‘Secret Island Resort' Introduction & Terms of Investment

For Ocean Front Villa Lot Purchases

(Located at Gili Gede, SW. Lombok, Sekotong Propinsi) July 17 th , 2007

Hello interested Parties, Sir & Ladies,

 We think that Gili Gede Island, home of the still growing ‘Secret Island Resort' (SIR) is one of the most beautiful spots in the world; remarkably it is just beginning to be discovered by international travelers & investors.   Please allow us to reveal the secret to you.

Brief History – Peter & Suhartini Jones purchased the lower 44 area of SIR in October of 2002.   Title is held in Suhartini's name. There was an existing Bungalow nearly completed, a 12 x 12 metal-framed beginning structure, 1 brackish water Well and some Landscaping. Slowly but surely we developed this lower portion. We first completed the Restaurant/Kitchen/Pavilion including a 2 nd story Office/Bedroom, 3 bathrooms, a large open air Terrace and Basement storage area. (Basement area designed to include a Karaoke Bar and Fitness Room) There is a full Bar, Kitchen plus a regulation Ballard table and Lg. TV & Stereo for Entertainment We added two additional well water sources, one brackish and one fresh water, plus a roof rainwater run off system with several fiberglass large tanks. In 2005 we installed and reinforced the beach boundary with a cement and metal break wall & fence, including a south point U cement pier that contains the sand from beach erosion and provides another place for small boats to tie up in safety. The Tembowong Channel & Bay located between Gili Gede & the Lombok coast is considered the most protected natural ‘Marine Harbor' around Bali & Lombok.

* Note- Of all the 21 Lombok Gili islands, Gili Gede is the largest and has by far the greatest volume of fresh well water resources.

 We then purchased 4 double/1 single Kayak, a 6 meter ‘Fishing & Transport Tour Boat' (85 hp), placed three mooring for Cruising Yachts and local Charter Boats and had a Soft Opening blessing party.   Although we had occasional guests booking our two completed accommodations: We where able to purchase the upper 77 area portion of SIR giving us a three sided ocean view and present total of 1.21 hectare. We then concentrated on building our ‘Top of the Hill 2 bedroom Villa' with 2 double units below it, and began remodeling the previously existing two bed room ‘Wooden Villa'. It is now nearly completed as a 5 bedroom/unit Villa, plus the renovation of a ‘Traditional Rental Bungalow'.   Moving forward in late 2006 and 2007 we completed another ‘Vacation 3 Room Rental Units' structure, a 3 room ‘Staff House', ‘Titin's Toko Shop', 3 locked ‘Storage Spaces' and added lots more landscaping with ‘Sea shell Stone Walkways'. Plus there are 3 Gazebos and Gazebo hot Tub Facilities finished. We have also very nearly completed a large SW. Dock joining the land to sea where Yachts & their Skiffs may tie up and saunter to our ‘Yacht Club Bar & Restaurant'. We also hold a Indonesian patent called a ‘Kapal Transmigrasi' (Boat transformation) whereby a ‘House Boat' knock-down design is dry docked and attached to the Dock creating a stable ‘Bungalow on Top of the Reef'. The concept evolves from the many magnificent Bungalows permenently build on top of the reef in Tahiti. We are planning to add at least three of these unique non-permanent rental units as investment capital becomes available. Because we hold the Indonesian patent for this idea and invention, high Government officials have told us that it is only a matter of time for final approval as we complete the paperwork and raise the capital to build.   (But at this time we can make no warranties other than stated below).   For more information Please see www.secretislandresort.com -   Hotel premise licenses have been duly applied for and processed, but at this date we are still waiting for balance of payment before SIR grand opening.

Positive sales and Investment Characteristics of Gili Gede & ‘Secret Island Resort'-

1. – Gili Gede is the largest and has the highest mountains with fresh water than any other Gili island: And is arguably the most beautiful of all the 21+ Lombok Gili islands.
2.   – SIR's location on the Gili Gede's south peninsula with its three side scenic ocean views is unmatched by any other Gili Island and is located only 500 meters away from mainland Lombok car parking area. It is a short 5-minute x 5,000 Rp ride from Lombok's Tembowong beach landing to SIR. The three north Gili Aer, Trawongan & Meno islands takes 20 to 30 minutes to navigate and costs much more.
3.   – Land area prices in all of the 7 SW. Gili islands including Gili Gede & Sekotong are just beginning to raise as a few large developments like the 80 Villa unit project ‘Sundancer' near completion. Other large 4 & 5 Star Hotels are planed East of ‘Sundancer' and there are several beach front Villa's recently completed. There are two hotels located closer to Banko Banko famous surf spot: The ‘Bola Bola' and a Private Hotel complex near Laubuhan Poi where the Lombok government is planning to build a Ferry harbor. There is a high class Villa project established with some infrastructure on the point of Land nearest to Gili Asaha, the last SW gili island close to Banko Banko.
4.   – SIR geographical position is the most well protected natural harbor for more than a hundred miles around. It is literally a huge area whereby large and small Yachts can find flat water anchorages and moorings.
5.   – There is a Gasoline station combination Boat Fuel dock already built at Tembowong village Landing just 500 meters away from SIR's beach & dock side. It has just opened and will surly draw many ocean going Yachts and Fishing vessels to the area as the secret location of these waters travels far and wide via Air Land & Sea.
6. -   There will be more and more Cruising Yachts seeking out this excellent area which will soon bring about the construction of a full service Yacht harbor Marina with all its surrounding commercial growth projects following making the value of adjacent land value climb some more.
7.   – The southeast beach entrance to SIR is the only beach that is clear of any reef obstructions for Swimmers in all of Gili Gede.   It is an excellent swimming beach, yet the West side beach has an excellent snorkeling as well as a sandy outlet to the deeper ocean where the dock has been build.
8. -   The upper 77 area of SIR's landscape are visually separated from the lower 44 Recreation Park Restaurant area creating a excellent sense of privacy for the Villa Lot Owners and Guests.
9.   – There are very beautiful nature walks possible on Gili Gede, just a short hike up the nearby Hill Side for a stunning 4 point compass View of all the 7 Gili Islands and the surrounding Sekotong area..

 There are many reasons to visit our island area, We hope that you will join us soon.

Cost of Villa Lots For Sale -   ( Dimensions approximate & no warranties are made until time of purchase )

Contract Terms   –

•  Each Villa Lot is available for Foreigners via a 75-year Lease with up to an automatic maximum renewable extension term possible according to Indonesian law, not to exceed 75 years. Maximum lease term 150 years.

•  Indonesian Citizens may Lease lots for the same 75 year terms stated above for Foreigners, but may also buy a ‘Option to Purchase lot right' for a additional $5,000 at first signing and a additional $5,000 at time of legal transfer of Title Certificate (Hak Milik).

•  ‘Option to Purchase' right must be executed and new title certificates issued to all parties no later than 10 years from first contract date signing. Seller is obliged to make available whatever ‘Non-Cost' support required.

•  All costs of dividing land Lot Title Certificates will be born by the Buyer, including land Surveys.

•  Buyer will pay a 50% down payment to enable the Seller to start and finish the construction of the below mentioned ‘Promised facilities' within 6 months of contract signing & down payment. The final 50% lease balance payment is due and payable no later than one month after SIR writes a letter of completion of Promises issuance.

Lessee & Seller Obligations and Rights in Common -  

1. Each ‘Lease Holder Lot Buyer' will be supplied with a reasonable daily fresh and brackish water supply allotment of at least 100,000 liters of Fresh well water from either on site sources or via transport from Lombok Island; and 200,000 liters of Brackish on site well water.

SIR management will install two at least 100 & 200 litter capacity water tanks at top of each lot within 3 months of initial contract signing. SIR will fill each tank daily when either the Owner, construction workers or a registered Guest are occupying the premises. Additional supply of water may be ordered by Lessee/Buyer but may be charged for at local competitive rates + 15% if available.

2. Each ‘Lease Holder Lot Buyer' will be supplied with 220 volt electricity & meter via either SIR diesel Gen-Set engines (10 to 20 KV multi Gen-sets) or via PLN government sources when they are finally installed as verbally promised.   SIR Gen-set Electricity may be charged at nearly the same rate as PLN charges, but will not exceed it. Sir will endeavor to follow a calculated rate charge relative to machine maintenance, repair, labor and fuel cost + 15%.   SIR would like to install an approximately 5KV Wind Generator system, but is still constrained by capital investment costs of up to $20,000 and thereby makes no warranties or obligations at this time.   But the cost will no doubt become more and more cost effective each year as fuel becomes more expensive.   Any private Gen-sets that you may choose to use and install must be sound proof via insulted casing and under ground exhaust.  

3. Each ‘Lease Holder Lot Buyer' may use any professional team of workers or Contractors it wishes to construct a Villa, House or Bungalow on its land lot according to legal standards of the Government and Industry. But due to the politics of the local Gili Gede and nearby Lombok village culture: SIR requires that you employ 50%, but no more than 15 of your workers from Gili Gede and nearby Lombok villages. We have at least 15 workers that we can recommend that have worked with us over the last 5 years.   The SIR construction team and manager (Pak Adhi) are available to build all of your project or part of it at a cost plus 15% rate.   Approved Architectural drawings and licenses are required before Construction may begin.   SIR has a few designs that it favors and can help you get fast and less expensive approval.

4. Each ‘Lease Holder Lot Buyer' has continual right of Free or Discounted Use rates for the use of SIR's following Resort facilities. – as defined below.

;; Restaurant, Bar & Outdoor Land & Sea Facilities,

A. - Free use and enjoyment of Fitness Room, DVD & Satellite Video Music and Billiards Table via sign up sheet whereby fair consideration ; will be given to other SIR Guests, Villa Owners and Customers.

B. - 20% Drinks and Food discount to all Villa Lot Lessee/Owners, Spouse and their Children.

C. - 20% Private Party discount for all Villa Lot Lessee/Owners, Spouse and their Children booked in Advance.

D. - 20% discount for SIR planned Massage & Salon facilities for all Villa Lot Lessee/Owners, Spouse and their Children.

E. - 20% discount for use of SIR Marine Equipment (Kayaks, Sailing & Fishing speed boats) for all Villa Lot Lessee/Owners, Spouse and their Children.

F. - Free use of promised to be completed ‘Swimming Pool' no later than 6 months from signing date of Lease/Buy contract.

G. - Free use of Docks if needed to moor or tie up a small boat with consideration of Rental Guests staying in planned ‘Bungalows on top of the Reef'.

H. – Free use of pool side Barbeque, present Gazebos and Gazebo Pirates Hot Tub Facilities including all outdoor furniture within the Park ‘In common defined area ‘, in both Upper & Lower areas.

5. – Seller/SIR management Infrastructure 1 year Obligations - to be completed 1 year from sale date of 1 st lease contract signing

A. – Finish Build and maintain a l0 x 6 meter Oval Swimming Pool as shown on Brochure

B. - Finish Build and maintain 3 more upper fresh water wells & 12 x 10 meter Reservoir as shown on Brochure

C. - Finish Build and maintain a L shaped Dock with 30+ meter boardwalk joining land as shown on Brochure

6. – Seller/SIR Management Infrastructure 2 nd Sale Obligations - to be completed 1 year from sale date of 2nd lease contract signing

A. - Finish Build and maintain a separate 10 x 6 meter Salon & Meeting room structure within the lower Park 44 area.

B. – Purchase, install and maintain a additional larger 15 to 20 KV Diesel Gen-set for the term of the 75 year contract.

C. – Charge and collect a monthly ‘Equipment Maintenance & Security Fee' from each sold Villa Lot starting 1 year from sale date of 1 st lease contract signing. The monthly amount will start at 250,000 Rp per month and may be subject to a ‘Not More than 10% increase per year' solely at the discretion of SIR management.

D. – The Villa Lot lessee/Owner has the right to use or not to use, SIR management to Care-take and Rent its Villa or Bungalow structure.   Terms offered by SIR management are presently set at 50- 50% split of per day revenue not including 15% government tax & agent commission to be negotiated.  

E. – Sir will maintain all necessary Hotel/Resort and government licenses legally required to insure the quality and long term enjoyment of the Lessee/Buyer investment for the duration of the 75 year plus Lease contract. Eventual Land purchases and sub divisions will be the responsibility of the Land Purchaser.

Sincerely,

Suhartini & Peter Jones,

Pt. Layar Indah – Dba – ‘Secret island Resort'