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Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 . Page 1 of 74 PURCHASE AGREEMENT This Purchase Agreement (the "Agreement") is made by and between Jerry R. Dunn (the Seller") and 3D Resorts, Inc. and/or its permitted assigns (the "Purchaser"). WITNESSETH: In consideration of the agreements herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Purchaser agree as follows: ARTICLE 1 Sale of Stocks, Partnership Interests and Membership Interests Subject to the terms and provisions of this Agreement, Seller agrees to sell to Purchaser, and Purchaser agrees to purchase from Seller, all stock, partnership interests and membership interests Seller owns in the corporations, partnerships and limited liability companies described in Exhibit "A" attached hereto (the "Entities"), which Entities own certain property, real, personal and intangible, wherever, located, and including, without limitation, the following described property: 1.1 all real estate owned by the Entities, including, without limitation, those certain tracts of land (collectively the "Property") described more fully in Exhibit "B" attached hereto. The Property shall also be deemed to include all interest, if any in (i) strips or gores, if any, between the Property and abutting properties; (ii) any property lying in or under the bed of any street, alley, road or right-of-way, opened or proposed, abutting or adjacent to the Property; (iii) water rights; and (iv) mineral rights, to the extent of the Entities' interests thereon; 1.2 the fences, roadways, ramps, utility conduits, buildings, structures and improvements on the Property (the "Improvements"), including, without limitation, all mechanical systems, fixtures and equipment if any, located in or on the Property and Improvements; 1.3the rights of the Entities in and to trade names, service

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Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 . Page 1 of 74

PURCHASE AGREEMENT

This Purchase Agreement (the "Agreement") is made by and between Jerry R. Dunn (the Seller") and 3D Resorts, Inc. and/or its permitted assigns (the "Purchaser").

WITNESSETH:

In consideration of the agreements herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Purchaser agree as follows:

ARTICLE 1Sale of Stocks, Partnership Interests and Membership Interests

Subject to the terms and provisions of this Agreement, Seller agrees to sell to Purchaser, and Purchaser agrees to purchase from Seller, all stock, partnership interests and membership interests Seller owns in the corporations, partnerships and limited liability companies described in Exhibit "A" attached hereto (the "Entities"), which Entities own certain property, real, personal and intangible, wherever, located, and including, without limitation, the following described property:

1.1 all real estate owned by the Entities, including, without limitation, thosecertain tracts of land (collectively the "Property") described more fully in Exhibit "B" attached hereto. The Property shall also be deemed to include all interest, if any in (i) strips or gores, if any, between the Property and abutting properties; (ii) any property lying in or under the bed of any street, alley, road or right-of-way, opened or proposed, abutting or adjacent to the Property; (iii) water rights; and (iv) mineral rights, to the extent of the Entities' interests thereon;

1.2 the fences, roadways, ramps, utility conduits, buildings, structures andimprovements on the Property (the "Improvements"), including, without limitation, all mechanical systems, fixtures and equipment if any, located in or on the Property and Improvements;

1.3 the rights of the Entities in and to trade names, service marks andintellectual property rights (the "Intellectual Property"), and licenses, registrations, and advertising materials, slogans, logos, telephone exchange numbers and other rights of the Entities related to the Property and/or the Improvements;

1.4 all personal property, including, without limitation, keys, alarm codes,furniture, equipment, office supplies, materials and other personal property owned by the Entities, now located on or within the Property, the Improvements or any office used by the Entities and/or used in connection therewith, if any (the "Personal Property");

1.5 all utility deposits, reserve accounts, escrow funds, accounts receivable, andnotes receivable, if any;

EXHIBIT

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1.6 all agreements relating to the operation, services or maintenance of theProperty, Improvements and Personal Property (the "Operating Agreements"), if any;

1.7 all site plans, surveys, soil and substrata studies, architectural renderings,plans and specifications, appraisals, engineering plans, inspection reports, HUD registrations and environmental studies, if any, which relate to the Property, Improvements or Personal Property;

1.8 all leasing brochures, market studies, tenant data sheets and other materialsrelated to the operation or development of the Property, if any;

1.9 warranties and guaranties relating to the Improvements and PersonalProperty, and all of Seller's interests in and to any other property, wherever located and however titled or held, if any; and

1.10 all claims, rights, suits, and causes of action, including, without limitation, all environmental and contractual claims or causes of action, if any.

ARTICLE 2Earnest Money Deposit

2.1 Amount of Earnest Money. Purchaser shall, within three (3) business days after theExecution Date (defined in Section 13.12 hereof), deposit with the law firm of Minor & Brown P.C., 650 South Cherry Street, Suite 1100, Denver Colorado 80246, or such other person or entity as Seller may designate in writing, (hereinafter referred to as the "Escrow Agent"), in cash, wire transfer or cashier's check, the amount of Fifty Thousand Dollars ($50,000.00) (the "Earnest Money Deposit"), Ten Thousand Dollars ($10,000.00) of which Earnest Money Deposit shall be non-refundable and fully vested in Seller as an independent contract consideration (the "Independent Contract Consideration"), but all of which shall be credited against the Purchase Price (as defined in Section 3.1 hereof) at the 'Closing (as defined in Section 7.1 hereof) notwithstanding any term or provision to the contrary set forth herein. The Escrow Agent shall promptly, upon receipt, deposit such cash or cashier's check in a non-interest-bearing COLTA account. The parties hereby agree that in the event of any dispute regarding the Earnest Money Deposit, the Escrow Agent shall immediately deliver the Independent Contract Consideration to the Seller and the balance of the Earnest Money Deposit to Purchaser. Such disbursement by the Escrow Agent shall in no way impact any of the rights, claims or obligations of the Purchaser or Seller to the other or the rights of either party to enforce the terms and provisions of this Agreement as otherwise provided herein.

At the end of the Inspection Period (as defined in Section 5.2 herein), in the event Purchaser elects to proceed with the Agreement, the Earnest Money Deposit shall be firm, committed and non-refundable except in the event of a material default by Seller.

As used herein, the term "business day" shall mean any day other than a Saturday, Sunday or date on which national banks are not open for business.

2.2 Application. At the Closing, the Earnest Money Deposit (including theIndependent Contract consideration) and all interest accrued thereon shall be applied as a

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credit against the Purchase Price (as defined in Section 3.1 hereof). In the event that the Closing does not occur, the Earnest Money Deposit shall be refunded to Purchaser or paid to Seller in accordance with the provisions of this Agreement, save and except the Independent Contract Consideration, which shall be paid to Seller.

ARTICLE 3Purchase Price

3.1 Payment of Purchase Price. The total purchase price for the Seller's interest

in the Entities, including the Entities' interest in and to the Property, the Intellectual Property and the Personal Property (the "Purchase Price") shall be (i) Four Million, four hundred, thirty-seven thousand, two-hundred fifty and No/100 Dollars ($4,437,250.00), to be paid in accordance with the schedule attached hereto as Exhibit "C" (the "Cash Consideration") and (ii) the assumption by Purchaser of all indebtedness , obligations, accrued liabilities, lease commitments, employment contracts, personal guarantees and accounts payable of the Seller or the Entities related to or in connection with the Entities described in Exhibit "D" attached hereto (the "Indebtedness")

3.2 Security for Purchase Price. The Purchase Price shall be secured by first

deeds of trust (collectively, the "Deeds of Trust"), in form reasonably satisfactory to the parties hereto, on (i) the golf courses located within the Feather Bay Subdivision and the Village of Lone Oaks Subdivision, and (ii) a three hundred (300) acre, more or less, tract of unplatted land in the Feather Bay Subdivision, the boundaries and terms of lien releases to be agreed upon by the parties hereto prior to the expiration of the Inspection Period, both parties agreeing herein to exercise good faith and fair dealing in reaching such agreement, which may include requirements for replacement of property in the event portions of the above described property are sought to be released before the Cash Consideration has been paid in full (the "Lot Release Agreement").

ARTICLE 4Title and Survey

4.1 Title Polices. Seller shall, within five (5) days after the Execution Date, cause

to be furnished to Purchaser all title polices affecting or relating to the Property. Seller shall further cause to be furnished to Purchaser true copies of all instruments referred to in the title polices as conditions or exceptions to title to the Property (the "Title Documents").

4.2 Survey. Seller shall, within five (5) days after the Execution Date, furnish to Purchaser all existing surveys affecting or relating to the Property or the Improvements (the "Surveys").

ARTICLE 5Investigation by Purchaser

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(a) copies of all service agreements relating to the Property and thePersonal Property;

(b) copies of ad valorem tax statements for each of the tracts composingthe Property and the Personal Property from 2004 to the Execution Date;

(c) an inventory of the Personal Property, certified by Seller as being trueand correct in all material respects;

(d) operating statements of the Entities for the years 2004, 2005 and2006, and for the ten (10) month period ending October, 2007, and supporting documentation of income and expenses for the months of November and December 2007, certified by Seller as being true and correct in all material respects;

(e) copies of all Federal Income Tax returns and schedules of the Entities,certified by Seller as being true, complete and correct, for the years 2004through 2006;

(f) any environmental reports relating to the Property in Seller's or theEntities' possession or control;

(g) any 2004 or later appraisals of the Property in Seller's or the Entities'possession or control;

(a) copies of all prior years' HUD sales registration documents relating tothe Property;

(b) copies of insurance policies obtained by the Entities covering theEntities and/or the Property and Improvements, and loss runs or claims since 2004; and

(i) any engineering report or study relating to the Property in Seller's orthe Entities' possession or control.

5.2 Inspection Period. Purchaser shall have a period of time (the "Inspection Period") commencing on the Execution Date and expiring thirty (30) days later, during which Purchaser may review the Submission Items, physically inspect the Property and Improvements and analyze the physical condition of the Property and to conduct any and all other inspections and tests which Purchaser may require, including, without limitation, environmental tests. Further, until the Closing Date, Purchaser or Purchaser's authorized representatives shall have the right from and after the Execution Date, after twenty-four (24) hours prior oral notice to Seller, to enter upon the Property and make tests, including, without limitation, soil tests. Such inspections shall be at Purchaser's sole cost and expense and are to be conducted in a manner as not to materially damage the Property or unreasonably interfere with the usual business operations of the Property or the Entities. PURCHASER AGREES TO INDEMNIFY AND HOLD HARMLESS SELLER AND THE 4

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RESULT OF PURCHASER'S EXERCISE OF THE RIGHTS GRANTED IN THIS SECTION 5.2. SUCH INDEMNIFICATION SHALL SURVIVE THE TERMINATION OR CLOSING OF T H I S A G R E E M E N T F O R A P E R I O D O F T W E L V E M O N T H S ( 1 2 ) M O N T H S THEREAFTER.

If Purchaser does not wish to Close, then on or before the expiration of the Inspection Period, Purchaser shall indicate its intent to terminate this Agreement by delivering written notice of such to Seller, in which event this Agreement shall terminate and the Earnest Money Deposit (less the Independent Contract Consideration ) shall be returned by the Escrow Agent to Purchaser. If Purchaser fails to timely deliver such written notice of termination to Seller on or before the expiration of the Inspection Period, then this Agreement shall continue and the Earnest Money Deposit shall become firm and non -refundable except in the case of a material default of this Agreement by Seller. Following the expiration of the Inspection Period, Purchaser shall have the right to continue inspections as described herein from time to time, after twenty-four (24) hours prior notice to Seller.

5.3 Inspection of Books and Records. From the Execution Date until the ClosingDate, Purchaser shall have the right to examine and inspect and shall have complete access to all books and records of the Entities that relate to the Property, the Personal Property and the Intellectual Property after twenty-four (24) hours prior notice to Seller, and the same shall be made available to Purchaser at the offices of the Entities during normal business hours.

ARTICLE 6

Representations and Warranties

6.1 Representations and Warranties of Seller. Seller represents and warrants toPurchaser that, to the best of his knowledge, as of the date hereof and as of the Closing Date (unless otherwise disclosed to Purchaser in writing) that:

(a) the execution, performance and delivery of this Agreement are within his power and have been duly authorized by the Entities, to the extent necessary;

(b) Seller and/or the Entities are not prohibited from consummating the transactions contemplated by this Agreement by any law, regulation, agreement, instrument, restriction, order or judgment;

(c) Seller and/or the Entities have not obligated themselves in any manner whatsoever to sell or otherwise dispose of the Property, or any part thereof, to any party other than Purchaser, except in the ordinary course of business of the Entities;

(d) Seller and/or the Entities are not a "foreign person" within the meaning of Section 1445 of the Internal Revenue Code, and at the Closing, Seller and the Entities (if reasonably required by the Purchaser) will deliver a sworn "Non-Foreign Affidavit" to such effect to Purchaser;

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(e) Seller and/or the Entities have received no notice from any source,

governmental or otherwise, (i) that the Property is currently subject to any existing, pending or threatened investigation or inquiry by any governmental agency or authority, or (ii) of any violation of any applicable law, rule, or ordinance concerning environmental status, environmental hazards or contamination at the Property;

(f) Seller and/or the Entities have not received any written notice from any

governmental agency that the Property is currently in violation of any applicable law, ordinance, regulation, statute, rule or restriction;

(g) Seller and/or the Entities have not received notice of any pending,

threatened or contemplated condemnation actions or special assessments with respect to the Property;

(h) there are no debts, obligations or accounts payable by Seller or the Entities except as set forth in Exhibit "D" attached hereto") or otherwise reasonably incurred by Seller or the Entities in the ordinary course of business or with Developer Finance Corporation ("DFC") after the Execution Date and with Purchaser's prior consent, which consent shall not be unreasonably withheld or delayed;

(i) there are no claims, demands, actions or other suits pending or threatened against Seller or the Entities or against the Property involving or seeking in excess of Two Thousand Dollars ($2,000.00) each, except as set forth in Exhibit"E" attached hereto (the "Claims");

(j) there are no other parties or entities that own, directly or indirectly, any interest in the Entities other than Seller except as set forth in Exhibit"F" attached hereto (the "Third Party Owners"); and

(k) the sales of lots in the Property comply with all federal, state and local laws, statues and ordinances, including without limitation, the Interstate Land Sales Full Disclosure Act (the "lLSFDA") and the Texas Deceptive Trade Practices Act (the "DTPA").

6.2 Representations and Warranties of Purchaser. Purchaser represents andwarrants to Seller that, to the best of its knowledge, as of the date hereof and as of the Closing Date that:

(a) the execution and delivery by Purchaser of, and Purchaser'sperformance under this Agreement, are within Purchaser's powers, have been duly _authorized by all requisite parties, and the person executing this Agreement on

behalf of Purchaser has the authority to do so; and

(b) the Purchaser is not prohibited from consummating the transactionscontemplated in this Agreement by any law, regulation, agreement,

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6.3 Survivability. The representations and warranties of Seller and the Purchasercontained in this Article 6 shall survive the Closing as set forth in Sections 12.3 and 12.4 hereof.

ARTICLE 7C losin g

7.1 Time and Place of Closing. Provided that all of the conditions to Purchaser'sobligations under this Agreement shall have been satisfied in accordance with the terms hereof or waived in writing by Purchaser prior to the date of the Closing (the "Closing Date"), the Closing of this transaction shall take place at 6000 Greenwood Plaza, Suite 120, Greenwood Village, CO 80111 at 10:00 a.m. local time on that date which is ten (10) days after the expiration of the Inspection Period to be effective as of January 1, 2008 (the "Effective Date"). Notwithstanding anything contained herein, the Purchaser can accelerate the Closing Date to occur prior to the date above by giving written notice to Seller five (5) business days before the day that it intends to close. Either party hereto may terminate this Agreement if the Closing does not occur by February 29, 2008, unless such delay is caused by the acts or omissions of either party; and in such event, the Earnest Money Deposit shall be returned to Purchaser, less the Independent Contract Consideration which shall be delivered to Seller, and the obligations of each party to the other shall cease.

7.2 Expenses. Seller and Purchaser shall each pay one-half (1/2) of the escrowfee charged by the Escrow Agent and each party shall bear their own attorney's fees, all other expenses hereunder shall be paid by the party incurring such expenses.

7.3 Deliveries at Closing. At the Closing:

(a) Seller shall deliver or cause to be delivered to Purchaser the following:

(i) all partnership interests held by Seller in any partnershipdescribed in Exhibit "A;"

(ii) all stock certificates held by Seller in any corporation describedin Exhibit "A;"

(iii) all certificates of Ownership or similar instruments held bySeller in any limited liability company described in Exhibit "A;"

(iv) such other evidence of the authority and capacity of Seller andthe Entities as Purchaser may reasonably require;

(v) a Non-Foreign Affidavit substantially in the form attachedhereto as Exhibit "G" and made a part hereof, duly executed by Seller and/or the Entities as Purchaser may reasonably require;

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(vi) a certificate executed by or on behalf of Seller and dated as of the Closing Date, certifying that there are no unpaid debts, liabilities or obligations with respect to the Property other than the Indebtedness;

(vii) a certificate executed by or on behalf of Seller and dated as of the Closing Date, certifying that Seller has no knowledge of any claims, demands, actions or suits pending or threatened against the Entities, the Property, the Personal Property or the Intellectual Property other than the Claims;

(viii) a certificate executed by or on behalf of Seller and dated as of the Closing Date, certifying that there are no owners (directly or indirectly) of the Entities other than the Third Party Owners;

(ix) evidence reasonably acceptable to Purchaser authorizing the consummation by Seller of the purchase and sale transactions contemplated hereby and the execution and delivery of the Closing documents on behalf of or by Seller;

(x) all keys to all locks on the Property and all security codes relating to the Property, in Seller's possession;

(xi) to the extent assignable and in Seller's name, all permits issued by appropriate governmental authorities, agreements with utility companies and lease agreements concerning or related to the Property, ; and

(xii) all plans, specifications, mechanical, electrical and plumbing layouts, operating manuals, leasing information and the like in Seller's possession in connection with the construction or operation of the Property.

Seller shall also execute and deliver such other documents and take such other action as may be reasonably required to consummate the transactions contemplated herein, including, without limitation, the Lot Release Agreement.

(b) Purchaser shall execute and deliver to Seller the Deeds of Trust, and

deliver to Seller the cash portion of the Purchase Price required pursuant to Article 3 hereof in immediately available funds. Purchaser shall also execute and deliver such other documents, including, without limitation, the Lot Release Agreement and a full and final release of the DFC Guarantees (as defined in Section 13.14 hereof), and take such other action as may reasonably be required to consummate the transactions contemplated herein.

ARTICLE 8Interim Responsibilities of Seller

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8.1 maintain the Property and Personal Property in as good condition and state

of repair as that existing on the Execution Date of this Agreement, subject, however, to ordinary wear and tear and to Section 13.1 hereof;

8.2 not enter into or modify any operating agreement or other agreements with

respect to the operation or maintenance of the Property which cannot be terminated without penalty on notice of thirty (30) days or less, without the prior written consent of Purchaser, which consent shall not be unreasonably withheld or delayed;

8.3not market, lease, contract for sale, option, sell, or otherwise dispose of the

Property or any portion thereof except in the ordinary course of the Entities' business;

8.4 use good faith efforts make all payments on any existing mortgage, loan or

lease when due, and to comply timely with all other provisions of the documents relating to any existing mortgage loan or lease;

8.5not, without the prior written consent of Purchaser, which consent shall not

be unreasonably withheld or delayed, remove any Personal Property f rom the Improvements, except in the ordinary course of business, in which case the removed Personal Property shall be replaced with property of comparable utility and value; and

8.6keep all existing insurance policies relating to the Property in full force and

effect, unless the prior written consent of Purchaser is first obtained.

ARTICLE 9Conditions Precedent to Seller's Obligation to Close

Seller's obligation to consummate the transactions contemplated hereunder is conditioned upon satisfaction of each of the following conditions at or prior to the Closing (or such earlier date as is specified with respect to a particular condition):

9.1 Purchaser shall not have terminated this Agreement during the Inspection

Period;

9.2Purchaser shall not have committed a material breach of this Agreement;

9.3 Purchaser shall have substantially complied with all material and substantive covenants set forth herein;

9.4 all the representations and warranties set forth in Section 6.2 above shall be materially and substantially true and correct as of the Closing Date;9

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ARTICLE 10Conditions Precedent to Purchaser's Obligation to Close

Purchaser's obligation to consummate the transactions contemplated hereunder is conditioned upon satisfaction (or written waiver by Purchaser) of each of the following conditions at or prior to the Closing (or such earlier date as is specified with respect to a particular condition):

10.1 the Seller shall have substantially complied with all material and substantive covenants set forth herein;

10.2 all the representations and warranties set forth in Section 6.1 above shall be materially and substantially true and correct as of the Closing Date; and

10.3 all of the documents required to be delivered to Purchaser at Closing have been delivered; including, without limitation, the Lot Release Agreement.

If any of the conditions precedent set forth in this Article 10 shall fail to be satisfied as of the Closing, Purchaser may terminate this Agreement and receive a complete refund of the Earnest Money (save and except the Independent Contract Consideration and any interest earned thereon) or waive same and proceed to Closing, whether or not the Inspection Period has expired.

ARTICLE 11Termination, Default and Remedies

11.1 Permitted Termination. If this Agreement is terminated by either party pursuant to a right expressly given it to do so hereunder (herein referred to as a "Permitted Termination"); then the Earnest Money Deposit (save and except the Independent Contract Consideration) shall promptly be returned to Purchaser.

11.2 Purchaser's Riqht to Terminate. At any time prior to the expiration of the Inspection Period, Purchaser shall have the right to terminate this Agreement for any or no reason whatsoever, by giving written notice of such termination to Seller. Upon such termination, the Earnest Money Deposit (save and except the Independent Contract Consideration), shall promptly be returned to Purchaser, and Purchaser shall have no further liability to Seller whatsoever, except as otherwise provided in Section 5.2 hereof.

.11.3 Default by Seller. Seller shall be in default hereunder upon the occurrence of any one or more of the following events:

(a) any of Seller's representations or warranties expressly set forth hereinare untrue or inaccurate in any material and substantial respect; or

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(b) except as otherwise set forth herein, Seller shall fail to substantiallymeet, comply with or perform any covenant, agreement, or obligation on Seller's part required, within the time limits and in the manner required in this Agreement, for any reason other than a Permitted Termination.

In the event of a default by Seller hereunder, Purchaser, as its sole and exclusive remedy, may (i) terminate this Agreement by written notice delivered to Seller at or prior to the Closing and receive the Earnest Money Deposit, less the Independent Contract Consideration, (ii) enforce specific performance of this Agreement or (iii) pursue all other rights and remedies, at law and/or in equity, and all such remedies shall be cumulative and the exercise of any one remedy shall not waive or preclude the right to exercise any other remedy.

11.4 Default by Purchaser. Purchaser shall be in default hereunder upon the occurrence of any one or more of the following events:

(a) any of Purchaser's representations or warranties expressly set forthherein are untrue or inaccurate in any material and substantial respect; or

(b) except as otherwise set forth herein, Purchaser shall fail tosubstantially meet, comply with or perform any covenant, agreement, or obligation on Purchaser's part required, within the time limits and in the manner required in this Agreement, for any reason other than a Permitted Termination.

In the event of a default by Purchaser hereunder, Seller, as his sole and exclusive remedy for such default, shall be entitled to terminate this Agreement by notice to Purchaser and to immediately receive from the Escrow Agent, as his liquidated damages, the Earnest Money Deposit, it being agreed between Purchaser and Seller that Seller's damages in the event of a default by Purchaser are difficult to ascertain.

11.5 Attorney's Fees. If it shall be necessary for either Purchaser or Seller to employ an attorney to enforce its rights pursuant to this Agreement because of the default of the other party, the defaulting party shall reimburse the non-defaulting party for reasonable attorney's fees. The provisions of this Section 11.5 shall survive the Closing.

ARTICLE 12 Indemnification

12.1 Indemnification by Seller. SELLER AGREES TO INDEMNIFY AND HOLD THE PURCHASER HARMLESS FROM ANY AND ALL CLAIMS, DEMANDS, ACTIONS OR SUITS FILED OR THREATENED BY THIRD PERSONS AGAINST THE ENTITIES OR AGAINST THE PROPERTY, THE INTELLECTUAL PROPERTY OR THE PERSONAL PROPERTY (AN "ACTION"), RESULTING FROM OR ARISING OUT OF THE ACTIONS, INACTIONS OR OMISSIONS OF SELLER, THE ENTITIES OR THE EMPLOYEES, AGENTS OR REPRESENTATIVES OF EITHER THE SELLER OR THE ENTITIES, WHICH OCCURRED OR ARE ALLEGED TO HAVE OCCURRED PRIOR TO THE CLOSING, AND WHICH ARE NOT SET FORTH IN EXHIBITS "D," "E" -OR "F" (THE "UNDISCLOSED CLAIMS"); PROVIDED, HOWEVER, THAT IN NO EVENT SHALL SELLER'S INDEMNIFICATION HEREUNDER EXCEED AN AMOUNT EQUAL TO THE CASH

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CONSIDERATION. ANY DAMAGES, EXPENSES OR COSTS INCURRED BY PURCHASER, INCLUDING REASONABLE ATTORNEY'S FEES, (THE "DAMAGES") AS A RESULT OF AN ACTION SHALL BE DEDUCTED FIRST FROM THE UNPAID BALANCE OF THE CASH CONSIDERATION, IF ANY. IF THE UNPAID BALANCE OF THE CASH CONSIDERATION IS INSUFFICIENT TO PAY THE DAMAGES INCURRED BY PURCHASER, SELLER SHALL PROMPTLY REPAY PURCHASER THE BALANCE OF THE DAMAGES.

12.2 Indemnification by Purchaser. PURCHASER AGREES TO INDEMNIFY AND HOLD SELLER HARMLESS FROM (i) THE INDEBTEDNESS, INCLUDING, WITHOUT LIMITATION THE DUNN GUARANTEES (AS DEFINED IN SECTION 13.14 HEREOF) AND (ii) ANY ACTION FILED OR THREATENED BY THIRD PERSONS AGAINST SELLER, RESULTING FROM OR ARISING OUT OF THE ACTIONS, INACTIONS OR OMISSIONS OF PURCHASER OR THE ENTITIES OR THE EMPLOYEES, AGENTS OR REPRESENTATIVES OF EITHER THE PURCHASER OR THE ENTITIES, WHICH OCCURRED OR ARE ALLEGED TO HAVE OCCURRED AFTER THE CLOSING.

12.3 Survivability of Seller's Indemnification. The indemnification and hold harmless provision provided in Section 12.1 hereof shall continue from the Closing for:

(a) two (2) years with respect to any claim, demand, action or suit not disclosed herein (an "Undisclosed Claim") alleging personal injury or damage to property;

(a) two (2) years with respect to any Undisclosed Claim alleging anownership interest in the Entities;

(b) two and one-half (2%) years with respect to any Undisclosed Claimalleging fraud or violation of the ILSFDA or the DTPA;

(c) four (4) years with respect to any Undisclosed Claim alleging breach of contract;

(d) four (4) years with respect to any Undisclosed Claim alleging unpaiddebts, obligations, accounts payable or other indebtedness; and

two (2) years with respect to any other claim, demand or suit.

12.4 Survivability of Purchaser's Indemnification. The indemnification and hold harmless provision provided in Section 12.2 hereof shall continue from the Closing:

(a) until the Indebtedness (including the Dunn Guarantees) is paid in full;

and

(b) for four (4) years for any Action filed or threatened against Seller resulting from or arising out of the actions, inactions or omissions of Purchaser or the Entities or the employees, agents or representatives of either the Purchaser or the Entities which occurred or are alleged to have occurred after the Closing.

12.5 Insurance Policies. Purchaser agrees to keep in full force and effect (with current deductibles) any insurance policy in existence as of the Closing Date or, at Purchaser's sole option, obtain tail insurance for the benefit of Seller (with same deductable), if the effect of a cancellation, modification or change in any such policy would cause a termination of applicable insurance coverage of any claim against the Seller, the

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Entities or the Property for actions, inactions or omissions alleged to have occurred prior to the Closing.

ARTICLE 13Miscellaneous

13.1 Damage to Property. Seller agrees to give Purchaser prompt notice of any fire or other casualty affecting the Property or the Improvements between the date hereof and the Closing Date, or of any actual or threatened taking or condemnation of all or any portion of the Property or the Improvements, or of any claim or suit pertaining to Seller and/or the Entities or the Property between the date hereof and the Closing Date.

(a) If prior to the Closing there shall occur:

(I) damage to the Property caused by fire or other casualty which

would cost $100,000.00 or more to repair; or

(ii) the taking or condemnation of all or any portion of the Property

and the Improvements which would materially interfere with the use thereof;

then in any such event, Purchaser may at its option terminate this Agreement by notice to the other party within twenty (20) days after Purchaser has received the notice referred to above or on the Closing Date, whichever is earlier, and in such event, the Earnest Money Deposit shall be returned to Purchaser, less the Independent Contract Consideration which shall be delivered to Seller, and the obligations of each party to the other shall cease. If Purchaser does not elect to terminate this Agreement, then the Closing shall take place as provided herein without abatement of the Purchase Price, and there shall be assigned to Purchaser at the Closing any interest of Seller in and to any insurance proceeds (subject to confirmation by Seller that such assignment will not impair such insurance) or condemnation awards which may be payable to Seller on account of any such occurrence. If such assignment would impair such insurance, then Seller shall be obligated to pay Purchaser, at Closing, an amount equal to any insurance proceeds which would be payable to Seller, if any, on account of such occurrence.

(b) If prior to the Closing there shall occur:

(i) damage to the Property caused by fire or other casualty which would cost less than $100,000.00 to repair; or

(ii) the taking or condemnation of a portion of the Property and the Improvements which would not materially interfere with the use thereof:

then, in any such event, Purchaser shall have no right to terminate its obligations under this Agreement, but there shall be assigned to Purchaser at Closing any and all interest of Seller in and to any insurance proceeds (subject to confirmation by Seller that such assignment will not impair such insurance) or condemnation awards which may be payable to

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Notwithstanding anything contained in this Section 13.1 to the contrary, if prior to Closing there shall occur (i) damage to the Property caused by fire or other casualty which would cost more than $100,000.00 to repair, or (ii) the taking or condemnation of a portion of the Property and the Improvements, and Seller's and/or the Entities' lenders elect to apply any insurance proceeds or condemnation proceeds (as the case may be) to the reduction of the indebtedness of any existing mortgage, then, in any such event, Purchaser shall have the option of either terminating this Agreement within twenty (20) days of actual receipt of such decision or proceeding with Closing, in which later event there shall be no abatement of the Purchase Price except as may be caused by the reduction of the indebtedness of any existing mortgage on the Property.

13.2 Brokerage Commission. No brokerage or other commission is payable by either Seller or Purchaser in connection with the execution of this Agreement or the consummation of the transactions contemplated herein. Seller agrees to indemnify Purchaser and hold Purchaser harmless from any loss, liability, damage, cost or expense (including, without limitation, court costs and reasonable attorney's fees) paid or incurred by Purchaser by reason of any claim to any broker's, finder's or other fee in connection with this transaction by any party claiming by, through or under Seller. Purchaser agrees to indemnify and hold Seller harmless from any loss, liability, damage, cost or expense (including, without limitation, court costs and reasonable attorney's fees) paid or incurred by Seller by reason of any claim to any broker's, finder's or other fee in connection with this transaction by any party claiming by, through or under Purchaser. The terms and provision of this Section 13.2 shall survive the Closing.

13.3 Assignment. It is specifically agreed that the rights of Purchaser under this Agreement may be assigned to any affiliated entity designated by Purchaser, upon five (5) business days' prior written notice to Seller but without the prior written consent of Seller. No assignment may delay the Closing or otherwise affect Seller's rights or obligations hereunder, and no assignment shall release the Purchaser from its obligations hereunder.

13.4 Notices. All notices, demands, requests and other communications required or permitted hereunder shall be in writing, and shall be sent by (i) United States mail, registered or certified, postage fully prepaid, or (ii) priority delivery service (such as Federal Express); or (iii) facsimile delivery (with confirmation of transmittal) addressed to theaddressee at its address set forth below or at such other address as such party may have specified theretofore by notice delivered in accordance with this Section and actually received by the addressee:

If to Seller:Jerry R. Dunn6000 Greenwood Plaza Blvd., Suite 120 Greenwood Village, CO 80111

With a copy toMinor & Brown, P.C.650 South Cherry Street, Suite 1100 Denver, CO 80111Attn: Lisa D'Ambrosia

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If to Purchaser: 3D Resorts, Inc.25675 Overlook Parkway, Suite # 506 San Antonio, Texas 78260

Attn: William Palmer

Any such notice shall be deemed to have been given either at the time of personal delivery or, in the case of priority delivery service or by mail, at the time such notice is deposited with such delivery service or deposited in the U.S. mail, respectively, or in the case of facsimile, upon transmission.

13.5 Governing Law; Venue. The laws of the State of Texas shall govern the validity, enforcement and interpretation of this Agreement. The obligations of the parties are performable and venue for any legal action arising out of this Agreement shall lie in Comal County, Texas.

13.6 Integration; Modification; Waiver. This Agreement constitutes the complete and final expression of the agreement of the parties relating to the Property, and supersedes all previous contracts, agreements, and understandings of the parties, either oral or written, relating to the Property. This Agreement cannot be modified, or any of the terms hereof waived, except by an instrument in writing (referring specifically to this Agreement) executed by the party against whom enforcement of the modification or waiver is sought.

13.7 Counterpart Execution. This Agreement may be executed in several counterparts, each of which shall be fully Execution as an original and all of which together shall constitute one and the same instrument.

13.8 Headings; Construction. The headings which have been used throughout this Agreement have been inserted for convenience of reference only and do not constitute matter to be construed in interpreting this Agreement. Words of any gender used in this Agreement shall be held and construed to include any other gender and words in the singular number shall be held to include the plural, and vice versa, unless the contextrequires otherwise. The words "herein," "hereof," "hereunder" and other similar compounds of the word "here" when used in this Agreement shall refer to the entii.e.Agreement and not to any particular provision or section. If the last day of any time period stated herein shall fall on a Saturday, Sunday or legal holiday, then the duration of such time period shall be extended so that it shall end on the next succeeding day which is not a Saturday, Sunday or legal holiday.

.13.9 Invalid Provisions. If any one or more of the provisions of this Agreement, or the applicability of any such provision to a specific situation, shall be held invalid or unenforceable, such provision shall be modified to the minimum extent necessary to make it or its application valid and enforceable, and the validity and enforceability of all other provisions of this Agreement and all other applications of any such provision shall not be affected thereby.

13.10 Binding Effect. This Agreement shall be binding upon and inure to the benefit of Seller and Purchaser, and their respective heirs, personal representatives, successors and/or assigns. Except as expressly provided herein, nothing in this Agreement is intended

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to confer on any person, other than the parties hereto and their respective heirs, personal representatives, successors and/or assigns, any rights or remedies under or by reason of this Agreement.

13.11 Exhibits. 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 expressly understood that if any exhibit attached hereto which is to be executed and delivered at Closing contains blanks, the same shall be completed correctly and in accordance with the terms and provisions contained herein and as contemplated herein prior to or at the time of execution and delivery thereof.

13.12 Execution Date. The date of this Agreement (herein called the "Execution Date") shall for all purposes be the date of the signature of the last party hereto.

13.13 Time. Time is of the essence in the performance of all obligations of the parties under this Agreement. In the event any deadline set forth herein is not timely met, there shall be no extension given other than as may be agreed to in writing by both parties in their sole and absolute discretion.

13.14 Release of Personal Guarantees. Purchaser shall obtain and deliver toSeller at Closing the full and final release of all guarantees executed by Seller for the benefit of DFC (the "DFC Guarantees"). Furthermore, Purchaser shall, within six (6) months from the Execution Date, exercise commercially reasonable efforts to obtain releases of any other personal guarantee of Seller related to or in connection with the Property or the Entities listed as Indebtedness (the "Additional Guarantees"). The DFC Guarantees and the Additional Guarantees are collectively referred to herein as the "Dunn Guarantees." The inability of Purchaser to obtain any release of any of the Additional Guarantees, after exercising due diligence, shall not be deemed to be a breach of any covenant between the parties hereto or relieve Purchaser of its obligation to indemnify Seller therefrom as otherwise provided in Section 12.2 hereof.

13.15 Assignment of Life Insurance. Purchaser shall cause Developer Finance Corporation to assign all life insurance policies currently held by it, directly or as security or a collateral assignment, on Seller's life to be assigned to Seller or his designee on or before the Closing.

13.16 Employment Agreement for Casey Dunn. Purchaser shall enter into an employment agreement with Casey Dunn for a period of at least one (1) year following the Closing on terms reasonably acceptable to Purchaser and Casey Dunn.

13.17 Use of Office Space. So long as Purchaser shall maintain any offices in Denver Colorado, as it may elect to do so in its sole discretion, Seller shall have the right to use any available office therein and reasonable use of office staff, without cost to Seller.

13.18 Inspection of Books and Records. From the Closing Date until the Cash Consideration shall have been paid in full, Seller shall have the right to examine and inspect all books and records of the Entities that relate to the Property, as may be reasonably and necessarily required by Seller, after seventy-two (72) hours prior notice to Purchaser, at the offices of the Entities during normal 16

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audit of Seller or similar inquiry, provided that Seller first give Purchaser seventy-two (72) hours prior notice of such inspection.

13.19 Additional Borrowing of Purchaser. Until the Cash Consideration is paid in full, Purchaser shall not borrow any money in the Entities' name or pledge any property (real, personal, tangible or intangible) of the Entities for debts or obligations not related or connected with the Properties.

13.20 Tax Considerations. Notwithstanding anything to the contrary herein contained and prior to the expiration of the Inspection Period, the parties hereto agree to exercise good faith and fair dealing to determine the method for payment of the Cash Consideration in a manner to produce the most favorable tax consequences for both parties.

SELLER:

Jer R. D nn

Execute• by Seller on January 12-, 2008.

PURCHASER:

3D Resorts, Inc., a Texas Corporation

William Palme ice President & GeneralCounsel

Executed by Purchaser on January 14, 2008.

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The undersigned hereby acknowledges receipt of this Purchase Agreement this________dayof January, 2008, and agrees to disburse the Earnest Money Deposit and Independent Contract Consideration in accordance with the terms and provisions thereof.

Escrow Agent

B y : N a m e : Title:

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EXHIBIT "A"

ENTITIES

To be attached within fifteen (15) days of the Execution Date

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EXHIBIT "B"

REAL PROPERTY

To be attached within fifteen (15) days of the Execution Date

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EXHIBIT "C"

PAYMENT SCHEDULE

Purchaser shall pay the Purchase Price to Seller, (i) by causing the Escrow Agent to transfer the Earnest Money Deposit (including any interest earned thereon) to Seller at the Closing, and (ii) thereafter, on a biweekly basis, after expiration of the cancellation period set forth in the Interstate Land Sales Full Disclosure Act, as follows:

(a) in the event of lot sales, the product of One thousand, Six hundred, and no/100 Dollars ($1,600) times the number of lots sold in the subdivisions which constitute the Property during the previous two (2) weeks;

(b)in the event of a bulk sale or acreage sale of the Property or any portion thereof of one (1) or more acres, the product of One thousand, Six hundred, and no/100 Dollars ($1,600) times the average number of lots platted in the applicable subdivision which constitutes the Property; and

(a) such payments shall continue until the Purchase Price is paid in full; provided, however, that in the event any portion of the Purchase Price remains unpaid as of January 1, 2012, Purchaser shall pay Seller a lump sum equal to the unpaid portion of the Purchase Price on said date.

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EXHIBIT "0"

INDEBTEDNESS

To be attached within fifteen (15) days of the Execution Date

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Exhibit D 1

EXHIBIT "D"

INDEBTEDNESS

See Exhibit E regarding Claims.

Bank Debt and Project Financing· Lone Oak — see Schedule D-1· Trinity — see Schedule D-2· Feather Bay — see Schedule D-3· Dunrich — see Schedule D-4

All debts and obligations incurred within the acquired entities in the ordinary course of business since December 31, 2007.

Termination of Employees. On and about February 9, 2007, Purchaser terminated several employees and managers of the various entities. Purchaser shall be liable for any damages or losses resulting solely from an alleged lack of authority by Purchaser to terminate said employees, including without limitations, payments and obligations due to such employees as set forth on this Exhibit D.

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Exhibit D 2

Accounts Payable and Credit Card DebtAs of December 31, 2007 — Before Final Closing

SUMMARY OF AGED ACCOUNTS PAYABLE

Lone OakCurrent 1 to 30 31 to 60 61 to 90 Over 90 Credits Total

Due CMO Management a 1,373 3,860 5,836 10,889Developer Finance Corp 11,270 9.993 400 21,663Feather Bay a 1,221 1,221Hunt County - Real Property Taxes 63.202 38 83,240Cash Special Utility District 60,000 60,000

AR other vendors74,934 254,341 136,709 233,582 187,460 (10,652) 856.373

Total Loan Oak Aging Report - 12/31//07 158,136 265,649 138.082 248,455 233,696 (10.852) 1,033,366

TrinityDeveloper Finance Corp b 4,961 4.704 9.655Lone Oak a 240 922 1.162Trinity/Groveton Tax Office - Real Property Taxes 29.762 899 30.851Trinity County Tax Office - Real Property Taxes 13.836 29 13,866All other vendors 45,839 151.299 16.922 13,330 153,100 (1) 380.489

Total Trinity Aging Report - 12/31/07 94.398 156.003 17.850 13.570 154,022 (11 436,843

Feather BayBrown County - Real Property Taxes 41,330 - - 41.330Lone Oak a - 2,194 17,500 19.694All other vendors 18,520 76,828 20,494 80.242 337,550 (19.269) 514,365

Total Feather Bay Aging Report - 12/31/07 59,850 76,826 20.494 B0,242 339.744 (1,769 575,390

DunrichTrinity a 4,620 4,620Walker County Appraisal - Real Property Taxes c 46,575 46,575

All other vendors 4.982 937 1,050 300 7,751 15,020

Total ()mach Aging Report - 12/31/07 51.557 5.557 1,050 300 7,751 66.215

HUI Enterprises, Inc.Walker County Appraisal - Taxes (estimate) 6.000 6.000

All other vendors 9.000 9,000

HUI Estimated total as of 12/31/07 15.000 15.000

CMD Management, inc.Credit Cards

Advanta 925 1,005 1,404 2.367 23,062 28,753American Express - Gold 564 672 1.141 9.250 - 11,626American Express - Silver 5,000 - - - 5.000American Express - Stanwood Preferred 266 392 1,420 503 9,315 11,896Capital One Bank (0) 1,795 3.250 5.045Capital One F.S.S. 9,445 315 384 1.590 705 12,439Home Depot Credit Services 839 426 1,092 371 914 3.642Office DepolCredit Plan 2,355 688 - - - 3.043VISA - United - Chase Card Services 3,010 8,428 2.113 7,158 2,250 22.958VISA - United - Cardmember Services 1.744 1.224 993 1,733 16.340 _ 22,034

Total Credit Cards 24,148 14,944 8.547 26.222 52,586 126,446Rossmoor Group LP e - 51,975 51,975CityVVide Bank - P/R Tax Deposits 55,784 55,784CO Dept of Revenue - State Unemployment 2,083 2.083

All Other Vendors 54,425 23.027 8,762 1,639 12.469 100.321

Total - CMD Management Aging Report - 12/31/07 136,439 37.970 17,309 27.861 117.030 336.609

a Inter-entity payable eliminates in combination.b Debt reflected in Schedule D at balance per Lender - Payments entered 10 AP, but not yet paid do not reduce balance per

lender, so liability is duplicated.c Real property taxes due are shown In financial statements provided to Purchaser as a separate accrued liability. not part of the AP

ball:melt shown In those financial statements.it Cash Special Utility District will not start wont on water storage facility until ihio $60,000 is paid. Payable is not for wad: already done.e Represents unpaid amounts due Jerry Dunn for rental of condominium and tight-to-use cabin to DUndett (also allocated to Trinity & Lone Oak)

See attached detailed Accounts Payable Aging Reports for each entity as of December 31, 2007

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Exhibit D 3

Indebtedness disclosed herein shall also include all accounts payable incurred in the ordinary course of business since December 31, 2007, even though not specifically identified in this Exhibit D.Credit Card indebtedness — CMD Management has used various credit cards to pay expenses and defer cash expenditures. Credit card charges are entered to Accounts Payable when the applicable statements are received. Consequently, some charges incurred in 2007 may not be entered to Accounts Payable until January 2008, but are nevertheless expenses entered into in the ordinary course of business that are disclosed herein. At Closing, Seller will surrender to Purchaser all credit cards that are in the name of the Entities. Forpersonal credit cards in the name of Jerry and/or Charleen Dunn, Seller acknowledges responsibility for any future charges that are personal expenses of

Seller and agrees to cease use of these cards for paying expenses of the Entities.

Purchaser is hereby notified that certain vendor arrangements provide for automatic monthly charges to existing credit cards and Purchaser will need to terminate these arrangements or provide those vendors with a new credit card number.Accrued LiabilitiesAccrued payroll — Sales Commissions are accrued in the same month the related sales are recognized. A portion of sales commissions are held back (generally1.0% of the sales price) and either used as a reserve against commission charge-backs or paid out at the end of each year. The policy for commission charge-backs has generally been that charge-backs are made only if the buyer defaults before making at least four payments on the related land note.

Salaries and wages payrolls — Salaried and hourly employees are paid every two weeks. Compensation expense is recognized on a cash basis as paid and no accruals have been made for pro-rata payroll cost related to payroll periods that over-lap the end of any reporting period.

Payroll taxes and withholdings — These liabilities are recognized as payrolls are paid. No accrual is made for pro-rata employer taxes applicable to payroll periods that over-lap the end of any reporting period.

Accrued Bonuses — See discussion regarding unpaid bonuses to certain employees as set forth in this Exhibit D.

Vacation and Sick Day — No accruals are made for paid time not worked. Hourlyemployees are paid for sick leave only if they choose to use earned vacation

days. Vacation pay is expensed as paid. Earned vacation not taken is paid to terminating employees. The policy for Denver office employees is: during 90 day probation period - 0 days; after probation through 2 years service 7 10 days; from

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Exhibit D 4

2 to 7 years service 15 days; 7 years or more — 20 days. Vacation and sick leave policies do not apply to commissioned sales personnel or part-time (less than 38-40 hours per week) employees. Policies for vacation for safes office administrative personnel have not been formalized.Customer deposits — Any amounts received from customers before the month in which the sale is recognized are reflected as a liability for customer deposits until the sale is recognized or the deposit is refunded because orcancellation.

As of December 31, 2007, Lone Oak customer deposits includes an amount of$88,237.50 that relates to an arrangement with Land Excavation (a vendor) under which payment of a portion of Land Excavation billings to Lone Oak were deferred and are to be applied toward the purchase of a lot at Lone Oak.Accrued interest payable — Interest expense, whether capitalized or charged directly against income, is recognized monthly on an accrual basis. See separate disclosure of Debt at Schedule D-1, D-2, D-3, and D-4. Interest has been recognized based on the rates provided for in the applicable-debt agreements and no discounts have been recorded and amortized with respect tonon-interest bearing debt obligations or below-market rate debt obligations.

Accrued Real Property Taxes — Real property taxes for 2007 are included in accounts payable of each entity as of December 31, 2007. Generally, real property taxes are not pro-rated at the time of lot closings. However, exceptions are made for buyers who resist that contract provision. In addition, the title companies used have generally pro-rated and paid property taxes late in the year after the assessments have been made by the taxing authorities.

In February 2008, Seller was advised by the Hunt County Tax assessor's officethat "roll-back" taxes had been assessed on Lone Oak acreage dating back to 2002 and not previously accrued by Lone Oak. The total thus far assessed is approximately $36,000. It is possible that additional "roll-back" taxes may be assessed on property owned or sold by the entities that may be the responsibility of the entities.

Personal Property Taxes — The entities are subject to personal property taxes in most jurisdictions, including Arapahoe County, Co. Renditions for the 2007 tax year are due by April 15, 2008. No accrual has been made for personal property taxes applicable to 2007.

Texas State Franchise Taxes Payable - Prior to January 1, 2007, Texas limitedpartnerships were exempt from Texas state franchise taxes. New legislation

during 2006 revised the existing franchise tax to create a new tax on virtually all Texas businesses, including limited partnerships. The changes are effective for franchise tax reports originally due on or after January 1, 2008, meaning the taxwill be imposed on the entities effective January 1, 2007. The Seller has been

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Exhibit D 5

notified that the revised tax base will be the taxable entity's "margin." Taxable "margin" is to be the least of three Calculations: total revenue minus cost of goods sold; total revenue minus compensation; or total revenue times 70%. However, the rules further provide that all members of an affiliated group engaged in a unitary business must file a combined report and "margin" must be determined the same way for all members. "Margin" is also mechanically defined to include interest income, but the current rules do not appear to 'allow a deduction for related interest expense, except for financial institutions. The tax rate is 1.0%. Taxes are due by May 15 of each year beginning May 15, 2008. Rules for implementation of the new tax continue to evolve, but estimated provisions for franchise taxes applicable to 2007 are as follows:

Lone Oak $ 70,245 _Trinity 50,827Feather Bay 53,498Dunrich 8,197HUI Enterprises ??

Total $182,767

Obligation to Bob Lilly — Former Dallas Cowboys player Bob Lilly was engaged by Lone Oak to endorse and help promote the project. Part of his compensation for doing includes conveyance to him of title to Lot 53, the Vineyards. The legal transfer of title has not been made as of February 19, 2008, but is nevertheless an obligation of Lone Oak.

Swann & Partners — Dunrich Accounts Payable includes approximately $8,000 payable to Swann & Partners related to a launch at Wildwood Shores in April 2007. On February 21, 2008, an e-mail was received from Swann & Partners requesting proof that a drawing and award of a giveaway prize advertised for the Wildwood Shores Closeout event actually took place. The prize was to be a trip to Lake Tahoe and no such drawing took place.

Dunrich December lot Sale — In December 2007, Lot 22, Section 11 was sold to John and Mary Gentempo for $118,000. In February 2008, it was discoveredthat an error was made in the legal description because the lot represented to the buyer was Lot 22 from the original plat. Section 11 had been re-platted because the actual shore line differed from the original plat. The re-platted lot 22 is smaller and less of a premium lot than the originally platted lot 22. Settlement with this_ buyer may require a price reduction, full refund of the purchase price, or trade to a better lot. The re-plat includes the same total number of lots in Section 11 as the original plat, but the configuration differs for some of those lots. About one-half of the lots in Section 11 have been sold, the majority of which sales occurred after the re-plat. Because the lots were numbered the same as the original plat, the HUD Report was not amended. All of the sales made after July 19, 2005, have been covered by title insurance which refers to the correct re-plat map and which should guarantee title to the correct lot. Seller recommends that

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Exhibit D 6

the HUD Property Report be amended before any further sales are made from Section 11 to avoid any further confusion.

2007 Invoices Received in 2008 — The Accounts Payable detail as of December 31, 2007, includes only invoices received and entered to Accounts Payable as of the date these reports were produced. Additional invoices received and entered after that date include:

Lone Oak — Lyle S. Hosod a & Associates $3,628.91

Promotional Sales Offer — In November and December 2007, a promotional sales offer was made whereby buyers were promised that the projects would reimburse the first three payments due on their land notes. In effect, the notes signed by the buyers were "interest-free" for 90 days; however, terms were that the buyers were required to make the payments, then submit coupons to the sellers for reimbursement. Sales made under this promotion are summarized below:

No. of SalesAggregate Monthly

Payments X 3Total Cost of

PromotionLone Oak 6 $3,407.56 X 3 $10,222.68Trinity 17 6,506.87 X 3 19,520.61Feather Bay 3 1,678.14 X 3 5,034.42

$11,592.57 $34,777.71

Buyers Delinquent on Property Taxes — Land notes receivable are secured by a first deed of trust on the lot(s) sold. Buyers are responsible for payment of real property taxes from the date of closing. If buyers fail to pay property taxes, the taxing authority will file a suit against the lot owner and place a tax lien on the property, which claim is, by statute, superior to the seller's first deed of trust. As holder of the first deed of trust, the seller is also served with the plaintiffs complaint. Outside counsel (usually Armbrust & Brown) is used to pursue buyers who are delinquent in paying property taxes on land that is collateral for notes held by the Entities. One resolution is for the seller to receive assurance that the delinquent taxes have been paid by the buyer and the tax lien has beenremoved. Another type of resolution is for the seller to pay the taxes and add the amount paid to the principal balance of the land note receivable through a "modification of terms."

Deeds of Trust for notes receivable sold to DFC or Merchants Mortgage & Trust ("MMTC") are assigned to DFC or MMTC. However, notes are sold with recourse if the obligors default, so similar issues could arise with respect to defaulted notes that the entities are required to repurchase from DFC or MMTC

The status of tax suits in process at December 31, 2007, are described in Schedule E-1.

9,05

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E x h i b i t D 7

Debts/Obl igations to Jerry Dunn and/or Family Members

· Commitment to remarket lot 7, phase 2, the Vineyards that was sold toLaird Blue and Stephanie Dunn (Jerry Dunn's son-in-law and daughter) in

December 2004 for $70,000, funds from which were used to settle a pre-existing note due to Daniel P. Davison.

· Short-term loan of $142,306 from Shelby Company, a partnership in which Jerry Dunn has an interest, was advanced to Trinity County Land L.P. in October 2007 and repaid in full, without interest, in January 2008.

· Unpaid Management Fees due Jerry Dunn from Lone Oak and Dunrich will become receivables of Purchaser. Management Fees due Jerry Dunn from Trinity were retroactively eliminated.

· Unpaid Loan Guaranty Fees due Jerry Dunn from Lone Oak will become receivables of Purchaser. Loan Guaranty Fees due Jerry Dunn from Trinity were retroactively eliminated.

· Loans/Advances to Lone Oak and Trinity by Jerry Dunn and/or his affiliates will become receivables of Purchaser (see Tentative and Preliminary Combined Financial Statements of Jerry Dunn's Major Real Estate Holdings as of December 31, 2007).

· Interest on Loans to Lone Oak by Jerry Dunn and/or his affiliates will become payable to Purchaser upon closing. Interest on Advances to Trinity by Jerry Dunn was retroactively eliminated.

Purchased Notes ReceivableDFC has purchased Notes Receivable from Lone Oak, Trinity, and Feather Bay, with recourse to those Partnerships if the obligors default on the purchased notes, meaning DFC will require those Partnerships to repurchase the notes at their defaulted face value, including unpaid interest through the date of repurchase. Merchants Mortgage & Trust (MMTC) has similarly purchased Notes Receivable from Dunrich and has similar recourse to require Dunrich to repurchase defaulted notes. Uncollected principal of purchased notes as of January 9, 2008, per records provided by DFC and MMTC were as follows:

Current15-29 30-59 60-89 90-119 120+

Total

Lone Oak

6,959,795225,284163,709

33,850

Trinity

FeatherBay

2,725,345 25,977 101,886

Dunrich Total

7,382,638 5,440,185 2,853,208 8,126,274 23,802,305

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Exhibit D 8

Foreclosures — Installment notes originated by the Projects are secured by a Deed of Trust on each lot sold. If a buyer defaults on note payments and fails to cure the default, the Projects will first attempt to persuade the buyer to surrender the deed and return ownership of the lot to the Project. If that is unsuccessful, the Projects may initiate foreclosure procedures and regain title to the lot. Upon completion of a foreclosure (or surrender of deed), the uncollected balance of the installment note receivable (and, if applicable, any related construction fee or entitlement note receivable) is reflected as a direct reduction of gross sales. The original cost of the recovered lot is added back to land/lot inventory and cost of sales is credited. Legal and other costs related to the foreclosure are expensed. When the recovered lot is resold, that transaction is recorded the same as other first-time sales. Generally, no allowances for uncollectible notes or interest are made in the financial statements of the Projects prior to recognition of cancelled sales.

NOTE: "In-house" land notes arise either because DFC declined funding (usually, because of low credit score) or DFC has required the project to "buy-back" notes they have hypothecated or purchased because of default by the obligors. When a note is returned by DFC, efforts are made to work with the obligor to resume payments. If those efforts fail, the obligor is either required to surrender the deed or foreclosure proceedings are initiated. At December 31, 2007, the aggregate principal amount of in-house land notes that were in default and foreclosures or surrender of deeds were pending was approximately $410,000.

Project Amenities and Golf Memberships

· Lone Oak - Proposed project amenities to be completed by Lone Oak Land Development Company, L.P. include an 18-hole golf course and club house facility. Lot buyers are currently being granted either social or golf club memberships as lots are sold. No fees of any type may be charged or collected until amenities are completed and available for use.

· Trinity - Proposed project amenities to be completed by Trinity County Land Development, L.P. include enhancements to an existing 9-hole golf course, club house facility, swimming pool, and tennis courts. A proposed boat dock or marina has also been discussed at sales presentations. The golf course and other amenities are owned by the Partnership. Lot buyers are currently being granted either social or golf club memberships as lots are sold, but no dues or other member fees are currently being assessed. Operation of the golf course is currently under contract to a third party (Kenneth Ruecker) and the accompanying financial statements reflect no revenues related to golf operations. Payments to Mr. Ruecker are $2,000 per month through payroll and he retains all receipts for green fees, tournaments, etc.

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Exhibit D 9

· Feather Bay - The golf course and other amenities are owned by the Partnership. Lot buyers are currently being granted either social or golf club memberships as lots are sold, but no dues or other member fees are currently being assessed. FB Hospitality, Inc., a Texas Domestic Nonprofit Corporation, was formed in April 2007 to organize and create a private club to perform social, fraternal and hospitality services within the meaning of the Texas Alcoholic Beverage Code. FB Hospitality applied for and was issued a permit for the sale of alcoholic beverages on the premises. FB Golf Club, L.L.C. was formed in March 2007 to operate the golf course and club facilities. The L.L.C. leases the golf course and facilities from the Partnership, for rental payments equivalent to the L.L.C.'s net receipts, and sub-leases the club to FB Hospitality. Improvements to the amenities and all costs of operating them are the responsibility of the Partnership.

· Dunrich - Amenities are completed and include two swimming pools, a pavilion, outdoor recreational facilities and boat docks. The amenities are to be transferred to the Property Owners Association at or near sell-out of the project

Proposed Sale of Dunrich Cabins — Dunrich has engaged in negotiations for the sale of all remaining cabins at Wildwood Shores. Tentative terms would require the buyer to assume all future responsibilities with respect to those cabins. There is no assurance this transaction or any transaction for the sale of these assets will be consummated.

· During 2005, Dunrich authorized Trinity to bundle an interval with the sale of a lot at Trinity's development. The strategy was designed to create a greater number of interval owners necessary to fully fund on-going operating costs through interval association assessments. This program was subsequently suspended.

· Four cabins (and associated lots) are dedicated to the Lake Conroe Club program. As a sales incentive, "members" of this "club" were promised an annual free week's stay in one of these cabins. These commitments will not be substantially fulfilled before late 2009.

· Six cabins dedicated to the time share interval program. If the sale of cabins described above does not occur, the ability of Dunrich to dissolve this program and dispose of the related assets without incurring significant additional expense is presently uncertain.

MB Wastewater Services, L.L.C. —On June 4, 2004, Mathews Bluff Ltd. sold 100% of the membership interests of MB Wastewater Services, L.L.C. (MBWS), a water and sewer treatment company formed to serve residents of the Villages at Lone Oak development, to Jerry R. Dunn and Richard C. Jennings. MBWSheld a discharge permit for disposal of effluent into Lake Tawakoni. The purchase price was $250,000, paid with an initial cash payment of $62,500 from

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Exhibit D 10

Jerry Dunn and a promissory note for $187,500. The member interests in MBWS purchased were pledged as collateral for the note. In December 2004, the initial installment on the note of $62,500 was paid by MBWS with funds provided by Jerry Dunn.

In 2005, the Messrs. Dunn and Jennings became aware that MBWS did not possess the authority to provide wastewater services and collect fees from lot owners as represented by the sellers. Consequently, the buyers initiated an application to the Texas Commission on Environmental Quality in order to obtaina Certificate of Convenience and Necessity ("CCN"). A CCN was issued to MBWS during 2007. However, MBWS does not yet have an approved tariff and cannot bill present residents for wastewater hauling services until the tariff is in place. Lone Oak continues to be committed to construction of permanent water and sewer treatment facilities and lines for the project that are a part of land and development costs allocated to lots.

The parties to the agreement negotiated a settlement during 2007 to reduce the total purchase price to $167,500. Jerry Dunn paid $5,000 in December 2007 on behalf of MBWS, and MBWS is to pay the remaining $37,500 in installments of $5,000 each in January through June, 2008, and a final payment of $7,500 in July 2008. While the Membership Interest Purchase

Agreement provided for the seller to sell 75% of the membership interests to Jerry Dunn and 25% to Rich Jennings, all.funding of payments to the seller has been provided by Jerry Dunn. Mr. Jennings has paid no portion of the amounts due the seller and may be required to pay a proportionate share in order to retain his interest. If Mr. Dunn obtains ownership of Mr. Jennings interest because of this arrangement, he agrees to assign that interest to Purchaser at no additional cost to Purchaser.

Other than the CCN, the cost of which was paid by the Lone Oak, and the discharge permit, the only asset of MBWS is a bank account with CityWide Banks that has a balance of $9,100, including $8,600 collected from Mr. Garrett Boone, a resident of the Rocky Ford subdivision and $500 deposited by Mr. Dunn. Temporary waste water collection facilities were constructed' by the predecessor and are being used to serve existing residents. Waste watercollected must be hauled away, the cost of which is borne by Lone Oak. Lone

Oak is also responsible for the cost of waste water collection lines and treatmentplants. These assets will eventually be transferred from Lone Oak to MBWS. This cash account and the remaining $37,500 payable to Mathews Bluff Ltd arereflected in financial statements furnished to the Purchaser and will transfer to Purchaser at closing through purchase of the stock of MBWS. Sewer service to the limited number of present residents has been provided by temporary facilitiesand the cost of hauling away accumulated wastewater has been borne by the Partnership. Authorized utility districts may charge lot owners usage fees only after they connect to the system. MBWS expects to engage a third-party service company to manage the day-to-day operations of the utility district for a fee. It is

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Exhibit D 11

currently expected that wastewater and sewer charges will principally be assessed at a level monthly rate to each connected lot.HUI Enterprises, Inc. - HUI is an investor-owned utility providing water and

sanitary sewer/wastewater collection services to the Wildwood Shores and Sam Houston Forest Estates subdivisions in Walker County, Texas. HUI is a Texas "C" Corporation originally formed in 1977. HUI is authorized to issue 5,000,000 shares of $1 par value common stock, of which 180,000 shares are issued and outstanding. Those shares were acquired effective April 11, 2001, by Dunrich from Suntex Fuller Corporation and Wilderness Resorts, Inc. as part of the purchase by Dunrich of real and personal property comprising the Wildwood Shores development.HUI has an Operating Services Agreement with John C Hudson and Company,

Inc. ("Hudson") for the operation, maintenance and management of its water and sewer systems. The current Agreement was updated effective January 1, 2005, and supersedes all previous agreements with Hudson. The original term of the updated agreement was one year, provided that it shall continue thereafter from year to year, subject to termination by either party upon thirty days advance written notice. Hudson is responsible for the operation and maintenance of the systems and provides all tools, equipment, vehicles and employees necessary for the efficient distribution of water and collection of wastewater within the service area. The Company is responsible for the cost of all materials and labor related to repairs and replacements. Hudson also provides all customer billing and collection, including meter reading, supplies and labor. Compensation to Hudson includes a monthly fee of $1,500, billing and collection fees based on the number of accounts serviced, and fees for repairs, installations and service calls based on time and materials or fixed rates included in the Agreement.

Standby Fees are billable to Wildwood Shores lot owners, other than the Developer, beginning when service is available. Final construction of water distribution and wastewater collection lines was completed in 2006 and service is currently available to all Wildwood Shores lots.Standby Fees arebilled under the authority of Article IX of the Declarations of Covenants, Conditions and Restrictions of the Wildwood Shores Subdivision (for at least some sections of Wildwood Shores) which provide that such charges are secured by a lien created on each individual lot which may be foreclosed upon, after written notice of delinquency to the lot owner, in the same manner as provided for non-judicial foreclosure of a mortgage upon real property under Texas state laws. The imposition of standby fees was disclosed to all Wildwood Shores lot buyers in the HUD report furnished to them.

Standby fees charged are $10 per month for water and $10 per month for sewer and are billed quarterly. Standby fees are not billable to lot owners in Sam Houston Forest Estates.

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Exhibit D 12

At the closing in April 2001, Suntex-Fuller provided Dunrich a list of 55 sold lots that had been promised "free" grinder pumps at the time they connected to the wastewater system. It is presently unknown how many of these lots may still be entitled to receive that benefit from HUI.Accrued Future Development Costs - As lots are sold, cost of sales is recognized based on the relative sales value of each lot to the projected revenues for the entire project. Costs so allocated include the original acquisition cost of the land, engineering, surveying, planning and permitting, all direct costs of excavating, costs of roads, developer-provided utilities, golf courses, all other amenities and capitalized interest. The charge to cost of sales for each lot sold effectively consists of an allocated portion of all costs incurred and an accrual for an allocated portion of all costs not yet expended.

At December 31, 2007, accruals recognized for estimated future development costs related to lots sold through that date were approximately:

Lone Oak $6,071,000Trinity 1,699,000Feather Bay 1,689,000

Total $9,459 .000

Budgeted Development Costs

Except for Dunrich, development work on all projects is behind schedule and the various entities have received inquiries and complaints regarding the delay. The Projects have sold lots that are undeveloped or for which development work is only partially complete. Purchaser will be assuming responsibility for completing all such development work, including but not limited to required infrastructure, roads and utilities required for lots and acreage being acquired as well as lots already sold.

Lone Oak — A detailed report of Estimated Remaining Development Costs on April 1, 2007, prepared by James Powell, has been provided to Purchaser. That report identifies all major expenditures of which Seller is aware.

Trinity — A master plan for this project has never been finalized. Platting has occurred section by section and development costs included in Trinity's financial projections are approximately $10,000 per lot.

Each developed lot at Trinity is to have access to water supplied by Trinity Rural Water Supply Corp. ("TRWS"), an unrelated entity. As developer, Trinity is required to install all water lines and a water storage facility, the cost of which will be included in Trinity's land development costs. In addition, TRWS is requiring the developer to pay a "parity fee" of $650 per lot that will also be included in

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Exhibit D 13

development costs. Parity fees have been paid to TRWS in installments that are currently in arrears. Approximately $76,000 due TRWS was included in Trinity's accounts payable at December 31, 2007. TRWS is due approximately $65,000 for engineering and design of the water storage facility. The estimated cost to construct the water storage facility is approximately $170,000.

TRWS has agreed to refund parity fees applicable to 99 lots in Section 3 of the project, but only at such times as each lot owner constructs a residence on the lot and obtains residential service from TRWS.

Feather Bay — An estimated Development Budget was prepared by James Powell in August 2007 and has been provided to Purchaser. That report did not consider the acreage purchased from David Pruitt in December 2007. All items set forth in such budget need to be completed by Feather Bay Land Development Company, L.P.

Dunrich has a remaining budget of approximately $190,000 for construction of awater storage facility, funding for which has been approved by Merchants Mortgage and Trust. The storage facility will be an asset of HUI Enterprises. Ongoing maintenance at Wildwood Shores may be required by Dunrich.

Leased Property

CMD Management office space — Colorado — 6000 Greenwood Plaza Blvd., Greenwood Village, CO, Suite 120. The lease was renewed effective June 1, 2007 for 60 months. Base rent is:

Period Per Sq Ft Annual Total Monthly rent6/1/07 — 5/31/08 $17.00 $118,116 $9,843.006/1/08 — 5/31/09 $17.75 123,327 10,277.256/1/09 — 5/31/10 $18.50 128,538 10,711.506/1/10 — 5/31/11 $19.25 133,749 11,145.756/1/11 — 5/31/12 $20.00 138.960 11,580.00

Additional rent may be due for tenant's pro rata share of "excess operating costs" based on increased common area maintenance costs using 2007 as the base year.

If Tenant is purchased and all of Tenant's operations are relocated outside of Colorado, Tenant has the right to terminate the lease, with six months prior notice, only as of the last day of the 36th month of the extension term (i.e., May 31, 2010). Upon early cancellation, tenant must also pay Landlord the unamortized portion of Landlord's transaction costs (tenant improvements and broker's commission paid). Estimate of unamortized transaction costs at end of month 36 is approximately $17,500.

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Exhibit D 14

CMD Management— Houston Call Center—Suite 175,16903 Red Oak, Houston, TX 77090

· Lessor— 16903 Red Oak, L.P.n Lessee is Dunrich Holding Company, L.P. (but expense is paid by CMD

Management and allocated to all projects)· Original Lease dated November 1, 2003· Basic rent - $3,718.13 per month; Security deposit for one month's rent.n Term of Original lease — month to month· Term of First Amendment to lease — November 1, 2006 to October 31,

2008.· Rent for 1st year of new term - $3,342.71 ($3,718.13 less $275.42 tenant

improvement allowance)· Rent for 2" year of new term - $3,878.24 ($3,718.13 plus 160.11 CPI

adjustment)n Electricity separately metered and billed to tenant.

Suite 272, 16903 Red Oak. Houston, TX · Lessor — 16903 Red Oak, L.P.· Lessee is Dunrich Holding Company, L.P. (but expense is paid by CMD

Management and allocated to all projects)· Lease is dated November 1, 2006· Basic rent - $840.00 per month, no security deposit requiredn Term is month to month

CMD Management— Conroe Call CenterSuite 1101110 N. Loop 336 West, Conroe, TX 77301 [2,206 gross sq ft]

· Lessor— Originally, C.Rhodes d/b/a Texas Tower; now 2 Jessamine Place Partnership

n Lessee is Dunrich Holding Company, L.P. (but expense is paid by CMD Management and allocated to all projects)

· Minimum rent - $2,426.60 per month, plus one month security deposit.n Term — February 1, 2006 through January 31, 2008n Holding Over/Month to Month Tenancy - rent to be 150% of monthly lease

rate ($3,639.90)n Lessor has proposed one-year renewal of lease at $3,100.00 per month

not signed by Lessee

Lone Oak House LeaseHouse at 106 W. Cedar, Lone Oak, Texas has been leased by Lone Oak since September 2004 from Jerry Kirchman. Rent is $950 per month. Property is used as temporary housing for Lone Oak sales personnel.

Modular Office SpaceOn-site sales office facilities leased from GE Capital by Lone Oak and FeatherBay.

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Exhibit D 15

· Lone Oak rent is $3,415.28 per month. Each of three separate leases have a minimum term of 24 months, which minimum requirement has been satisfied as of January 31, 2008.

· Feather Bay rent is $7,967.77 per month on a 4-year lease.· [Trinity sales office is the renovated club-house. Dunrich remaining on-

site facility is one of the existing cabins. Modular units at Dunrich were torn down and lease terminated in 2007.]

The leases also provide for set-up charges (already paid) and tear-down/return charges.December 2005 fire destroyed seven modular units at Lone Oak for which Lone

Oak was only partially insured. While settlement was reached with GE Capital, there was a mix-up on the part of GE Capital and the settlement only listed six units. In addition, GE Capital continued to bill rent on the destroyed units, some of which was erroneously paid. The last correspondence with GE Capital regarding this matter was in November 2006 and GE Capital has not asserted any additional claims.

Mews Cottage Arrangement — As part of the closing for the purchase of Lone Oak assets in June 2004, Lone Oak agreed to continue an arrangement related to an existing house on the property. The owner of record is an architect named Rodney Austin. He designed the house and borrowed money for its construction. Mathews Bluff Ltd. had agreed to pay all costs related to the house, including mortgage payments, taxes and maintenance because they believed the house would help stimulate lot sales. The house has been used intermittently as temporary housing for sales personnel or Robert Jordy. The appraised value of the property may be less than the amount owed on the related mortgages. Aggregate monthly payments of $1,971.91 are made to Wells Fargo on three separate loans for which Rodney Austin is the legal obligor.

Water LeasesLone Oak — Short-Term Water Supply Contract with Sabine River Authority of Texas for use of water from Lake Tawakoni to water the golf course. Paragraph 4. of Recitals states "Although the Seller's long-term commitments of water from the Lake Fork and Lake Tawakoni Reservoirs (...the "Project") will require the full yield of the Project, water is available from the Project on a short-term basis." Effective date of Contract is June 1, 2005. Term is until December 31, 2013. Maximum annual quantity is 125 million gallons. Charge for water includes a monthly base rate of $1,041.66. An additional "conservation rate" from $0.02 to $0.10 per thousand gallons is due for water actually diverted by Lone Oak.[Note: The long-term plan for watering the Lone Oak golf course includes use of effluent from the waste water treatment plants to be constructed.]

Feather Bay — Feather Bay Partners, Ltd ("FBP") Untreated Water Supply Contract. Contract with predecessor partnership dated June 1, 1999, has been

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Exhibit D 16

honored by Brown County Water Improvement District No. One. FBP is obligated to purchase not less than 50 million gallons, and not more than 125 million gallons of untreated water per year, pumped from Lake Brownwood. Term of the contract is five years with a five year renewal option (i.e., through June 1, 2009). Rate per 1,000 gallons is determined by the contract and was $.07 per 1,000 gallons for 2007 for water used on the golf course.

Equipment Leases — CMD Management

I Lessor Description Monthly Maturity Purch optionFirst Bank of Conroe

Truck used by Homer/title held by Robert Jordy

$391.90 + $80.83 for Insur.

7/02/09

De Laga Landen Copier -4511 and fax machine

$329.68 10 paymts left.

FMV

De Laga Landen Copier - 4510 $274.81 36 mo. FMVPitney Bowes - Denver

Postage machine $100.84/ quarter

Pd til3/20/08

n/a

GMAC 2005 Chev Silverado, driven by R. Jordy

$1,307.40 Aug 2008

Inter-Tel Leasing TelephoneEquipment lease Conroe office

$940.00 Feb 2009 none

Pitney Bowes - Conroe

Postage machine $97.00/quarter

Pd til n/a

Equipment Leases — Lone OakLessor Description Monthly Maturity Purch optionWells Fargo Turf equipment $762.12 5/20/08 $1Wells Fargo Turf equipment 1,376.51 8/20/08 $1Wells Fargo Top dresser 263.00 8/20/10 $1Wells Fargo Turf equipment 449.62 4/20/09 . $1Wells Fargo Turf equipment 751.03 8/20/09 $1VGM Financial Mower 514.73 9/18/10 $1Textron Financial (2) 6-passenger

touring carts334.43 12/15/09

Equipment Leases — Feather BayLessor Description Monthly Maturity Purch optionTextron Financial 25 used EZ-Go carts $1,121.50 2/15/10 Fair mktWells Fargo Tractor & cutter 836.96 2/20/12 $1Wells Fargo Turf equipment 2855.51 2/20/10 $1Wells Fargo Turf equipment 811.47 3/20/10 $1Cool Time Refrig Ice machine 102.84 Mo to Mo $1

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 40 of 74

••n

Exhibit D 17

All leases are accounted for in Seller's financial statements as operating leases and rental payments are expensed as incurred. Generally accepted accounting principles would require most of the equipment leases to be accounted for as capital leases. At lease inception, the present value of all future payments would be set up as an asset and lease liability. Prospectively, the cost of the lease would be reflected as depreciation and interest expense rather than rental expense.

Service Agreements CMD Management

Vendor Description Monthly TermOce Imagistics Maintenance & usage on 2

copiers and fax machine$105.00

Sprint Dial up service for Rich Jennings

$60.00 Expires9/12/08

Cbeyond Base phone lines and block long distance - Denver

$800.00 No contract

Cbeyond Base phone lines and block long distance - Houston

$4,600.00

HughesNet.Com Trinity — internet service $114.01Dex Media Yellow page listing, Dunrich/

main line in Denver$70.00 Expires

11/08?MCI - Conroe Long distance service $1,900 to

$3,200 based on usage

Month to month

Consolidated Communications

Internet access — circuit id — Conroe phone room

$757.75 Month to month

Consolidated Communications

Base phone lines & some long distance - Conroe

$2,600.00 Month to month

TLC Copier maintenance - Conroe $121.00 MonthlyTLC Copier maint. - Houston $235.00 . . Monthly

MonthlySparkletts-Sierra Springs

Bottled water - Houston $80.00

Sparkletts-Sierra Springs

Bottled water - Conroe $50.00 Monthly

Orkin - Houston Pest control $150/qtr.Dahill Industries Copier maint. - Dunrich $112.58USPS P.O. Box - Denver $104.00/year Pd thru 11/08Community Sanitation

Trash service $64.00

Verizon Wireless R. Jordy's cell phone 936- 203-7572

$130.00 unknown

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Exhibit D 18

Related Party Vendors — CORJ Trucking is owned or controlled by Robert Jordy, Project Construction Superintendent. CORJ Trucking performed hauling services for Lone Oak ($44,371.75) and Trinity ($16,970.00) during 2007.

Computer Software — The records of the entities are maintained using BusinessWorks TM

, a product of Sage Software. The license agreement is held in the name of Colorado Mountain Development, Inc., an entity not being sold to Purchaser. The BusinessWorks TM software is used to maintain the records of several other entities owned or controlled by Jerry Dunn and a plan needs to be implemented to provide for the orderly transition of these records from joint use of the software.

QuickBooks TM software is used to maintain records for the POA's and HUI.

Select Software International ("SSI") provided the software used by the entities to create documents for lot closings, including sales contracts, deeds of trust, and disclosure documents. A separate program written by SSI is used to track notes that are serviced "in-house" at the Denver office.

Seller acknowledges that all information and documentation pertaining to the Entities, whether electronic or hard copy, will remain property of the Entities and. be fully accessible by the Purchaser.

Marketing Commitments

National Cinemedia — due $30,480 from Trinity (included in Trinity accounts payable at 12/31/07) for vehicle display in movie theatres during 2007.

Host Communications — Contract with Feather Bay dated 8/15/07 for term through 6/30/08. Description is "Corporate Marketing —Gameday Displays." Total contract is for $50,000, of which $15,000 was paid in September 2007,$13,125 is included in Feather Bay accounts payable at 12/31/07, and $21,875 is due in monthly installments of $4,475 in January through May 2008..

C&L Productions — booth space at Hunting, Fishing and Outdoors Show, Arlington Convention Center, January 10-14, 2008. $1,100 included in accounts payable at 12/31/07.

Dallas Desperados (arena football) — $4,000 for booth space for 8 regular season home games at American Airlines Center in 2008. Contract signed by Lone Oak in 2007, but not included in accounts payable at 12/31/07.

Center Operating Company, L.P./American Airlines Center — 2007/2008 Advertising Sign Agreement requires 4 payments of $41,328.13. Two payments of $41,328.13 are included in Lone Oak accounts payable as of 12/31/07. Remaining two payments are due in 2008.

7,( ul ic4

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Exhibit D 19

Holiday Travel of America — travel certificates and other premiums. Owed approximately $54,900 as of 1/17/2008 statement date, most of which is either included in accounts payable of Lone Oak, Trinity, Feather Bay, or CMD Management as of 12/31/07, or relates to 2008 invoices.

International Sports Properties — 2007/2008 season for University of Houston. $5,000 billed to Trinity and included in accounts payable at 12/31/07.

San Antonio Spurs — 2007-2008 Sponsorship Agreement. $80,000 billable to Feather Bay in $8,000 installments beginning September 2007. $8,000 paid in October 2007, $16,000 included in accounts payable at December 31, 2007, remainder to be accrued and paid in 2008 is $56,000.

Austin Wranglers (arena football) — Amount due from Feather Bay in 2008 for sponsorship agreement dated June 14, 2007, is $3,000.

The Lamar Companies — Lone Oak contract for billboard advertising from 3/1/07 through 2/28/08 requires payments of $394.00 per month.

Landmark Capital Group LLC — an arrangement for off-site prospect generation provides that for Feather Bay lots sold to prospects provided by Landmark, Landmark is to be paid a commission of 25% of the sales price. The total paid to Landmark for 2007 sales was $44,375.

Leighton Pinkham — an agreement for off-site prospect generation provides that for Feather Bay lots sold to "clients" of Leighton Pinkham, Mr. Pinkham is to be paid a commission of 20% of the sales price and 4% of the sale price is to be applied toward the $40,000 purchase price of Lot #35 in the George Baugh subdivision. The total earned by Mr. Pinkham for 2007 sales was $87,144, ofwhich $73,816 has been paid and $13,328 has been deferred toward purchase of the lot. The term of the agreement is from June 15, 2007 through June 15, 2008.

Offsite sales arrangements — For lot buyers who do not physically inspect the property before closing, the closing process requires obtaining an Inspection Affidavit evidencing inspection of the specific lot by a licensed real estateappraiser on behalf of the buyer which must also be signed and accepted by the buyer.

Simon Property Group Malls — Space at 5 different malls (Broadway Square, Longview Mall, North East Mall, Midway Mall, and Irving Mall). From 11/1/07 through 1/15/08. Price is $112,500, all of which is in Lone Oak AP at 12/31/07.

JGI Outdoor Advertising — Trinity agreement for billboard advertising. $895 per month.

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Exhibit D 20

Live Nation Motor Sports, Inc. — CMD Management Sponsorship Agreement dated 11/21/07. 10 events at $2,000 each. $5,000 due on or before 2/21/08, $5,000 before 3/21/08 and $10,000 before 4/21/08). Term is from 11/21/07 through June 29, 2008; date of last event. (Events include USHRA Monster Jams, Supercross and Bull Riders)Silver Leaf — A copy of this "Joint marketing agreement" has been provided to Purchaser. Silver Leaf buys leads obtained by the entities that do not meet the criteria of the projects. CMD Management deposited payments from Silver Leaf in November and December 2007 totaling $33,739.50.Employment agreements and bonus arrangements

Gregg McMurtrie — Chief Operating Officer. Employment Agreement with CMD Management, Inc. dated August 31, 2006. Term is September 1, 2006 to September 1, 2008. Base compensation is $150,000 per annum, plus a bonus paid monthly as a draw and then settled at the end of the year based upon the profitability of all real estate development projects managed by the Company. Bonus calculation methodology to be determined at a later date, but draw to be $5,000 per month and adjusted at the end of the year after final financial statements are available. If Company is sold, provision is made for the buyout of the Agreement or continuance of Employee by new owner. Buyout to be not less than remaining base salary for contract term.

James E. Powell — Director of Project Development. Employment Agreement with CMD Management, Inc. dated April 13, 2007. Term is April 23, 2007 for one year, continued on a yearly basis by written agreement of Company and employee. Base compensation of $190,000 per annum plus eligible toparticipate in a profit sharing plan under consideration by the Company. If Company is sold, provision is made for buyout of the Agreement or continuance of Employee by new owner. If during first twelve months of Agreement, buyout to be remaining base compensation, but not less than 6 months base salary.

Bonuses to employees; list of anticipated bonuses

· Gary Cooper — 2007 Vice President Sales - $75,000 cash bonus earned and unpaid at December 31, 2007.

· Gary Cooper — 2006 Sales Manager for Lone Oak Project — Unpaid cash bonus for 2006 of $64,000, plus interest at 5.0% of approximately $3,265 as of December 31, 2007 Plus, one lot at the Villages at Lone Oak to be transferred to Gary Cooper having a list price of approximately $95,000.

· Ray Bryant — 2007 Sales Manager for Lone Oak Project — Unpaid cash bonus for 2007 of $37,500 as of December 31, 2007.

· Doug Robbins — 2007 Sales Manager for Feather Bay — Unpaid cash bonus for 2007 of $34,500 as of December 31, 2007.

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Exhibit D 21

· Sales personnel compensation plans for 2008 have been deferred, pending closing of the sale of Seller's interests to Purchaser.

· On February 11, 2008, Duane B. ("Duke") Sims made demand on Feather Bay for payment of $11,364.72 which he claims is the amount of commission reserve he was promised on Feather Bay sales for which he acted as "verification loan officer" during 2007. No such claim was included on commission worksheets that were submitted on a timely basis during 2007 and Seller is aware of no written agreement with Mr. Sims in support of his claim except for a letter signed and dated by Gary Cooper on February 11, 2008.

Other Employee Compensation - An excel file titled CMD Mgmt Actual & Projected Results.xls was provided to Purchaser's representative (Jasen Miller) that includes a tab with details of all compensation paid to Denver office personnel for 2007. Another tab includes summary 2007 payroll information for the Houston Call Center, the Conroe Call Center, shared Construction & Development payroll, and shared Marketing Payroll.

Base compensation in effect as of January 1, 2007, for other executives on the CMD Management payroll and not separately listed on the file referenced above:

Gary Cooper Bill Hellweg

James Petre Robert Jordy Richard Jennings

$300,000 per year$312,000 per year, plus 1/2% override paid to National Marketing (owned by Hellweg) on all sales at Lone Oak as part of his employment compensation. $160,000 per year$110,000 per year $240,000 per year

Employee Benefit Programs — Full-time (30+ hours per week) employees are eligible, after 90 days of employment, to participate in group insurance plans for health, dental, vision, life and supplemental. Providers are:

Health — Pacific Care (PPO plan)Dental — United HealthVision — NUALife — New York LifeSupplemental — Aflac (available to CMD Management and Lone Oak employees only)

The employer pays 75% of employee's health insurance premiums during the first two years of service and 100% thereafter, plus (after three years of service) a portion of premiums for dependents that increases to 100% after six years. The cost of all other coverages (i.e., dental, vision, life and supplemental) is the participating employee's responsibility.

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 45 of 74

Exhibit D 22

The policy year renews in March 2008, at which time rates are subject to adjustment.

Property Owners Associat ions —Lone Oak POAs — Effective June 4, 2004, the Partnership assumed control ofRocky Ford Association, Inc., a Texas non-profit corporation formed July 27, 2000. This property owners association (POA) applies to only approximately 75 lots. It was agreed with Mathews Bluff Ltd. that the Rocky Ford lots will form a separate, gated portion of the over-all project. Consequently, the Partnership formed and currently controls The Villages at Lone Oak Property Owners Association, Inc., a Texas non-profit corporation, as the POA for the remaining lots in the project.POA dues and fees collected from lot owners subsequent to June 4, 2004, are held in separate POA bank accounts for the benefit of the POAs. The

Partnership has funded all project maintenance expenses directly. At or near final sell-out of the project, the Partnership expects to surrender control of the POAs to the residents/owners of these communities, after which time the POAs will be responsible for all maintenance. Amounts funded by the Partnership are treated as Partnership expenses and the bank account balances are assets of the POAs, not the Partnership.

In February 2008, approximately $324,000 of POA funds were loaned to the Partnership, some or all of which may remain payable to the POA at the Closing Date.

Federal tax returns for the Lone Oak POA's have not been filed and are delinquent.

Trinity POA — The Partnership replaced the seller as declarant for the propertyowners association (POA) for the development and has effective control of this

Texas non-profit corporation. POA members include all purchasers of lots in the project, including the purchasers of approximately 400 lots previously platted and sold by predecessor developers of the project.

POA dues and fees collected are held in separate POA bank accounts for the benefit of the POA. The Partnership is currently funding a significant portion of project maintenance expenses directly. At or near final sell-out of the project, thePartnership expects to surrender control of the POA to the residents/owners of these communities, after which time the POA will be responsible for all maintenance. Amounts funded by the Partnership are treated as Partnership expenses and the bank account balances are assets of the POA, not the Partnership.

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 46 of 74

Exhibit D 23

Administration of this POA (billing, collections, financial reporting, etc.) is handled by a third-party that was serving the POA in that capacity at the time the Partnership became declarant. Contact person is Linda Pettitt, 1507 Tara Drive TP 18, Trinity, TX 75862; home phone 936-594-3520; cell 936-661-0243; email: [email protected].

POA — Feather Bay— Feather Bay Owners Association, a Texas nonprofit corporation, was formed in 2004. The Partnership replaced the seller as declarant for the property owners association (POA) for the development and has effective control of this Texas non-profit corporation. POA members include all purchasers of lots in the project, including the purchasers of lots previously platted and sold by predecessor developers of the project.POA dues and fees collected are held in separate POA bank accounts for the benefit of the POA. The Partnership is currently funding a significant portion of project maintenance expenses directly. At or near -final sell-out of the project, the Partnership expects to surrender control of the POA to the residents/owners of these communities, after which time the POA will be responsible for all maintenance. Amounts funded by the Partnership are treated as Partnership expenses and the bank account balances are assets of the FDA, not the Partnership.

A Federal tax return for the Feather Bay POA has not been filed for at least 2006 and is delinquent.

Wildwood Shores Property Owners Association — The Partnership assumed control of this non-profit, property owners association ("POA") at the time of closing in 2001. Through December 31, 2005, the Partnership funded all project maintenance and POA administrative expenses directly and deposited all POA dues and fees collected from lot owners into a bank account belonging to the POA. Amounts funded by the Partnership were treated as Partnership expenses. The POA bank account balance (approximately $477,000 at February 14, 2008) is an asset of the POA, not the Partnership, and is not reflected in the historical and projected financial statements of the Partnership.

Effective January 1, 2006, the Partnership began billing the POA for maintenance and administrative costs that are properly the responsibility of thePOA. At or near final sell-out of the project, the Partnership expects to surrender control of the POA to the residents/owners of the Wildwood Shores community.

Wildwood Shores Resort Community, Inc. — The Partnership formed and currently controls this non-profit, interval owners association ("10A") for individuals who bought time share intervals from the Partnership. Through December 31, 2004, the Partnership absorbed all administrative and maintenance expenses related to the time share cabins. Dues and fees collected from lot owners were deposited into an account belonging to the 10A.

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 47 of 74

Exhibit D 24

The cash account balance (at February 14, 2008, approximately $2,100) is an asset of the 10A, not the Partnership.

The Partnership has billed the 10A for administrative and maintenance costs since 2004, that are properly the responsibility of the 10A. However, the General Partner is also considering alternatives for selling the cabins, liquidating the interval ownerships and terminating the 10A. There can be no assurance as to when or whether such liquidation will occur or whether the associated costs are adequately reflected in the projected financial results of the Partnership.

Federal tax returns have not been filed for the Wildwood Shores POA's and are delinquent.

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 48 of 74

Exhibit D 25

Personal Guarantees of Jerry R. Dunn - List all personal guarantees ("Dunn Guarantees"), including DFC

GuaranteedAmount at

Guaranteed Party Description 12/31/07 Comments

LOANSLone Oak

Developer Finance Corp HYPO Line - 9060001 368,754 RCJDeveloper Finance Corp HYPO Line - 9060004 1,399,241 RCJDeveloper Finance Corp HYPO Line - 9060006 770,375 RCJDeveloper Finance Corp A & D Loan - 9060002 418,896 RCJDeveloper Finance Corp A & D Loan - 9060013 Initial draw January 2008, up to RCJ

51,200,000 availableTexas Community Bank Trinity Line of Credit 200,016 Secured by Notes ReceivablePrivate Debt Holders Private Debt 97,473

TrinityDeveloper Finance Corp HYPO Line - 9060003 2,451,411Developer Finance Corp HYPO Line - 9060007Developer Finance Corp A & D Loan - 9060002 502,270

Texas Community Bank Trinity Line of Credit 63,305Texas Community Bank Land Loan 1,170,000Rogers ? 639,350

Feather BayDeveloper Finance Corp Developer Finance Corp Texas Bank of Brownwood

Texas Bank of Brownwood David Pruitt

DunrichMerchants Mtg & Trust

A & D Loan - 9060009 HYPO Line - 9060011 Loan assumed 12/06

Loans assumed 12/07Purchase Money Note

A & D Loan

4,196,066413,547

- Guaranty released for 50% principalpay-down

290,247 Until paid down by 50%.909,753

568,898 Guaranteed amount only $500,000 plus $68,898 and interest thereon added October 2004.

RCJ also guaranteed S68,896,plus inter.

Merchants Mtg & Trust Tax loan to Jerry Dunn 276,000Merchants Mtg & Trust Tax loan to R. Jennings 65,000

Total guaranteed loans 14,163,251

PURCHASED PAPERDeveloper Finance Corp Lone Oak - 9060008 7,382,638 Approx. principal of purchased portfolio - 12131/07Developer Finance Corp Trinity - 9060010 5,440,185 Approx. principal of purchased portfolio - 12/31/07Developer Finance Corp Feather Bay - 90300122,853,208 Approx. principal of purchased portfolio - 12/31/07

Total guaranteed purchased notes 15,676,031

Credit Cards — Jerry R. Dunn is also personally liable for all credit card indebtedness (see Accounts Payable and Credit Card Debt above).

Vendor Liabilities — Jerry Dunn has also guaranteed certain vendor accounts, including in particular, TXI, a vendor used by Feather Bay.

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 49 of 74

Exhibit D 26

Insurance

Insurance policies in effect at December 31, 2007, are summarized below:

('MD tv!mineenien(

Insurrance Carrier lat t in j / Polier Perin4mat

t iap.a%

Employment Practices Cluibb Group of Insurance Co 6804-2798 8/24/07 to E/24/08 $10,425.00Commercial Crime Travelers Casualty &. Surety 104917256 4/10/07 in 4/ I 0/06 $2,846.01)Workers Comp - Texas Texas Mutual 0001145607 6/5/07 to 6/5/08 aWorkers Comp - Colorado

Argonaut Insurance Co WC47695826781

6/5/07 to 6/5/08 55,157 00 aCasualty - Colorado Hartford Casualty Insurance 61S0 A ItS2449 11/15/07 to 11/15/08 51,429.00Contractors Equipment Mid-Comment Casualty Co 040,424E66 11/19/07 to I1/19/06 59,754.00

Dunrich

Auto Mid-Continent Casualty Co O4CA2751524 4/10/07 to 4/10/08 S 12,435.00Fire - Commercial Property

Chubb Group of Insurance Co 7955259901 4/10/07 to 4/10/08 525,500.00General Liability Mid-Continent Casualty Co 040L67007 4/10/07 to 4/10/08 $18,519.00 aUmbrella - Excess Liability

Mid-Continent Casualty Co 04)(5149176 4/10/07 to 4/1CV08 59.5.59.00Directors & Liability Continental Casually Company 0250710543 4/10/07 to 4/10/08 52.550.00License & Permit Bond Hartford Casualty Insurance Cn 61BSBCX9511 12/2/07 to 12/2/08 5100.00

Feather Bav

Auto Mid-Continent Casualty Co 04 CA2753964; 3/15/07 to 3/15/08 S2,112 I 00Commercial Property Scottsdale Insurance Co CPS0833443 2/16/07 to 2/16/08 50,385.68General Liability Evanston Insuance Company CL420401878 2/12/07 to 2/12/08 S10,950.48Contractors Equipment Federal Insuanee Company 45463016 2n2ro7 to 2.1/08 51,000.00

).one OakAuto Mid-Continent Casualty Co 04CA2754107 7/20/07 to 7/20/0S 55,175.00Fire Scottsdale Insurance Co CPS0806033 7/21/07 to 7/21/08 510,528.77General Liability Mid-Continent Casualty Co 04GL6S2051 7/20/07 to 7/20/OS 575,802.00 aUmbrella - Excess Liability

Mid-Continent Casualty Co 04XSI50655 7/20/07 to 7/20/08 523.006.00

Mid-Continent Casualty Co 04CA2757162 8/6/07 to 8/6/OS 5231.00AutoFire Landon American Risk

Special istsLCF2006155 4/28/07 to 428/08 515392.58

General Liability Evantion'Insurance Company CL420401967 4/28/07 to 428/08 57,029.55 a

5260.096.06

unno to 510000 per meant, this audit plot nucht adjustments

far Lone Oak 6: Trinity

on payment plan-55769.13 down 55769.13 per month for 11 !manic total 569.229.56

Wildwood Shores Resort outdoor advents.%

Financed tnrout.th Cananwillpayment plan - 59.794.20 down and 59,794.20 per month (1 I mos) through June 2008.

liability

a - premiums are subject to audit adiustment each year.

APPROXIMATE INSURANCE EXPENSE FOR YEAR ENDED 12/31/07CMD

Management Lone Oak Trinity Feather Bay Dunrich Total

Insurance - Liab. & Comm. S - S 156,723 5 25.865 S 37,935 S 61.575 S 282,098Insurance - Workers Comp. 46,919 81,641 7,857 21,361 903 158.682Insurance - Auto

Subtotal 46,919 238.364 33,723 59,296 62,477 440,779

insurance - Health 46,841 43,154 30,995 40.705 161,694

Insurance - Life 12,021 253 33.209 45,483

93.760 S 293.539 5 64.970 5 133.211 S 62.477 S 647,957

The principal insurance agency used by the entities is John Wortham & Sons. Major insurance claims in the last three years include: (1) a fire that destroyed the Lone Oak sales office in December 2005 (insurance paid $72,409) and (2) damage to equipment that fell into the water at Wildwood Shores (insurance settlement received of approximately $100,000 was paid to Mustang Rentals).

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 50 of 74

E x h i b i t D 2 7

Life Insurance Policies —

Feather Bay — Prudential policy #L8032105 for $3,000,000, insuring the life of Jerry R. Dunn. Policy benefits payable to an irrevocable trust owned by Charleen B. Dunn, but benefits currently assigned to Developer Finance Corporation. DFC to release all rights as assigned beneficiary per Paragraph 13.15 of the Purchase Agreement. Premiums are $8,243.83 for three months —paid through approximately March 28, 2008. Premiums due subsequent to closing will be the responsibility of Jerry R. Dunn.

Lone Oak —Banner Life Insurance policy #17B757896 for $1,000,000, insuring the life of Jerry R. Dunn. Policy benefits payable to an irrevocable trust owned by Charleen B. Dunn, but benefits currently assigned to Developer Finance Corporation. DFC to release all rights as assigned beneficiary per Paragraph 13.15 of the Purchase Agreement. Premiums are $6,030.00 per year — paid through approximately March 28, 2008. Premiums due subsequent to closing will be the responsibility of Jerry R. Dunn.

Lone Oak — The Hartford Life Insurance policy #102 LT1819594 and insuring the life of Richard Craig Jennings. Policy benefits assigned to Developer Finance Corporation. Premiums are $5,670 per annum and renewal premium is due February 24, 2008.

income Taxes

The transactions contemplated by the Agreement will result in technical terminations of the Entities, for income tax purposes only, in accordance with Section 708 of the Internal Revenue Code and the regulations thereunder and the consequences as a result thereof.

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 51 of 74

Schedule D-1

Schedule D-1Bank Debt & Project Financing — Lone Oak

Third-Party DebtNote Payable DFC - HYPO Line

It/9060001JNote Payable DFC - HYPO Line

[#90600041

December 31, 2007

Loan Principal Accrued Interest

368,7541,399,241770,3752.538,370

Note Payable DFC - A&D Loan 418,896Note Payable - Texas Community 200,016Note Payable - Lone Star Land Bank 339,269 aNote Payable - Haywood PropertyNote Payable - Davison -Notes Payable - Private Debt 97,473Note Payable - Suburban/Uplander 13.745Note Payable - Chase (Pick-up Truck) 10,181Note Payable - Kubota TractorNote Payable - Marcia

Evenden All Other 1.079,579 25.000Total Third-Party Debt & Accrued Interest

$ 3,617,949 25,000

Partner Debt & Accrued Partner PaymentsDue Jerry Dunn & Affiliates [General Partner)Note Payable - Rossmoor Group 917,452 338,24

0Notes Payable - CMD -Notes Payable - J. Dunn (added to -Accrued Interest - Due General Partner

338,240 338.2401.255.693

GP Management Fees Payable 1,017,283Loan & Guaranty Fees Due GP 1,026,184

2,043,468Total Due Jerry Dunn & Affiliates $ 3.299,160

Due All Other PartnersNote Payble - Peter Malin 70,730 35,235Note Payable - Malin Group 24,165 12,989Note Payable - MB Partners 37,304 20,05 INote Payable - Gioia & Stern 23,130 12,432Other Assumed Liabilities 199,893 -Accrued interest 80,707 $ 80,707Total Due All Other Partners 435,929

a Paid in full in January 2008 from initial draw on new Development Loan from DFC.

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 52 of 74

Schedule D-1 2

Lone Oak has entered into loan agreements with Developer Finance Corporation (DFC) providing for (1) hypothecation (or purchase) of installment notes originated by the Partnership, and (2) acquisition and development financing.Effective with the closing of the purchase of assets in 2004, the Partnership

assumed existing debt owed by Mathews Bluff, Ltd. In addition, significant amounts have been loaned to the Partnership by Jerry R. Dunn and his affiliates. The terms of the Partnership's debt agreements are summarized below.

THIRD PARTY DEBT

DFC HYPO Line — A Revolving Developer Credit Line and SecurityAgreement was executed by the Partnership on October 4, 2004. The first drawwas made on November 4, 2004. DFC initially committed to lend a total of $3,000,000 and has subsequently increased the commitment to accommodate growth in the Partnership's note receivable portfolio. Advances are determined note-by-note, based principally on each purchaser's credit score, and can vary from 65% to 90% of the note principal. Interest is charged at prime plus 3.5% (10.75% and 11.75% at December 31, 2007 and 2006, respectively). An additional 1.0% is to be added if the weighted average FICO (Fair IsaacCompany) credit score for the pledged receivables falls below 650. DFC also receives 1.0% at the time of each advance, servicing fees of $8.50 per pledged receivable per month, and an additional 1.0% fee for any pledged note receivable principal prepaid. There are currently three separate Credit Lines. For all threeLines, the loan commitment period expires October 2008 and the contractual

maturity date for all loans is October 2015.

The HYPO Line is jointly and severally guaranteed by Jerry R. Dunn, Richard C.Jennings and the General Partner. DFC was granted an exclusive right of first refusal to finance or purchase all pledged receivables.

DFC A&D Loan — The Partnership executed an additional Revolving Credit Agreement with DFC on February 28, 2005. DFC agreed to advancefunds in an aggregate amount not to exceed $5,825,000 over a two-year period (subsequently extended) for certain costs incurred to develop the lots; exclusive of costs related to development of the golf course and club amenities. ThePrimary Collateral for the loans was initially 540 acres and 32 platted lots. The remaining platted lots were pledged to other pre-existing lenders, and wereSecondary Collateral for the loans. The maximum loan outstanding is limited to $2,500,000. However, release payments have been required as pledged lots are sold. Interest is at prime plus 3.5% and an advance fee of 1% must be paid witheach draw. If not previously paid, the loans mature in March 2008. All loans to

the Partnership by DFC are cross-collateralized so that a default on one loan represents a default on all obligations to DFC.

The loans are guaranteed by Jerry R. Dunn and Richard C. Jennings. The first draw was made in March 2005 in the amount of $820,000 and used to pay in full

/1(

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 53 of 74

Schedule D-1 3

assumed debts owed to the Mathews Trust and Dallas National Bank. Total advances for 2005 were approximately $1,849,000, all of which had been repaid as of December 31, 2005, through the release payments required by DFC. During 2006, additional advances of approximately $1,677,000 were made, all of which had again been repaid by year end December 31, 2006. The Partnership made additional draws of approximately $1,709,000 under this arrangement during 2007, and the outstanding balance at December 31, 2007, was approximately $419,000, The Loan Agreement also provides for DFC to issue Irrevocable Letters of Credit in favor of Hunt County, Texas, and the property owners associations as assurance of completion of roads and other improvements on a section-by-section basis.

Additional DFC Development Loan — In December 2007, the Partnership entered into an additional Revolving Credit Agreement with DFC to fund development costs related to approximately 145 acres known as Phase IX of the project. The initial draw of approximately $350,000 was made in January 2008 and was used to pay in full the Lone Star Land Bank loan described below which had been secured by certain acreage, including Phase IX.DFC also provided a Letter of Credit in the amount of $435,000 to the county to

assure construction of the roads as required for approval of the plat. The letter of credit is treated under this loan arrangement as an advance of principal.Maximum principal available is $1,200,000. During the term of the arrangement, the sum of (1) Letter of Credit outstanding and not drawn plus (2) Loans outstanding and unpaid, plus (3) Draws under the Letter of Credit and not reimbursed by the Partnership may not exceed $1,200,000. The Partnership may borrow, repay and reborrow under the facility for a period of nine months from the date of the initial draw, but aggregate advances may not exceed $1,800,000. Advances are also limited to 75% of verifiable "hard costs" for development of Phase IX.

Interest is payable monthly in arrears at prime plus 4.5% and is due on all outstanding Loans and the undrawn available amount of the Letter of Credit. DFC is also entitled to fees of 1.0% of each advance. Mandatory qu'arterly principal payments of $260,000 are required, beginning August 1, 2008, less release payments made. As secured lots are sold, release payments required are to be $11,765 per lot, applied first to outstanding Loans, and then to a reserve to be held by DFC as additional collateral and applied to future borrowings until the Letter of Credit has expired or been surrendered by the beneficiary.

Loans are secured by the real estate released by Lone Star Land Bank, when that loan was prepaid, and are also jointly and severally guaranteed by Jerry R .

Dunn and Richard C. Jennings. Any outstanding balance is due at maturity in January 2010 .

f..

/14/7.12,`11

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 54 of 74

Schedule D-1 4

Texas Community Bank — This loan was funded by the bank under a secured line of credit shared with affiliates of the General Partner. The Partnership is responsible only for its share of borrowings. Loans are secured by specific notes receivable pledged to the bank. Interest on this loan is payable at 8% per annum.

Lone Star Land Bank — The obligor on this note continued to be Mathews Bluff, Ltd., but it was contractually assumed by the Partnership effective June 4, 2004. Interest accrues at a variable rate that was periodically reset. The rate was adjusted to 7.91% (from 6.51%) effective November 11, 2006. Installment payments of approximately $26,000 were due annually in November of each year through 2031. This debt was paid in full in January 2008, as described above.

Purchase Money Note — Haywood Property — The sellers of this 70-acre parcel, acquired by the Partnership on November 30, 2005, accepted a note for $540,000 as partial payment of the purchase price. Interest at 6.5% was payable semi-annually. Principal was due as lots were sold based on release prices of approximately $4,300 per lot. Release payments paid the note in full during 2007.

Note Payable — Davison — The Partnership purchased a lot in the Rocky Ford Addition portion of the project from Mr. Davison during 2006 that he had acquired prior to formation of the Partnership. The consideration paid included a note for $70,000 with interest at 7.5% and due May 18, 2007 and was secured by two lots in Lakeside Village. This note was paid in full in August 2007.

Private Debt — Mathews Bluff, Ltd. originated this debt as part of a private placement of notes. As of June 4, 2004, the Partnership assumed an aggregate obligation to these note holders of $893,800 with interest at 7.5% per annum. The debt was secured by lots at Lone Oak known as The Vineyards, and release payments of $13,000 were required for each secured lot sold. Effective December 1, 2006, unpaid principal of $186,586 was converted to a new note. Monthly installments of $8,524, including interest at 9.0%, were due during 2007, and the balance was due December 1, 2007. The new note is unsecured but is personally guaranteed by Jerry R. Dunn. In December 2007, agreement was reached to continue monthly payments of $8,524 which are scheduled to pay this obligation in full by the end of 2008.

Note Payable — Suburban/Uplander — An assumed loan, secured by a Chevrolet Surburban used at the project, was refinanced with Texas Community Bank in September 2004. The loan was payable in monthly installments of approximately $348, including interest at 7.0% per annum. In September 2005, the Suburban was traded-in for a 2005 Chevy Uplander. The 0.0% note for the Uplander is due in 60 monthly installments.

003 qa

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 55 of 74

Schedule D-1 5

Note Payable — Chase — The purchase of a pick-up truck was financed at 5.6% interest and is due in monthly installments of $664.RELATED PARTY DEBT

Rossmoor Group/Colorado Mountain Development/Jerry Dunn —[Seller's rights to the principal and intertst on loans described in this paragraph will transfer to Purchaser as of the Effective Date.] Funds needed to form the Partnership and cover early stage operating costs were advanced by Jerry R. Dunn, Colorado Mountain Development (owned 100% by Jerry Dunn), and Rossmoor Group (a Jerry Dunn family partnership). As provided in the Partnership Agreement, funds advanced by Partners or their designated affiliates during the term of the Partnership are entitled to interest at 12.0% per annum, compounded annually, and are to be paid in full before any distributions may be made to any Partners. Accordingly, interest on these advances has been accrued at 12.0% per annum. There are no set payment terms for these notes. Rather, payments will be made only when, in the reasonable judgment of the General Partner, Partnership cash funds are sufficient to provide for such payments. All these loans were assigned to Rossmoor Group, L.P. effective January 1, 2007.

GP Management Fees Payable/Loan & Guaranty Fees Due GP —[Seller's rights to the fees described in these paragraphs will transfer to Purchaser as of the Effective Date.] The Partnership Agreement provides that the General Partner or its designee is entitled to a Development/Construction/Management Fee in the amount of 7.5% of gross sales as compensation for services. The fee is not to include any costs or expenses of the manager. In other words, it is a guaranteed payment to the GP that is in addition to costs and expenses incurred attributable to the Partnership. Accordingly, 7.5% of net sales has been accrued in the financial statements of the Partnership. While the Partnership Agreement allows for these payments by the tenth day of each month, payments are being made only when, in the reasonable judgment of the General Partner, Partnership cash funds are sufficient to provide for such payments.

The Partnership Agreement also provides for Loan and Guaranty Fees to the General Partner. Loan and finance facilitation fees of 1/4% of the loan amount are to be paid for any new loan or refinancing arranged for the Partnership and a guaranty fee of 5.0% of the loan amount is due the GP for any new loan or refinancing guaranteed by the GP or its affiliates. As noted above, Jerry Dunn and Richard Jennings have guaranteed the DFC financings previously described. Accordingly, fees equal to 5 1/4% of draws on the HYPO loan and the $2.5 million maximum outstanding balance of the DFC Acquisition and Development Loan have been accrued as of December 31, 2007. Additional fees will continue to be accrued subsequent to December 31, 2007, based on HYPO loan draws and any other new debt arranged and/or guaranteed by the General Partner. While the

11 )

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 56 of 74

Schedule D-1 - 6

Partnership Agreement allows for these payments upon first disbursement of any such loans, payments will be made only when, in the reasonable judgment of the General Partner, Partnership cash funds are sufficient to provide for such payments.

Peter Malin/Malin Group/MB Partners/Gioia & Stern/Other Assumed Liabilities — These liabilities were all included on a list of obligations to be assumed by the Partnership that was among the documents presented by the sellers at the closing on June 4, 2004. These liabilities are not deemed to be the result of funds advanced by Partners during the term of the Partnership. The terms of these Partnership obligations are summarized below:

n Note Payable — Peter Malin — As amended effective June 4, 2004, this note bears simple interest at 12.0% per annum. Principal of $84,555 and all accrued interest are not payable before maturity on June 2006. The Partnership has agreed to attempt to sell certain lots at the project owned by Mr. Malin. When sold, 15% will be retained by Lone Oak and 85% will be paid to Mr. Malin, of which amount 20% of the sales price will be applied toward payment of this note.

n Note Payable — The Malin Group — The unpaid principal assumed on this note was $24,165. The principal and simple interest at 15.0% per annum are not payable before June 2007.

n Notes Payable — Mathews Bluff Limited Partners — Two notes payable to certain limited partners of MBL were assumed in the aggregate principal amount of $24,165. Principal and simple interest at 15.0% per annum are not payable before April 2007. Notes Payable — Robert Gioia and Randolph Stern — Two separate, but essentially identical, notes payable to two limited partners of MBL were assumed. Unpaid principal of $11,565 for each note plus simple interest at 15.0% per annum are not payable before May 2007.

n Other assumed liabilities —The list of assumed liabilities included the following additional items:

-

The amount due A. Campey stems from a pre-existing arrangement to settle a professional services agreement. The letter agreement acknowledges that Mr. Campey's company is entitled to a credit of $76,875 against the purchase of a specified lot, or a comparable lot, which he has an option to buy for $100,000. If the Partnership elects to pay him in cash, he can accept the cash or exercise his option to buy a lot.

cv,

A. Campey $ 76,875Accounts payable 45,245Other payables to MBL related parties 77,773

$199,893

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 57 of 74

Schedule D-1 7

The Partnership has requested additional support for the accounts payable and other payables to MBL related parties listed above.

The General Partner believes the liabilities assumed from MBL are to be paid from 80.0% of Excess Cash Flow, as defined in the Partnership Agreement. Consequently, the timing for payment of specific liabilities described above is subject to cash being available to the Partnership for that purpose, regardless of the stated maturity dates included in notes payable to MBL related parties.

M a r c i a E v e n d e n — An employee of Co lorado Mountain Development agreed to loan $75,000 to the Partnership in July 2004. This loan was repaid in 24 monthly installments of $3,530, including interest at 12.0% per annum.

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 58 of 74

Schedule D-2 1

Schedule D-2

Bank Debt and Project Financing — Trinity

Third-Party Debt

December 31, 2007

Note Payable DFC - HYPO Lines 2,451,411Note Payable DFC - A&D Loan 502,270Texas Community Bank Line of Credit 63,305Texas Community Bank - Land Loan 1,170,000Texas Community Bank - Brewer Purchase Money Note Payable - P. G. 639,350Shelby Co. 142,306Total Third Party Debt 4,968.641

The terms of the Partnership's debt agreements are summarized below. THIRD PARTY DEBT

Purchase Money Note Payable to Seller— This note requires minimum quarterly payments of principal, plus accrued interest at 6.0% per annum, as follows:

Per Quarter TotalJuly 2005 and next three quarters $ 40,850 $ 163,400July 2006 and next three quarters 54,750 219,000

July 2007 and next three quarters 82,125 328,500July 2008 and next three quarters 122,275 489,100

$1,200,000

The Note is secured by a deed of trust for the lots and acreage initially purchased by the Partnership. Partial releases are to be granted for principal prepayments of $1,500 per lot during the first year, $2,000 per lot during the next two years, and $3,000 per lot during the fourth year. Release payments made are applied entirely to principal and counted toward the minimum quarterly principalpayments described above. Interest due is paid quarterly in arrears.

The noteholder is due a payment of principal and interest in the amount of $82,280 in January 2008. To settle this payment, he has been offered a land note serviced "in-house" by Lone Oak from Gary and Sharon Davis. The note was originated by Lone Oak in February 2005 and has a remaining principal balance of approximately $77,244. The balance of the payment was proposed to be paid in cash.

7' ti r ) WO1

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 59 of 74

Schedule D-2 2

Te x as C o mm u n i t y Ba n k — L an d A c qu is i t i on L o an — On August 3, 2005, the Partnership purchased approximately 157 acres of land contiguous to.the existing project. A portion of the purchase price was paid, in part, with a $513,000 loan provided by Texas Community Bank. Additional security was provided to the lender in the form of 30 developed lots released from the lien of the Purchase Money Note described above by prepaying the $1,500 per lot release price. Interest was the greater of 7.5% per annum or prime plus 2.0%. This note was prepaid in full on June 2, 2006, with proceeds of a new loan from DFC described in the following paragraph.

DFC Land Acqu is i t ion Loan — On June 2, 2006, the Partnership borrowed $825,000 from DFC under the terms of a Credit Agreement. Proceeds were used to complete the acquisition of an additional 150-acre contiguous parcel and to repay in full the Land Acquisition Loan from Texas Community Bank. Interest on this loan is payable monthly at a blended rate based on:

$572,500 prime plus 3.5%$155,500 8.0%, for one year, then prime plus 3.5%$ 97,000 25.0% per annum, on amount of loan in excess of 75% of

loan to value (as determined by DFC)$825,000 Initial overall blended rate was approximately 12.25%Loan principal is due in minimum quarter installments, beginning

September 2007, of $104,000. However, release payments are required upon sale of lots from the two land parcels that secure the loan, so that full payment is expected upon the sale of 70% of those lots. The loan is guaranteed by Jerry R. Dunn and the General Partner and has cross-default and cross-collateralization provisions with respect to the DFC HYPO Line described below.

DFC HYPO Line — A Revolving Developer Credit Line and Security Agreement was executed by the Partnership on June 14, 2005. The first draw was made on August 5, 2005. DFC's total commitment to lend was initially $3,000,000, but the limit has been increased over time as the Partnership's note receivable portfolio grows. Advances are determined note-by-note, based principally on each purchaser's credit score, and can vary from 65`Yo' to 90% of the note principal. Interest is charged at prime plus 3.5% and the contractual maturity date for all loans is currently June 14, 2013. An additional 1.0% is added if the weighted average FICO (Fair Isaac Company) credit score for obligors on the pledged receivables falls below 650. The increased rate of 4.5% over prime (11.75%) was in effect as of December 31, 2007. DFC also receives 1.0% at the time of each advance, servicing fees of $8.50 per pledged receivable per month, and is entitled to an additional 1.0% fee for any principal prepaid.

The HYPO Line is guaranteed by Jerry R. Dunn. DFC was granted an exclusive right of first refusal to finance or purchase all pledged receivables.

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 60 of 74

Schedule D-2 3

Texas Community Bank — Revolving Line of Credit — Effective July 12, 2005, the Partnership executed a one-year revolving line of credit agreement with Texas Community Bank providing for maximum outstanding borrowings of $500,000. Interest is at 8.0% per annum. Loans are secured by specific land notes receivable of the Partnership and are guaranteed by Jerry R. Dunn, Colorado Mountain Development, and the General Partner.The bank also agreed that a previously existing loan for $67,500 to Lone Oak Land Development Company, L.P. ("LOLDC"), an affiliated partnership, would remain outstanding under the terms of this agreement and an additional $132,516 was advanced to Lone Oak in April 2006. That portion of outstanding loans is secured by notes receivable of LOLDC and is being treated as debt of LOLDC and not reflected as debt of Trinity.Texas Community Bank — Land Loan - On December 26, 2007,

Texas Community Bank advanced $1,170,000 to the Partnership pursuant to a new Loan Agreement. The loan is payable on demand, but not later than December 26, 2010. The loan is secured by a first lien on 61 lots at the Project andis personally guaranteed b Jer R. Dunn, Colorado Mountain Deelopment and

e eneral artner o the Partnership. Int ,k-e§ritffie greater of prime plus 1.0% or. 0 per annt.75'7---ir----r----nisiDayab e monthly in arrears. Partial releases from the Deed of Trust are provided for and require principal payments of $26,000 per lot released. The Bank also provided a Letter of Credit in the amount of $45,000, in favor of Trinity County, and required the Partnership to deposit $45,000 in a certificate of deposit with the Bank that is pledged for use if and when the Letter of Credit is called.

Shelby Company — In October 2007, Shelby Company, a partnership in which Jerry Dunn has an interest, advanced $146,000 to the Partnership. This advance was repaid in full, without interest, in January 2008.

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 61 of 74

Schedule D-3 1

Schedule D-3

Bank Debt and Project Financing — Feather Bay

December 31, 2007

Debts to DFC -Note Payable DFC - HYPO Line 413,547N/P DFC - A&D Loans 4,196,066N/P DFC - Mezzanine LoansN/P DFC - Working Capital Loans

Total Debt to DFC 4,609,612Participation Fees Due DFC -

Total Due DFC 4,609,612

Other DebtNotes Payable - Texas Bank of Brownwood 345,293Note Payable - TX Bank of Brownwood (Pruitt) 290,247Note Payable - Heritage Land Bank 914,115Note Payable - David Pruitt 909,753N/P - John Janice Cain 118,980Note Payable - First National Abilene (Cary) 43,200N/P - Burl McCoy 65,600

N/P - Mrs. Tatum 5,000N/P - Mrs. Smith 13,000N/P GMAC - '07 Chevy Van 21,981

Total Other Debt 2.727.169

Subordinated Seller/"Partner" Debt 1,904,000

Total Third Party Debt 9.240,781

The terms of the Partnership's debt agreements are summarized below.

D F C A c q u i s i t i o n . D e v e l o p m e n t & W o r k i n g C a p i t a l L o a n s — The Partnership entered into a Credit Agreement with DFC dated December 4, 2006. The initial draw of $1,438,964 was applied to fund payment, at the closing on December 18, 2006, of certain assumed Seller liabilities. DFC represented to the Partnership that this Credit Agreement would act as a bridge loan to allow for the timely closing of the Feather Bay acquisition and that a permanent financing arrangement would be finalized within approximately 60 days from closing. Prior to that closing, DFC had acknowledged that all funding necessary todevelopment and sell the Feather Bay project would be provided by DFC because the Developer had no cash available for investment. Continuation of the Partnership's operations is dependent on continued funding from DFC.

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 62 of 74

Schedule D-3 2

As of February 2008, no permanent financing arrangement has been finalized. DFC has instead amended the initial Credit Agreement several times to extend the borrowing period and change the borrowing limit. Amendment No. 6, dated December 10, 2007, changed the limit to $4,305,000. Interest is payablemonthly at prime plus 4.5% and advance fees of 1.0% of each advance are also paid to DFC. Except for customer deposits and other miscellaneous cash received directly by the Partnership, all cash proceeds from lot closings are applied directly to repayment of this loan.

Loans are collateralized by a first lien on specified developed lots and undeveloped acreage and a second lien on other specified collateral. The loans are guaranteed by Jerry Dunn and the General Partner.In addition to the Credit Agreement, DFC has funded notes receivable from Partnership lot sales either by direct purchase pursuant to a Receivables Purchase Agreement or through loans hypothecated (i.e., pledged) to DFC.

DFC HYPO Line — A Revolving Developer Credit Line and Security Agreement was executed by the Partnership on April 5, 2007. DFC initially committed to lend a total of $3,000,000 under this Line. Advances are determined note-by-note, based principally on each purchaser's credit score, and can vary from 65% to 90% of the note principal. Interest is charged at prime plus 3.5%. An additional 1.0% is to be added if the weighted average FICO (Fair Isaac Company) credit score for the pledged receivables falls below 650. DFC also receives 1.0% at the time of each advance, servicing fees of $10.00 per pledged receivable per month, and an additional 1.0% fee for any pledged note receivable principal prepaid.

The HYPO Line is jointly and severally guaranteed by Jerry R. Dunn and the General Partner. DFC was granted an exclusive right of first refusal to finance or purchase all pledged receivables.

Texas Bank of Brownwood — Assumed Note Payable — At closing on December 18, 2006, the Partnership assumed an existing note payable to Texas Bank of Brownwood ("Texas Bank") with unpaid principal of $927, 000 and paid Texas Bank $400,000 of past-due interest. Texas Bank agreed to relinquish its collateral interest in residential lots at the project, but was given a first lien deed of trust-on the golf course acreage. In addition, the Bank is also a party to a Disbursement Agreement entered into at closing. Upon the sale of any of the existing 233 developed lots acquired at closing, Texas Bank is to receive $5,000 principal payment, with any unpaid balance due on or before April 15, 2008. Interest is payable monthly, in arrears, at prime plus 2.5%. In June 2007, the bank advanced another $88,293 for payment of past-due real property taxes assumed by the Partnership related to land comprising the golf course. The note

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 63 of 74

Schedule D-3 3

was guaranteed by Jerry R. Dunn until such time as the principal balance was reduced by 50%; that threshold reduction occurred during 2007.

Texas Bank of Brownwood — Additional Assumed Note Payable — In December 2007, the Partnership closed on the purchase from David Pruitt of approximately 233 acres of undeveloped land contiguous to the project. Texas Bank allowed the Partnership to assume previously existing mortgages on the property held by Texas Bank having unpaid principal of $216,747 (Note 1) and $73,500 (Note 2). The assumed *notes are personally guaranteed by Jerry R. Dunn, provided that such guarantee will be released when principal on the assumed notes has been reduced by 50%. Interest on these notes is payable monthly and adjusted annually in December to prime (at each interest adjustment date) plus 2.5%. Release payments of $2,500 per lot (if less than 1 acre) or $5,000 per acre sold are required. The notes are callable at the option of Texas Bank on December 23, 2009, and annually thereafter with a final maturity date of December 23, 2012.

David Pruitt — Purchase Money Note — Consideration for the purchase of land from David Pruitt described above included a non-interest bearing note issued to David Pruitt in the amount of $909,753. The note is secured by a second lien on the acreage purchased from Mr. Pruitt and is guaranteed by Jerry R. Dunn. Release payments of $1,500 per half-acre sold are required until Texas Bank has been paid in full, and thereafter $4,000 per half-acre. Final maturity is on or before December 14, 2012.

Heritage Land Bank — Assumed Loan — Debts assumed at closing in December 2006 included a land loan with unpaid principal of $1,306,244. Installment payments are generally required on January 1 and July 1 of each year through 2029, including principal and interest at prime plus 1.0%. The loan was originally secured by approximately 685 acres of raw land. However, in August 2007, the Partnership prepaid $382,308 of principal from proceeds of a $1,200,000 bulk sale of approximately 14 acres and the Bank released a total of 131 acres from the deed of trust. There is no set release price in the loan agreement, but this lender has expressed a willingness to negotiate 'similar releases of the secured acreage upon receipt of significant principal prepayments. Final maturity of the note is in 2028.

Heritage Land Bank is a cooperative and follows the practice of refunding a portion of its earnings to borrowers based on outstanding loan balances for the period. The Partnership received $35,055 in "patronage dividends" from Heritage in April 2007 that were treated as a reduction of interest capitalized with respect to this loan.

Cain Purchase Money Note — In June 2007, the Partnership purchased certain lots at the project for $132,200 from John and Janice Cain. Consideration paid included a promissory note for $118,960, secured by the lots purchased.

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 64 of 74

Schedule D-3 4

The note is payable in quarterly installments of $3,320, including interest at 7.5% and is due in full in August 2010. The lots purchased are expected to be re-platted and will be released from the deed of trust upon payment of an amount determined by (1) dividing the original principal balance of the note by the number of whole subdivided lots within the boundaries of the secured acreage and (2) multiplying the result by 125%.

Mark Cary and Burl McCoy, Assumed Loans — The Partnership assumed loans made to the Seller by Mark Cary, a principal of the Seller, and Burl McCoy having unpaid principal of $150,000 and $200,000, respectively, as of December 18, 2006. At closing, Cary was paid $20,000 and McCoy was paid $40,000 in satisfaction of all prior accrued interest on the notes. These individuals are parties to the Disbursement Agreement described above that modified their loans to provide for monthly payment of interest, in arrears, at prime plus 2.5%. Upon the sale of any of the existing 233 developed lots acquired at closing, Cary and McCoy are to receive principal payments of $800 and $1,000, respectively, and any unpaid balance is due April 15, 2008. Cary and McCoy released all liens against the property they may have previously held.

Other Assumed Loans — Personal loans made by Mrs. Tatum and Mrs. Smith amounting to $15,000 and $13,000, respectively, were also included on the list of liabilities assumed from the Seller by the Partnership. These loans are unsecured. The Partnership also financed the purchase of a Chevy Van used to transport prospective purchasers around the project. Installment payments are $521 per month.

Subordinated Seller/Partner Debt — Terms of the Purchase and Sale Agreement that closed on December 18, 2006, provide for future payments to the Seller totaling $1,904,000. The Agreement details "Partners' Debt" of $974,000, representing prior loans to the Seller from its partners. In addition, a note for $930,000 was issued to the Seller by the Partnership, the amount of which was based on equity advanced to the Seller by its individual partners. The note is secured by a 2'd lien on the golf course. These amounts bear no interest but are to be due and payable on December 18, 2011.

Other Assumed Liabilities — In addition to the assumed loans and other indebtedness described above, the Seller listed $145,798 of unpaid accounts payable to be assumed by the Partnership. These liabilities were recorded by the Partnership and included in the purchase price of the property, but as of December 31, 2007, only $13,511 had been paid. The extent to which these vendors will assert claims against the Partnership for the remaining $132,287 is uncertain.

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 65 of 74

Schedule D-4 1

Schedule D-4

Bank Debt and Project Financing — Dunrich Dunrich Debt as of December 31, 2007 is as follows:

Merchants Mortgage & Trust Corp. — A&D Loans $3,443,174Merchants Mortgage & Trust Corp — HYPO Loans 3,802,227Installment Note Payable — O'Neal 34.876

Total $7,280,277

Merchants Credit Facility - Effective with the closing of the purchase of assets in 2001, the Partnership assumed existing debt owed to Merchants by the sellers and entered into loan agreements with Merchants (the "Credit Facility")providing for (1) acquisition and development financing, (2) hypothecation of installment notes originated by the Partnership, and (3) sale of installment notes originated by the Partnership. In August 2003, this Credit Facility was modified and restated.

The original acquisition and development loan provided for interest at 4.5% over the US Bank National Association prime rate ("USB rate") in effect from time to time, but interest was payable currently only at the USB rate. The remainder was termed "deferred interest" that was allowed to accumulate, without accruingadditional interest, and was to be paid by the Partnership only after all other amounts due and owing Merchants had been paid, but not later than September1, 2006. The amount of deferred interest accruing prior to paying this original loan in full in December 2003 was $317,000, but Merchants has agreed to waive payment.

The acquisition and development loan (A&D Loan) bears interest (which was capitalized through 2005 and allocated to cost of lots sold) at the greater of 8.75% per annum or the USB rate plus 4.5% and matures on September 1, 2006. At such time as all lots in the project are sold, any unpaid balance on the A&D Loan is to be paid from an advance on the hypothecation loan. ThePartnership may borrow funds under the hypothecation loan until September 1,

2006, after which the unpaid balance is to be amortized over 60 months (i.e., final maturity of September 1, 2011). Interest on the hypothecation loan ispayable at the greater of 9.0% or the USB rate plus 4.75% and is expensed as incurred.

Merchants has agreed to make additional "temporary" concessions with respect to interest rates on the loans outstanding. Rates in effect during most of 2006 and the first half of 2007 were 4.0% for the A&D Loan and 8.25% forhypothecation loans. Merchants further agreed to waive all interest on the A&D

Loan for the period from July 1, 2007 through June 30, 2008.

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 66 of 74

Schedule D-4 2

Loans from Merchants are secured and collateralized by virtually all present and future assets of the Partnership, whether tangible or intangible. In addition, up to $500,000 of the Partnership's indebtedness to Merchants is personally guaranteed by Jerry R. Dunn. In October 2004, Jerry Dunn and Rich Jennings each guaranteed an additional amount of $68,898, plus interest, related to funds advanced by Merchants to pay WRI over-rides (2.0% of sales) that were in arrears. Generally, the acquisition and development loan is secured by a first deed of trust on the Partnership's land, lots and other real property. The hypothecation line is secured by pledged notes receivable. However, all loans to the Partnership by Merchants are cross-collateralized so that a default on any loan or advance represents a default on the entire Credit Facility. As lot sales close, if there is no default and certain other conditions are met, the Partnership is granted partial releases from the first deed of trust upon debt repayments as determined by Merchants.

Merchants services all notes purchased from, or pledged to Merchants by, the Partnership. Cash collections by Merchants on pledged receivables are applied directly by Merchants to the Partnership's debt obligations. Additional advances of operating funds to the Partnership are currently being provided at the discretion of Merchants.

"Tax loans" — The Credit Facility restricts the Partnership from making -----1 distributions to Partners until all debt due Merchants has been repaid. During 2004, Merchants agreed to make loans directly to Jerry Dunn and Rich Jennings for the purpose of paying income taxes related to their respective shares oftaxable income allocated to them from the Partnership. As of December 31, 2007, these loans and accrued interest totaled approximately $343,000. Interest is automatically added to the outstanding balances of these loans each month (initially, at the greater of 8.75% per annum or the USB rate plus 4.5%; however, Merchants has applied lower interest rates to these loans in 2006 and 2007). The accumulated balance is to be paid over 26 months commencing November

1, 2010. The loans are collateralized by the limited partner interests of Mr. Dunn and Mr. Jennings in the Partnership. Loans made to Mr. Jennings are also personally guaranteed by Mr. Dunn. Although due directly from these partners, the loans are cross-collateralized with all other debt of the Partnership owed to Merchants.

Effective January 1, 2006, Jerry Dunn agreed that management fees equal to 5% of Partnership revenues and otherwise payable to him would be specifically directed toward repayment of the tax loans.

Other debt — Other debt includes a Real Estate Lien Note related to the acquisition of 9.877 acres on April 10, 2001. Monthly installments of $1,004.28, including principal and interest at 8.5% per annum are due over the 10-year term of the Note. The balance at December 31, 2007, was $34,879.

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 67 of 74

EXHIBIT "E"

CLAIMS

To be attached within fifteen (15) days of the Execution Date

23

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 68 of 74

EXHIBIT "F"

THIRD PARTY OWNERS

To be attached within fifteen (15) days of the Execution Date

24

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 69 of 74

EXHIBIT "G"NON-FOREIGN AFFIDAVIT

STATE OF COLORADO

COUNTY OF

Jerry R. Dunn, ("Dunn"), individually and as President of _______________, a Texascorporation, the sole general partner of _____________________ L.L.C., a Texas limitedliability company (the "General Partner"), being first duly sworn, deposes and says:

1. This affidavit is being made with reference to Section 1445 of the UnitedStates Internal Revenue Code which requires the transferee of any United States real property to deduct and withhold a tax equal to 10% of the amount realized on the disposition.

2. That the undersigned is an individual resident of the State of Colorado, whosebusiness address is 6000 Greenwood Plaza Blvd., Suite 120 Greenwood Village, CO 80111.

3. That the undersigned is a duly authorized officer of the General Partner, theowner of that certain piece or parcel of real property situated in the County of State of Texas, being conveyed to 3D Resorts, Inc. and/or its assigns, a description of such property attached hereto as Exhibit "A" and made a part hereof.

4. That the undersigned and the General Partner are not foreign persons withinthe meaning of Section 1445 of the United States Internal Revenue Code.

5 . T h a t t h e U n i t e d S t a t e s T a x I d e n t i f i c a t i o n N u m b e r o f t h e L L Cis

1. That the undersigned declares under penalty of perjury that the foregoing is true and correct.

IN WITNESS WHEREOF, the undersigned has executed this instrument on this day of____________________, 2008.

L.L.0

By:a Texas limited liability company, as its sole general partner

By:_________________________________Jerry R. Dunn, Manager

25

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 70 of 74

STATE OF COLORADO

COUNTY OF______________

This instrument was acknowledged before me on the day of_______________,2008, by Jerry R. Dunn, individually and as President of__________, the sole generalpartner of_______________, L.L.C., a Texas limited liability company.

Notary Public, State of

Colorado My Commission

Expires:Printed name of Notary Public:

26

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 71 of 74

EXHIBIT "E"

CLAIMS

1.The following lawsuits are now pending against one or more of the companies:

a. Tachibana vs. Lone Oak Land Development Company, et al. (Summary and pleadings in this case have been attached hereto.)

b. Phillip Meier vs. Dunrich Holding Company. This is a case concerning a boundary dispute on a lot at Wildwood Shores that is being contested. A joint defendant is the survey company that made the mistake and we feel that there is an obligation for them to pay the claim. This is not yet set for trial in Walker County, Texas.

2. The following are cases that one or more of the entities have in which they are the

plaintiff:

a. Dunrich Holding Company vs. Southern Journeys. This is a claim for nonpayment of leads furnished to Southern Journeys, Inc. through our phone room.

b. Feather Bay Land Development Company, L.P. vs. John D. Oschner. This is a cash pending in Brown County concerning a dispute on title to a lot in the development. It is presently in discovery and has not yet been set for trial.

c. Trinity County Land Development, L.P. vs. Alamo Title. This is a dispute for a small section of land that was not covered by the title policy when we purchased a bulk piece

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 72 of 74

Trinity PlantationLot Owner

NameLegal

LotDescr ip t ion Block Section

DemandLetter

LienFiled

Suit Deed

Filed Back

Avirett, Emory 1 9 A 08/26/06 28-Mar-06Bass, Margie Ette 26 1 B 05/24/07 SWD SENT TO BASS FOR SIG. 8/Bell, John & Teresa 14 3 B 01/02/07Britton, Michael 2 14 B 08/26/06 28-Mar-06 12-Jun-06Britton, Michael 3 14 B 08/26/06 28-Mar-06 12-Jun-05Byrne, Randy & Tammy 26 4 A 01/02/07Cleaveland, Harry & Carolyn 9 9 B 01/02/07Craig, Rachel & Michael 2 5 A 02/27/06Davis, Robert 9 5 A yesDay, Shirley 15 3 B yesDel Norte 16 1 B yesDickinson, Marjorie 7 2 B 06/26/07Donley, Robert 10 15 B 28-Mar-06 6-Jun-06Dove, David & Susie 30 1 B 16-Feb-06 9-Oct-05Farmer, Cheryl 3 10 A 08/30/06 28-Jul-06George, Bower B & Lydia. 8 1 B 01/18/07Hall, Stanley 3 6 B yesHebert, Joseph 1 10 B 08/30/06 28-Jul-06Johnson, M. a 16 6 B 09/20/06 23-Feb-06 28-Mar-06Johnson, Richard 21 4 A 02/27/06 23-Feb-06 15-Oct-02Kilpatrick, Kirk 13 4 B 09/20/06 23-Feb-06 28-Mar-06Knight, Margie & Charles 23 2 B 02/27/06 25-Jul-06Landry, Winnie 1 16 B 01/02/07Lavender, Lawrence 1 6 A 09/20/06 728/06Lawson, Robert 8 11 A 09/20/06 23-Feb-06 28-Mar-06Martin, Brian T. 12 2 B 01/18/07Mendez, Geraldo 3 5 B yesMills, Richard 4 19 B 09/21/06 28-Mar-06 12-Jun-06Moller, Raymond ??? 5 18 B 09/29/06 28-Mar-06 4/4/2006Morris, Gregory 6 20 B yes

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 73 of 74

Oxford Finance 1 16 B 07/19/06 4-Aug-06Oxford Finance 14 3 B 07/19/06 4-Aug-06Oxford Finance 21 18 B 07/19/06 4-Aug-06Oxford Finance 26 4 A 07/19/06 4-Aug-06Oxford Finance 5 9 A 07/19/06 4-Aug-06Oxford Finance 6 11 B 07/19/06 4-Aug-06Oxford Finance 8 1 B 07/19/06 4-Aug-06Oxford Finance 9 9 B 07/19/06 4-Aug-06Perez, Anthony & Ana Marie 6 11 B 02/14/07Powers, Danny 3 11 A yesRodriquez, Francisco 5 4 B 09/29/06 28-Mar-06 6-Jun-06Sullivan, J.E. & Ann Lee 21 18 B 01/25/07Surratt, Verdie (deceased) 1 14 B 10/11/06 23-Feb-06 28-Feb-06Tamayo, Mark 2 17 B yesThompson, Glenn R. 9 15 B 08/30/06 28-Jul-06 23-Oct-06Toney, Mary 2 20 B 10/11/06 28-Jul-06Walter, Thomas 14 9 B yesWheeler, Stella 6 9 A 10/11/06 28-Jul-06

Case 4:09-cv-03514 Document 11-3 Filed in TXSD on 06/04/10 Page 74 of 74

Lot foreclosure:

Lone Oak Land Development Company, L.P. vs. Keeton-Griffin Lot no. 3, Lakeside, Villages at Lone OakMarch 3, 2008