Return of Capital Re-filing - update November, 2000

To date, we have sent the Return of Capital portion of the following projects to Canada Customs and Revenue Agency (CCRA):

1107 Pacific Drive 2nd, 3rd & 4th
570 Dunsmuir
Angel Care 2nd & 3rd
Lee Balak
Caesars Landing
Cloverdale Mall 2nd & 3rd
Commonwealth
Blake Davie
Desert Springs
Emerald Estates 2nd, 3rd, 4th, 5th & 6th
Enterprise Business Park
Everbrite Ventures 2nd, 3rd & 4th
Fairways (Arrowhead) 2nd
Gaetz Crossing
Gateway Developments
Goodridge Peninsula
Grande Prairie Airport
Leewood Village
Mariner Ridge
Marlat Resources 1st & 2nd
Morewood
Nexus Ventures (3 mortgages)
Nitinat Subdivision
Paulsen Road
PG Specialty Wood (2 mortgages)
Riva Pointe
George & Sharon Rusin 3rd & 4th
Shuswap Falls
South Thompson Inn & Guest Ranch
Sterling Place
STS Quadra
Ucluelet
USCAN
Valleyview Heights
Wilmington River

We do continue to send in any `late' forms we receive.


We anticipate being able to send the following projects to CCRA by November 17, 2000:

Maxim Resorts
Michael Graye (Wailea)
Seasons Memorial Park
West Coast Golf Promotions
Southampton Antigua


We have held back the following projects from CCRA due to the fact that the loss on these projects appears to be less than the interest and fees received by the lenders:

Discovery Ridge
Fairways 1st
Petrochemical
Ravenswood
Shopkeeper


On October 27, 2000, CCRA provided PricewaterhouseCoopers Inc. with written direction on how Eron Financial Services (EFS), Eron Mortgage Corporation (EMC), Capital Productions Inc. (CPI) and Eron Investment Corporation (EIC) are to be handled for the Return of Capital re-filing process. We will be producing special mailings to all these projects' investors and expect to have the mailings completed by November 24, 2000. Simply, these projects will qualify for the Return of Capital re-filing, and the loss will be eligible to be treated as a Business Investment Loss (BIL).

CCRA have not yet processed the requested re-filings. We are encouraging them to process the re-filings as soon as possible. Re-filings for the Capital Loss carry-back forms will be done following clarification with lenders who completed the forms incorrectly.

Please do not call CCRA or PricewaterhouseCoopers Inc. to inquire about your re-filing. Should you have questions about the re-filings, David Craig will continue to give his assistance and he can be reached at (604) 713-6680.





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