Exhibit 10.3
 

LOAN PURCHASE AGREEMENT
(Frisco Hills)

THIS LOAN PURCHASE AGREEMENT (this “Agreement”), dated as of the 23rd day of
August, 2010 (the “Effective Date”), is executed by FH 295, LLC, a Texas limited
liability company (“Assignor”), and UDF IV ACQUISITIONS, L.P., a Delaware
limited partnership (“Assignee”).

RECITALS:

A. Assignor is the legal and equitable owner and holder of a Promissory Note
executed by Frisco Hills, LP, a Texas limited partnership (the “Borrower”), in
favor of Colonial Bank, N.A. and its assigns, dated as of March 2, 2007,
evidencing a loan (the “Loan”) in the original principal amount of
$23,000,000.00, as amended, modified, extended or renewed (the “Note”).
 
B. The Note is secured by that certain Deed of Trust, dated March 2, 2007,
executed by the Borrower in favor of Colonial Bank, N.A. and its assigns,
recorded March 15, 2007, under County Clerk’s Number 2007-31062, Real Property
Records of Denton County, Texas, as amended from time to time (the
“Mortgage/Deed of Trust”), and by security interests as evidenced by financing
statements recorded under No. 07-0010356133 with the Texas Secretary of State
and 2007-31128 in the Official Records of Denton County, Texas.
 
C. Assignor is the legal and equitable owner and holder of the loan documents
executed in connection with the Note and Mortgage/Deed of Trust, all of which
are more particularly described on Exhibit 1 attached hereto and incorporated by
this reference (all such loan documents collectively, the “Loan Documents”).
 
D. Assignee desires to purchase from Assignor, and Assignor has agreed to sell
to Assignee, all of Assignor’s right, title and interest in, to and under the
Loan, the Note and the Loan Documents, subject to the terms and conditions
contained herein.
 

AGREEMENT:

NOW, THEREFORE, in consideration of the premises herein contained and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending legally to be bound, covenant and
agree as follows:

1.           Assignment. Subject to and in accordance with the terms and
conditions hereof, Assignor agrees to sell, transfer assign and convey to
Assignee, and Assignee agrees to purchase from Assignor, without recourse,
warranty or representation whatsoever except as otherwise set forth herein, all
of Assignor's right, title, interest, claim and demand in, to and arising under
(i) the Note; (ii) all property and rights, whether real or personal, tangible
or intangible, which secure the Note and any other obligations of the Borrower
therein, whether directly or indirectly, including, without limitation, the
Mortgage/Deed of Trust and the Loan Documents; (iii) all Loan Assets (which
term, for purposes of this Agreement, has the same meaning incorporated by
reference into the Assignment (as hereinafter defined)), other Loan Documents
and other guaranties, security agreements and other instruments and documents
evidencing or relating to the Note or any other obligations of the Borrower
therein, including any title and other insurance policies and the proceeds
thereof payable to Assignor and all moneys, principal and interest, due and to
become due thereon and all rights, remedies and incidents thereunto belonging.

 
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2.           Representations.  Assignor represents and warrants to Assignee as
follows:  (i)   Assignor has full power and authority to enter into and perform
its obligations under this Agreement and to sell the Loan Assets to the
Assignee, (ii) this Agreement has been duly authorized, executed and delivered
by the Assignor, and constitutes the legal, valid and binding agreement of the
Assignor enforceable against the Assignor in accordance with its terms, except
as the enforceability thereof may be limited by applicable bankruptcy law and by
general principles of equity, regardless of whether such enforceability shall be
considered in a proceeding in equity or at law, (iii) no consent, approval,
authorization or order of any court or government agency or body is required for
the exertion, delivery and performance by the Assignor of or compliance by the
Assignor with this Agreement, the delivery of any Loan Documents, or the sale of
any of the Loan Assets to the Assignee, except such consents, approvals and
authorizations as will be obtained by Assignor prior to the Closing Date (as
hereinafter defined), and (iv) immediately prior to the transfer and sale of the
Loan Assets pursuant to the Assignment, the Assignor will be the sole owner of,
and will hold full legal and equitable title to, the Loan Assets.
 
3.           Purchase Price.  The purchase price for the Loan and the Loan
Documents is Ten Million Five Hundred Thousand and NO/100 Dollars
($10,500,000.00) payable in cash or immediately available funds (the “Purchase
Price”).

4.           Closing.  Subject to the terms and provisions hereof, the closing
of the purchase and sale of the Loan and the Loan Documents shall occur on or
prior to August 23, 2010 (the “Closing Date”) at a mutually agreeable
location.  On the Closing Date (a) Assignee shall pay the Purchase Price to
Assignor; and (b) Assignor shall (i) deliver the original Note and the Loan
Documents to Assignee, together with a statement of the outstanding amount of
principal and interest owing on the Loan on the Closing Date, (ii) execute and
deliver to Assignee an Allonge in the form attached hereto as Exhibit “B”
endorsing the Note payable to the order of Assignee, and (iii) execute and
deliver to Assignee, an assignment of the Note, Deed of Trust and Loan Documents
in the form attached hereto as Exhibit “C” (the “Assignment”). Notwithstanding
anything else to the contrary contained herein, Assignee has no obligation to
acquire the Loan and the Loan Documents from Assignor unless it obtains
sufficient financing for the purchase, and unless the Assignor acquires the Loan
and Loan Documents from BB&T on terms acceptable to Assignee.

5.           Further Actions.  Assignor and Assignee each hereby covenants and
agrees to execute and deliver all such documents and to take all such further
actions as either of them may reasonably deem necessary from time to time to
further evidence the purchase and sale of the Loan and the Loan Documents and to
consummate the transactions contemplated hereby.

6.           Governing Law.  THIS AGREEMENT AND ALL RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF
TEXAS, WITHOUT REGARD TO ITS PRINCIPLES OF CONFLICTS OF LAW.

7.           Assignment.  This Agreement and the terms, covenants, conditions,
provisions, obligations, undertakings, rights and benefits hereof, including any
attachments hereto, shall be binding upon, and shall inure to the benefit of,
the undersigned parties and their respective successors and assigns.

8.           Counterparts; Modifications; Waivers.  This Agreement may be signed
in counterparts, each of which shall be an original and all of which taken
together shall constitute one agreement.  This Agreement may not be changed,
waived, discharged or terminated orally, but only by an instrument in writing
signed by the party against which enforcement of such change, waiver, discharge
or termination is sought.

 
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9.           Entire Agreement.  This Agreement sets forth the entire agreement
and understanding of the parties hereto, and supersedes all prior agreements and
understandings between the parties hereto with respect to the transactions
contemplated hereby.

[The remainder of this page is left blank intentionally.]

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IN WITNESS WHEREOF, the undersigned have duly executed this Agreement on this
the 23rd day of August, 2010 to be effective as of the Effective Date.

ASSIGNOR:

HF 295, LLC,
a Texas limited liability company

 
 
By:  Centamtar Terras, LLC, a Texas limited liability company, its Manager

 

 
By: CTMGT, LLC, a Texas limited
       liability company, its Manager

By:           /s/ Mehrdad Moayedi 
Name:                      Mehrdad Moayedi 
Title:           President                                                                

ASSIGNEE:

UDF IV ACQUISITIONS, L.P.,
a Delaware limited partnership

By:           UDF IV AC Manager, LLC,
a Delaware limited liability company,
its General Partner

By:           United Development Funding IV,
a Maryland real estate investment trust,
its Manager

By:           /s/ David Hanson                                           
Name:           David Hanson 
Title:           Chief Operating Officer 

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