A general overview of current cabin/interval details and projections for the completed project.

1. FISHERMAN’S COVE SUMMARY
1. AT PRESENT WE HAVE 18 CABINS BUILT OUT ON SITE. 16 OF THESE CABINS
ARE FULLY FURNISHED & COMPLETE AND ARE PRESENTLY IN A 40 YEAR RIGHT
TO USE MEMBERSHIP SALES & RENTAL POOL. THE REMAINING 2 CABINS ARE
DRIED IN AND CAN BE COMPLETE WITHIN THREE WEEKS AND ARE CURRENTLY
AVAILABLE FOR UNIT INTERVAL SALES.
2. THE ULTIMATE NUMBER OF CABINS FOR THE SITE WILL BE 42. THE
REMAINING 24 CABINS IN THE BUILD OUT WILL BE FUNDED BY THE RENTAL,
SALES, & MAINTENANCE INCOME FROM THE PROJECT. THE COMPLETION OF
THE REMAINING CABINS IS PROJECTED FOR SPRING 2015. THIS IS BASED ON
CURRENT INTERVAL SALES VOLUME OF (16) INTERVALS PER WEEK ($8500.00 EA)
WHICH WOULD EQUAL (70) INTERVALS PER MONTH. ONE CABIN EQUALS 75
AVERAGE ANNUAL/BI-ANNUAL INTERVALS.
3. AT PRESENT WE HAVE A 2400 SQUARE FOOT OFFICE BUILDING, 3200 SQUARE
FOOT CLUB HOUSE & RENTAL FACILITY, A GENERAL STORE & BAIT SHOP
FACILITY, AND SWIMMING POOL WITH ENTERTAINMENT DECK & BBQ AREA.
4. YEARLY MAINTENANCE FEE’S ARE $525.00 FOR AN ANNUAL SALE AND
$262.50 FOR A BI-ANNUAL SALE PER INTERVAL SOLD. THE 18 CABINS “UNITS”
INTERVALS PRESENTLY IN INVENTORY EQUALS A TOTAL OF 1,350 INTERVALS (18
UNITS X 75 AVERAGE ANNUAL/BI-ANNUAL =1,350 INTERVALS. THE 1,350
FIGURE IS DERIVED BY AVERAGING THE ANNUAL 52 WEEKS AND BI-ANNUAL 104
WEEKS INTERVALS (52 + 104 = 156 <> 2 = 78 USE AVERAGE 75). AS OF OCTOBER
1, 2013 819 INTERVALS HAVE BEEN SOLD.THE MAINTENANCE FEES WILL BE
BILLED OUT IN OCTOBER 2013 AT AN AVERAGE (ANNUAL $525.00 + BI-ANNUAL
$263.00 = $788.00 <> 2 = $394.00 EACH FOR A TOTAL INCOME OF (819
INTERVALS X $394.00 AVERAGE FEE = $322,686.00 $ TO BE COLLECTED
COMMENCING IN NOVEMBER OF 2013.
5. WHEN THE PROJECT IS BUILT OUT & SOLD OUT THERE WILL BE 3,150 (75 X 42
= 3,150) (ANNUAL & BI-ANNUAL) INTERVALS SOLD. THE YEARLY MAINTENANCE
FEE’S WILL BE BILLED OUT AT 3,150 INTERVALS X $394.00 AVERAGE ANNUAL/BI-
ANNUAL = $1,241,000.00. ATTACHED ARE CASH FLOW CHARTS & MONTHLY
COSTS. THE TOTAL OPERATION COSTS FOR FISHERMAN’S COVE IS $40,658.00

2. PER MONTH X 12 = $487,896.00 PER YEAR. THIS WILL LEAVE US WITH A
CONTINGENCY FEE OF $753,104.00 ($1,241,000.00 –<$487,896.00> =
$753,104.00).
6. ADDITIONAL INCOME INCLUDES SEASONAL RENTAL OF THE GENERAL STORE
& BAIT SHOP WHICH IS $1,500.00 PER MONTH. THE RENTAL INCOME FROM THE
ADDITIONAL OFFICE SPACE IN THE OFFICE BUILDING WHEN LEASED IS $1,500.00
PER MONTH.
7. THE RENTAL INCOME FROM THE CABINS AND CLUBHOUSE WHEN NOT
OWNER OCCUPIED IS APPROXIMATELY $3,000.00 TO $5,000.00 PER MONTH.
8. MEMBERSHIP SALES “LAKE CONROE FISHERMAN’S COVE ” IS A 40 YEAR
“RIGHT TO USE” CLUB, LICENSED WITH THE TEXAS REAL ESTATE COMMISSION.
WE SELL EACH CABIN/UNIT 52 WEEKS AND THE INDIVIDUAL SALES ARE CALLED
“INTERVALS”. WE HAVE SEVERAL SALES AND MARKETING TEAMS ONSITE &
OFFSITE SELLING MEMBERSHIPS EVERY WEEK. AN AVERAGE SALES PRICE OF AN
INTERVAL IS $8,500.00. WE ARE SELLING AN AVERAGE OF 35 INTERVALS (PER
MONTH) X $8,500.00 = $297,500.00 IN SALES PER MONTH.
A SAMPLE BREAK DOWN OF “ONE INTERVAL SALE” WOULD BE AS FOLLOWS:
SALES PRICE:……………………………………………………………………………… $8,500.00
MARKETING & TRAVEL EXPENSES:…………………………………………….. $2,125.00
SALES COMMISSIONS:……………………………………………………………….. $2,125.00
RCI AFFILLIATION:………………………………………………………………………. $ 225.00
CLOSING COSTS…………………..…………………………………………………….. $ 340.00
GROSS REVENUE $3,685.00
9. THE MONTHLY COG’S (COST OF GOODS), OVERHEAD, MAINTENANCE, DEBT
SERVICE, TAXES, MANAGEMENT, EMPLOYEE’S SALARIES, PAYROLL TAXES,
HOUSEKEEPING, INSURANCE, UTILITIES, AND FEES & LICENSE IS APPROX.
$55,000.00 (SEE ATTACHED CASH FLOW & MONTHLY COSTS). THE MONTHLY
GROSS REVENUE IS AS FOLLOWS: MAINTENANCE FEE’S $26,890.00 + RENTAL
INCOME’S $4,500.00 + MEMBERSHIP SALES INCOME $133,875.00 = $167,265.00
GROSS REVENUE LESS TOTAL MONTHLY COST’S $55,113.00 LEAVES A NET
MONTHLY REVENUE OF APPROX. $112,152.00. THIS MONTHLY NET REVENUE

3. AND CASH FLOW WILL BE ULITIZED TO BUILD OUT AND COMPLETE
CONSTRUCTION ON THE REMAINING 24 CABINS IN THE PROJECT
10. MERCHANT ACCOUNTS: AT THE PRESENT OUR MAIN MERCHANT ACCOUNT
IS WITH JACOBY LAW FIRM (ESCROW AGENT) WITH A MONTHLY CREDIT LIMIT
OF $2 MILLION DOLLARS PER MONTH. OUR MAINTENANCE MERCHANT FEE’S
ACCOUNT IS WITH GLOBAL PAY WITH A MONTHLY CREDIT LIMIT OF
$300,000.00.
11. WE HAVE AT THE PRESENT 531(1,350 – 819 = 531) INTERVALS IN OUR SALES
INVENTORY (1,350 – 819 = 531) THIS INVENTORY IS PART OF THE 18 UNITS THAT
ARE PRESENTLY BUILT OUT ON SITE. THE GROSS PROFIT GENERATED FROM THE
SALES OF THESE 531 INTERVALS X $3,685.00 WILL EQUAL $1,956,735.00.
12. THE CURRENT INVESTOR’S (LIEN HOLDER’S) ARE AS FOLLOWS: 1ST
MORTGAGE: SMART FINANCIAL, with a FIRST MORTGAGE OOF $1,500,000.00
MONTHLY PAYMENT OF $8,655.33.00. (PAYMENTS ARE CURRENT)