Location: HOPC anticipates acquiring non-performing notes with properties as collateral located in a specific geographical area. HOPC will conduct a market evaluation to determine the appropriateness of the areas in which it will invest. This evaluation will give special attention to population movement and growth potential of the area.

Property Size/Type: As a general policy, HOPC will acquire any non-performing notes secured by any size one-to-four unit residential property including condominiums and townhouses. The residential properties can be owner occupied, non-owner occupied or vacant.

Deferred Maintenance: Residential properties that require considerable updating to meet building code requirements will be acceptable provided the acquisition price reflects the cost of needed maintenance.

Insurance: Prior to the acquisition of any non-performing note secured by an acceptable residential unit, HOPC will verify the homeowner insurance policy for each residential property and if the property does not have a current homeowner’s insurance policy, HOPC will purchase a new policy and make the acquisition provided that the acquisition price reflects the costs of the new homeowner’s policy.

Investment Amount: In principle, the acquisition price (not taking into account transaction costs) for any non-performing note secured by an acceptable residential unit at approximately seventy (70%) percent of the current value determined by HOPC. HOPC will determine the acquisition price based on internal market analysis. The HOPC market analysis will determine current market value and the acquisition price will be at approximately a thirty (30%) discount from that value. Operating Costs: HOPC will receive 5% of the estimated Real Estate value to be paid at the time of the acquisition of the notes.