United Development Funding IV fka UDFI

[curious analyst]

Thanks.

[Enterprising Investor]

NexPoint Highlights How United Development Funding IV (UDF IV) Financial Statements Reveal Questionable Conduct and Value Erosion Under Board of Trustees (9/16/24)

Urges Shareholders to Vote for Board Change by Supporting NexPoint Nominees

DALLAS, Sept. 16, 2024 /PRNewswire/ -- NexPoint Real Estate Opportunities, LLC (together with its affiliates "NexPoint") announced today that it has sent a letter to fellow shareholders of United Development Funding IV ("UDF IV" or the "Company"), a real estate investment trust, ahead of the Company's upcoming Annual Meeting of Shareholders, which must be held on or before December 31, 2024.

NexPoint's letter details how UDF IV's financial statements reveal questionable conduct by the Board of Trustees, leading to significant value erosion. The letter highlights UDF IV's skyrocketing impaired loans, questionable loan extensions, unhealthy loan concentration to one borrower, asset erosion from G&A expenses, and misleading statements. NexPoint urges shareholders to vote for change by supporting NexPoint nominees Paul S. Broaddus, Edward N. Constantino, John A. Good, and Julie Silcock.

Shareholders can read the full letter here.

While UDF IV has not announced its Annual Meeting date, shareholders can vote TODAY using NexPoint's GREEN proxy materials to enact long overdue change and elect Trustees who will work for all shareholders to maximize value at UDF IV.

NexPoint encourages shareholders to visit udfaccountability.com and complete the contact form to receive ongoing updates about the Company and the upcoming Annual Meeting.

Shareholders can also contact NexPoint via email at [e-mail].

About NexPoint

NexPoint Real Estate Opportunities, LLC is a wholly owned subsidiary of NexPoint Diversified Real Estate Trust, Inc. (NYSE: NXDT), an affiliate of NexPoint Advisors, L.P.

NexPoint Advisors, L.P. is an SEC-registered adviser on the NexPoint alternative investment platform. It serves as the adviser to a suite of funds and investment vehicles, including a closed-end fund, interval fund, business development company, and various real estate vehicles. For more information visit www.nexpoint.com

IMPORTANT INFORMATION

NexPoint Real Estate Opportunities, LLC ("NexPoint") intends to deliver a proxy statement with respect to its solicitation of proxies for nominees to be elected to the United Development Funding IV ("UDF IV") Board of Trustees at the Annual Meeting of Shareholders of UDF IV. The date for the Annual Meeting has not yet been set and NexPoint is not soliciting proxies at this time. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE NEXPOINT PROXY STATEMENT (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) WHEN AVAILABLE IN ITS ENTIRETY BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION ABOUT ANY SOLICITATION. Copies of the documents will be made available free of charge from NexPoint by accessing the website www.udfaccountability.com.

NexPoint, its affiliates, their directors and executive officers and other members of management and employees may be participants (collectively "Participants") in the solicitation of proxies by NexPoint. Information about NexPoint's nominees to the UDF IV Board of Trustees and information regarding the direct or indirect interests in UDF IV, by security holdings or otherwise, of NexPoint, the other Participants and NexPoint's nominees will be available in the proxy statement. NexPoint's disclosure of any security holdings will be based on information made available to NexPoint by such Participants and nominees. UDF IV is no longer subject to the reporting requirements of the Securities Exchange Act of 1934, as amended. Consequently, NexPoint's knowledge of significant security holders of UDF IV and as to UDF IV itself is limited.

CONTACT INFORMATION

UDF IV Investor Contacts
Chuck Garske / Jeremy Provost / Theo Caminiti (Okapi Partners):
Email: [e-mail]
Phone: [phone]

For Additional Information/Updates on UDF IV
Website: www.udfaccountability.com
Email: [e-mail]

https://www.prnewswire.com/news-releases/nexpoint-highlights-how-united-development-funding-iv-udf-iv-financial-statements-reveal-questionable-conduct-and-value-erosion-under-board-of-trustees-302249289.html

[Enterprising Investor]

Simply, there are two proxies.

If you approve of the NexPoint slate and have already voted, do nothing.

[curious analyst]

Can someone explain what if going on with the vote?
Today I got an email from UDF to vote in the contested election.
1. The options were for different board members than the four Nexpoint recommends.
2. I thought I already voted when I got an earlier email.

Nexpoint encourages shareholders to vote for change by supporting NexPoint nominees: Paul S. Broaddus, Edward N. Constantino, John A. Good, and Julie Silcock.

The UDF email only lists these other four men.
Election of Class III Independent Trustee: J. Heath Malone
Board Recommendation: FOR
and recommends Lawrence S. Jones, Phillip K. Marshall, Steven J. Finkle.

[Phaedrus77]

Bass didn’t destroy the company. The four felons did. The trial didn’t even cover the time period that Bass was involved.

UDF has offered absolutely no proof that NexPoint had anything to do with Bass.

I have nothing to do with either one. I’m just a schmuck who bought shares because I believed Hollis’s bullshit. I’m quite embarrassed that I didn’t see through the bullshit earlier….the evidence was there all along (not producing the requested documents in the Bass lawsuit, not getting an audit done (and blaming it on Bass), not providing any updates for shareholders, etc etc).

Looking back, it’s obvious the felons were afraid to give out any information because they knew it’d make them look guilty (ie the new auditor insisting on related party disclosures).

[freddie me]

Are you Hollis's cell mate?

[truthwins2020]

you can keep snuggling in the mud with Nexpoint all you want. they were complicit with Bass in trying to destroy this company and good peoples lives. as far as i know, you work for both of them and just sow discord in this little thread. good luck.

[Enterprising Investor]

NexPoint Alerts United Development Funding IV (UDF IV) Shareholders to Current Board's Red Flags, Including Track Record of Fraud and Value Destruction (9/03/24)

Urges Shareholders to Vote for Board Change by Supporting NexPoint Nominees

DALLAS, Sept. 3, 2024 /PRNewswire/ -- NexPoint Real Estate Opportunities, LLC (together with its affiliates "NexPoint") announced today that it has sent a letter to fellow shareholders of United Development Funding IV ("UDF IV" or the "Company"), a real estate investment trust, ahead of the Company's upcoming Annual Meeting of Shareholders, which must be held on or before December 31, 2024.

In its letter, NexPoint urges shareholders to consider the numerous red flags around UDF IV's current Board of Trustees before voting in the Trustee election. Given the incumbent Trustees' track record on the Board, which includes presiding over fraud and value destruction, among other offenses, NexPoint encourages shareholders to vote for change by supporting NexPoint nominees: Paul S. Broaddus, Edward N. Constantino, John A. Good, and Julie Silcock.

Shareholders can read the full letter here.

While the Company has not announced an Annual Meeting date, shareholders can vote TODAY using NexPoint's GREEN proxy materials to enact long overdue change and elect Trustees who will work for all shareholders to maximize value at UDF IV.

NexPoint encourages shareholders to visit udfaccountability.com and complete the contact form to receive ongoing updates about the Company and the upcoming Annual Meeting.

Shareholders can also contact NexPoint via email at [e-mail].

About NexPoint

NexPoint Real Estate Opportunities, LLC is a wholly owned subsidiary of NexPoint Diversified Real Estate Trust, Inc. (NYSE: NXDT), an affiliate of NexPoint Advisors, L.P.

NexPoint Advisors, L.P. is an SEC-registered adviser on the NexPoint alternative investment platform. It serves as the adviser to a suite of funds and investment vehicles, including a closed-end fund, interval fund, business development company, and various real estate vehicles. For more information visit www.nexpoint.com

IMPORTANT INFORMATION

NexPoint Real Estate Opportunities, LLC ("NexPoint") intends to deliver a proxy statement with respect to its solicitation of proxies for nominees to be elected to the United Development Funding IV ("UDF IV") Board of Trustees at the Annual Meeting of Shareholders of UDF IV. The date for the Annual Meeting has not yet been set and NexPoint is not soliciting proxies at this time. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE NEXPOINT PROXY STATEMENT (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) WHEN AVAILABLE IN ITS ENTIRETY BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION ABOUT ANY SOLICITATION. Copies of the documents will be made available free of charge from NexPoint by accessing the website www.udfaccountability.com.

NexPoint, its affiliates, their directors and executive officers and other members of management and employees may be participants (collectively "Participants") in the solicitation of proxies by NexPoint. Information about NexPoint's nominees to the UDF IV Board of Trustees and information regarding the direct or indirect interests in UDF IV, by security holdings or otherwise, of NexPoint, the other Participants and NexPoint's nominees will be available in the proxy statement. NexPoint's disclosure of any security holdings will be based on information made available to NexPoint by such Participants and nominees. UDF IV is no longer subject to the reporting requirements of the Securities Exchange Act of 1934, as amended. Consequently, NexPoint's knowledge of significant security holders of UDF IV and as to UDF IV itself is limited.

CONTACT INFORMATION

UDF IV Investor Contacts
Chuck Garske / Jeremy Provost / Theo Caminiti (Okapi Partners):
Email: [e-mail]
Phone: [phone]

For Additional Information/Updates on UDF IV
Website: www.udfaccountability.com
Email: [e-mail]

Media Contacts
Lucy Bannon (NexPoint): [e-mail]
Paul Caminiti/Pamela Greene (Reevemark): [e-mail]

NexPoint Investor Relations
Kristen Thomas: [e-mail]

https://www.prnewswire.com/news-releases/nexpoint-alerts-united-development-funding-iv-udf-iv-shareholders-to-current-boards-red-flags-including-track-record-of-fraud-and-value-destruction-302236961.html

[Dr Quest]

You might be correct, but then again, since you are projecting, you could also be incorrect.

Either way, it doesn't prove or even suggest that Nexpoint has MY interests at heart even if their actions promulgated the changes.. I feel fairly certain they have their interests at heart. The whole event seems more sordid and reeks of "collusion" between Bass and Nexpoint(regardless of the actions of the original BOD, who no longer run the show).

In any event, the increased distribution was explained in the UDFI literature and they seemed to infer that it would possibly/probably be a one time event.

JMHO

[Phaedrus77]

I think it’s telling that they didn’t increase the regular distribution, but rather declared an additional special distribution. If they keep their seats, my bet is that we’ll be back to 6.5 cents per quarter in 2025.

As it is, I hope shareholders realize none of this (increased distribution, BoD elections, probably even audited financials, etc) would have happened without NexPoint’s lawsuits.

[Davlund]

Very predictable, you called it, after all it is an election year!!

[Phaedrus77]

Well, there you go. 13 cent distro this Q.

https://udfonline.com/united-development-funding-iv-and-udf-income-fund-v-announce-cash-distributions-for-q3-2024/

[Phaedrus77]

Well this is interesting. UDF IV acquires a loan AT PAR on 4/26/23 from SRES Originations, an entity that is 20% owned by Kenney and 20% owned by Dwyer.

The loan was placed in default on 7/20/23 (less than 3 months after UDF paid par for it), the borrowing entity was placed into receivership on 7/31 and the principals were sued in Dec 2023 to enforce their personal guarantees. The loan was repaid in full on 7/1/24. I’d love to know how/why they decided to buy that one at par.

Then you’ve got a bailout of UDF I on the Lakeside Loan, which UDF IV has now booked an $8.4 reserve on.

[Phaedrus77]

UDF put up a new website for the proxy contest.

https://www.udfforshareholders.com/

"Support the Board and Management Team that Are Taking Action to Build on the Trust’s Track Record of Delivering Enhanced Shareholder Returns"

You can't make this shit up.

[Phaedrus77]

It’ll be interesting to see if they raise the quarterly RoC in an attempt to buy votes. We should get an announcement on Q3’s amount in the next couple of weeks.

[Enterprising Investor]

I'll take early every time.

This scene from Moneyball comes to mind if I was an insider.

Clip

Billy Beane: Would you rather get a bullet to the head, or five to the chest and bleed to death?

[Dr Quest]

I haven't received such an early notice either.

But then again, I have received numerous other company proxy vote materials that have arrived after the voting deadline.

Which would I rather choose, early or late? ....hmm, let me think.

[Enterprising Investor]

Proxy Statement and Letter received.

I have been investing since December 1982 and never recall receiving a proxy statement so far in advance. The meeting is scheduled for 12/31/24 at noon ET.

A couple of things comes to mind... Who schedules a shareholder meeting for New Year's Eve? I guess everyone connected with UDF wants to keep their roles for as long as possible? Or maybe they are hoping people forget to vote by 12/30/24?

[ofirm]

Bass was acting in a criminal way over here. Nexpoint was part of his plan to take over the underlying assets securing the loans.
Greenlaw & co. are crooks. one thing does not contradict the other.

[Enterprising Investor]

No argument from me.

Just sharing some of their propaganda.

[freddie me]

UDF management can go screw imo...

[Enterprising Investor]

UDF IV Files Proxy Statement and Mails Letter to Shareholders (8/12/24)

https://cdn.prod.website-files.com/6672de653872fa53a4cbe8e2/66b6cc48d8d7622b928a2022_UDF%20IV%20Files%20Proxy%20Statement%20and%20Mails%20Letter%20to%20Shareholders.pdf

[Phaedrus77]

I noticed that UDF was written up twice on VIC in 2019 & 2020. I’m hoping those guys are still holding and have been in contact with Nexpoint (assuming they’re institutional investors). One recently posted a comment there about Nexpoint’s letter, so I assume they’re still holding.

Kind of funny that neither write up mentioned “executives sentenced to a combined 20 yrs in prison” as a risk factor. The 2019 relied on Greenlaw’s affidavit in the Bass case & bullshit from IR…something that I think we all did.

[Davlund]

I voted my shares with Nexpoint's people also. Udf's claims are too little, too late in my opinion. I just wish progressing to a new board of directors would come quicker than it will. If it does at all!

[Phaedrus77]

Udf filed a proxy statement, which contained no new info.

I wish NexPoint would hammer them on their “look at all our cash distributions” claims.

The distributions were either a) funded by a ponzi scheme (pre 2016 distributions) or b) were simply giving shareholders their money back (return of capital…post 2016).

UDF’s attempt to claim that the distributions mean something is beyond disingenuous.

[freddie me]

I voted by phone w Okapi, took ~30 seconds

[freddie me]

I voted all for Nexpoint nominees and against auditors

[Enterprising Investor]

Voted.

[Runaway27]

I realize that i may be screwed, blued and tattooed like most on this thread that are holding IV but what about UDF V, are they combining all or just concentrating on one of the issues, I've been holding 2700 shares of UDF V and only get a smidgeon of a dividend every 3 months which amounts to a Sammich and bottle of water!

[Phaedrus77]

UDF issued a new letter.

https://udfonline.com/category/udfiv/

Their communications always me irrationally angry. To refute the points in their letter one by one:

1) "In 2020, NexPoint launched a hostile tender offer, which it
extended 13 times, to purchase Trust shares at the bargain
basement price of $1.10 per share, or approximately a 90%
discount to the Trust’s book value per share at the time."

UDF knows damn well that NexPoint could not buy any shares in the tender offer due to its poison pill. Quit acting like shareholders are stupid.

2) NexPoint has launched numerous frivolous lawsuits against
the Trust — including a defamation suit — forcing the Trust to
spend resources that could otherwise be used for the benefit
of shareholders.

The only reason we're having this proxy contest is because of NexPoint's "frivolous lawsuits."

3) Their materials reinforce our belief that NexPoint’s true motivation behind its proxy contest is to extract the value of the Trust’s
portfolio for themselves to the detriment of all other shareholders.

Pure bullshit. We may not know what NexPoint's motives are, but we do know that Hollis & co. extracted value from the Trust for their personal benefit....who do you suppose paid all those lawyers in the execs' criminal trial?

4)The Trust has continued to
actively and professionally
manage its portfolio, including
originating 9 new loans since
2020, committing to lend over
$70 million in total.

They think originating 9 loans in 4 years is something to be proud of? How much have we paid them in fees over the last 4+ years to originate those 9 loans?

5)The Trust maintains
transparent communication
with shareholders...

The biggest lie of all. We went 6 (?) years without any financial information. The annual meeting last year consisted of 2 questions and they took no questions from attendees. We still only get annual information (7 months late). Anyone that's ever called UDF's IR knows that they are useless and provide no information.

6) As far as the dividends are concerned, they're paying out 26 cents annually on what was originally $20 of book value. That's a 1.3% return per year. Bravo UDF!

Dividends paid prior to 2015 don't mean anything, as they were funded via a ponzi scheme. That is like Madoff boasting about how much his early investors made.

[Dharmabumster]

Just voted my 2,685 shares for NexPoint!

[Phaedrus77]

Just voted all my shares.

[Phaedrus77]

There’s also the matter of the defendants’ ability to pay. Hollis is only making 15 cents an hour in the license plate factory for the next few years.

I hope they’re able to collect on the Moayedi loans.

[Enterprising Investor]

Clawbacks become highly likely with regime change. It will never happen otherwise.

Our nominees will implement necessary, fundamental changes in financial reporting and disclosures, review the use of shareholder funds for convicted former executives’ legal expenses and other potentially improper transactions, potentially seek to recover funds for shareholders, and hold the appropriate parties accountable

I was told last August by an attorney, whose firm specializes in this type of business litigation, that success is a function of corporate bylaws, underlying indemnity agreements, and governing state law.

[Enterprising Investor]

Vote GREEN!

[Enterprising Investor]

Notice of Proxy Statement for Shareholders of United Development Funding IV (UDF IV)

https://mma.prnewswire.com/media/2467986/NexPoint_UDF_IV_Shareholder_Letter_FAQs.pdf?p=pdf

[Enterprising Investor]

NexPoint Sends Proxy Materials to United Development Funding IV (UDF IV) Shareholders, Enabling Shareholders to Vote to Replace Trustees at 2024 Annual Meeting (7/24/24)

NexPoint Delivers Shareholder Letter, FAQs, and Proxy Materials Urging Shareholders to Vote Today FOR Paul S. Broaddus, Edward N. Constantino, John A. Good and Julie Silcock Using the GREEN Proxy Card

DALLAS, July 24, 2024 /PRNewswire/ -- NexPoint Real Estate Opportunities, LLC (together with its affiliates "NexPoint') today announced that it has sent proxy materials to fellow shareholders of United Development Funding IV ("UDF IV" or the "Company") for the 2024 Annual Meeting of Shareholders. NexPoint, which believes it is the largest shareholder of UDF IV, has nominated four individuals to the UDF IV Board of Trustees who will restore proper oversight at the Company and advocate for shareholders' interests.

In the proxy materials, NexPoint urges shareholders to exercise their voting rights and vote FOR Paul S. Broaddus, Edward N. Constantino, John A. Good, and Julie Silcock using the GREEN proxy card.

Along with the proxy materials, NexPoint sent UDF IV shareholders a letter with answers to frequently asked questions that highlights the urgent need for change at the Company and provides important information about the election and voting process.

These materials, along with other shareholder information and resources, are available at www.udfaccountability.com or directly via the following links:

Shareholder Letter - Notice of Proxy Statement for Shareholders of United Development Funding IV

Proxy Statement - Proxy Statement of NexPoint Real Estate Opportunities, LLC in Opposition to the Board of Trustees of United Development Funding IV

FAQs - Answers to Frequently Asked Questions FAQs for UDF IV 2024 Annual Meeting & Trustee Election

These communications outline how the Company's current Board has disenfranchised shareholders, defended and protected former executives who defrauded shareholders, misused shareholder funds, eroded the value of UDF IV shares, actively resisted efforts to restore transparency and accountability at the Company, and grossly misstated the acts and intentions of NexPoint in its fight for UDF IV shareholders. The incumbent Trustees must be replaced, and shareholders can now cast their vote to enact such change. With decades of REIT and asset management experience and a strong track record in corporate governance, NexPoint's nominees will restore transparency and accountability at UDF IV and act in the interest of shareholders to provide a path forward for the Company.

While the Company has not announced an Annual Meeting date, shareholders can vote TODAY using these proxy materials to enact long overdue change and elect Trustees who will work for all shareholders to maximize value at UDF IV.

NexPoint encourages shareholders to visit www.udfaccountability.com and complete the contact form to receive ongoing updates about the Company and the upcoming Annual Meeting.

Shareholders can also contact NexPoint via email at [e-mail].

About NexPoint

NexPoint Real Estate Opportunities, LLC is a wholly owned subsidiary of NexPoint Diversified Real Estate Trust, Inc. (NYSE: NXDT), an affiliate of NexPoint Advisors, L.P.

NexPoint Advisors, L.P. is an SEC-registered adviser on the NexPoint alternative investment platform. It serves as the adviser to a suite of funds and investment vehicles, including a closed-end fund, interval fund, business development company, and various real estate vehicles. For more information visit www.nexpoint.com.

IMPORTANT INFORMATION

NexPoint Real Estate Opportunities, LLC ("NexPoint") has delivered a proxy statement with respect to its solicitation of proxies for nominees to be elected to the United Development Funding IV ("UDF IV") Board of Trustees at the Annual Meeting of Shareholders of UDF IV. The date for the Annual Meeting has not yet been set. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE NEXPOINT PROXY STATEMENT (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) IN ITS ENTIRETY, AS IT CONTAINS IMPORTANT INFORMATION ABOUT THE PROXY SOLICITATION. Copies of the documents are available free of charge from NexPoint by accessing the website www.udfaccountability.com.

NexPoint, its affiliates, their directors and executive officers and other members of management and employees may be participants (collectively "Participants") in the solicitation of proxies by NexPoint. Information about NexPoint's nominees to the UDF IV Board of Trustees and information regarding the direct or indirect interests in UDF IV, by security holdings or otherwise, of NexPoint, the other Participants and NexPoint's nominees will be available in the proxy statement. NexPoint's disclosure of any security holdings will be based on information made available to NexPoint by such Participants and nominees. UDF IV is no longer subject to the reporting requirements of the Securities Exchange Act of 1934, as amended. Consequently, NexPoint's knowledge of significant security holders of UDF IV and as to UDF IV itself is limited.

CONTACTS

UDF IV Investor Contacts
Chuck Garske / Jeremy Provost / Theo Caminiti (Okapi Partners):
Email: [e-mail]
Phone: [phone]

For Additional Information/Updates on UDF IV
Website: www.udfaccountability.com
Email: [e-mail]

Media Contacts
Lucy Bannon (NexPoint): [e-mail]
Paul Caminiti/Pamela Greene (Reevemark): [e-mail]

NexPoint Investor Relations
Kristen Thomas: [e-mail]

https://www.prnewswire.com/news-releases/nexpoint-sends-proxy-materials-to-united-development-funding-iv-udf-iv-shareholders-enabling-shareholders-to-vote-to-replace-trustees-at-2024-annual-meeting-302204787.html

[Phaedrus77]

Well said.

[REITInvestor58]

NexPoint has stated in court filings that they made no trades, long or short, until April 2017 (long after the SEC began investing, long after the short selling and over a year after the highly publicized FBI raid) and that they were buying throughout 2017, 2018 and 2019 and even into 2020. They have publicly stated that they offered to collaborate with management to improve performance and transparency and were rebuffed by Greenlaw and the board. By the time the SEC announced the enforcement case and settlement, they had already invested more than anyone else, and their basis was significantly north of $1.25. They invested because they believed in the real estate. They have also publicly stated that they have spent well over $1 million of their own money fighting for transparency and a legitimate annual meeting. As the owner of nearly 10% of the company and after spending millions fighting for shareholders (which, I am confident, without such fight there would be no financials and no annual meeting), how can anyone legitimately question NexPoint’s motives. They are aligned with all the rest of us who have suffered the abuse of the past 8+ years.

[Phaedrus77]

I’d also point out that at the last shareholder meeting (the first one held in 8 years, and the first one held after its execs were sentenced to 20 yrs in prison), the company did not give shareholders the opportunity to question the execs.

The meeting lasted about 5 minutes and they answered two questions…1) they’d continue to fund loans and 2) the shares won’t be relisted on NASDAQ. All other questions were ignored.

THAT, and not Kenney’s flowery letters full of bullshit, is what the current management really thinks of shareholders.

[Phaedrus77]

If it was just a short & distort, the execs wouldn’t have been sentenced to a combined 20 years in prison.

The SEC was investigating prior to Bass getting involved.

There has been no proven link between Bass & Nexpoint. I believe Nexpoint has stated in court documents that they’ve never shorted the stock.

Nexpoint couldn’t buy any shares in its tender offer due to UDF’s poison pill (or equivalent). I believe it was simply a ploy by Nexpoint to get a shareholder list.

The “team” running the show now is pretty much the same team that was running the scheme. Kenney was an exec while Greenlaw and the other felons were running the fund “the same way they did in the past” (according to Greenlaw’s lawyer). I don’t think any of the other Trustees have changed since the convictions.

If Bass, the FBI and the SEC weren’t involved, chances are that UDF IV wouldn’t have written down these loans in 2023….but only because they would have been “refinanced” with new money from UDF VIII. You might have been better off, unless you also chose to invest in UDF VIII (or X or XX or however many funds Greenlaw needed to keep the scheme going).

Keep in mind, Buffington (UDF second largest borrower, I think) was bankrupt BEFORE Bass was ever involved. Buffington refused to roll his loans into UDF V because he knew he could never repay them. IIRC from the court transcript, Greenlaw supposedly cursed him out when he refused.

The reason shareholders are in this mess is because of Greenlaw and his cronies, not because of Bass.

I sincerely hope other shareholders don’t feel the same way you do.

[Dr Quest]

I imagine some firm will still purchase you shares for $1.25. I'll even purchase them for that price.

The question is, who do you trust more at this juncture? The "team" that drove the price into delisting due to short and distort then offers $1.25 or the "team" running the show now?

No doubt mistakes/ illicit activity transpired, but I would have been immeasurably better off if not for the "short and distort scheme" of some individuals/companies.

YMMV

[Phaedrus77]

They managed to lose $28 million last year. If you just read their propaganda, you’d think they’re doing a terrific job though.

https://files.constantcontact.com/7bf1ac3f301/b5bf15b9-d99c-4e7a-b694-fed021e4790d.pdf

If they’re doing such a bang up job, why did the FV of the stock grants drop from $8.16/share last year to $7.18 this year?

I sure hope the shareholders don’t fall for management’s bullshit.

[ofirm]

I do not dispute much, but the interest rates are supposed to be at 13% per year while the $10.5 is net with large allowances included in it.
That is where the value is - jv values, land values & large debt allowances.
only my 2 cents.

[Phaedrus77]

If I bought 1 share in the IPO, I gave the company $20. The company has given me ~$6 back in dividends and I still own 1 share with a book value of ~$10.50 (per the 2022 financials). That share is likely not worth book value, as the company does not make money and has loans at well below market rate.

With current management in place, I’d be lucky to get $5 for that share.

So someone that bought shares in the IPO has likely lost 50% of their money…investing in a real estate company during one of the biggest RE booms in history.

[ofirm]

You can not compare book value to ipo price. how much of the book value was also stuff capitalized but not real.
What you do need to compare is book value of $14 (+-) with 8% (interest of 13% - management costs & fees - 2% dividend).
that should be $14 x 1.08 ^ 10 (2014 - 2024) should have been $30.
if you assume $14 with 5% net book value increase only = $14 x 1.05 ^ 10 = $22.
actual net book value right now is $14.

[Phaedrus77]

I like how the execs brag about paying $6.06 of distributions since inception.

Book value at 12/31/22 was $10.65. It almost certainly declined in 2023.

$10.65 + 6.06 - 0.39 (dividends declared after 12/31/22) = $16.32.

The IPO was at $20.00.

Over the course of ~12 years, they’ve lost 20% of their equity…in one of the biggest bull markets in real estate history.

Yep, they should be awfully proud of themselves.

[Phaedrus77]

I feel like I’m living in a George Orwell novel.

[Enterprising Investor]

The first thing that came to my mind when reading this letter was a part of a Willie Nelson song often sung by Don Meredith on ABC’s Monday Night Football.

[Phaedrus77]

These guys have funded ONE new loan not related to existing projects in the past 4+ years.

How much have we paid them to generate that single loan?

How many loans have defaulted during those years?