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Young Island Timeshare Program

Press Release: Plumrose Consulting, Inc.
November 15, 2002
TORONTO -- The Young Island Timeshare Program (the "Program"), introduced by Plumrose Consulting Inc. in early October at the CAIFA National Conference in Ottawa, provides Canadian purchasers with a significant tax benefit. In addition to contributing to the funding requirements of a charity, the purchaser will enjoy an after-tax rate or return of up to 40%, depending on Province of residence.

Plumrose Consulting is a boutique tax consulting firm, with a focus on providing innovative tax reduction strategies to medium to high income individuals. Plumrose is comprised of lawyers and accountants, with offices located in the heart of downtown Toronto and are committed to work with resellers of financial and tax product in Canada, providing marketing and sales assistance with strong after-market support.

The Young Island Resort was established over thirty years ago, as one of the first exclusive Caribbean resorts. The only "whole island" resort to offer a timeshare program, Young Island Resort is a five star luxury hideaway, located on a thirty-five acre island two hundred yards off the south coast of St. Vincent. Since its inception, Young Island Resort has been an elite vacation destination, catering to the vacationer that appreciates exclusivity, seclusion and all the amenities of a "five star" tropical private island retreat.

The Young Island Resort has thirty private villas, twenty-two of which have been dedicated to the Program. Amenities include a lagoon-style saltwater pool, five yachts (four 44 ft. yachts and one 50 ft. yacht) available for use by Timeshare owners, equipped with captain and chef, a groomed clay tennis court on cliff overlooking ocean with night lighting and a world-class restaurant featuring open-air huts with thatched roofs. All villas have a view of the ocean and a private, furnished terrace.

Jones Lang LaSalle ("JLL"), a leading NYSE-listed global provider of comprehensive real estate and investment management services, was retained to perform an appraisal of the Program and the Timeshares. JLL employs 7,200 professionals from offices in over 100 markets on five continents. JLL's investment management business is one of the world's largest and most diverse with US$22 billion of assets under management. JLL is focused on the hotel and tourism industry, with the first fully integrated global hotel real estate investment banking services group delivering advisory, transaction, financial and management services. The purchase prices for the Timeshares are supported by JLL's appraised values. The Timeshare purchase prices represent an approximate 40% discount to the weekly rates charged by the Resort.

The Timeshares provide the purchaser with the right to occupy one room at the Young Island Resort for one week every other year for each of the next 20 years. For the purposes of this article, we will assume a purchase price of $21,000 (Standard, low season). The purchase price is payable as follows:

1. a cash down payment of $2,100 (10% of the purchase price); and
2. a vendor take-back loan of $18,900 (90% of the purchase price). The VTB loan has no interest, is payable in 20 years and is secured by a pledge of the Timeshare.

Although not compelled to do so, a purchaser would obtain a significant tax advantage by donating the Timeshare to a registered charity. In return for a fee of $5,250 (25% of the purchase price), the purchaser will receive an unconditional guarantee relating to the outstanding amount of the loan. The $5,250 will be deposited into a trust, to be administered by HSBC. The guarantee allows the Developer to release the pledge on the Timeshare, thus facilitating the donation to the charity. The funds in the trust are to be invested in highly rated debt instruments ("A" or better) that provide a yield to maturity sufficient to satisfy the outstanding amount of the loan at maturity. The charity that receives the donation of the Timeshare will issue a receipt to the purchaser/donor for $21,000 (the purchase price), resulting in a tax credit that produces a net return of up to 40%, depending on the Province of residence.

The Young Island Resort is a member of Resort Condominiums International's ("RCI") exchange program. With more than 3,700 affiliated resorts in 100 countries, RCI is the world's largest timeshare exchange program, executing in excess of 2 million exchanges in 2001.

For more information on the Young Island Timeshare Program, please contact Plumrose Consulting at (416) 531-0005, or Toll Free at 1 877 840-2224.