Pepper Club

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Pepper Club

• The Hottest Address in Cape Town

2
The Investment

• Consists of
• An apartment
• A furniture pack by an international hotel
  interior designer
• A rental pool operated by experienced hotel
  operators
• OR
• An apartment to live in (not part of the rental
  pool)
• 1

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Mortgage Finance

• Investors are offered
• Guaranteed interest rate of PRIME MINUS 5
• Currently equates to 10.5 pa
• For 24 months
• On a 90 Mortgage Bond
• 2

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Payment terms

• Apartment Parking Bay
• 5 deposit 7 days from signature
• 5 deposit January 2009
• Balance of purchase price on Transfer
• Please Note Investors must purchase a standard
  furniture pack (not financed by the banks) priced
  from R120 000
• 3

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Projected Revenue

• 12 for the first year of operation (Dec 2009 to
  Dec 2010) increasing by 10 pa
• Or
• guaranteed 8 pa - for 2 years
• 4

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Taxation - Allowances

• UDZ Allowance
• 55 of unit cost
• 11 in the first year then 4.4 for 10 years
• Depreciation Allowance
• 20 pa on the cost of the Furniture pack
• Tax Deductable Interest
• Interest payable on all funds borrowed to finance
  the investment is tax deductable
• Assessed Tax Losses
• Tax Losses may be set off against any other
  taxable income or may be carried forward to
  following tax periods
• Expected to be legislated in October 2008
• 5

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Taxation Based on R1m Investment plus R150 000
Furniture Pack

• Net Mortgage Total Tax
• Rental UDZ Dep. Interest
  Allowance
• Year 1 138,000 (110,000) (30,000)
  (94,500) (234,500)
• Year 2 151,800 ( 44,000) (30,000)
  (94,500) (168,500)
• Year 3 166,980 (44,000) (30,000)
  (94,500) (168,500)
• Year 4 183,678 (44,000) (30,000)
  (94,500) (168,500)
• Year 5 202,046 (44,000) (30,000)
  (94,500) (168,500)
• Total 842,504 (286,000) (150,000)
  (472,500) (908,500)
• 6

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Total Return 90 Mortgage

• Net Capital Total
  Return on
• Income Appreciation Return Investment
• After
• Mortgage
• Interest
• R R R
• Year 1 43,500 115,000 158,500
  63.400 p.a.
• Year 2 57,300 126,500 183,800
  73.520 p.a.
• Year 3 72,480 139,150 211,630
  84.652 p.a.
• Year 4 89,178 153,065 242,243
  96.897 p.a.
• Year 5 107,546 168,372 275,917
  110.367 p.a.
• Average 85.767 p.a.
• Total 370,004 702,087 1,072,090
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INVESTOR 90 LOAN

• Projected Income Tax Free to Year 6
• Projected period to repay loan
• only out of projected income In year 8
• 8

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30 Days Free Usage

• An Investor may occupy his apartment for 30 days
  each year, free of rental.
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Pepper Club

• The Hottest Address in Cape Town
• Only the contents of Agreements signed by the
  parties may be relied upon.
• All other representations, written or verbal, are
  not warranted