Exhibit 10.2


 


FIRST LOAN MODIFICATION AGREEMENT


(Rosehill Reserve – UDF V Loan #9002)


 


THIS FIRST LOAN MODIFICATION
AGREEMENT (this “Agreement”) is entered into to be effective as of the 5th day of December,
2014 (the “Effective Date”), by and among ROSEHILL RESERVE, LTD., a Texas limited partnership
(“Borrower”), HARRIGAN DEVELOPMENT PARTNERS, LLC, a Texas limited liability company (“General
Partner”), and THOMAS LLOYD HARGROVE, JR., a natural person residing in Harris County, Texas (“Hargrove”,
and together with General Partner, the “Borrower-Related Parties”), and UNITED DEVELOPMENT FUNDING
INCOME FUND V, a Maryland real estate investment trust (“Lender”).


 


RECITALS:


 


A.          On
December 5, 2014, Lender made a loan to Borrower in the original principal amount of $42,372,200.00 (as modified, the “Loan”),
pursuant to that certain Loan Agreement dated effective as of December 5, 2014 (as modified, the “Loan Agreement”)
among Borrower, the Borrower-Related Parties, and Lender.


 


B.          The
Loan is evidenced and secured by, and is subject to, among other things, (i) that certain Secured Promissory Note dated effective
as of December 5, 2014, issued by Borrower and payable to the order of Lender and its assigns in the original principal amount
of $42,372,200.00 (the “Note”); (ii) that certain Deed of Trust, Assignment of Leases and Rents, Security
Agreement and Fixture Filing (the “Deed of Trust”) executed by Borrower, as the grantor thereunder, to
Todd Etter, Trustee for the benefit of Lender and its assigns, recorded on December 12, 2014 in the Official Public Records of
Harris County, Texas as Instrument Number 20140555272, covering certain real property as described therein, and (iii) the other
Loan Documents (as defined in the Loan Agreement).


 


C.           Borrower
has requested that Lender extend the Maturity Date to December 5, 2017 (the “Borrower Request”).


 


D.           Lender
has consented to the Borrower Request provided that Borrower and the Borrower-Related Parties, as applicable, enter into, execute
and deliver to Lender, the following: (i) this Agreement, and (ii) such other agreements, certificates, resolutions, security instruments,
amendments, modifications, and supplements as Lender requires.


 


AGREEMENT:


 


NOW, THEREFORE, for and
in consideration of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Lender,
Borrower and the Borrower-Related Parties agree as follows:


 


1.           General
Definitions. Capitalized terms used in this Agreement shall have the meanings given to such terms in the Loan Agreement, as
modified by this Agreement.


 


2.           Extension
of Maturity. The Maturity Date is hereby extended to December 5, 2017; subject, however, to the terms and conditions of the
Loan Agreement and the other Loan Documents. Borrower and the Borrower-Related Parties understand and agree that Lender has no
obligation to provide any further extension of the Maturity Date.


 



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3.          Costs.
Borrower agrees to pay all costs and expenses incurred by Lender in connection with the transactions contemplated by this Agreement
and the other Loan Documents, including, without limitation, transfer taxes, mortgage taxes, attorneys’ fees, title insurance
policy and/or endorsement charges, recording fees, and reasonable fees and expenses of legal counsel to Lender.


 


4.          Representations.
Borrower and each Borrower-Related Party hereby represent and warrant to Lender that (i) the execution, delivery and performance
of this Agreement and the other Loan Documents have been authorized by all requisite action on the part of Borrower and each Borrower-Related
Party, and concurrently with the execution of this Agreement, Borrower and each Borrower-Related Party have delivered to Lender
resolutions of the general partner and managers and members of Borrower and each Borrower-Related Party, as the case may be, authorizing
this Agreement and the transactions contemplated hereby, and (ii) after giving effect to this Agreement, no Event of Default has
occurred and is continuing and no event or condition has occurred that with the giving of notice or lapse of time or both would
constitute an Event of Default under the Loan Documents.


 


5.         No
Defenses. Borrower and each Borrower-Related Party hereby warrant, represent, and certify to Lender the following facts knowing
that Lender requires, and is relying upon, the warranties, representations, and certifications contained in this paragraph as a
condition to entering into this Agreement: (a) as of the date hereof, neither Borrower nor any Borrower-Related Party has any defense,
right of setoff, counterclaim, claim, or cause of action of any kind or description against Lender related to (i) payment of the
principal sum described in the Note and Loan Documents, (ii) payment of interest under the Note and the Loan Documents, (iii) payment
of any other sums due and payable under the Note or any of the other Loan Documents, (iv) performance of any obligations under
the Loan Documents, or (v) any of Lender’s acts or omissions with respect to the Loan, the Loan Documents or Lender’s
performance under the Loan Documents, and (b) Lender is not in default and no event has occurred which, with the passage of time,
giving of notice, or both, would constitute a default by Lender of Lender’s obligations under the terms and provisions of
the Loan Documents. To the extent Borrower or any Affiliate thereof now has, or in the future possesses, any defenses, rights of
setoff, counterclaims, claims or causes of action against Lender or the repayment of all or a portion of the Loan, whether known
or unknown, fixed or contingent, the same are hereby forever irrevocably waived and released in their entirety.


 


6.         Release.
In consideration of Lender’s agreement to grant the Borrower Request, and the other benefits received by Borrower and each
Borrower-Related Party hereunder, Borrower and each Borrower-Related Party hereby RELEASES, RELINQUISHES and forever DISCHARGES
Lender, as well as its partners and their respective predecessors, successors, assigns, agents, officers, directors, employees
and representatives (collectively, the “Lender Group”) of and from any and all claims, demands, actions and
causes of action of any and all kind and character, whether known or unknown, present or future, which any of them may have against
Lender or any member of the Lender Group arising out of or in any way connected with or in any way resulting from the acts, actions
or omissions of Lender or any member of the Lender Group in connection with the Loan or the Loan Documents, including, without
limitation, any breach of fiduciary duty, breach of any duty of fair dealing, breach of confidence, breach of funding, commitment,
undue influence, duress, economic coercion, conflict of interest, negligence, bad faith, malpractice, violations of any state or
federal usury laws, any violations of federal or state usury laws, any violations of federal or state Fair Debt Collection Practices
Act, any violations of the Real Estate Settlement and Procedures Act, intentional or negligent infliction of mental distress, tortious
interference with contractual relations, corporate governance, or prospective business advantage, breach of contract, deceptive
trade practices, liable, slander, conspiracy or any claim for wrongful accelerating the Note or wrongfully attempting to foreclose
on any collateral relating to the Note, but in each case only to the extent permitted by applicable law.


 



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7.          Ratification;
No Waiver. Borrower and the Borrower-Related Parties hereby represent and agree that there are no oral agreements which modify
any of the Loan Documents, and that the Loan Documents, as expressly modified by this Agreement, remain unaltered and in full force
and effect and constitute the entire agreement between Borrower, the Borrower-Related Parties and Lender with respect to the Loan.
Nothing herein shall constitute, and there has not otherwise occurred, any extinguishment or release of the obligations and agreements
of Borrower and the Borrower-Related Parties under the Loan Documents, and nothing herein shall constitute, and there has not otherwise
occurred, any novation with respect to the Note. Borrower and the Borrower-Related Parties do hereby expressly ratify and confirm
that the liens and security interests created by the security instruments, including, without limitation, the Deed of Trust, are
valid and subsisting. Nothing in this Agreement shall be understood or construed to be a satisfaction or release, in whole or in
part, of any obligation of Borrower or the Borrower-Related Parties under the Loan Documents. Without limitation of the foregoing,
Borrower and the Borrower-Related Parties acknowledge and agree that (i) any and all rights, titles, interests and liens securing
the repayment of the Loan, as modified by this Agreement, are hereby reaffirmed, renewed and extended, including, without limitation,
the rights, titles, interests and liens created in the Deed of Trust and the other Loan Documents, and (ii) any Guaranty Agreement
executed by one or more Borrower-Related Parties guaranteeing the payment of the Loan, as modified by this Agreement, is and shall
remain in full force and effect and continues to guaranty and secure the payment of the Loan, as modified by this Agreement. Borrower
and the Borrower-Related Parties hereby agree that nothing herein shall constitute a waiver by Lender of any Event of Default,
whether known or unknown, which may now or hereafter exist. Borrower and the Borrower-Related Parties hereby further agree that
no action, inaction or agreement by Lender, including, without limitation, any extension, indulgence, waiver, consent, or agreement
of modification which may occur or be granted or entered into with respect to nonpayment of the Loan or any portion thereof, or
with respect to matters involving security for the Loan, or with respect to any other matter relating to the Loan, shall require
or imply any future extension, indulgence, waiver, consent, or agreement by Lender, and that Lender has made no agreement, and
is in no way obligated, to grant any future extension, indulgence, waiver, or consent or enter into any further agreement or modification
with respect to the Loan or any matter relating to the Loan.


 


8.          Binding
Effect; Assignment. This Agreement shall be binding on Borrower and the Borrower-Related Parties and their respective successors
and assigns, including, without limitation, any receiver, trustee or debtor in possession of or for Borrower or any Borrower-Related
Party, and shall inure to the benefit of Lender and its successors and assigns. Should the status, composition, structure or name
of Borrower or any Borrower-Related Party change, this Agreement and the other Loan Documents shall continue to be binding upon
such Person and also cover such Person under the new status, composition, structure or name according to the terms hereof and thereof.


 


9.          Captions;
Number or Gender of Words. The captions in this Agreement are for the convenience of reference only and shall not limit or
otherwise affect any of the terms or provisions hereof. 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.


 


10.        Counterparts.
This Agreement 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.


 



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


 


12.         Amendments;
Waivers. No amendment or waiver of any provision of this Agreement nor consent to any departure here from 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.


 


13.         Cumulative
Remedies. All rights and remedies that Lender is afforded by reason of this Agreement are separate and cumulative with respect
to Borrower, Borrower-Related Parties or any of them 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.


 


14.         Construction.
Each party hereto acknowledges that it has participated in the negotiation of this Agreement and each of the parties has had sufficient
time to review this Agreement, have been represented by legal counsel at all times, have entered into this Agreement voluntarily
and without fraud, duress, undue influence or coercion of any kind. No representations or warranties have been made by Lender to
any party expect as set forth in this Agreement.


 


15.         ORAL
AGREEMENTS INEFFECTIVE. THIS AGREEMENT AND THE OTHER “LOAN AGREEMENTS” (AS DEFINED IN SECTION 26.02(A)(2) OF THE
TEXAS BUSINESS & COMMERCE CODE, AS AMENDED) REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES, AND THIS AGREEMENT AND THE OTHER
WRITTEN LOAN AGREEMENTS MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE
PARTIES. 


 


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


 



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IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be executed on the 21st day of April, 2015 to be effective as of the Effective Date.


 


BORROWER: 


 


ROSEHILL RESERVE, LTD.,


a Texas limited partnership


 


	By:	Harrigan Development Partners, LLC,	 
	 	a Texas limited liability company	 
	Its:	General Partner	 
	 	 	 
	 	/s/ Thomas Hargrove	 
	 	Thomas Hargrove	 
	 	Partner	 
	 	 	 
	 	/s/ Brian McGown	 
	 	Brian McGown	 
	 	Partner	 


 



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BORROWER-RELATED PARTIES:


 


HARRIGAN DEVELOPMENT PARTNERS, LLC,


a Texas limited liability company


 


	 	/s/ Thomas Hargrove	 
	 	Thomas Hargrove	 
	 	Partner	 
	 	 	 
	 	/s/ Brian McGown	 
	 	Brian McGown	 
	 	Partner	 


 


	/s/ Thomas Lloyd Hargrove, Jr.	 
	THOMAS LLOYD HARGROVE, JR.	 


 



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LENDER:


 


UNITED DEVELOPMENT FUNDING INCOME FUND V,


a Maryland real estate investment trust


 


	/s/ David A. Hanson	 
	David. A. Hanson	 
	Chief Operating Officer	 


 



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