Salt Pond Golf Course Special Assessment Terms and Conditions

The basic policies relating to the special assessment for acquisition of the golf course land and business are as follows:

· Interest and transaction costs on installment payments – Included in all first payments on November 5, 2007 is an allowance for closing costs. There are no interest or transaction fees for owners paying the full $5,000 special assessment up front or for owners paying the first $1,800 installment payment on time. The assessment payments, interest, and nominal transaction costs on the second and third installment payments are as follows:

On November 5, 2008 = $1,825
On November 5, 2009 = $1,825

· Late fee -- There will be a 5% late fee if payments are not received by Legum & Norman before the end of the established grace period- December 5, 2007. The second and third installment payments will be delinquent if payment is not received by December 5, 2008 and December 5, 2009, respectively.

• Additional interest if delinquent –If payments are not received when due – in this case no later than December 5, 2007, 2008, and 2009 -- additional interest will accrue to the delinquent homeowner. This rate will be based on the then applicable legal rate of interest, as provided for in the Salt Pond Declaration of Covenants, Conditions, and Restrictions (“Declaration”) and under Delaware law.

• Policy on delinquent payment – The Declaration further states: “If any Assessment is not paid on the date when due … such Assessment shall be deemed delinquent and shall together with such interest…and cost of collection, including reasonable attorney’s fees … continue as a lien on the lot or unit and any structure built thereon…”. For delinquent owners, privileges to SPHA recreational facilities will be suspended immediately after the grace period. SPHA can initiate foreclosure proceedings on the lien, and seek a legal judgment by which it can use legal methods to collect such judgment.

• If owner sells before the total payment is made – The current owner must disclose to the prospective buyer that there is a special assessment outstanding on the property. If the owner plans to settle or close on the property before the full amount of the assessment is paid, the entire payment (including interest and fees owed) is due and payable to SPHA at settlement. If the full payment is not paid prior to settlement, action, as defined in Article VI, Section 7, of the Declaration, can be initiated against the selling owner and a lien can be placed on the property. As defined in Section 8. Subordination of the Lien to the First Mortgage, “no sale or transfer shall relieve such lot from liability for any assessments thereafter becoming due to from the lien thereof”.

• If owner does not respond to assessment letter – If the owner does not respond to the assessment letter, the owner has waived the installment option and is deemed to have selected the full payment option and the full payment is due on November 5, 2007. If payment is not made by the end of the grace period, the collection process, late fee, and delinquency interest provision as defined in Article VI, Section 7, referred to above, can be initiated.

If the owner submits the assessment coupon and does not submit payment - In this case, Legum & Norman will contact the owner and ask for the owner to submit a payment. If no payment is submitted by the time the payment is due, the same policies as a “non-responding owner” will be initiated.

Important Note: If a SPHA owner does not return the coupon and payment by the end of the grace period (December 5, 2007), the owner waives the installment option and is deemed to have selected the full payment option.