Document:

Exhibit 10.5

 

LOAN AGREEMENT

 

THIS LOAN AGREEMENT
(“Agreement”) is made and entered into as of November 14, 2014, by and between VERITEX COMMUNITY BANK
(and its successors and assigns “Bank”) and UNITED DEVELOPMENT FUNDING INCOME FUND V, a Maryland real
estate investment trust (“Borrower”).

 

RECITALS

 

A.           Borrower
has requested that Bank extend credit to Borrower as described in this Agreement.

 

B.           Subject
to and upon the provisions, terms and conditions of this Agreement, Bank is willing to make such credit available to Borrower and
has agreed to lend to Borrower the amounts herein described for the purposes set forth below.

 

AGREEMENT

 

NOW, THEREFORE, in
consideration of the premises, the covenants, representations, warranties and agreements contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby covenant and agree as follows:

 

ARTICLE
1

Certain Definitions

 

1.1.          Definitions.
As used in this Agreement, all exhibits and schedules hereto and in any note, certificate, report or other Loan Documents made
or delivered pursuant to this Agreement, the following terms will have the meanings given such terms in Article One.

 

“Accounts”
means any “account,” as such term is defined in Chapter 9 of the Code, now owned or hereafter acquired by Borrower,
and, in any event, shall include, without limitation, each of the following, whether now owned or hereafter acquired by Borrower:
(a) all rights of Borrower to payment for goods sold or leased or services rendered, whether or not earned by performance, (b)
all accounts receivable of Borrower, (c) all rights of Borrower to receive any payment of money or other form of consideration,
(d) all security pledged, assigned, or granted to or held by Borrower to secure any of the foregoing, and (e) all guaranties of,
or indemnifications with respect to, any of the foregoing.

 

“Advance”
means any disbursement of an amount or amounts to be loaned by Bank to Borrower hereunder or the reborrowing of amounts previously
loaned hereunder.

 

“Advance Request”
means, as of the date of preparation, a certificate requesting an Advance (in a form acceptable to Bank) prepared and executed
by Borrower.

 

“Affiliate”
means, as to any Person, any other Person (a) that directly or indirectly, through one or more intermediaries, controls or is controlled
by, or is under common control with, such Person, (b) that directly or indirectly beneficially owns or holds ten percent (10%)
or more of any class of voting stock of such Person, or (c) ten percent (10%) or more of the voting stock of which is directly
or indirectly beneficially owned or held by the Person in question. The term “control” means the possession, directly
or indirectly, of the power to direct or cause direction of the management and policies of a Person, whether through the ownership
of voting securities, by control, or otherwise; provided, however, in no event shall Bank be deemed an Affiliate
of Borrower.

 

    	Loan Agreement	Page 1

    	 

    

 

“Agreement”
means this Loan Agreement, as the same may, from time to time, be amended, supplemented, or replaced.

 

“Allonge”
means an allonge to a Mortgage Note in the form of allonge attached hereto as Exhibit D executed by Borrower in favor
of Bank.

 

“Approved
Purposes” means Borrower’s making Lot Development Loans to Lot Development Loan Obligors and Borrower’s making
Finished Lot Loans to Finished Lot Loan Obligors, all in accordance with the terms and conditions of this Agreement.

 

“Article”
and “Articles” have the meanings set forth in Section 11.2.

 

“Assignment
of Notes and Liens” means Collateral Assignment of Notes and Liens and Security Agreement executed, only upon Bank’s
request, in connection with each Mortgage Loan from Borrower assigning to Bank and granting Bank a first priority security interest
in certain Mortgage Paper, all in form, scope and substance satisfactory to Bank and in form and substance of Exhibit E
hereto, as the same may be amended, supplemented and modified from time to time with the prior written consent of Bank.

 

“Bank”
means VERITEX COMMUNITY BANK, and its successors and assigns.

 

“Bankruptcy
Code” means Title 11 of the United States Code entitled “Bankruptcy” as now or hereafter in effect, or as
successor thereto or any other present or future bankruptcy or insolvency statute.

 

“Borrower”
means the Person identified as such in the introductory paragraph hereof, and its successors and assigns.

 

“Borrowing
Base” means, at any time, an amount equal to the sum of the amounts calculated separately for each Eligible Mortgage
Loan being an amount equal to the lesser of (a) fifty percent (50%) of the unpaid principal balance of the Eligible Mortgage Loan
as of the date of calculation or (b) forty-two and fifty one-hundredths percent (42.50%) of the appraised value of the Finished
Lot or the Lot Development, as applicable, subject to the Mortgage securing the Eligible Mortgage Loan as of the date of calculation,
based upon the most recent appraisal ordered, received and approved by Bank. Any Eligible Mortgage Loan shall have the Borrowing
Base determined by Bank in connection with the Submission Package submitted by Borrower. In the case of a Lot Development Loan,
the appraised value will be the discounted lot appraised value. In the case of a Finished Lot Loan, the appraised value will be
the bulk sale discounted appraisal.

 

“Borrowing
Base Certificate” means, as of any date of preparation, a certificate setting forth the Borrowing Base in substantially
the form of Exhibit A attached hereto, prepared and certified by Borrower.

 

“Borrowing
Limit” means the lesser of (a) the Borrowing Base for all Eligible Mortgage Loans approved by Bank and (b) the Committed
Sum.

 

“Business
Day” means a day other than a Saturday, Sunday or a day on which commercial banks in Dallas, Texas, are authorized to
be closed. Unless otherwise provided, the term “days” means calendar days.

 

“Capital Lease
Obligation” means, with respect to any Person, the amount of Debt under a lease of property by such Person that would
be shown as a liability on a balance sheet of such Person prepared for financial reporting purposes in accordance with GAAP, or
other method of accounting acceptable to Bank.

 

    	Loan Agreement	Page 2

    	 

    

 

“Change in
Control” means the acquisition of equity of the Borrower resulting in the beneficial ownership by the acquiring person
of fifty percent (50%) or more of the equity of the Borrower, occurring by means of any transaction or series of related transactions,
including, without limitation, any reorganization, sale of securities, merger, exchange or consolidation.

 

“Closing Date”
means November 14, 2014.

 

“Code”
means the Uniform Commercial Code of the State of Texas or other applicable jurisdiction as it may be amended from time to time.

 

“Collateral”
means all property which secures, either directly or indirectly, the payment and performance of the Indebtedness and the Obligations
and are all assets of Borrower, including, without limitation, all Mortgage Loans and the Mortgage Paper executed in connection
therewith which have been assigned to Bank by Borrower, all Accounts, Equipment, Inventory and the Other Collateral, wherever located,
in which Borrower now has or at any time hereafter has or acquires any right, title or interest, and all Proceeds and products
thereof, together with all books and records, customer lists, credit files, computer files, programs, printouts and other computer
materials and records related thereto.

 

“Commitment”
means the obligation of Bank to make the Loans in an aggregate principal amount at any time outstanding up to but not to exceed
in the aggregate the Borrowing Limit in effect from time to time.

 

“Commitment
Fee” means One Hundred Thousand and No/100 Dollars ($100,000.00).

 

“Committed
Sum” means Ten Million and No/100 Dollars ($10,000,000.00).

 

“Compliance
Certificate” means a certificate, substantially in the form of Exhibit B attached hereto, prepared and executed
by Borrower.

 

“Debt”
means with respect to any Person at any time (without duplication), (a) all obligations of such Person for borrowed money; (b)
all obligations of such Person evidenced by bonds, notes, debentures, or other similar instruments; (c) all obligations of such
Person to pay the deferred purchase price of property or services, except trade accounts payable of such Person arising in the
ordinary course of business that are not past due by more than ninety (90) days; (d) all Capital Lease Obligations of such Person;
(e) all Debt or other obligations of others guaranteed by such Person; (f) all obligations secured by a Lien existing on property
owned by such Person, whether or not the obligations secured thereby have been assumed by such Person or are non-recourse to the
credit of such Person; (g) any other obligation for borrowed money or other financial accommodations which in accordance with GAAP,
or other method of accounting acceptable to Bank, would be shown as a liability on the balance sheet of such Person; (h) any repurchase
obligation or liability of a Person with respect to accounts, chattel paper or notes receivable sold by such Person; (i) any liability
under a sale and leaseback transaction that is not a Capital Lease Obligation; (j) any obligation arising with respect to any other
transaction that is the functional equivalent of borrowing but which does not constitute a liability on the balance sheets of a
Person; (k) all payment and reimbursement obligations of such Person (whether contingent or otherwise) in respect of letters of
credit, bankers’ acceptances, surety or other bonds and similar instruments; and (l) all obligations of such Person to purchase,
redeem, retire, defease or otherwise make any payment in respect of any equity interests in such Person or any other Person, valued,
in the case of redeemable preferred stock interests, at the greater of its voluntary or involuntary liquidation preference plus
all accrued and unpaid dividends.

 

“Debtor Relief
Laws” means the Bankruptcy Code and all other applicable liquidation, conservatorship, bankruptcy, moratorium, rearrangement,
insolvency, reorganization, or similar debtor relief Laws affecting the rights of creditors generally from time to time in effect.

 

    	Loan Agreement	Page 3

    	 

    

 

“Default”
shall mean any event occurred which, with the giving of notice or lapse of time or both, would reasonably be expected to constitute
such an Event of Default under the Loan Documents.

 

“Default Interest
Rate” has the meaning assigned to that term in the Note.

 

“Depository
Account” shall have the meaning assigned to that term in Section 2.9.

 

“Eligible
Mortgage Loans” means at any time any Mortgage Loan created in the ordinary course of business acceptable to Bank (in
its sole and absolute discretion) and satisfying the following requirements and conditions and continues to do so until paid in
full:

 

(a)          The
Mortgage Paper relating to the Mortgage Loan is effectively assigned and pledged to Bank and in respect of which Bank has a first
perfected Lien not subject to any other Liens or claims of any kind;

 

(b)          The
original executed Mortgage Note and an executed copy of the Mortgage relating to the Mortgage Loan and copies of all other Mortgage
Paper related to the Mortgage Loan have been delivered to Bank and the original Mortgage Note has been endorsed payable to the
order of Bank pursuant to an Allonge executed by Borrower;

 

(c)          Bank
has received and approved the appraisal ordered by Bank relating to the Finished Lot or Lot Development Property subject to the
Mortgage securing the Mortgage Loan and the appraised value set forth in the appraisal is acceptable to Bank;

 

(d)          The
Mortgage Loan is collateralized by real property located in a municipality and subdivision approved by Bank (and in any event located
in the Texas metropolitan markets of Dallas-Fort Worth, Houston, San Antonio and Austin) and any builder or third party purchasing
or refinancing a Finished Lot and any developer or third party involved in the completing the Lot Development has been approved
by Bank;

 

(e)          The
Mortgage Loan is secured by a first and prior deed of trust lien encumbering a Finished Lot or Lot Development Property, as applicable;

 

(f)          The
Mortgage Loan has a lot sales contract approved by Bank and such lot sales contract is still in full force and effect and there
are no defaults thereunder;

 

(g)          The
Mortgage Loan is not secured by a “contract for deed”;

 

(h)          The
Mortgage Loan is current with respect to all scheduled payments of principal and accrued interest and no event of default exists
thereunder;

 

(i)          The
Mortgage Paper relating to the Mortgage Loan has not been altered, modified or amended in any manner except for modifications approved
by Bank (including, without limitation, modified or amended to waive or defer any scheduled payment thereunder);

 

(j)          If
the Mortgage Loan is a Lot Development Loan, the Mortgage Note evidencing the Mortgage Loan has not been outstanding for more than
thirty-six (36) months from its Origination Date (as hereinafter defined) and the Lot Development Loan Obligors have begun Lot
Development within twelve (12) months from its Origination Date; provided, however, when a Lot Development Loan reaches “substantial
completion” or “completion” under and as defined in the applicable Mortgage Paper for such Mortgage Loan then
provided no Event of Default has occurred then such Mortgage Loan shall convert to a Finished Lot Loan and thereafter shall be
required to comply with subparagraph (k) below (with the Origination Date being the first approval of an Advance as a Lot Development
Loan not from the date of conversion to a Finished Lot Loan) and all other requirements applicable to Finished Lot Loans;

 

    	Loan Agreement	Page 4

    	 

    

  

(k)          If the Mortgage Loan is a Finished Lot Loan, the Mortgage Note evidencing the Mortgage Loan has not been
outstanding for more than eighteen (18) months from the date Bank first approves an Advance Request for such Mortgage Loan (each an “Origination Date”);

 

(l)          If
the Mortgage Loan is a Lot Development Loan the outstanding principal amount of the Mortgage Loan does not exceed an amount equal
to one hundred percent (100%) of the acquisition cost of the Lot Development Property and the construction costs associated with
the Lot Development securing the Mortgage Loan, as reflected in the budget prepared in connection with the Lot Development and
delivered to and approved by Bank (the “Lot Development Budget”);

 

(m)          Each
of the related Mortgage Note and Mortgage relating to the Mortgage Loan is genuine and is the legal, valid, binding and enforceable
obligation of a Mortgage Loan Obligor, not subject to a right of rescission, set-off, counterclaim or defense;

 

(n)          The
Mortgage Note relating to the Mortgage Loan has not been extinguished under relevant state law in connection with a judgment of
foreclosure, foreclosure sale, deed-in-lieu of foreclosure or otherwise;

 

(o)          The
Mortgage relating to the Mortgage Loan is insured as a first and prior lien on the mortgaged property covered thereby by a loan
policy of title insurance, issued by a title insurance company acceptable to Bank in an amount not less than the original principal
amount of the Mortgage Note secured thereby;

 

(p)          The
mortgaged property subject to the Mortgage relating to the Mortgage Loan is not the subject to a foreclosure or receivership proceeding
or similar action;

 

(q)          The
Mortgage Loan Obligor and/or any guarantor of the Mortgage Loan is not subject to a bankruptcy or insolvency proceeding;

 

(r)          There
is no litigation, proceeding or governmental investigation pending or threatened, or any order, injunction or decree outstanding,
existing or relating to the Mortgage Loan, the collateral securing the Mortgage Loan or Borrower;

 

(s)          Bank
has provided Borrower with written notice that it has reviewed and approved the Submission Package for the Mortgage Loan;

 

(t)          The
Mortgage Loan was originated by Borrower unless otherwise approved in writing by Bank; and

 

(u)          If
the Mortgage Loan is a Lot Development Loan, construction of the Lot Development subject to the Mortgage securing the Mortgage
Loan has commenced and is being prosecuted with diligence and continuity in accordance with the plans and specifications and all
applicable law.

 

“Eligible
Mortgage Approval Letter” shall have the meaning set forth in Section 2.1 of this Agreement.

 

“Eligible
Mortgage Paper” means all Mortgage Paper relating to Eligible Mortgage Loans.

 

    	Loan Agreement	Page 5

    	 

    

 

“Environmental
Laws” means any and all federal, state, and local laws, regulations, judicial decisions, orders, decrees, plans, rules,
permits, licenses, and other governmental restrictions and requirements pertaining to health, safety, or the environment, including,
without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. § 9601, et
seq., the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 6901, et seq., the Occupational Safety and
Health Act, 29 U.S.C. § 651, et seq., the Clean Air Act, 42 U.S.C. § 7401 et seq., the Clean Water Act,
33 U.S.C. § 1251, et seq., and the Toxic Substances Control Act, 15 U.S.C. § 2601, et seq., as the same
may be amended or supplemented from time to time.

 

“Environmental
Liabilities” means, as to any Person, all liabilities, obligations, responsibilities, Remedial Actions, losses, damages,
punitive damages, consequential damages, treble damages, costs, and expenses (including, without limitation, all reasonable fees,
disbursements and expenses of counsel, expert and consulting fees and costs of investigation and feasibility studies), fines, penalties,
sanctions, and interest incurred as a result of any claim or demand, by any Person, whether based in contract, tort, implied or
express warranty, strict liability, criminal or civil statute, including any Environmental Law, permit, order or agreement with
any Governmental Authority or other Person, arising from environmental, health or safety conditions or the Release or threatened
Release of a Hazardous Material into the environment, resulting from the past, present, or future operations of such Person or
its Affiliates.

 

“Equipment”
means any “equipment,” as such term is defined in Chapter 9 of the Code, now owned or hereafter acquired by Borrower
and, in any event, shall include, without limitation, all machinery, equipment, furnishings, fixtures and vehicles now owned or
hereafter acquired by Borrower and any and all additions, substitutions, and replacements of any of the foregoing, wherever located,
together with all attachments, components, parts, equipment, and accessories installed thereon or affixed thereto.

 

“Event of
Default” has the meaning set forth in Article Nine of this Loan Agreement.

 

“Finished
Lot” means an entire unimproved but fully developed and platted single family residential lot.

 

“Finished
Lot Loan” means a loan by Borrower to a Finished Lot Loan Obligor to enable such Finished Loan Obligor to acquire or
finance a Finished Lot in a subdivision located in the State of Texas approved by Bank in writing.

 

“Finished
Lot Loan Obligors” means those Persons submitted by Borrower to Bank for approval as Finished Lot Loan Obligors and,
after receipt and review of all financial, background and other information requested by Bank relating to such Persons, have been
approved by Bank (in its sole and absolute discretion) in writing as finished Lot Loan Obligors for purposes of this Agreement.

 

“GAAP”
means generally accepted accounting principles, applied on a consistent basis, set forth in Opinions of the Accounting Principles
Board of the American Institute of Certified Public Accountants and/or in statements of the Financial Accounting Standards Board
which are applicable under the circumstances and in effect as of the date in question; provided, that the phrase “applied
on a consistent basis” means that the accounting principles applied in the current period be comparable in all material respects
to those applied in preceding periods, except to the extent that a deviation therefrom is expressly permitted by this Agreement.

 

“Guarantor”
means any Person who from time to time guarantees all or any part of the Indebtedness.

 

“Guaranty”
means a written guaranty of each Guarantor in favor of Bank, if any, in form and substance satisfactory to Bank, as the same may
be amended, modified, restated, renewed, replaced, extended, supplemented or otherwise changed from time to time.

 

    	Loan Agreement	Page 6

    	 

    

 

“Hazardous
Material” means any substance, product, waste, pollutant, material, chemical, contaminant, constituent, or other material
which is or becomes listed, regulated, or addressed under any Environmental Law, including, without limitation, asbestos, petroleum,
and polychlorinated biphenyls.

 

“Inchoate
Lien” means any Tax Lien for Taxes not yet due and payable and any mechanic’s Lien and materialman’s Lien
for services or materials for which payment is not yet due.

 

“Indebtedness”
means all present and future indebtedness, obligations, and liabilities of Borrower to Bank, including all direct and contingent
obligations arising under letters of credit, banker’s acceptances, bank guaranties and similar instruments, overdrafts, Automated
Clearing House obligations, and all other financial accommodations which could be considered a liability under GAAP, or other method
of accounting acceptable to Bank, and all renewals, extensions, and modifications thereof, or any part thereof, now or hereafter
owed to Bank by Borrower, and all interest accruing thereon and costs, expenses, and reasonable attorneys’ fees incurred
in the enforcement or collection thereof, regardless of whether such indebtedness, obligation, and liabilities are direct, indirect,
fixed, contingent, liquidated, unliquidated, joint, several, or joint and several, including, but not limited to, the indebtedness,
obligations, and liabilities evidenced, secured, or arising pursuant to any of the Loan Documents and all renewals and extensions
thereof, or any part thereof, and all present and future amendments thereto.

 

“Inventory”
means any “inventory,” as such term is defined in Chapter 9 of the Code, now owned or hereafter acquired by Borrower,
and, in any event, shall include, without limitation, each of the following, whether now owned or hereafter acquired by Borrower:
(a) all goods and other personal property of Borrower that are held for sale or lease or to be furnished under any contract of
service, (b) all raw materials, work-in-progress, finished goods, inventor, supplies, and materials of Borrower, and (c) all goods
that have been returned to, repossessed by, or stopped in transit by Borrower.

 

“Laws”
means all statutes, laws, ordinances, regulations, orders, writs, injunctions, or decrees of the United States, any city or municipality,
state, commonwealth, nation, country, territory, possession, or any Tribunal.

 

“Leases”
means those certain lease agreements between the owners of the real property on which any part of Borrower’s business is
operated, as landlord, and Borrower, as tenant, pertaining to the lease of such real property.

 

“Lender”
shall mean Bank.

 

“Leverage
Ratio” means, in respect of a Person and as of any date of computation, the ratio of (a) Liabilities to (b) Tangible
Net Worth.

 

“Liabilities”
means, at any particular time, all amounts which in conformity with GAAP, or other method of accounting acceptable to Bank, would
be included as liabilities on a balance sheet of a Person.

 

“Lien”
means any lien, security interest, Tax lien, mechanic’s lien, materialman’s lien, or other encumbrance, whether arising
by contract or under Law.

 

“Litigation”
means any proceeding, claim, lawsuit, and/or investigation conducted or threatened by or before any Tribunal, including, but not
limited to, proceedings, claims, lawsuits, and/or investigations under or pursuant to any environmental, occupational safety and
health, antitrust, unfair competition, securities, Tax, or other Law, or under or pursuant to any agreement, document, or instrument.

 

“Loan Documents”
mean this Agreement, the Note, the Guaranty, the Security Documents, and any and all other agreements, documents, and instruments
executed and delivered pursuant to the terms of this Agreement, and any future amendments hereto, or restatements hereof, or pursuant
to the terms of any of the other loan documents, together with any and all renewals, extensions, and restatements of, and amendments
and modifications to, any such agreements, documents, and instruments.

 

    	Loan Agreement	Page 7

    	 

    

 

“Loan”
or “Loans” has the meaning set forth in Section 2.1.

 

“Lockbox”
shall have the meaning set forth in Section 2.9.

 

“Lot Development”
means (i) improvements which are to be constructed (including, without limitation, streets, curbs, grading, landscaping, sprinklers,
storm and sanitary sewers, paving, sidewalks, and utilities) necessary to make the Lot Development Property able to be platted
and suitable for the construction of single family homes, and any common area improvements for the subdivision which may exist
or which are to be constructed, together with the associated fixtures and other tangible personal property located or used in or
on land on which such improvements are constructed, and (ii) entitlements which are to be obtained from existing or future contracts
or agreements with a district, city, county, water district, municipal utility district, public improvement district, or other
governmental authority providing for the sharing, payment and/or reimbursement of the costs of planning, development and/or construction
with respect to the Lot Development Property such as, but not limited to, a municipal utility district or public improvement district
reimbursement agreement, all of which must be approved by Bank pursuant to the Lot Development Budget and the plans.

 

“Lot Development
Loan” means a loan made by Borrower to a Lot Development Obligor to enable such Lot Development Obligor to complete a
Lot Development on Lot Development Property in the State of Texas approved in writing by the Bank.

 

“Lot Development
Loan Obligors” means those Persons submitted by Borrower to Bank for approval as a Lot Development Loan Obligor, and
after receipt and review of all financial, background, and other information requested by Bank relating to such Persons, have been
approved by Bank (in its sole and absolute discretion) in writing as Lot Development Loan Obligors for purposes of this Agreement.

 

“Lot Development
Property” the certain real property in a location approved by Bank on which the Lot Development will be completed and
which will be the subject of the Lot Development Loan.

 

“Material
Adverse Effect” means any set of circumstances or events which with respect to Borrower or any other Obligated Party
which (a) could reasonably be expected to have a material adverse effect upon the validity, performance, or enforceability of any
Loan Document against Borrower or any other Obligated Party, (b) is or could reasonably be expected to have a material adverse
effect upon the condition (financial or otherwise), properties, liabilities (actual or contingent), business operations or prospects
of Borrower or any other Obligated Party, (c) could reasonably be expected to materially impair the ability of Borrower or any
other Obligated Party to pay the Indebtedness or to fulfill the Obligations under the Loan Documents, (d) could reasonably be expected
to cause an Event of Default, or (e) could reasonably be expected to have any material adverse effect on the priority of the Liens
under any of the Loan Documents.

 

“Maximum Rate”
means the maximum non-usurious rate of interest (or, if the context so requires, an amount calculated at such rate) which Bank
is allowed to contract for, charge, take, reserve, or receive in this transaction under applicable federal or state (whichever
is higher) Law from time to time in effect after taking into account, to the extent required by applicable federal or state (whichever
is higher) Law from time to time in effect, any and all relevant payments or charges under the Loan Documents.

 

“Mortgage”
means a recorded first lien deed of trust, on a standard form and in form and substance satisfactory to Bank, in its sole and absolute
discretion, securing a Mortgage Note and granting a perfected first priority lien to Borrower on a Finished Lot or Lot Development
Property, as applicable.

 

    	Loan Agreement	Page 8

    	 

    

 

“Mortgage
Assignment” means an instrument duly executed by Borrower, upon Bank’s request, and in recordable form assigning
the Mortgage Paper related to a Mortgage Loan, to Bank and all like intervening instruments that have been executed with respect
to such Mortgage Loan and which is in form and substance of Exhibit C hereto.

 

“Mortgage
Collateral” all Mortgage Notes (a) which are made payable to the order of Borrower or have been endorsed (without restriction
or limitation) payable to the order of Borrower, (b) which have been assigned to Bank and in which Bank has been granted and continues
to hold a perfected first priority security interest, (c) which are in form and substance acceptable to Bank in its sole and absolute
discretion, (d) and which are secured by Mortgages.

 

“Mortgage
Loan” means a Finished Lot Loan or a Lot Development Loan which, in each instance, is evidenced by a Mortgage Note and
secured by a Mortgage, together with the rights of a holder thereof and payments thereon and proceeds therefrom.

 

“Mortgage
Loan Obligors” means the Finished Lot Loan Obligors and the Lot Development Loan Obligors.

 

“Mortgage
Note” means a promissory note or other evidence of indebtedness evidencing the indebtedness of Mortgage Loan Obligor
under a Mortgage Loan, which is in form and substance acceptable to Bank, in its sole and absolute discretion, including, without
limitation, the loan policy of title insurance, the appraisal, and, with respect to a Lot Development Loan, the budget and the
plans for the Lot Development relating to such Mortgage Loan.

 

“Mortgage
Paper” with respect to each Mortgage Loan, shall at a minimum be the Mortgage Note, the Mortgage, a guaranty agreement
(each a “Mortgage Guaranty”), environmental indemnity agreement executed by the Mortgage Loan Obligor and the
guarantor of the Mortgage Loan, if any (each a “Mortgage Environmental Indemnity”), the loan policy of title
insurance (each a “Mortgage Policy”), the appraisal, the budget, and the plans for the Lot Development if the Mortgage
Loan is a Lot Development Loan, all of such documents being subject to Bank’s review and approval (in its sole and absolute
discretion) and all other documents, instruments and agreements relating to such Mortgage Loan.

 

“Note”
means the promissory note, dated the Closing Date, in the original principal amount of Ten Million and No/100 Dollars ($10,000,000.00)
executed by Borrower and payable to the order of Bank, in form and substance satisfactory to Bank, and all renewals, amendments,
extensions, replacements, increases and modifications thereof.

 

“Obligated
Party” means Borrower, each Guarantor or any other Person who is or becomes party to any agreement that guarantees or
secures payment and performance of the Indebtedness and/or the Obligations or any part thereof.

 

“Obligations”
means any and all of the covenants, conditions, warranties, representations and other obligations (other than to repay the Indebtedness)
made or undertaken by Borrower or any other Obligated Party to Bank as set forth in the Loan Documents.

 

“Other Collateral”
means all of Borrower’s present and future chattel paper, instruments, commercial tort claims, deposit accounts, documents,
fixtures, general intangibles, intellectual property, instruments, financial assets, investment property and letter of credit rights.

 

“Organizational
Documents” means (a) in the case of a corporation, its articles or certificate of incorporation and bylaws, (b) in the
case of a general partnership, its partnership agreement, (c) in the case of a limited partnership, its certificate of limited
partnership and partnership agreement, (d) in the case of a limited liability company, its articles of organization and operating
agreement or regulations, and (e) in the case of any other entity, its organizational and governance documents and agreements.
In the event the Organizational Documents show the Borrower or Guarantor are organized in a state other than Texas then the term
Organizational Documents shall be required to include certificates of authority issued by the Secretary of State of the State of
Texas.

 

    	Loan Agreement	Page 9

    	 

    

 

“Permitted
Businesses” mean, with respect to Borrower, the making and holding of Mortgage Loans.

 

“Permitted
Liens” means all (a) Inchoate Liens, (b) Liens created by or pursuant to the Loan Documents in favor of Bank, (c) all
Liens described in Schedule Two, and all renewals and extensions of the foregoing.

 

“Person”
means any individual, firm, corporation, limited liability company, association, partnership, joint venture, trust, other entity,
or a Tribunal.

 

“Principal
Balance” means the aggregate unpaid principal balance of the Note on any date of determination.

 

“Proceeds”
means any “proceeds,” as such term is defined in Chapter 9 of the Code and, in any event, shall include, but not be
limited to, (a) any and all proceeds of any insurance, indemnity, warranty, or guaranty payable to Borrower from time to time with
respect to any of the Collateral, (b) any and all payments (in any form whatsoever) made or due and payable to Borrower from time
to time in connection with any requisition, confiscation, condemnation, seizure, or forfeiture of all or any part of the Collateral
by any Tribunal (or any person acting under color of Tribunal), and (c) any and all other amounts from time to time paid or payable
under or in connection with any of the Collateral.

 

“Release”
means, as to any Person, any release, spill, emissions, leaking, pumping, injection, deposit, disposal, disbursement, leaching,
or migration of Hazardous Materials into the indoor or outdoor environment or into or out of property owned by such Person, including,
without limitation, the movement of Hazardous Materials through or in the air, soil, surface water, ground water, or property.

 

“Remedial
Action” means all actions required to (a) clean up, remove, treat, or otherwise address Hazardous Materials in the indoor
or outdoor environment, (b) prevent the Release or threat of Release or minimize the further Release of Hazardous Materials so
that they do not migrate or endanger or threaten to endanger public health or welfare or the indoor or outdoor environment, or
(c) perform pre-remedial studies and investigations and post-remedial monitoring and care.

 

“Rights”
mean any remedies, powers, and privileges exercisable by Bank under the Loan Documents, at Law, equity, or otherwise.

 

“Section”
and “Sections” have the meanings set forth in Section 11.2.

 

“Security
Agreement” means the Pledge and Security Agreement dated as of the Closing Date, executed by Borrower in favor of Bank,
in form and substance satisfactory to Bank (in its sole and absolute discretion), as the same may be amended, restated, supplemented
or modified from time to time.

 

“Security
Documents” means this Agreement, the Assignment of Notes and Liens, the Security Agreement, each Mortgage Assignment,
each Guaranty, and each other pledge agreement, security agreement or similar agreement or document required by or delivered to
Bank from time to time that purports to create a Lien in favor of any of Bank to secure payment or performance of Indebtedness
and/or Obligations or any portion thereof.

 

“Subsection”
and “Subsections” have the meanings set forth in Section 11.2.

 

    	Loan Agreement	Page 10

    	 

    

 

“Subsidiary(ies)”
means any entity more than fifty percent (50%) of whose ownership, equity or voting interest now or hereafter is owned directly
or indirectly by Borrower or any Subsidiary or may be voted by Borrower or any Subsidiary.

 

“Tangible
Net Worth” means, for any Person at any particular time, all amounts which, in conformity with GAAP, or other method
of accounting acceptable to Bank, would be included as owner’s equity on a balance sheet of a Person; but excluding all assets
which are properly classified as intangible assets.

 

“Taxes”
means all taxes (including withholding), assessments, fees, levies, imposts, duties, deductions, withholdings, or other charges
of any nature whatsoever from time to time or at any time imposed by any Laws or by any Tribunal, excluding state and local sales
and use taxes.

 

“Tribunal”
means any state, commonwealth, federal, foreign, territorial, or other court or governmental department, commission, board, bureau,
agency, or instrumentality.

 

“Tribunal
Proceedings” has the meaning set forth in Section 5.4.

 

“Unit”
means a Finished Lot, and any improvements located on or to be located thereon, and all rights, estates, and benefits appurtenant
thereto.

 

1.2.          Accounting
Matters. Any accounting term used in this Agreement or the other Loan Documents shall have, unless otherwise specifically provided
therein, the meaning customarily given such term in accordance with GAAP, or other method of accounting acceptable to Bank, and
all financial computations thereunder shall be computed, unless otherwise specifically provided therein, in accordance with GAAP,
or other method of accounting acceptable to Bank, consistently applied. That certain items or computations are explicitly modified
by the phrase “in accordance with GAAP, or other method of accounting acceptable to Bank” shall in no way be construed
to limit the foregoing.

 

1.3.          Headings.
The headings, captions, and arrangements used in any of the Loan Documents are, unless specified otherwise, for convenience only
and shall not be deemed to limit, amplify, or modify the terms of the Loan Documents no to affect the meaning thereof.

 

1.4.          Number
and Gender of Words. Whenever herein the singular number is used, the same shall include the plural where appropriate, and
words of any gender shall include each other gender where appropriate. Reference herein to Borrower shall mean, jointly and severally,
each Person comprising same.

 

1.5.          Articles,
Sections and Exhibits. All references herein to “Articles” and “Sections” are, unless specified otherwise,
references to articles and sections of this Agreement. All references herein to an “Exhibit” or “Schedule”
are references to exhibits or schedules attached hereto, all of which are made a part hereof for all purposes, the same as if set
forth herein verbatim, it being understood that if any exhibit or schedule attached hereto which is to be executed and delivered,
contains blanks, the same shall be completed correctly and in accordance with the terms and provisions contained and as contemplated
herein prior to or at the time of the execution and delivery thereof. The words “herein,” “hereof,” “hereunder”
and other similar compounds of the word “here” when used in this Agreement shall refer to the entire Agreement and
not to any particular provision or section.

 

    	Loan Agreement	Page 11

    	 

    

  

ARTICLE
2

Commitment to Lend, Terms of Payment

 

2.1.          Loans.
In the event Borrower desires Bank to make Advances to Borrower in connection with a proposed Eligible Mortgage Loan, no sooner
than ten (10) days prior to the date when Borrower would like an Advance for any Mortgage Loan (or such longer amount of time necessary
to obtain any third party reports or appraisals required by Bank), Borrower shall submit to Bank a comprehensive underwriting package
in connection with such proposed Eligible Mortgage Loan for Bank’s consideration (each a “Submission Package”).
Such Submission Package shall, to the extent applicable or available, include an Advance Request, Borrowing Base Certificate, appraisal,
detailed budget, plans for the Lot Development (if a Lot Development Loan), lot sales contract or similar agreement, title commitment
for the Mortgage Policy together with all endorsements that will be issued to Borrower, the Mortgage Paper (including, without
limitation, a Mortgage Guaranty from a guarantor acceptable to Bank) which, among other things, shows the maximum loan amount of
the Mortgage Loan, the final closing statement for the Mortgage Loan, environmental reports, soils reports, inventory reports,
market reports, zoning verification, insurance certificates, the recorded plat showing the municipality and subdivision where the
Finished Lot is located, financial statements and tax returns for the Mortgage Loan Obligors and the guarantor for the Mortgage
Loan, any other information required on the builder involved in the Mortgage Loan, and all information necessary for Lender to
determine the Borrowing Base for such proposed Eligible Mortgage Loan. Borrower shall also submit such other information as Bank
shall request in connection with such proposal. In the event Bank approves of such proposed Eligible Mortgage Loan, such Eligible
Mortgage Loan shall be eligible for one or more Advances under this Agreement in accordance with the approved budget and Borrowing
Base approved by Lender up to the Borrowing Limit and in accordance with the terms of the Eligible Mortgage Loan Approval Letter
(as hereinafter defined). Notwithstanding anything contained in this Agreement to the contrary, Lender shall not be obligated to
approve any proposed Mortgage Loan or Eligible Mortgage Loan and may disapprove any Mortgage Loan or Eligible Mortgage Loan in
its sole and absolute discretion for any reason or for no reason (including, without limitation, in the event Bank does not approve
the subdivision, the builder, the guarantor, the loan amount of the Mortgage Loan, or any other reason). Notwithstanding the face
amount of the Note or the maximum Borrowing Base set forth in this Agreement, nothing contained herein shall obligate Lender to
approve Projects and Borrowing Bases up to such amounts. In the event Bank approves an Advance Request and a Submission Package
then subject to the terms of this Agreement, Bank shall make one or more Advances (hereinafter called, individually, a “Loan”
and, collectively, the “Loans”) to Borrower for Approved Purposes in an aggregate principal amount at any one
time outstanding up to but not exceeding the Borrowing Limit in accordance with an Eligible Mortgage
Loan Approval Letter (herein so called) which will be executed and delivered by Borrower and Lender setting forth the specific
terms for the Loan (including, without limitation, the aggregate Advances available, the repayment terms applicable to the Loan,
the partial release prices for the collateral secured by the Mortgage and the approved lot purchaser and lot sales contract) in
accordance with an Eligible Mortgage Loan Approval Letter (herein so called) which will be executed and delivered by Borrower and
Lender setting forth the specific terms for the Loan (including, without limitation, the aggregate Advances available, the repayment
terms applicable to the Loan, the partial release prices for the collateral secured by the Mortgage and the approved lot purchaser
and lot sales contract). In no event shall Lender ever be obligated to make Advances in excess of Five Million and No/100
Dollars ($5,000,000.00) with respect to Eligible Mortgage Loans where the Mortgage Loan Obligors are affiliated, controlled by
the same group or under common control or have the same principals, all as determined by Lender (the “Related Borrower Funding
Limitation”). Within the limit of the Borrowing Limit in effect from time to time, Borrower may borrow, repay, and reborrow
at any time and from time to time from the Closing Date to the earlier of (a) the maturity date of the Note, or (b) the termination
of Bank’s Commitment hereunder. If, by virtue of payments made on the Note, the principal amount owed on the Note during
its term reaches zero at any point, Borrower agrees that all of the Collateral and all of the Loan Documents shall remain in full
force and effect to secure any Advances made thereafter, and Bank shall be fully entitled to rely on all of the Collateral and
all of the Loan Documents unless an appropriate release of all or any part of the Collateral or all or any part of the Loan Documents
has been executed by Bank and recorded in the applicable real property or UCC records. The Principal Balance may not exceed the
Borrowing Limit at any time. Borrower shall maintain the outstanding principal balance of the Note in such a manner as to not exceed
the Borrowing Base for each Eligible Mortgage Loan and the Borrowing Limit and Borrower shall be required to make prepayments of
the principal balance of the Loan so that the Principal Balance and the maximum Borrowing Base for each Mortgage Loan in question
(and the aggregate Borrowing Limit) is in compliance with the requirements and limitations of this Agreement. In the event Bank
makes an Advance on an Eligible Mortgage Loan and then the Mortgage Loan is no longer classified as an Eligible Mortgage Loan then
within ten (10) days Borrower shall pay to Bank all Advances made by Bank in connection with such Mortgage Loan which remain outstanding
or, if Bank approves (in its sole and absolute discretion), provide Bank with a substitute Eligible Mortgage Loan to replace the
Mortgage Loan that is no longer classified by an Eligible Mortgage Loan.

 

    	Loan Agreement	Page 12

    	 

    

  

2.2.          Note.
The Loans shall be evidenced by, be repayable, and accrue interest in accordance with, the Note. Subject to the terms and conditions
in this Agreement, the Note, and the other Loan Documents, Borrower may borrow, repay, and reborrow under the Note. The unpaid
principal balance of the Note shall be repaid as provided therein and in this Agreement.

 

2.3.          Borrowing
Procedure. Once Bank approves an Eligible Mortgage Loan, Borrower shall give Bank notice of each Loan by means of a written
request containing the information required by Bank and delivered (by hand or by mechanically confirmed facsimile) to Bank no later
than 1:00 p.m. (Texas time) on the day on which the Loan is desired to be funded; provided, however, Bank shall not fund Advances
more than biweekly. Bank, at its option, may accept telephonic requests for such Advances, provided that such acceptance
shall not constitute a waiver of Bank’s right to require delivery of a written request in connection with subsequent Loans.
Any telephonic request for a Loan by Borrower shall be promptly confirmed by submission of a properly completed written request
to Bank, but failure to deliver a written request shall not be a defense to payment of a Loan. Bank shall have no liability to
Borrower for any loss or damage suffered by Borrower as a result of Bank’s honoring of any requests, execution of any instructions,
authorizations or agreements or reliance on any reports communicated to it telephonically, by facsimile or electronically, and
purporting to have been sent to Bank by Borrower and Bank shall have no duty to verify the origin of any such communication or
the identity or authority of the Person sending it. Subject to the terms and conditions of this Agreement, each Loan shall be made
available to Borrower by depositing the same, in immediately available funds, in an account of Borrower designated by Borrower
maintained with Bank.

 

2.4.          Payments.
If a scheduled payment under the Note is not made in a timely manner, Bank is authorized by Borrower to debit the amount of any
such payments from the general deposit account of Borrower with Bank. If at any time the Principal Balance exceeds the Borrowing
Limit, Borrower shall immediately repay to Bank an amount sufficient to eliminate such excess.

 

2.5.          Purpose
of Loans. Borrower represents that the proceeds of the Loans will be used only for Approved Purposes.

 

2.6.          Sale
of Participations. Bank may, from time to time and without notice to Borrower, sell or offer to sell the Indebtedness, or interests
therein, to one or more assignees or participants and Bank is hereby authorized to disseminate and disclose any information (whether
or not confidential or proprietary in nature) Bank now has or may hereafter obtain pertaining to Borrower, the Indebtedness or
the Loan Documents (including, without limitation, any credit or other information regarding Borrower, any of its principals, or
any other person or entity liable, directly or indirectly, for any part of the Loan, to (a) any assignee or participant or any
prospective assignee or prospective participant, (b) any regulatory body having jurisdiction over Bank or the Indebtedness, and
(c) any other persons or entities as may be necessary or appropriate in Bank’s sole judgment). Bank, as a courtesy to Borrower,
will endeavor to notify Borrower of any such assignees or participants, or prospective assignees or participants, to which Bank
disseminates any of the information described above. Borrower may not sell any participation interests in any Mortgage Loan.

 

2.7.          Order
of Application. Except as otherwise provided in the Loan Documents or otherwise agreed by Bank, all payments and prepayments
of the Indebtedness, including proceeds from the exercise of any Rights under the Loan Documents or proceeds of any of the Collateral,
shall be applied to the Indebtedness in the following order, any instructions from Borrower to the contrary notwithstanding: (a) to
the expenses for which Bank shall not have been reimbursed under the Loan Documents, and then to all indemnified amounts due under
the Loan Documents; (b) to fees then owed Bank hereunder; (c) to accrued interest on the portion of the Indebtedness being paid
or prepaid; (d) to the portion of the principal being paid or prepaid; (e) to the remaining accrued interest on the Indebtedness;
(f) to the remaining principal; and (g) to the remaining Indebtedness. All amounts remaining after the foregoing application of
funds shall be paid to Borrower.

 

    	Loan Agreement	Page 13

    	 

    

  

2.8.          Commitment
Fee. Borrower shall pay to Bank the Commitment Fee for agreeing to make the Loans. The Commitment Fee shall be fully earned,
non-refundable and due and payable by Borrower to Bank on or before the Closing Date.

 

2.9.          Lockbox
and Account Collections. Upon the occurrence of Default or Event of Default and written request from Bank, Borrower will maintain
under such written agreements as Bank requires, as security for the Indebtedness, a lockbox (“Lockbox”) and
depository account held by Bank or another financial institution acceptable to Bank in the name of Bank (“Depository Account”).
All payments from the Mortgage Loan Obligors with respect to Mortgage Loans and for all other account debtors of Borrower will
be deposited directly into the Depository Account, and Bank is authorized to transfer to the Depository Account any funds which
are Mortgage Loan Obligors or other account debtor payments but which have been deposited into any other depository account of
Borrower at Bank. Borrower agrees that Bank will have all right, title and interest in and to all items and funds from time to
time in the Depository Account. Checks received into the Depository Account will not be considered good funds until Bank has effected
final settlement with respect thereto. After an Event of Default has occurred, Bank is authorized to apply any and all funds in
the Depository Account at any time, and from time to time, to the Indebtedness in any order Bank may elect.

 

Upon written notice
to Borrower from Bank, Borrower will advise the Mortgage Loan Obligors and all of its other account debtors to direct their payments
to the Lockbox (and if Borrower does not so advise Bank may advise such Mortgage Loan Obligors without the need of any further
consent by Borrower), at the address established by the Lockbox arrangements without any further consent by Borrower. All payments
received into the Lockbox will be deposited into the Depository Account for disposition as set forth above in this Section.

 

ARTICLE
3

Collateral

 

3.1.          Security
Interests. Borrower hereby pledges, assigns and grants to Bank a continuing first priority security interest in all of Borrower’s
right, title and interest in and to all of the Collateral to secure the prompt and complete payment and performance when due of
all of the Indebtedness and all of the Obligations.

 

3.2.          Borrower
Remains Liable. Notwithstanding anything to the contrary contained herein, (a) Borrower and each other Obligated Party shall
remain liable under the contracts and agreements to which such Person is a party and which are included in the Collateral and shall
perform all of its respective duties and obligations thereunder to the same extent as if this Agreement had not been executed,
and (b) Bank shall not have any obligation or liability under any of the contracts and agreements included in the Collateral by
reason of this Agreement, nor shall Bank be obligated to perform any of the obligations or duties of Borrower or any other Obligated
Party thereunder or to take any action to collect or enforce any claim for payment assigned hereunder.

 

3.3.          Authorization
to File Financing Statements. Borrower hereby irrevocably authorizes Bank at any time and from time to time to prepare and
file one or more financing statements (and any continuation statements and amendments thereto) describing the Collateral, including
describing the Collateral as all assets of Borrower, whether or not the Borrower’s signature appears thereon.

 

    	Loan Agreement	Page 14

    	 

    

  

ARTICLE
4

Conditions Precedent to Lending

 

4.1.          Initial
Extension of Credit. The obligation of Bank to make the initial Advance under the Note is subject to the condition precedent
that Bank shall have received on or before the Closing Date all of the following, each dated (as applicable and unless otherwise
indicated) on or as of the Closing Date, in form and substance satisfactory to Bank:

 

(a)          Resolutions.
Resolutions of the Board of Trustees (or other governing body) of Borrower and each other Obligated Party certified by the Secretary
(or other custodian of records) of Borrower and each other Obligated Party which authorize the execution, delivery, and performance
by Borrower or any such Obligated Party of this Agreement and the other Loan Documents to which Borrower or any such Obligated
Party is or is to be a party;

 

(b)          Incumbency
Certificate. A certificate of incumbency certified by an authorized officer or representative certifying the names of the individuals
or other Persons authorized to sign this Agreement and the other Loan Documents to which Borrower or any other Obligated Party
is or is to be a party on behalf of Borrower or any such Obligated Party together with specimen signatures of such Persons;

 

(c)          Organizational
Documents. The Organizational Documents for Borrower and each other Obligated Party as of a date acceptable to Bank;

 

(d)          Governmental
Certificates. Certificates of the appropriate government officials of the state of incorporation or organization of Borrower
and each other Obligated Party as to the existence and good standing of Borrower or any such Obligated Party, each dated within
ten (10) days prior to the date of the initial Advance;

 

(e)          Note.
The Note, executed by Borrower;

 

(f)          Loan
Agreement. This Agreement, executed by Borrower;

 

(g)         Insurance
Matters. Copies of insurance certificates describing all insurance policies required by the Agreement and the other Loan Documents,
together with loss payable and lender endorsements in favor of Bank with respect to all insurance policies covering Collateral;

 

(h)          Fees.
Payment of the Commitment Fee from the Borrower;

 

(i)          [Intentionally
Deleted];

 

(j)          Security
Documents. The Security Documents executed by each party thereto;

 

(k)         Other
Loan Documents. Each other Loan Document, duly executed by each Obligated Party which is a party thereto;

 

(l)          UCC
Search. The results of a UCC search showing all financing statements and other documents or instruments on file against Borrower
in the offices of the Secretaries of State of Texas and Maryland;

 

(m)        Attorneys’
Fees and Expenses. Evidence that the costs and expenses (including reasonable attorneys’ fees) referred to in Section 6.5,
to the extent incurred, shall have been paid in full by Borrower;

 

    	Loan Agreement	Page 15

    	 

    

  

(n)          Legal
Opinion. A legal opinion from counsel to the Borrower, as approved by Bank, confirming such authority, validity, and binding
effect of the documents in accordance with their terms, confirming that neither the Loan nor any of the financing arrangements
contemplated by this Agreement violate the usury laws of the State of Texas, and covering such other matters as Lender may require
in form and content acceptable to Bank’s legal counsel and containing no exceptions other than such as may be acceptable
to Lender and its legal counsel; and

 

(o)          Additional
Items. The additional items set forth on Schedule One.

 

4.2.          Conditions
for All Advances. In addition to the conditions precedent stated elsewhere herein, Bank shall not be obligated to make any
Advance unless Bank has approved the Eligible Mortgage Loan in accordance with Section 2.1, all items from Section 4.1
have been provided to Bank (unless otherwise waived in writing by Bank) and in the event the Advance being requested is a subsequent
Advance for an Eligible Mortgage Loan then the Eligible Mortgage Loan remains qualified as such and is not subject to being repaid
in accordance with Section 2.1 and the Advances made by Bank together with the requested Advance comply with the Borrowing
Base and Borrowing Limit:

 

(a)          Representations
and Warranties. The representations and warranties made by Borrower and each Obligated Party in the Loan Documents are true
and correct in all respects at and as of the time the Advance is to be made, and the request for an Advance shall constitute the
representation and warranty by Borrower that such representations and warranties are true and correct in all respects at such time.

 

(b)          No
Event of Default. On the date of, and upon receipt of, the Advance, no Event of Default, and no event which, with the lapse
of time or notice or both, could reasonably be expected to become an Event of Default, shall have occurred and be continuing.

 

(c)          Advance
Request. Bank has received an Advance Request, as well as such other documents, certificates, agreements, instruments and evidences
as Bank may request (in its sole and absolute discretion), including, but not limited to, a Borrowing Base Certificate.

 

(d)          Form
of Eligible Mortgage Paper. Bank has approved the form/content of any and all Eligible Mortgage Paper to be assigned and pledged
to Bank.

 

(e)          Assignment
of Eligible Mortgage Paper. All Eligible Mortgage Paper has been assigned and pledged to Bank as follows (all to be satisfactory
to Bank):

 

(i)          All
Eligible Mortgage Paper has been assigned and pledged to Bank, in form and substance satisfactory to Bank, including, without limitation,
the execution by Borrower of the Assignment of Notes and Liens or a Mortgage Assignment, to the extent required by Bank;

 

(ii)         all
Mortgage Notes relating to Eligible Mortgage Loans have been properly endorsed by Borrower to Bank with full recourse against Borrower
with such endorsement being evidenced by an Allonge affixed to each Mortgage Note, and executed by Borrower in form/content acceptable
to Bank; and

 

(iii)        the
Mortgage Note, and to the extent requested by Bank the other Mortgage Paper, relating to the Eligible Mortgage Loans has been delivered
to Bank.

 

(f)          Additional
Documentation. Bank shall have received such additional approvals or documents as Bank may request (in its sole and absolute
discretion).

 

    	Loan Agreement	Page 16

    	 

    

  

(g)          Inspections
and Lien Waivers. Bank has received and approved an inspection on any Finished Lot or Lot Development Property by a third-party
inspector engaged by Borrower and approved by Bank, and for a Lot Development Loan, each inspection shall verify the percentage
of completion related to the Lot Development Budget. For each Lot Development Loan, Borrower shall provide copies of full lien
waivers for all work performed for the Lot Development and a down date endorsement to the extent available. In no event shall Borrower
approve any modifications to the Lot Development Budget or the plans for any Lot Development Loan without the prior written consent
of Bank.

 

(h)          Borrower’s
Equity. Borrower (a) has sufficient funds in a deposit account held by Lender to fund fifty percent (50%) of the outstanding
principal balance of the Mortgage Loan that is part of the Borrowing Base (but not protective or discretionary advances of principal
or advances of interest reserve) (the “Required Equity”), or (b) provides Bank with evidence that Borrower has
already disbursed the Required Equity to the Mortgage Loan Obligor under the Mortgage Loan that is part of the Borrowing Base.

 

(i)          Finished
Lot Lien Release. For any Finished Lot Loan, a full release of lien in recordable form from the current first lien lender on
such Finished Lot to the extent Borrower is not the current first lien lender.

 

(j)          Lien
Waivers. An affidavit of non-commencement of delivery of materials or commencement of construction, plus for any subsequent
advance to the extent requested by Bank, copies of full lien waivers for all work performed in constructing a Home on a Finished
Lot and a down date endorsement to the extent available.

 

Each Advance hereunder
shall be deemed to be a representation and warranty by the Borrower to Bank that the conditions specified in this Section 4.2
have been satisfied on and as of the date of the applicable Advance.

 

ARTICLE
5

Representations and Warranties

 

Borrower continuously
represents and warrants to Bank as follows while any portion of the Indebtedness remains outstanding or while Bank has any commitment
to advance funds to Borrower:

 

5.1.          Existence.
Borrower is a real estate investment trust duly organized, validly existing, and in good standing under the laws of the State of
Maryland, and is duly qualified to transact business in each jurisdiction where the nature and extent of its business and property
requires the same. Borrower does not conduct business under any tradename other than as described on Schedule Two attached
hereto.

 

5.2.          Authorization.
Borrower possesses all requisite authority, power, licenses, permits, and franchises to conduct its business and execute, deliver,
and comply with the terms of the Loan Documents. The execution and delivery of this Agreement, the consummation of the transactions
herein contemplated and compliance with the terms and provisions hereof, the making of the Loans, and the execution, issuance,
and delivery of the Loan Documents have been duly authorized and approved by all necessary entity action on the part of Borrower.
No consent or approval of any Tribunal or any other Person is required in order for Borrower to legally execute, deliver, and comply
with the terms of the Loan Documents.

 

5.3.          Properties;
Permitted Liens. Borrower has good and indefeasible title to all of its real properties and good and marketable title to all
of its other properties and assets and to the Collateral, in each case free and clear of any Liens except the Permitted Liens.
Borrower has full power and authority to grant to Bank the security interest in the Collateral pursuant to the Loan Documents.
When financing statements have been filed in the appropriate offices against Borrower with respect to any Collateral, Bank will
have a fully perfected first priority security interest in that portion of the Collateral in which a security interest may be perfected
by filing, subject only to any Permitted Liens.

 

    	Loan Agreement	Page 17

    	 

    

  

5.4.          Compliance
with Laws and Documents. Borrower is not, nor will the execution, delivery, and performance of and compliance with the terms
of the Loan Documents cause Borrower to be, in violation of any Laws or in default (nor has any event occurred which, with the
giving of notice or lapse of time or both, would reasonably be expected to constitute such a default) under any contract in any
respect which could have a Material Adverse Effect. During the past five (5) years, there have been no proceedings, claims, or
(to the best of Borrower’s knowledge) investigations against or involving Borrower by any Tribunal under or pursuant to any
environmental, occupational safety and health, antitrust, unfair competition, securities, or other Laws which could have a Material
Adverse Effect, except those described on Schedule Two attached hereto (the “Tribunal Proceedings”).

 

5.5.          Litigation.
Borrower is not involved in, nor is Borrower aware of the threat of, any Litigation which could reasonably be expected to have
a Material Adverse Effect, and there are no outstanding or unpaid judgments against Borrower.

 

5.6.          Taxes.
All federal, state, foreign, and other Tax returns of Borrower required to be filed have been filed (or proper extensions have
been timely filed), all federal, state, foreign, and other Taxes imposed upon Borrower which are due and payable have been paid,
and no material amounts of Taxes not reflected on such returns are payable by Borrower, other than Taxes being contested in good
faith by appropriate legal proceedings.

 

5.7.          Enforceability
of Loan Documents. All Loan Documents when duly executed and delivered by Borrower will constitute legal, valid, and binding
obligations of Borrower enforceable against Borrower in accordance with their terms subject to Debtor Relief Laws and except that
the availability of equitable remedies may be limited.

 

5.8.          Financial
Statements. All financial statements of Borrower heretofore and hereafter to be delivered to Bank have been and shall continue
to be prepared in accordance with GAAP, or other method of accounting acceptable to Bank (subject to the absence of notes for interim
financial statements), and do and shall fairly represent the financial condition of Borrower as of the date of each such financial
statement (subject to reasonable year end adjustments for interim financial statements). There are and shall be no material liabilities,
direct or indirect, fixed or contingent, as of the date of each such financial statement which are not reflected therein or in
the notes thereto. Except for transactions directly related to, or specifically contemplated by, this Agreement and transactions
heretofore disclosed in writing to Bank, there has been no material adverse change in the financial condition of Borrower as shown
by the current Financial Statements for Borrower between the date of such Current Financial Statements and the date hereof, nor
has Borrower incurred any material liability, direct or indirect, fixed, or contingent, except as otherwise disclosed to and approved
in writing by Bank. Neither Borrower nor any of its Subsidiaries has any material Debt, other contingent liabilities, liabilities
for taxes, any long-term lease obligations or unusual forward or long-term commitments, or any hedge agreement or other transaction
or obligation in respect of derivatives, that are not reflected in the most recent financial statements referred to in this paragraph.

 

5.9.          Regulation
U. The proceeds of the Advances are not and will not be used directly or indirectly for the purpose of purchasing or carrying,
or for the purpose of extending credit to others for the purpose of purchasing or carrying, any “margin stock” as that
term is defined in Regulation U of the Board of Governors of the Federal Reserve System.

 

5.10.         Subsidiaries.
Borrower has no Subsidiaries as of the date of this Agreement except those described on Schedule Two. Except for the Permitted
Liens, there are no outstanding subscriptions, options, warrants, calls, rights or other agreements or commitments of any
nature relating to any equity interests of the Borrower, except as created by the Loan Documents.

 

    	Loan Agreement	Page 18

    	 

    

  

5.11.         Other
Debt. Except as set forth on Schedule Two attached hereto, Borrower is not directly, indirectly, or contingently obligated
with respect to any Debt as of the Closing Date. Borrower is not in default in the payment of the principal of or interest on any
such Debt.

 

5.12.         Regulatory
Acts. Borrower is not an “investment company” or “controlled” by an “investment company”
within the meaning of the Investment Company Act of 1940, as amended, or is subject to regulation under the Federal Power Act,
the Interstate Commerce Act, or any other Law (other than Regulation X of the Board of Governors of the Federal Reserve System)
which regulates the incurring by Borrower or Guarantor of debt, including, but not limited to, Laws regulating common or contract
carriers or the sale of electricity, gas, steam, water, or other public utility serves. All Inventory of Borrower has been and
will hereafter be produced in compliance with all applicable Laws.

 

5.13.         Environmental
Matters. To the best knowledge of Borrower after due inquiry:

 

(a)          Borrower
and all of its properties, assets, and operations are in full compliance with all Environmental Laws. Borrower is not aware of
nor has Borrower received notice of any past, present, or future conditions, events, activities, practices or incidents which may
interfere with or prevent the compliance or continued compliance of Borrower and the Subsidiaries with all Environmental Laws;

 

(b)          Borrower
has obtained all permits, licenses, and authorizations that are required under applicable Environmental Laws, and all such permits
are in good standing and Borrower is in compliance with all of the terms and conditions of such permits;

 

(c)          No
Hazardous Materials (except in nominal amount) exist on, about, or within or have been used, generated, stored, transported, disposed
of on, or Released from any of the properties or assets of Borrower. The use which Borrower makes and intends to make of its properties
and assets will not result in the use, generation, storage, transportation, accumulation, disposal, or Release of any Hazardous
Material on, in, or from any of their properties or assets;

 

(d)          Neither
Borrower nor any of its currently or previously owned or leased properties or operations is subject to any outstanding or threatened
order from or agreement with any Tribunal or other Person or subject to any judicial or docketed administrative proceeding with
respect to (i) failure to comply with Environmental Laws, (ii) Remedial Action, or (iii) any Environmental Liabilities arising
from a Release or threatened Release;

 

(e)          There
are no conditions or circumstances associated with the currently or previously owned or leased properties or operations of Borrower
that could reasonably be expected to give rise to any Environmental Liabilities;

 

(f)          Borrower
has not filed or failed to file any notice required under applicable Environmental Law reporting a Release; and

 

(g)          No
Lien arising under any Environmental Law has attached to any property or revenues of Borrower.

 

5.14.         Locations.
The location of Borrower’s chief executive office and all other locations where Borrower conducts its business are disclosed
in Schedule Two.

 

5.15.         General.
There is no significant material fact or condition relating to the financial condition and business of Borrower, or the Collateral
which has not been disclosed in writing to Bank, and all writings heretofore or hereafter exhibited, made, or delivered to Bank
by or on behalf of Borrower are and will be genuine and in all respects what they purport and appear to be.

 

    	Loan Agreement	Page 19

    	 

    

  

5.16.         Intellectual
Property. All material Intellectual Property owned or used by the Borrower, or any Subsidiary is listed, together with application
or registration numbers, where applicable, in Schedule Two. Each Person identified on Schedule Two owns, or is licensed
to use, all Intellectual Property necessary to conduct its business as currently conducted except for such Intellectual Property
the failure of which to own or license could not reasonably be expected to have a material adverse effect. Each Person identified
on Schedule Two will maintain the patenting and registration of all Intellectual Property with the United States Patent
and Trademark Office, the United States Copyright Office, or other appropriate Governmental Authority and each Person identified
on Schedule Two will promptly patent or register, as the case may be, all new Intellectual Property and notify the Bank
in writing five (5) Business Days prior to filing any such new patent or registration.

 

5.17.         Solvency.
Borrower and each Subsidiary are solvent and generally able to pay their debts as they come due.

 

5.18.         Individual
Mortgage Loans. In addition to the representations and warranties contained in the Assignment of Notes and Liens, Borrower
hereby represents and warrants with respect to each Mortgage Note and Mortgage Loan that is part of the Collateral;
provided, however, that notwithstanding anything herein to the contrary, the representations and warranties set forth in this Section
5.18 shall apply to Mortgage Loans in the Borrowing Base only and shall not apply to any other loans made by Borrower:

 

(a)          Borrower
has good and marketable title to each Mortgage Note and Mortgage, is the sole owner thereof and has full right to pledge the Mortgage
Loan to Lender free and clear of any other Lien except for the Permitted Liens;

 

(b)          There
is no default or event of acceleration existing under any Mortgage Paper;

 

(c)          To
the best knowledge of Borrower, the physical condition of the real property, improvements, and personal property subject to the
Mortgage has not deteriorated since the date of origination of the related Mortgage Loan (normal wear and tear excepted) and there
is no proceeding pending for the total or partial condemnation of any of the related mortgaged property and no material casualty
has occurred with respect to the mortgaged property;

 

(d)          Each
Mortgage contains customary and enforceable provisions such as to render the rights and remedies of the holder thereof adequate
for the realization against the related real property, improvements, and personal property subject to the Mortgage of the benefits
of the security provided thereby, including, (i) in the case of a Mortgage, by trustee’s sale, and (ii) otherwise, by judicial
foreclosure;

 

(e)          Each
Mortgage Loan is a first lien Lot Development Loan or Finished Lot Loan, has been underwritten by the Borrower in accordance with
Borrower’s then current underwriting guidelines;

 

(f)          No
Mortgage Loan is a loan in respect of the construction of a townhome, duplex or condominium or the purchase of a manufactured home
or mobile home or the land on which a manufactured home or mobile home will be placed; no Mortgage securing a Mortgage Loan secures
commercial property;

 

(g)          The
origination practices used by Borrower and the collection practices used by Borrower with respect to each Mortgage Loan have been
in all material respects legal, proper, prudent and customary in the loan origination and servicing business;

 

    	Loan Agreement	Page 20

    	 

    

  

(h)          To
the best knowledge of Borrower, each Mortgage Loan was originated in compliance with all applicable laws and no fraud or misrepresentation
was committed by any Person in connection therewith; and

 

(i)          The
Mortgage Note and loan documents evidencing the Mortgage Note are valid and enforceable and have not been altered, modified or
amended in any manner whatsoever except for those approved by Bank nor has Borrower (or any prior holder of the Mortgage
Note) executed any instrument of release (except those contemplated by the Loan Documents and which have been approved by Bank),
cancellation or satisfaction of all or any portion of the collateral securing said Mortgage Note, or released any party from any
liability with respect to said collateral and true, correct and complete originals (or in the case of the loan documents other
than the Mortgage Note and Allonge, copies) of the loan documents evidencing the Mortgage Loan have been provided to Bank.

 

ARTICLE
6

Affirmative Covenants

 

So long as Bank is
committed to make Advances hereunder, and thereafter until payment and performance in full of all of the Indebtedness and Obligations,
Borrower covenants and agrees that:  

 

6.1.          Reporting
Requirements. Borrower shall provide to Bank and/or cause Guarantor to provide to Bank:

 

(a)          Quarterly
and Annual Financial Statements and Tax Returns of Borrower. Within the earlier of (i) ninety (90) days after filing or (ii)
March 2nd of each year, annual Form 10-K for Borrower filed with the Securities and Exchange Commission (the “SEC”)
(or if no longer required to be filed by the SEC, annual audited (by a certified public accountant acceptable to Bank) financial
statements) showing the financial position and results of operations of Borrower as of, and for the year ended on, such last day.
Within the earlier of (i) forty-five (45) days after filing or (ii) May 15th, August 15th and November 15th
of each year, quarterly Form 10-Q for Borrower filed with the SEC (or if no longer required to be filed by the SEC, quarterly audited
(by a certified public accountant acceptable to Bank) financial statements) showing the financial position and results of operations
of Borrower as of, and for the quarter ended on, such last day. All financial statements submitted to Bank shall include (i) the
unqualified opinion of such certified public accountant that such financial statements present fairly, in all material respects,
the financial position of Borrower as of the last day of such fiscal year and the results of operations and the cash flow of Borrower
for the fiscal year then ended in conformity with GAAP, or other method of accounting acceptable to Bank and with no exceptions,
inconsistencies, or uncertainties described or disclosed therein; and (ii) the certificate of Borrower that all of such financial
statements present fairly the financial position of Borrower as of the last day of such fiscal year and the results of the operations
and the cash flow of Borrower for the fiscal year then ended in conformity with GAAP, or other method of accounting acceptable
to Bank. Each such financial statement shall contain at least a balance sheet of Borrower as at the end of such fiscal year and
statements of income, cash flow, and retained earnings. Borrower shall provide Bank with a copy of such Borrower’s annual
tax return for the preceding calendar year, as soon as available, but in no event later than the earlier of (a) thirty (30) days
after filing or (b) October 15th of each calendar year.

 

(b)          Monthly
Financial Statements of Borrower. Within thirty (30) days after the last day of each calendar month, internally prepared financial
statements of Borrower (including, but not necessarily limited to, balance sheets and a related statement of income), showing the
financial position and results of operations of Borrower as of and for such calendar month and for the period from the beginning
of the current fiscal year to the last day of such calendar month, together with a certificate executed by Borrower certifying
that such financial statements present fairly the financial position of Borrower as of the last day of such periods in conformity
with GAAP, or other method of accounting acceptable to Bank (except as to reasonable year end adjustments and the absence of notes
with respect to interim financial statements);

 

    	Loan Agreement	Page 21

    	 

    

  

(c)          Borrowing
Base Certificate. Within thirty (30) days after the last day of each calendar month, a Borrowing Base Certificate as of the
end of such month and in connection with any Advance Request;

 

(d)          Compliance
Certificate. Concurrently with the delivery of each of the financial statements referred to in Sections 6.1(b), a certificate
of the chief financial officer of Borrower (i) stating that to the best of such Person’s knowledge, no Event of Default has
occurred and is continuing, or if an Event of Default has occurred and is continuing, a statement as to the nature thereof and
the action which is proposed to be taken with respect thereto, and (ii) showing in reasonable detail the calculations demonstrating
compliance with Article Eight;

 

(e)          Notice
of Material Adverse Effect. As soon as possible and in any event within five (5) days after the occurrence thereof, written
notice of the occurrence of any event or condition that could reasonably be expected to have a Material Adverse Effect; and

 

(f)          General
Information. Promptly, such other information concerning Borrower or any Obligated Party as Bank may from time to time reasonably
request.

 

6.2.          Insurance.
Borrower will maintain insurance with financially sound and reputable insurance companies in such amounts and covering such risks
as is usually carried by similar entities engaged in similar businesses and owning similar properties in the same general areas
in which Borrower operates, provided that in any event Borrower will maintain workmen’s compensation insurance, property
insurance, comprehensive general liability insurance, and business interruption insurance satisfactory to Bank. Each insurance
policy covering Collateral shall name Bank as loss payee and shall provide that such policy will not be canceled or reduced without
thirty (30) days prior written notice to Bank.

 

6.3.          Payment
of Debts. Borrower will pay or cause to be paid all of its Debt prior to the date on which penalties attach thereto (except
to the extent and so long as the payment thereof is being properly contested in good faith by appropriate proceedings and adequate
reserves have been established therefor).

 

6.4.          Taxes.
Borrower will promptly pay or cause to be paid when due (for the account of Bank, where appropriate) any and all Taxes due by Borrower,
including, without limitation, all taxes, duties, fees, levies and other charges of whatsoever nature which have been or may be
imposed by any government or by any department, agency, state, other political subdivision or taxing authority thereof or therein;
provided that Borrower shall not be required to pay and discharge any such Taxes or charges so long as the validity thereof shall
be contested in good faith by appropriate proceedings and Borrower shall set aside on its books adequate reserves with respect
thereto and shall pay any such Taxes or charge before the property subject thereto shall be sold to satisfy any lien which has
attached as security therefor.

 

6.5.          Expenses
of Bank. Borrower will reimburse Bank for all out-of-pocket costs, fees, and expenses incident to the Loan Documents or any
transactions contemplated thereby, including, without limitation, all recording fees, all recording taxes, and the reasonable fees
and disbursements of special counsel for Bank for negotiation and preparation of the Loan Documents, preparation and review of
other documents, and providing of other legal services, from time to time, in connection herewith up through the Closing Date,
and thereafter for services (a) in connection with any subsequent Advance, (b) in connection with or in anticipation of an
Event of Default or otherwise in the enforcement of the Loan Documents, (c) in connection with any amendment or waiver to any of
the Loan Documents, or (d) in connection with any request or action initiated by Borrower, all of which shall be and become a part
of the Indebtedness.

 

    	Loan Agreement	Page 22

    	 

    

  

6.6.          Maintenance
of Entity Existence, Assets and Business; Continuance of Present Business. Borrower will preserve and maintain its existence
and all of its leases, licenses, permits, franchises, qualifications, and rights that are necessary or desirable in the ordinary
conduct of its business. Borrower will conduct its business in an orderly and efficient manner in accordance with good business
practices. Borrower will keep or cause to be kept all of Borrower’s assets which are useful and necessary in their respective
businesses in good repair, working order and condition, and will make or cause to be made all necessary repairs, renewals and replacements
as may be reasonably required. Borrower will carry on and conduct its business in substantially the same fields as such business
is now and has heretofore been carried on.

 

6.7.          Books
and Records. Borrower will maintain proper books of record and account in which full, true, and correct entries in conformity
with GAAP, or other method of accounting acceptable to Bank, shall be made of all dealings and transactions in relation to its
business and activities.

 

6.8.          Compliance
with Applicable Laws and with Contracts. Borrower will comply with the requirements of all applicable material Laws, rules,
regulations and orders of any governmental authority, except where contested in good faith and by proper proceedings. Borrower
will comply in all material respects with all agreements, contracts, and instruments binding on it or affecting its properties
or business.

 

6.9.          Comply
with Agreement. Borrower will fully comply with the terms, provisions and conditions of this Agreement and of all documents
executed pursuant hereto.

 

6.10.         Notice
of Event of Default, Suits, and Material Adverse Effect. Upon discovery, Borrower will promptly notify Bank of any breach of
any of the covenants contained in any of the Loan Documents and of the occurrence of any Default or Event of Default under any
of the Loan Documents, or of the filing of any claim, action, suit or proceeding before any Tribunal agency against Borrower or
any other Obligated Party which could reasonably be expected to have a Material Adverse Effect and advise Bank from time to time
of the status thereof.

 

6.11.         Information
and Inspection. To the extent applicable, Borrower will furnish to Bank as soon as available copies of all (a) materials filed
pursuant to the Securities Act of 1933, or 1934, as amended, by Borrower with the Securities and Exchange Commission, (b) reports
to stockholders, and (c) press releases, and at any reasonable time any other information pertinent to any provision of this
Agreement or to Borrower’s business which Bank may reasonably request. Borrower shall permit an authorized representative
of Bank to visit and inspect at reasonable times any of the properties of Borrower and to discuss the affairs, finances, and accounts
of Borrower with the officers and employees of Borrower.

 

6.12.         Additional
Information. Borrower will promptly furnish or cause to be furnished to Bank such other information not otherwise required
herein respecting (i) the business affairs, assets and liabilities of Borrower, Guarantor, the Subsidiaries as Bank shall reasonably
request and (ii) the Collateral as Bank shall from time to time request.

 

6.13.         Asset
Audit. Borrower shall permit representatives of Bank at the expense of Borrower to inspect and conduct an audit of all of Borrower’s
assets and properties (both real and personal, including Accounts and Inventory); provided, however, if such audit is conducted
by Bank more than once during any fiscal year, and such additional audit is not the result of the occurrence and continuation of
an Event of Default, Bank shall be responsible for the fee payable to the Person that performed such additional audit.

 

6.14.         Recorded
Mortgages and Title Insurance. Borrower shall deliver to Bank as soon as available but in any event within thirty (30) days
after any Mortgage Paper that is part of the Borrowing Base is assigned and pledged to Bank by Borrower:

 

    	Loan Agreement	Page 23

    	 

    

  

(a)          the
recorded Mortgage or Mortgages related to such Mortgage Paper; and

 

(b)          the
loan policy of title insurance with respect to each Finished Lot Loan and Lot Development Loan, issued by the title company in
connection with each recorded Mortgage related to such Mortgage Paper together with such endorsements thereto as Bank may deem
necessary which evidences that each Mortgage so assigned and pledged to Bank is an insured first lien.

 

6.15.         Insurance.
Borrower shall deliver to Bank at the time any Mortgage Paper that is part of the Borrowing Base is assigned and pledged to Bank
by Borrower, all insurance policies and certificates of insurance necessary to evidence that the improvements described in each
Mortgage have been insured against loss by fire and other casualty in the full amount of the Mortgage Loan that is part of the
Borrowing Base secured by such Mortgage and Bank is shown as a loss payee in such policies, as its interests may appear.

 

6.16.         Appraisals.
Borrower shall deliver to Bank at the time any Mortgage Paper that is part of the Borrowing Base is assigned and pledged to Bank
by the Borrower, all appraisals relating to the property described in the Mortgage comprising a part of such Mortgage Paper that
is part of the Borrowing Base, and, if Bank rejects any such appraisals for any reason, in its sole discretion, Borrower shall
obtain a current appraisal of any such property, which is deemed satisfactory by Bank.

 

6.17.         Environmental.
Borrower shall deliver to Bank at the time any Mortgage Paper that is part of the Borrowing Base is assigned to Bank by Borrower,
any and all documents Borrower has received that evidence the environmental safety and soundness of the real property relating
to such Mortgage Paper that is part of the Borrowing Base.

 

6.18.         Appraisals.
If any appraisal is required or desired by Bank with respect to any property covered by a Mortgage which constitutes part of Eligible
Mortgage Paper, Borrower shall, within thirty (30) days following a request therefor by Bank, furnish to Bank (at Borrower’s
sole cost and expense) an appraisal with respect to such property in form, substance and by an appraising firm acceptable to Bank.
In the event Borrower should fail to timely provide an acceptable appraisal pursuant to this Section 6.18, then, and in
such event, Bank shall be entitled to obtain its own appraisal of such property at Borrower’s cost and expense. Unless an
Event of Default exists, Borrower shall not be obligated to furnish more than one (1) appraisal during any twelve (12) month period
at Borrower’s expense, except upon the occurrence and during the continuance of an Event of Default. Bank shall further be
entitled, at any time, to obtain an appraisal on its own, and at Bank’s expense, and any such appraisal obtained by Bank
may be utilized by Bank (even in lieu of other available appraisals) to undertake the loan-to-value calculations described in the
definition of Eligible Mortgage Loans.

 

6.19.         Eligible
Mortgage Loans Not Part of the Borrowing Base. At any time and from time to time, Bank may request that Borrower provide those
certain items as set forth in Sections 6.14 through 6.18 for any Eligible Mortgage Loan that is not part of the Borrowing
Base, and Borrower shall provide such items within thirty (30) days after written request thereof from Bank.

 

ARTICLE
7

Negative Covenants

 

So long as Bank is
committed to make Advances hereunder, and thereafter until payment and performance in full of all of the Indebtedness and all of
the Obligations, Borrower covenants and agrees that, without the prior written consent of Bank (which may be withheld in Bank’s
sole and absolute discretion):

 

    	Loan Agreement	Page 24

    	 

    

  

7.1.          Debt.
Borrower will not incur, create, assume, or permit to exist, any Debt, except:

 

(a)          Debt
to Bank; and

 

(b)          Permitted
Liens.

 

7.2.          Contingent
Liabilities. Borrower will not, directly or indirectly, assume, guarantee, endorse, contingently agree to purchase or otherwise
become liable upon the obligation of any Person (other than Borrower) except by the endorsement of negotiable instruments for deposit
or collection or similar transactions in the ordinary course of business.

 

7.3.          Limitation
on Liens. Borrower will not, directly or indirectly, incur, create, assume, or permit to exist any Lien upon any of its property,
assets, or revenues, whether now owned or hereafter acquired, except:

 

(a)          The
Permitted Liens;

 

(b)          Encumbrances
consisting of minor easements, zoning restrictions, or other restrictions on the use of real property that do not (individually
or in the aggregate) materially affect the value of the assets encumbered thereby or materially impair the ability of Borrower
to use such assets in its business, and none of which is violated in any material respect by existing or proposed structures or
land use;

 

(c)          Liens
for taxes, assessments, or other governmental charges which are being contested in good faith and for which adequate reserves have
been established; and

 

(d)          Liens
resulting from good faith deposits to secure payments of workmen’s compensation or other social security programs or to secure
the performance of tenders, statutory obligations, surety and appeal bonds, bids, or contracts (other than for payment of Debt),
or leases made in the ordinary course of business.

 

7.4.          Mergers,
Etc. Borrower will not, directly or indirectly (a) become a party to a merger or consolidation, or (b) purchase or otherwise
acquire all or any part of the assets or shares or other evidence of beneficial ownership of any Person, (c) form a new Subsidiary
or transfer assets to any Subsidiary, unless prior to the formation of or any transfer of assets to a Subsidiary, such Subsidiary
executes and delivers to Bank such guaranty and/or pledge agreements as may be required by Bank, (d) wind-up, dissolve, or liquidate,
or (e) otherwise modify or amend its organizational documents or transfer any ownership or beneficial interest in Borrower that
would effect a Change of Control in Borrower.

 

7.5.          Restricted
Payments. Borrower will not, directly or indirectly, declare or pay any dividends or make any other payment or distribution
(in cash, property, or obligations) on account of its equity interests, or redeem, purchase, retire, or otherwise acquire any of
its equity interests, or set apart any money for a sinking or other analogous fund for any dividend or other distribution on its
equity interests or for any redemption, purchase, retirement, or other acquisition of any of its equity interests, or undertake
any new obligation (contingent or otherwise) to do any of the foregoing; provided, however, Borrower may declare
and pay cash distributions to holders of its equity interest provided that (i) at the time of payment of such distribution no Default
exists or would result immediately after giving effect to such distribution, or (ii) even if
a Default exists or would result immediately after giving effect to such distribution, failure of Borrower to make such distribution
could cause Borrower to forfeit its status as a real estate investment trust.

 

    	Loan Agreement	Page 25

    	 

    

  

7.6.          Loans
and Investments. Borrower will not, directly or indirectly, make any advance, loan, extension of credit, or capital contribution
to or investment in, or purchase, any stock, bonds, notes, debentures, or other securities of, any Person, except:

 

(a)          readily
marketable direct obligations of the United States of America or any agency thereof with maturities of one year or less from the
date of acquisition; and

 

(b)          fully
insured depository accounts maintained at a commercial bank operating in the United States of America; and

 

(c)          loans
to the Mortgage Loan Obligors provided that if the Mortgage Loan is to become a Mortgage Loan as part of the Borrowing Base, the
Mortgagee Paper evidencing and securing each Mortgage Loan has been collateral assigned to Bank, in form, scope and substance satisfactory
to Bank (in its sole and absolute discretion).

 

7.7.          Limitation
on Issuance of Equity. Borrower will not, directly or indirectly, at any time issue, sell, assign, or otherwise dispose of
(a) any of its equity interests, (b) any securities exchangeable for or convertible into or carrying any rights to acquire any
of its equity interests, or (c) any option, warrant, or other right to acquire any of its equity interests.

 

7.8.          Transactions
with Affiliates. Subject to Bank’s approval of Eligible Mortgage Loans and other transactions previously approved in
writing by Bank (in Bank’s sole and absolute discretion, without any obligation to so approve), except as to those parties
and in such capacities as set forth on Schedule Two, Borrower will not, directly or indirectly, enter into any transaction,
including, without limitation, the purchase, sale, or exchange of property or the rendering of any service or the payment of any
management, advisory or similar fees, with any Affiliate of Borrower; provided, however, Bank approves the Permitted Liens.

 

7.9.          Disposition
of Assets. Borrower will not, directly or indirectly, sell, lease, assign, transfer, or otherwise dispose of any of its assets,
except (a) dispositions of Inventory in the ordinary course of business, (b) dispositions, for fair value, of worn-out and obsolete
equipment not necessary to the conduct of its business, and (c) dispositions of Mortgage Loans and the Mortgage Paper relating
thereto which have been paid in full and no longer constitute Collateral.

 

7.10.         Nature
of Business. Borrower will not engage in any business other than the Permitted Businesses.

 

7.11.         Environmental
Protection. Borrower will not, directly or indirectly, (a) use (or permit any tenant to use) any of its properties or assets
for the handling, processing, storage, transportation, or disposal of any Hazardous Material, (b) generate any Hazardous Material,
(c) conduct any activity that is likely to cause a Release or threatened Release of any Hazardous Material, or (d) otherwise conduct
any activity or use any of its respective properties or assets in any manner that is likely to violate any Environmental Law or
create any Environmental Liabilities for which Borrower would be responsible.

 

7.12.         No
Negative Pledge. Borrower will not enter into or permit to exist any arrangement or agreement, other than pursuant to this
Agreement or any Loan Document, which directly or indirectly prohibits or limits the ability of Borrower to or from creating or
incurring a Lien on any of its assets, whether now owned or hereafter acquired.

 

7.13.         Judgments.
Borrower will not allow any judgment for the payment of money in excess of $50,000.00 rendered against it to remain undischarged
or unsuperseded for a period of thirty (30) days during which execution shall not be effectively stayed.

 

7.14.         Sale
and Leaseback. The Borrower will not enter into, and will not permit any Subsidiary to enter into, any arrangement with any
Person pursuant to which it leases from such Person real or personal property that has been or is to be sold or transferred, directly
or indirectly, by it to such Person.

 

    	Loan Agreement	Page 26

    	 

    

  

7.15.         Prepayment
of Debt. Except the Indebtedness, prepayments by Borrower in non-material amounts, and expenses
of Borrower in the ordinary course of business, the Borrower will not prepay, and will not permit any Subsidiary to prepay,
any Debt without the prior written consent of Bank. As used in this Section 7.15, “non-material” shall mean
amounts less than $10,000.00.

 

7.16.         Servicing
Rights. Except to UDFH Land Development, L.P. and UDFH General Services, L.P. under servicing, management, or advisor agreements
approved in writing by Bank, Borrower will not sell or assign its servicing rights to any of the Eligible Mortgage Paper.

 

7.17.         [Intentionally
deleted]

 

7.18.         No
Participations. Borrower shall not sell any participation or similar interests in any Mortgage Loan in the Borrowing Base without
the prior written consent of Bank, which may be granted or denied in its sole discretion.

 

7.19.         Actions
With Respect To Mortgage Collateral. Borrower shall not without the prior written consent of Bank (which may be withheld in
Bank’s sole and absolute discretion):

 

(a)          compromise,
extend, release, or adjust payments on any Mortgage Collateral securing any Mortgage Loan that is part of the Borrowing Base, accept
a conveyance of mortgaged property in full or partial satisfaction of any such Mortgage Collateral, or release any Mortgage securing
or underlying any such Mortgage Collateral; provided, however, if a Mortgage Loan Obligor repays a Mortgage Loan that is part of
the Borrowing Base in full Borrower shall be permitted to release the lien of the Mortgage Loan (subject to Borrower’s obligations
to repay Advances made by Bank as contained herein);

 

(b)          modify
or amend the loan documents evidencing the Mortgage Loan that is part of the Borrowing Base except for non-material modifications
which do not modify the maturity date, increase the principal balance, lower the interest rate, waive any default or release any
obligor; or

 

(c)          transfer,
sell, assign, or deliver any Mortgage Loan that is part of the Borrowing Base pledged to Bank to any Person other than Bank in
the event the Mortgage Loan is no longer considered an Eligible Mortgage Loan and no longer Collateral for Bank.

 

ARTICLE
8

Financial Covenants

 

Borrower covenants
and agrees that, as long as any Indebtedness or Obligations or any part thereof is outstanding or Bank is under any obligation
to make additional Advances under this Agreement, Borrower will, at all times, observe and perform the following financial covenants:

 

8.1.          Leverage
Ratio. Borrower will maintain a Leverage Ratio of not greater than 1.0 to 1.0, which shall be tested quarterly on each March
31, June 30, September 30 and December 31 and shall be certified in compliance in the Compliance Certificate.

 

8.2.          [Intentionally
Deleted.]

 

    	Loan Agreement	Page 27

    	 

    

  

ARTICLE
9

Events of Default

 

The term “Event
of Default” as used herein shall mean the occurrence of any one or more of the following events:

 

9.1.          Payment
of Indebtedness. The failure of Borrower to punctually pay the Indebtedness, or any part thereof, as the same become due in
accordance with the terms of the Loan Documents, including, without limitation, the failure or refusal of Borrower to punctually
pay the principal of or the interest on any Loan or the failure or refusal of Borrower to repay any portion of an Eligible Mortgage
Loan that is no longer qualified as such in accordance with Article 2 hereof;

 

9.2.          Negative
and Financial Covenants. Borrower shall breach any provision of Article VII or Article VIII of this Agreement
or the sale, encumbrance or other unauthorized transfer of all or any portion of the Collateral without Bank’s prior written
consent;

 

9.3.          Misrepresentation.
Any statement, representation, or warranty heretofore or hereafter made by Borrower or any other Obligated Party in this Agreement
or in any other Loan Document or in any writing, or any statement or representation made in any certificate or report delivered
to Bank pursuant to the Loan Documents, is false, calculated to mislead, misleading, or erroneous in any material respect at the
time made;

 

9.4.          Other
Covenants. The failure or refusal of Borrower or any other Obligated Party to perform, observe, and comply with any covenant
or agreement contained in any of the Loan Documents (other than as covered by Section 9.1 and Section 9.2 above)
and such breach continues uncured for thirty (30) days after written notice thereof from Bank;

 

9.5.          Voluntary
Debtor Relief. Borrower or any other Obligated Party shall (a) execute an assignment for the benefit of creditors, or (b) become
or be adjudicated as bankrupt or insolvent, or (c) generally not, or be unable to, or admit in writing its inability to, pay
its debts generally as they become due, or (d) apply for or consent to the appointment of a conservator, receiver, trustee, liquidator,
custodian or other similar official of it or all or a substantial part of its assets, or (e) file a voluntary petition, or commence
any other proceeding, or other action, seeking liquidation, reorganization or dissolution, conservatorship, or seek any other arrangement
with creditors or to take advantage or seek any other relief under any Debtor Relief Law now or hereafter existing, or (f) file
an answer admitting the material allegations of or consenting to, or default in, a petition filed against it in any liquidation,
conservatorship, bankruptcy, reorganization, rearrangement, debtor’s relief, or other insolvency proceedings, or (g) institute
or voluntarily be or become a party to any other judicial proceedings intended to effect a discharge of its debts, in whole or
in part, or a postponement of the maturity or the collection thereof, or a suspension of any of the Rights or powers of Bank granted
in any of the Loan Documents;

 

9.6.          Involuntary
Proceedings. Borrower or any other Obligated Party shall involuntarily (a) have an order, judgment, or decree entered against
it by any Tribunal pursuant to any Debtor Relief Law that could suspend or otherwise affect any of the Rights granted to Bank in
any of the Loan Documents, and such order, judgment, or decree is not permanently stayed, vacated, or reversed within thirty (30)
days after the entry thereof, or (b) have a petition filed against it or any of its property seeking the benefit or benefits provided
for by any Debtor Relief Law that would suspend or otherwise affect any of the Rights granted to Bank in any of the Loan Documents,
and such petition is not discharged within thirty (30) days after the filing thereof;

 

9.7.          Attachment.
The failure to have discharged within a period of thirty (30) days after the commencement thereof any attachment, sequestration,
or similar proceedings against any of the material assets of Borrower or any other Obligated Party;

 

9.8.          Other
Debt. Borrower or any other Obligated Party shall default in the due and punctual payment of the principal of or the interest
on any Debt (other than the Loans made hereunder) with Bank secured or unsecured, or in the due performance or observance of any
covenant or condition of any agreement executed in connection therewith, and such default shall have continued beyond any period
of grace or cure provided with respect thereto;

 

    	Loan Agreement	Page 28

    	 

    

  

9.9.          Dissolution.
The dissolution of Borrower or any other Obligated Party for any reason whatsoever;

 

9.10.        Defaults
on Other Debt or Agreements. Borrower shall default in the due and punctual payment of the principal of or the interest on
any Debt owing to any Person (other than Bank) having an aggregate balance (whether or not then due and payable) of $50,000.00
or more, subject to any grace and/or cure periods provided therein; or

 

9.11.        Loan
Documents. Any of the Loan Documents cease to be in full force and effect, or be enforceable by Bank in accordance with their
terms.

 

ARTICLE
10

Certain Rights and Remedies of Bank

 

10.1.         Rights
Upon Event of Default. If any Event of Default shall occur and be continuing, Bank may without notice terminate the Commitment
and declare the Indebtedness or any part thereof to be immediately due and payable, and the same shall thereupon become immediately
due and payable, without notice, demand, presentment, notice of dishonor, notice of acceleration, notice of intent to accelerate,
notice of intent to demand, protest, or other formalities of any kind, all of which are hereby expressly waived by Borrower; provided,
however, that upon the occurrence of an Event of Default under Section 9.5 or Section 9.6, the Commitment
shall automatically terminate, and the Indebtedness shall become immediately due and payable without notice, demand, presentment,
notice of dishonor, notice of acceleration, notice of intent to accelerate, notice of intent to demand, protest, or other formalities
of any kind, all of which are hereby expressly waived by the Borrower. Without limiting the foregoing, if any Event of Default
shall occur and be continuing, Bank may exercise all rights and remedies available to it in law or in equity, under the Loan Documents,
or otherwise and in no event shall Bank be required to foreclose on the Collateral prior to exercising any of such rights and
remedies.

 

10.2.        Rights
Relating to Collateral.

 

10.2.1     Application
of Proceeds. If any Event of Default shall have occurred and be continuing, Bank may at its discretion, in accordance and as
provided in the Code and other applicable law, apply or use any cash held by Bank as Collateral and any cash proceeds received
by Bank in respect of any sale or other disposition of, collection from, or other realization upon, all or any part of the Collateral
as follows in such order and manner as Bank may elect:

 

(a)          To
the repayment or reimbursement of the costs and expenses (including, without limitation, reasonable attorneys’ fees and expenses)
incurred by Bank in connection with (i) the administration of the Loan Documents, (ii) the custody, preservation, use or operation
of, or the sale of, collection from, or other realization upon, the Collateral, and (iii) the exercise or enforcement of any
of the rights and remedies of Bank hereunder;

 

(b)          To
the payment or other satisfaction of any Liens upon the Collateral;

 

(c)          To
the satisfaction of the Indebtedness;

 

(d)          To
the payment of any other amounts required by applicable law; and

 

(e)          By
delivery to Borrower or any other party lawfully entitled to receive such cash or proceeds whether by direction of a court of competent
jurisdiction or otherwise.

 

    	Loan Agreement	Page 29

    	 

    

 

10.2.2           Deficiency.
In the event that the proceeds of any sale of, collection from, or other realization upon, all or any part of the Collateral by
Bank are insufficient to pay all amounts to which Bank is legally entitled, Borrower and any Obligated Party shall be liable for
the deficiency, together with interest thereon as provided in the Loan Documents.

 

10.2.3           Non-Judicial
Remedies. In granting to Bank the power to enforce its rights hereunder without prior judicial process or judicial hearing,
Borrower expressly waives, renounces and knowingly relinquishes any legal right which might otherwise require Bank to enforce its
rights by judicial process. Borrower recognizes and concedes that non-judicial remedies are consistent with the usage of trade,
are responsive to commercial necessity and are the result of a bargain at arm’s length. Nothing herein is intended to prevent
Bank or Borrower from resorting to judicial process at either party’s option.

 

10.2.4           Other
Recourse. Borrower waives any right to require Bank to proceed against any third party, exhaust any Collateral or other security
for the Indebtedness, or to have any third party joined with Borrower in any suit arising out of the Indebtedness or any of the
Loan Documents, or pursue any other remedy available to Bank. Borrower further waives any and all notice of acceptance of this
Agreement. Borrower further waives any defense arising by reason of any disability or other defense of any third party or by reason
of the cessation from any cause whatsoever of the liability of any third party.

 

10.2.5           Disclaimer
of Warranties and Sales on Credit. In connection with any foreclosure sale of the Collateral, Bank may specifically disclaim
any warranties of title or the like. This procedure will not be considered to adversely affect the commercial reasonableness of
any sale of the Collateral. If Bank sells any of the Collateral upon credit, Borrower will be credited only with payments actually
made by the purchaser, received by Bank and applied to the indebtedness of the purchaser. In the event the purchaser fails to pay
for the Collateral, Bank may resell the Collateral and Borrower shall be credited with the proceeds of the sale.

 

10.2.6           License.
Bank is hereby granted a license or other right to use, following the occurrence and continuance of an Event of Default, without
charge, Borrower’s labels, patents, copyrights, rights of use of any name, trade secrets, trade names, trademarks, service
marks, customer lists and advertising matter, or any property of a similar nature, as it pertains to the Collateral, in completing
production of, advertising for sale, and selling any Collateral, and, following the occurrence and continuance of any Event of
Default, Borrower’s rights under all licenses and all franchise agreements shall inure to Bank’s benefit.

 

10.3.        Setoff.
Upon the occurrence and during the continuance of an Event of Default, Bank shall be entitled to exercise the Rights of setoff
and/or banker’s lien against the interests of Borrower in and to each and every account and other property of Borrower which
are in the possession of Bank to the extent of the full amount of the Indebtedness, whether or not any such Indebtedness is then
due. The rights and remedies of Bank hereunder are in addition to other rights and remedies (including, without limitation, other
rights of setoff) which Bank may have.

 

10.4.        Performance
by Bank. Should any covenant, duty, or agreement of Borrower fail to be performed in accordance with the terms of the Loan
Documents, Bank may, at its option, perform or attempt to perform such covenant, duty, or agreement on behalf of Borrower. In such
event, or if Bank expends any sum pursuant to the exercise of any Right provided herein, Borrower shall, at the request of Bank,
promptly pay to Bank any amount expended by Bank in such performance or attempted performance, together with interest thereon at
the Maximum Rate from the date of such expenditure by Bank until paid. Notwithstanding the foregoing, it is expressly understood
that Bank does not assume any liability or responsibility for the performance of any duties of Borrower or Guarantor hereunder
or in connection with all or any part of the Collateral.

 

10.5.        Diminution
in Collateral Value. Bank does not assume, and shall never have, any liability or responsibility for any loss or diminution
in the value of all or any part of the Collateral.

 

    	Loan Agreement	Page 30

    	 

    

  

10.6.        Bank
Not In Control. None of the covenants or other provisions contained in this Agreement shall, or shall be deemed to, give Bank
the Right to exercise control over the affairs and/or management of Borrower, the power of Bank being limited to the Right to exercise
the remedies provided in the other Sections of this Article; provided that, if Bank becomes the owner of any ownership interest
of any Person, whether through foreclosure or otherwise, Bank shall be entitled to exercise such legal Rights as it may have by
virtue of being an owner of such Person.

 

10.7.        Waivers.
The acceptance of Bank at any time and from time to time of part payment on the Indebtedness shall not be deemed to be a waiver
of any Event of Default then existing. No waiver by Bank of any Event of Default shall be deemed to be a waiver of any other then-existing
or subsequent Event of Default. No waiver by Bank of any of its Rights hereunder, in the other Loan Documents, or otherwise shall
be considered a waiver of any other or subsequent Right of Bank. No delay or omission by Bank in exercising any Right under the
Loan Documents shall impair such Right or be construed as a waiver thereof or any acquiescence therein, nor shall any single or
partial exercise of any such Right preclude other or further exercise thereof, or the exercise of any other Right under the Loan
Documents or otherwise.

 

10.8.        Cumulative
Rights. All Rights available to Bank under the Loan Documents shall be cumulative of and in addition to all other Rights granted
to Bank at Law or in equity, whether or not the Obligations be due and payable and whether or not Bank shall have instituted any
suit for collection, foreclosure, or other action under or in connection with the Loan Documents.

 

10.9.        INDEMNIFICATION
OF BANK. BORROWER SHALL INDEMNIFY BANK, EACH AFFILIATE OF BANK AND EACH OF ITS AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES,
ATTORNEYS, AND AGENTS FROM, AND HOLD EACH OF THEM HARMLESS AGAINST, ANY AND ALL LOSSES, LIABILITIES, CLAIMS, DAMAGES, PENALTIES,
JUDGMENTS, DISBURSEMENTS, COSTS, AND EXPENSES (INCLUDING ATTORNEYS’ FEES) TO WHICH ANY OF THEM MAY BECOME SUBJECT WHICH DIRECTLY
OR INDIRECTLY ARISE FROM OR RELATE TO (A) THE NEGOTIATION, EXECUTION, DELIVERY, PERFORMANCE, ADMINISTRATION, OR ENFORCEMENT OF
ANY OF THE LOAN DOCUMENTS, (B) ANY OF THE TRANSACTIONS CONTEMPLATED BY THE LOAN DOCUMENTS, (C) ANY BREACH BY BORROWER OR ANY OTHER
OBLIGATED PARTY OF ANY REPRESENTATION, WARRANTY, COVENANT, OR OTHER AGREEMENT CONTAINED IN ANY OF THE LOAN DOCUMENTS, (D) THE PRESENCE,
RELEASE, THREATENED RELEASE, DISPOSAL, REMOVAL, OR CLEANUP OF ANY HAZARDOUS MATERIAL LOCATED ON, ABOUT, WITHIN OR AFFECTING ANY
OF THE PROPERTIES OR ASSETS OF THE BORROWER OR ANY SUBSIDIARY, (E) THE USE OR PROPOSED USE OF ANY LETTER OF CREDIT, (F) ANY AND
ALL TAXES, LEVIES, DEDUCTIONS, AND CHARGES IMPOSED ON BANK OR ANY OF BANK’S CORRESPONDENTS IN RESPECT OF ANY LETTER OF CREDIT,
(G) ANY INVESTIGATION, LITIGATION, OR OTHER PROCEEDING, INCLUDING, WITHOUT LIMITATION, ANY THREATENED INVESTIGATION, LITIGATION,
OR OTHER PROCEEDING, RELATING TO ANY OF THE FOREGOING, OR (H) ANY HEDGE AGREEMENT. WITHOUT LIMITING ANY PROVISION OF THIS AGREEMENT
OR OF ANY OTHER LOAN DOCUMENT, IT IS THE EXPRESS INTENTION OF THE PARTIES HERETO THAT EACH PERSON TO BE INDEMNIFIED UNDER THIS
SECTION SHALL BE INDEMNIFIED FROM AND HELD HARMLESS AGAINST ANY AND ALL LOSSES, LIABILITIES, CLAIMS, DAMAGES, PENALTIES, JUDGMENTS,
DISBURSEMENTS, COSTS, AND EXPENSES (INCLUDING ATTORNEYS’ FEES) ARISING OUT OF OR RESULTING FROM THE SOLE CONTRIBUTORY OR
ORDINARY NEGLIGENCE OF SUCH PERSON; PROVIDED, HOWEVER, THE INDEMNITIES PROVIDED IN THIS SECTION 10.9 DO NOT
EXTEND TO LOSSES, LIABILITIES, CLAIMS, OR DAMAGES CAUSED SOLELY BY BANK’S GROSS NEGLIGENCE OR MISCONDUCT.

 

    	Loan Agreement	Page 31

    	 

    

  

10.10.      Limitation
of Liability. Neither Bank nor any Affiliate, officer, director, employee, attorney, or agent of Bank shall have any liability
with respect to, and Borrower hereby waives, releases, and agrees not to sue any of them upon, any claim for any special, indirect,
incidental, or consequential damages suffered or incurred by the Borrower in connection with, arising out of, or in any way related
to, this Agreement or any of the other Loan Documents, or any of the transactions contemplated by this Agreement or any of the
other Loan Documents. Borrower hereby waives, releases, and agrees not to sue Bank or any of Bank’s Affiliates, officers,
directors, employees, attorneys, or agents for punitive damages in respect of any claim in connection with, arising out of, or
in any way related to, this Agreement or any of the other Loan Documents, or any of the transactions contemplated by this Agreement
or any of the other Loan Documents. 

 

10.11.      Servicing
Rights. Upon the occurrence of an Event of Default, Bank will have the ability to immediately take over and control all servicing
rights for the Mortgage Paper assigned and pledged to the Bank without further cure by Borrower.

 

ARTICLE
11

Miscellaneous

 

11.1.       Headings.
The headings, captions, and arrangements used in any of the Loan Documents are, unless specified otherwise, for convenience only
and shall not be deemed to limit, amplify, or modify the terms of the Loan Documents, nor affect the meaning thereof.

 

11.2.       Articles,
Sections, and Exhibits. All references to “Article,” “Articles,” “Section,” “Sections,”
“Subsection,” or “Subsections” contained herein are, unless specifically indicated otherwise, references
to articles, sections, and subsections of this Agreement. All references to “Exhibits” contained herein are references
to exhibits attached hereto, all of which are made a part hereof for all purposes, the same as if set forth herein verbatim, it
being understood that if any exhibit attached hereto, which is to be executed and delivered, contains blanks, the same shall be
completed correctly and in accordance with the terms and provisions contained and as contemplated herein prior to or at the time
of the execution and delivery thereof.

 

11.3.       Number
and Gender of Words. Whenever herein the singular number is used, the same shall include the plural where appropriate, and
vice versa; and words of any gender shall include each other gender where appropriate.

 

11.4.       Notices.
Unless otherwise expressly provided herein, all notices and other communications provided for hereunder shall be in writing (including
by facsimile transmission) and mailed, faxed, or delivered, to the address or facsimile number specified for notices on the signature
page below or to such other address as shall be designated by such party in a notice to the other parties. All such other notices
and other communications shall be deemed to have been given or made upon the earliest to occur of (a) actual receipt by the intended
recipient or (b) (i) if delivered by hand or courier, when signed for by the designated recipient; (ii) if delivered by mail, three
(3) business days after deposit in the mail, postage prepaid; and (iii) if delivered by facsimile, when sent and receipt has been
confirmed. Electronic mail and internet websites may be used only to distribute only routine communications, such as financial
statements and other information, and to distribute Loan Documents for execution by the parties thereto, and may not be used for
any other purpose.

 

11.5.       Form
and Number of Documents. Each agreement, document, instrument, or other writing to be furnished to Bank under any provision
of this Agreement must be in form and substance and in such number of counterparts as may be satisfactory to Bank and its counsel.

 

    	Loan Agreement	Page 32

    	 

    

  

11.6.       Survival.
All covenants, agreements, undertakings, representations, and warranties made in any of the Loan Documents shall survive all closings
under the Loan Documents and shall continue in full force and effect so long as any part of the Indebtedness remains outstanding
and, except as otherwise indicated, shall not be affected by any investigation made by any party. Notwithstanding anything contained
herein to the contrary, the covenants, agreements, undertakings, representations, and warranties made in Section 6.5 and
Section 10.9 shall survive the expiration or termination of this Agreement, regardless of the means of such expiration or
termination.

 

11.7.       GOVERNING
LAW; PLACE OF PERFORMANCE. THE LOAN DOCUMENTS ARE BEING EXECUTED AND DELIVERED, AND ARE INTENDED TO BE PERFORMED, IN THE STATE
OF TEXAS, AND THE LAWS OF SUCH STATE AND OF THE UNITED STATES SHALL GOVERN THE RIGHTS AND DUTIES OF THE PARTIES HERETO AND THE
VALIDITY, CONSTRUCTION, ENFORCEMENT, AND INTERPRETATION OF THE LOAN DOCUMENTS, EXCEPT TO THE EXTENT OTHERWISE SPECIFIED IN ANY
OF THE LOAN DOCUMENTS. THIS AGREEMENT, ALL OF THE OTHER LOAN DOCUMENTS, AND ALL OF THE OBLIGATIONS OF BORROWER UNDER ANY OF THE
LOAN DOCUMENTS ARE PERFORMABLE IN DALLAS COUNTY, TEXAS. VENUE OF ANY LITIGATION INVOLVING THIS AGREEMENT OR ANY LOAN DOCUMENT SHALL
BE MAINTAINED IN AN APPROPRIATE STATE OR FEDERAL COURT LOCATED IN DALLAS COUNTY, TEXAS, TO THE EXCLUSION OF ALL OTHER VENUES.

 

11.8.       Maximum
Interest. It is expressly stipulated and agreed to be the intent of Borrower and Bank at all times to comply strictly with
the applicable Texas law governing the maximum rate or amount of interest payable on the indebtedness evidenced by any Note or
any Loan Document, and the Related Indebtedness (or applicable United States federal law to the extent that it permits Bank to
contract for, charge, take, reserve or receive a greater amount of interest than under Texas law). If the applicable law is ever
judicially interpreted so as to render usurious any amount (a) contracted for, charged, taken, reserved or received pursuant to
any Note, any of the other Loan Documents or any other communication or writing by or between Borrower and Bank related to the
transaction or transactions that are the subject matter of the Loan Documents, (b) contracted for, charged, taken, reserved or
received by reason of Bank’s exercise of the option to accelerate the maturity of any Note and/or any and all indebtedness
paid or payable by Borrower to Bank pursuant to any Loan Document other than any Note (such other indebtedness being referred
to in this Section as the “Related Indebtedness”), or (c) Borrower will have paid or Bank will have received by reason
of any prepayment by Borrower of any Note or Related Indebtedness, then it is Borrower’s and Bank’s express intent
that all amounts charged in excess of the Maximum Rate shall be automatically canceled, ab initio, and all amounts in excess
of the Maximum Rate theretofore collected by Bank shall be credited on the principal balance of any Note and/or the Related Indebtedness
(or, if any Note and the Related Indebtedness have been or would thereby be paid in full, refunded to Borrower), and the provisions
of any Note and the other Loan Documents shall immediately be deemed reformed and the amounts thereafter collectible hereunder
and thereunder reduced, without the necessity of the execution of any new document, so as to comply with the applicable law, but
so as to permit the recovery of the fullest amount otherwise called for hereunder and thereunder; provided, however,
if any Note has been paid in full before the end of the stated term of any such Note, then Borrower and Bank agree that Bank shall,
with reasonable promptness after Bank discovers or is advised by Borrower that interest was received in an amount in excess of
the Maximum Rate, either refund such excess interest to Borrower and/or credit such excess interest against such Note and/or any
Related Indebtedness then owing by Borrower to Bank. Borrower hereby agrees that as a condition precedent to any claim or counterclaim
(in which event such proceeding shall be abated for such time period) seeking usury penalties against Bank, Borrower will provide
written notice to Bank, advising Bank in reasonable detail of the nature and amount of the violation, and Bank shall have sixty
(60) days after receipt of such notice in which to correct such usury violation, if any, by either refunding such excess interest
to Borrower or crediting such excess interest against the Note to which the alleged violation relates and/or the Related Indebtedness
then owing by Borrower to Bank. All sums contracted for, charged, taken, reserved or received by Bank for the use, forbearance
or detention of any debt evidenced by any Note and/or the Related Indebtedness shall, to the extent permitted by applicable law,
be amortized or spread, using the actuarial method, throughout the stated term of such Note and/or the Related Indebtedness (including
any and all renewal and extension periods) until payment in full so that the rate or amount of interest on account of any Note
and/or the Related Indebtedness does not exceed the Maximum Rate from time to time in effect and applicable to such Note and/or
the Related Indebtedness for so long as debt is outstanding. In no event shall the provisions of Chapter 346 of the Texas Finance
Code (which regulates certain revolving credit loan accounts and revolving triparty accounts) apply to any Note and/or any of
the Related Indebtedness. Notwithstanding anything to the contrary contained herein or in any of the other Loan Documents, it
is not the intention of Bank to accelerate the maturity of any interest that has not accrued at the time of such acceleration
or to collect unearned interest at the time of such acceleration.

 

    	Loan Agreement	Page 33

    	 

    

  

11.9.       Ceiling
Election. To the extent that Bank is relying on Chapter 303 of the Texas Finance Code to determine the Maximum Rate payable
on any such Note and/or any other portion of the Indebtedness, Bank will utilize the weekly ceiling from time to time in effect
as provided in such Chapter 303, as amended. To the extent federal law permits Bank to contract for, charge, take, receive or reserve
a greater amount of interest than under Texas law, Bank will rely on federal law instead of such Chapter 303 for the purpose of
determining the Maximum Rate. Additionally, to the extent permitted by applicable law now or hereafter in effect, Bank may, at
its option and from time to time, utilize any other method of establishing the Maximum Rate under such Chapter 303 or under other
applicable law by giving notice, if required, to Borrower as provided by applicable law now or hereafter in effect.

 

11.10.     Invalid
Provisions. If any provision of any of the Loan Documents is held to be illegal, invalid, or unenforceable under present or
future Laws effective during the term thereof, such provision shall be fully severable, the appropriate Loan Document shall be
construed and enforced as if such illegal, invalid, or unenforceable provision had never comprised a part thereof, and the remaining
provisions thereof shall remain in full force and effect and shall not be effected by the illegal, invalid, or unenforceable provision
or by its severance therefrom. Furthermore, in lieu of such illegal, invalid, or unenforceable provision, there shall be added
automatically as a part of such Loan Document a provision as similar in terms to such illegal, invalid, or unenforceable provision
as may be possible and be legal, valid, and enforceable.

 

11.11.     Entirety
and Amendments. This instrument embodies the entire agreement between the parties relating to the subject matter hereof (except
documents, agreements and instruments delivered or to be delivered in accordance with the express terms hereof), supersedes all
prior agreements and understandings, if any, relating to the subject matter hereof, and may be amended only by an instrument in
writing executed jointly by Borrower and Bank and supplemented only by documents delivered or to be delivered in accordance with
the express terms hereof.

 

11.12.     Multiple
Counterparts. This Agreement has been executed in a number of identical counterparts, each of which constitutes an original
and all of which constitute, collectively, one agreement; but in making proof of this Agreement, it shall not be necessary to produce
or account for more than one such counterpart.

 

11.13.     Parties
Bound. This Agreement shall be binding upon and inure to the benefit of Borrower, Bank and their respective successors and
assigns; provided that Borrower may not, without the prior written consent of Bank, assign any of its Rights, duties, or
obligations hereunder. No term or provision of this Agreement shall inure to the benefit of any Person other than Borrower and
Bank and their respective successors and assigns; consequently, no Person other than Borrower and Bank and their respective successors
and assigns, shall be entitled to rely upon, or to raise as a defense, in any manner whatsoever, the failure of Borrower or Bank
to perform, observe, or comply with any such term or provision.

 

11.14.     Bank’s
Consent or Approval. Except where otherwise expressly provided in the Loan Documents, in any instance where the approval, consent
or the exercise of judgment of Bank is required, the granting or denial of such approval or consent and the exercise of such judgment
shall be (a) within the sole and absolute discretion of Bank, and (b) deemed to have been given only by a specific writing intended
for the purpose and executed by Bank. Each provision for consent, approval, inspection, review, or verification by Bank is for
Bank’s own purposes and benefit only.

 

    	Loan Agreement	Page 34

    	 

    

 

 

11.15.     Loan
Agreement Governs. In the event of any conflict between the terms of this Agreement and any terms of any other Loan Document,
the terms of this Agreement shall govern. All of the Loan Documents are by this reference incorporated into this Agreement.

 

11.16.     WAIVER
OF JURY TRIAL. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, BORROWER HEREBY IRREVOCABLY AND EXPRESSLY WAIVES ALL RIGHT
TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT, TORT, OR OTHERWISE) ARISING OUT OF
OR RELATING TO ANY OF THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY OR THE ACTIONS OF BANK IN THE NEGOTIATION, ADMINISTRATION,
OR ENFORCEMENT THEREOF.

 

11.17.     Independence
of Covenants. All covenants hereunder shall be given independent effect so that if a particular action or condition is not
permitted by any of such covenants, the fact that it would be permitted by an exception to, or be otherwise within the limitations
of, another covenant shall not avoid the occurrence of a Default if such action is taken or such condition exists.

 

11.18.     USA
Patriot Act. Bank is subject to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October
26, 2001)) (the “Act”) and hereby notifies the Borrower that pursuant to the requirements of
the Act, it is required to obtain, verify, and record information that identifies the Borrower, which information includes the
name and address of the Borrower and other information that will allow such Bank to identify the Borrower in accordance with the
Act.

 

11.19.     STATUTE
OF FRAUDS NOTICE. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT 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.

 

11.20.     Partial
Releases. Borrower may request Bank in writing, from time to time, but in no event in excess of four (4) times in any calendar
month, to partially release Bank’s liens and security interest in a Mortgage Loan pledged to the Bank (i.e., Bank will reassign
without warranty or recourse such Mortgage Loan to Borrower). Any such partial release shall be conditioned upon:

 

(i)          receipt
by Bank of a written request for such release at least five (5) days prior to the date the Bank is requested to execute and deliver
the partial release;

 

(ii)         such
partial release is in form and substance acceptable to Bank and is documented, recorded and otherwise accomplished without cost
to Bank;

 

(iii)        receipt
by Bank of a payment from Borrower, in good and immediately available funds, in an amount, acceptable to Bank, to repay the amount
necessary for Borrower to be in compliance with the Borrowing Base (as calculated after giving effect to such partial release);
and

 

(iv)      at the time of the
partial release and after giving effect thereto, no event or condition exists which constitutes, or with notice or lapse of time
(or both) would constitute, an Event of Default.

 

[Remainder of Page Intentionally Left Blank]

 

    	Loan Agreement	Page 35

    	 

    

 

EXECUTED to be effective
as of the date first written above.

 

	 	BANK:
	 	 
	 	VERITEX COMMUNITY BANK
	 	 
	 	/s/ Adam Garbe
	 	Adam Garbe, Vice President
	 	 
	 	Address for Notices:
	 	 
	 	14885 Preston Road
	 	Dallas, Texas 75254
	 	Facsimile:  214/572-2934
	 	 
	 	With copy to:
	 	 
	 	Liechty & McGinnis, LLP
	 	11910 Greenville Avenue, Suite 400
	 	Dallas, Texas 75243
	 	Attention:  Kristy Bowen, Esq.
	 	Facsimile:  214/265-0615
	 	 
	 	BORROWER:
	 	 
	 	UNITED DEVELOPMENT FUNDING INCOME FUND V, a Maryland real estate investment trust
	 	 
	 	/s/ Hollis M. Greenlaw
	 	Hollis M. Greenlaw
	 	Chief Executive Officer
	 	 
	 	Address for Notices:
	 	 
	 	1301 Municipal Way, Suite 100
	 	Grapevine, Texas 76051
	 	Facsimile: 817/835-0383
	 	Attention:  Ben Wissink or Melissa Youngblood

 

    	Loan Agreement	Page 36

    	 

    

 

INDEX TO EXHIBITS

 

	Exhibit	Description of Exhibit
	 	 
	A	Borrowing Base Certificate
	B	Compliance Certificate
	C	Mortgage Assignment
	D	Allonge
	E	Assignment of Notes and Liens

 

INDEX TO SCHEDULES

 

Description of Schedules

 

Schedule One – Additional Conditions Precedent

Schedule Two – Disclosure Schedule

 

    	Loan Agreement	Page 37

    	 

    

 

EXHIBIT
A

 

BORROWING
BASE CERTIFICATE

 

For Month Ended: ___________________ (the
“Subject Month”)

 

		Bank:	VERITEX COMMUNITY BANK

 

		Borrower:	_______________________

 

This certificate is delivered under the
Loan Agreement (as the same may have been amended, renewed, restated, extended, supplemented or modified from time to time, the
“Agreement”) dated as of November 14, 2014, between Borrower and Bank. Capitalized terms used in this certificate
shall, unless otherwise indicated, have the meanings set forth in the Agreement. On behalf of Borrower, the undersigned certifies
to Bank on the date hereof that (a) no Default or Event of Default has occurred, (b) a review of the activities of Borrower
during the Subject Month has been made under my supervision with a view to determining the amount of the current Borrowing Base,
(c) the Eligible Mortgage Loans included in the Borrowing Base below meet all conditions to qualify for inclusion therein
as set forth in the Agreement, and all representations and warranties set forth in the Agreement and in any other Loan Documents
with respect thereto are true and correct in all respects, and (d) the information set forth below hereto is true and correct
as of the last day of the Subject Month. 

 

	LINE	 	AT END OF

SUBJECT MONTH
	 	 	 
	1.	Total Mortgage Loans (less discounts)	 	$__________
	 	 	 	 
	2.	Ineligible Mortgage Loans	 	 
	 	 	 	 
	 	a.	The Mortgage Paper relating to the Mortgage Loan is not effectively assigned and pledged to Bank or Bank does not have first perfected Lien  or Bank does not approve the Submission Package	
        

        $__________
	 	 
	 	 	 	 	 	 
	 	b.	The original executed Mortgage Note relating to the Mortgage Loan and copies of all other Mortgage Paper related to the Mortgage Loan have not been delivered to Bank or the related Mortgage Note has not been endorsed payable to the order of Bank pursuant to an Allonge executed by Borrower	
        $__________
	 	 
	 	 	 	 	 	 
	 	c.	Bank has not received and approved the appraisal ordered by Bank relating to the Finished Lot or Lot Development Property subject to the Mortgage securing the Mortgage Loan or the appraised value set forth in the appraisal is not acceptable to Bank	
        $__________
	 	 

 

    	Exhibit A-1	 

    	 

    

  

	LINE	 	AT END OF

SUBJECT MONTH
	 	 	 	 	 	 
	 	d.	The Mortgage Loan is not collateralized by real property located in a municipality and subdivision approved by Bank or any builder or third party purchasing or refinancing a Finished Lot or any developer or third party involved in completing the Lot Development has not been approved by Bank	
        

        $__________
	 	 
	 	 	 	 	 	 
	 	e.	The Mortgage Loan is not secured by a first and prior deed of trust lien encumbering a Finished Lot or Lot Development Property	
        

        $__________
	 	 
	 	 	 	 	 	 
	 	f.	The Mortgage Loan does not have a lot sales contract approved by Bank or such lot sales contract is not still in full force and effect and there are defaults thereunder	
        $__________
	 	 
	 	 	 	 	 	 
	 	g.	The Mortgage Loan is secured by a “contract for deed”	$__________	 	 
	 	 	 	 	 	 
	 	h.	The Mortgage Loan is not current or is otherwise in default 	
        $__________
	 	 
	 	 	 	 	 	 
	 	i.	The Mortgage Paper relating to the Mortgage Loan has been altered, modified or amended in a manner which has not been approved by Bank	
        $__________
	 	 
	 	 	 	 	 	 
	 	j.	If the Mortgage Loan is a Lot Development Loan, (i) the Mortgage
Note evidencing to the Mortgage Loan has been outstanding for more than thirty-six (36) months from the date Bank first approves
an Advance Request for such Mortgage Loan, (ii) the obligors under the Mortgage Loan have begun Lot Development within twelve (12)
months from the date Bank first approves an Advance Request for such Mortgage Loan, and (iii) the Mortgage Loan has not been converted
to a Finished Lot Loan

	
        $__________
	 	 
	 	 	 	 	 	 
	 	k.	If the Mortgage Loan is a Finished Lot Loan, the Mortgage Note
evidencing to the Mortgage Loan has been outstanding for more than eighteen (18) months from the date Bank first approves an Advance
Request for such Mortgage Loan

	
        $__________
	 	 

 

    	Exhibit A-2	 

    	 

    

  

	LINE	 	AT END OF

SUBJECT MONTH
	 	 	 
	 	l.	If the Mortgage Loan is a Lot Development Loan, the outstanding principal amount of the Mortgage Loan exceeds one hundred percent (100%) of the acquisition cost of the Lot Development Property and the construction costs for the Lot Development as reflected it the Lot Development Budget approved by the Bank	
        $__________
	 	 
	 	 	 	 	 	 
	 	m.	The Mortgage Note or the Mortgage relating to the Mortgage Loan is not genuine or is not the legal, valid, binding and enforceable obligations of a Mortgage Loan Obligor, or is subject to a right of rescission, set-off, counterclaim or defense	
        $__________
	 	 
	 	 	 	 	 	 
	 	n.	The Mortgage Note relating to the Mortgage Loan has been extinguished under relevant state law in connection with a judgment of foreclosure, deed-in-lieu of foreclosure sale, foreclosure sale or otherwise	
        

        $__________
	 	 
	 	 	 	 	 	 
	 	o.	The Mortgage relating to the Mortgage Loan is not insured as a first and prior lien on the mortgaged property covered thereby by a loan policy of title insurance to be issued by a title insurance company acceptable to Bank in an amount not less than the original principal amount of the Mortgage Note secured thereby	
        

        $__________
	 	 
	 	 	 	 	 	 
	 	p.	The mortgaged property subject to the Mortgage relating to the Mortgage Loan is subject to a foreclosure or receivership proceeding or other similar proceeding	
        $__________
	 	 
	 	 	 	 	 	 
	 	q.	The Mortgage Loan Obligor or any guarantor has not been approved by Bank, is no longer approved by Bank or Mortgage Loan Obligor or any guaranor of the Mortgage Loan is subject to a bankruptcy or insolvency proceeding	
        

        $__________
	 	 
	 	 	 	 	 	 
	 	r.	There is litigation, proceeding or governmental investigation pending or threatened related to the Mortgage Loan 	
        

        $__________
	 	 
	 	 	 	 	 	 
	 	s.	Borrower has not received written notice from Bank that it has reviewed and approved the Submission Package for the Mortgage Loan	
        

        $__________
	 	 

 

    	Exhibit A-3	 

    	 

    

  

	LINE	 	AT END OF

SUBJECT MONTH
	 	 	 	 	 	 
	 	t.	The Mortgage Loan was not originated by Bank or otherwise approved in writing by Bank	
        

        $__________
	 	 
	 	 	 	 	 	 
	 	u.	If the Mortgage Loan is a Lot Development Loan, construction of the Lot Development has not commenced and is not being prosecuted with diligence and continuity in accordance with the plans and specifications and all applicable laws	
        $__________
	 	 
	 	 	 	 	 	 
	3.	Total Ineligible Mortgage Loans

add Lines 2(a) through 2(u)	 	 	
        

        $__________

	 	 	 	 	 
	4.	Total Eligible Mortgage Loans (See Schedule attached for unpaid principal balance of each Eligible Mortgage Loans)

Line 1 minus Line 3	 	 	
        

        $__________

	 	 	 	 	 
	5.	Multiplied by:  Borrowing Base factor	 	 	50%
	 	 	 	 	 
	6.	Borrowing Base (for Unpaid Principal of Eligible Mortgage Loans)

Line 4 x Line 5	 	 	
        

        $__________

	 	 	 	 	 
	7.	Total of appraised value of each Finished Lot or Lot Development Property subject to a Mortgage	 	 	
        

        $__________

	 	 	 	 	 
	8.	Multiplied by:  Borrowing Base Factor	 	 	50%
	 	 	 	 	 
	9.	
        Borrowing Base (for Appraised Value)

        Line 7 x Line 8
	 	 	
        

        $__________

	 	 	 	 	 
	10.	Borrowing Base (lesser of Line 6 or Line 9)	 	 	$__________
	 	 	 	 	 
	11.	Amount of Commitment	 	 	$10,000,000.00
	 	 	 	 	 
	12.	Principal Balance of Note	 	 	$__________
	 	 	 	 	 
	13.	
        Borrowing Limit

        (lesser of Line 10 or Line 11)*
	 	 	
        

        $__________

	 	 	 	 	 
	14.	
        Line 14 – Line 12

        (Amount available for Advances, if positive, or amount to be
        repaid, if negative)
	 	 	$__________

 

*Subject to reduction based upon
the Related Borrower Funding Limitation

 

    	Exhibit A-4	 

    	 

    

 

	 	 
	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

  

    	Exhibit A-5	 

    	 

    

 

EXHIBIT
B

 

COMPLIANCE
CERTIFICATE

 

FOR [MONTH] [QUARTER] ENDED
[______] [(THE “SUBJECT MONTH”)] [(THE “SUBJECT QUARTER”)]

 

		BANK:	VERITEX BANK

 

		BORROWER:	________________________

 

This Certificate is
delivered under the Loan Agreement (the “Agreement”) dated as of November 14, 2014, between Borrower and Bank
as such may have been amended, supplemented or replaced. Capitalized terms used in this Certificate shall, unless otherwise indicated,
have the meanings set forth in the Agreement. On behalf of Borrower, the undersigned certifies to Bank on the date hereof that
(a) no Default or Event of Default has occurred and is continuing, (b) all representations and warranties of Borrower contained
in the Agreement and in the other Loan Documents are true and correct in all material respects, and (c) the information set forth
below hereto is true and correct as of the last day of the Subject [Month] [Quarter]:

 

	 	DESCRIPTION OF COVENANT	 	CALCULATION
    AS OF          , 20     
	 	 	 	 
	(1)	Leverage Ratio of not greater than

1.0 to 1.0 (Section 8.1 of Agreement)	 	

                                           to 1.0   
	 	 	 	 
	(2)	 	 

 

	 	 
	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

  

    	Exhibit B-1	 

    	 

    

 

EXHIBIT
C

 

mortgage
assignment

 

		STATE OF TEXAS	)

		COUNTY OF _____________	)

 

THAT UNITED DEVELOPMENT
FUNDING INCOME FUND V, a Maryland real estate investment trust (“Assignor”), for and in consideration of
the sum of Ten and 00/100 Dollars ($10.00) in hand paid to Assignor by VERITEX COMMUNITY BANK (“Assignee”),
the receipt and sufficiency of which are hereby acknowledged and confessed, has, with full recourse and warranty, SOLD, ASSIGNED,
TRANSFERRED, ENDORSED and DELIVERED, and by these presents does hereby, with recourse, SELL, ASSIGN, TRANSFER, ENDORSE, and DELIVER
unto Assignee the certain promissory note(s) (as subsequently renewed, extended and modified, the “Notes”) described
as follows:

 

See Exhibit “A”
attached hereto and made part hereof by reference.

 

For the same consideration,
Assignor has BARGAINED, SOLD, ASSIGNED, TRANSFERRED and CONVEYED, and does hereby BARGAIN, SELL, ASSIGN, TRANSFER and CONVEY unto
Assignee, all right, title and interest in and to any and all guarantees, mortgages, deeds of trust, security agreements, liens,
mortgagee title insurance policies and interest in and to any and all guarantees, Mortgages, deeds of trust, security agreements,
liens, mortgagee title insurance policies and equities existing and to exist in connection with or as security for the Notes, including,
without limitation, those certain deed of trust and mortgage instruments described on Exhibit “A” attached
hereto and made part hereof by reference (the “Collateral Security”).

 

This Assignment incorporates
all of the covenants, representations and warranties with respect to the Notes and the Collateral Security contained in that certain
Collateral Assignment of Notes and Liens and Security Agreement dated as of _________________, 201_ executed by Assignor in favor
of Assignee which shall inure to the benefit of Assignee and Assignee’s successors and assigns.

 

    	Exhibit C-1	 

    	 

    

 

IN WITNESS WHEREOF,
Assignor has caused this instrument to be executed as of (although not necessarily on) the ____ day of________________, 201_.

 

	 	ASSIGNOR:
	 	 
	 	 
	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

 

	STATE OF TEXAS	§
	 	§
	COUNTY OF ____________	§

 

This instrument was
acknowledged before me on the _____ day of _________________, 201_, by ____________________ the ________________ of __________________,
a _______________________, on behalf of said entity.

 

	 	 
	 	Notary Public, State of Texas
	 	 
	(SEAL)	 
	 	Printed Name

 

    	Exhibit C-2	 

    	 

    

 

EXHIBIT
A to

 

mortgage
assignment

 

    	Exhibit C-3	 

    	 

    

 

EXHIBIT
D

 

form
of allonge to promissory note

 

Allonge
to promissory note

 

This Allonge to Promissory Note is hereby
attached to and made a part of that certain Promissory Note dated ___________________, 201_ (as amended, restated, supplemented
or otherwise modified, the “Note”), executed by __________________, payable to the order of _________________________,
in the original principal amount of $___________________. It is intended that this Allonge to Promissory Note be attached to and
made a permanent part of the Note.

 

PAY TO THE ORDER OF VERITEX COMMUNITY BANK, WITH FULL
RECOURSE.

 

Executed as of the ___ day of ___________, 201__.

 

	 	 
	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

  

    	Exhibit D-1	 

    	 

    

 

EXHIBIT
E

 

form
of assignment of noteS and liens

 

[sEE
ATTACHED.]

 

 

    	Exhibit E-1	 

    	 

    

 

SCHEDULE ONE

 

ADDITIONAL
CONDITIONS PRECEDENT

 

Borrower
shall have furnished to Bank customer identification information, verification and such other information and supporting documentation
regarding Borrower, each Guarantor, and each person with authority or control with respect to Borrower and each Guarantor, as Bank
shall reasonably require for purposes of complying with the provisions of the Bank Secrecy Act (31 U.S.C. 5311 et. Seq.), as amended
by the USA PATRIOT ACT (Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism
Act of 2001, Pub. L. 107-56), and Bank’s policies and procedures implemented in accordance therewith.

 

    	Schedule One	 

    	 

    

 

SCHEDULE
TWO

 

DISCLOSURE
SCHEDULE

 

Permitted Liens Not Otherwise Disclosed:
None

 

Tradenames (Sections 5.1): None

 

Tribunal Proceedings (Section 5.4):
None

 

Subsidiaries (Section 5.10): None

 

Other Debt (Section 5.11): None

 

Environmental Matters (Section 5.13):
None

 

Locations (Section 5.14): None

 

Intellectual Property (Section 5.16):
None

 

Exceptions
to Transactions with Affiliates (Section 7.8): 

 

		1.	Advisory Agreement dated effective the 25th
day of July, 2014 executed by and between United Development Funding Income Fund V, a Maryland real estate investment trust,
UDF V OP, L.P., a Delaware limited partnership, and American Realty Capital Residential Advisors, LLC, a Delaware limited liability
company.

 

		2.	Allocation Policy Agreement dated effective the
25th day of July, 2014, executed by and among United Development Funding, L.P., a Delaware limited partnership, United
Development Funding II, L.P., a Delaware limited partnership, United Development Funding III, L.P., a Delaware limited partnership,
United Development Funding IV, a Maryland real estate investment trust, United Development Funding Land Opportunity Fund, L.P.,
a Delaware limited partnership, United Development Funding Income Fund V, a Maryland real estate investment trust, UMTH Land Development,
L.P., a Delaware limited partnership, and UDFH Land Development, L.P., a Delaware limited partnership.

 

    	Schedule Two	 

    	 

    

 

		3.	Sub-Advisory Agreement executed the 25th
day of July, 2014, by and between American Realty Capital Residential Advisors, LLC, a Delaware limited liability company,
and UDFH General Services, L.P., a Delaware limited partnership.

 

		4.	Asset Management Agreement executed the 25th
day of July, 2014, by and between UDFH Land Development, L.P., a Delaware limited partnership, and UDFH General Services,
L.P., a Delaware limited partnership.

 

    	Schedule TwoExhibit 10.6

 

LOAN AGREEMENT

(Frisco 113, Collin County, Texas)

UDF V
Loan # 9001

 

This Loan Agreement
(this “Agreement”) is made and entered into effective as of this the 1st day of December,
2014 (the “Effective Date”) by and among UNITED DEVELOPMENT FUNDING INCOME FUND V, a real
estate investment trust organized under the laws of the State of Maryland (together with its successors and assigns, “Lender”),
CTMGT FRISCO 113, LLC, a Texas limited liability company (“Borrower”),
CENTAMTAR TERRAS, L.L.C., a Texas limited liability company (“Centamtar Terras”),
CTMGT, LLC, a Texas limited liability company (“CTMGT”), and MEHRDAD MOAYEDI, a natural
person residing in Dallas County, Texas (“Moayedi”).

 

RECITALS:

 

A.           Borrower
has requested that Lender extend credit to Borrower as described in this Agreement. Lender is willing to make such credit available
to Borrower upon and subject to the provisions, terms and conditions hereinafter set forth.

 

B.           Subject
to and upon the terms and conditions of this Agreement, Lender has agreed to lend to Borrower the amounts herein described for
the purposes set forth below.

 

AGREEMENT:

 

NOW, THEREFORE, in
consideration of the premises, the covenants, representations, warranties and agreements contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby covenant and agree as follows:

 

1.          Certain
Definitions. Certain terms which are defined in the text of this Agreement shall have the respective meanings given to such
terms herein, and the following terms shall have the following meanings:

 

“Accrued
Interest Payments” means monthly interest payments equal to the amount of accrued interest on the outstanding principal
balance of the Loan, calculated at the applicable rate of interest provided herein, and payable on the last day of each calendar
month for interest accrued during that calendar month, as provided herein.

 

“Advance”
shall mean an advance of funds by Lender to or for the benefit of Borrower under this Agreement including, without limitation,
a Commitment Advance, a Discretionary Advance or Re-Advance.

 

“Advance Conditions”
has the meaning set forth in Section 8 of this Agreement.

 

“Advance
Request” shall mean Lender’s standard form of Advance Request in the form attached hereto as Exhibit “D.”

 

“Affiliate”
shall mean an individual or legal entity that directly or indirectly, through one or more intermediaries, controls or is controlled
by, or is under common control with, another Person. The term “Control” as utilized herein means the
possession, directly or indirectly, of the power to direct or cause direction of the management and policies of a Person, whether
through management, ownership, by contract, or otherwise; provided, however, in no event shall any Lender be deemed
an Affiliate of Borrower or any Borrower-Related Party.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	1

    	 

    

 

“Approved
Budget” means a budget approved by Lender for the management and development of the Property in accordance with the
Development Plan, which specifies the cost by item of all labor, materials, and services necessary for the development of the Property
in accordance with the Development Plan, and all other expenses anticipated by Borrower incident to the Loan, the Property and
such development of the Property. The Approved Budget is attached hereto as Exhibit “F”.

 

“Approved
Builder” means Ryland Homes and each other residential homebuilder acquiring Lots from Borrower for the purpose
of constructing single family residences thereon which is approved by Lender as evidenced by Lender’s written consent.

 

“Approved
Purposes” means the use by Borrower of the Loan to partially fund the purchase and development of the Property.

 

“Assignment
and Subordination Agreement” means, collectively, each Assignment of Lot Sale and Purchase Contract executed by Borrower
in favor of Lender, together with a consent executed by Approved Builder to such assignment and a subordination of its interest
to Lender, as each may be amended, modified, or supplemented from time to time.

 

“Assignment
of Contract Rights” means, collectively, each certain Assignment of Contract Rights executed by Borrower in favor
of Lender assigning Lender all of the rights of Borrower under the Reimbursement Contracts.

 

“Base
Rate” means the lesser of (i) thirteen percent (13%) per annum, accrued at least monthly (on the last day of each
calendar month) and compounded annually on the anniversary of the Loan origination date, or (ii) the Highest Lawful Rate.

 

“Borrower”
means CTMGT Frisco 113, LLC, a Texas limited liability company.

 

“Borrower-Related
Party” means, collectively, the Guarantor, and any other Person who becomes a Guarantor.

 

“Business
Day” means any day other than a Saturday, Sunday, or other day on which Lender is closed for business.

 

“Centamtar
Terras” means Centamtar Terras, L.L.C., a Texas limited liability company.

 

“Closing”
means the execution and delivery of the Loan Documents by Lender, Borrower and the Borrower-Related Parties.

 

“Closing
Deliveries” has the meaning given to such term in Section 7.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	2

    	 

    

 

“Collateral”
means, collectively, all property, assets and rights and all proceeds in which a Lien, in favor of Lender is or has been granted
or arises or has arisen or may hereafter be granted or arise, under or in connection with any Loan Document or otherwise, to secure
payment or performance of all or any part of the Debt. Without limitation of the foregoing, the term “Collateral”
includes, without limitation, (i) all “Mortgaged Property” as such term is defined and used in the Deed of Trust, hereby
incorporated by reference, (ii) all Earnest Money (if any), and the proceeds therefrom, (iii) each Lot Sale Contract (if any) and
the proceeds therefrom, and (iv) each Reimbursement Contract, and the proceeds therefrom.

 

“Commitment”
means the maximum dollar amount that Lender has committed to fund to or for the benefit of Borrower, subject to the Lender Conditions,
in the aggregate dollar amount of U.S. Nine Million Fifty-Six Thousand and No/100 Dollars ($9,056,000.00). The Commitment includes
(and is not in addition to) the Initial Commitment Advance. The Commitment does not include the Interest Reserve.

 

“Commitment
Advance” means any full or partial advance of the Commitment to or for the benefit of Borrower including, without
limitation, the Initial Commitment Advance.

 

“Company
Certificate” means a certificate certifying the existence, good standing, formation and organizational documents,
and authorizing resolutions, of a Person that is an entity.

 

“Construction
Contracts” has the meaning given to such term in Section 10(b).

 

“Contractor”
means each Person contracting with Borrower or an Affiliate thereof to provide labor or materials to or in connection with the
development of the Property.

 

“Contractor’s
Consent” means a written consent in a form acceptable to Lender executed by each Contactor that has entered into
a written Construction Contract with Borrower or its Affiliate for the provision or labor and/or materials to or for the Property.

 

“CTMGT”
means CTMGT, LLC, a Texas limited liability company.

 

“Deed
of Trust” shall mean that certain Deed of Trust, Assignment of Leases and Rents, Security Agreement, and Fixture
Filing to be recorded in the real property records of Collin County, Texas, naming Lender as the beneficiary thereunder and granting
Lender a security interest in and a second priority Lien on the Mortgaged Property in security for the payment and performance
of Borrower’s obligations under this Agreement and the other Loan Documents, subject only to Permitted Exceptions and being
superior in priority over all Liens, as it may be amended, modified, or supplemented from time to time.

 

“Default
Rate” means the lesser of (i) eighteen percent (18%) per annum, accrued at least monthly (on the last day of each
calendar month) and compounded annually on the anniversary of the Loan origination date, or (ii) the Highest Lawful Rate.

 

“Development
Plan” means the site plan and preliminary plat and engineering plans submitted to an appropriate Governmental Authority
involving planned Improvements and specifications for the development of the Property, as prepared by the Borrower’s engineer
and approved in writing by Lender, which materials shall later be supplemented with final plans and drawings approved by Lender.

 

“Discretionary
Advance” has the meaning given to such term in Section 3(c).

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	3

    	 

    

 

“Disposition”
means any sale, lease, transfer, assignment, exchange or conveyance in whole or in part.

 

“District”
means any municipal district of Collin County, Texas having jurisdiction over the Property, being a political subdivision of the
State of Texas, a body politic and corporate, and a governmental agency of the State of Texas, organized pursuant to the provisions
of Article XVI, Section 59 of the Texas Constitution.

 

“Earnest
Money” means any form of earnest money supporting a Lot Sale Contract including, without limitation, any cash on
deposit or letters of credit that may be deposited with a title company, released to Borrower, or held by any other Person.

 

“Earnest
Money Assignment” means an Assignment of Earnest Money Proceeds executed by Borrower in favor of Lender, providing
for a Lien and security interest on the Earnest Money supporting each Lot Sale Contract, in the form approved by Lender in its
sole discretion.

 

“Effective
Date” means December 1, 2014.

 

“Environmental
Indemnity Agreement” shall mean that certain Environmental Indemnity Agreement to be executed by Borrower and the
Guarantor in favor of Lender, pursuant to which Borrower and the Guarantor agree to indemnify Lender from environmental liabilities
associated with the Property, as it may be amended, modified, or supplemented from time to time.

 

“Errors
Agreement” means that certain errors and omissions agreement executed by Borrower and the Borrower-Related Parties
in favor of Lender dated as of the Effective Date.

 

“Event
of Default” has the meaning given to such term in Section 12(a).

 

“Financial
Statement Certifications” means those certain certifications of Borrower and the Guarantor attesting to the accuracy
and completeness of the financial statements in the form attached hereto as Exhibit “E” and incorporated by
reference.

 

“Finished
Lot” means a fully developed finished single-family residential lot owned by Borrower which is deemed by Lender to
be a “finished” single-family residential lot and has been accepted by each of the city in which such Lot is located,
and each municipal district, municipality, water district, municipal utility district, public improvement district or other Governmental
Authority for Collin County, Texas.

 

“Good
Accounting Practice” shall mean such accounting practice as, in the opinion of independent certified public accountants
satisfactory to Lender, conforms at the time to generally accepted accounting principles or, with the prior written consent of
Lender, which may be given or withheld in Lender’s sole discretion, in any applicable case, cash basis of accounting or the
federal income tax basis of accounting, consistently applied. Each accounting term not defined in this Agreement shall have the
meaning given to it under Good Accounting Practice.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	4

    	 

    

 

“Governmental
Authority” shall mean the United States, the State of Texas, the County where the Property, in whole or in part,
is located, the City, if any, where the Property, in whole or in part, is located, the District, any other district where the Property,
in whole or in part, is located, the Texas Commission for Environmental Quality, the Texas Water Development Board, the Texas Water
Quality Board, the Department of Housing and Urban Development, the Environmental Protection Agency, any political subdivision
of any of the foregoing and any agency, department, commission, board, bureau, court or instrumentality of any of them which now
or hereafter has jurisdiction over Lender, Borrower, any Borrower-Related Party, or any part of the Property.

 

“Guarantor”
means, collectively, Mehrdad Moayedi, a natural person residing in Dallas County, Texas, Centamtar Terras, CTMGT, and each other
Person who executes a Guaranty Agreement as a Guarantor thereunder.

 

“Guaranty
Agreement” means each Guaranty executed by a Guarantor in favor of Lender, as each may be amended, modified, or supplemented
from time to time.

 

“Highest
Lawful Rate” means 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 Agreement and the Debt evidenced hereby or by the other Loan Documents which are treated as interest under applicable
law.

 

“Improvements”
means all of the improvements, structures, equipment and amenities to be constructed and/or installed upon the Property in accordance
with the Development Plan and/or the Plans and Specifications.

 

“Indebtedness”
shall mean and include (a) all items which in accordance with Good Accounting Practice would be included on the liability
side of a balance sheet on the date as of which indebtedness is to be determined (excluding capital stock, surplus, surplus reserves
and deferred credits), (b) guaranties, endorsements and other contingent obligations in respect of indebtedness of others,
or any obligations to purchase or otherwise acquire any such indebtedness of others, and (c) indebtedness secured by any mortgage,
pledge, security interest or lien existing on property owned subject to or burdened by such mortgage, pledge, security interest
or lien whether or not the indebtedness secured thereby shall have been assumed.

 

“Initial
Commitment Advance” means the aggregate dollar amount reflected in the closing settlement statement to be advanced
to or for the benefit of Borrower at the Closing, not to exceed the Commitment; provided, however, that Lender’s records
of the amount of the Initial Commitment Advance shall be conclusive evidence of the actual amount funded.

 

“Interest
Reserve” means a reserve of accrued interest in the aggregate amount of U.S. One Million Six Hundred Four Thousand
and No/100 Dollars ($1,604,000.00) that (subject to the provisions of Sections 5(b) and 5(c) of this Agreement),
may be used by Lender to accrue monthly interest and to defer the Accrued Interest Payment that would otherwise then be due and
payable by Borrower pursuant to Sections 5(b) and 5(c)(i) of this Agreement.

 

“Interest
Reserve Accrual” means an accrual of Interest Reserve by Lender on its books and records.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	5

    	 

    

 

“Lease”
has the meaning given to such term in Section 10(v).

 

“Lender”
means United Development Funding Income Fund V, a real estate investment trust organized under the laws of the State of Maryland,
and its successors and assigns.

 

“Lender
Conditions” means, collectively, Borrower’s and the Borrower-Related Parties’ strict compliance with
each of the requirements of the Closing Deliveries in Section 7 and each of the Advance Conditions in Section 8,
as determined by Lender in its sole discretion.

 

“Lender
Representatives” has the meaning given to such term in Section 10(m).

 

“Liabilities
and Costs” has the meaning given to such term in Section 14.

 

“Lien”
means any lien, security interest, charge, tax lien, pledge, encumbrance, collateral assignment, conditional sales or other title
retention arrangement or any other interest in property designed to secure the repayment of Indebtedness or the satisfaction of
any other obligation, whether arising by agreement or under any statute or law, or otherwise.

 

“Loan”
means the full amount of loan made to Borrower pursuant to this Agreement including all principal advanced and accrued interest
thereon and all other amounts owing to Lender under the Loan Documents.

 

“Loan
Documents” means, collectively, together with all exhibits and schedules thereto: this Agreement, the Note, the Deed
of Trust, the Environmental Indemnity Agreement, the Advance Requests, the Guaranty Agreements, the Financial Statement Certifications,
the Errors Agreement, the Post-Closing Agreement, the IRS tax disclosure forms, the Company Certificates, the Earnest Money Assignments
(if any), the Assignment and Subordination Agreements (if any), the Assignment of Contract Rights (if any), the Subordination Agreement,
and all other documents, instruments, agreements, assignments and certificates relating thereto, including, without limitation,
any and all loan or credit agreements, promissory notes, deeds of trust, mortgages, pledge agreements, financing statements, security
agreements, assignments of rents, assignments of leases, assignments of contracts, environmental indemnities, guaranties, contractor’s
consent agreements, lender’s title insurance policies, opinions of counsel, evidences of authorization or incumbency, escrow
instructions, and architect’s and/or engineer’s consent agreements, letters of credit, each of which is to be executed
(and acknowledged where applicable) by the Borrower, Guarantor and/or Lender (as and where applicable) in connection with Lender
making the Loan to Borrower, as the same may be amended, modified, or supplemented from time to time.

 

“Loan
Expenses” has the meaning given to such term in Section 2(a).

 

“Lot”
shall mean any platted lots, including Finished Lots, which are or may become a part of the Property.

 

“Lot
Purchaser” means (i) an Approved Builder or (ii) any other Person acquiring Lots from Borrower, subject to approval
by Lender in its sole discretion.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	6

    	 

    

 

“Lot
Sale Contract” means the Ryland Homes Lot Sale Contract and each other contract or agreement entered into by and
between Borrower and a Lot Purchaser relating to the acquisition from Borrower of Lots, as each may be amended, modified or supplemented
from time to time; provided however, that Lender’s consent to any Lot Sale Contract shall not be inferred from this reference.

 

“Management
Contracts” has the meaning given to such term in Section 11(a).

 

“Maturity Date”
means December 1, 2017.

 

“Mortgaged
Property” has the meaning given to such term in the Deed of Trust. The Mortgaged Property includes, without limitation,
all of the Property.

 

“Net
Proceeds” means (i) in the event of Lot(s) being sold under a Lot Sale Contract which has been approved by Lender
(including any amendments, modifications or supplements), the purchase price of the Lot stated in the Lot Sale Contract, less (x)
any Earnest Money credit that is required by the Lot Sale Contract to be deduced from the Purchase Price, and (y) any closing expense
paid by Borrower and shown on the settlement statement, which is required by the Lot Sale Contract to be paid by Borrower, or (ii)
in the event of any Disposition Lot(s) other than pursuant to a Lot Sale Contract approved by Lender (including any amendments,
modifications or supplements), such amount as is determined by Lender, in its sole discretion.

 

“Note”
means the Secured Promissory Note in the original principal amount of U.S. Ten Million Six Hundred Sixty Thousand and NO/100 Dollars
($10,660,000.00) payable to the order of Lender and its assigns, issued, executed and delivered by Borrower to Lender, as it may
be amended, modified or supplemented from time to time, in the form attached hereto as Exhibit “B” and
incorporated herein by this reference.

 

“Obligations”
means any and all of the covenants, conditions, warranties, representations and other obligations (other than to repay the Debt)
made or undertaken by Borrower or any Borrower-Related Party to Lender as set forth in the Loan Documents.

 

“Organizational
Agreement” shall mean (i) in respect of a corporation, the Articles of Incorporation certified to a current
date by the Secretary of State in which such corporation is incorporated and the Bylaws of a corporation certified to a current
date as true and correct by the secretary or assistant secretary of a corporation; (ii) in respect of a general partnership,
a partnership agreement; (iii) in respect of a joint venture, a joint venture agreement; (iv) in respect of a limited
partnership, a partnership agreement and the certificate of limited partnership certified to a current date by an appropriate Governmental
Authority of the state in which the limited partnership is organized; (v) in respect of a trust, a trust agreement; and (vi)
in respect of a limited liability company, the certificate of organization certified to a current date by the Secretary of State
in which such limited liability company is organized and the regulations of a limited liability company certified to a current
date as true and correct by the manager of a limited liability company; and any and all future modifications thereof which are
consented to by Lender.

 

“Other
Contracts” has the meaning assigned to such term in Section 11(b) hereof.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	7

    	 

    

 

“Owner
Loans” means, collectively, loans from owners of Borrower made in accordance with the terms of the Organizational
Agreement of Borrower, which are unsecured or subordinate both in payment and priority of Liens to the Loan and the Loan Documents
pursuant to a subordination agreement executed by such Person in favor of Lender.

 

“Partial
Release Amount” means, with respect to the Lots, the amount that must be paid to Lender for the release of Lender’s
Liens against a Lot, which amount must be equal to (i) in the event the Lot(s) being sold under a Lot Sale Contract which has been
approved by Lender (including any amendments, modifications or supplements), the amount of Net Proceeds relating to such Lot, or
(ii) in the event of any Disposition of Lots, in whole or in part, other than pursuant to a Lot Sale Contract approved by Lender
(including any amendments, modifications or supplements), such amount as is determined by Lender, in its sole discretion. Notwithstanding
anything to the contrary contained in the Loan Documents, (i) upon the occurrence and during the continuation of an Event of Default,
Lender has no obligation to release any part of the Collateral, and (ii) Lender’s consent to any Lot Sale Contract or any
amendment, modification or supplement thereto shall not be inferred from the foregoing references.

 

“Permitted
Exceptions” has the meaning given to such term in the Deed of Trust.

 

“Person”
means a corporation, limited liability company, general partnership, limited partnership, trust, or other entity, or any individual.

 

“Plans
and Specifications” means the plans and specifications for the construction of the Improvements prepared by the Engineer
and approved in writing by Borrower and Lender, as the same may have been or may be amended, modified or supplemented from time
to time.

 

“Post-Closing
Agreement” means that certain Post-Closing Agreement executed by Borrower, the Borrower-Related Parties, and Lender
dated as of the Effective Date.

 

“Principal
Officer” means Mehrdad Moayedi.

 

“Pro
Forma” means Borrower’s schedule for the sale of the Lots and the projected proceeds from the sale of the Lots,
prepared by Borrower in good faith and in accordance with industry standards, attached hereto as Exhibit “C”.

 

“Property”
means, collectively, that certain real property located in Collin County, Texas, which is more particularly described on Exhibit
“A” attached hereto and incorporated herein by reference.

 

“Re-Advance” has
the meaning given to such term in Section 4.

 

“Reimbursement
Contract” means any existing or future contract or agreement with the District or any city, county, water district,
municipal utility district, public improvement district, or other Governmental Authority providing for the sharing, payment and/or
reimbursement of the costs of planning, development and/or construction with respect to the Property such as, but not limited to,
a municipal utility district or public improvement district reimbursement agreement.

 

“Released
Party” has the meaning given to such term in Section 10(q).

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	8

    	 

    

 

“Ryland
Homes” means RH of Texas Limited Partnership, a Maryland Limited Partnership.

 

“Ryland
Homes Lot Sale Contract” means that certain Contract of Sale, dated May 1, 2014, by and between Borrower, as seller,
and Ryland Homes, as purchaser, for the purchase of 97 to-be-developed Lots, dated on or about the Effective Date.

 

“Ryland
Homes Indebtedness” means the Indebtedness of Borrower owed to the Ryland Homes in accordance with the Ryland Homes
Lot Sale Contract and the Subordination Agreement.

 

“Subordination
Agreement” shall mean that certain Subordination Agreement dated on or about the Effective Date, by and among Borrower,
Lender and the Ryland Homes, as amended, restated or supplemented from time to time, which among other things, subordinates the
Ryland Homes Indebtedness to the Lender, the Indebtedness, and Lender’s Lien.

 

“Substantial
Completion” means that each Lot (i) has been fully developed into a finished single-family residential Lot and is
suitable for the construction of a single family residence thereon, (ii) has been accepted by the city in which such Lot is located,
and each municipal district, municipality, water district, municipal utility district, public improvement district or other Governmental
Authority for the county in which the Lot is located, (iii) has all utility services necessary for the construction of single family
residence, including water supply, storm and sanitary sewer facilities, gas and electricity, and (iv) would require only a building
permit from the applicable Governmental Authority for a builder to construct a single family residence thereon.

 

“Title
Company” means Silver Star Title, LLC, d/b/a Sendera Title, as agent for Fidelity National Title Insurance Company.

 

“Title
Policy” shall mean one or more policies of mortgagee title insurance and all endorsements thereto requested by Lender,
issued in favor of Lender and naming Lender and its assigns as insured mortgagee by the Title Company and insuring that title to
the Property covered by the Deed of Trust is vested in Borrower, free and clear of any Lien, objection, exception or requirement
other than the Permitted Exceptions, and that Lender has a first priority Lien in the full amount of the Loan against the Property,
and containing such endorsements as Lender may require.

 

2.            Loan
Expenses; Fees.

 

(a)          To
the extent not prohibited by applicable law, Borrower will pay all reasonable costs and expenses and reimburse Lender for any and
all expenditures of every character incurred or expended from time to time, regardless of whether an Event of Default shall have
occurred, in connection with any of the following (collectively, “Loan Expenses”):

 

(i)          the
preparation, negotiation, documentation, closing, renewal, revision, modification, increase, administrating, monitoring, review
or restructuring of any loan or credit facility represented by or secured by the Loan Documents, including legal, accounting, auditing,
architectural, engineering, due diligence, title company, and inspection services and disbursements, or in connection with collecting
or attempting to enforce or collect pursuant to any Loan Document;

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	9

    	 

    

 

(ii)         Lender’s
evaluating, monitoring, administering and protecting the Collateral or employing others to do so or to perform due diligence for
Lender with respect thereto; and

 

(iii)        Lender’s
creating, perfecting and realizing upon Lender’s security interest in, and the Liens on the Collateral, and all costs and
expenses relating to Lender’s exercising any of its rights and remedies under any Loan Document or at law, including all
appraisal fees, consulting fees, filing fees, taxes, brokerage fees and commissions, title review and abstract fees, litigation
report fees, UCC search fees, other fees and expenses incident to title searches, reports and security interests, investigations,
escrow fees, attorneys’ fees, legal expenses, court costs, other fees and expenses incurred in connection with any complete
or partial liquidation of the Collateral, and all fees and expenses for any professional services or any operations conducted in
connection therewith. Notwithstanding the foregoing, no right or option granted by Borrower to Lender or otherwise arising pursuant
to any provision of any Loan Document shall be deemed to impose or admit a duty on Lender to supervise, monitor or control any
aspect of the character or condition of the Collateral or any operations conducted in connection with it for the benefit of Borrower
or any other Person other than Lender.

 

(b)          Usury
Savings Clause Applies. Borrower agrees that Lender has provided, and shall provide, separate and distinct consideration for
the fees and expenses described in the Loan Documents, and that such fees and expenses are necessary, bona fide fees and expenses
incurred in connection with the Loan. Borrower further agrees that such fees and expenses are not, are not intended to be, and
shall not be characterized as, interest or as compensation for the use, forbearance or detention of money. Despite the foregoing
and notwithstanding anything else in this Agreement and the other Loan Documents to the contrary, if any such fees or expenses
are determined to constitute interest and such fees or expenses, and when such fees and expenses are added to the interest charged
hereunder and any other items determined to constitute interest, it would cause the aggregate interest charged hereunder to exceed
the Highest Lawful Rate, then Section 13 of this Agreement shall automatically apply to reduce the interest charged hereunder
(taking into account all items determined to constitute interest) so as not to exceed the Highest Lawful Rate.

 

3.            Closing;
Commitment; Discretionary Advances.

 

(a)          Closing;
Commitment. Subject to the Lender Conditions, Lender agrees to fund the Initial Commitment Advance to Borrower at the Closing
and to fund the balance of the Commitment to the Borrower in accordance with the terms and conditions of this Agreement provided,
however, that all Advances shall be subject to, and made in accordance with, the terms and conditions of Section 3(b). Notwithstanding
anything else to the contrary contained herein, Lender shall have no obligation to make any Advance unless each of the Lender Conditions
has been satisfied.

 

(b)          Procedure
for Borrowing. Each Commitment Advance shall be made pursuant to Borrower’s delivery of an Advance Request to Lender,
accompanied by documentation supporting the Commitment Advance. Borrower agrees to provide all information, documents and agreements
as may be requested by Lender in connection with each such Advance Request. Notwithstanding anything else to the contrary contained
herein, Lender shall have no obligation to make any Advance unless each of the Lender Conditions is satisfied at the time of such
Advance.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	10

    	 

    

 

(c)          Discretionary
Advances. Lender is hereby authorized from time to time to make Advances without notice to Borrower that Lender, in its sole
discretion, deems necessary or desirable upon the occurrence of any of the following (such Advances made upon the occurrence of
the following events are referred to herein as the “Discretionary Advances”): (i) Lender determines,
in its sole discretion, that an Advance is be necessary or desirable for the purpose of paying any Loan Expense, cost, expense,
fee or other amount to or for the benefit of Borrower or chargeable to Borrower under the Loan Documents, (ii) any Event of Default
occurs, or (iii) upon request by Borrower for a Commitment Advance that would cause the aggregate amount of all Commitment Advances
made hereunder to exceed the Commitment. Each Discretionary Advance shall, upon disbursement, automatically constitute principal
outstanding hereunder and cause a corresponding increase in the aggregate amount of the Debt (even if such Discretionary Advance
causes the outstanding principal amount of the Note to exceed the Commitment or the face amount of the Note). Borrower agrees that
each Discretionary Advance may, in Lender’s discretion, reduce the amount of availability, if any, under the Commitment and
may, in Lender’s discretion, reduce the amount of available Interest Reserve, if any. The making by Lender of any Discretionary
Advance shall not cure or waive any Event of Default hereunder (except only for an Event of Default that has been cured to Lender’s
satisfaction as confirmed by Lender’s execution of a written agreement specifically acknowledging and describing the Event
of Default so cured, and for an Event of Default that has been waived by Lender as confirmed by Lender’s execution of a written
agreement specifically acknowledging and describing the Event of Default so waived).

 

4.            Revolving
Advances. In Lender’s sole and absolute discretion, Lender may re-advance the Commitment in whole or in part; provided,
that Lender is under no obligation to re-advance any part of the Commitment, and provided further, that if Lender decides to re-advance
any part of the Commitment, Lender shall have no obligation to fund such re-advance unless each of the Lender Conditions has been
satisfied (a re-advance made for the foregoing purposes are referred to herein as a “Re-Advance”). Each
Re-Advance made under the Note shall, upon disbursement, automatically constitute principal outstanding under the Note and shall
cause a corresponding increase in the aggregate outstanding principal amount of such Note and such Re-Advance shall not cause the
aggregate amount outstanding under the Note to exceed the face amount of such Note or causes the outstanding principal amount of
the Note to exceed the Commitment. Borrower agrees that each Re-Advance shall automatically reduce the amount of availability,
if any, under the Commitment. The making by Lender of any Re-Advance shall not cure or waive any Event of Default (except only
for an Event of Default that has been cured to Lender’s satisfaction as confirmed by Lender’s execution of a written
agreement specifically acknowledging and describing the Event of Default so cured, or for an Event of Default that has been waived
by Lender as confirmed by Lender’s execution of a written agreement specifically acknowledging and describing the Event of
Default so waived).

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	11

    	 

    

 

5.            Interest;
Payments.

 

(a)          Interest
Rate. The outstanding principal amount of the Note shall bear interest on each day outstanding at the Base Rate unless the
Default Rate shall apply. Upon the occurrence and during the continuation of an Event of Default, the outstanding principal amount
of the Note shall, at Lender’s option, automatically and without the necessity of notice, bear interest from the date of
such Event of Default at the Default Rate, until all such delinquent amounts are paid and such breach or Event of Default has been
cured to Lender’s satisfaction as confirmed by Lender’s execution of a written agreement specifically acknowledging
and describing the Event of Default so cured, and or waived by Lender as confirmed by Lender’s execution of a written agreement
specifically acknowledging and describing the Event of Default so waived.

 

(b)          Interest
Payments; Interest Reserve Accruals. Borrower agrees to make Accrued Interest Payments to Lender on the last day of each calendar
month while the Loan is outstanding, in an amount equal to the interest accrued on the outstanding principal balance of the Note
during each such calendar month. Notwithstanding the foregoing sentence, on each date that an Accrued Interest Payment becomes
due and payable, provided that the Lender Conditions are then satisfied and that a sufficient amount of Interest Reserve is available,
Lender shall make an Interest Reserve Accrual in the amount of such Accrued Interest Payment and such Accrued Interest Payment
that would otherwise be then due and payable will be deferred. Lender may, but is not obligated to, make Interest Reserve Accruals
hereunder whether or not the Lender Conditions have been met, provided, however, that if the Lender Conditions are not then met,
any such Interest Reserve Accruals shall be made at Lender’s option and in its sole discretion. Upon each Interest Reserve
Accrual, irrespective of whether the Lender Conditions were met, the amount of remaining Interest Reserve (if any) shall be reduced
by the amount of such Interest Reserve Accrual. Notwithstanding anything else to the contrary contained herein, (i) if at any time
an Event of Default has occurred and is continuing under this Agreement, Lender shall not be obligated to make any further Interest
Reserve Accruals, and thereafter, shall do so only in its sole discretion, unless and until the Event of Default has been cured
to Lender’s satisfaction as confirmed by Lender’s execution of a written agreement specifically acknowledging and describing
the Event of Default so cured, or waived by Lender as confirmed by Lender’s execution of a written agreement specifically
acknowledging and describing the Event of Default so waived, and (ii) in no event shall Lender be obligated to make any Interest
Reserve Accrual that would cause the aggregate amount of Interest Reserve Accruals made hereunder to exceed the remaining Interest
Reserve.

 

(c)          Interest
and Principal Payments. Except earlier upon any acceleration of the Note:

 

(i)          Borrower
promises to pay to Lender monthly Accrued Interest Payments on the last day of each calendar month for interest accrued during
such calendar month, unless Lender makes an Interest Reserve Accrual to defer such Accrued Interest Payment, as provided in Section
5(b) of this Agreement;

 

(ii)         in
addition to the payments required by the provisions of the clause above, concurrently with each Disposition of the Mortgaged Property
in whole or in part or any Lot thereof, Borrower promises to pay Lender, the full amount of such proceeds from such Disposition
for the portion of the Mortgaged Property or Lot so released from Lender’s Lien, which is due and payable prior to Lender
providing to Borrower (or releasing from escrow with the Title Company) its partial release of Lien on such portion of the Mortgaged
Property or Lot so released; and

 

(iii)        
in addition to the payments required by the provisions of the clauses above, Borrower promises to pay to Lender the outstanding
principal balance of the Note, together with all accrued, unpaid interest thereon, unpaid Loan Expenses and other unpaid amounts
due under the Loan Documents, on or prior to the Maturity Date.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	12

    	 

    

 

(d)          Collateral.
Notwithstanding anything to the contrary contained in the Loan Documents, upon the occurrence and during the continuation of an
Event of Default, Lender has no obligation to release any part of the Collateral.

 

6.            Terms
and Conditions of Payment.

 

(a)          Application
of Payments. All payments and prepayments on the Loan shall be applied first, to unpaid accrued interest calculated through
the date of such payment (irrespective of whether such unpaid accrued interest has been accrued on Lender’s books and records),
next, to principal outstanding under the Note). Notwithstanding the foregoing sentence, if any Event of Default occurs and is continuing,
Lender shall have the right to apply payments toward amounts due under this Agreement 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 Agreement,
or at such other address as from time to time may be designated by Lender. Borrower shall make each payment which it owes under
this Agreement 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 Agreement 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., Grapevine, 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 the Loan in whole or in part at any time and from time to time without incurring any prepayment fee or penalty,
by giving Lender no less than ten (10) days prior written notice of such termination; provided, that interest shall accrue on the
portion of the Note so prepaid through the date of such prepayment.

 

7.            Loan
Deliveries. At or prior to the Closing, 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 (the “Closing Deliveries”):

 

(a)          originals
duly executed and notarized, as appropriate, by Borrower and the Borrower-Related Parties of the Loan Documents including, without
limitation, this Agreement, the Deed of Trust, the Note, the Environmental Indemnity Agreement, the Advance Request, the Guaranty
Agreement, the Financial Statement Certifications, the Errors Agreement, the IRS tax disclosure forms, the Post-Closing Agreement,
and the Company Certificates;

 

(b)          the
Organizational Agreements of Borrower and each Borrower-Related Party that is an entity;

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	13

    	 

    

 

(c)          certificates
of existence and good standing for Borrower and each Borrower-Related Party that is an entity issued by the appropriate state authorities;

 

(d)          resolutions
of the general partner, manager or other governing body (as evidenced by the Organizational Agreements) of Borrower and each Borrower-Related
Party, authorizing the execution, delivery, and performance of this Agreement and the other Loan Documents, and the transactions
contemplated hereby and thereby;

 

(e)          copies
of the liability insurance and casualty insurance policies covering Borrower and the Property, evidence of payment of the premiums
therefor through at least one year and endorsements of such policies to Lender (in accordance with and meeting the requirements
of Sections 10(o) and (p) hereof);

 

(f)          all
written consents that are required with respect to or necessitated by this Agreement and the other Loan Documents and the transactions
contemplated hereby and thereby;

 

(g)          the
following due diligence and Closing documents and materials: (i) a current appraisal assessing the fair market value of the Property,
subject to Lender’s review and acceptance, completed by an appraiser acceptable to Lender, (ii) all environmental site assessments
and reports with respect to the Property, including, but not limited to, a wetlands assessment, (iii) all engineering reports and
studies, soil analysis, construction, structural and mechanical feasibility reports; all surveys, survey maps, plats and proposed
plats; all development plans, construction plans, and other plans and specifications; all topographic, drainage and contour maps
and all other reports, maps, studies and surveys of engineers, architects and others; (iv) certified copies of the deeds of conveyance
conveying the Property to Borrower, (v) the fully executed settlement statement prepared by the Title Company, which must be approved
by Lender prior to execution thereof, (vi) all sales and marketing plans for the Property, (vii) all contracts and agreements with
developers, engineers, contractors, subcontractors, consultants and others relating to supervision and maintenance of, and other
professional services relating to the Property, (viii) copies of all easements and encumbrances affecting the Property, including
land use, water use, mineral rights, surface rights, zoning, subdivision, grading, environmental restrictions, and neighborhood
association rights and restrictions and (ix) tax certificates for the Property covering taxes due for tax year(s) 2013 and earlier;

 

(h)          all
Lot Sale Contracts in existence on the Effective Date (or drafts thereof if unexecuted as of the Effective Date);

 

(i)          all
Reimbursement Contracts in existence on the Effective Date (or drafts thereof if unexecuted as of the Effective Date); and

 

(j)          such
other and further information, documents, agreements and certificates as are reasonably requested by Lender.

 

No waiver by Lender of the timely
delivery of any Closing Delivery will constitute a waiver of any condition precedent to any obligation of Lender to make any Advance
or to require delivery of any Closing Delivery prior to the funding of any Advance.

 

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Frisco 113, Collin County, Texas
	14

    	 

    

 

8.            Conditions
Precedent to Advances. Borrower agrees that, notwithstanding anything to the contrary contained herein or in the other Loan
Documents, Lender’s obligation to fund any Advance or to make any Interest Reserve Accrual shall be conditioned upon the
satisfaction by Borrower of each of the following conditions, on and as of the funding date for the Advance or the date of the
Interest Reserve Accrual, as applicable (the “Advance Conditions”):

 

(a)          no
event constituting an Event of Default shall have occurred and be continuing;

 

(b)          the
Principal Officer shall have executed and delivered to Lender an Advance Request dated the funding date, all matters certified
in the Advance Request shall be true and correct in all respects, and Lender shall have approved the Advance Request, as determined
by Lender in its sole discretion;

 

(c)          all
statements contained in all Loan Documents and all other certificates, statements and data furnished to Lender by or on behalf
of Borrower or in connection with the transactions contemplated by this Agreement or any of the other Loan Documents (including
all of the documents and information required to be delivered to Lender by Section 7) shall be true and complete in all
material respects, and there are no facts or events actually known to Borrower that, if disclosed to Lender, would make such statements,
certificates or date untrue in any material respect (and Borrower agrees to inform Lender, prior to Lender making any such Advance,
of any such facts or events actually known to Borrower);

 

(d)         all of the Loan
Documents shall be valid and subsisting, enforceable and in full force and effect and in the priority Lien position stated therein;

 

(e)          all
Loan Expenses owing shall have been paid in full;

 

(f)          the
Title Company shall have delivered to Lender the Title Company’s unconditional commitment to issue the Title Policy for the
Deed of Trust pursuant to a commitment that is satisfactory to Lender in all respects in the full Note amount, with all endorsements
thereto required by Lender, at Borrower’s expense;

 

(g)          the
Title Company shall have executed Lender’s Closing instruction and title objection letter and have complied with all conditions
therein;

 

(h)         the
amount of the requested Advance, when added to the outstanding principal amount of all Loan then outstanding, would not exceed
the Commitment;

 

(i)          the
amount of the Advance has been approved by Lender and the proceeds from such Advance shall be used for Approved Purposes; and

 

(h)         Borrower
shall have complied with each other reasonable request of Lender made in connection with the Advance.

 

No waiver given in connection with any
Advance will constitute a waiver of any condition precedent with respect to future Advances.

 

9.            Representations
and Warranties. Borrower and each Borrower-Related Party represents and warrants to Lender as follows:

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	15

    	 

    

 

(a)          Due
Organization, Existence and Authority. Borrower and each Borrower-Related Party that is an entity (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 as presently conducted and as proposed to be conducted, and to enter into and perform its
obligations under this Agreement and the other Loan Documents to which it is a party.

 

(b)          Loan
Documents Authorized. The execution and delivery by Borrower and each Borrower-Related Party of this Agreement and the other
Loan Documents and the full and timely performance of all obligations thereunder have been duly authorized by all necessary action
under the Organizational Agreement of Borrower and each Borrower-Related Party and otherwise.

 

(c)          Loan
Documents Valid, Binding and Enforceable. This Agreement and the other Loan Documents have been duly and validly executed,
issued and delivered by Borrower and each Borrower-Related Party, and constitutes the valid and legally binding obligations of
Borrower and each Borrower-Related Party enforceable in accordance with their respective terms, except as limited by bankruptcy,
insolvency, reorganization or other similar laws relating to or affecting enforcement of creditor’s rights.

 

(d)          No
Violation. The execution, delivery and performance by Borrower and each Borrower-Related Party of the Loan Documents does not
and will not (i) contravene the Organizational Agreement of Borrower and each Borrower-Related Party, (ii) contravene
any law, rule or regulation, or any order, writ, judgment, injunction or decree or any contractual restriction binding on or affecting
Borrower or any Borrower-Related Party or the Collateral, (iii) require any approval or consent of any general partner, board,
manager, member, lender or any other Person, other than approvals or consents that have been previously obtained and disclosed
in writing to the Lender, (iv) result in a breach of or constitute a default under any indenture or loan or credit agreement or
any other agreement, lease or instrument to which Borrower or any Borrower-Related Party is a party or by which Borrower or any
Borrower-Related Party or the Collateral may be bound or affected, or (v) result in, or require the creation or imposition of,
any Lien (other than the Liens contemplated by the Loan Documents) with respect to the Collateral.

 

(e)          No
Other Defaults; No Consents Required. To Borrower’s knowledge, neither Borrower nor any Borrower-Related Party are in
default with respect to any order, writ, injunction, decree or demand of any court or of any Governmental Authority which would
have a material adverse effect on Borrower or any Borrower-Related Party, as applicable, or which affects the Property in any materially
adverse manner. No authorization or approval or other action by, and no notice to or filing with, any Governmental Authority is
required for the due execution, delivery and performance by Borrower of the Loan Documents, other than approvals or consents that
have been previously obtained and disclosed in writing to the Lender.

 

(f)          Government
Regulations. Neither Borrower nor any Borrower-Related Party is subject to regulation under the Investment Company Act of 1940,
the Federal Power Act or the Public Utility Holding Company Act of 1935, the Interstate Commerce Act, as the same may be amended
from time to time, or any federal or state statute or regulation limiting its ability to incur Indebtedness

 

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Frisco 113, Collin County, Texas
	16

    	 

    

 

(g)          Securities
Activities Neither Borrower nor any Borrower-Related Party is engaged principally, or as one of its important activities, in
the business of extending credit for the purpose of purchasing or carrying any margin stock (as defined in Regulation U of
the Board of Governors of the Federal Reserve System in effect from time to time) and not more than twenty five (25%) of the value
of the assets of said entities consists of such margin stock.

 

(h)          Litigation
Matters. There are no actions, suits or proceedings pending, or to the knowledge of Borrower, threatened, against or affecting
Borrower, any Borrower-Related Party or the Collateral, or involving the validity or enforceability of the Loan Documents or the
priority of the Liens created or evidenced thereby, at law or in equity, or before or by any Governmental Authority.

 

(i)          Financial
Statements Complete and Accurate. All information supplied and statements made to Lender by or on behalf of Borrower or any
Borrower-Related Party is in any financial statement furnished or application for credit made prior to, contemporaneously with
or subsequent to the execution of this Agreement are and shall be true, correct, complete, valid and genuine; such financial statements
and applications for credit have been prepared in accordance with Good Accounting Practice and fully and accurately present the
financial condition of the subject thereof as of the date thereof and no material adverse change has occurred in the financial
condition reflected therein since the respective dates thereof; and no additional borrowings have been made by Borrower or any
Borrower-Related Party since the respective dates thereof other than (i) the borrowing contemplated hereby and (ii) other borrowings
approved by Lender’s prior written consent, which may be given or withheld in Lender’s sole discretion.

 

(j)          Environmental
Liability. To the knowledge of Borrower, no hazardous substances or solid wastes have been disposed of or otherwise released
on the Property in violation of Environmental Laws, nor is the Property including its soil, ground, water, air and other elements,
contaminated by hazardous substances or solid wastes in violation of Environmental Laws. The terms “hazardous substance”
and release” shall have the meanings specified in the Comprehensive Environmental Response Compensation and Liability Act
of 1980, as amended (42 U.S.C. Section 9601 et. seq.) (“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 (42 U.S.C. Section 6901 et. seq.) (“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.

 

(k)          Tax
Liabilities. Borrower has filed all tax returns required to be filed, or has obtained an extension which is currently valid
and in effect, for all federal, state, county, local, and foreign tax returns and reports required to be filed, including, without
limitation, taxes on the Collateral and all applicable income, payroll, personal property, real property, employee withholding,
social security, unemployment, franchise, excise, use and sales taxes. Borrower has paid in full all taxes that have become due
as reflected on all such returns and reports including any interest and penalties, expect for taxes being contested in good faith
and for which such taxpayer has set aside adequate reserves for the payment thereof. Borrower 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 the
knowledge of Borrower, threatened against Borrower or the Collateral.

 

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Frisco 113, Collin County, Texas
	17

    	 

    

 

(l)          Compliance
With Legal Requirements. Borrower and each Borrower-Related Party is in compliance with all legal requirements in respect of
the conduct of its business and the ownership of its assets. No violation of any legal requirement exists with respect to the Property;
the anticipated use of the Property complies with all applicable legal requirements; and all legal requirements applicable to the
Property have been satisfied. Borrower and each Borrower-Related Party owns or has the continuing right to use all permits, licenses,
patents, patent rights or licenses, trademarks, trademark rights, trade names, trade name rights and copyrights which are required
to conduct its business.

 

(m)          Full
Disclosure. All statements contained in any Loan Document shall constitute representations and warranties. None of the representations,
warranties, covenants, agreements or statements contained in any Loan Document or any schedule, exhibit, report, statement or certificate
furnished to Lender by or on behalf of Borrower or any Borrower-Related Party in connection with the Loan contains or will contain
any untrue statement of a material fact, or omits or will omit any material fact required to be stated therein or necessary to
make the statements made therein, in light of the circumstances under which they are made, not misleading.

 

(n)          No
Known Material Adverse Fact. Neither Borrower nor any Borrower-Related Party knows of any fact which materially and adversely
affects the Collateral, or the business, operations, prospects or condition, financial or otherwise, of Borrower.

 

(o)          Survival
of Representations and Warranties. All representations and warranties made by or on behalf of Borrower or any Borrower-Related
Party herein or in any other Loan Document shall survive the delivery of this Agreement and the making of the Loan and any investigation
at any time made by or on behalf of Lender shall not diminish its rights to rely thereon.

 

(p)          No
Usury. Without limiting the generality of any other representation or warranty set forth herein or in any other Loan Document,
the Loan is a commercial loan and not usurious under the laws of the State of Texas.

 

(q)          Advisement
by Lender. Prior to entering into this Agreement and the other Loan Documents, Borrower and each Borrower-Related Party has
been advised by Lender to seek the advice of an attorney and an accountant in connection with the Loan. Borrower and each Borrower-Related
Party have had the opportunity to seek the advice of an attorney and accountant of its choice in connection with the Loan.

 

(r)          Adequate
Consideration. Prior to entering into this Agreement and the other Loan Documents, Borrower and each Borrower-Related Party
has reviewed the benefits to be provided to it as a result of the Lender making the Loan and have concluded that (i) the Loan and
the terms and conditions of the Loan Documents are in the bests interests of Borrower and the Borrower-Related Parties, (ii) the
benefits of the Loan and the Loan Documents are reasonably equivalent in value to the Collateral to be pledged to secure the Loan
and the obligations assumed and to be assumed by them pursuant to the Loan Documents, and (ii) direct and indirect benefits will
flow to Borrower and the Borrower-Related Parties by virtue of Borrower and the Borrower-Related Parties providing guaranties and
Collateral to secure any present or future Indebtedness of Borrower or the Borrower-Related Parties to Lender.

 

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Frisco 113, Collin County, Texas
	18

    	 

    

 

(s)          No
Partnership, Joint Venture or Agency Intended. Nothing in this Agreement or the other Loan Documents is intended
or shall in any way be construed so as to create any form of partnership, joint venture or agency relationship between the
Borrower and each Borrower-Related Party, on the one hand, and the Lender on the other hand, the parties hereto having expressly
disclaimed any intention of any kind to create any partnership or agency relationship between them resulting from or arising out
of the Loan Documents.

 

(t)          Reimbursement
Contracts. On the Effective Date, there are no Reimbursement Contracts in effect between any District and Borrower.

 

(u)          Lot
Sale Contracts. Other than the Ryland Homes Lot Sale Contract, no Lot Sale Contract exists covering any of the Property on
the date of Closing.

 

(v)         Ownership.
Borrower owns the Property and owns all of the improvements thereon (other than any off-site improvements and any public utilities
and roadways), and all “materials” (as defined in Section 53.001 of the Texas Property Code) are free and clear of
all Liens except those in favor of Lender.

 

(w)         Zoning.
The use of the Property as residential real property complies with all applicable zoning ordinances, regulations and restrictive
covenants affecting the Property.

 

(x)          No
Work Performed. No labor or services have been performed by on behalf of Borrower or otherwise, and no materials have been
furnished or delivered by on or behalf of Borrower or otherwise to, the Property prior to the recording the Deed of Trust, which
could give rise to a Lien on the Property with priority equal to or greater than the Liens and security interests of the Deed of
Trust or other Loan Documents. No party has any right to claim a mechanics or materialmens lien, whether statutory or constitutional,
against the Property.

 

10.         Covenants.
Borrower and each Borrower-Related Party covenants and agrees as follows:

 

(a)          Payment;
Performance. Borrower shall promptly pay all amounts due and owing to Lender under this Agreement. Borrower and each Borrower-Related
Party shall timely perform and comply with each agreement and covenant made by them under this Agreement and the other Loan Documents.

 

(b)          Use
of Proceeds. Borrower shall use the proceeds of this Agreement solely for the acquisition of the Property, related closing
costs and expenses, and management of the Property, and other costs and expenses included in the Approved Budget. In no event shall
the proceeds of this Agreement be used, directly or indirectly, for personal, family, household or agricultural purposes or for
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)          Indebtedness.
Except for Owner Loans, Borrower shall not incur any Indebtedness or guaranty or provide security for any Indebtedness of another
Person or enter into any agreement to do so without the prior written consent of Lender, which may be which may be given or withheld
in Lender’s sole discretion. As a condition of Lender granting such consent, Lender may require Borrower and the other lender
to enter into a subordination agreement in favor of Lender, which shall be satisfactory to Lender in all respects. Notwithstanding
the foregoing, Borrower may incur trade debt to vendors, and suppliers and providers of services in the ordinary course of business
without violation of this Section 10(c).

 

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Frisco 113, Collin County, Texas
	19

    	 

    

 

(d)          Restriction
on Fundamental Changes. Without the prior written consent of Lender, which may be given or withheld in Lender’s sole
discretion, Borrower will not: (i) engage in any business activities or operations substantially different from or unrelated
to those in which it was engaged on the Effective Date, (ii) merge into or consolidate with any Person or dissolve, terminate,
liquidate or wind-up (or suffer any liquidation or dissolution) in whole or in part, or transfer or otherwise dispose of all its
assets or change its legal structure, (iii) acquire, by purchase or otherwise, all or substantially all of the business or
property of, or stock or partnership interest in, or other evidence of beneficial ownership of any Person, (iv) maintain its
assets in such a manner that it will be costly or difficult to segregate, ascertain or identify its individual assets from those
of any principal or Affiliate of Borrower or any other Person, (v) make any loans or advances to any third party, including any
principal or Affiliate of Borrower (vi) fail to maintain its records, books of account and bank accounts separate and apart from
those of the Affiliates of Borrower and any other Person or entity, (vii) change the management of Borrower from Mehrdad Moayedi,
or (viii) modify or amend the Organizational Agreements of Borrower or any Borrower-Related Party.

 

(e)          Notice
of Certain Events. Borrower shall promptly notify Lender in writing of (i) the occurrence of any event or series of events
causing, or that could be expected to cause or has caused, a material adverse effect on the operations or financial condition of
Borrower, any Borrower-Related Party or the Collateral, (ii) the occurrence of any Event of Default, (iii) any default by Borrower
or the acceleration of the maturity of any Indebtedness owed by Borrower or any Borrower-Related Party under any loan agreement,
indenture, mortgage, promissory note, contract or instrument to which Borrower or any Borrower-Related Party is a party or by which
any material asset or property of Borrower or any Borrower-Related Party is bound, (iv) any litigation instituted against Borrower
or the Collateral, or any claim made by any Person against or affecting the Collateral, (v) notices of violation received from
any Governmental Authority that may adversely affect the Collateral, (vi) any audits of any federal or state tax returns of Borrower
or any Borrower-Related party and the results of any such audit, (vii) any condemnation or similar proceedings with respect to
the Property, (viii) any Lien affecting the Property other than the Liens in favor of Lender and Permitted Exceptions, (ix) any
other matters which could reasonably be expected to adversely affect Borrower’s ability to perform its obligations under
this Agreement, and (x) any termination of, or any default under, or any receipt of notice of termination or default, under any
Lot Sale Contract or Reimbursement Contract. Borrower shall notify Lender in writing at least thirty (30) days prior to the date
that it or any Borrower-Related Party changes its or his name, address, principal place of business, or the place that it maintains
its or his books and records.

 

(f)          Financial
Statements; Tax Returns. Borrower shall deliver or cause to be delivered to Lender, the following:

 

(i)          within
sixty (60) days after the end of each fiscal quarter, the unaudited financial statements of Borrower, prepared in accordance with
Good Accounting Practice, and combined or consolidated as appropriate, including all notes related thereto;

 

(ii)         within
one hundred twenty (120) days after the end of each fiscal year, the unaudited financial statements of Borrower, prepared in accordance
with Good Accounting Practice, and combined or consolidated as appropriate, including all notes related thereto;

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	20

    	 

    

 

(iii)        copies
of all federal and state tax returns prepared with respect to Borrower within ten (10) days of such documents being filed with
the Internal Revenue Service or applicable state authority, along with an audit thereof upon request of Lender; and

 

(iv)        such
other information relating to the financial condition and affairs of Borrower, and the Collateral as Lender may from time to time
request.

 

All financial statements shall
be accompanied by duly executed Financial Statement Certifications.

 

(g)          Taxes.
Borrower shall pay or cause to be paid all federal, state and local taxes levied against it and its assets and the Collateral as
they become due and payable and before the same become delinquent. Borrower shall furnish to Lender evidence that all such taxes
are paid within ten (10) days following the date of payment. Notwithstanding the foregoing, Borrower 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) they
have notified Lender of the intent to contest such taxes, and (iii) adequate reserves for the liability associated with such tax
have been established in accordance with Good Accounting Practice.

 

(h)          Liens.
Borrower and each Borrower-Related Party shall not create, incur, assume, permit or suffer to exist any Lien on or against the
Collateral except liens created in favor of the Ryland Homes and Liens expressly permitted by the Loan Documents.

 

(i)          Operation
of Business; Licenses and Permits. Borrower and each Borrower-Related Party shall operate its business, manage and maintain
the Property in compliance with all applicable federal, state and local laws, rules, regulations, and ordinances. Borrower and
each Borrower-Related Party shall maintain or engage sufficient qualified personnel for the operations of its business. Borrower
and each Borrower-Related Party shall maintain its existence and good standing in each state where it operates or does any business,
except in any jurisdictions where the failure to maintain such existence and good standing would not have a material adverse effect
individually or in the aggregate, on its financial condition or operations. Borrower and each Borrower-Related Party shall obtain,
maintain and keep current, all consents, licenses, permits, authorizations, permissions and certificates which may be required
or imposed by any Governmental Authority or which are required by applicable federal, state or local laws, regulations and ordinances,
including, without limitation, those required to manage and maintain the Property.

 

(j)          No
Defaults. Borrower will not permit any “default” or “event of default” to occur under (i) the Ryland
Homes Indebtedness, or (ii) any other documents evidencing any Indebtedness if the same may have a material adverse effect on Borrower,
the Mortgaged Property, or Borrower’s ability to repay the Loan.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	21

    	 

    

 

(k)          Borrower
and Property Documents. In addition to the information otherwise required to be provided to Lender pursuant to the Loan Documents,
Borrower shall, within five (5) days following Lender’s request, furnish to Lender, the following documents:

 

(i)          all
documents, certificates, agreements, contracts and other materials required by or designated in the Advance Conditions, including,
without limitation, all amendments, modifications, and supplements thereto, and all new and additional documents, certificates,
and agreements, contracts and other materials relating thereto;

 

(ii)         all
capital expenditure and expense reports, invoices and documentation of expenses and capital expenditures, bank account information
and records, and other material financial and operational information related to the Collateral, including, without limitation,
an itemized breakdown of all costs and expenses, and all contracts evidencing such costs and expenses;

 

(iii)        minutes
of the meetings and all written consents of the general partner, managers, members, board or other governing authority of Borrower
relating in any respect to the Collateral including, without limitation, the Property;

 

(iv)        promissory
notes, loan documents, contracts and agreements evidencing Indebtedness of Borrower and the Borrower-Related Parties and all amendments,
modifications and supplements thereto;

 

(v)         any
new documents or information, and any updates, supplements, or replacements for any documents or information, required to be delivered
to Lender pursuant to the Loan Documents;

 

(vi)        all
Reimbursement Contracts and each amendment, modification and supplement thereto (provided, that by this reference, Lender shall
not be deemed to have approved any Reimbursement Contract or such amendment, modification or supplement);

 

(vii)       all
Lot Sale Contracts and each amendment, modification and supplement thereto (provided, that by this reference, Lender shall not
be deemed to have approved any such Lot Sale Contract or amendment, modification or supplement);

 

(viii)      other
contracts and agreements relating to the Property, its maintenance, development, construction, and management and each amendment,
modification and supplement thereto (provided, that by this reference, Lender shall not be deemed to have approved any such contract
or agreement, or amendment, modification or supplement); and

 

(ix)         all
other information with respect to Borrower, each Borrower-Related Party or the Collateral that Lender may reasonably request from
time to time.

 

(l)          Transactions
with Affiliates. Borrower shall not enter into or be a party to any agreement or transaction with any Affiliate except in the
ordinary course of and pursuant to the reasonable requirements of Borrower’s business and upon fair and reasonable terms
that are no less favorable to Borrower than it would obtain in a comparable arms-length transaction with a Person not an Affiliate
of Borrower, and on terms consistent with the business relationship of Borrower and such Affiliate prior to the Effective Date,
and fully disclosed to Lender.

 

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Frisco 113, Collin County, Texas
	22

    	 

    

 

(m)         Audit;
Inspections. Borrower and each Borrower-Related Party shall permit Lender and its employees, representatives, auditors, inspectors,
collateral verification agents, attorneys, accountants and agents (collectively, the “Lender Representatives”),
at any time and from time to time, at Borrower’s expense, to (i) audit all books and records related to Borrower, each
Borrower-Related Party and the Collateral, (ii) visit and inspect the offices of Borrower and each Borrower-Related party and to
inspect and make copies of all books and records, and to copy and record any information the Lender Representatives obtain, and
(iii) visit and inspect the Property. Borrower and each Borrower-Related Party agree to cooperate fully with Lender in connection
with such audits and inspections.

 

(n)          Agreements
related to the Property. Without the prior written consent of Lender, which may be given or withheld in Lender’s sole
discretion, neither Borrower nor any Borrower-Related Party shall enter into, amend, modify or terminate any agreement related
to the Collateral that reasonably would be expected to hinder, delay or impair the timely payment of the Debt or the performance
by Borrower or any Borrower-Related party of any obligations under the Loan Documents, or that could have a material adverse effect
on the value of the Collateral or Lender’s Liens against the Collateral.

 

(o)          General
Liability Insurance. Borrower shall at all times maintain or cause to be maintained general liability insurance with coverage
amounts that are normal and customary for similarly-situated entities engaged in similar businesses. Each such 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 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.

 

(p)          Notice
of Casualty. Borrower shall notify Lender promptly if any part of the Mortgaged Property suffers material damage or destruction,
and Lender may, without liability, refuse to make further advances until Borrower makes arrangements satisfactory to Lender for
restoration or replacement of the damaged or destroyed portion of the Mortgaged Property.

 

(q)          Communications.
Borrower and each Borrower-Related Party hereby consents to and agrees that Lender and its representatives, employees, project
managers, and consultants may communicate with (verbally and in writing, in person and via electronic communications), and exchange
information among and between, all contractors, subcontractors, engineers, design professionals and all others who have performed
or have contracted to provide work and/or services for the Mortgaged Property or any portion thereof, together with their respective
principals, employees and agents. Borrower and each Borrower-Related Party hereby releases and holds harmless, and agrees to indemnify,
Lender, its general partner and their respective partners, officers, directors, shareholders, representatives, employees, and agents
(each, a “Released Party”), from and against any and all damages, claims, liabilities and expenses related
to, associated with or in respect of any such communications or exchanges of information, whether or not they shall be caused
in whole or in part by the negligence of a Released Party, excluding Lender’s intentional misconduct or gross negligence.

 

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Frisco 113, Collin County, Texas
	23

    	 

    

 

(r)          Reimbursement
Contracts. Borrower shall obtain Lender’s written consent prior to entering into or permitting any Affiliate to enter
into any Reimbursement Contract, or prior to becoming an assignee of, or otherwise becoming entitled to receive proceeds under,
any such Reimbursement Contract. As a condition to giving its prior written consent, which may be given or withheld in Lender’s
sole discretion, Borrower agrees that Lender may require, in its sole discretion, that (i) the Reimbursement Contract and the proceeds
therefrom or related thereto be assigned to Lender pursuant to an Assignment of Contract Rights or other assignment form satisfactory
to Lender in form and substance and filed of record, and/or (ii) the proceeds therefrom or related thereto be paid to Lender, which
shall be applied by Lender to reduce Borrower’s obligations owed to Lender under this Agreement and the other Loan Documents,
until all such obligations have been paid in full. Notwithstanding anything else to the contrary contained herein or in any other
Loan Document, in no event shall any Reimbursement Contract require or result in a subordination of Lender’s Lien against
the Collateral. Borrower agrees to, and agrees to cause its Affiliates to, execute, enter into and deliver to Lender an Assignment
of Contract Rights or any additional agreements or assignments that Lender may request in order to facilitate the obligations of
Borrower under this Section. If despite an assignment to Lender, Borrower receives any reimbursement or other proceeds resulting
from a Reimbursement Contract, then Borrower agrees to immediately pay over to Lender the full amount of such proceeds, which shall
be applied by Lender to reduce Borrower’s obligations owed to Lender under this Agreement and the other Loan Documents, until
all such obligations have been paid in full. Borrower shall not amend, modify, or supplement any Reimbursement Contract or permit
or consent to any such amendment, modification or supplement without Lender’s prior written consent, which may be given or
withheld in Lender’s sole discretion.

 

(s)          Compliance
with Lot Sale Contracts. Borrower shall comply in all respects with its obligations under each Lot Sale Contract and shall
not take any action or inaction that creates a Borrower default under any such Lot Sale Contract. Borrower shall not terminate
any Lot Sale Contract except in accordance with its terms upon default thereunder by the Builder, in which case, Borrower shall
obtain the prior written consent of Lender, which may be given or withheld in Lender’ s sole discretion, to terminate such
Lot Sale Contract. Borrower shall obtain the prior written consent of Lender, which may be given or withheld in Lender’s
sole discretion, before entering into any agreement that amends, modifies or supplements any Lot Sale Contract. Lender shall not
unreasonably withhold or delay its consent to an amendment, modification or supplement of any Lot Sale Contract if Borrower shall
have consented to such amendment, modification or supplement; provided, however, that Lender may withhold its consent, as determined
by Lender in its sole discretion, to any amendment, modification or supplement to any Lot Sale Contract which (i) decreases the
purchase price payable for any Lots, (ii) delays the acquisition of any Lot beyond the schedule or date(s) agreed in such Lot Sale
Contract, (iii) could reasonably be expected to delay or impair the ability of Borrower to timely repay the Loan in accordance
with the terms and conditions or the Loan Documents, (iv) violates any of the Loan Documents, or (v) in Lender’s opinion,
materially and adversely affects Lender’s security for the Loan or the rights and benefits of Borrower under such Lot Sale
Contract.

 

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Frisco 113, Collin County, Texas
	24

    	 

    

 

(t)          Additional
Covenants for Lot Sale Contracts. Other than the Ryland Homes Lot Sale Contract, Borrower shall obtain Lender’s prior
written consent, which may be given or withheld in Lender’s sole discretion, before entering into any Lot Sale Contract.
Each Lot Purchaser must be either (i) an Approved Builder or (ii) another Person approved by Lender in its sole discretion.
For each Lot Sale Contract, the purchase price of the Lots, the timing of the take down schedule, if any, the other terms and conditions
of each Lot Sale Contract relating to the purchase price and timing of payment for the Lots must be satisfactory to Lender in its
sole discretion. Concurrently with entering into any Lot Sale Contract and as a condition to Lender approving any Lot Sale Contract,
Borrower shall execute and deliver to Lender, and shall cause the Lot Purchaser under the Lot Sale Contract, together with any
title company or other escrow agent holding earnest money (in the form of cash, a letter of credit or otherwise) to execute and
deliver to Lender, all of the following: (i) an Assignment of Lot Sale Contract, (ii) if required by Lender, a consent to the Assignment
of Lot Sale Contract executed by the Lot Purchaser, and (iii) and, in the event that Earnest Money is delivered or deposited in
support of the Lot Sale Contract, if required by Lender, an Earnest Money Assignment. Borrower further agrees to enter into such
amendments, modification or supplements to the Loan Documents in the form provided by Lender and to make such representations,
warranties, covenants, that Lender deems necessary or desirable in connection with each such Lot Sale Contract.

 

(u)          Certain
Approvals, Deliveries and Property Covenants.

 

(i)          Approved
Budget. The Approved Budget is attached hereto as Exhibit “F”. All Improvements to the Property shall be
constructed in accordance with the Approved Budget. Borrower shall not construct any Improvements on the Property, enter into
any Construction Contract, or order any supplies or materials, until Borrower as received notice that Lender has consented to
the Approved Budget. Borrower and the Borrower-Related Parties shall not make, consent to, approve, adopt or vote in favor of
any modification, amendment, supplement, or other change to the Approved Budget (except for changes in line items that do not
increase the overall budget amount) without Lender’s prior written consent, which may be given or withheld in Lender’s
sole discretion. Borrower and the Borrower-Related Parties shall construct the Improvements and manage the Property in strict
accordance with the Approved Budget.

 

(ii)         Pro
Forma. The Pro Forma is attached as Exhibit “C”. Borrower and the Borrower-Related Parties shall not make,
consent to, approve, adopt or vote in favor of any modification, amendment, supplement, or other change to the Pro Forma without
Lender’s prior written consent, which may be given or withheld in Lender’s sole discretion. Borrower shall cause aggregate
Lot sales to occur at least by the dates forth for Lot sales in the Pro Forma.

 

(iii)        Lot
Sales Report. Within ten (10) days after the end of each month, Borrower shall deliver to Lender, a sales report setting forth
the current sales status of all Lots, including pending and anticipated Lot sales, and naming the Approved Builder or other purchaser
thereof.

 

(iv)        Development
Plan. Borrower shall not construct any Improvements on the Property, enter into any Construction Contract, or order any supplies
or materials, until Borrower as received notice that Lender has consented to the Development Plan. Borrower and the Borrower-Related
Parties shall not make, consent to, approve, adopt or vote in favor of any modification, amendment, supplement, or other change
to the Development Plan without Lender’s prior written consent, which may be given or withheld in Lender’s sole discretion.
Borrower and the Borrower-Related Parties shall construct the Improvements and develop the Property in strict accordance with the
Development Plan and shall not permit any changes to the Property to occur, other than in accordance with the Development Plan.

 

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Frisco 113, Collin County, Texas
	25

    	 

    

 

(v)         Plans
and Specifications. Borrower shall not construct any Improvements on the Property, enter into any Construction Contract, or
order any supplies or materials, until Borrower as received notice that Lender has consented to the Plans and Specifications. Borrower
and the Borrower-Related Parties shall not make, consent to, approve, adopt or vote in favor of any modification, amendment, supplement,
or other change to the Plans and Specifications without Lender’s prior written consent, which may be given or withheld in
Lender’s sole discretion. Borrower and the Borrower-Related Parties shall construct the Improvements and develop the Property
in strict accordance with the Plans and Specifications.

 

(vi)        Limitation
on Transfer of Amenities. Borrower will not sell, lease, transfer or otherwise dispose of the existing or future common amenities,
except to the property owners association created for the benefit of the owners of the Lots and upon compliance with the applicable
provisions of the Deed of Trust.

 

(vii)       Lot
Sales. Borrower will not sell or lease, or offer to sell or lease, any portion of the Property unless such sale or lease transaction
is exempt from the requirements of the Interstate Land Sales Full Disclosure Act or Borrower complies with all of the provisions
thereof with respect to “Statements of Record” (as defined therein) and “Property Reports” (as defined
therein).

 

(viii)      Utilities.
Borrower shall secure utility services, including, without limitation, water and sewer taps for the Lots and shall not permit
any right to obtain utility services, including, without limitation, water and sewer taps, to expire.

 

(v)         Lease.
Borrower shall obtain Lender’s prior written consent, which may be given or withheld in Lender’s sole discretion, before
entering into any lease for the Property or any portion thereof (the “Lease”). Borrower further agrees
to amend, modify or supplement the Loan Documents to incorporate such representations, warranties, covenants, agreements and Events
of Default and other terms and conditions that Lender deems reasonably necessary in connection with such Lease.

 

(w)         Compliance
with Reimbursement Contracts. Borrower shall comply in all respects with its obligations under all Reimbursement Contracts
and shall not take any action or inaction that creates a default under the Reimbursement Contracts.

 

(x)          Sales
of Assets. Borrower will not sell, lease, transfer or otherwise dispose of the Collateral, except as permitted by the Loan
Documents.

 

(y)          Certain
Construction Matters.

 

(i)          The
Construction Contract. Borrower shall not become a party to any Construction Contract, or other contract for the performance
of any work on the Property or for the supplying of any labor, materials, or services for the development of any part of the Property
,except upon such terms and with such parties as shall be approved in advance in writing by Lender. Borrower shall cause each Contractor
to execute a Contractor’s Consent, satisfactory to Lender in form and substance, and shall contain a provision subordinating
the Contractor’s and all subcontractor's Liens to the Lien of the Deed of Trust. No approval by Lender of any Construction
Contract or change order shall impose upon Lender any responsibility for the adequacy, form, or content of such Construction Contract
or any change orders.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	26

    	 

    

 

(ii)         Affidavit
of Commencement. If requested by Lender, within thirty (30) days after the date of commencement of construction of the Improvements,
Borrower shall execute and record in the appropriate records of Collin County, Texas, an affidavit of commencement in proper form
and in accordance with Texas Property Code Section 53.124, setting forth the date work actually commenced on the Improvements.

 

(iii)        Availability
of Utilities. All utility services necessary for the occupancy and proper operation of the Improvements for their intended
purpose, will be obtained by Borrower and accounted for in the Development Plan and the Approved Budget, including water supply,
storm and sanitary sewer facilities, gas, electricity and telephone facilities, and Borrower will supply evidence thereof satisfactory
to Lender.

 

(iv)        Construction
of the Improvements. Once development of the Property has commenced, the construction of the Improvements shall be pursued
with due diligence and continuity, in a good and workmanlike manner, and in accordance with sound building and engineering practices,
all applicable governmental requirements, and the Development Plan. Borrower shall not permit cessation of work for a period in
excess of thirty (30) days during any period of time during which development on the Property is scheduled to be performed without
the prior written consent of Lender, which may be given or withheld in Lender’s sole discretion, except for delays due to
strikes, riots, acts of God, war, unavailability of labor or materials, governmental laws, regulations or restrictions and Borrower
shall promptly notify Lender of any such delays; provided, however, that in no event shall work cease for a period in excess of
sixty (60) days regardless of the cause. Borrower shall cause all materials supplied for, or intended to be utilized in, the development
of any part of the Property, but not affixed to or incorporated into the Property, to be stored on the Property or at such other
location as may be approved by Lender in writing, with adequate safeguards, as required by Lender, to prevent loss, theft, damage,
or commingling with other materials or projects.

 

(v)         Correction
of Defects. Unless approved in writing by Lender, Borrower shall correct or cause to be corrected (i) any material defect in
any part of the Improvements, (ii) any material departure in the development of any part of the Property from the Development Plan
and governmental requirements, or (iii) any encroachment by any structure located on the Property upon any building line, easement,
property line, or restricted area.

 

(z)          Consultants. Borrower
agrees that Lender may engage one or more consultants and whenever consent or approval by Lender is required under this Agreement,
the consent or approval may be conditioned upon consent or approval by such consultants. All reasonable costs of the consultants
shall be borne by Borrower. Borrower shall cooperate with the consultants and will use commercially reasonable efforts to cause
the design professionals, engineers, developers, contractors, project engineers and the employees of each of them to cooperate
with the consultants and, upon request, will furnish the consultants whatever they may consider reasonably necessary or useful
in connection with the performance of their duties. Borrower acknowledge and agree that the duties of the consultants run solely
to Lender and that the consultants shall have no obligations or responsibilities whatsoever to Borrower or to any other Person.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	27

    	 

    

 

11.         Assignments

 

(a)          Assignment
of Contracts. As additional security for the payment of the Debt and the payment and performance of the obligations,
covenants and agreements under the Loan Documents, Borrower and each Borrower-Related Party hereby transfers and assigns to Lender
for the benefit of Lender all rights and interest, but not its obligations, in, under and to all contracts, subcontracts and agreements,
written or oral, between Borrower and any other party, and between parties other than Borrower, in any way relating to (i) the
management, maintenance, administration, and marketing of the Property (collectively, the “Management Contracts”),
(ii) the development of the Mortgaged Property and/or the construction of Improvements on the Mortgaged Property, or the supplying
of material (specially fabricated or otherwise), labor, supplies, or other services therefor (collectively, the “Construction
Contracts”), and (iii) the Mortgaged Property in any other regard (the “Other Contracts”,
and collectively with the Management Contracts and the Construction Contracts, the “Contracts”) upon
the following terms and conditions:

 

(i)          Borrower
and each Borrower-Related Party represents and warrants to Lender that the copy of each Contract that Borrower has furnished or
will furnish to Lender is or will be a true and complete copy thereof, including all amendments thereto, if any, and that Borrower’s
interest therein is not subject to any claim, setoff or encumbrance;

 

(ii)         Neither
this assignment nor any action by Lender shall constitute an assumption by Lender of any obligations under any Contract, and Borrower
shall continue to be liable for all obligations of Borrower thereunder; and Borrower hereby agrees to perform all of its obligations
under each Contract. Borrower and each Borrower-Related Party hereby agrees to indemnify and hold Lender harmless against and from
any loss, cost, liability or expense (including, but not limited to, consultants’ fees and expenses and attorneys’
fees and expenses) incurred in connection with Borrower’s failure to perform any such Contract or any action taken by Lender,
except for matters arising as a result of the gross negligence or willful misconduct by Lender;

 

(iii)        Upon
the occurrence of an Event of Default, and during the continuance thereof, Lender shall have the right at any time (but shall have
no obligation) to take in its name or in the name of Borrower such action as Lender may at any time determine to be necessary or
advisable to cure any default under any Contract or to protect the rights of Borrower or Lender thereunder. Lender shall incur
no liability if any action so taken by it or on its behalf shall prove to be inadequate or invalid, and Borrower and each Borrower-Related
Party agrees to indemnify and hold Lender harmless against and from any loss, cost, liability or expense (including but not limited
to reasonable attorneys’ fees) incurred in connection with any such action, except for matters arising as a result of the
gross negligence or willful misconduct of Lender;

 

(iv)        Borrower
hereby irrevocably constitutes and appoints Lender as Borrower’s attorney-in-fact, in Borrower’s or Lender’s
name, to enforce all rights of such Borrower under each Contract; provided, however, that Lender agrees not to exercise such appointment
until the occurrence of an Event of Default, and during the continuance thereof. Such appointment is coupled with an interest and
is therefore irrevocable;

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	28

    	 

    

 

(v)         Prior
to the occurrence of an Event of Default, Borrower shall have the right to exercise its rights as owner under each Contract; provided,
that Borrower shall not cancel or amend any Contract or do or suffer to be done any act which would impair the security constituted
by this assignment without the prior written consent of Lender, which may be given or withheld in Lender’s sole discretion;
and

 

(vi)        This
assignment shall inure to the benefit of Lender and its successors and assigns, any purchaser upon foreclosure of the Liens against
any Property, any receiver in possession of any Property or any portion thereof and any entity affiliated with Lender which assumes
Lender’s rights and obligations under this Agreement.

 

(b)          Without
limitation, the foregoing indemnities contained in this Section 11 shall apply to Lender with respect to matters which in
whole or in part are caused by or arise out of, or are claimed to be caused by or arise out of, the negligence (whether sole, comparative
or contributory) or strict liability of Lender. However, such indemnities shall not apply to Lender to the extent that the subject
of the indemnification is caused by or arises out of the gross negligence or willful misconduct of Lender. 

 

12.         Default.

 

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

 

(i)          except
for Accrued Interest Payments due during any period when Accrued Interest Payments are made by Lender pursuant to Section 5(b),
the failure of Borrower to make any payment required by this Agreement in full on or before the date such payment is due (or declared
due pursuant to the terms of this Agreement), whether on or prior to the Maturity Date; or

 

(ii)         any
financial statement, representation, warranty, or certificate made or furnished by or with respect to Borrower or any Borrower-Related
Party contained in this Agreement or any other Loan Document or made in connection herewith or therewith, shall be materially false,
incorrect, or incomplete when made; or

 

(iii)        Borrower
or any Borrower-Related Party shall fail to perform or observe any covenant or agreement contained in this Agreement or any other
Loan Document that is not separately listed in this Section 12(a) as an Event of Default, and the same remains unremedied
for ten (10) days thereafter; or

 

(iv)        any
“event of default” or “default” occurs under any Loan Document other than this Agreement that is not separately
listed in this Section 12(a), and the same remains unremedied for ten (10) days thereafter; or

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	29

    	 

    

 

(v)         the
entry of a decree or order for relief by a court having jurisdiction in respect of Borrower or any Borrower-Related Party 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 or any Borrower-Related Party for any substantial
part of their respective properties or the Property, or ordering the winding up or liquidation of such person’s affairs;
or

 

(vi)        the
commencement by Borrower or any Borrower-Related Party 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 or any Borrower-Related Party for any substantial part of their respective properties or the Property, or
the making by Borrower or any Borrower-Related Party of any assignment for the benefit of creditors, or the admission by Borrower
or any Borrower-Related Party in writing of its 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 the assets of Borrower or any Borrower-Related Party or the Collateral in a proceeding brought
against or initiated by Borrower or any Borrower-Related Party or the Collateral; or

 

(viii)      if
Borrower or any Borrower-Related Party that is an entity is liquidated or dissolved or winds up their affairs, or the sale or liquidation
of all or substantially all of the assets of Borrower or any Borrower-Related Party that is an entity; or

 

(ix)         any
Disposition of any Collateral occurs (except as expressly permitted by the Loan Documents) without the prior written consent of
Lender, which may be given or withheld in Lender’s sole discretion; or

 

(x)          any
“default” or “event of default” not cured within the grace period, if any, for such default or event of
default (the terms “default” and “event of default” have the meaning given to such terms in the agreements
and documents described below), shall occur under (A) the documents evidencing the Ryland Homes Indebtedness, (B) any credit agreement,
loan agreement, promissory note or other document evidencing Indebtedness for borrowed money to which Borrower or any Borrower-Related
Party is a party as a borrower, debtor, guarantor or other obligor, or (C) any security agreement, pledge agreement, guaranty,
deed of trust, or other agreement providing guaranty of or security or collateral for Indebtedness, executed by Borrower or any
Borrower-Related Party, or

 

(xi)         the
death or disability of the Principal Officer; or

 

(xii)        any
Loan Document ceases to be valid and binding for any reason or Borrower or any Borrower-Related Party asserts so; or

 

(xiii)       Borrower
or any Borrower-Related Party suffers the entry against it of a final judgment for the payment of money in excess of $50,000 which
is not covered by insurance which is not paid in full within ten (10) days thereafter; or

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	30

    	 

    

 

(xiv)      Borrower
or any Borrower-Related Party or any of their Affiliates suffers a writ or warrant of attachment or any similar process to be issued
by any tribunal against all or any substantial part of its properties, assets or the Collateral including, without limitation,
the Earnest Money, or the Property, and such writ or warrant of attachment or any similar process is not stayed or released within
thirty (30) days after the entry or levy thereof or after any stay is vacated or set aside; or

 

(xv)       in
Lender’s opinion, the prospect for payment or the prospect for performance with respect to this Agreement or any other agreement
that Borrower or any Borrower-Related Party may have with Lender is impaired, including any impairment caused by a material adverse
change in the financial condition or business of Borrower or any Borrower-Related Party, and Lender so notifies Borrower in writing;
or

 

(xvi)      Borrower
or any Borrower-Related Party fails to comply with any covenant or agreement in any of Sections 10(b), (c), (d),
(h), (j), (m), (n), (r), (s), (t) (w) or (x) in any respect.

 

(b)          Upon
the occurrence of an Event of Default described in subsection (a)(v), (vi) or (vii) above, all obligations under
the Note, this Agreement 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 each
Borrower-Related Party and any and all sureties, guarantors and endorsers of the Note. 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 the Note together
with all accrued and unpaid interest on the unpaid principal balance, and Loan Expenses and other amounts due to Lender under this
Agreement 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 each Borrower-Related
Party any and all sureties, guarantors and endorsers of the Note, and/or (ii) exercise any or all of its rights under all
or any of the Loan Documents, and/or (iii) refuse to advance any funds hereunder, including, without limitation, any Interest Reserve,
and/or (iv) refuse to release any part of the Collateral for an amount less than the entire amount of the Debt, even if Lender
had previously agreed to do so, and/or (v) exercise any or all other rights and remedies available to Lender 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 Agreement 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
the Note is placed in the hands of an attorney for collection after an Event of Default or failure to pay under the Note, or if
all or any part of the Debt represented hereby is proved, established or collected in any court or in any bankruptcy, receivership,
debtor relief, probate or other court proceedings, Borrower and each Borrower-Related Party and all endorsers, sureties and guarantors
of the Note, jointly and severally, agree to pay reasonable attorneys' fees and collection costs to Lender in addition to the principal
and interest payable under the Note.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	31

    	 

    

 

13.         Usury
Laws. Notwithstanding anything to the contrary contained in this Agreement or any other Loan Document:

 

(a)          It
is expressly stipulated and agreed to be the intent of Borrower and each Borrower-Related Party and Lender at all times to comply
strictly with the applicable Texas law governing the maximum rate or amount of interest payable on the Debt, or applicable United
States federal law to the extent that such law permits Lender to contract for, charge, take, reserve or receive a greater amount
of interest than under Texas law. If the applicable law is ever judicially interpreted so as to render usurious any amount contracted
for, charged, taken, reserved or received in respect of the Debt, including by reason of the acceleration of the maturity or the
prepayment thereof, then it is the express intent of Borrower and each Borrower-Related Party and Lender that all amounts charged
in excess of the Highest Lawful Rate shall be automatically canceled, ab initio, and all amounts in excess of the Highest
Lawful Rate theretofore collected by Lender shall be credited on the principal balance of the Debt (or, if the Debt has been or
would thereby be paid in full, refunded to Borrower), and the provisions of the Note and the other Loan Documents shall immediately
be deemed reformed and the amounts thereafter collectible hereunder and thereunder reduced, without the necessity of the execution
of any new document, so as to comply with the applicable laws, but so as to permit the recovery of the fullest amount otherwise
called for hereunder and thereunder; provided, however, if the Note has been paid in full before the end of the stated term hereof,
then Borrower and each Borrower-Related Party and Lender agree that Lender shall, with reasonable promptness after Lender discovers
or is advised by Borrower that interest was received in an amount in excess of the Highest Lawful Rate, either credit such excess
interest against the Debt then owing by Borrower to Lender and/or refund such excess interest to Borrower. Borrower and each Borrower-Related
Party hereby agrees that as a condition precedent to any claim seeking usury penalties against Lender, Borrower will provide written
notice to Lender, advising Lender in reasonable detail of the nature and amount of the violation, and Lender shall have sixty (60)
days after receipt of such notice in which to correct such usury violation, if any, by either refunding such excess interest to
Borrower or crediting such excess interest against the Debt then owing by Borrower to Lender. All sums contracted for, charged,
taken, reserved or received by Lender for the use, forbearance or detention of the Debt shall, to the extent permitted by applicable
law, be amortized, prorated, allocated or spread, using the actuarial method, throughout the stated term of the Note (including
any and all renewal and extension periods) until payment in full so that the rate or amount of interest on account of the Debt
does not exceed the Highest Lawful Rate from time to time in effect and applicable to the Debt for so long as the Debt is outstanding.
In no event shall the provisions of Chapter 346 of the Texas Finance Code (which regulates certain revolving credit loan accounts
and revolving triparty accounts) apply to the Note or any other part of the Debt. Notwithstanding anything to the contrary contained
herein or in any of the other Loan Documents, it is not the intention of Lender to accelerate the maturity of any interest that
has not accrued at the time of such acceleration or to collect unearned interest at the time of such acceleration. The terms and
provisions of this paragraph shall control and supersede every other term, covenant or provision contained herein, in any of the
other Loan Documents or in any other document or instrument pertaining to the Debt.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	32

    	 

    

 

(b)          To
the extent that Lender is relying on Chapter 303 of the Texas Finance Code to determine the Highest Lawful Rate payable on the
Note or any other part of the Debt, Lender will utilize the weekly ceiling from time to time in effect as provided in such Chapter
303, as amended. To the extent United States federal law permits Lender to contract for, charge, take, receive or reserve a greater
amount of interest than under Texas law, Lender will rely on United States federal law instead of such Chapter 303 for the purpose
of determining the Highest Lawful Rate. Additionally, to the extent permitted by applicable law now or hereafter in effect, Lender
may, at its option and from time to time, utilize any other method of establishing the Highest Lawful Rate under such Chapter 303
or under other applicable law by giving notice, if required, to Borrower as provided by such applicable law now or hereafter in
effect.

 

14.         Indemnity;
Release. Borrower and each Borrower-Related Party 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 Agreement 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 the Property.

 

The foregoing indemnifications shall
apply whether or not such Liabilities and Costs are in any way or to any extent owned 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 each Borrower-Related Party) 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
Agreement but also to each partner, director, officer, attorney, employee, representative and Affiliate of such Person.

 

For good and valuable consideration
set forth herein, including the promises, agreements, covenants, representations and obligations set forth in this Agreement and
the other Loan Documents, Borrower and each Borrower-Related Party hereby releases and forever discharges, and covenants not to
sue or file any charges or claims against Lender for any and all existing or future claims, demands and causes of action, in contract
or in tort, at law or in equity, known or unknown, pending or threatened, for all existing and future damages arising out of or
in any way associated with this Agreement and the other Loan Documents and the Loan made pursuant hereto and thereto.

 

15.         No
Presumption. Borrower and each Borrower-Related Party represents and warrants to Lender that they have read and fully understand
the terms and provisions hereof, have had an opportunity to review this Agreement and the other Loan Documents with legal counsel
and have executed this Agreement and the other Loan Documents based on their own judgment. If an ambiguity or question of intent
or interpretation arises, the Loan Documents will be construed as if drafted jointly by Borrower and each Borrower-Related Party
and Lender and no presumption or burden of proof will arise favoring or disfavoring any party because of authorship of any provision
of the Loan Documents.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	33

    	 

    

 

16.         Set-Off.
Borrower hereby gives and confirms to Lender a right of set-off of all moneys, securities and other property of Borrower (whether
special, general or limited) and the proceeds thereof, now or hereafter delivered to remain with or in transit in any manner to
Lender, its correspondents or its agents from or for Borrower, whether for safekeeping, custody, pledge, transmission, collection
or otherwise or coming into possession of Lender in any way, and also, of all other liabilities and obligations now or hereafter
owed by Borrower to Lender, contracted with or acquired by Lender, whether joint, several, absolute, contingent, secured, unsecured,
matured or unmatured, hereby authorizing Lender at any time after an Event of Default has occurred and is continuing, without prior
notice, to apply such balances, credits of claims or any part thereof, to such liabilities in such amounts as it may select, whether
contingent, unmatured or otherwise, and whether any collateral security therefor is deemed adequate or not. The rights described
herein shall be in addition to any collateral security described in any separate agreement executed by Borrower.

 

17.       No Third Party Beneficiaries.
The benefits of this Agreement and the Loan Documents will not inure to any third party. Notwithstanding anything contained in
the Loan Documents or any conduct or course of conduct by Borrower or any Borrower-Related Party or Lender, before or after the
date of this Agreement, this Agreement will not be construed as creating any rights, claims, or causes of action against Lender,
or any of its officers, directors, agents or employees, in favor of any contractor, subcontractor, supplier of labor or materials,
or any of their respective creditors, or any other person or entity other than Borrower. Without limiting the generality of the
foregoing, Advances made to any Person other than Borrower (including, without limitation, any contractor, subcontractor or supplier
of labor or materials) will not be deemed recognition by Lender of any third-party beneficiary status claimed by any such person
or entity.

 

18.         Cumulative
Remedies. All rights and remedies that Lender is afforded by reason of the Loan Documents are separate and cumulative with
respect to Borrower 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.

 

19.         Notice.
Any notice, request or other communication required or permitted to be given hereunder shall be given in writing by any of the
following methods: (i) registered or certified mail, (ii) facsimile, (iii) delivered personally by courier service, or (iv)
delivered by nationally recognized overnight delivery service; in each case, addressed to the respective parties as follows:

 

	If to Borrower:	CTMGT Frisco 113, LLC
	 	1800 Valley View Lane, Suite 300
	 	Farmers Branch, Texas 75234
	 	Facsimile No. (469) 892-7201
	 	Attention:  Mehrdad Moayedi
	 	 
	If to a	 
	Borrower-Related Party:	Mehrdad Moayedi
	 	CTMGT, LLC
	 	Centamtar Terras, L.L.C.
	 	1800 Valley View Lane, Suite 300
	 	Farmers Branch, Texas 75234
	 	Facsimile No. (469) 892-7201
	 	Attention:  Mehrdad Moayedi

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	34

    	 

    

 

	If to Lender:	United Development Funding Income Fund V
	 	1301 Municipal Way, Suite 200
	 	Grapevine, Texas 76051
	 	Facsimile No. (817) 835-0383
		Attention:  c/o UMTH Land Development
	 	Ben Wissink and Melissa Youngblood
	 	 
	With a Copy to:	 
	(which shall not constitute notice to)
	 	 
	 	Michael Franklin
	 	Hallett & Perrin, P.C.
	 	1445 Ross Avenue, Suite 2400
	 	Dallas, Texas 75202
	 	Facsimile No. (214) 922-4142

 

Each notice or other communication will
be treated as effective and as having been given and received (i) if sent by certified mail, or registered mail, three (3)
Business Days after deposit in a regularly maintained receptacle for deposit of United States mail, (ii) if sent by facsimile,
upon written or electronic confirmation of facsimile transfer, (iii) if delivered by courier, upon written or electronic confirmation
of delivery from such service, or (iv) if sent by nationally-recognized overnight delivery service, upon written or electronic
confirmation of delivery from such service. Borrower’s or any Borrower Related party’s address for notice may be changed
at any time and from time to time, but only after thirty (30) days’ advance written notice to Lender and shall be the most
recent such address furnished in writing by them to Lender. Lender’s address for notice may be changed at any time and from
time to time, but only after written notice to Borrower and shall be the most recent such address furnished in writing by Lender
to Borrower. Actual notice, however and from whomever given or received, shall always be effective when received.

 

20.         Enforcement
and Waiver by Lender. Lender shall have the right at all times to enforce the provisions of this Agreement 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.

 

21.         Choice
of Law. 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 Agreement 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 conflict
of laws provisions.

 

22.         Jurisdiction;
Venue. Borrower irrevocably agrees that any legal proceeding in respect of this Agreement and the other Loan Documents shall
be brought in the district courts of Tarrant County, Texas or the United States District Court for the Northern District of Texas,
Fort Worth Division (the “Specified Courts”). Borrower hereby irrevocably submits to the nonexclusive jurisdiction
of the Specified Courts. Borrower hereby irrevocably waives, to the fullest extent permitted by law, any objection that it may
now or hereafter have that the laying of venue of any suit, action or proceeding brought in any such Specified Court has been brought
in an inconvenient forum. Borrower hereby irrevocably agrees to a transfer of all such proceedings to the Specified Courts. Nothing
herein shall affect the right of Lender to commence legal proceedings or otherwise proceed against Borrower in any jurisdiction
or to serve process in any manner permitted by applicable law. 

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	35

    	 

    

 

23.         Counterparts.
This Agreement 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.

 

24.         Severability.
If any provision of this Agreement or any other Loan Document 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.

 

25.         Amendments;
Waivers. No amendment or waiver of any provision of this Agreement 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 party, and then such waiver or consent shall
be effective only in the specific instance and for the specific purpose for which given.

 

26.         Binding
Effect; Assignment. This Agreement and the other Loan Documents shall be binding on Borrower and its successors and assigns,
including, without limitation, any receiver, trustee or debtor in possession of or for Borrower, and shall inure to the benefit
of Lender and its successors and assigns. Borrower shall not be entitled to transfer or assign their obligations under this Agreement
and the other Loan Documents in whole or in part without the prior written consent of Lender, which may be given or withheld in
Lender’s sole discretion. This Agreement and the other Loan Documents are freely assignable and transferable by Lender without
the consent of Borrower. Should the status, composition, structure or name of Borrower 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.

 

27.         Time
of the Essence. Time is of the essence in this Agreement and the Loan Documents.

 

28.         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.

 

29.         Further
Assurances; Cooperation. Borrower and each Borrower-Related Party will at any time and from time to time upon request of the
Lender take or cause to be taken any action, will execute, acknowledge, deliver or record any further documents, opinions, mortgages,
security agreements, financing statements, amendments to the Loan Documents or other instruments as Lender in its reasonable discretion
deems necessary or appropriate to carry out the purposes of the Loan Documents and to preserve, protect and perfect the security
interest intended to be created and preserved in the Collateral.

 

30.         Joint
and Several Liability. “Borrower” shall mean each co-borrower hereunder, or any of them, if more than one. The
obligations of said Borrower hereunder if more than one, shall be joint and several. Suit may be brought against said Borrower,
jointly and severally, and against any one or more of them, or less than all, without impairing the rights of Lender against the
others of said Borrower; and Lender may compromise with any one of said Borrower for such sums or sum as it may see fit and release
such of said Borrower from all further liability to Lender for such Indebtedness without impairing the right of Lender to demand
and collect the balance of such Indebtedness from others of said Borrower not so released.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	36

    	 

    

 

31.         Lender
Consent. Where any provision of this Loan Agreement or any other Loan Document requires Lender’s consent, or requires
Borrower to obtain Lender’s consent, in each such case, Lender’s consent shall not be inferred from any action or inaction
of Lender, but instead must be evidenced by a written agreement or consent executed by Lender.

 

32.         Waiver
of Jury Trial, Punitive Damages, etc. Borrower and each Borrower-Related Party hereby knowingly, voluntarily, intentionally
and irrevocably (a) waives, to the maximum extent not prohibited by law, any right Borrower and each Borrower-Related Party 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 Agreement or the Loan Documents or any transaction contemplated hereby or thereby or associated herewith
or therewith, (b) waives, to the maximum extent not prohibited by law, any right Borrower and each Borrower-Related Party 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 make the Loan to Borrower and to enter into the Loan Documents with Borrower and each Borrower-Related Party by, among other
things, the waivers and certifications contained in this Section. As used in this Section, the term “Special Damages”
means and includes special, consequential, exemplary or punitive damages (regardless of how named).

 

33.         Entire
Agreement. This Agreement 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
Agreement and the other Loan Documents. There are no unwritten oral agreements among the parties and this Agreement and the other
Loan Documents may not be contradicted by evidence of prior, contemporaneous or subsequent oral agreements of the parties. 

 

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

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	37

    	 

    

 

This Agreement has
been executed on this the 24th day of November, 2014 by the undersigned Borrower, to be effective for all purposes as
of the Effective Date.

 

	BORROWER: 
	 
	CTMGT FRISCO 113, LLC, 
	a Texas limited liability company
	 	 	 
	By: 	Centamtar Terras, L.L.C.
	Its:  	Sole Manager
	 	 	 
	 	By:	CTMGT, LLC
	 	Its:	Sole Member and Manager 
	 	 	 
	 	/s/ Mehrdad Moayedi	 
	 	Mehrdad Moayedi
	 	Sole Member and Manager
	 	 	 	 

    	Loan Agreement
Frisco 113, Collin County, Texas
	38

    	 

    

 

This Agreement has
been executed on this the 24th day of November, 2014 by the undersigned Borrower-Related Parties, to be effective for
all purposes as of the Effective Date.

 

	BORROWER-RELATED PARTIES: 	 	 
	 	 	 
	/s/ Mehrdad Moayedi	 	 
	MEHRDAD MOAYEDI	 	 
	 	 	 
	CTMGT, LLC, a Texas limited liability company	 	 
	 	 	 
	/s/ Mehrdad Moayedi	 	 
	Mehrdad Moayedi	 	 
	Sole Member and Manager of CTMGT, LLC

 

	CENTAMTAR TERRAS, L.L.C., a Texas limited liability company
	 	 	 
	By:	CTMGT, LLC
	Its:	Sole Member and Manager of Centamtar Terras, L.L.C.
	 	 	 
	 	/s/ Mehrdad Moayedi	 
	 	Mehrdad Moayedi	 
	 	Sole Member and Manager of CTMGT, LLC

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	39

    	 

    

 

This Agreement has
been executed on this the 24th day of November, 2014 by the undersigned Lender, to be effective for all purposes as
of the Effective Date.

 

	LENDER:
	 
	UNITED DEVELOPMENT FUNDING INCOME FUND V,
	a real estate investment trust organized under the laws of the State of Maryland
	 
	/s/ David A. Hanson	 
	David. A. Hanson
	Chief Operating Officer and Chief Accounting Officer

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	40

    	 

    

 

EXHIBIT A

 

PROPERTY

 

TRACT 1:

 

Description of a 107.406 acre tract of
land situated in the Benjamin J. Naugle Survey, Abstract No. 663, and being a portion of that 113.0627 acre tract conveyed to 113
Preston Partners, Ltd. by deed recorded in Volume 5790, Page 4759, Deed Records, Collin County, Texas; said 107.406 acre tract
being more particularly described as follows;

 

BEGINNING, at a 5/8-inch iron rod with
"GSES, INC., RPLS 4804" cap found at the northeast corner of said 113.001 acre tract; said point being the northeast
corner of the Benjamin J. Naugle Survey, Abstract No. 663 and the northwest corner of the Collin County School Land Survey, Abstract
No. 155; said point being on the south line of the Thomas J. Jamison Survey, Abstract No. 481; said point being on the south line
of a called 88.9310 acre tract of land conveyed to Preston 380/153 Venture by deed recorded in County Clerk's File No. 98-0005379,
Deed Records, Collin County, Texas; said point also being the northwest corner of a called 292.00 acre tract of land conveyed to
Rock Hill Enterprises, Ltd. by deed recorded in County Clerk's File No. 07-0135950, Deed Records, Collin County, Texas;

 

THENCE, South 00 degrees 07 minutes 33
seconds East, with the common line between said Naugle and Collin County School Land Surveys and the common line between said 113.001
acre tract and Rock Hill Enterprises, Ltd. tract, a distance of 2702.97 feet to a 1-inch iron rod found for the southeast corner
of said 113.001 acre tract in the center of Rock Hill Road (County Road No. 25); said point being the southeast corner of said
Naugle Survey and the northeast corner of the P. W. Renison Survey, Abstract No. 756; said point being also the southwest corner
of said Rock Hill Enterprises, Ltd. tract and the northeast corner of a called 154.331 acre tract of land conveyed to Cothran Malibu
Inv., Inc. in deed recorded in Volume 3434, Page 863 Deed Records, Collin County, Texas and the northwest corner of a called 80.00
acre tract of land conveyed to M. K. Rock Hill Enterprises, Ltd., Jr. by deed recorded in Volume 785, Page 409, Deed Records, Collin
County, Texas;

 

THENCE, North 89 degrees 22 minutes 14
seconds West, with the common line of between said Naugle and Renison Surveys and the common line between said 113.001 acre tract
and Cothran Malibu Inv., Inc tract, a distance of 1245.90 feet to a PK nail with shiner found (a found 1-inch iron rod bears North
00 degrees 31 minutes 35 seconds East 30.00 feet) for the southern most southwest corner of said 113.001 acre tract in the centerline
of said Rock Hill Road; said point being also the southeast corner of a called 1.9441 acre tract of land conveyed to Rock Hill
Church of Christ of Frisco by deed recorded in Volume 5323, Page 5786, Deed Records, Collin County, Texas;

 

THENCE, North 00 degrees 31 minutes 35
seconds East, leaving the centerline of said Rock Hill Road and with the common line between said 113.001 acre tract and Rock Hill
Church of Christ tract, a distance of 340.31 feet to a 1/2-inch iron rod found for an interior corner of said 113.001 acre tract
and the northeast corner of said Rock Hill Church of Christ tract;

 

THENCE, North 89 degrees 47 minutes 05
seconds West, with the south line of said 113.001 acre tract, at a distance of 249.47 feet pass a 1-inch iron pipe found 1.02 feet
to the south for the northwest corner of said Rock Hill Church of Christ tract and the northeast corner of a called 5.45 acre tract
conveyed to Steven A. Kaufman, et al by deed recorded in County Clerk's File No. 97-0110680, Deed Records, Collin County, Texas;
continuing, with the south line of said 113.001 acre tract, in all, a distance of 513.64 feet to a 1/2-inch iron rod found for
a southwest corner of said 113.001 acre tract; said point being also the southeast corner of a called 6.8427 acre tract of land
conveyed to Bobby Jack Cross, and wife, Catherine Ann Cross by deed recorded in Volume 1091, Page 268, Deed Records, Collin County,
Texas;

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	41

    	 

    

 

THENCE, with the common line between said
113.001 acre tract and Cross tract, the following metes and bounds:

 

North 00 degrees 03 minutes 35 seconds
West, a distance of 324.11 feet to a 1/2-inch iron rod found for corner;

 

North 88 degrees 59 minutes 35 seconds
West, a distance of 116.48 feet to a 1/2-inch iron rod found for corner;

 

North 02 degrees 02 minutes 15 seconds
East, a distance of 17.57 feet to a 1/2-inch iron rod found for an interior corner of said 113.001 acre tract and the most northerly
northeast corner of said Cross tract;

 

THENCE, North 00 degrees 41 minutes 52
seconds East, a distance of 329.85 feet to a 1/2-inch iron rod found for an interior corner of said 113.001 acre tract; said point
being also the southeast corner of a called 4.98 acre tract of land conveyed to Edwina L. Cannaday by deed recorded in County Clerk's
File No. 01-0165964, Deed Records, Collin County, Texas;

 

THENCE, North 01 degrees 01 minutes 17
seconds East, with the common line between said 113.001 acre tract and Cannaday tract, at a distance of 347.48 feet pass the northeast
corner of said Cannaday tract and the southeast corner of The Stages Addition, an addition to Collin County, Texas recorded in
Cabinet G, Page 633, Plat Records, Collin County, Texas; continuing in all a distance of 468.44 feet to a 1/2-inch iron rod found
at an interior corner of said 113.001 acre tract and an interior corner of said The Stages Addition;

 

THENCE, North 82 degrees 02 minutes 31
seconds East, with the common line between said 113.001 acre tract and The Stages Addition, a distance of 41.08 feet to a 1/2-inch
iron rod found for an interior corner of said 113.001 acre tract and the northern most southeast corner of The Stages Addition;

 

THENCE, North 04 degrees 07 minutes 56
seconds East, with the common line between said 113.001 acre tract and The Stages Addition, a distance of 99.01 feet to a 1/2-inch
iron rod found for the northeast corner of The Stages Addition, said point being also the southeast corner of a called 4.48 acre
tract conveyed to Dorothy Keeran by deed recorded in Volume 4486, Page 2884, Deed Records, Collin County, Texas;

 

THENCE, North 03 degrees 25 minutes 06
seconds East, with the common line between said 113.001 acre tract and Keeran tract, at a distance of 347.68 feet pass the northeast
corner of said Keeran tract and the southeast corner of a called 7.293 acre tract conveyed to HFLP Real Estate, Ltd. by deed recorded
in County Clerk's File No. 06-1493040, Deed Records, Collin County, Texas; continuing, with the common line between said 113.001
acre tract and HFLP Real Estate, Ltd. tract, at an additional distance of 382.28 feet pass the northeast corner of said HFLP Real
Estate, Ltd. tract and the southeast corner of a called 7.469 acre tract conveyed to HFLP Real Estate, Ltd. by deed recorded in
County Clerk's File No. 06-1493040, Deed Records, Collin County, Texas; continuing, with the common line between said 113.001 acre
tract and HFLP Real Estate, Ltd. tract, in all, a distance of 1111.11 feet to a 5/8-inch iron rod with "GSES, INC., RPLS 4804"
cap found for the northwest corner of said 113.001 acre tract and the northeast corner said HFLP Real Estate, Ltd. tract; said
point being on the south line of said Preston 380/153 Venture tract; said point being also on the common line between said Naugle
and Jamison Surveys;

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	42

    	 

    

 

THENCE, South 89 degrees 43 minutes 20
seconds East, with the common line between said Naugle and Jamison Surveys and the common line between said 113.001 acre tract
and Preston 380/153 Venture tract, a distance of 1740.16 feet to the POINT OF BEGINNING;

 

CONTAINING, 4,678,621 square feet or 107.406
acres of land, more or less.

 

SAVE AND EXCEPT:

 

Description of a 23.210 acre tract of land
situated in the Benjamin J. Naugle Survey, Abstract No. 663, in the City of Frisco, Collin County, Texas; said tract being all
of Lot 2, Block A of the Rockhill at Preston Addition, an addition to the City of Frisco, Collin County, Texas according to the
Conveyance Plat thereof recorded in County Clerk's File No. 2012-262, Deed Records, Collin County, Texas; said tract being a portion
of that 107.406 acre tract conveyed to CTMGT FRISCO 113, by Special Warranty Deed recorded in County Clerk's File No. 20120802000947470,
Deed Records, Collin County, Texas; said 23.210 acre tract being more particularly described as follows;

 

COMMENCING, at a TXDOT monument in concrete
found for the northeast corner of a 0.0478 acre tract of land conveyed to the State of Texas for the right-of-way of State Highway
289 (Preston Road, variable width public right-of-way) according to the deed recorded in County Clerk's File No. 20070131000139470,
Deed Records, Collin County, Texas; said point being also on the south line of a called 4.98 acre tract of land conveyed to Edwina
L. Cannaday by deed recorded in County Clerk's File No. 01-0165964, Deed Records, Collin County, Texas;

 

THENCE, South 89 degrees 27 minutes 31
seconds East, with the south line of said Cannaday tract, a distance of 739.70 feet to a 1/2-inch iron rod found for the southeast
corner of said Cannaday tract and the southwest corner of said Lot 2; said point being the POINT OF BEGINNING;

 

THENCE, North 01 degrees 01 minutes 17
seconds East, with the common line between said Lot 2 and Cannaday tract, at a distance of 347.48 feet pass the northeast corner
of said Cannaday tract and the southeast corner of The Stages Addition, an addition to Collin County, Texas recorded in Cabinet
G, Page 633, Plat Records, Collin County, Texas; continuing, in all a distance of 468.44 feet to a 1/2-inch iron rod found at an
interior corner of said Lot 2 and an interior corner of said The Stages Addition;

 

THENCE, North 82 degrees 02 minutes 31
seconds East, with the common line between said Lot 2 and The Stages Addition, a distance of 41.08 feet to a 1/2-inch iron rod
found for an interior corner of Lot 2 and the northern most southeast corner of The Stages Addition;

 

THENCE, North 04 degrees 07 minutes 56
seconds East, with the common line between said Lot 2 and The Stages Addition, a distance of 99.01 feet to a 1/2-inch iron rod
found for the northeast corner of The Stages Addition, said point being also the southeast corner of a called 4.48 acre tract conveyed
to Dorothy Keeran by deed recorded in Volume 4486, Page 2884, Deed Records, Collin County, Texas;

 

THENCE, North 03 degrees 25 minutes 06
seconds East, with the common line between said Lot 2 and Keeran tract, at a distance of 347.68 feet pass the northeast corner
of said Keeran tract and the southeast corner of a called 7.293 acre tract conveyed to HFLP Real Estate, Ltd. by deed recorded
in County Clerk's File No. 06-1493040, Deed Records, Collin County, Texas; continuing, in all, a distance of 640.40 feet to a 5/8-inch
iron rod with "GSES, INC., RPLS 4804" cap found for the northwest corner of said Lot 2 and the most northerly southwest
corner of Lot 1, Block A of said Rockhill at Preston Addition;

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	43

    	 

    

 

THENCE, with the common line between said
Lots 1 and 2 the following metes and bounds:

 

South 89 degrees 43 minutes 20 seconds
East, a distance of 847.23 feet to a 5/8-inch iron rod with "GSES, INC., RPLS 4804" cap found for the northeast corner
of said Lot 2 and an interior corner of said Lot 1;

 

South 00 degrees 07 minutes 33 seconds
East, a distance of 818.40 feet to a 5/8-inch iron rod with "GSES, INC., RPLS 4804" cap found for the most easterly southeast
corner of said Lot 2 and an interior corner of said Lot 1; said point being also on the northwest line of a 170-foot Texas Power
& Light Company easement according to the document recorded in Volume 768, Page 324, Deed Records, Collin County, Texas;

 

South 51 degrees 27 minutes 26 seconds
West, with the northwest line of said 170-foot easement, a distance of 168.36 feet to a 5/8-inch iron rod with "GSES, INC.,
RPLS 4804" cap found for an angle point

 

South 38 degrees 54 minutes 37 seconds
West, with the northwest line of said 170-foot easement, a distance of 396.83 feet to a 5/8-inch iron rod with "GSES, INC.,
RPLS 4804" cap found for the most southerly southeast corner of said Lot 2 and a corner of said Stratton Drive; said point
being also the beginning of a circular curve to the left having a radius of 555.00 feet;

 

THENCE, with the south line of said Lot
2 and the north right-of-way line of Stratton Drive, the following metes and bounds:

 

Westerly, with said curve to the left,
through a central angle of 14 degrees 57 minutes 23 seconds, an arc distance of 144.88 feet (chord bears North 81 degrees 58 minutes
49 seconds West, 144.47 feet) to a 5/8-inch iron rod with "GSES, INC., RPLS 4804" cap found for the end of said curve,

 

North 89 degrees 27 minutes 31 seconds
West, a distance of 419.41 feet to the POINT OF BEGINNING;

 

CONTAINING, 1,011,049 square feet or 23.210
acres of land, more or less.

 

TRACT 2 (Easement Estate):

 

Description of a 1.019 acre easement out
of the Benjamin J. Naugle Survey, Abstract No. 663, in the City of Frisco, Collin County, Texas; said tract being a portion of
that called 113.0627 acre tract conveyed to 113 Preston Partners, Ltd. by deed recorded in Volume 5790, Page 4759, Deed Records,
Collin County, Texas; said 1.019 acre tract being more particularly described by metes and bounds as follows;

 

BEGINNING, at a Texas Department of Transportation
(TXDOT) monument in concrete found for the northeast corner of a 0.0478 acre tract of land conveyed to the State of Texas for the
right-of-way of State Highway 289 according to the County Clerk's File No. 20070131000139470, Deed Records, Collin County, Texas;
said point being on the north line of said 113.0627 acre tract; said point also being on the south line of a called 4.98 acre tract
of land conveyed to Edwina L. Cannaday by deed recorded in County Clerk's File No. 01-0165964, Deed Records, Collin County, Texas;

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	44

    	 

    

 

THENCE, South 89 degrees 27 minutes 31
seconds East, with the common line between said 113 Preston Partners, Ltd. tract and said Cannaday tract, a distance of 739.70
feet to a 1/2-inch iron rod found for an interior corner of said 113 Preston Partners, Ltd. tract and the southeast corner of said
Cannaday tract;

 

THENCE, South 00 degrees 41 minutes 52
seconds West, a distance of 60.00 feet to a point for corner;

 

THENCE, North 89 degrees 27 minutes 31
seconds West, parallel to and 60.00 feet perpendicularly distant from the common line between said 113 Preston Partners, Ltd. tract
and said Cannaday tract, a distance of 739.30 feet a point for corner on the east right-of-way line of State Highway 289 (Preston
Road, variable width);

 

THENCE, North 00 degrees 19 minutes 00
seconds East, with said east right-of-way line of State Highway 289, a distance of 60.00 feet to the POINT OF BEGINNING;

 

CONTAINING, 44,370 square feet or 1.019
acres of land, more or less.

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	45

    	 

    

 

EXHIBIT B

 

FORM OF SECURED PROMISSORY NOTE

 

(See Attached)

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	46

    	 

    

 

EXHIBIT C

 

PRO FORMA

 

(See attached)

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	47

    	 

    

 

EXHIBIT D

 

FORM OF ADVANCE REQUEST

  

(See Attached)

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	48

    	 

    

 

EXHIBIT E

 

FORM OF FINANCIAL STATEMENT CERTIFICATIONS

 

(See Attached)

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	49

    	 

    

 

EXHIBIT F

 

APPROVED BUDGET

 

(See Attached) 

 

    	Loan Agreement
Frisco 113, Collin County, Texas
	50

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