• Real Estate Consulting and
Appraisal Services •
• Plano, Texas •
Southlake, Texas •
www.jacksonclaborn.com
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Jimmy H.
Jackson, MAI
Allen W. Gardiner, SRA
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David Claborn, MAI
Dod W. Clapp, SRA
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United
Development Funding III, L.P.
1702 N. Collins Boulevard
Suite 100
Richardson, Texas 75080
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Mr. Jeff
Shirley, President
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UMTH Land
Development, L.P.,
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It’s
general partner
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You have requested
our opinion as an independent advisor (as that term is defined in
the Prospectus of United Development Funding III, L.P. dated
May 15, 2006) as to the fairness of the terms of that certain
limited guaranty dated as of the 1st day of August, 2006 by United
Development Funding III, L.P., a Delaware limited partnership,
(“UDF III”) for the benefit of United Mortgage Trust, a
real estate investment trust organized under the laws of the state
of Maryland or its permitted successors and assigns, (the
“UDF III Guarantee”) and that certain letter with
respect to the Credit Enhancement Fee related to Guaranty of Note
by and between United Development Funding, L.P., a Nevada limited
partnership, (“UDF”) and United Development Funding
III, L.P., a Delaware limited partnership (the “UDF III
Credit Enhancement Fee Agreement”).
We understand that
pursuant to the UDF III Guarantee and the UDF III Credit
Enhancement Fee Agreement that UDF III will guarantee the repayment
of an amount up to $30 Million with respect to that certain Second
Amended and Restated Secured Line of Credit Promissory Note between
United Mortgage Trust (“UMT”) and UDF, and, in exchange
for that guarantee, UDF shall pay UDF III each month in arrears and
amount equal to one-quarter of one percent (0.0025%) of the maximum
liability amount. We further understand that the UDF III guarantee
shall be reduced $1.00 for every $1.00 by which the total
partners’ equity of UDF exceeds $30 Million and that as of
July 31, 2006, UDF total partners’ equity was
$32,522,833.
We are a full
service real estate appraisal and consulting firm. As part of our
real estate appraisal and consulting services, we are regularly
engaged in the consultation with regard to real estate value and
finance.
Headquarters: 5800 W. Plano Parkway • Suite 220
• Plano, Texas 75093 • (972) 732-0051 • FAX
(972) 733-1403
Branch Office: 1560 E. Southlake Blvd. • Suite 220
• Southlake, Texas 76092 • (817) 421-3833 •
FAX (817) 421-3844
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