during the continuance of
any Event of Default, including, without limitation, to costs and expenses
incurred in connection with collection efforts or any workout or restructure of
this Note and the transactions contemplated hereby, and (ii) to costs incurred
in connection with any audit permitted by Section 9(l) of this Note.
 
(b) Usury Savings Clause Applies. Borrower and Lender agree that Lender has
provided, and shall provide, separate and distinct consideration for the fees
described in Section 2(a) above or that such expenses represent bona fide
expenses incurred by Lender, and that such fees are not intended to be
characterized as interest or as compensation for the use, forbearance or
detention of money. Despite the foregoing and notwithstanding anything else in
the Loan Documents to the contrary, if any fees charged hereunder are determined
to constitutes interest and such fees, when added to the interest charged
hereunder, would cause the aggregate interest charged hereunder to exceed the
Highest Lawful Rate, then Sections 4(b) and 11 of this Note shall automatically
apply to reduce the interest charged hereunder so as not to exceed the Highest
Lawful Rate.

(c) Assignment. All Loan Expenses are assignable by the payee to any affiliate
or third party.

3. Face Amount of Note; Commitment Advance; Borrowing Procedures; etc.

(a) Funding. At the closing, it is anticipated that Lender will fund $950,000.00
of the Commitment. Accordingly, after the closing, (i) 3,534,077.00 of the
Commitment will remain available for future Commitment Advances, and (ii) the
Interest Reserve ($400,000.00) will be available to fund Accrued Interest
Payments pursuant to Section 4(c) of this Note.

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(b) Commitment Advance. Subject to the terms and conditions of this Note, Lender
agrees to make Commitment Advances to Borrower from time to time during the
eight month period following the Closing until the entire Commitment is funded
during such eight month period; provided, that the aggregate amount of
Commitment Advances made hereunder shall not exceed the Commitment. This Note is
not a revolver and thus, the portion of the Commitment borrowed may not be
repaid to Lender and subsequently reborrowed under this Note.

(c) Procedure for Borrowing. Each Commitment Advance shall be made pursuant to a
notice of Commitment Advance stating the amount of Commitment being advanced and
the use of proceeds for the Commitment Advance which is executed by both Lender
and Borrower.

(d) Making of Commitment Advance. Subject to the terms and conditions of this
Note, provided that the notice of Commitment Advance is executed by Lender and
Borrower, Lender shall make the amount of the requested Commitment Advance
available to Borrower on the applicable funding date; provided, however, that
Lender shall have no obligation to make the Commitment Advance unless each of
the conditions precedent in Section 7 have been satisfied.

(e) Discretionary Advances. Lender hereby is authorized by Borrower to make
advances hereunder that Lender, in its sole discretion, deems necessary or
desirable to pay any Loan Expense or other amount chargeable to Borrower or the
General Partner pursuant to the terms of this Note or any other Loan Document
(such advances made for the foregoing purposes are referred to herein as the
“Discretionary Advances”), provided Lender has notified Borrower in writing of
such Loan Expense and provided Borrower with invoices and other supporting
documents and Borrower has failed to timely pay such Loan Expense or provide
Lender with written objections thereto. Each Discretionary Advance shall, upon
disbursement, automatically constitute principal outstanding hereunder and cause
a corresponding increase in the aggregate amount of Borrower’s obligations
hereunder (even if such Discretionary Advance causes the aggregate amount
outstanding hereunder to exceed the face amount of this Note). The making by
Lender of any Discretionary Advance shall not cure any Event of Default
hereunder, unless Lender provides Borrower with a written waiver of such Event
of Default.

4. Interest; Payments.

(a) Interest Rate. The outstanding principal amount of this Note shall bear
interest on each day outstanding at the Base Rate in effect on such day, accrued
and compounded monthly, unless the Default Rate shall apply. Upon the occurrence
and during the continuation of an Event of Default, the outstanding principal
amount of this Note shall, automatically and without the necessity of notice,
bear interest from the date of such Event of Default at the Default Rate,
accrued and compounded monthly, until all such delinquent amounts are paid or
such breach or Event of Default is otherwise cured to the satisfaction of Lender
or waived by Lender in writing.

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(b) Highest Lawful Rate. Notwithstanding anything to the contrary contained in
this Note or any other Loan Document, (i) this Note shall never bear interest in
excess of the Highest Lawful Rate, and (ii) if at any time the rate at which
interest is payable on this Note is limited by the Highest Lawful Rate by the
foregoing clause (i) or by reference to the Highest Lawful Rate in the
definitions of Base Rate and Default Rate, then this Note shall bear interest at
the Highest Lawful Rate and shall continue to bear interest at the Highest
Lawful Rate until such time as the total amount of interest accrued on this Note
equals (but does not exceed) the total amount of interest which would have
accrued on this Note, had there been no Highest Lawful Rate applicable to this
Note.

(c) Interest Payments; Interest Reserve Advances. Accrued Interest Payments
shall be due and payable on the last day of each month (for interest accrued
during that month) while this Note is outstanding. Notwithstanding the foregoing
sentence and subject to the other provisions hereof, on each date that an
Accrued Interest Payment becomes due and payable hereunder, Lender shall make an
Interest Reserve Advance hereunder in the amount of such Accrued Interest
Payment, which shall be applied to the Accrued Interest Payment then due and
payable, until the Interest Reserve has been fully exhausted. Subject to the
other provisions of this Note, each time Lender funds an Interest Reserve
Advance hereunder, (i) Borrower’s requirement to make the Accrued Interest
Payment for such month shall be satisfied, (ii) the amount of remaining Interest
Reserve shall be reduced by the amount of such Interest Reserve Advance, and
(ii) such Interest Reserve Advance funded by Lender hereunder shall
automatically become principal outstanding under this Note upon such funding.
The Interest Reserve Advances may be funded by Lender even if such funding
causes the outstanding principal balance of this Note to exceed its face amount.
Notwithstanding anything else to the contrary contained herein, (i) if at any
time an Event of Default has occurred and is continuing under this Note, Lender
shall not be obligated to make any further Interest Reserve Advances, and
thereafter, shall do so only in its sole discretion, unless and until the Event
of Default is cured to Lender’s satisfaction as evidenced in writing, and (ii)
in no event shall Lender be obligated to make any Interest Reserve Advance that
would cause the aggregate amount of Interest Reserve Advances made hereunder to
exceed the remaining Interest Reserve.

(d) Payments. Subject to the other provisions of this Note:

(i) Accrued Interest Payments shall be due and payable as provided in Section
4(c) of this Note;

(ii) within five (5) business days following Borrower’s and/or the General
Partner’s receipt of any distribution(s) from LEN-BUF LP, Borrower shall make a
payment hereunder equal to the amount of such distribution(s), which payments
shall be applied as provided in Section 5(a) hereof; and

(iii) except as set forth in clauses (i) and (ii) above and except upon any
acceleration of this Note pursuant to its terms, the outstanding principal
balance

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of this Note, together with all accrued, unpaid interest thereon, unpaid Loan
Expenses and other unpaid amounts due hereunder, shall be due and payable on the
Maturity Date.

5. Terms and Conditions of Payment.

(a) Application of Payments. Subject to the application of Interest Reserve
Advances to Accrued Interest Payments as provided in Section 4(c) of the Note,
all payments on this Note shall be applied first, to unpaid Loan Expenses due
hereunder, next, to unpaid accrued interest, and last, to principal outstanding
under this Note. Notwithstanding the foregoing sentence, if any Event of Default
occurs and is existing under this Note or any other Loan Document, Lender shall
have the right to apply payments toward amounts due under this Note as Lender
determines in its sole discretion.

(b) General. All amounts are payable to Lender in lawful money of the United
States of America at the address for Lender provided in this Note, or at such
other address as from time to time may be designated by Lender. Borrower will
make each payment which it owes under this Note and the other Loan Documents to
Lender in full and in lawful money of the United States, without set-off,
deduction or counterclaim. Under no circumstance may Borrower offset any amount
owed by Borrower to Lender under this Note with an amount owed by Lender to
Borrower under any other arrangement. All payments shall be made by cashier's
check or wire transfer of immediately available funds. Should any such payment
become due and payable on a day other than a business day, the date for such
payment shall be extended to the next succeeding business day, and, in the case
of a required payment of principal, interest or Loan Expenses or other amounts
then due, interest shall accrue and be payable on such amount for the period of
such extension. Each such payment must be received by Lender not later than 3:00
p.m., Dallas, Texas time on the date such payment becomes due and payable. Any
payment received by Lender after such time will be deemed to have been made on
the next succeeding business day.

(c) Prepayment. Borrower may prepay this Note in whole or in part at any time
and from time to time without incurring any prepayment fee or penalty; provided,
that interest shall accrue on the portion of this Note so prepaid through the
date of such prepayment.

6. Loan Deliveries. At or prior to the closing of the loan made pursuant to this
Note, Borrower shall deliver or cause to be delivered to Lender, the following
items, each of which shall be satisfactory in form and substance to Lender:

(a) this Note and each other Loan Document, duly executed by Borrower and the
General Partner, as applicable;

(b) The most recent consolidated financial statements of Borrower and the
General Partner, in the form specified in Section 9(f) of this Note, and
accompanied by the certification required by Section 9(f) of this Note;

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(c) a certified copy of the formation documents and all amendments thereto, of
Borrower and the General Partner and all other documents filed with the
secretary of state of the state of organization of Borrower and the General
Partner;

(d) a certificate of existence and good standing (as applicable) for Borrower
and the General Partner, issued by the appropriate governmental authority;

(e) resolutions of Borrower and the General Partner authorizing Borrower’s and
the General Partner’s execution, delivery, and performance of this Note and the
other Loan Documents, and the transactions contemplated hereby and thereby;
 
(f) a copy of all partnership agreements, shareholders’ agreements, voting
agreements, and voting trusts among the shareholders, partners, or owners of
each partnership, limited liability company, or other entity, the equity
interests of which are pledged to Lender under the Pledge Agreement;

(g) a certificate of Borrower’s and the General Partner’s general liability
policies, and evidence of payment of the premium through at least one year;

(h) a certificate (the “Officer’s Certificate”) executed by an appropriate
officer on behalf of Borrower and the General Partner certifying that (i) no
Event of Default has occurred and is continuing under the Note, (ii) all
representations and warranties made in this Note and the other Loan Documents
are true and correct in all respects, and (iii) Borrower and the General Partner
have complied with and performed, in all respects, all covenants, conditions and
agreements which are then required by this Note and the other Loan Documents to
have been complied with or performed;

(i) the Partnership Agreement and all amendments thereto as of the Effective
Date, and written consents of the partners thereto, authorizing the transactions
contemplated hereby and by the other Loan Documents including, without
limitation, the Pledge Agreement;
 
(j) endorsements of the insurance policies covering the Properties naming Lender
as an additional insured; and

(k) such other and further documents, agreements and certificates as are
reasonably required by Lender.

7. Conditions Precedent to Commitment Advance. Notwithstanding anything to the
contrary contained herein or in the other Loan Documents, Lender’s obligation to
fund the Commitment Advance shall be conditioned upon the satisfaction of each
of the following conditions, on and as of the funding date for the Commitment
Advance:

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(a) Borrower and the General Partner shall have executed and delivered to
Lender, an Officer’s Certificate dated as of the funding date, and all matters
certified in the Officer’s Certificate shall be true and correct in all
respects;

(b) the requested Commitment Advance, if made, would not cause the aggregate
amount of all outstanding Commitment Advances to exceed the Commitment; and

(c) there shall be no default by any partner under the Partnership Agreement,
nor shall there be any claim, cause of action, demand or similar dispute among
the partners to the Partnership Agreement.
 
8. Representations and Warranties. Each of Borrower and the General Partner
jointly and severally represents and warrants to Lender that:

(a) Organization and Good Standing; Authorization. Each of Borrower and the
General Partner (i) is duly organized, validly existing and in good standing
under the laws of its jurisdiction of organization, and (ii) has full power and
authority to own its properties, carry on its business and to perform the
transactions contemplated by this Note and the other Loan Documents. All
necessary partnership, limited liability company, partnership, member, partner
and other actions required to be taken on behalf of Borrower and the General
Partner to approve this Note and the other Loan Documents and the transactions
contemplated hereby and thereby, have been duly taken. Each of Borrower and the
General Partner is in compliance in all material respects with all laws
applicable to it in each jurisdiction within and without outside the United
States where it owns or leases any properties or conducts any business, except
for any such non-compliance that would not have a material adverse effect,
individually or in the aggregate, on Borrower’s or the General partner’s
financial condition or operations.

(b) Authority; Validity. Each of Borrower and the General Partner has the power,
authority and legal right to execute, deliver and perform its obligations under
this Note and the other Loan Documents. The execution and delivery by Borrower
and the General Partner of the Note and the other Loan Documents, and the
performance of their respective obligations thereunder, will not (i) violate the
certificate of formation or partnership agreement or bylaws of Borrower and the
General Partner, (ii) violate any law or result in a default under any contract,
agreement, or instrument to which Borrower and the General Partner is a party or
by which Borrower and the General Partner or any of their respective assets and
properties are bound, or (iii) result in the creation or imposition of any
security interest in, or lien or encumbrance upon any of their respective
assets. The Loan Documents constitute the legal, valid and binding obligations
of Borrower and the General Partner and are enforceable against them in
accordance with their terms, except as enforceability may be limited by
bankruptcy, insolvency or similar laws affecting the enforcement of creditors’
rights generally.

(c) Litigation. There is no pending order, notice, claim, litigation, proceeding
or investigation against or affecting Borrower and the General Partner or any of
their

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respective assets or properties, whether or not covered by insurance, that could
materially and adversely affect either the financial condition or business
prospects or Borrower and the General Partner, if adversely determined.

(d) Indebtedness. Neither Borrower nor the General Partner has any material
indebtedness of any nature, to the extent disclosed in the latest financial
statements delivered to Lender or otherwise disclosed in writing to Lender and
approved by Lender.

(e) Environmental Liability. To the best of Borrower’s and the General Partner’s
knowledge, no hazardous substances or solid wastes have been disposed of or
otherwise released on or to any Properties, except as may have been otherwise
disclosed to Lender in a Phase I environmental report delivered to Lender. The
terms “hazardous substance” and release” shall have the meanings specified in
the Comprehensive Environmental Response Compensation and Liability Act of 1980,
as amended, (“CERCLA”), and the terms “solid waste” and “disposal” (or
“disposed”) shall have the meanings specified in the Resource Conservation and
Recovery Act of 1976, as amended, (“RCRA”); provided, to the extent that the
laws of the State of Texas establish a meaning for “hazardous substance”,
“release”, “solid waste”, or “disposal” or “disposed”) that is broader than that
specified in either CERCLA or RCRA, such broader meaning shall apply.

(f) Tax Liabilities. Each of Borrower and the General Partner has filed all
federal, state, county, local, and foreign tax returns and reports required to
have been filed by them (or has obtained valid extensions with respect to such
returns and reports), including but not limited to such returns and reports with
respect to income, payroll, property, employee withholding, social security,
unemployment, franchise, excise, use and sales taxes. Each of Borrower and the
General Partner has paid in full all taxes that have become due as reflected on
all such returns and reports (including any interest and penalties) and has
established adequate reserves for all taxes payable but not yet due. No
governmental claim for additional taxes, interest, or penalties is pending or,
to Borrower’s and the General Partner’s knowledge, threatened against Borrower
or the General Partner or any of their respective properties or assets.
 
9. Covenants. Each of Borrower and the General Partner jointly and severally
covenants and agrees with Lender that they will comply with each of the
following covenants below:

(a) Payment; Performance. Borrower shall promptly pay all amounts due and owing
to Lender under this Note. Borrower and the General Partner shall timely perform
and comply with each agreement and covenant made under this Note and the other
Loan Documents.

(b) Use of Proceeds. The proceeds of this Note shall be used solely for
Borrower’s business purposes and in accordance with the applicable provisions of
the Partnership Agreement. In no event shall the proceeds of this Note be used,
directly or indirectly, by any person for personal, family, household or
agricultural purposes or for

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the purpose, whether immediate, incidental or ultimate, of purchasing, acquiring
or carrying any “margin stock” (as such term is defined in Regulation U
promulgated by the Board of Governors of the Federal Reserve System).

(c) Other Loans. Borrower and the General Partner shall not enter into any
promissory note, loan documents, or other agreement for borrowed money without
the prior written consent of Lender. Unless otherwise agreed by Lender in
writing, any loan permitted by Lender shall contemplate that (i) the proceeds
(or a portion thereof, in an amount agreed by Lender) from such loan shall be
used to pay off the loan made pursuant to this Note, and (ii) if this Note will
remain outstanding, the bank financial institution or other lender providing the
financing (the “New Lender”) shall agree to provide Lender with written notice
of any default or event of default occurring under the loan documents evidencing
its loan, and the New Lender shall agree that upon any default by Borrower,
Lender shall have the right, but not the obligation, to cure Borrower’s default
thereunder and to purchase the loan and the loan documents from the New Lender.

(d) Termination of Existence. Nether Borrower nor the General Partner shall
cause, or enter into any agreement to cause, the dissolution or termination of
the existence of Borrower or the General Partner or the merger, consolidation,
or reorganization of Borrower or the General Partner with or into any other
entity, whether or not such person would be the surviving entity.

(e) Notice of Certain Events. Borrower and the General Partner shall promptly
notify Lender in writing of the occurrence of any event or series of events of
which any of them has actual knowledge causing, or that could be expected to
cause or has caused (i) a material adverse effect on the operations or financial
condition of Borrower or the General Partner, (ii) the occurrence of any Event
of Default (without giving effect to any cure period applicable thereto), or
(iii) any default by Borrower or the General Partner the acceleration of the
maturity of any indebtedness owed by Borrower or the General Partner under any
indenture, mortgage, agreement, promissory note, contract or other instrument to
which Borrower or the General Partner is a party or by which any material asset
or property of Borrower or the General Partner is bound. In addition, each of
Borrower and the General Partner agrees to notify Lender in writing at least
twenty (20) business days prior to the date that it changes its name, address,
the location of its chief executive office or principal place of business, and
the place where it keeps its books and records.

(f) Financial Statements. Borrower and the General Partner shall deliver to
Lender, the following financial statements: (i) within sixty (60) days after the
end of each fiscal quarter, the unaudited financial statements of Borrower and
the General Partner, prepared in accordance with GAAP and combined or
consolidated as appropriate, including all notes related thereto; and
(ii) within one hundred twenty (120) days after the end of each fiscal year, the
unaudited financial statements of Borrower and the General Partner, prepared in
accordance with GAAP and combined or consolidated as appropriate, including all
notes related thereto. All financial statements provided to Lender shall be
certified as to accuracy and completeness by appropriate officers.

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(g) Taxes. Borrower and the General Partner shall pay all federal, state and
local taxes levied against them and their respective properties and assets as
they become due and payable and before the same become delinquent. Borrower and
the General Partner shall have the right to pay such tax under protest or to
otherwise contest any such tax or assessment, but only if (i) such contest has
the effect of preventing the collection of such taxes so contested and also of
preventing the sale or forfeiture of any property subject thereto, (ii) Borrower
and the General Partner have notified Lender of their intent to contest such
taxes, and (iii) adequate reserves for the liability associated with such tax
have been established in accordance with GAAP. Borrower and the General Partner
shall furnish to Lender evidence that all such taxes are paid at least five (5)
days prior to the last date for payment of such taxes.

(h) Assets. Neither Borrower nor the General Partner shall pledge, encumber,
sell, assign, transfer, convey, or grant a security interest against any of
their respective properties or assets, except as set forth in the Partnership
Agreement or as otherwise approved by Lender’s prior written consent.

(i) Indebtedness. Neither Borrower nor the General Partner shall incur any
indebtedness for borrowed money, other than as otherwise approved by Lender’s
prior written consent.

(j) Distributions; Dividends. At any time when any amounts are due to Lender
hereunder, Borrower shall not declare, pay, make, or authorize any
distributions, whether in cash or in property, to its partners, and the General
Partner shall not declare or pay any dividends to its shareholders, without
Lender’s prior written consent.

(k) LEN-BUF LP Documents. Borrower and the General Partner shall furnish to
Lender promptly upon receipt, all documents that they receive in their capacity
as partners of LEN-BUF LP, including without limitation, all of the following:

(i) all financial statements, pro formas, projections, budgets, capital
expenditure and expense reports, and other financial information, and all
information related to the operations of LEN-BUF LP;

(ii) minutes of the meetings of the general partners of LEN-BUF LP, and all
written consents of the general partners of LEN-BUF LP;

(iii) all loan documents evidencing indebtedness for borrowed money of LEN-BUF
LP, and all amendments thereto;

(iv) the title commitment for each Property, the title exception documents and,
upon issuance, the title policy for each Property;

(v) for each Property, all due diligence documents related to such Property,
including, without limitation, a Phase I Environmental Report, survey,

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plat, appraisal, and engineering due diligence report, land use, zoning,
subdivision, grading, municipal district, environmental, and other governmental
permits, approvals, authorizations and maps necessary to develop such Property
in compliance with applicable Governmental Regulations;

(vi) certificates of general liability and hazard insurance for LEN-BUF LP and
builder’s liability insurance covering each Property;

(vii) for each Property, all project updates, development reports, sales
reports, budgets, pro formas, and similar information; and

(viii) copies of all records of disbursements made from LEN-BUF LP to Borrower
and/or the General Partner including, without limitation, copies of checks or
wire transfer confirmations.

(l) Audit. Borrower and the General Partner shall permit Lender and its
employees, representatives, auditors, collateral verification agents, attorneys
and accountants (collectively, the “Lender Representatives”), at any time and
from time to time, at Borrower’s and the General Partner’s expense, to (i) audit
all books and records related to Borrower and the General Partner and their
respective properties and assets, and (ii) visit and inspect any of their
respective offices and assets and properties and to inspect and make copies of
all books and records, and to write down and record any information the Lender
Representatives obtain. Each of Borrower and the General Partner agrees to
cooperate fully in connection with such audits and inspections.

(m) Assignments. Borrower shall not assign, transfer or convey, any partnership
interest, capital stock, or other equity interest in any partnership,
corporation, limited liability company, or other entity, the equity interests of
which are pledged under the Pledge Agreement.

(n) Insurance. Borrower and the General Partner shall, at all times, maintain or
cause to be maintained, hazard insurance on the Properties with coverage amounts
that are normal and customary for similarly-situated entities engaged in similar
businesses. Each such hazard insurance policy shall provide that Lender be given
at least thirty (30) days written notice as a condition precedent to any
cancellation thereof or material change therein. Borrower shall obtain or cause
to be obtained, an endorsement to each such policy naming Lender as an
additional insured to each such policy, and provide Lender annually with the
insurance certificate, evidencing such coverage, the endorsement of each such
policy to lender, and evidence of payment of the premium for each such policy.

(o) Operation of Business. Borrower and the General Partner shall operate their
businesses in compliance with all applicable federal, state and local laws,
rules, regulations, and ordinances. Each of Borrower and the General Partner
shall maintain their existence and good standing in each state where they
operate or do any business. Each of Borrower and the General Partner shall
obtain all consents, licenses, permits,

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authorizations, permissions and certificates which may be required or imposed by
any governmental or quasi-governmental agency, authority or body which are
required by applicable federal, state or local laws, regulations and ordinances.

(p) Additional Pledge. Borrower and the General Partner agree that they shall
use their best efforts to obtain, no later than thirty (30) days after the
Effective Date, all third party consents required for the General Partner to
pledge its general partnership interest in LEN-BUF LP to Lender as security for
the prompt payment and performance of Borrower’s obligations under this Note.
Upon obtaining such third party consents, the General Partner shall enter into,
execute and deliver to Lender, a pledge agreement in the same form as the Pledge
Agreement, pursuant to which the General Partner shall pledge its general
partnership interest in LEN-BUF LP to Lender, accompanied by resolutions of the
General Partner authorizing the pledge agreement and the transactions
contemplated thereby, an assignment of the partnership interest executed in
blank, and such other certificates, documents and agreements as may be
reasonably requested by Lender in connection therewith. If Borrower and the
General Partner are unable to obtain the required third party consents for any
reason, then the General Partner agrees that it shall (i) shall consult with
Lender prior to taking or consenting to any material action, or making any
material decision in its capacity as a general partner of LEN-BUF LP with
respect to LEN-BUF LP, and (ii) agree to permit a representative of Lender to
attend, as an observer, all meetings of the general partners of LEN-BUF LP and
use its best efforts to obtain the consent of Lennar Texas Holding Company, a
Texas corporation (or any substitute general partner) to such attendance.

10. Default.

(a) For purposes of this Note, the following events shall constitute an “Event
of Default”:

(i) except for Accrued Interest Payments due during any period when Accrued
Interest Payments are required to be made by Lender pursuant to Section 4(c),
the failure of Borrower to make any payment required by this Note in full on or
before the date such payment is due (or declared due pursuant to the terms of
this Note), whether on or prior to the Maturity Date and such failure continues
for a period of ten (10) days thereafter; or

(ii) any financial statement, representation, warranty, or certificate made or
furnished by or with respect to Borrower and the General Partner contained in
this Note or any other Loan Document or made in connection herewith or
therewith, shall be materially false, incorrect, or incomplete when made; or

(iii) Borrower and the General Partner shall fail to perform or observe any
covenant or agreement contained in this Note or any other Loan Document that is
not separately listed in this Section 10(a) as an Event of Default, and the

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same remains unremedied for thirty (30) days after written notice of such
failure is given by Lender to Borrower; or

(iv) any “event of default” or “default” occurs under any Loan Document other
than this Note and the same remains unremedied for thirty (30) days after
written notice is given by Lender to Borrower and the General Partner, as
applicable; or

(v) the entry of a decree or order for relief by a court having jurisdiction in
respect of Borrower and the General Partner in an involuntary case under the
federal bankruptcy laws, as now or hereafter constituted, or any other
applicable federal or state bankruptcy, insolvency or other similar law, which
is not vacated or dismissed within thirty (30) days, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or other similar
official) of Borrower and the General Partner for any substantial part of their
property, or ordering the winding up or liquidation of such person’s affairs; or

(vi) the commencement by Borrower and the General Partner of a voluntary case
under the federal bankruptcy laws, as now constituted or hereafter amended, or
any other applicable federal or state bankruptcy, insolvency or other similar
law, or the consent by it to the appointment to or taking possession by a
receiver, liquidator, assignee, trustee, custodian, sequestrator (or other
similar official) of Borrower and the General Partner for any substantial part
of its property, or the making by Borrower or the General Partner of any
assignment for the benefit of creditors, or the admission by Borrower and the
General Partner in writing of such entity’s inability to pay its debts generally
as they become due; or

(vii) the appointment of or taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official of all or a
substantial part of Borrower’s, the General Partner’s assets or of any part of
any property in a proceeding brought against or initiated by Borrower, the
General Partner; or

(viii) if Borrower and the General Partner is liquidated or dissolved or winds
up their affairs, or the sale or liquidation of all or substantially all of the
assets of Borrower and the General Partner; or

(ix) except as otherwise permitted herein, Borrower assigns, transfers, or
conveys any partnership interest, capital stock, or other equity interest in any
partnership, corporation, limited liability company, or other entity, the equity
interests of which are pledged under the Pledge Agreement without the prior
written consent of Lender; or

(x) any “default” or “event of default” not cured within the grace period, if
any, for such default or event of default, shall occur under (A) any credit
agreement, loan agreement, promissory note, or other document evidencing
indebtedness for borrowed money incurred by Borrower and the General Partner,

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or (B) any subordination agreement, security agreement, pledge agreement,
guaranty, deed of trust, or other agreement providing security or collateral for
indebtedness, executed by Borrower and the General Partner, or (C) any joint
venture agreement, revenue or profits sharing or participation agreement,
partnership agreement, shareholders agreement, securities purchase agreement or
any other agreement governing to which Borrower and the General Partner is a
party, if Lender or any of its affiliates is also a party to such agreement (the
terms “default” and “event of default” having the meaning given to such terms in
any of the agreements described above).

(b) Upon the occurrence of an Event of Default described in subsection (a)(v),
(vi) or (vii) above, all obligations under this Note and the other Loan
Documents shall thereupon be immediately due and payable, without demand,
presentment, notice of demand or of dishonor and nonpayment, protest, notice of
protest, notice of intention to accelerate, declaration or notice of
acceleration, or any other notice or declaration of any kind, all of which are
hereby expressly waived by Borrower and the General Partner. During the
continuance of any other Event of Default, then and in every such case Lender
may do any or all of the following: (i) declare the principal of this Note
together with all accrued and unpaid interest on the unpaid principal balance,
and Loan Expenses and other amounts due to Lender under this Note or the other
Loan Documents, to be due and payable immediately, and the same shall become and
be due and payable, without notices, demands for payment, presentations for
payment, notices of payment default, notices of intention to accelerate
maturity, protest and notice of protest, and any other notices of any kind, all
of which are expressly waived by Borrower and the General Partner and any and
all sureties, guarantors and endorsers of this Note, (ii) exercise its rights
under any of the Loan Documents, and (iii) exercise all other rights and
remedies available to Lender under this Note and the other Loan Documents and at
law and at equity, including, without limitation, such rights existing under the
Uniform Commercial Code. No delay on the part of Lender in exercising any power
under this Note shall operate as a waiver of such power or right nor shall any
single or partial exercise of any power or right preclude further exercise of
that power or right.

(c) If this Note is placed in the hands of an attorney for collection after an
Event of Default or failure to pay under this Note, or if all or any part of the
indebtedness represented hereby is proved, established or collected in any court
or in any bankruptcy, receivership, debtor relief, probate or other court
proceedings, Borrower and the General Partner and all endorsers, sureties and
guarantors of this Note, jointly and severally, agree to pay reasonable
attorneys' fees and collection costs to Lender in addition to the principal and
interest payable under this Note.

11. Usury Laws.  It is the intention of the parties to this Note to comply with
all applicable laws, including, without limitation, usury laws. In furtherance
thereof, Borrower and the General Partner and Lender stipulate and agree that
none of the terms and provisions contained in this Note or the other Loan
Documents shall ever be construed to create a contract to pay for the use,
forbearance, or detention of money, or interest, in excess of the maximum amount
of interest permitted to be charged by applicable law in effect from time to
time. Neither

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Borrower nor any present or future guarantors, endorsers, or other persons or
entities hereafter becoming liable for payment of Borrower’s obligations
hereunder and under the other Loan Documents shall ever be liable for unearned
interest thereon or shall ever be required to pay interest thereon in excess of
the maximum amount that may be lawfully charged under applicable law from time
to time in effect, and the provisions of this Section 11 shall control over all
other provisions of the Loan Documents that may be in conflict or apparent
conflict herewith. Lender expressly disavows any intention to charge or collect
excessive unearned interest or finance charges in the event the maturity of this
Note is accelerated. If (a) the maturity of this Note is accelerated for any
reason, (b) this Note is prepaid and as a result any amounts held to constitute
interest are determined to be in excess of the legal maximum, or (c) Lender or
any other holder of the Note shall otherwise collect moneys which are determined
to constitute interest which would otherwise increase the interest hereon to an
amount in excess of that permitted to be charged by applicable law, then all
sums determined to constitute interest in excess of such legal limit shall,
without penalty, be promptly applied to reduce the then outstanding principal of
this Note or, at Lender's or such holder's option, promptly returned to Borrower
or the other payor thereof upon such determination. In determining whether or
not the interest paid or payable, under any specific circumstance, exceeds the
maximum amount permitted under applicable law, Lender and Borrower (and any
other payors of this Note) shall to the greatest extent permitted under
applicable law, (a) characterize any non-principal payment as an expense, fee or
premium rather than as interest, (b) exclude voluntary prepayments and the
effects thereof, and (c) amortize, prorate, allocate, and spread the total
amount of interest throughout the entire contemplated term of this Note in
accordance with the amounts outstanding from time to time hereunder and the
maximum legal rate of interest from time to time in effect under applicable law
in order to lawfully charge the maximum amount of interest permitted under
applicable law. In the event applicable law provides for an interest ceiling
under Chapter 303 of the Texas Finance Code (the “Texas Finance Code”) as
amended, for that day, the ceiling shall be the “weekly ceiling” as defined in
the Texas Finance Code. As used in this section the term “applicable law” means
the laws of the State of Texas or the laws of the United States of America,
whichever laws allow the greater interest, as such laws now exist or may be
changed or amended or come into effect in the future.

12. Indemnity; Release. Each of Borrower and the General Partner, jointly and
severally, agrees to indemnify Lender, upon demand, from and against any and all
liabilities, obligations, claims, losses, damages, penalties, fines, actions,
judgments, suits, settlements, costs, expenses or disbursements (including
reasonable, documented fees of attorneys, accountants, experts and advisors) of
any kind or nature whatsoever, now existing (in this section, collectively
called “Liabilities and Costs”) to the extent actually imposed on, incurred by,
or asserted against Lender in its capacity as lender hereunder growing out of,
resulting from or in any other way associated with (a) this Note and the other
Loan Documents or any of the transactions and events (including the enforcement
or defense thereof) at any time associated therewith or contemplated therein,
(b) any claim that the loan evidenced hereby is contractually usurious, and (c)
any use, handling, storage, transportation, or disposal of hazardous or toxic
materials on or about any Property or any part thereof or any real properties
owned, managed or operated by Borrower and the General Partner.

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THE FOREGOING INDEMNIFICATION SHALL APPLY WHETHER OR NOT SUCH LIABILITIES AND
COSTS ARE IN ANY WAY OR TO ANY EXTENT OWED IN WHOLE OR IN PART UNDER ANY CLAIM
OR THEORY OF STRICT LIABILITY, OR ARE CAUSED IN WHOLE OR IN PART, BY ANY
NEGLIGENT ACT OR OMISSION OF ANY KIND BY LENDER;

provided only that Lender shall not be entitled under this section to receive
indemnification for that portion, if any, of any Liabilities and Costs which is
proximately caused by its own individual gross negligence or willful misconduct,
as determined in a final judgment. If any person (including Borrower and the
General Partner) ever alleges such gross negligence or willful misconduct by
Lender, the indemnification provided for in this section shall nonetheless be
paid upon demand, subject to later adjustment or reimbursement, until such time
as a court of competent jurisdiction enters a final judgment as to the extent
and effect of the alleged gross negligence or willful misconduct. As used in
this section, the term “Lender” shall refer not only to the person designated as
such in this Note but also to each partner, director, officer, attorney,
employee, representative and affiliate of such person.

13. Mutual Understanding. Each of Borrower and the General Partner represents
and warrants to Lender that it and its principals have read and fully
understands the terms and provisions hereof, has had an opportunity to review
this Note with legal counsel and has executed this Note based on its own
judgment and advice of counsel. If an ambiguity or question of intent or
interpretation arises, this Note will be construed as if drafted jointly by
Borrower, the General Partner and Lender and no presumption or burden of proof
will arise favoring or disfavoring any party because of authorship of any
provision of this Note.

14. Further Assurances. Each of Borrower and the General Partner, at their own
expense, will promptly execute and deliver to Lender on Lender’s request, all
such other and further documents, agreements and instruments, and shall deliver
all such supplementary information, in compliance with or accomplishment of
their agreements and covenants under this Note and the other Loan Documents.

15. Cumulative Remedies. Borrower and the General Partner hereby agrees that all
rights and remedies that Lender is afforded by reason of this Note are separate
and cumulative with respect to Borrower and the General Partner and otherwise
and may be pursued separately, successively, or concurrently, as Lender deems
advisable. In addition, all such rights and remedies are non-exclusive and shall
in no way limit or prejudice Lender’s ability to pursue any other legal or
equitable rights or remedies that may be available to Lender.

16. Notice. All notices and other communications under this Note will be in
writing and will be mailed by registered or certified mail, postage prepaid,
sent by facsimile, delivered personally by hand, or delivered by nationally
recognized overnight delivery service addressed to Borrower or the General
Partner, at 1710 West 6th Street, Austin, Texas 78703, Facsimile No. (512)
732-2826 or, with respect to Lender, to Lender at 1812 Cindy Lane, Suite 200,
Bedford, Texas 76021, Facsimile No. (817) 835-0383 or with respect to any party,
to such other address as a party may have delivered to the other parties for
purposes of notice. Each notice or other communication will be treated as
effective and as having been given and received (a) if sent by

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mail, at the earlier of its receipt or three (3) business days after such notice
or other communication has been deposited in a regularly maintained receptacle
for deposit of United States mail, (b) if sent by facsimile, upon confirmation
of facsimile transfer, (c) if delivered personally by hand, upon written
confirmation of delivery from the person delivering such notice or other
communication, or (d) if sent by nationally recognized overnight delivery
service, upon written confirmation of delivery from such service.

17. Enforcement and Waiver by Lender. Lender shall have the right at all times
to enforce the provisions of this Note and the other Loan Documents in strict
accordance with their respective terms, notwithstanding any conduct or custom on
the part of Lender in refraining from so doing at any time or times. The failure
of Lender at any time or times to enforce its rights under such provisions,
strictly in accordance with the same, shall not be construed as having created a
custom or in any way or manner modified or waived the same. All rights and
remedies of Lender are cumulative and concurrent and the exercise of one right
or remedy shall not be deemed a waiver or release of any other right or remedy.

18. CHOICE OF LAW; JURISDICTION; VENUE. EXCEPT TO THE EXTENT THAT THE VALIDITY
OR PERFECTION OF SECURITY INTERESTS OR REMEDIES IN RESPECT OF ANY PARTICULAR
COLLATERAL IS GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF
TEXAS, THIS NOTE AND THE OTHER LOAN DOCUMENTS SHALL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE SUBSTANTIVE LAWS OF THE STATE OF TEXAS, WITHOUT REGARD
TO ITS CONFLICTS OF LAWS PROVISIONS. JURISDICTION FOR ALL MATTERS ARISING OUT OF
THIS NOTE AND THE OTHER LOAN DOCUMENTS SHALL BE EXCLUSIVELY IN THE STATE AND
FEDERAL COURTS SITTING IN DALLAS COUNTY, TEXAS, AND EACH OF BORROWER AND THE
GENERAL PARTNER HEREBY IRREVOCABLY SUBMITS ITSELF TO THE JURISDICTION OF SUCH
STATE AND FEDERAL COURTS AND AGREES AND CONSENTS NOT TO ASSERT IN ANY
PROCEEDING, THAT ANY SUCH PROCESS IS BROUGHT IN AN INCONVENIENT FORUM OR THAT
THE VENUE THEREOF IS IMPROPER, AND FURTHER AGREES TO A TRANSFER OF SUCH
PROCEEDING TO THE COURTS SITTING IN DALLAS COUNTY, TEXAS.

19. Counterparts. This Note and each other Loan Document may be executed in any
number of counterparts, each of which shall be deemed to be an original, but all
of which together shall constitute but one and the same instrument.

20. Severability. If any provision of this Note or any other Loan Document shall
be held invalid under any applicable laws, then all other terms and provisions
of this Note and the Loan Documents shall nevertheless remain effective and
shall be enforced to the fullest extent permitted by applicable law.

21. Amendments; Waivers. No amendment or waiver of any provision of this Note
nor consent to any departure herefrom, shall in any event be effective unless
the same shall be in writing and signed by Lender and the affected person, and
then such waiver or consent shall be effective only in the specific instance and
for the specific purpose for which given.

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22. Binding Effect; Assignment. This Note and the other Loan Documents shall be
binding on Borrower and the General Partner and their respective administrators,
other legal representatives, successors, heirs and assigns, including, without
limitation, any receiver, trustee or debtor in possession of or for Borrower and
the General Partner, and shall inure to the benefit of Lender and its successors
and assigns. Neither Borrower nor the General Partner shall be entitled to
transfer or assign this Note and the other Loan Documents in whole or in part
without the prior written consent of Lender. This Note and the other Loan
Documents are freely assignable and transferable by Lender to an affiliate of
Lender without the consent of Borrower or the General Partner. Assignments or
transfers by Lender to parties other than affiliates of Lender shall require the
prior written consent of Borrower. Should the status, composition, structure or
name of Borrower and the General Partner change, this Note and the other Loan
Documents shall continue and also cover such entity under the new status
composition, structure or name according to the terms of this Note and the other
Loan Documents.

23. Captions. The captions in this Note are for the convenience of reference
only and shall not limit or otherwise affect any of the terms or provisions
hereof.

24. Number of Gender of Words. Except where the context indicates otherwise,
words in the singular number will include the plural and words in the masculine
gender will include the feminine and neutral, and vice versa, when they should
so apply.
 
25. WAIVER OF JURY TRIAL, PUNITIVE DAMAGES, ETC. EACH OF BORROWER AND THE
GENERAL PARTNER HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY, AND IRREVOCABLY
(A) WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR DIRECTLY OR
INDIRECTLY AT ANY TIME ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE OR
THE LOAN DOCUMENTS OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY OR
ASSOCIATED HEREWITH OR THEREWITH, BEFORE OR AFTER MATURITY OF THIS NOTE; (B)
WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE TO
CLAIM OR RECOVER IN ANY SUCH LITIGATION ANY “SPECIAL DAMAGES”, AS DEFINED BELOW,
(C) CERTIFIES THAT NO PARTY HERETO NOR ANY REPRESENTATIVE OF LENDER OR COUNSEL
FOR ANY PARTY HERETO HAS REPRESENTED, EXPRESSLY OR OTHERWISE, OR IMPLIED THAT
SUCH PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVERS, AND (D) ACKNOWLEDGES THAT LENDER HAS BEEN INDUCED TO ENTER INTO THIS
NOTE AND THE OTHER LOAN DOCUMENTS AND THE TRANSACTIONS CONTEMPLATED HEREBY AND
THEREBY BY AMONG OTHER THINGS, THE WAIVERS AND CERTIFICATIONS CONTAINED IN THIS
SECTION. AS USED IN THIS SECTION, “SPECIAL DAMAGES” INCLUDES ALL SPECIAL,
CONSEQUENTIAL, EXEMPLARY, OR PUNITIVE DAMAGES (REGARDLESS OF HOW NAMED), BUT
DOES NOT INCLUDE ANY PAYMENTS OR FUNDS WHICH ANY PARTY HERETO

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HAS EXPRESSLY PROMISED TO PAY OR DELIVER TO ANY OTHER PARTY HERETO.

26. ENTIRE AGREEMENT. THIS NOTE AND THE OTHER LOAN DOCUMENTS TOGETHER CONSTITUTE
THE ENTIRE AGREEMENT AMONG THE PARTIES CONCERNING THE SUBJECT MATTER HEREOF, AND
ALL PRIOR DISCUSSIONS, AGREEMENTS AND STATEMENTS, WHETHER ORAL OR WRITTEN, ARE
MERGED INTO THIS NOTE AND THE OTHER LOAN DOCUMENTS. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS AMONG THE PARTIES AND THIS NOTE AND THE OTHER LOAN DOCUMENTS MAY NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES.

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This Note has been executed on the ___ day of ________________, 2006, effective
for all purposes as of the Effective Date.

BORROWER:

       
BUFFINGTON HIDDEN LAKES, LTD.,
a Texas limited partnership
 
By:  Buffington Hidden Lakes GP, Inc.,
Its:  General Partner
 
   
   
    By:   /s/ Patrick Starley  

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Patrick Starley   Vice President

LENDER:    

       
UNITED DEVELOPMENT FUNDING III, L.P.,
a Delaware limited partnership
 
By:  UMTH Land Development, L.P.
Its:  General Partner
 
By:  UMT Services, Inc.
 
   
   
    By:   /s/ Jeff Shirley  

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Jeff Shirley   Executive Vice President

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AGREED AND ACKNOWLEDGED BY:

THE GENERAL PARTNER

Buffington Hidden Lakes GP, Inc., acting in its own capacity, hereby (i) agrees
with and accepts all of the terms and conditions of this Note which are
applicable to the General Partner (as such term is defined in the Note), and
(ii) makes the representations, warranties, covenants and agreements in the Note
which are, by their terms, applicable to General Partner.

       
BUFFINGTON HIDDEN LAKES GP, INC.,
a Texas corporation
 
   
   
  Date:  By:   /s/ Patrick Starley  

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Patrick Starley   Vice President