DC4MS

When the destination club industry touts "asset protection", we are referring to the protections set in place by a club to protect members' deposits. If assets are properly protected, members will rest easy knowing their deposits will be returned under any circumstance. In addition, the means by which assets are protected by a club is a good indicator of the viability and sustainability of the club.

BelleHavens provides asset protection to our members differently than a non-equity club, in the following ways:

* BelleHavens is owned by its members. This is where the "equity destination club" comes from. We are a member-owned destination club.

* BelleHavens, Inc., the member-owned club, is structured as a non-profit organization that carries no liabilities (such as debt).

* BelleHavens (and its owner-members), hold title to a portfolio of million-dollar properties owned completely debt-free; there are no mortgaged homes or leases held by BelleHavens, Inc. We adhere to a 5:1 full member to wholly-owned-property ratio.

* BelleHavens membership deposits are placed in an escrow account until five full members join. At that point, a home is purchased outright with the members' deposits.

* Members' assets are only used to purchase wholly owned real estate - providing tangible real estate assets behind every deposit.

* BelleHavens members are not burdened with paying down debt or leases for the Club.

* BelleHavens employs strict and prudent financial guidelines when managing the Club, which we will not stray from. We do not discount deposits or annual dues, which puts current members' assets at risk.

* When the portfolio of homes owned outright by BelleHavens members appreciates, the appreciation is returned to the members, not the Club's management company. If a member resigns, he/she will receive back 90% of the future value of the membership deposit. As home prices appreciate, a membership will become more valuable, creating a need to increase the membership deposit price.

How is BelleHavens' asset protection different than non-equity destination clubs?

* In a non-equity club, members do not own the club that holds title to the real estate.

* Protection of members' deposits therefore, comes from a promise by the non-equity club to the members that their assets are protected.

* In most cases, a non-equity club promises that net assets will always exceed the amount needed to refund all membership deposits at the promised refund rate.

* BelleHavens has gone further than non-equity clubs in providing asset protection. We have given our members ownership of the assets backing their membership deposits. In non-equity clubs, the management company owns the assets backing the deposits and members have to rely on the management company's promise to properly manage these assets.