HOLLAND HART LLP · 5/7/2013 · 2 property known as Phase II of the Stonebrook Apartments also...

HOLLAND & HART LLP David K. Broadbent, #0442 Matthew T. Wirthlin, #8291 Romaine C. Marshall, #9654 J. Andrew Sjoblom, #10860 Doyle S. Byers, #11440 Cory A. Talbot, #11477 222 S. Main Street, Suite 2200 Salt Lake City, UT 84101 Telephone: 801-799-5800 Fax: 801-713-6259 Attorneys for John A. Beckstead as Receiver

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF UTAH, CENTRAL DIVISION

SECURITIES AND EXCHANGE COMMISSION, Plaintiff, vs. MANAGEMENT SOLUTIONS, INC., a Texas Corporation; WENDELL A. JACOBSON; ALLEN R. JACOBSON, Defendants.

MOTION TO APPOINT APPRAISERS

REGARDING SALE OF PROPERTY OF STONE BROOK IDAHO, LLC, AND

TETONIAN PROPERTIES, LLC

Civil Action No. 2:11-cv-01165 Judge Bruce S. Jenkins

John A. Beckstead, the Court-appointed receiver in this matter (the “Receiver”), hereby

moves the Court to appoint appraisers.

I. INTRODUCTION

Stone Brook Idaho, LLC, a Receivership entity, is the owner of real property known as

Phase I of the Stonebrook Apartments located at 600 Pioneer Road, Rexburg, Idaho 83440, and

Tetonian Properties, LLC, another Receivership entity, has a tenant-in-common interest in real

Case 2:11-cv-01165-BSJ Document 1078 Filed 05/07/13 of 14

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property known as Phase II of the Stonebrook Apartments also located at 600 Pioneer Road,

Rexburg, Idaho 83440 (collectively, the “Stonebrook Properties”).1 The Receiver requests an

order confirming the appointment of independent appraisers as required by 28 U.S.C. § 2001 to

assist the Court and the Receiver in valuing the Stonebrook Properties.

II. MEMORANDUM

The Order authorizes and directs the Receiver to take control of Defendants’ assets, and,

“[u]pon further Order of this Court, pursuant to such procedures as may be required by this Court

and additional authority such as 28 U.S.C. §§ 2001 and 2004, the Receiver will be authorized to

sell, and transfer clear title to, all real property in the Receivership Estates.” (Order [Doc. 4] at

14 ¶ 40.) In relevant part, Section 2001(b) provides, “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.”

The Order also contemplates that the Receiver would employ professionals to assist him in

discharging his duties:

To engage and employ persons in his discretion to assist him in carrying out his duties and responsibilities hereunder, including, but not limited to, accountants, attorneys, securities traders, registered representatives, financial or business advisers, liquidating agents, real estate agents, forensic experts, brokers, traders or auctioneers[.]

(Id. at 4-5 ¶ 8(F).)

Consistent with these provisions, the Receiver has requested three professional and

disinterested appraisers – Darrin W. Liddell of Integra Realty Resources, Gary R. Free of Gary

Free and Associates, Inc., and Bob Brown of CBRE, Inc. – to provide appraisals to assist the

1 (See Order Appointing Receiver, Freezing Assets & Other Relief [Doc. 4] (the “Order”), Ex. A thereto (identifying Stone Brook Idaho, LLC, and Tetonian Properties, LLC, as Receivership entities).)


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Court and the Receiver in valuing the Stonebrook Properties. To comply with the requirements

of Section 2001(b), the Receiver requests that the Court confirm the appointment of Mr. Liddell,

Mr. Free, and Mr. Brown. Each of these appraisers is a reputable professional and state-certified

appraiser, and attached hereto are the credentials and certification for these appraisers, as well as

the Receiver’s proposed agreement with each:

Engagement Letter with Mr. Free (Ex. A);

Resume of Mr. Free (Ex. B);

License of Mr. Free (Ex. C);

Engagement Letter with Mr. Liddell (Ex. D);

Resume of Mr. Liddell (Ex. E);

License of Mr. Liddell (Ex. F);

Engagement Letter with Mr. Brown (Ex. G);

Resume of Mr. Brown (Ex. H); and

License of Mr. Brown (Ex. I).

The Receiver does not request oral argument on this Motion.

III. CONCLUSION

Based upon the foregoing, the Receiver requests that the Court grant his Motion to

Appoint Appraisers Regarding Sale of Property of Stone Brook Idaho, LLC, and Tetonian

Properties, LLC.


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RESPECTFULLY SUBMITTED this 7th day of May, 2013.

HOLLAND & HART LLP /s/ Cory A. Talbot David K. Broadbent Matthew T. Wirthlin Romaine C. Marshall J. Andrew Sjoblom Doyle S. Byers Cory A. Talbot

Attorneys for John A. Beckstead as Receiver


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CERTIFICATE OF SERVICE

I hereby certify that on the 7th day of May, 2013, I caused a true and correct copy of the

foregoing to be served in the following manner upon the addressee(s) listed below:

U.S.Mail,postageprepaid HandDelivery Facsimile Overnightcourier E‐mailand/orCM/ECF

DanielJ.WadleyThomasM.MeltonAlisonJ.OkinakaPaulN.FeindtSECURITIES&EXCHANGECOMMISSION15W.SouthTempleStreet,Suite1800SaltLakeCity,UT84101Telephone:(801)524‐5796Facsimile:(801)524‐[email protected]@[email protected]@sec.govAttorneysforSecuritiesandExchangeCommission


GregB.BaileyP.O.Box298FountainGreen,UT84632Telephone:(435)262‐7683ProSe


GregoryN.HooleHOOLE&KINGL.C.4276HighlandDriveSaltLakeCity,UT84124Telephone:(801)272‐7556Facsimile:(801)272‐[email protected]


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KimR.WilsonTammyB.GeorgelasSNOWCHRISTENSEN&MARTINEAU10ExchangePlace,11thFloorP.O.Box45000SaltLakeCity,UT84145‐5000Telephone:(801)521‐9000Facsimile:(801)363‐[email protected]@scmlaw.comAttorneysforBankMidwestN.A.,assuccessor‐by‐mergerwithHillcrestBank,N.A.


StephenE.QuesenberryChristopherR.InfangerDURHAMJONES&PINEGARRiverViewPlaza,Suite3004844North300WestProvo,UT84604Telephone:(801)375‐6600Facsimile:(801)375‐[email protected]@djplaw.comAttorneysforDefendants,WendellA.JacobsonandAllenR.Jacobson


SamM.StricklinBrianC.MitchellBRACEWELL&GIULIANI,LLP1445RossAvenue,Suite3800Dallas,TX75202Telephone:(214)758‐1053Facsimile:(214)468‐[email protected]@bgllp.comAttorneysforBankMidwestN.A.,assuccessor‐by‐mergerwithHillcrestBank,N.A.


AdelaideMaudsleyBrandonC.PondCHAPMANANDCUTLER,LLP201S.MainStreet,Suite2000SaltLakeCity,UT84111Telephone:(801)533‐[email protected]@chapman.comAttorneysforMutualofOmahaBank


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JohnP.KincadeDeannaE.CaldwellJamesRichardWhiteWINSTEADPC500WinsteadBuilding2728N.HarwoodStreetDallas,TX75201Telephone:(214)745‐5400Facsimile:(214)745‐[email protected]@[email protected]


D.ZacharyWisemanRAYQUINNEY&NEBEKER,P.C.36S.StateStreet,Suite1400P.O.Box45385SaltLakeCity,UT84145‐[email protected]


GeorgeW.PrattJessicaP.WildeJONESWALDOHOLBROOK&MCDONOUGH170S.MainStreet,Suite1500SaltLakeCity,UT84101Telephone:(801)521‐[email protected]@joneswaldo.comAttorneysforBarlowCorporation


DouglasM.DurbanoJacobD.BriggsDURBANOLAWFIRM,P.C.476W.HeritageParkBlvd.,Suite200Layton,UT84041Telephone:(801)776‐[email protected]


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AmyF.SorensonJaredC.FieldsSNELL&WILMERL.L.P.15W.SouthTemple,Suite1200SaltLakeCity,UT84101Telephone:(801)257‐[email protected]@swlaw.comAttorneysforFannieMae


JasonD.BorenMatthewL.MoncurBALLARDSPAHRLLPOneUtahCenter,Suite800201S.MainStreetSaltLakeCity,UT84111‐2221Telephone:(801)531‐[email protected]@ballardspahr.comAttorneysforFreddieMac


EdwinJ.TomkoJasonM.RossCURRANTOMKOTARSKILLP2001BryanTower,Suite2000Dallas,TX75201Telephone:(214)270‐[email protected]@cttlegal.comAttorneysforBrianBlain,VisionaryManagement,FirstBranchandEncinitoProperties


JohnH.BogartTELOSVENTURESGROUP299S.MainStreet,Suite1300SaltLakeCity,UT84111Telephone:(801)535‐[email protected],VisionaryManagement,FirstBranchandEncinitoProperties


9


KennethL.Cannon,IIStevenJ.McCardellDURHAMJONES&PINEGAR111E.Broadway,Suite900SaltLakeCity,UT84111Telephone:(801)415‐[email protected]@djplaw.comAttorneysforKeyBank


JohnL.YoungJeremyM.HoffmanYOUNGHOFFMANLLC170S.MainStreet,Suite1125SaltLakeCity,UT84101‐1605Telephone:(801)359‐[email protected]@yahlaw.comAttorneysforArvestBank


PhilipD.HixonR.CharlesWilkinRobertS.GlassRobertP.SkeithGLASSWILKINPC1515S.Utica,Suite250Tulsa,OK74014Telephone:(918)582‐[email protected]@[email protected]@glasswilkin.comAttorneysforArvestBank


MatthewN.EvansGregoryS.RobertsRAYQUINNEY&NEBEKER36S.StateStreet,Suite1400P.O.Box45385SaltLakeCity,UT84145‐0385Telephone:(801)521‐[email protected]@rqn.comAttorneysforNevadaStateBank


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JeffreyE.NelsonU.S.ATTORNEY’SOFFICE185S.StateStreet,Suite300SaltLakeCity,UT84111Telephone:(801)325‐3250jeff.nelson@usdoj.govAttorneysforDepartmentofHousingandUrbanDevelopment


MatthewC.BarneckWayneZ.BennettRICHARDSBRANDTMILLERNELSONWellsFargoCenter,15thFloor299S.MainStreetP.O.Box2465SaltLakeCity,UT84110‐2465matthew‐[email protected]‐[email protected]


J.ScottBrownStevenC.StrongPARSONSKINGHORNHARRIS111E.Broadway,11thFloorSaltLakeCity,UT84111Telephone:(801)363‐[email protected]@pkhlawyers.comAttorneysforCentralBank


MarkR.GaylordMatthewL.MoncurBALLARDSPAHRLLPOneUtahCenter,Suite800201S.MainStreetSaltLakeCity,UT84111‐2221Telephone:(801)531‐[email protected]@ballardspahr.comAttorneysforU.S.BankNationalAssociationasTrustee,assuccessorininteresttoBankofAmerica,NationalAssoc.,assuccessorbymergertoLaSalleBankNationalAssoc.fortheregisteredholdersofLB‐UBSCommercialMortgageTrust2005‐C7,CommercialMortgagePass‐ThroughCert,Series2005‐C7


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JosephCoveyRobertS.ClarkRoyceB.CovingtonPARRBROWNGEE&LOVELESS185S.StateStreet,Suite800SaltLakeCity,UT84111Telephone:(801)532‐[email protected]@parrbrown.comrcovington@parrbrown.comAttorneysforC.EugeneMcDermott,MaryAnnMcDermott,ForestHillsApartments,McKeanEnterprises,EricClarkWelling,MaryKatherineWelling,PheasantWoodandNycomApartments


StevenW.CallRAYQUINNEY&NEBEKER36S.StateStreet,Suite1400P.O.Box45385SaltLakeCity,UT84145‐0385Telephone:(801)532‐[email protected]


MarkWilsonWilliamsSHERMAN&HOWARDLLC633SeventeenthStreet,Suite3000Denver,CO80202Telephone:(303)299‐[email protected]


HeidiG.Goebel(10343)EricK.Jenkins(10783)CHRISTENSEN&JENSEN,P.C.15W.SouthTemple,Suite800SaltLakeCity,UT84101Telephone:(801)323‐5000Facsimile:(801)355‐[email protected]@chrisjen.comAttorneysforBranchBanking&Trust


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ScottA.ShanesJulieK.BiermacherSTRASBURGER&PRICE,LLP2801NetworkBlvd.,Suite600Frisco,TX75034Telephone:(469)287‐3900Facsimile:(469)287‐[email protected]@strasburger.comAttorneysforBranchBanking&Trust


ScottA.CummingsStevenT.WatermanDORSEY&WHITNEY136S.MainStreet,Suite1000SaltLakeCity,UT84101‐1685Telephone:(801)933‐[email protected]@dorsey.comAttorneysforU.S.BankNationalAssociation


AshtonJ.HydeDavidR.HagueFABIAN&CLENDENIN215S.StateStreet,Suite1200SaltLakeCity,UT84111‐2323Telephone:(801)323‐[email protected]@fabianlaw.comAttorneysforJohnA.Beckstead


MarkF.James(5295)HATCH,JAMES&DODGE,P.C.10W.Broadway,Suite400SaltLakeCity,UT84101Telephone:(801)363‐6363Facsimile:(801)363‐[email protected]‐C1KengaryWay,LLCCFCRE2011‐C2HeatherbridgeLane,LLCCRCRE2011‐C1Apartments12900,LLC


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M.ScottBarnardAlanM.HayesHeatherL.PeckhamAKINGUMPSTRAUSSHAUER&FELD,LLP1700PacificAvenue,Suite4100Dallas,[email protected]@akingump.comhpeckham@akingump.comAttorneysforProposedIntervenorsCFCRE2011‐C1KengaryWay,LLCCFCRE2011‐C2HeatherbridgeLane,LLCCRCRE2011‐C1Apartments12900,LLC


LonA.JenkinsJONESWALDOHOLBROOK&MCDONOUGH170S.MainStreet,Suite1500SaltLakeCity,UT84101Telephone:(801)521‐[email protected]


MatthewC.BarneckRussellC.FericksChadE.FunkRICHARDSBRANDTMILLERNELSONWellsFargoCenter,15thFloor299S.MainStreetP.O.Box2465SaltLakeCity,UT84110‐2465matthew‐[email protected]‐[email protected]‐[email protected],JillR.Nielson,andBlackCliffsInvestments,LLC


14


LonA.JenkinsNathanD.ThomasJONESWALDOHOLBROOK&MCDONOUGH170S.MainStreet,Suite1500SaltLakeCity,UT84101Telephone:(801)521‐[email protected]@joneswaldo.comAttorneysforIntervenorPlaintiffUS.BankNationalAssociation,asTrusteefortheRegisteredHoldersofCD2007‐CD4CommercialMortgageTrust,CommercialMortgagePass‐ThroughCertificates,SeriesCD2007‐CD4,actingbyandthroughitsSpecialServicerCWCapitalAssetManagementLLC


HeatherDeansFoley,Esq.(admittedprohacvice)VENABLELLP750E.PrattStreet,Suite900Baltimore,MD21202Telephone:(410)244‐7400Facsimile:(410)244‐7742hdfoley@venable.comAttorneysforIntervenorPlaintiffUS.BankNationalAssociation,asTrusteefortheRegisteredHoldersofCD2007‐CD4CommercialMortgageTrust,CommercialMortgagePass‐ThroughCertificates,SeriesCD2007‐CD4,actingbyandthroughitsSpecialServicerCWCapitalAssetManagementLLC


DanielM.BenjaminBALLARDSPAHRLLP655W.Broadway,Suite1600SanDiego,CA92101Telephone:(619)696‐[email protected]@ballardspahr.comAttorneysforU.S.BankNationalAssociationasTrustee,assuccessorininteresttoBankofAmerica,NationalAssoc.,assuccessorbymergertoLaSalleBankNationalAssoc.fortheregisteredholdersofLB‐UBSCommercialMortgageTrust2005‐C7,CommercialMortgagePass‐ThroughCert,Series2005‐C7

6175183_1.DOCX


P_Howell

Typewritten Text

/s/ Tish Howell

P_Howell

Typewritten Text

EXHIBIT A

Case 2:11-cv-01165-BSJ Document 1078-1 Filed 05/07/13 Page 1 of 4

February 27,2013

Scott Miller [email protected]

FreeanclAssociates. Inc. REAL ESTATE APPRAISERS I CONSULTANTS

Subject: Appraisal ofthe Stonebrook Apartments located at 600 Pioneer Road, Rexburg, Idaho.

Dear Mr. Miller:

Thank you for allowing Free and Associates to give you a bid to perform a complete summary appraisal of the above referenced properties. The scope of the appraisal will be of the 240 units as a full complex with a conclusion for the division of the contribution to value for the two separate sections. The fee for this assignment will be $3,950 with a turnaround time of three weeks. We would like to receive a 50% retainer ($1,975) to begin the process.

If you agree with these terms, please sign below and return a copy of this engagement letter. If you have any questions concerning this appraisal bid, please feel free to contact us, We look forward to working with you on this assignment.

i;;t Gar~. Free, MAl, SRA President Free and Associates, Inc.

TETON IAN PROPERTIES, LLC By: ------------------------

John A. Beckstead, not in his individual capacity

buy solely in his capacity as court appointed

Receiver for Tetonian Properties, LLC xxxxxxxxxxxxxxxxxxxxx S()0W:MlPf€rX

2-27-02 STONE BROOK IDAHO, LLC By: --------------------------

John A. Beckstead, not in his individual capacity but solely in his capacity as court appointed Receiver for Stone Brook Idaho, LLC

1100 East 6600 South, Suite 201 / Salt Lake City, Utah 84121 I p- (801) 262-3388/ F- (801) 2.6;>'-7893

www.freeandassociates.com


ADDENDUM #1 TO LETTER AGREEMENT

(Stonebrook Idaho)

This Addendum #1 (this "Addendum") is an addendum to and forms a part of that certain Letter Agreement (the "Agreement"), dated February 27, 2013, entered into by and between Gary R. Free, MAl, SRA ("Appraiser") on behalf of Free and Associates, Inc. ("Company"), and John A. Beckstead, not in his individual capacity but solely as the Court-appointed Receiver ("Receiver") for Stone Brook Idaho, LLC ("Stonebrook Idaho Phase I Owner") and Tetonian Properties, LLC, an Idaho limited liability company ("Stonebrook Idaho Phase II Owner," and together with Stonebrook Idaho Phase I Owner, collectively, the "Owner"), in Case No. 2:11-CV-01165 in the United States District Court for the District of Utah ("Court"), entitled Securities Exchange Commission v. Management Solutions, Inc., et al. ("SEC Action"), for the appraisal (the "Appraisal") of certain real property identified in the Agreement and more particularly described in Exhibit A attached hereto (the "Phase I Property") and Exhibit B attached hereto (the "Phase II Property," and together with the Phase I Property, collectively, the "Property"). Stonebrook Idaho Phase I Owner owns a 51 % interest in the Phase I Property. Stonebrook Idaho Phase II Owner is the . fee owner of the Phase II Property. The parties hereto agree further as follows:

1. All references in the Agreement to "Scott Miller" or "Mr. Miller" are hereby deleted and replaced with "Owner".

2. The Appraiser acknowledges and agrees that the intended user of the appraisal is both the Receiver and the Court.

3. The Appraiser acknowledges and agrees that the intended use of the Appraisal includes a) internal decision making, b) presentation to prospective buyers of the property for informational purposes, and c) and presentation to the Court or otherwise in connection with Court proceedings.

4. Appraiser and Receiver agree that each party will hold the other harmless from and against any liability, cost or expense (including attorneys' fees) arising out of any claim or legal proceeding brought by a third party where such claim or legal proceeding is based on the negligent act or omission, or misconduct of the other party.

5. Appraiser and Receiver agree that possession of the Appraisal, or a copy thereof, does not carry with it the right of publication, and the Appraisal may not be used by any person or organization except the client without the previous written consent of the Appraiser, and then only in its entirety; provided, however, the Receiver is permitted to present the report to the Court and to prospective buyers of the Property for informational purposes. If the Receiver releases or disseminates the Appraisal to others without the consent of the Appraiser, the client hereby agrees to hold the Appraiser hannless from any liability, damages, or losses which the Appraiser might suffer, for any reason whatsoever, by reason of dissemination of the report by the Receiver. However, nothing herein shall prohibit the Receiver or Appraiser from disclosing said report or opinions contained therein as may be required by applicable law.

1


6. If a party shall commence any action or proceeding against another party in order to enforce the provisions of the Agreement or to recover damages as a result of the alleged breach of any of the provisions of the Agreement, the prevailing party shall be entitled to recover from the other party all reasonable costs in connection therewith, including reasonable attorneys' fees.

7. To the extent that the terms of this Addendum modify or conflict with any provisions of the Agreement, then these terms control. All other terms of the Agreement not modified by this Addendum shall remain unchanged in full force and effect.

DATED this _ day of April, 2013.

STONE BROOK IDAHO, LLC

By: ____________________ _

John A. Beckstead, not in his individual capacity but solely in his capacity as court appointed Receiver for Stone Brook Idaho, LLC


By: ________________ __

John A. Beckstead, not in his individual capacity but solely in his capacity as court appointed Receiver for Tetonian Properties, LLC

By: ____ ~'f---------Name: Gar Title: President

2


EXHIBITB


GARY R. FREE, MAL, SRA Freo and Associ ates, Inc .

. !."iITRODUCTION

Sitw" 1916, Gn:ryFrec: 11m; b~n the: O\'r'J1or (lntf manager of FI\:>C mkl. A,Kl;ocilllc:s. Inc., n Ten] c~flUc Ilppnli..~illg Imd cOTlsllltillg!intl. His e"'Pel'f~'I1eC C'tlCPOlpaSiBell nil I'I1C/$ of corrm10rcia! nnd re~identitll ~11I estlite, wilh 1l1l1phlUtis onretnit. o:llloo, indl.Lqtrial. $~Ihdivision nnu multir'llOlily dovclopnwIl1:s~ Mr. l!ree hIlS 8t'rvL>d in ~.cx:h:d oniC'l$ 1md 01)

buurds of profc:lt.lIinnn/, ol1l~lliUl1.iollll such Ilslhc l\pprnisuJ ·fmlti1u1c:· and Lhe Society (lr Re~ll EstUle Appro iliCl~. lie is lioenscd in Ulllh. Wyoming. Idllho lind Nevndll. find hus pl'Uvided expert tustimony in U.S. And Dil>1rict oourtli.

DESU;fNA"110NS AND UCENSE8

Bachelor of Arts. Degreo in .13l11lJm:!;8 ManaWilment UllwCl!J)ity of Ut:th MAl (Member Apfll'alll'Llt Institute) DlllIi,gontinll n:urfibC'I' 7272 SRPA (Society f}f R.m1.Eiame Appmiser) fx.cbQlt~tl for SRA (IlOn''''Ompeting de&ignatian) 4S Ii re~ult ormcrger SM (S<:l1io.r R':l!i<lcnlilll Apl'r'.tiser. Appm;"III, Inf(fllut.~) Certified Qcnllr<ll Appraiser. t.lJl1h Certified Oener.nl Appru~Cf. Wyoming Certified (lenl'1'1I1 APPl'lI.i);cr. !dnho CC11i1kd Gcmcml Appmisr:r. Ncvndll

PRm1~SSJ()NAL SElWICE

Prcsj·denl. Appm.islll In~'iltfle. VIIIII Clulptcr

Penni! 1185 Num[)cr COA·I25 UIXlO!'C rl{IJ002

Pro..~ictallt. Sodoty of R..,a.l Esllit~ Appnltron;. 8011 Luke City ('hnp:ter Rllgionlll R.15flrO'5I!'Htnll "iI. A pprnis.al1n~tjlutCl i::l."e(.mtlvQ BQurd Membor, Appmis61 Jn~1ilUto, [ltah Chaplor ?re8idi.'nt. lJl:ll, Sl}tf.St<mlgc Assol.-iali11l1 Vic.\) l'ccsidllnlllnd Director. Sod"ty of.R.ml £::stato Apl'nlis~m. 51tlt tuke City Chapter BOllrd Member. Soci~ of Relll ES'm~ Al'Pl'llis\l!'!\. Sail !..Me City Cl' llpti:r CtHl.imHIO.l'\:·"Pr>flIi~J proj.::~'tlbf11~t3uNln\l or .EcMomic Reliell,rch, 1jllivcl'l'i1), urlJtlln Memb"l'. In'Ilf.!\l'lioAl\.IR.i8ht,"f.W~ Al'i~ociRti!:ln Member. SouthwCJi( Rilgioo Review and COlJllSaii'l1g Cotnnlitttll, Appmisnllnl'tinr.te Mc:mhc::r. NOIlI'C$id"'l1tinl f)ernoTh~ll1iti\ln Rc.<p(~rt Gmding Pund. l\ppnti1>:llll1:!llilul:c

1100 fvWr ((',()(l SOlJ'IlI; Sutre201 " SAU :I...1I.KE eny, [lj !l1l1:!1 (EOn Jlti2,33Rlt " fPllYr(iJfi\lcl\l\d&:tI('...:ioIc$CQffi


FO\1l\(kr. in J97f> orFr~ lind A!lfDcll1~s. 11 full-s;)rvfcc real <Jstate npprnisalamd cUlIlCullIug filln. Pre~ldcul and ,.nalHI&ICr of this finn until flMlcnt. QWllIfi:c;<\.,. t.hrough oht.nining llJlpmprlntc educnHOll1illd ;!)..l>vrieIlQe, 10 complet.;! Ill'prni»~bI nnd provide ~~llsllhin~ s.::rvi11" 01'1 al IlYPes of conH\\.Crdal nod r<lddvntia I pl'opetl j~s, many ofwhicb ~N indtldcd in the fdllowtng j'IIttttll.llb't.

• Rull1i!.: :ncighl>orhood oonl1).r>i to ri1giollllill1l1l'1s • Hilt:etll IIl1d motels • Rcstllural'lt& • Varlolls cmltnltll'dnl dc·"e1opm~nJ9: ",,;,lr.stol11g1t fl\cjJi.ties, conv;')ni6nc~ KtOI'e.s.,

rltn<llli ccH1te-rs. ·mllo delllershlp .... al'I~O l'epair shops. cllrwlls!l .. 'lI. hist()nc bl.1ttdi.llgll • otUtx' buildings .and l'Ompl.;\'xC'lI • Offi\l.\lO'wlIl'o.l!otlsc cOIllp:lcx<ilS. disllibilliol'lllild manufllcturlng oomcn; • Eminent. (1)1118111; n\l,d: wid..,nin,g, ollwr prop ... rty ~\"nlllli(m~ • lh:so'f't: propeltie~ • Res.idel1tinl pro pelt jell: condl)minium end JtIl:trtrn~llls cOlTlplvx""",1Iingl;c·fnmily

homes • Subdivisions • R~w hmd ill Re.l."IriC'live Il'lC .:w;cm<mb;

1»76 - Pl'~"'llt In&~J9g0:

1974-1916;

.Prosidel1t, me mld f\.s:1locim~. Inc. President; Capilnl Land M~mcnt, Inc. Comm~rciaJ undl'\.~id01Jtinl U(lpI'l2jst'r. Commercial S<X:llrily Bank

cotJIums CONWl.ETED S[NCEl990 Spoll.'~()J'ecl by the Al~IYrnill<lt 1'nstitu1i! or IJtIllJ Slat¢ Errtitillll

• 11111 A(lpmis",. aN nn Ex:pl!rt\Yit:ni);S~ • Reviewing A(~raisllh • Subdiyitlioll AmllYllis • r\ppraju! of Ramil Pror>cl'tic.r; • O~olor.iI:al COllCilTitS in Rell! Estnte • .Property 11t1o: Concern:; • Ii V.A.C, S'y~lcm~ tn C~L)/Jlmercinl Butltling" • WfI..'!1Itcll Prollf Rt'al F.s[ntc &hrkel .. Th~Omol) SulHmrrbt • VIall D<lpm1Jll~nl: of Tn1l18portntion I't().ic.ct~ • NOll-U"",idenUll] r)"mo Rep<Jrl.'WritinS .. SmnJ.l .llotcIlM1>liI Vtlluntion

IItlO liAST (Sill SOl jTH. SInn, 21))' SAU l.AKEClTY. lfr 841~1

{V(II} :1i2-1J·~9 . ;£1II.yrit]ifre\:lil1dnrt .... 1Clnl"".com


o ary R. Free pg. 3

Courses - continued o Anatomy of an Acquisition • Appraisal and Real Estate Issues ~ Health Care Industry Trends & Real Estate I> Specialized Appraisal Issues • Special·Purpose Properties: The Challenge of Real Estate Appraisal in Limited

Markets • Successful Real Estate Investing • Eminent Domain: New Tools and Strategies for Public Projects in Utah " Business Practice & Ethics • Eminent Domain Update e Various seminars, symposiums and demonstration report writing clinics " USP AP at regular intervals

CLIENTS (PARTIAL LIST)

" Wells Fargo o Bank of Utah • US Bank .. AmericanWest Bank o Bank of the West • Bank of America " Royal Bank of Canada o FDIC • PGP Valuation • Salt Lake County • Salt Lake City Corp • Salt Lake City Dept of Airport " City of South Salt Lake

.. State of Utah Office of Property Rights

" Richfield City " Provo City • Clark County, Nevada " Utah Department of

Transportation " Idaho Department of Lands • Vancott, Bagley, Cornwall • Jones Waldo • Siegfried & Jensen

COURT EXPERIENCE

" US District Court • l't District • 3rd District • 2nd District " US Bankruptcy Court • Five Year Court Experience available upon request

1100 EAST 6600 SOUTH, SUITE 201 . . SALT LAKE CITY, UT 84121 (801) 262-3388 '. [email protected]


Bureau of Occupational L.lcenses Depa.rtment of S~f Governing Agencies

111e PDnJOO nomod II .. met ttle reqalrell1illTl.1:f fll( 1l.0Cl1W", af1<115 entItl~ urRlm'~ho li1W6 IUld rut_ of t~. Statll Df Idaho to QPorato .. I(nl

CERTIFIED,(jE;N&~APPRAfSER .,; .. , ' .. ' f , I' J"".

:~_9},R~~i~~E 1100i.~~:r~'~~O;,~',~rE 201 SA:C1. I;A.~J£llX:~ra4121

· ··~~·;J~~·:-::t ~::-. - - -I , . -...-. 1.l4. ,, <It ...... '-'.'<"~_--

Tan-a Cory CIllef, B.O.L

CGA-12S 'Number

04109/2013 E;cplrv.s


M

QlMUFlCATIONS OF' A.PI:M,ISER

BRENT T. Cl.ARK, MAl Free and Assoc-Tnres

1 (00 EImt, 6600 Sputh, Suite 2m SahLAlkC'Chr. Utah S4121

(801) 26l·3:m brontr;@frcc-oodassocillte.Q,oom

M*R _t. • • (Jmdmittl OfPocAloUa High School, 1968

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Business Adminlstnl1iO'1l.197 5 Mqjor: /1 coounling

StIece8!tfu11y comploted the fbllewing courses and exams SPOIlSOred by tlr~ Appraisl1llnstillllij IUld om,1);J' DlJl'lrioo

Relll BsI.Rto Appml!l:ll Prinelples 1985 Stll1ldards of 'PtofbK~1lI1t11 Vnwtke 1987 Cll.Pilali7Atton Theory &. TcmnilJues 198ft CarJitlil.i7.JItkm lMOfY 'c!t T~tmiqllel1 1989 0130 SmdiC\8 In Real P~ttnlt1" Valustion 19~O Writin It Domo!tl'trnliC'Jl ttcpo.ru '<)9-0 Roport Writing and VlIllllUiO'1l Anulysinl991 Revi!l.wioll Appr(J]sals 1992 Subdivision i\nruysis 1992 Slnndnrds orProfcss[llllru Prll.cUco 199':1 Appruislng, from Blueprlnts &. SpOOJ. J 993 Understand ing LiOljl~d Apprnfllllls 1994 .,\pprlli1la] ofRe!Bill'~tlc~ 199:'i 1'h~ Apprnaen Complete Ro:viow 1996 Stnndarcls of?rofellelOnlll Pl'8t:tice 1997 Hotel/Motel ViJlllRt;jem 1998 ~aml1ll'ds ofrrofc.'1SioflllJ Pmclice 1999 Appmi&lng in tlmiteil Mmi<ct'5 1'999 ApptlllMl of Nr.m·Confotmlng V.os :woo EmIDCCIl Domo;n TI'IIllling fur Anm1'lQ)'J omd Appl1lisol1! 2000 Ap~r81stds and R.eal £st~ LendIng 2001

. t/jglle6t and Best US\!i and Mflri\C!! Anll.lY8is ZOO:! SepBrot:[ng RMJ &. T'<lTsomJl Proport), 2003 USMP ctlJlIlg~ 2003 Income Valuntion oCSmail. Mhted Usc Prop01110S 2003 Seope ",rWorK 2003 BusillC§ ?rnC:llcc9 lind ethics 2004 ForCCllstrng RDvenuc200S FOO$ibflily Annl,yois 2006 Ruvicwilli Appl'Displs in E1111ntmt Domnjn l006 Condominhrrn1l, Co'Op:i, 81)11 PUI)$ 2006


MI'. CI3.rk'I.·QunIU1eatllllls f'u.1l1l :1

a",rduruing COlnll1ercil!i Collstmc!ioll WOi L:itlglll:ions Skins for tb.e A.pp:mi~r 2007 USPA1' Updule 2007 eminent Domain 'Updilte'lOO& USPA? 2009 App.msin.g COl1vcoJern:e SlOrE!S 20M Co~dOO:Ul1lt1'm Appr,lising i>rluolplea/ANllkl.1lio!1s 20t 0

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Course 403. ElI.,em(IJI!V#lu~tiDll Elninccl Elomlfin "r/lbdngfar AtmmO:YJRnd Apprcalstl't RevlelVlng.Appmlsll.!stn :Btnlmmt O(}lJ)IfIn

1996 2000 2006 200S row

Em[mmt Don\ain Updotlt COlldCf.l!Uatkm ApprniKingl'rinciplcsfApp'liolltioru;

),krubel1blp

Umh Sill!!.' Ccl1H'ied Oenl1l'lll A,lpra~'1 ,LT~nre #CGOO037 4!1~ Idaho Stma Ccrli11ed General Appil1l!get • I.l~[1:S8 flClJA·~97 Wyoming StatD Gortlfkd OencJ1II Apj1f1liser- PC4mtl. II 114.a MAT (l-1ombol' A ppmisal lmrtItutll .• professional designtltion from the Apprninl1! In.,tilute (Ccrtiflemil)u Number 10.564) lUlcmalloMI Right-of-Way A~ncillliol1

Art Bosl.cllIlP[t .lr~ MAr Thol1snlld, Oakrr, CA

fohn S. McGowiln, In.c. Woodland HiIIR, CA

Third Judicial Coun

Soc.ond Dislriel COllrT

Real E..~IKlo ApprJliser and COIl&1llrnnl • April 1'987 to prosont. Full limo KPPrlli!sff ilnd ooJlStlltllm for commercllll and indlt,lrilll propart)', raw hllld. IITId mull.ifl1mUy projects.

Ron! EstBIt! A"prni~cr - May 19~6 tQ Milrch 1987

Roat Ls111le ~p1ni5er, Augwd 1986 II) M!lI'~ 1911i

E!,:(pertWitollSs • Apri[ 1994, JiJq>en. Witness· J !lOC 1999 C1<pert WftneiOs· • ~~mber 2000 t:.xpert WItness - August lOQS (TZA 1I1\'tSfi'll'il£ltS 11<lII1noOI Diosmore) f..x:pbrt Wime6S •. Septembef l.G09 (EMJA. U.C t U])01')

~jlert Wltn __ - April .2007 (Hunter J UDOT I!x;pcrl Witness - August 2G07 (TIltIlmllll I UDOT)


Mr. CIQrk'll QualflklllttlJlIs. PIIgc3

.~

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,en,tfll!l J,.llrt 9rc;m,;nl~ Scned

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n,apar t'nnk Salll.1ike County BriglllDo Bank BruoCll'la:h Blfflk. of BOlla.cluy I'W WtlIl Bmlt orUtmi C\!pl!bsICityBllnk .elltik or ArnanClm Port Wl\'!IStdJ&nk Of)' ofWe.vt Jordan UI> ItRllcorp Helm ValJcy Natl{.ual Bstik COrnt1llDlity Flr5t NllIiollal Bnnk Walls l'urgo Ullnk Celtl.cBl\1rl;


EXHIBIT C


stJreau of Occupational t.fcenses DeRartment of Self Governing Agencles

TltoporlQn named Flal mel thu' re.qulrolDllnts for Il>c Ufl~ure lind hl~tltlvd undlJr the lawe and rIJ"". af .1t1.~ ,!>I~UI of Idllhc ro opcrrnttl $II 8(n)

CERTIFISD.§ENERAI- APPRAISER .: .~:(" . .... \. ,, ::.~ .. i\

~~~~:r ... >i-~"'~K 11 og:;.E '6~J~9 :~,iS~IT~\ 201

SAL r«(;;A~E;:;qF'"y,:,U!;84121 .f';,: - \>;\'t\~:.-.. :-:

- /..,..~ C.qP;Y- -' Tans Cory Chlof, B .• O.I...

CGA--391 Numbor

06/06/2013 Elqllr98

IIlvengood 05130/2012

12:2

..


EXHIBITD


Integra Realty Resources Sa lt Lake City

March 4, 2013

Mr. Scott Miller

5107 South 900 East Suite 200 Salt Lake City, UT 84117

Management Solutions Receivership P.O. Box 1290 Salt Lake City, Utah 84110

T 801.263.9700 F 801.263.9709 dlidde [email protected] www.lrr.com

SUBJECT: Proposal/Authorization for Valuation and Consulting Services

Dear Client :

Stonebrook Apartments Phases I & ii, 600 Pioneer Road, Rexburg, Idaho 83440 (the "Subject Property")

Upon your acceptance of this letter agreement, Integra Realty Resources - Salt Lake City, will prepare an appraisal of the Subject Property.

The purpose of the appraisal is to provide an opinion of the market value of the fee simple interest In the Subject Property. The intended use of the appraisal Is for asset valuation purposes . Three values will be presented, one value for Stonebrook Apartments Phase I, one value for 5tonebrook Apartments Phase II, and a combined value of both phases. The appraisal will be prepared in conformance with and subject to, the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute and the Uniform Standards of Professional Appraisal Practice (USPAP) developed by the Appraisal Standards Board of the Appraisal Foundation. The Ethics Rule of USPAP requires us to disclose to you any prior services we have performed regarding the Subject Property within a three year period Immediately preceding the acceptance of this assignment, either as an appraiser or in any other capacity. We represent that we have not performed any services that require disclosure under this rule.

In accordance with our correspondence, the scope of this assignment will require IRR - Salt Lake City to consider all relevant and applicable approaches to value as determined during the course of our research, Subject Property analysis and preparation of the report.

The appraisal will be communicated in a summary reporting format. All work will be performed under the direct supervision of the undersigned, together with other staff members. The


Mr. Scott Miller Management Solutions Receivership March 4, 2013 Page 2

appraisal and this letter agreement will be subject to our standard assumptions and limiting conditions a copy of which is attached as Attachment I.

The total fee for this assignment will be $4,500[including expenses] and the delivery date will be three and a half weeks from your acceptance of this letter agreement, but subject to extension based upon late delivery of the requested data and scheduled access for inspection. The fees will be due and payable within 30 days of the delivery of the reports . It is understood that simple interest of 15% per annum will accrue on any unpaid balance for compensation due, subject to reduction pursuant to any applicable usury law. We shall also be entitled to recover our costs (Including attorneys' fees), associated with collecting any amounts owed or otherwise incurred In connection with this assignment. If the assignment is cancelled by either party prior to completion, you agree to pay us for all our expenses and our time to date based upon the percentage of work completed. Upon default, we shall be permitted to file a lien against the subject property for any amounts owed pursuant to this engagement.

Two copies of each appraisal report will be provided. The delivery date is contingent upon the absence of events outside our control, timely access for inspection of the properties, as well as our receipt of all requested information necessary to complete the assignment.

Please be advised that we are not experts in the areas of building inspection (including mold), environmental hazards, ADA compliance or wetlands. Therefore, unless we have been provided with appropriate third party expert reports, the appraisals will assume that there are no environmental, wetlands, or ADA compliance problems. The agreed upon fees for our services assume the absence of such Issues inasmuch as additional research and analysis may be required. If an expert is required, you are responsible for their selection, payment and actions.

In the event that we receive a subpoena or are called to testify In any litigation, arbitration or administrative hearing of any nature whatsoever or as a result of this engagement or the related report, to which we are not a party, you agree to pay our then current hourly rates for such preparation and presentation of testimony. You agree that: (i) the data collected by us in this aSSignment will remain our property; and (Ii) with respect to any data provided by you, Integra City and its partner companies may utilize, sell and Include such data (either In the aggregate or individually), in our marketing materials, database and derivative products so long as your identity is kept confidential. You agree that all data already in the public domain may be utilized on an unrestricted basis.



If you are In agreement with the terms set forth in this letter and wish us to proceed with the engagement, please sign below and return one copy to us. Thank you for this opportunity to be of service and we look forward to working with you.

Sincerely,

INTEGRA REALTY RESOURCES -SALT LAKE CITY

~w~ Darrin W. liddell, MAl, FRICS, CelM Senior Managing Director

Attachments

AGREED & ACCEPTED THIS DAY OF ________ -',2013.

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX A1UHO}f~1'ImK

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx NXM!:Cl'XOOlQX

STONE BROOK IDAHO, LLC By: ------------------------------

John A. Beckstead, not in his individual capacity but solely

in his capacity as court appointed Receiver for Stone Brook Idaho, LLC

TETONIAN PROPERTIES, LLC By: ------------------------------

John A. Beckstead, not in his individual capacity but solely in his capacity as court appointed Receiver for Tetonian Properties, LLC



ATTACHMENT I

ASSUMPTIONS & LIMITING CONDITIONS

This appraisal is based on the following assumptions, except as otherwise noted in the report.

1. The title is marketable and free and clear of all liens, encumbrances, encroachments, easements and restrictions. The property is under responsible ownership and competent management and is available for its highest and best use.

2. There are no existing Judgments or pending or threatened litigation that could affect the value of the property.

3. There are no hidden or undisclosed conditions of the land or of the improvements that would render the property more or less valuable. Furthermore, there Is no asbestos in the property.

4. The revenue stamps placed on any deed referenced herein to indicate the sale price are in correct relation to the actual dollar amount of the transaction.

5. The property is in compliance with all applicable building, environmental, zoning, and other federal, state and local laws, regulations and codes.

6. The information furnished by others is believed to be reliable, but no warranty is given for its accuracy.

This appraisal is subject to the following limiting conditions, except as otherwise noted in the report.

1. An appraisal is inherently subjective and represents our opinion as to the value of the property appraised.

2. The conclusions stated in our appraisal apply only as of the effective date of the appraisal, and no representation is made as to the effect of subsequent events.

3. No changes in any federal, state or local laws, regulations or codes (including, without limitation, the Internal Revenue Code) are anticipated.

4. No environmental Impact studies were either requested or made In conjunction with this appraisal, and we reserve the right to revise or rescind any of the value opinions based upon any subsequent environmental impact studies. If any environmental impact statement is required by law, the appraisal assumes that such statement will be favorable and will be approved by the appropriate regulatory bodies.

5. Unless otherwise agreed to in writing, we are not required to give testimony, respond to any subpoena or attend any court, governmental or other hearing with reference to the property without compensation relative to such additional employment.

6. We have made no survey of the property and assume no responsibility in connection with such matters. Any sketch or survey of the property included in this report is for illustrative purposes only and should not be considered to be scaled accurately for size. The appraisal


Mr, Scott Miller Management Solutions Receivership March 4, 2013 Page 5

covers the property as described In this report, and the areas and dimensions set forth are assumed to be correct.

7, No opinion is expressed as to the value of subsurface oil, gas or mineral rights, if any, and we have assumed that the property is not subject to surface entry for the exploration or removal of such materials, unless otherwise noted in our appraisal.

8, We accept no responsibility for considerations requiring expertise in other fields, Such considerations include, but are not limited to, legal descriptions and other legal matters such as legal title, geologic considerations such as soils and seismic stability, and civil, mechanical, electrical, structural and other engineering and environmental matters,

9, The distribution of the total valuation in the report between land and improvements applies only under the reported highest and best use of the property, The allocations of value for land and improvements must not be used in conjunction with any other appraisal and are invalid if so used, The appraisal report shall be considered only in its entirety, No part of the appraisal report shall be utilized separately or out of context,

10, Neither all nor any part of the contents of this report (especially any conclusions as to value, the identity of the appraisers, or any reference to the Appraisal Institute) shall be disseminated through advertising media, public relations media, news media or any other means of communication (including without limitation prospectuses, private offering memoranda and other offering material provided to prospective investors) without the prior written consent of the person signing the report,

11, Information, estimates and opinions contained in the report and obtained from third-party sources are assumed to be reliable and have not been independently verified,

12, Any income and expense estimates contained in the appraisal report are used only for the purpose of estimating value and do not constitute predictions of future operating results,

13, If the property is subject to one or more leases, any estimate of residual value contained In the appraisal may be particularly affected by significant changes in the condition of the economy, of the real estate industry, or of the appraised property at the time these leases expire or otherwise terminate,

14, No consideration has been given to personal property located on the premises or to the cost of moving or relocating such personal property; only the real property has been considered,

15, The current purchasing power of the dollar is the basis for the value stated in our appraisal; we have assumed that no extreme fluctuations in economic cycles will occur.

16, The value found herein is subject to these and to any other assumptions or conditions set forth In the body of this report but which may have been omitted from this list of Assumptions and Limiting Conditions,

17, The analyses contained in the report necessarily incorporate numerous estimates and assumptions regarding property performance, general and local business and economic conditions, the absence of material changes in the competitive environment and other matters, Some estimates or assumptions, however, inevitably will not materialize, and unanticipated events and circumstances may occur; therefore, actual results achieved



during the period covered by our analysis will vary from our estimates, and the variations may be material.

18. The Americans with Disabilities Act (ADA) became effective January 26, 1992. We have not made a specific surveyor analysis of the property to determine whether the physical aspects of the improvements meet the ADA accessibility guidelines. We claim no expertise in ADA issues, and render no opinion regarding compliance of the subject with ADA regulations. Inasmuch as compliance matches each owner's financial ability with the cost to cure the non-conforming physical characteristics of a property, a specific study of both the owner's financial ability and the cost to cure any deficiencies would be needed for the Department of Justice to determine compliance .

19. The appraisal report is prepared for the exclusive benefit of the Client, its subsidiaries and/or affiliates. It may not be used or relied upon by any other party. All parties who use or rely upon any information in the report without our written consent do so at their own risk.

20. No studies have been provided to us indicating the presence or absence of hazardous materials on the subject property or in the improvements, and our valuation is predicated upon the assumption that the subject property Is free and clear of any environment hazards including, without limitation, hazardous wastes, toxic substances and mold. No representations or warranties are made regarding the environmental condition of the subject property and the person signing the report shall not be responsible for any such environmental conditions that do exist or for any engineering or testing that might be required to discover whether such conditions exist. Because we are not experts in the field of environmental conditions, the appraisal report cannot be considered as an environmental assessment of the subject property.

21. The person signing the report may have reviewed available flood maps and may have noted in the appraisal report whether the subject property Is located In an identified Special Flood Hazard Area. We are not qualified to detect such areas and therefore do not guarantee such determinations. The presence of flood plain areas and/or wetlands may affect the value of the property, and the value conclusion is predicated on the assumption that wetlands are non-existent or minimal.

22. Integra - Salt Lake City is not a building or environmental inspector. Integra - Salt Lake City does not guarantee that the subject property Is free of defects or environmental problems. Mold may be present In the subject property and a professional inspection is recommended.

23. The appraisal report and value conclusion for an appraisal assumes the satisfactory completion of construction, repairs or alterations in a workmanlike manner.

24. It is expressly acknowledged that in any action which may be brought against Integra Realty Resources - Salt Lake City, Integra Realty Resources, Inc. or their respective officers, owners, managers, directors, agents, subcontractors or employees (the "Integra Parties"), arising out of, relating to, or In any way pertaining to this engagement, the appraisal reports, or any estimates or information contained therein, the Integra Parties shall not be responsible or liable for any incidental or consequential damages or losses, unless the appraisal was fraudulent or prepared with gross negligence. It is further acknowledged that the collective


Mr, Scott Miller Management Solutions Receivership March 4, 2013 Page 7

liability of the Integra Parties In any such action shall not exceed the fees paid for the preparation of the appraisal report unless the appraisal was fraudulent or prepared with gross negligence, Finally, it is acknowledged that the fees charged herein are In reliance upon the foregoing limitations of liability,

25, Integra - Salt Lake City, an independently owned and operated company, has prepared the appraisal for the specific purpose stated elsewhere in the report, The intended use of the appraisal is stated in the General Information section of the report, The use of the appraisal report by anyone other than the Client is prohibited except as otherwise provided, Accordingly, the appraisal report Is addressed to and shall be solely for the Client's use and benefit unless we provide our prior written consent, We expressly reserve the unrestricted right to withhold our consent to your disclosure of the appraisal report (or any part thereof including, without limitation, conclusions of value and our identity), to any third parties, Stated again for clarification, unless our prior written consent Is obtained, no third party may rely on the appraisal report (even if their reliance was foreseeable), [Notwithstanding the above,,,, [Insert client reliance language here; delete If not applicable]

26, The conclusions of this report are estimates based on known current trends and reasonably foreseeable future occurrences, These estimates are based partly on property information, data obtained In public records, interViews, eXisting trends, buyer-seller decision criteria in the current market, and research conducted by third parties, and such data are not always completely reliable, Integra Realty Resources, Inc, and the undersigned are not responsible for these and other future occurrences that could not have reasonably been foreseen on the effective date of this aSSignment. Furthermore, It is inevitable that some assumptions will not materialize and that unanticipated events may occur that will likely affect actual performance, While we are of the opinion that our findings are reasonable based on current market conditions, we do not represent that these estimates will actually be achieved, as they are subject to considerable risk and uncertainty, Moreover, we assume competent and effective management and marketing for the duration of the prOjected holding period of this property,

27, All prospective value estimates presented In this report are estimates and forecasts which are prospective In nature and are subject to considerable risk and uncertainty, In addition to the contingencies noted in the preceding paragraph, several events may occur that could substantially alter the outcome of our estimates such as, but not limited to changes in the economy, Interest rates, and capitalization rates, behavior of consumers, investors and lenders, fire and other physical destruction, changes in title or conveyances of easements and deed restrictions, etc, It is assumed that conditions reasonably foreseeable at the present time are consistent or similar with the future,As will be determined during the course of the assignment, additional extraordinary or hypothetical conditions may be required in order to complete the assignment. The appraisal shall also be subject to those assumptions,

As will be determined during the course of the assignment, additional extraordinary or hypothetical conditions may be required in order to complete the assignment. The appraisal shall also be subject to those assumptions,


ADDENDUM #1 TO LETTER AGREEMENT

(Stonebrook Idaho)

This Addendum #1 (this "Addendum") is an addendum to and forms a part of that certain Letter Agreement (the "Agreement"), dated March 4, 2013, entered into by and between Darrin W. Liddell, MAl, FRICS, CCIM ("Appraiser") on behalf of Integra Realty Resources-Salt Lake City . ("Company"), and John A. Beckstead, not in his individual capacity but solely as the Court-appointed Receiver ("Receiver") for Stone Brook Idaho, LLC ("Stonebrook Idaho Phase I Owner") and Tetonian Properties, LLC, an Idaho limited liability company ("Stonebrook Idaho Phase II Owner," and together with Stonebrook Idaho Phase I Owner, collectively, the "Owner"), in Case No.2: 11-CV -01165 in the United States District Court for the District of Utah ("Court"), entitled Securities Exchange Commission v. Management Solutions, Inc., et al. ("SEC Action"), for the appraisal (the "Appraisal") of certain real property identified in the Agreement and more particularly described in Exhibit A attached hereto (the "Phase I Property") and Exhibit B attached hereto (the "Phase II Property," and together with the Phase I Property, collectively, the "Property"). Stonebrook Idaho Phase I Owner owns a 51 % interest in the Phase I Property. Stonebrook Idaho Phase II Owner is the fee owner of the Phase II Property. The parties hereto agree further as follows:

1. All references in the Agreement to "Scott Miller" or "Mr. Miller" are hereby deleted and replaced with "Owner".

2. The Appraiser acknowledges and agrees that the intended user of the appraisal is both the Receiver and the Court.

3. The Appraiser acknowledges and agrees that the intended use of the Appraisal includes a) internal decision making, b) presentation to prospective buyers of the property for informational purposes, and c) and presentation to the Court or otherwise in connection with Court proceedings.

4. Appraiser and Receiver agree that each party will hold the other harmless from and against any liability, cost or expense (including attorneys' fees) arising out of any claim or legal proceeding brought by a third party where such claim or legal proceeding is based on the negligent act or omission, or misconduct of the other party.

5. Appraiser and Receiver agree that possession of the Appraisal, or a copy thereof, does not carry with it the right of publication, and the Appraisal may not be used by any person or organization except the client without the previous written consent of the Appraiser, and then only in its entirety; provided, however, the Receiver is permitted to present the report to the Court and to prospective buyers of the Property for informational purposes. If the Receiver releases or disseminates the Appraisal to others without the consent of the Appraiser, the client hereby agrees to hold the Appraiser harmless from any liability, damages, or losses which the Appraiser might suffer, for any reason whatsoever, by reason of dissemination of the report by the Receiver. However, nothing herein shall prohibit the Receiver or Appraiser from disclosing said report or opinions contained therein as may be required by applicable law.


6. If a party shall commence any action or proceeding again st another party in order to enforce the provisions of the Agreement or to recover damages as a result of the alleged breach of any of the provisions of the Agreement, the prevailing party shall be entitled to recover from the other party all reasonable costs in connection therewith, including reasonable attorneys' fees .

7. The Agreement is hereby amended as follows:

a. The text "Upon default, we shall be permitted to file a lien against the subj ect property for any amounts owed pursuant to this engagement" as it appears on Page 2 of the Agreement is hereby deleted in its entirety.

b. Clause (i i) of the last full paragraph on Page 2 of the Agreement is hereby deleted in its entirety and replaced with the following text :

"(ii) with respect to any data provided by you, Integra City and its partner companies may utilize, sell and include such data (either in the aggregate or individually) , in our marketing materials, database and derivative products so long as your identity, the Receiver ' s identity, and the identity of the Subject Property is kept confidential. "

8. To the extent that the terms of this Addendum modify or contlict with any provisions of the Agreement, then these terms contro l. All other terms of the Agreement not modified by this Addendum shall remain unchanged in full force and effect.

DATED this __ day of April, 2013.

STONE BROOK IDAHO, LLC

By: ____________________ __ John A. Beckstead, not in his individual capacity but solely in his capacity as court appointed Receiver for Stone Brook Idaho, LLC


By: ________________ __

John A. Beckstead, not in his individual capacity but solely in his capacity as court appointed Receiver for Tetonian Properties , LLC

INTEGRA REA LTY RESOURCES-SALT LAKE CITY

~"'lA.. \IS~l1 Name: Darrin W." LiddJi Title : Senior Managing Director

2


EXHIBIT A TO ADDENDUM #1 TO LETTER AGREEMENT

(Legal Descriptions of Property to Be Appraised)

Real property in the County of Madison, State of Idaho, described as follows:

A TRACT OF LAND WITHIN BLOCK 1 OF THE WESTATES SUBDIVISION NO. 1, MADISON COUNTY, IDAHO, AS SHOWN ON THE PLAT RECORDED MARCH 29, 2002, AS INSTRUMENT NO. 294912, SAID TRACT BEING A PART OF LOT 1, ALL OF LOT 2 AND PART OF LOT 3 MORE PARTICULARLY DESCRIBED AS FOLLOWS: COMMENCING AT A REBAR AND PLASTIC CAP RECOVERED AT THE POINT OF CURVATURE OF CURVE NO. 18, WESTATES SUBDIVISION NO.1, WHICH BEARS N.62°53'10"W. 504.23 (BASIS OF BEARING) FROM A REBAR AND PLASTIC CAP RECOVERED AT THE INTERSECTION OF PIONEER ROAD AND MARIAH AVE; THENCE S.27°06'SO"W. 40.00 FEET TO A POINT ON THE SOUTHERLY RIGHT OF WAY LINE OF PIONEER ROAD; THENCE S.62°53'10"E. 22S.97 FEET ALONG THE SOUTHERLY RIGHT OF WAY LINE OF PIONEER ROAD TO A SIS" REBAR WITH ALUMINUM CAP SET AT THE NORTHWEST CORNER OF LOT 2 AND THE TRUE POINT OF BEGINNING; THENCE S.62°53'10"E. 322.44 FEET ALONG THE SOUTHERLY RIGHT OF WAY LINE OF PIONEER ROAD TO A 5/8" REBAR WITH ALUMINUM CAP SET AT THE POINT OF CURVATURE OF A CURVE TO THE RIGHT; THENCE ALONG SAID CURVE ON A RADIUS OF 564.01 FEET AN ARC DISTANCE OF 282.44 FEET, WITH A CHORD BEARING AND DISTANCE OF S.48°32'27"E. 279.50 FEET TO AN EXISTING FENCE LINE WITHIN LOT 1; THENCE S.46°24'18"W. 275.48 FEET ALONG SAID FENCE LINE TO AN EXISTING FENCE CORNER; THENCE S.89°48'46''W. 9.09 FEET TO A REBAR AND PLASTIC CAP RECOVERED AT THE SOUTHEAST CORNER OF LOT 2; THENCE S.89°48'46''W. 359.47 FEET ALONG THE SOUTH LINE OF LOT 2 TO THE SOUTHWEST CORNER OF LOT 2; THENCE N.21°26'OS"W. S1.37 FEET TO A POINT; THENCE N.06°43'39"E. 139.92 FEET TO A POINT; THENCE N.83°14'33"W. 27.04 FEET TO A POINT ON THE TOP BACK OF AN EXISTING CURVE; THENCE N.06°43'39"E.177.93 FEET ALONG TOP BACK OF CURB TO A POINT; THENCE N.54°56'44"W. 17.48 FEET ALONG TOP BACK OF CURB TO A POINT ON THE END OF EXISTING CONCRETE CURB AND GUTTER; THENCE N.32°46'44"E. 174.21 FEET TO THE TRUE POINT OF BEGINNING. LESS: A PARCEL OF LAND WITHIN THE RECORDED PLAT OF WESTATES SUBDIVISION NO.1, INSTRUMENT NO. 294912, MADISON COUNTY, IDAHO. BEGINNING AT THE NORTHWEST CORNER OF LOT 2, BLOCK 1 OF THE ABOVE REFERENCED SUBDIVISION AND RUNNING THENCE S.62°S2'19"E. 25.00 FEET; THENCE S.27°06'50"W. 111.30 FEET; THENCE N.62°53'10"W. 36.06 FEET; THENCE N.32°46'44"E.111.85 FEET TO THE POINT OF BEGINNING.

A-I


PARCEL 1:

EXHIBIT B TO ADDENDUM #1 TO LETTER AGREEMENT

LOT 3, BLOCK 1 WESTATES SUBDIVISION NO.1, MADISON COUNTY, IDAHO, AS SHOWN ON THE PLAT RECORDED MARCH 29, 2002, AS INSTRUMENT NO. 294912. EXCEPTING THEREFROM: A PART OF LOT 3, BLOCK 1, WESTATES SUBDIVISION NO.1, MADISON COUNTY, IDAHO, AS SHOWN ON THE PLAT RECORDED MARCH 29,2002, AS INSTRUMENT NO. 294912, MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT A 5/8" REBAR WITH ALUMINUM CAP SET AT THE NW CORNER OF LOT 2, BLOCK 1; THENCE S. 32°46'44" W.174.21 FEET TO A POINT ON THE END OF AN EXISTING CONCRETE CURB AND GUTTER; THENCE S. 54°56'44" E. 17.48 FEET ALONG TOP BACK OF CURB TO A POINT; THENCE S. 06°43'39" W. 177.93 FEET ALONG TOP BACK OF CURB TO A POINT; THENCE S. 83°14'33" E. 27.04 FEET TO A POINT; THENCE S. 06°43'39" W. 139.92 FEET TO A POINT; THENCE S. 21°26'05" E. 51.37 FEET TO THE SE CORNER OF LOT 3; THENCE N. 00°11'43" W. 380.79 FEET ALONG THE EAST LINE OF LOT 3 TO A PK NAIL RECOVERED AT AN ANGLE POINT ON THE EAST LINE OF LOT 3; THENCE N. 27°06'54" E. 159.97 FEET ALONG THE EAST LINE OF LOT 3 TO THE POINT OF BEGINNING. PARCEL 2: A PARCEL OF LAND WITHIN THE RECORDED PLAT OF WESTATES SUBDIVISION NO.1, INSTRUMENT NO. 294912, MADISON COUNTY, IDAHO. BEGINNING AT THE NORTHWEST CORNER OF LOT 2 OF THE ABOVE REFERENCED SUBDIVISION AND RUNNING THENCE S.62°52'19"E. 25.00 FEET; THENCE S.27°06'50"W.111.30 FEET; THENCE N.62°53'10"W. 36.06 FEET; THENCE N.32°46'44"E. 111.85 FEET TO THE POINT OF BEGINNING

A-2


EXHIBIT E


Integra Realty Resources 5107 South 900 East T 801.263.9700Salt Lake City Suite 200 F 801.263.9709

Salt Lake City, UT 84117 [email protected]

Darrin W. Liddell, MAI, FRICS, CCIMSenior Managing DirectorIntegra Realty Resources – Salt Lake City5107 South 900 East, Suite 200Salt Lake City, UT 84117Ph: (801) 263-9700, ext. 111Fax: (801) [email protected]

Actively engaged in the real estate industry since 1990, Darrin Liddell, an MAI, FRICS, CCIM hasspent his career assisting clients with commercial real estate valuation and consultation. Heprovides these services to a variety of commercial, private and government organizations. He iscurrently the Managing Director of Integra Realty Resources – Salt Lake City.

As Managing Director, Mr. Liddell oversees real estate appraisal and consulting assignments toensure the excellence of the firm's produced reports. By understanding the dynamics of a widevariety of real estate sectors, he helps prepare clients to make complex real estate decisions. Hehas diverse experience with a variety of real estate types such as mixed-use, retail, multi-family,office, and industrial. He specializes in automobile dealership valuation.

Mr. Liddell is engaged in teaching real estate courses at the University of Utah’s David EcclesSchool of Business in the MBA, MRED (Masters of Real Estate Development) and undergraduateprograms. He has enjoyed teaching real estate principles, investment, and appraisal coursessince 1994. His presentation skills are polished from his teaching experience.

Prior to receiving his MBA in 1993, Mr. Liddell received a Bachelor of Science in 1991 from theUniversity of Utah. He majored in Finance and minored in Sociology. Darrin was invited intomembership of the Appraisal Institute (MAI) in 1997, became a Certified Commercial InvestmentMember (CCIM) in 2001, and was awarded fellowship of the Royal Institute of CharteredSurveyors (FRICS) in 2012.


Court Testimony

COURT TESTIMONY – LAST 5 YEARS

CASE DATE COMMENT

Wilburgene v. Kirk Blosch, et al.Case No. 08-02101

April 22, 2009 Deposition

National Surety Company v. QuestarGas CompanyCase No. 090910830

November 19, 2011 Deposition

910 Cattle Company v. Stoel Rives,LLP, et al.Case No. 100907407

February 6, 2012 Deposition

PUBLICATIONS

None

Fee Structure

Appraisal assignments are typically bid on a case by case basis. The fees vary depending on thecomplexity of the assignment, report type and requested timing.

For complex litigation assignments, Integra often quotes a fee based on our standard hourlyrates. These are presented below for your convenience.

Schedule of Hourly Rates

Consultant Hourly Rate Range

Senior Managing Director $250.00 To Negotiated

Managing Director $250.00 To Negotiated

Senior Director $200.00 To $250.00

Director $200.00 To $250.00

Associate Director $150.00 To $200.00

Senior Analyst $150.00 To $200.00

Analyst $100.00 To $150.00

Administrative Staff $50.00 To $100.00


Darrin W. Liddell, MAI, FRICS, CCIM Salt Lake CityIntegra Realty Resources

irr.com

T 801.263.9700F 801.263.9709

5107 South 900 EastSuite 200Salt Lake City, UT 84117

ExperienceSenior Managing Director and full time commercial real estate appraiser/consultant for IntegraRealty Resources-Salt Lake City in Utah since November 2005. He has spent roughly 20 years assistingclients with commercial real estate valuation and consultation. He provides these services to avariety of commercial, private and government organizations.

Darrin specializes in a wide range of retail oriented properties and generates complex feasibility andcash flow analyses. Although the retail sector is his primary focus, he has experience with other realestate types including mixed-use, multi-family, office, auto dealership and industrial. Byunderstanding the dynamics of a wide variety of real estate sectors, Darrin helps prepare clients tomake complex real estate decisions.

Darrin is a member of the Appraisal Institute (MAI) and is a Certified Commercial InvestmentMember (CCIM). He is also a fellow of the Royal Institute of Chartered Surveyors (FRICS). He hasenjoyed teaching real estate principles, investment, and appraisal courses in the MBA, MRED(Masters of Real Estate Development) and undergraduate programs at the University of Utah forover 15 years.

Professional Activities & AffiliationsAppraisal Institute, Member (MAI), January 1997Certified Commercial Investment Member (CCIM), June 2002Royal Institute of Chartered Surveyors, Fellow (FRICS), December 2007Instructor: Adjunct Assistant Professor of Finance; University of Utah, David Eccles School of BusinessDepartment of Finance from 1995 to present.

Course: Real Estate Principles (Finance 4740).Course: Real Estate Appraisal and Investment (Finance 5770).Course: Real Estate Analysis (Finance 6770).Experience Review Committee: State of Utah, Department of CommerceDivision of Real Estate from 1994 to present.Board of Director: Appraisal Institute - Utah Chapter from 2003 to 2009.President: Appraisal Institute - Utah Chapter in 2008.University of Utah Business Alumni Association, Board of Directors from 2003 to 2006.

LicensesUtah, Certified General Appraiser, 5450608-CG00, Expires June 2015Idaho, Certified General Appraiser, CGA-246, Expires March 2014Wyoming, Certified General Appraiser, Permit #401, Expires December 2013Montana, Certified General Appraiser, 685, Expires March 2014Arizona, Certified General Appraiser, 31725, Expires June 2013Colorado, Certified General Appraiser, 100003724, Expires December 2015Utah, Sales Agent, 5450608-SA00, Expires February 2014Utah, Pre-Licensing Real Estate Instructor, 5450608-PI00, Expires December 2013Utah, Pre-Licensing Appraiser Instructor, 5450608-AI00, Expires December 2013

EducationMBA, University of Utah, June 1993

[email protected] - 801.263.9700 x111

Bachelor of Science, University of Utah, June 1991Major: Finance; Minor: Sociology


EXHIBIT F


IH I f I''-'l HI_

Hf'1k,nO~ IHlf

UEI'ART\lENT OF COMI\IERCF: D1\"ISION OF REAL ESTATE

ACTIVE LICENSE

0Jfl&l10lJ

c.rtlll<d c ...... App ......

DAIUlIN W UDD~1.1. 51f7 S,.. E STE 1011 SAI.T I.A KEClTVUT '-1111


EXHIBIT G


REAL ESTATE CONSULTANTS / APPRAISERS

NEUGENT & HELBING, INC.

14110 Dallas Parkway, Suite 202Dallas, Texas 75254(972) 387-2626

May 1, 2013

Mr. Scott MillerDirector of Operations and AdministrationManagement Solutions ReceivershipP.O. Box 1290Salt Lake City, Utah 84110

RE: A real property appraisal of an 8.509 gross acre tract of land situated on Las Colinas Boulevardnear its intersection with Colwell Boulevard, north of State Highway 114, in the city of Irving,Dallas County, Texas.

Dear Mr. Miller:

This letter will confirm our discussion requesting Neugent & Helbing, Inc. to provide a summary appraisalreport of the above referenced property. The purpose of the appraisal will be to provide a market value ofthe fee simple interest in the subject property. The fee for our services to provide a summary appraisal reportwill be $2,200.00. The quoted fee is inclusive of all related costs, including travel expenses. We will notrequire a retainer prior to initiating the appraisal process, but the full fee is due upon completion and deliveryof the report.

The final report will be completed no later than three weeks from the date we receive the signed engagementletter, the retainer and the requested property information. The following items are required in order toproperly initiate the appraisal assignment:

1) Site Survey, if available.2) Tax account number and any applicable tax information.3) Contact person for property.4) Environmental reports, if applicable.

Please realize that this is our best estimate of our delivery date and may be subject to change because ofconditions beyond our control. The fee is also subject to modification and/or change, by mutual agreement,should you require changes to the assignment described herein. It is our opinion that this report is in fullcompliance with all applicable requirements contained within the Office of the Comptroller of the Currency(OCC) Final Rule on FIRREA and the current Uniform Standards of Professional Appraisal Practice (USPAP).

Our report will contain numerous Assumptions and Limiting Conditions which are requisite to the conclusionsreached therein. The standard Assumptions and Limiting Conditions are attached hereto, and made a parthereof for all purposes. Your signature below acknowledges that you have read, understood, and agreedto these assumptions. In addition to these standard Assumptions, there may be assumptions contained inour report which are specific to your property.

The appraisal work described above and the fee therefore does not include appearances or testimony in anyCourt of Law. Additional services of the appraiser for testimony or pre-trial conferences, if required, will bein addition to the stated fee at a rate of $250.00 per hour with a $1,000.00 minimum.


Mr. Scott Miller Management Solutions Receivership May 1, 2013 Page Two

It is mutually agreed that our acceptance of this assignment is not contingent upon any predetermined conclusions to value or marketability . Should the assignment be canceled , you agree to pay for our time and costs incurred prior to receipt of written notice of cancellation.

Our full fee is due and payable at our offices in Dallas County , Texas, upon delivery of the appraisal to you, or cancellation of the assignment. If the fee is not paid upon receipt of our invoice, interest will accrue at the rate of 18% per year, or at the highest level lawful rate applicable at the time of this agreement.

If this agreement is given to an attorney for collection or enforcement, the prevailing party shall be entitled to recover all costs, expenses and reasonable attorney's fees incurred because of the legal action. If the foregoing is agreeable, please sign where indicated on this letter and return to me. Please keep a copy for your files .

I look forward to working with you on this assignment. If you have any questions or require additional information, please do not hesitate to contact me.

Sincerely,

ACCEPTED BY:

Date

Mr. Scott Miller Management Solutions Receivership

REAL ESTATE CONSULTANTS I APPRAISERS



STANDARD ASSUMPTIONS AND LIMITING CONDITIONS

1. Disclosure of the contents of the appraisal report is governed by the bylaws and regulations of theprofessional appraisal organizations with which the appraiser is affiliated: specifically, the AppraisalInstitute.

2. When the signatory of this appraisal report is a candidate or a member of the Appraisal Institute, itsbylaws and regulations require the member or candidate to control the use and distribution of thereport. Therefore, except as hereinafter provided, the party for whom this appraisal report wasprepared may distribute copies of the report, in its entirety, to such third parties as may be selectedby the party for whom this appraisal report was prepared. However, selected portions of thisappraisal report shall not be given to third parties without the prior written consent of the signatoryof the report. Further, neither all nor any part of this appraisal report shall be disseminated to thegeneral public by the use of advertising media, public relations media, news media, sales media orother media for public communication without the prior written consent of the signatory of the report.Nor shall the appraiser, firm, or professional organization of which the appraiser is a member beidentified without written consent of the appraiser.

3. The appraiser will not be required to give testimony or appear in court because of having made thisappraisal, with reference to the property in question, unless previous arrangements have been made.

4. The distribution of the total valuation in this report between land and improvements applies onlyunder the stated highest and best use of the property. The separate allocation of value for land andimprovements must not be used in conjunction with any other appraisal and is invalid if so used.

5. The legal description used in this report is assumed to be correct.

6. No survey of the property has been made by the appraiser and no responsibility is assumed inconnection with such matters. Maps and sketches are included only to assist the reader in visualizingthe property.

7. No responsibility is assumed for matters of a legal nature affecting title to the property, nor is anopinion of title rendered. The title is assumed to be good and merchantable unless otherwise stated.

8. It is assumed that there are no hidden or unapparent conditions of the property, subsoil, (includingtermite infestations) or structures which would render it more or less valuable. No responsibility isassumed for such conditions or for engineering which may be required to discover such.

9. All mechanical components are assumed to be in operable condition as would be consideredstandard for properties similar to the subject in type and age. The heating, cooling, ventilation,plumbing and electrical equipment are considered to be in similar condition to the observableelements of the improvements unless otherwise stated. The insulation and energy efficiency of theimprovements are assumed to be adequate and standard for the subject type and age unlessotherwise noted.

10. Information furnished by others is assumed to be true, correct and reliable. A reasonable effort hasbeen made to verify such information; however, no responsibility for its accuracy is assumed by theappraiser.

11. The value estimate assumes responsible ownership and competent management.



12. Unless otherwise stated in this report, the existence of hazardous substances, including withoutlimitation asbestos, polychlorinated biphenyls, petroleum leakage, or agricultural chemicals, whichmay or may not be present on the property, or other environmental conditions, were not called to theattention of nor did the appraiser become aware of such during the appraiser's inspection. Theappraiser has no knowledge of the existence of such materials on or in the property unless otherwisestated. The appraiser, however, is not qualified to test such substances or conditions. If thepresence of such substances, such as asbestos, urea formaldehyde foam insulation, or otherhazardous substances or environmental conditions, may affect the value of the property, the valueestimated is predicated on the assumption that there is no such condition on or in the property or insuch proximity thereto that it would cause a loss in value. No responsibility is assumed for any suchconditions, nor for any expertise or engineering knowledge required to discover them.

13. Opinions of value contained in this report are estimates. There is no guarantee, written or implied,that the subject property will sell or lease for the indicated amounts.

14. The appraisers of Neugent & Helbing, Inc. reserve the right to amend and/or alter statements,analyses, conclusions and value estimates if information pertinent to this assignment is made knownto us after the completion of the report.

15. Neugent & Helbing, Inc., as well as any employee, agent or officer thereof, shall be completelyindemnified against any and all losses, claims, damages, liabilities, costs or expenses to which therecipient and/or third party user may become subject, but only if neither Neugent & Helbing, Inc. norany other indemnified person shall have been grossly negligent or shall have taken or omitted to takeany action in bad faith in connection with the preparation of this report.

16. The Americans with Disabilities Act ("ADA") became effective January 26, 1992. We have not madea specific compliance survey and analysis of this property to determine whether or not it is inconformity with the various detailed requirements of the ADA. It is possible that a compliance surveyof the property, together with a detailed analysis of the requirements of the ADA, could reveal thatthe property is not in compliance with one or more of the requirements of the Act. If so, this factcould have a negative effect upon the value of the property. Since we have no direct evidencerelating to this issue, we did not consider possible noncompliance with the requirements of ADA inestimating the value of the property.

17. Unless otherwise noted, all prospective value estimates, if any, in this appraisal, are based on themarket conditions which exist at the date of inspection combined with an informed forecast, basedon current trends in supply and demand for the property type under appraisal, as to what suchconditions will be at the future date of property completion and or stabilization. The appraiser cannotbe held responsible for unforeseeable events, such as unexpected new construction, unanticipatedchanges in economic conditions, or any other such events which might occur and which would altermarket conditions prior to the effective date of the appraisal.


Addendum to Proposal for the Appraisal of 8.5 Acres on Las Colinas Boulevard

This Addendum to Proposal for the Appraisal of 8.5 Acres on Las Colinas Boulevard (this “Addendum”) is an addendum to and forms a part of that certain Proposal (the “Proposal”), dated May 1, 2013, submitted by Ross C. Helbing (“Appraiser”) on behalf of Neugent & Helbing, Inc. (“Company”), and John A. Beckstead, not in his individual capacity but solely as the Court-appointed Receiver (“Receiver”) for Cala Senior, L.P., in Case No. 2:11-CV-01165 in the United States District Court for the District of Utah (“Court”), entitled Securities Exchange Commission v. Management Solutions, Inc., et al. (“SEC Action”), for the appraisal (the “Appraisal”) of approximately 8.509 acres located on Las Colinas Boulevard near its intersection with Colwell Boulevard, north of State Highway 114, in the city of Irving, Dallas County, State of Texas. The parties hereto agree further as follows:

1. The Receiver and the Court shall each be considered an intended user of the Appraisal.

2. The intended use of the Appraisal as described in the first paragraph of the Proposal shall include a) internal decision making, b) presentation to prospective buyers of the property for informational purposes, and c) and presentation to the Court or otherwise in connection with Court proceedings.

3. The validity, interpretation and performance of the Proposal and this Addendum shall be controlled by and governed in all respects by the laws of the state of Utah, without regard to the principles of conflicts of laws. The Court in the SEC Action has sole and exclusive jurisdiction to interpret the Proposal and this Addendum and resolve any disputes hereunder until such SEC Action is closed.

4. Section 15 of the Standard Assumptions and Limiting Conditions is deleted in its entirety.

5. To the extent that the terms of this Addendum modify or conflict with any provisions of the Proposal, then these terms control. All other terms of the Proposal not modified by this Addendum shall remain unchanged in full force and effect.

DATED this ___ day of May, 2013.

CALA SENIORS, L.P. By: John A. Beckstead, not in his individual capacity

but solely as Receiver for Cala Seniors, L.P. NEUGENT & HELBING, INC. By: Ross C. Helbing, Principal


EXHIBIT H


QUALIFICATIONS OF BOB BROWN, MAI Vice President CBRE, Inc., Valuation & Advisory Services 257 E. 200 South Street, Suite 1020 Salt Lake City, Utah 84111 Direct: (801) 606-1108 Office: (801)869-8000 Fax: (801) 869-8080 E-mail: [email protected] EDUCATIONAL

Bachelor of Science Degree, Business (major), Spanish (minor) Brigham Young University, Provo, Utah

PROFESSSIONAL

Appraisal Institute – Designated Member, 2010 CB Richard Ellis – Member Retail Valuation Group

LICENSE(S)/CERTIFICATION(S)

State of Utah Certified General Real Estate Appraiser No. 5474215-CG00

State of Idaho Certified General Real Estate Appraiser No. CGA-1538 State of Montana Certified General Real Estate Appraiser No. 892 State of Wyoming Certified General Real Estate Appraiser No. 806

EMPLOYMENT EXPERIENCE Professional experience in the fee preparation of real estate appraisals, rent analyses and market studies of commercial, industrial and residential investment properties. Primary experience encompasses a wide variety of property types including suburban and CBD office (professional/medical), retail (shopping centers/free-standing), industrial (parks/free-standing), multifamily (apartment/manufactured home park), and subdivision. Experience also includes special purpose properties such as hotel/lodging, service stations, etc. Assignments completed in Utah, Idaho, Montana, Wyoming, Primary geographical concentration is Utah and Idaho. The Intermountain Region of CB Richard Ellis, Inc. Appraisal Services covers the states of Arizona, Colorado, Idaho, Montana, Nebraska, Nevada, New Mexico, North and South Dakota, Utah, and Wyoming. 2000-present CB Richard Ellis, Inc. Salt Lake City, UT Real Estate Analyst Seattle, WA 1998 -2000 Lybbert & Associates Seattle, WA Staff Appraiser


EXHIBIT I


HOLLAND & HART LLP David K. Broadbent, #0442 Matthew T. Wirthlin, #8291 Romaine C. Marshall, #9654 J. Andrew Sjoblom, #10860 Doyle S. Byers, #11440 Cory A. Talbot, #11477 222 S. Main Street, Suite 2200 Salt Lake City, UT 84101 Telephone: 801-799-5960 Fax: 801-713-6259 Attorneys for John A. Beckstead as Receiver

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF UTAH, CENTRAL DIVISION

SECURITIES AND EXCHANGE COMMISSION, Plaintiff, vs. MANAGEMENT SOLUTIONS, INC., a Texas Corporation; WENDELL A. JACOBSON; ALLEN R. JACOBSON, Defendants.

ORDER CONFIRMING APPOINTMENT

OF APPRAISERS REGARDING SALE OF PROPERTY OF

STONE BROOK IDAHO, LLC, AND TETONIAN PROPERTIES, LLC

Civil Action No. 2:11-cv-01165 Judge Bruce S. Jenkins

John A. Beckstead, the Court-appointed receiver in this matter (the “Receiver”), has

moved the Court to appoint appraisers to assist the Court and the Receiver in evaluating the

reasonableness of the proposed private sale of the Receivership’s property located at 600 Pioneer

Road, Rexburg, Idaho 83440.


-2-

Based upon the submissions and good cause appearing, the Court HEREBY ORDERS

that Darrin W. Liddell, Gary R. Free, and Bob Brown be approved as Court-appointed appraisers

to assist the Court and the Receiver in evaluating the reasonableness of the proposed private sale.

Dated this ____ day of May, 2013.

United States District Court Judge ____________________________________ Honorable Bruce S. Jenkins 6177775_1.DOCX


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