Case 4:11-cv Document 195 Filed in TXSD on 08/08/14 Page 1 of 8

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1 Case 4:11-cv Document 195 Filed in TXSD on 08/08/14 Page 1 of 8 IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION SECURITIES AND EXCHANGE COMMISSION, PLAINTIFF, vs. BRIAN A. BJORK, THE ESTATE OF JOEL DAVID SALINAS, J. DAVID GROUP OF COMPANIES, INC., J. DAVID FINANCIAL GROUP LP, SELECT ASSET MANAGEMENT LLC, SELECT ASSET CAPITAL MANAGEMENT LLC, SELECT ASSET FUND I, LLC, AND SELECT ASSET PRIME INDEX FUND, LLC. DEFENDANTS. CIVIL ACTION NO. 4:11 CV RECEIVER S UNOPPOSED MOTION TO APPROVE THE SALE OF CHIQUITA STREET, GALVESTON, TEXAS TO THE HONORABLE KEITH P. ELLISON, UNITED STATES DISTRICT COURT: Steven A. Harr ( Receiver ), the Receiver appointed by the Court in these proceedings, files this Unopposed Motion to Approve the Sale of Chiquita Street, Galveston, Texas described more specifically in Exhibit A (the Property ) respectfully stating: I. BACKGROUND 1. On August 1, 2011, the Securities and Exchange Commission ( SEC ) filed its Complaint against Defendants. In conjunction therewith, the SEC sought, and by Order Appointing Receiver (the Order ), the Court appointed, Steven A. Harr as the Receiver for Brian A. Bjork, The Estate of Joel David Salinas, J. David Group of Companies, Inc., J. David Financial Group LP, Select Asset Management LLC, Select Capital Management, LLC, Select Asset Fund I, LLC and Select Asset Prime Index Fund, LLC (collectively, the Receivership Entities ). MHDocs _

2 Case 4:11-cv Document 195 Filed in TXSD on 08/08/14 Page 2 of 8 2. As the Court ordered, the Receiver was authorized to have complete and exclusive control, possession and custody of all Receivership assets and Receivership records of Defendants. Receivership Assets and Receivership Records were defined in the Order as assets, monies, securities, properties, real and personal, tangible and intangible, of whatever kind and description, wherever located, and the legally recognized privileges (with regard to the entities), of the [Receivership Entities] and all entities they own or control..., and the books and records, client lists, account statements, financial and accounting documents, computers, computer hard drives, computer disks, internet exchange servers telephones, personal digital devices and other informational resources of or in possession of the [Receivership Entities] or issued by [Receivership Entities] and in possession of any agent or employee of the [Receivership Entities] The Receiver has been engaged in efforts to sell certain real estate previously owned by J David Salinas and his wife. Included in this group of real estate assets is the Property. An offer has been made and accepted by the Receiver for the sale of the Property and the Receiver now seeks court approval to complete the sale and close the contract. II CHIQUITA STREET 4. The Receiver identified and recovered the Property shortly after being appointed. The legal description of the Property is attached hereto as Exhibit A. The Property is commonly described as Chiquita Street, Galveston, Texas. The Property and related assets are currently owned by The Receiver. The Property is a canal front home previously utilized as a vacation home by J. David Salinas, his wife Robbin and their daughter Sommer Salinas. Title to the Property is in the Receiver in light of the agreements previously 1 Order Appointing Receiver, 1. MHDocs _

3 Case 4:11-cv Document 195 Filed in TXSD on 08/08/14 Page 3 of 8 made with the Estate of J. David Salinas and Robbin and Sommer Salinas (Dkt# 51) that have already been approved by this Court. III. AUTHORITIES 5. In receiverships, federal courts have broad equitable powers enabling them to fashion appropriate ancillary remedies necessary to grant full relief. SEC v. Blatt, 583 F.2d 1325 (5th Cir. 1978); Manor Nursing Centers, 458 F.2d 1082, (2d Cir. 1972). 6. It is also well settled that this Court has the authority to direct property to be sold by a receiver. See generally Moore s Federal Practice, Vol 13, Ch. 66 (Matthew Bender 3d ed. 1997); Federal Practice & Procedure, Vol 12, ; Clark on Receivers (Anderson 2d ed. 1929); also see, e.g., First Nat l Bank of Cleveland v. Shedd, 121 U.S. 74 (1887); SEC v. Forex Asset Mgmt. v. Waller, Receiver, 242 F.3d 325 (5th Cir. 2001) The only statutory restrictions upon the exercise of the Court s discretion are found in 28 U.S.C & 2002 (2004). These statutes provide in relevant part: Sale of Realty Generally (a) Any realty or interest therein sold under any order or decree of any court of the United States shall be sold as a whole or in separate parcels at public sale at the courthouse of the county, parish, or city in 2 This Court's authority to effect a sale of property derives from its equitable power, which is fundamentally granted by Section 2 of Article III of the United States Constitution, and also by statute, as being coextensive with the powers of an English court of chancery at the time of the separation of the two countries. Matthews v. Rodgers, 284 U.S. 521, 529, 52 S. Ct. 217, 221 (1932) (referring to Judiciary Act of 1789, 1 Stat. 78). The Federal Rules of Civil Procedure, in turn, expressly provide that: The practice in the administration of estates by receivers or by other similar officers appointed by the court shall be in accordance with the practice heretofore followed in the courts of the United States or as provided in rules promulgated by the district courts. Fed. R. Civ. P. 66. The practice of appointing receivers is commonly dated to the reign of Queen Elizabeth I of England. See, e.g., I Clark on Receivers 6, at 8 (Anderson 2d ed. 1929). It continues to the present. See, e.g., SEC v. Forex Asset Management v. Waller, Receiver, 242 F.3d 325 (5th Cir. 2001) (affirming an order of the United States District Court for the Northern District of Texas approving a distribution plan proposed by a receiver appointed by Judge Solis). Moore's Federal Practice devotes an entire chapter to the subject. Moore's Federal Practice, Vol 13, Ch. 66 (Matthew Bender 3d ed. 1997). Wright and Miller's procedural treatise has six sections. Federal Practice & Procedure, Vol 12, MHDocs _

4 Case 4:11-cv Document 195 Filed in TXSD on 08/08/14 Page 4 of 8 MHDocs _ which the greater part of the property is located, or upon the premises or some parcel thereof located therein, as the court directs. Such sale shall be upon such terms and conditions as the court directs. Property in the possession of a receiver or receivers appointed by one or more district courts shall be sold at public sale in the district wherein any such receiver was first appointed, at the courthouse of the county, parish or city situated therein in which the greater part of the property in such district is located, or on the premises or some parcel thereof located in such county, parish, or city, as such court directs, unless the court orders the sale of the property or one or more parcels thereof in one or more ancillary districts. (b) After a hearing, of which notice to all interested parties shall be given by publication or otherwise as the court directs, the court may order the sale of such realty or interest or any part thereof at private sale for cash or other consideration and upon such terms and conditions as the court approves, if it finds that the best interests of the estate will be conserved thereby. Before confirmation of any private sale, the court shall appoint three disinterested persons to appraise such property or different groups of three appraisers each to appraise properties of different classes or situated in different localities. No private sale shall be confirmed at a price less than two-thirds of the appraised value. Before confirmation of any private sale, the terms thereof shall be published in such newspaper or newspapers of general circulation as the court directs at least ten days before confirmation. The private sale shall not be confirmed if a bona fide offer is made, under conditions prescribed by the court, which guarantees at least a 10 per cent increase over the price offered in the private sale. (c) This section shall not apply to sales and proceedings under Title 11 or by receivers or conservators of banks appointed by the Comptroller of the Currency Notice of Sale of Realty A public sale of realty or interest therein under any order, judgment or decree of any court of the United States shall not be made without notice published once a week for at least four weeks prior to the sale in at least one newspaper regularly issued and of general circulation in the county, state, or judicial district of the United States wherein the realty is situated. If such realty is situated in more than one county, state, district or circuit, such notice shall be published in one or more of the counties, states, or districts wherein it is situated, as the court directs. The notice shall be substantially in such form and contain such description of the property by reference or otherwise as the court approves. The court may direct that the publication be made in other newspapers. This section shall not apply to sales and proceedings under Title 11 of or by receivers or conservators of banks appointed by the Comptroller of the Currency. 4

5 Case 4:11-cv Document 195 Filed in TXSD on 08/08/14 Page 5 of 8 8. The Receiver proposes to sell the Property pursuant to the existing sales contract via a private sale. The option of public notice and auction is not being pursued. Accordingly, the requisite minimum three opinions of value have been obtained for the Property and several others are also available to support the value of the Property and the sale price. 3 The Property has been on the market for over two years with very limited interest due to the cost, location, and the substantial renovations needed to the Property. The public and all interested parties have been given more than adequate notice of the availability and price for the Property. The Receiver moves the Court, pursuant to its equitable authority, to authorize the sale, finding that no further notice of the sale is required. Such terms will conserve the receivership estate by saving the estate the time and money of publishing the contract in the newspaper once a week for four weeks. IV. EFFORTS TO SELL THE PROPERTY 9. The Property, as described above, consists of a single family canal front dwelling located in Galveston, Texas. Immediately upon declaration that the Receiver was the legal and equitable owner of the Property, the Receiver sought and engaged a real estate agent to list and begin marketing the Property. The opinions on the value of the Property received from these appraisers indicated an estimate worth of $485,000, $495,000, $515,000 and $540, Taking into account the appraisals received as well as the costs associated with maintaining a canal front property, the condition of the Property, and the benefit of selling expeditiously, the Receiver originally listed the Property for $495, The four independent property appraisals received and relied upon by the Receiver are attached hereto as Exhibit B. 4 See Exhibit B. 5 MHDocs _

6 Case 4:11-cv Document 195 Filed in TXSD on 08/08/14 Page 6 of For almost two years, the Receiver did not receive any competitive offers to purchase the Property. With only modest attention paid to the listing and with only two offers of $415,000 and $400,000, the Receiver was left with no choice but to reduce the listed price to $440,000 in July 2014 to keep the listing fresh in the market and to attract a buyer. 11. After considerable time and effort in marketing and maintaining the Property, the Receiver has identified a purchaser of the Property who has offered to pay, in cash, $425,000 (the Offer ). The Offer is well above the statutorily-mandated sale price of two-thirds of the average value The current sales contract entered into by the Receiver and the buyer includes the following language: This contract is subject to court approval by the United States District Court for the Southern District of Texas. The Receiver agrees to file a motion for approval within five business days of the expiration of the option period in [paragraph] 33. The Receiver does not anticipate any objections by any third party or the Court to the motion for approval, and based on past experience, expects the Court to issue an order of approval within 7 days. If the contract is not approved by the Court by Aug. 12, 2014, it shall be null and void. The fifth day after the expiration of the option period under the contract is August 8, By subsequent agreement, the deadline for Court approval was extended to August 21, In an effort to comply with the express provisions of the sales contract, the Receiver presents this Motion to the Court with permission to sell the Property and contribute the entirety of the funds received to the Receivership Estate. 5 A true and correct copy of the Contract of Sale for the Property along with its Amendment (the Contract ) is attached hereto as Exhibit C. At the start of this year, the Receiver discovered that the tax appraisal value for the Property was set in excess of $740,000. Considering the status of the Receiver s efforts to sell the Property, it was event that this figure was excessively high. As a result, the Receiver protested the tax appraisal on the Property and ultimately had it reduced to $435,000 on or around June 11, A copy of the Final Agreement indicating this reduction with the Galveston Central Appraisal District is attached hereto as Exhibit D. MHDocs _

7 Case 4:11-cv Document 195 Filed in TXSD on 08/08/14 Page 7 of PNC Bank ( PNC ) is the mortgagor of the Property. The outstanding balance on the mortgage is approximately $357, The outstanding balance on the mortgage owed to PNC will be paid in full from the proceeds of the sale. There are no other clouds on the title to the Property. The proceeds from the sale of the Property after payment of the outstanding mortgage, agent commissions, and all other fees will be deposited with the Receivership Estate for the benefit of all affected victims. 14. Accordingly, the Receiver submits that the sale of the Property pursuant to the Contract would be in the best interest of the Receivership Estate. 15. The Receiver requests that the Court declare that the Receiver is the legal and equitable owner of the Property, free and clear of any and all liens, and allow the Receiver to sell the Property pursuant to the terms of the Contract or terms substantially similar thereto. 16. Pursuant to Local Rule CV-7, the Receiver advises the Court that the Plaintiff Securities and Exchange Commission does not oppose the relief requested in this Motion. The Defendant entities are all controlled by the Receiver. V. CONCLUSION WHEREFORE, the Receiver prays that the Court enter an Order in the form submitted with this Motion, or for substantially the same relief in such form as the Court may find just and proper. MHDocs _

8 Case 4:11-cv Document 195 Filed in TXSD on 08/08/14 Page 8 of 8 Dated this 8 th day of August, Respectfully submitted, By: /s/steven A. Harr STEVEN A. HARR SDTX Bar No SAMEER S. KARIM SDTX Bar No MUNSCH HARDT KOPF & HARR, P.C. 700 Louisiana St., Suite 4600 Houston, Texas (713) (telephone) (713) (facsimile) skarim@munsch.com CERTIFICATE OF CONFERENCE On August 8, 2014, I conferred with Tim McCole and he stated that the Securities and Exchange Commission is not opposed to this Motion. /s/ Steven A. Harr Steven A. Harr CERTIFICATE OF SERVICE I certify that a copy of the foregoing was filed electronically with the Clerk via the CM/ECF system. Notice of this filing will be sent to all parties by operation of the Court s electronic filing system. Houston, Texas, this 8 th day of August, /s/ Steven A. Harr Steven A. Harr 8 MHDocs _

9 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page 1 of 1 EXHIBIT A Lot Seventh-Four (74) of REPLAT OF LOTS 64 THROUGH 78 OF TERRAMAR BEACH, SECTION SIX(6), a subdivision in Galveston County, Texas according to the map or plat thereof record in Volume 18, Page 199 of the Map Records of Galveston County, Texas. MHDocs _

10 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page 1 of 82 Main File No Page #1 SUBJECT Uniform Residential Appraisal Report File # The purpose of this summary appraisal report is to provide the lender/client with an accurate, and adequately supported, opinion of the market value of the subject property. Property Address Chiquita City Galveston State TX Zip Code Borrower n/a Owner of Public Record Joel D. Salinas County Galveston Legal Description Lot 74 Terramar Beach Section 6 Replat Assessor's Parcel # Tax Year 2010 R.E. Taxes $ 14,995 Neighborhood Name Terramar Beach Map Reference 835Y Census Tract Occupant Owner Tenant Vacant Special Assessments $ n/a PUD HOA $ unk per year per month Property Rights Appraised Fee Simple Leasehold Other (describe) Assignment Type Purchase Transaction Refinance Transaction Other (describe) Decision making purposes Lender/Client Steve Harr Address 700 Louisiana St., Ste Houston, TX Is the subject property currently offered for sale or has it been offered for sale in the twelve months prior to the effective date of this appraisal? Yes No Report data source(s) used, offering price(s), and date(s). MLS/CAD CONTRACT I did did not analyze the contract for sale for the subject purchase transaction. Explain the results of the analysis of the contract for sale or why the analysis was not performed. Not a sale. Contract Price $ n/a Date of Contract n/a Is the property seller the owner of public record? Yes No Data Source(s) n/a Is there any financial assistance (loan charges, sale concessions, gift or downpayment assistance, etc.) to be paid by any party on behalf of the borrower? Yes No If Yes, report the total dollar amount and describe the items to be paid. n/a NEIGHBORHOOD Note: Race and the racial composition of the neighborhood are not appraisal factors. Neighborhood Characteristics One-Unit Housing Trends Location Urban Suburban Rural Property Values Increasing Stable Declining Built-Up Over 75% 25-75% Under 25% Demand/Supply Shortage In Balance Over Supply Growth Rapid Stable Slow Marketing Time Under 3 mths 3-6 mths Over 6 mths Neighborhood Boundaries Neighborhood Description Area bound by Gulf of Mexico to south, West Galveston Bay on north, Vacant land on west and Galveston Island State Park to east. Characterized by waterfront and dry land resort homes. One-Unit Housing Present Land Use % PRICE AGE One-Unit 60 % $ (000) (yrs) 2-4 Unit 0 % 125 Low new Multi-Family 1 % 1MM+ High 20+ Commercial 9 % 450 Pred. 15 Other 30 % Shopping provided by nearby convenience stores on FM Many water related activities such as fishing, boating, etc. due to nearness of Gulf and Bay. Schools and primary shopping located 20 miles east in Galveston proper. Local realty offices indicate exposure periods of up to 12 months assuming good appeal and realistic pricing. Market Conditions (including support for the above conclusions) Hurricane Ike ( ) and sluggish national economy have combined to stymie the local real estate market on the Island. However, many properties have been or are being repaired. Dimensions no survey provided Area 5,003 SF/CAD Shape mostly rectangular View gd/canal/bay Specific Zoning Classification "1F-2" Zoning Description "Single Family Residence" Zoning Compliance Legal Legal Nonconforming (Grandfathered Use) No Zoning Illegal (describe) Is the highest and best use of subject property as improved (or as proposed per plans and specifications) the present use? Yes No If No, describe SITE Utilities Public Other (describe) Public Other (describe) Off-site Improvements - Type Public Private Electricity Gas Water Sanitary Sewer Street Alley 2 lane concrete no FEMA Special Flood Hazard Area Yes No FEMA Flood Zone VE FEMA Map # E FEMA Map Date 12/6/2002 Are the utilities and off-site improvements typical for the market area? Yes No If No, describe Are there any adverse site conditions or external factors (easements, encroachments, environmental conditions, land uses, etc.)? Yes No If Yes, describe Typical utility easements observed, however, no survey provided. IMPROVEMENTS General Description Foundation Exterior Description materials/condition Interior materials/condition Units One One with Accessory Unit Concrete Slab Crawl Space Foundation Walls slab with pilings/gd Floors tile/carpet/good # of Stories 2 Full Basement Partial Basement Exterior Walls stucco/gd Walls drywal/lgood Type Det. Att. S-Det./End Unit Basement Area n/a sq.ft. Roof Surface comp shingle/good Trim/Finish wood/good Existing Proposed Under Const. Basement Finish N/A % Gutters & Downspouts yes/good Bath Floor tile/good Design (Style) resort Outside Entry/Exit Sump Pump Window Type vinyl impact/good Bath Wainscot corian/gd Year Built c 2005 Evidence of Infestation none obsvd Storm Sash/Insulated yes/good Car Storage None Effective Age (Yrs) 5 yr eff Dampness Settlement Screens partial/electric Driveway # of Cars multi Attic None Heating FWA HWBB Radiant Amenities Woodstove(s) # Driveway Surface concrete Drop Stair Stairs Other Fuel electric Fireplace(s) # Fence Garage # of Cars 1.5-car Floor Scuttle Cooling Central Air Conditioning Patio/Deck Porch front Carport # of Cars Finished Heated Individual Other Pool Other Att. Det. Built-in Appliances Refrigerator 2 Range/Oven Dishwasher Disposal Microwave Washer/Dryer Other (describe) Finished area above grade contains: 10 Rooms 5 Bedrooms 3 Bath(s) 2,689 Square Feet of Gross Living Area Above Grade Additional features (special energy efficient items, etc.). countertops, built-ins, ceiling fans. Storage/Bar/1.5 car garage on grade level (724 SF), boathouse/boatlift, 2 jetski lifts, outdoor shower, sprinkler system, granite Describe the condition of the property (including needed repairs, deterioration, renovations, remodeling, etc.). The subject was in overall good condition at our inspection and is situated on a canal lot with very good bay views and extensive decks/porches/balconies. Are there any physical deficiencies or adverse conditions that affect the livability, soundness, or structural integrity of the property? Yes No If Yes, describe Does the property generally conform to the neighborhood (functional utility, style, condition, use, construction, etc.)? Yes No If No, describe Freddie Mac Form 70 March 2005 Page 1 of 6 Fannie Mae Form 1004 March 2005 Form 1004 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

11 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 2 of File 82 No Page #2 SALES COMPARISON APPROACH Uniform Residential Appraisal Report File # There are 14 comparable properties currently offered for sale in the subject neighborhood ranging in price from $ 400,000 to $ 689,000. There are 7 comparable sales in the subject neighborhood within the past twelve months ranging in sale price from $ 418,000 to $ 605,000. FEATURE SUBJECT COMPARABLE SALE # 1 COMPARABLE SALE # 2 COMPARABLE SALE # 3 Address Chiquita Chiquita 3511 Cutwater Pl 3405 Jolly Roger Circle Galveston, TX Galveston, TX Galveston, TX Galveston, TX Proximity to Subject 0.05 miles SW 9.69 miles NE 8.76 miles NE Sale Price $ n/a $ 418,000 $ 465,000 $ 550,000 Sale Price/Gross Liv. Area $ sq.ft. $ sq.ft. $ sq.ft. $ sq.ft. Data Source(s) Verification Source(s) MLS RC S/CAD Days on mkt. (DOM)--53 MLS RC S/CAD DOM--204 MLS RC S/CAD DOM--78 VALUE ADJUSTMENTS DESCRIPTION DESCRIPTION +(-) $ Adjustment DESCRIPTION +(-) $ Adjustment DESCRIPTION +(-) $ Adjustment Sales or Financing Concessions Date of Sale/Time Cash 3-11/4-11 Cash 7-11/7-11 mkt 5-11/6-11 Location Terramar Beach sim/lot $$$ sim/lot $$$ sim/lot $$$ Leasehold/Fee Simple Site View Design (Style) Quality of Construction Actual Age Condition Above Grade Fee Simple 5,003 SF/CAD gd/canal/bay resort good c 2005/5 yr eff good Total Bdrms. Baths Fee Simple 4,400 SF/inf sim/canal/bay resort/good similar/good c 2000/7 yr eff sim/good Total Bdrms. Baths Fee Simple +7,500 11,900 SF/sup sim/canal/bayou resort/good similar/good +6,000 c 2003/5 yr eff sim/good Total Bdrms. Baths Fee Simple -10,000 4,883 SF/sim sim/canal/bay resort/good similar/good c 1999/7 yr eff sup/features Total Bdrms. Baths +6,000-50,000 Room Count , , ,000 Gross Living Area 2,689 sq.ft. 1,769 sq.ft. +36,800 2,084 sq.ft. +24,200 2,802 sq.ft. -4,520 Basement & Finished Rooms Below Grade Functional Utility Heating/Cooling Energy Efficient Items Garage/Carport Porch/Patio/Deck n/a average furnace/central typ/stucco 1.5-car garage ext. deck/porch n/a sim/average furnace/central sim/hardiplank inf/no garage inf/deck/porch n/a sim/average furnace/central sim/vinyl siding +3,000 inf/1-car garage +10,000 sim/decks/porch n/a sim/average furnace/central sim/hardiplank +1,000 sup/2-car garage sim/deck/porch -1,000 other 2 outdoor bars inf/1 bar +7,500 inf/no bars +15,000 inf/1 bar area +7,500 other n/a grd lvl 1/2 bath -3,500 sup/fp -2,000 sup/fp -2,000 Asking Price n/a $449,000 $550K/$525K $429,000 Net Adjustment (Total) + - $ 77, $ 18, $ -49,020 Adjusted Sale Price Net Adj % Net Adj. 3.9 % Net Adj. 8.9 % of Comparables Gross Adj % $ 495,300 Gross Adj % $ 483,200 Gross Adj % $ 500,980 I did did not research the sale or transfer history of the subject property and comparable sales. If not, explain My research did did not reveal any prior sales or transfers of the subject property for the three years prior to the effective date of this appraisal. Data Source(s) CAD, MLS My research did did not reveal any prior sales or transfers of the comparable sales for the year prior to the date of sale of the comparable sale. Data Source(s) MLS/CAD Report the results of the research and analysis of the prior sale or transfer history of the subject property and comparable sales (report additional prior sales on page 3). ITEM SUBJECT COMPARABLE SALE #1 COMPARABLE SALE #2 COMPARABLE SALE #3 Date of Prior Sale/Transfer Price of Prior Sale/Transfer Data Source(s) Effective Date of Data Source(s) see below none none MLS/CAD none none MLS/CAD none none MLS/CAD Analysis of prior sale or transfer history of the subject property and comparable sales According to Galveston County Tax Records and the Galveston Central Appraisal District (CAD), the current owner of the subject property is Joel D. Salinas. This ownership has reportedly been in effect since February 2007 when the property was listed for $536,000 and sold for $510,000. The current CAD records are included in this report. At the date of inspection the property was not listed for sale. Summary of Sales Comparison Approach See attached. RECONCILIATION Indicated Value by Sales Comparison Approach $ 485,000 Indicated Value by: Sales Comparison Approach $ 485,000 Cost Approach (if developed) $ 507,687 Income Approach (if developed) $ The Cost Approach is also supportive of the Sales Comparison Approach. It is also my opinion the Income Approach is not applicable in this instance as although these properties are sometimes rented, most are owner-occupied and rental rates fluctuate greatly due to differing characteristics. This appraisal is made "as is", subject to completion per plans and specifications on the basis of a hypothetical condition that the improvements have been completed, subject to the following repairs or alterations on the basis of a hypothetical condition that the repairs or alterations have been completed, or subject to the following required inspection based on the extraordinary assumption that the condition or deficiency does not require alteration or repair: n/a Based on a complete visual inspection of the interior and exterior areas of the subject property, defined scope of work, statement of assumptions and limiting conditions, and appraiser s certification, my (our) opinion of the market value, as defined, of the real property that is the subject of this report is $ 485,000, as of October 10, 2011, which is the date of inspection and the effective date of this appraisal. Freddie Mac Form 70 March 2005 Page 2 of 6 Fannie Mae Form 1004 March 2005 Form 1004 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

12 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 3 of File 82 No Page #3 ADDITIONAL COMMENTS Uniform Residential Appraisal Report File # GENERAL MARKET CONDITIONS The overall state of the real estate market is best described as stable at this time. Much of the past activity had been centered around refinancing of existing mortgages as homeowners took advantage of lower interest rates. This trend had been revived in the past as interest rates had decreased but are now stabilized. Since Texas has approved home equity loans in 1998, this has also spurred loan activity. Primary residences require down payments of 3%-20%, depending on the borrower and the lending institution's policies. As the national prime interest rate is 3.25%, many institutions (banks) add anywhere from 1 to 2.5 percentage points over the prime rate to reflect risk and lending costs. Mortgage companies are offering different packages with creative terms and lower rates, but many include 1 or more discount points. There are, of course, exceptions to this rule, but this represents a general consensus of local lenders. The market has stabilized and even decreased, in some instances, since the early-mid 2006 time frame through current date with multiple reductions in asking prices being very common, as well as extended marketing periods. COMMENTS ON SALES COMPARISON Several comparable sales occurred near the subject in 2011 and are considered to be similar to the subject in reference to potential use, appeal and quality of construction. All of the sales are situated in similar subdivisions and have good locations or views, which carry a premium for such and the main adjustments were for the size, site size, effective age and bathroom. Galveston Island is a long narrow stretch of land and it is not uncommon for the comparable sales to be situated several miles away in similar resort subdivisions. Sale #1 occurred in April 2011 and is situated at Chiquita in Terramar Beach. It had a sale price of $418,000 ($236.29/SF). Positive adjustments were made for the smaller size (1,769 SF), the lesser bathroom count, inferior site size, lack of the extensive decking, outdoor bar count and the garage. The size adjustment was derived by applying a percentage of cost new times the difference in square footage. A negative adjustment was made for the grade level bathroom. The resulting adjusted sale price is $495,300. Sale #2 occurred in July 2011 and is situated at 3511 Cutwater Place in Pirates Cove. It had a sale price of $465,000 ($223.13/SF). Positive adjustments were made for the smaller size (2,084 SF), the garage and the outdoor bar areas. Negative adjustments were made for the superior site size and the fireplace. The resulting adjusted sale price is $483,200. Sale #3 is occurred in June 2011 and is situated at 3405 Jolly Roger Circle in Pirates Cove. It had a sale price of $550,000 ($196.29/SF). Negative adjustments were made for the larger size (2,802 SF), the garage, the greater bathroom count, the superior finish features and the fireplace. Positive adjustments were made for the inferior (older) effective age and the inferior outdoor bar area count. The resulting adjusted sale price is $500,980. The comparable sales, on a SF basis, have prices of $236.29, $ and $ The subject, with an estimated value of $485,000, has a per square foot value of $ Therefore, it is my opinion the market value of the subject, as is, as of the effective date of this appraisal, is as follows: FOUR HUNDRED EIGHTY FIVE THOUSAND DOLLARS ($485,000.00) In addition, there is currently an active listing at 4203 W. Bayside Way in Jamaica Beach currently listed for $489,500 reduced from $499,500 reduced from $520,000. It has been on the market for 674 days. This listing has 1,805 SF/2 bedrooms/2 baths/very good bay views/fp/2-car garage/electric storm shutters and is situated on 2 lots (12,000 SF). This listing has had many upgrades and has a bedroom and bath on the grade level (416 SF). COST APPROACH TO VALUE (not required by Fannie Mae) Provide adequate information for the lender/client to replicate the below cost figures and calculations. Support for the opinion of site value (summary of comparable land sales or other methods for estimating site value) Lot value estimated from sales of similar sites in the immediate area. Source used was the MLS. Lot 68, Chiquita sold in August 2010 for $140,000 with an asking price of $149,000 and was on the market for 47 days. COST APPROACH ESTIMATED REPRODUCTION OR REPLACEMENT COST NEW Source of cost data Marshall Valuation Quality rating from cost service good Effective date of cost data 2011 Comments on Cost Approach (gross living area calculations, depreciation, etc.) Cost new estimate obtained rom local builders and cost manual. Lot value obtained from comparison with nearby lot sales. Physical depreciation estimated at 8.33% with effective age estimated to be 5 years (5/60=8.33%) assuming proper care and maintenance. Site improvements at the right include the bulkhead, extensive decks/porches/balconies and boathouse. OPINION OF SITE VALUE =$ 140,000 DWELLING 2,689 $ =$ 363,015 n/a $ =$ =$ Garage/Carport 724 $ =$ 21,720 Total Estimate of Cost-New =$ 384,735 Less Physical Functional External Depreciation 32,048 =$( 32,048 ) Depreciated Cost of Improvements =$ 352,687 "As-is" Value of Site Improvements =$ 15,000 INCOME PUD INFORMATION Estimated Remaining Economic Life (HUD and VA only) 55 Years INDICATED VALUE BY COST APPROACH =$ 507,687 INCOME APPROACH TO VALUE (not required by Fannie Mae) Estimated Monthly Market Rent $ n/a X Gross Rent Multiplier n/a = $ Indicated Value by Income Approach Summary of Income Approach (including support for market rent and GRM) N/A PROJECT INFORMATION FOR PUDs (if applicable) Is the developer/builder in control of the Homeowners Association (HOA)? Yes No Unit type(s) Detached Attached Provide the following information for PUDs ONLY if the developer/builder is in control of the HOA and the subject property is an attached dwelling unit. Legal Name of Project n/a Total number of phases n/a Total number of units n/a Total number of units sold n/a Total number of units rented n/a Total number of units for sale n/a Data source(s) n/a Was the project created by the conversion of existing building(s) into a PUD? Yes No If Yes, date of conversion. n/a Does the project contain any multi-dwelling units? Yes No Data Source n/a Are the units, common elements, and recreation facilities complete? Yes No If No, describe the status of completion. n/a Are the common elements leased to or by the Homeowners Association? Yes No If Yes, describe the rental terms and options. n/a Describe common elements and recreational facilities. n/a Freddie Mac Form 70 March 2005 Page 3 of 6 Fannie Mae Form 1004 March 2005 Form 1004 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

13 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 4 of File 82 No Page #4 Uniform Residential Appraisal Report File # This report form is designed to report an appraisal of a one-unit property or a one-unit property with an accessory unit; including a unit in a planned unit development (PUD). This report form is not designed to report an appraisal of a manufactured home or a unit in a condominium or cooperative project. This appraisal report is subject to the following scope of work, intended use, intended user, definition of market value, statement of assumptions and limiting conditions, and certifications. Modifications, additions, or deletions to the intended use, intended user, definition of market value, or assumptions and limiting conditions are not permitted. The appraiser may expand the scope of work to include any additional research or analysis necessary based on the complexity of this appraisal assignment. Modifications or deletions to the certifications are also not permitted. However, additional certifications that do not constitute material alterations to this appraisal report, such as those required by law or those related to the appraiser s continuing education or membership in an appraisal organization, are permitted. SCOPE OF WORK: The scope of work for this appraisal is defined by the complexity of this appraisal assignment and the reporting requirements of this appraisal report form, including the following definition of market value, statement of assumptions and limiting conditions, and certifications. The appraiser must, at a minimum: (1) perform a complete visual inspection of the interior and exterior areas of the subject property, (2) inspect the neighborhood, (3) inspect each of the comparable sales from at least the street, (4) research, verify, and analyze data from reliable public and/or private sources, and (5) report his or her analysis, opinions, and conclusions in this appraisal report. INTENDED USE: The intended use of this appraisal report is for the lender/client to evaluate the property that is the subject of this appraisal for a mortgage finance transaction. INTENDED USER: The intended user of this appraisal report is the lender/client. DEFINITION OF MARKET VALUE: The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeably and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: (1) buyer and seller are typically motivated; (2) both parties are well informed or well advised, and each acting in what he or she considers his or her own best interest; (3) a reasonable time is allowed for exposure in the open market; (4) payment is made in terms of cash in U. S. dollars or in terms of financial arrangements comparable thereto; and (5) the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions* granted by anyone associated with the sale. *Adjustments to the comparables must be made for special or creative financing or sales concessions. No adjustments are necessary for those costs which are normally paid by sellers as a result of tradition or law in a market area; these costs are readily identifiable since the seller pays these costs in virtually all sales transactions. Special or creative financing adjustments can be made to the comparable property by comparisons to financing terms offered by a third party institutional lender that is not already involved in the property or transaction. Any adjustment should not be calculated on a mechanical dollar for dollar cost of the financing or concession but the dollar amount of any adjustment should approximate the market s reaction to the financing or concessions based on the appraiser s judgment. STATEMENT OF ASSUMPTIONS AND LIMITING CONDITIONS: subject to the following assumptions and limiting conditions: The appraiser s certification in this report is 1. The appraiser will not be responsible for matters of a legal nature that affect either the property being appraised or the title to it, except for information that he or she became aware of during the research involved in performing this appraisal. The appraiser assumes that the title is good and marketable and will not render any opinions about the title. 2. The appraiser has provided a sketch in this appraisal report to show the approximate dimensions of the improvements. The sketch is included only to assist the reader in visualizing the property and understanding the appraiser s determination of its size. 3. The appraiser has examined the available flood maps that are provided by the Federal Emergency Management Agency (or other data sources) and has noted in this appraisal report whether any portion of the subject site is located in an identified Special Flood Hazard Area. Because the appraiser is not a surveyor, he or she makes no guarantees, express or implied, regarding this determination. 4. The appraiser will not give testimony or appear in court because he or she made an appraisal of the property in question, unless specific arrangements to do so have been made beforehand, or as otherwise required by law. 5. The appraiser has noted in this appraisal report any adverse conditions (such as needed repairs, deterioration, the presence of hazardous wastes, toxic substances, etc.) observed during the inspection of the subject property or that he or she became aware of during the research involved in performing the appraisal. Unless otherwise stated in this appraisal report, the appraiser has no knowledge of any hidden or unapparent physical deficiencies or adverse conditions of the property (such as, but not limited to, needed repairs, deterioration, the presence of hazardous wastes, toxic substances, adverse environmental conditions, etc.) that would make the property less valuable, and has assumed that there are no such conditions and makes no guarantees or warranties, express or implied. The appraiser will not be responsible for any such conditions that do exist or for any engineering or testing that might be required to discover whether such conditions exist. Because the appraiser is not an expert in the field of environmental hazards, this appraisal report must not be considered as an environmental assessment of the property. 6. The appraiser has based his or her appraisal report and valuation conclusion for an appraisal that is subject to satisfactory completion, repairs, or alterations on the assumption that the completion, repairs, or alterations of the subject property will be performed in a professional manner. Freddie Mac Form 70 March 2005 Page 4 of 6 Fannie Mae Form 1004 March 2005 Form 1004 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

14 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 5 of File 82 No Page #5 Uniform Residential Appraisal Report File # APPRAISER S CERTIFICATION: The Appraiser certifies and agrees that: 1. I have, at a minimum, developed and reported this appraisal in accordance with the scope of work requirements stated in this appraisal report. 2. I performed a complete visual inspection of the interior and exterior areas of the subject property. I reported the condition of the improvements in factual, specific terms. I identified and reported the physical deficiencies that could affect the livability, soundness, or structural integrity of the property. 3. I performed this appraisal in accordance with the requirements of the Uniform Standards of Professional Appraisal Practice that were adopted and promulgated by the Appraisal Standards Board of The Appraisal Foundation and that were in place at the time this appraisal report was prepared. 4. I developed my opinion of the market value of the real property that is the subject of this report based on the sales comparison approach to value. I have adequate comparable market data to develop a reliable sales comparison approach for this appraisal assignment. I further certify that I considered the cost and income approaches to value but did not develop them, unless otherwise indicated in this report. 5. I researched, verified, analyzed, and reported on any current agreement for sale for the subject property, any offering for sale of the subject property in the twelve months prior to the effective date of this appraisal, and the prior sales of the subject property for a minimum of three years prior to the effective date of this appraisal, unless otherwise indicated in this report. 6. I researched, verified, analyzed, and reported on the prior sales of the comparable sales for a minimum of one year prior to the date of sale of the comparable sale, unless otherwise indicated in this report. 7. I selected and used comparable sales that are locationally, physically, and functionally the most similar to the subject property. 8. I have not used comparable sales that were the result of combining a land sale with the contract purchase price of a home that has been built or will be built on the land. 9. I have reported adjustments to the comparable sales that reflect the market's reaction to the differences between the subject property and the comparable sales. 10. I verified, from a disinterested source, all information in this report that was provided by parties who have a financial interest in the sale or financing of the subject property. 11. I have knowledge and experience in appraising this type of property in this market area. 12. I am aware of, and have access to, the necessary and appropriate public and private data sources, such as multiple listing services, tax assessment records, public land records and other such data sources for the area in which the property is located. 13. I obtained the information, estimates, and opinions furnished by other parties and expressed in this appraisal report from reliable sources that I believe to be true and correct. 14. I have taken into consideration the factors that have an impact on value with respect to the subject neighborhood, subject property, and the proximity of the subject property to adverse influences in the development of my opinion of market value. I have noted in this appraisal report any adverse conditions (such as, but not limited to, needed repairs, deterioration, the presence of hazardous wastes, toxic substances, adverse environmental conditions, etc.) observed during the inspection of the subject property or that I became aware of during the research involved in performing this appraisal. I have considered these adverse conditions in my analysis of the property value, and have reported on the effect of the conditions on the value and marketability of the subject property. 15. I have not knowingly withheld any significant information from this appraisal report and, to the best of my knowledge, all statements and information in this appraisal report are true and correct. 16. I stated in this appraisal report my own personal, unbiased, and professional analysis, opinions, and conclusions, which are subject only to the assumptions and limiting conditions in this appraisal report. 17. I have no present or prospective interest in the property that is the subject of this report, and I have no present or prospective personal interest or bias with respect to the participants in the transaction. I did not base, either partially or completely, my analysis and/or opinion of market value in this appraisal report on the race, color, religion, sex, age, marital status, handicap, familial status, or national origin of either the prospective owners or occupants of the subject property or of the present owners or occupants of the properties in the vicinity of the subject property or on any other basis prohibited by law. 18. My employment and/or compensation for performing this appraisal or any future or anticipated appraisals was not conditioned on any agreement or understanding, written or otherwise, that I would report (or present analysis supporting) a predetermined specific value, a predetermined minimum value, a range or direction in value, a value that favors the cause of any party, or the attainment of a specific result or occurrence of a specific subsequent event (such as approval of a pending mortgage loan application). 19. I personally prepared all conclusions and opinions about the real estate that were set forth in this appraisal report. If I relied on significant real property appraisal assistance from any individual or individuals in the performance of this appraisal or the preparation of this appraisal report, I have named such individual(s) and disclosed the specific tasks performed in this appraisal report. I certify that any individual so named is qualified to perform the tasks. I have not authorized anyone to make a change to any item in this appraisal report; therefore, any change made to this appraisal is unauthorized and I will take no responsibility for it. 20. I identified the lender/client in this appraisal report who is the individual, organization, or agent for the organization that ordered and will receive this appraisal report. Freddie Mac Form 70 March 2005 Page 5 of 6 Fannie Mae Form 1004 March 2005 Form 1004 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

15 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 6 of File 82 No Page #6 Uniform Residential Appraisal Report File # The lender/client may disclose or distribute this appraisal report to: the borrower; another lender at the request of the borrower; the mortgagee or its successors and assigns; mortgage insurers; government sponsored enterprises; other secondary market participants; data collection or reporting services; professional appraisal organizations; any department, agency, or instrumentality of the United States; and any state, the District of Columbia, or other jurisdictions; without having to obtain the appraiser s or supervisory appraiser s (if applicable) consent. Such consent must be obtained before this appraisal report may be disclosed or distributed to any other party (including, but not limited to, the public through advertising, public relations, news, sales, or other media). 22. I am aware that any disclosure or distribution of this appraisal report by me or the lender/client may be subject to certain laws and regulations. Further, I am also subject to the provisions of the Uniform Standards of Professional Appraisal Practice that pertain to disclosure or distribution by me. 23. The borrower, another lender at the request of the borrower, the mortgagee or its successors and assigns, mortgage insurers, government sponsored enterprises, and other secondary market participants may rely on this appraisal report as part of any mortgage finance transaction that involves any one or more of these parties. 24. If this appraisal report was transmitted as an electronic record containing my "electronic signature," as those terms are defined in applicable federal and/or state laws (excluding audio and video recordings), or a facsimile transmission of this appraisal report containing a copy or representation of my signature, the appraisal report shall be as effective, enforceable and valid as if a paper version of this appraisal report were delivered containing my original hand written signature. 25. Any intentional or negligent misrepresentation(s) contained in this appraisal report may result in civil liability and/or criminal penalties including, but not limited to, fine or imprisonment or both under the provisions of Title 18, United States Code, Section 1001, et seq., or similar state laws. SUPERVISORY APPRAISER S CERTIFICATION: The Supervisory Appraiser certifies and agrees that: 1. I directly supervised the appraiser for this appraisal assignment, have read the appraisal report, and agree with the appraiser s analysis, opinions, statements, conclusions, and the appraiser s certification. 2. I accept full responsibility for the contents of this appraisal report including, but not limited to, the appraiser s analysis, opinions, statements, conclusions, and the appraiser s certification. 3. The appraiser identified in this appraisal report is either a sub-contractor or an employee of the supervisory appraiser (or the appraisal firm), is qualified to perform this appraisal, and is acceptable to perform this appraisal under the applicable state law. 4. This appraisal report complies with the Uniform Standards of Professional Appraisal Practice that were adopted and promulgated by the Appraisal Standards Board of The Appraisal Foundation and that were in place at the time this appraisal report was prepared. 5. If this appraisal report was transmitted as an "electronic record" containing my "electronic signature," as those terms are defined in applicable federal and/or state laws (excluding audio and video recordings), or a facsimile transmission of this appraisal report containing a copy or representation of my signature, the appraisal report shall be as effective, enforceable and valid as if a paper version of this appraisal report were delivered containing my original hand written signature. APPRAISER Signature Name Steve Hughes Company Name Bay Area Real Property Appraisers Company Address 1802 Broadway, Suite 212, Galveston, TX Telephone Number (409) Address bayapp10@aol.com Date of Signature and Report October 21, 2011 Effective Date of Appraisal October 10, 2011 State Certification # TX G or State License # or Other (describe) State # State TX Expiration Date of Certification or License 1/31/2012 ADDRESS OF PROPERTY APPRAISED Chiquita Galveston, TX APPRAISED VALUE OF SUBJECT PROPERTY $ 485,000 LENDER/CLIENT Name Company Name Steve Harr Company Address 700 Louisiana St., Ste Houston, TX Address SUPERVISORY APPRAISER (ONLY IF REQUIRED) Signature Name n/a Company Name Company Address Telephone Number Address Date of Signature State Certification # or State License # State Expiration Date of Certification or License SUBJECT PROPERTY Did not inspect subject property Did inspect exterior of subject property from street Date of Inspection Did inspect interior and exterior of subject property Date of Inspection COMPARABLE SALES Did not inspect exterior of comparable sales from street Did inspect exterior of comparable sales from street Date of Inspection Freddie Mac Form 70 March 2005 Page 6 of 6 Fannie Mae Form 1004 March 2005 Form 1004 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

16 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 7 of File 82 No Building Sketch Borrower/Client n/a Property Address City Chiquita Galveston County Galveston State TX Zip Code Lender Steve Harr Page #7 5.5' 17.8' 5.5' 14.5' 47' 23.7' 33.5' 47' 3' 23.9' 16.5' 18' 34.3' 3.5' 34.3' Form SKT.BldSkI "WinTOTAL" appraisal software by a la mode, inc ALAMODE

17 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 8 of File 82 No Flood Map Borrower/Client n/a Property Address City Chiquita Galveston County Galveston State TX Zip Code Lender Steve Harr Page #8 Form MAP.FLOOD "WinTOTAL" appraisal software by a la mode, inc ALAMODE

18 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 9 of File 82 No Subject Photo Page Borrower/Client n/a Property Address City Chiquita Galveston County Galveston State TX Zip Code Lender Steve Harr Page #9 Subject Front Chiquita Sales Price n/a Gross Living Area 2,689 Total Rooms 10 Total Bedrooms 5 Total Bathrooms 3 Location Terramar Beach View gd/canal/bay Site 5,003 SF/CAD Quality good Age c 2005/5 yr eff Subject Rear Subject Street Form PIC3x5.SR "WinTOTAL" appraisal software by a la mode, inc ALAMODE

19 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 10 File of No PHOTOGRAPH ADDENDUM Borrower/Client n/a Property Address City Chiquita Galveston County Galveston State TX Zip Code Lender Steve Harr Page #10 View of the grade level bar area. View of outdoor kitchen. View of the outdoor bar area on grade level. Form GPIC3X5 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

20 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 11 File of No Photograph Addendum Borrower/Client n/a Property Address City Chiquita Galveston County Galveston State TX Zip Code Lender Steve Harr Page #11 View of the boathouse and boatlift and jetski lifts. View of the bay from the subject deck. View of the deck area on the 3rd floor. Form GPIC3X5 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

21 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 12 File of No Photograph Addendum Borrower/Client n/a Property Address City Chiquita Galveston County Galveston State TX Zip Code Lender Steve Harr Page #12 View of the canal from the subject deck. Interior view of kitchen. Interior view of a bath. Form GPIC3X5 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

22 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 13 File of No Photograph Addendum Borrower/Client n/a Property Address City Chiquita Galveston County Galveston State TX Zip Code Lender Steve Harr Page #13 View of a bedroom. Interior view of a bar area with stairwell in the background. View of the living area. Form GPIC3X5 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

23 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 14 File of No Photograph Addendum Borrower/Client n/a Property Address City Chiquita Galveston County Galveston State TX Zip Code Lender Steve Harr Page #14 Interior view of stairwell. Interior view of a bedroom. Interior view of a bathroom. Form GPIC3X5 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

24 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 15 File of No Photograph Addendum Borrower/Client n/a Property Address City Chiquita Galveston County Galveston State TX Zip Code Lender Steve Harr Page #15 Interior view of a bathroom. View of stairwell and 2nd floor as seen from the 3rd floor. Form GPIC3X5 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

25 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 16 File of No Comparable Photo Page Borrower/Client n/a Property Address City Chiquita Galveston County Galveston State TX Zip Code Lender Steve Harr Page #16 Comparable Chiquita Prox. to Subject 0.05 miles SW Sale Price 418,000 Gross Living Area 1,769 Total Rooms 6 Total Bedrooms 3 Total Bathrooms 2 Location sim/lot $$$ View sim/canal/bay Site 4,400 SF/inf Quality similar/good Age c 2000/7 yr eff Comparable Cutwater Pl Prox. to Subject 9.69 miles NE Sale Price 465,000 Gross Living Area 2,084 Total Rooms 7 Total Bedrooms 4 Total Bathrooms 4 Location sim/lot $$$ View sim/canal/bayou Site 11,900 SF/sup Quality similar/good Age c 2003/5 yr eff Comparable Jolly Roger Circle Prox. to Subject 8.76 miles NE Sale Price 550,000 Gross Living Area 2,802 Total Rooms 6 Total Bedrooms 3 Total Bathrooms 3.5 Location sim/lot $$$ View sim/canal/bay Site 4,883 SF/sim Quality similar/good Age c 1999/7 yr eff Form PIC3x5.CR "WinTOTAL" appraisal software by a la mode, inc ALAMODE

26 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 17 File of No Location Map Borrower/Client n/a Property Address City Chiquita Galveston County Galveston State TX Zip Code Lender Steve Harr Page #17 Form MAP.LOC "WinTOTAL" appraisal software by a la mode, inc ALAMODE

27 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 18 File of No Page #18 Form SC1 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

28 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 19 File of No Page #19 Form SC1 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

29 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 20 File of No Page #20 Form SC1 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

30 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 21 File of No Page #21 Form SC1 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

31 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 22 File of No Page #22 Form SC1 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

32 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 23 File of No Page #23 Form SC1 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

33 Case 4:11-cv Document Filed in TXSD on 08/08/14 Page Main 24 File of No Page #24 Form SC1 "WinTOTAL" appraisal software by a la mode, inc ALAMODE

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