Funded Construction Townhomes

1. Second Position Equity loan ­ Funded
Townhomes Homes LLC and
9126 Townhomes Investment LLC
c/o Mr. Charles Lee and Mr. K.C.
XXXX Allen Ave
Altadena, CA 91107
ATTN: Mr. T.A. and Mr. J. P.
RE: Loan No. 121205 ($1,010,000)
Townhomes Townhomes
9110 ­ 9126 Townhomes Avenue
Downey, CA 90240
Dear T. and J.,
The following are the general terms of our (“Boyd Groups” ) proposed equity loan.
Please return this letter with your signature and the service fee of $7,500 to our office no later
than March 12, 2013 or our proposal will be withdrawn.
Thank you.
Loan No. 121205
Loan Amount $1,010,000
Purpose of Loan To fund the Equity Requirement of construction lender
(First Choice Bank) to close construction loan and commence construction of the 17­unit
Townhome PUD development; including land payment ($700,000) and
payoff of past due property taxes ($200,000) bill. Secured Property 9110 ­ 9126 Townhomes
Avenue, Downey, CA 90240
Property Description Three parcels (comprising approximately 40,472
square feet) to be subdivided into 17 separate parcels prior to or concurrent with loan closing;
or, during course of construction subject to tentative map and
condition approved by BCG. Project Description Complete any site work (not yet completed
prior to loan closing); then commence construction of
seventeen townhome PUD development, each unit two – story, totaling approximately 32,880
SF (GBA), twocar garage each unit, plus 6 guest parking spaces in
common area of PUD development. Construction to be single phase. Townhomes Homes LLC
and 9126 Townhomes Investment LLC Loan No. 121205
March 6, 2013
Page 2
Property Owner (current) Townhomes Homes LLC and 9126 Townhomes Investment
LLC Applicant T.A., and J. P. Borrower Limited Liability Company, Special Purpose,
Bankruptcy Remote

2. Guarantor(s) Townhomes Homes LLC, 9126 Townhomes Investment LLC,
T.A, and J. P Project Manager T.A. and J. P.
Sales Agent (listing) UNK
Architect W. A, Inc. Civil Engineer Faramand Consulting Engineer
Structural Engineer Mid­Cities Engineering General Contractor W. A. Construction, Inc. Lien
Position (BCG) Subordinated (2nd) Deed of Trust
Term Twelve (12) months Option(s) To Extend Two 3­month options provided that construction
is substantially completed and provided Borrower pays
BCG $12,625 extension fee no later than fifteen (15) days prior to Maturity Date.
Interest Rate 9.75%
Amortization N/A
Minimum Interest $123,094 (15 months)
Property Value $2,900,000 (land “as is”); demolition and most of the
site work conducted during 2008 – 2009.
Projected Sales Revenue $420,000 Average Sales Price / House
x 17
$7,140,000 Gross Sales Revenues (“aggregate sales”)
(428,400) Selling Costs @ 6%
$6,711,600 Adjusted Gross Revenues
Construction Loan $3,100,000 First Choice Bank (18 mo. Term; fixed
interest at 6.5%; 1 pt. fee to the lender) Townhomes Homes LLC and 9126 Townhomes
Investment LLC
Loan No. 121205
March 6, 2013
Page 3
Profit (estimated) $3,611,400 Prior to BCG Loan
(900,000) Return of BCG Loan
(232,050) Deferred Fee BCG from House Sales
$2,479,350 Net Proceeds (profit)
Total Budget/ Project Costs TBD (budget to be revised and provided to BCG per
conference 2/4/13)
Current Indebtedness (to be retired) $2,900,000 (lender has agreed to DPO of $1,200,000)
Loan to Value(s) 43.4% First Choice Bank
57.6% BCG Loan
Loan To Cost 100% (not including the approximate $1,700,000
invested by Applicant prior to loan closing)
Impounds For Tax & Insurance Included in Construction Loan budget
Reserve Account $110,000 (funds to be deposited and escrowed at
Wells Fargo Bank and to be used to cover BCG loan
closing costs including broker points, one half monthly
interest cost, BCG finance fee, outside legal costs,
doc. prep., any required travel costs prior to or after

3. loan closing, outside inspectors, etc.).
Each month ½ of the payment due BCG will be paid
from this account; the other half will be paid directly
from the Borrower.
Any funds remaining in this Escrow Account to be
returned to Borrower upon final loan reconveyance
and full payoff.
Appraisal (or review) Contracted directly between BCG and appraiser.
Cost to be paid in advance by Applicant. BCG may
be able to use the appraisal hired by FCB.
Preliminary A & E Review Contracted directly between BCG and consultant.
Cost to be paid in advance by Applicant. (included in
Service Fee)
Architectural Review Contracted directly between BCG and architect. Cost
to be paid in advance by Applicant.
Loan Fee (BCG) $75,000
Brokers Points
Charles Lee) Two (2) points ($20,200)
Document Preparation $5,500
Townhomes Homes LLC and
9126 Townhomes Investment LLC
Loan No. 121205
March 6, 2013
Page 4
Legal Fee (add’l) If applicable
Deferred Fee 3.25% of the sales price of each house ($196,380)
(Deferred fee may be secured by a second deed of
trust)
Applicant Cash Required N/A
Applicant’s Capitalization $1,700,000 (approximately)
(amount borrower invested in project prior to loan
closing)
Holdback Reserve (Funded into
Trust A/C controlled by BCG)
See Above.
Partial Release Provision 95% of available proceeds but not less than $84,170
per unit (available proceeds equals gross sales price
minus sales commission, closing cost, and first
mortgage release price, but before mechanic
liens/construction related costs)
Special Provision(s) Borrower to provide lender with monthly progress
report no later than the 10th day of the following month.
All work described in the improvements budget must

4. be completed to satisfaction of lender no later than 12
months after loan closing. Borrower to be a special
purpose entity, single asset, bankruptcy remote.
Service Fee A Service Fee of $7,500 will be earned and payable to
BCG upon Applicant’s delivery of this signed letter to
BCG. Boyd Groups’ acceptance of this Service
Fee does not create or imply any agreement or
commitment by Boyd Groups or any of its affiliates to
issue a commitment or commitment letter. This Service
Fee is to compensate BCG for its due diligence
activities. On the closing date an amount equal to the
Service Fee will be credited towards the payment of
loan points and/or other fees owed to Boyd Groups
by Applicant. Otherwise this service fee is not
refundable.
Site Inspections Applicant will reimburse BCG for any out of pocket
costs related to Site Inspections.
Refundable Deposit(s) An additional deposit of up to 2% of the loan amount
will be required upon issuance of the loan commitment
but will be refunded to Applicant if BCG does not
close and fund the loan on terms described in the loan
commitment or on other terms that are otherwise
acceptable to the Applicant. Townhomes Homes LLC and 9126 Townhomes Investment LLC
Loan No. 121205
March 6, 2013
Page 5
Legal Fee Deposit Legal fee deposit may be required upon issuance of
commitment (non refundable against actual attorney
invoice) based upon anticipated legal fees, if any,
associated with loan closing.
Boyd Groups reserves the right to change the terms and the structure of this loan proposal
prior to our commitment if we receive information that affects our underwriting of the
sponsorship and/or the real estate. We look forward to doing business with you, assisting you
and closing this transaction. We promise to give you our full attention and we ask that you give
us the same. Thank you. http://www.theboydcapitalgroups.info/
Cordially,
T.N
T.N.