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MHC America Fund, LLC

For any questions on your current investment, please contact the managers as you normally would.

MHC America Fund, LLC

888-642-2007
info@mhcamerica.com

110 NW 2nd Street
Cedaredge, Colorado 81413


This is not an offer. Securities can be offered by the prospectus only, which should accompany or precede this material. Since investing in MHC America Fund, LLC is not suitable for all investors, the prospectus should be read carefully by an investor before investing. Investors are advised to consider the investment objectives, risks, charges and expenses before investing. The prospectus, which is available at MHCAmerica.com, and may also be obtained by calling 888-642-2007, contains this and other information about MHC America Fund, LLC.

Our mission is to provide an excellent return on investment for investors, while at the same time providing every resident with a safe and affordable place to live.

2 Distributions are not guaranteed and may be suspended, modified or terminated at the discretion of the Manager. Future distributions may include a return of principal or borrowed funds, which may lower overall returns to the investor and may not be sustainable.

The information herein does not supplement or revise any information in the Private Placement Memorandum. To the extent information herein conflicts with the Private Placement Memorandum, the information in the Private Placement Memorandum shall govern.

There are no assurances that the stated objectives will be met.

MHC America Fund, LLC does not provide investment, legal or tax advice.

This is not an offer. Securities can be offered by the prospectus only, which should accompany or precede this material. Since investing in MHC America Fund, LLC is not suitable for all investors, the prospectus should be read carefully by an investor before investing. Investors are advised to consider the investment objectives, risks, charges and expenses before investing. The prospectus, which is available at MHCAmerica.com, and may also be obtained by calling 888-642-2007, contains this and other information about MHC America Fund, LLC.

Risk Factors

Investment in the Company involves various risks, including certain risks associated with the lack of liquidity of the investment, risks associated with the real estate industry, regulatory risks, and federal income tax risks. The Manager, by virtue of holding Class C Interests and/or its Fees, may have certain conflicts of interest with the Class A Members and/or Class B Members as further described herein.

An investment in the Units involves a significant degree of financial risk and, accordingly, a prospective Investor should consider carefully all of the risk factors described below. This Offering is intended only for persons who understand the risks and their consequences and who are able to bear the risk of loss of their investment. The following list is not intended to be an exhaustive list of the risks associated with this Offering, and prospective Investors should consider factors set forth elsewhere in this Memorandum before making their investment decision and discuss them with their own advisors, which may include attorneys, accountants, and/or investment advisors, as prospective Investors deem necessary.

Risk Factors Related to the Company

Risk of Failure to Comply with the Private Placement Exemption
This Offering constitutes the sale of securities. It is being made pursuant to an exemption from registration available under the United States Securities and Exchange Commission's (SEC's) Regulation D, Rule 506(c). In order to maintain the Company’s exemption, the Manager shall ensure reasonable compliance with the rules of the exemption, including, but not limited to, the prohibition against commingling of funds between other investments or companies operated by the Manager, the duty to not misrepresent and/or omit any material facts, and the filing of the requisite notices with both the Federal and State securities regulatory agencies. If the private placement exemptions relied upon are not available to the Company and/or its Manager for any reason, the Company and its Manager may be required to offer to the Investors the right to rescind their purchase of Interests, which could have a material adverse effect on the Company, its business, and its financial condition. There is no assurance that the Company and/or its Manager would have adequate funds to repay its Members if such rescission were required.
The Company’s risk is expected to be substantially mitigated by having experienced securities attorneys assisting with the preparation of this Offering and the preservation of compliance with the applicable exemption.

The Company's Success Depends on Performance of the Manager
The Company's ability to achieve its investment objectives and to pay distributions is dependent upon the performance of the Manager with respect to certain decisions to be made by the Manager, in its sole judgment and discretion, including, but not limited to: (a) selecting an appropriate property to acquire; (b) overseeing third party service-providers during the formation of the Company and due diligence for each Property; (c) overseeing the Property Manager, construction contractors, professionals, and suppliers during Property operations; (d) finding and determining appropriate financing arrangements for acquiring and/or refinancing Company Property; (e) managing the Company in accordance with its Limited Liability Company Agreement on behalf of its Members in such a manner as to produce cash flow and/or equity upon resale; and (f) selecting the appropriate methods to market and dispose of Company Properties; etc. The Manager will be relying upon its own prior experience with similar investments and the assistance of its professional team members to further the Investment Objectives of the Company when making such decisions in the judgment and discretion of the Manager.

The Manager May be Unable to Retain Key Personnel
A loss of key personnel of the Manager, or contractor personnel integral to operation of the Property during the course of business of the Company could have a detrimental effect upon the Company. The Manager will attempt to develop relationships with alternative, local service providers in the event of termination or failure of its team members to perform as anticipated. Further, the Manager may hire its own employees and/or an Affiliate to provide such services at rates commensurate with local providers, if acceptable service providers are not available in the marketplace.

Lack of Control and Limited Voting Rights of the Class A Members and Class B Members
The Manager will make all decisions with respect to the management of the Company. The Members will have no right or power to take part in the management of the Company and, except as expressly provided in the Agreement, the Class A Members and the Class B Members have no voting rights. The Manager may be removed only under certain limited conditions set forth in the Agreement.

Members' Actions Could Jeopardize Their Limited Liability
The liability of each Member will be limited to their investment in the Company assuming compliance with the laws of each jurisdiction where the Company operates, compliance with the Agreement, and observation of applicable formative and qualification requirements of a limited liability company in Delaware. However, if a Member participates in the control of the business of the Company and/or acts outside its authority as a Member in such a way that binds the Company, such Member may be held liable for Company obligations in its own right and/or to the same extent as the Manager in certain circumstances.

The Offering Is Being Made on a Best Efforts Basis
The Class A Units and Class B Units hereby offered are being sold on a "best efforts basis", with respect to the Minimum Dollar Amount and on a "best efforts basis" with respect to the sale of the remaining Class A Units and/or Class B Units up to the Maximum Dollar Amount or the Extended Maximum Dollar Amount, as applicable. Accordingly, there can be no assurance that any or all of the Units will be sold. No commitment has been made by anyone to purchase any or all of the Units offered herein and no commitment will be accepted until a Member represents and warrants in their Subscription Agreement (see Exhibit 3 hereof) that such Member has read and understands all of the documents associated with this Offering that have been provided by the Manager and that such Member meets the financial and/or other necessary qualifications for Membership as set forth in Section 1 hereof.

The Company Does Not Guarantee a Return on Investment
The Company makes no representations and/or warranties with respect to any return on an investment in the Company. There can be no assurance that a prospective Investor will receive any return on an investment in the Company and/or realize any profit on such prospective Investor's investment in the Company.

The Offering Price for Each Unit Has Been Arbitrarily Determined
The price for individual Class A Units and the price for individual Class B Units offered herein have been arbitrarily determined by the Manager and do not necessarily bear any relationship to the Properties, book value, earnings and/or net worth of the Company or any other established criteria of value.

Lack of Capital May Impede Achievement of Investment Objectives
There is a risk that the amount of capital raised in this Offering will be insufficient to meet the Investment Objectives and/or operational requirements of the Company. If the Company raises only the Minimum Dollar Amount, the Company may not have sufficient proceeds to fully implement its Investment Objectives with respect to the Properties. Alternatively, even if the Company raises the Maximum Dollar Amount or the Extended Maximum Dollar Amount, as applicable, improvement and/or operation costs may be greater than expected. In either case, a reduction in the amount of funds available for capital improvements to the Properties may result in decreased rental payments for the mobile home lots in the future, which could decrease the cash available for distribution to Members.

If there is a shortage of capital necessary to meet its Investment Objectives, the Manager will use its best efforts to obtain funds from a third party. Obtaining funds from a third party may require an increase in the amount of financing that the Company will be obligated to repay. In addition, there is no certainty that funds from a third party will be available at a reasonable cost, if available at all, and the Manager may need to sell additional Interests, which could dilute the Interests of the Members.

Specifically, and solely with respect to non-real estate secured loans, the Manager will consider first obtaining funds from Members to satisfy any such shortage in capital. If the Manager is unable to obtain such funds from Members, the Manager will then consider obtaining funds from a third party. Obtaining funds from a Member and/or third party may require an increase in the amount of financing that the Company will be obligated to repay. In addition, there is no certainty that funds from a Member and/or third party will be available at a reasonable cost with respect to non-real estate secured loans, if available at all, and the Manager may need to sell additional Interests to Members, and if there is still a shortage of necessary capital, the Manager may need to sell additional Interests to prospective Investors, which could dilute the Interests of the Members.

Company Has No Track Record
The Company is newly formed and has no operational history. It will be managed by the Manager. However, the members of the Manager that will be making investment decisions on behalf of the Company, have significant prior experience in negotiating, purchasing, operating, managing and selling mobile home parks. See the Manager's biographies and Track Record included in Exhibits 4 and 5 hereof.

Limited Transferability or Liquidity of Class A Interests and Class B Interests
The Interests are being offered and sold without registration under the Securities Act, and without registration or qualification under the securities laws of any state, in reliance upon the exemptions from registration provided by Sections 3(b) and 4(2) of the Securities Act and Regulation D, Rule 506(c) promulgated thereunder and certain exemptions from registration and/or qualification under applicable state securities laws and regulations. When subscribing for Interests, each Member agrees to not resell or offer for resale any of the Interests, unless the Interests are registered and/or qualified under the Securities Act and applicable state securities laws, or unless an exemption from such registration and qualification is available therefor. Furthermore, the Manager may, in its sole discretion, prohibit any transfers that could: (a) cause the Company to be characterized as a “publicly traded partnership” for tax purposes; (b) violate the Securities Act or any rules or regulations thereunder, or any applicable state securities laws or any rules or regulations thereunder; (c) subject the Company to the reporting or registration requirements of the Securities Exchange Act of 1934; and/or (d) result in the treatment of the Company as an association taxable as a corporation.

The Company is under no obligation to repurchase Units from the Members, and it is not anticipated that there will be a public market for the Units. The Manager may, but is not obligated to, assist Members in reselling their Units under certain circumstances when such resales are made in compliance with applicable securities laws. There can be no assurances that a Member will be able to liquidate its investment prior to the liquidation of the Company. Units, therefore, should be purchased only for long-term investment.

The transferability of the Units is substantially restricted by the Securities Act and state securities laws. The transferability of Units also is substantially restricted under the terms of the Agreement, which provides that a Member may not sell, transfer and/or assign its Units without the prior written consent of the Manager. Further, under certain circumstances, the Manager has the right to prohibit the transfer of a Member’s economic interest in the Company. An assignee of Units may be substituted as a Member only with the consent of the Manager, in its sole discretion, using assignment forms required by the Manager. Because any classification of the Company as a “publicly traded partnership” would significantly decrease the value of the Units, the Manager intends to exercise fully its right to prohibit transfers of Units under circumstances that could cause the Company to be so classified.

Contingent Distributions
As noted elsewhere herein, all distributions to the Members will be contingent upon the Company having adequate cash flow, as determined by the Manager, in its sole discretion, to make such distributions after payments of debts, expenses and other Company obligations. In addition, the Members’ investment return from the Company is expressly contingent upon the Company realizing and/or furthering certain economic objectives. There can be no assurance that such economic objectives will be attained, and even if such economic objectives are attained, that the Company would then have the cash flow necessary to make such additional distributions to the Members.

Lack of Diversification
The Company will own no significant assets other than the Properties. The success of the Company, therefore, will be dependent upon the success of the Properties and its successful management and operation by the Manager.

Special Risks for Investors Who Acquire More Than 20% of the Equity Interests

Such Investors May Be Subject to the Bad Actor Provisions of Rule 506(d)

Regulation D, Rule 506(d) was adopted by the SEC under the JOBS Act on September 23, 2013. Rule 506(d) pertains to Investors ("covered persons") who acquire more than twenty percent (20%) of the voting (equity) interests in companies seeking an exemption from securities registration under Rule 506. If such Investors have been subject to certain “disqualifying events” (as defined by the SEC), they are required to either: (a) disclose such events to other Investors (if they occurred before September 23, 2013); or (b) own less than twenty percent (20%) of the voting (equity) Interests in the Company (if they occurred after September 23, 2013); and they may not participate in management or fundraising for the Company.

Disqualifying events are broadly defined to include such things as criminal convictions, citations, cease and desist or other final orders issued by a court, state or federal regulatory agency related to financial matters, Investors, securities violations, fraud, or misrepresentation.
Investors or other covered persons who do not wish to be subject to this requirement should: (a) acquire less than twenty percent (20%) of the voting Interests in the Company (or ensure that the Interests they acquire are non-voting); and (b) abstain from participating in management or fundraising for the Company. Covered persons have a continuing obligation to disclose disqualifying events both: (a) at the time such covered person is Accepted to the Company; and (b) when such disqualifying event occurs (if later), for so long as such covered person is participating in the Company. Failure to do so may cause the Company to lose its Rule 506 securities exemption.

Investors Not Represented by Manager's Counsel
The prospective Investors, as a group, have not been represented by independent counsel in connection with the formation of the Company and/or this Offering. The Offering documents, including this Memorandum, the Agreement, the Subscription Booklet, and any amendments thereto have been prepared by counsel for the Manager, Lowndes, Drosdick, Doster, Kantor & Reed, P.A., Orlando, Florida (“Lowndes”). Lowndes will not be representing Investors in connection with their investment in Units in the Company.

Consequences for a Default on the Property Management Agreement
The Company will enter into a Property Management Agreement with Property Manager to serve as the onsite manager of each of the Properties to direct, supervise, manage, and operate the Properties on a day-to-day basis. The Property Management Agreement for each Property will be for a term of ten (10) years and the Company may incur a penalty if a Property Management Agreement is terminated prior to the expiration of its term due to an event of default caused by the Company.

Risks Related to Owning Real Estate

General Risks
Factors which could affect the Company's ownership of income-producing Property may include, but is not limited to, any or all of the following: changing environmental regulations; adverse use of adjacent or neighboring real estate; changes in the demand for or supply of competing Property; local economic factors which could result in the reduction of the fair market value of a Property; uninsured Losses, significant unforeseen changes in general or local economic conditions; inability of the Company to obtain any required permits or entitlements for a reasonable cost, on reasonable conditions, or within a reasonable time frame, or to obtain such permits or entitlements at all; inability of the Company to obtain the services of appropriate consultants at the proposed cost; changes in legal requirements for any needed permits or entitlements; problems caused by the presence of environmental hazards on a Property; changes in federal or state regulations applicable to real property; failure of a lender to approve a loan on terms and conditions acceptable to the Company; lack of adequate availability of liability insurance, all-risk, or other types of required insurance at a commercially-reasonable price; shortages or reductions in available energy; and acts of God or other calamities. Furthermore, there could be a loss of liquidity in the capital markets.

Liability for Environmental Issues
Under various federal, state and local environmental and public health laws, regulations and ordinances, the Company may be required, regardless of knowledge or responsibility, to investigate and remediate the effects of hazardous or toxic substances or petroleum product releases (including in some cases natural substances such as methane or radon gas) and may be held liable under these laws or common law to a governmental entity or to third parties for property, personal injury or natural resources damages and for investigation and remediation costs incurred as a result of the real or suspected presence of these substances in soil or groundwater beneath a Property. These damages and costs may be substantial and may exceed and insurance coverage the Company has for such events.

Buildings and structures on a Property may have contained hazardous or toxic substances, or have released pollutants into the environment; or may have known or suspected asbestos-containing building materials, lead based paint, mold, or insect infestations (such as roaches or bed bugs), that the Company may be required to mitigate.
The Manager will attempt to limit exposure to such conditions by conducting due diligence on each Property, however, all or some of these conditions may not be discovered or occur until after such Property has been acquired by the Company.

Uninsured and Underinsured Losses; Availability and Cost of Insurance
The geographic area in which the Properties are located may be at risk for damage to property due to certain weather-related and environmental events, including such things as severe thunderstorms, tornadoes, snowstorms and earthquakes. To the extent possible, the Manager will attempt to acquire insurance against fire or environmental hazards. However, such insurance may not be available in all areas, nor are all hazards insurable as some may be deemed acts of God or be subject to other policy exclusions.

All decisions relating to the type, quality and amount of insurance to be placed on the Properties are made exclusively by the Manager, in its sole discretion. Certain types of losses, generally of a catastrophic nature (due to such things as ice storms, tornadoes, wind damage, hurricanes, earthquakes, landslides, sinkholes, and floods) may be uninsurable, not fully insured or not economically insurable. This may result in insurance coverage that, in the event of a substantial loss, would not be sufficient to pay the full prevailing market value or prevailing replacement cost of a Property. Inflation, changes in building codes and ordinances, environmental considerations, and other factors also might make it unfeasible to use insurance proceeds to replace the Properties after the Properties have been damaged or destroyed. Under such circumstances, the insurance proceeds received might not be adequate to restore the Properties.

Furthermore, an insurance company may deny coverage for certain claims, and/or determine that the value of the claim is less than the cost to restore the Property, and a lawsuit could have to be initiated to force them to provide coverage, resulting in further losses in income to the Company. Additionally, the Properties may now contain or come to contain mold, which may not be covered by insurance and has been linked to health issues.

Federal, State and Local Regulations May Change
There is a risk of a change in the current Federal, State and Local regulations as it may relate to operations of a Property in the area of fuel or energy requirements or regulations, construction and building code regulations, approved property use, zoning and environmental regulations, or property taxes, among other regulations.
The Manager will attempt to limit exposure to such circumstances by conducting due diligence on each Property prior to acquisition, however, some of these changes are unforeseeable and may not be discovered or occur until after such Property has been acquired by the Company.

Lack of Liquidity
Real estate investments are relatively illiquid as compared to other investment opportunities, as the primary means to recover a Member's investment in real estate is upon the refinance or resale of the real estate, which often may not be feasible until some passage of time and/or operational history has accrued. Such illiquidity of real estate investments generally, may limit the Company's ability to return Capital Contributions to the Members until such time as all Company Property is refinanced or sold.

Compliance with Americans With Disabilities Act
Under the Americans With Disabilities Act of 1990 (the ADA), all public accommodations are required to meet certain federal requirements related to access and use by disabled persons. A determination that a Company Property contains a public accommodation that is not in compliance with the ADA could result in imposition of fines or an award of damages to private litigants. If substantial modifications are made to comply with the ADA, the Company's ability to make distributions to its Members may be impaired.

Risks Related Owning Mobile Home Parks

Market and Economic Conditions May Impact Revenue from Property Operations
Local conditions in the market of each mobile home park may significantly affect occupancy, rental rates, and the operating performance of a Property. The risks that may adversely affect the Properties include the following:
- Plant closings, industry slowdowns and other factors that affect the local economy.
- An oversupply of, or a reduced demand for, mobile homes.
- A decline in household formation or employment or lack of employment growth.
- Rent control or rent stabilization laws, or other laws regulating mobile home parks, that could prevent the Company from raising lot rents or selling mobile homes.
- Economic conditions that could cause an increase in the Company's operating expenses, such as increases in property taxes, utilities, compensation of on-site associates and/or routine maintenance.

Market and Economic Conditions May Impact the Property Value on Resale
The sale price of a Property is likely dependent upon the condition of the economy in the area where such Property is located. The Manager anticipates holding each Property for up to ten (10) years, or longer. There is a risk that at the time of the projected sale, the marketplace may be different than projected, which may require that the Company hold a Property longer than anticipated, and/or sold at a loss. Despite the Manager's projections, an Investor should be prepared to leave their Capital Contribution with the Company until all Properties owned by the Company are sold.

Competition Could Impact Occupancy or Market Rental Rates
Properties owned by the Company will compete with other housing alternatives to attract residents, including other mobile home parks, apartments, condominiums and single-family homes that are available for rent, as well as other mobile homes, new and existing condominiums, and single-family homes for sale. Competitive residential housing in a particular area could adversely affect the Company's ability to sell its mobile homes, rent its mobile home lots as necessary to maintain occupancy, and/or to increase or maintain lot rental rates. Improvements to Properties planned by the Manager will be designed to make them more attractive to new and existing occupants, in hopes of creating a competitive advantage as compared to other housing alternatives in the marketplace.

Vacancies and Tenant Defaults May Reduce Revenues
The Company depends on lot rental income and mobile home sales to pay both the operating expenses for its Properties and the Company itself. Vacant lots and/or purchase payment defaults by tenants and/or buyers of mobile homes sold by the Company could reduce the amount of Net Proceeds Available for Distribution that might otherwise be available for payment of its expenses and mortgage payments and/or Distribution to the Members, if the Properties were fully occupied and/or all occupants were making timely lot rent or purchase payments. Significant Company expenditures such as debt service payments, real estate taxes, insurance and maintenance costs are generally not reduced when circumstances cause a reduction in income from Properties owned by the Company.

A vacancy or default of a tenant on its lot rent or mobile home purchase payments will cause the Company to lose the revenue from that unit and if enough effective vacancies occur, it could cause the Company to have to find an alternative source of revenue to meet its mortgage payments and other operating expenses for a particular Property. In the event of a tenant default, the Company may experience delays in enforcing its rights as landlord and may incur substantial costs in evicting the tenant, removing its mobile home, and re-renting the affected lot. In the case of a default on a seller-financed mobile home, the Company could experience delays in enforcing its rights against a defaulting purchaser.

The Manager will attempt to mitigate its effective vacancies by employing a marketing campaign and/or lease incentive programs. It will attempt to minimize tenant defaults by screening new tenants and potential mobile home buyers. The methods for screening new tenants and potential mobile home buyers will be determined on a case-by-case basis. The Manager will attempt to minimize such Losses by employing the Property Manager and/or legal counsel to promptly remove each defaulting tenant/buyer within the purview of the applicable law.

The Company Will Rely on Local Property Managers and Contractors
The Company has no independent ability and/or resources to manage and/or renovate each Property it acquires. The Company will rely upon the Property Manager and/or contractors to manage each Property and make renovations. The Manager has carefully reviewed the past experience, qualifications, and references of the Property Manager and will carefully review the past experience, qualifications, and references of any contractors and will ensure that any contracts with such persons have appropriate termination clauses in the event of default thereof.

Risk Associated with Construction or Development of Associated Property
The Company anticipates acquiring and renovating mobile home parks, individual mobile homes, and various amenities of the Properties. Additionally, some mobile home Properties may have additional property or buildings which the Manager may need to manage, such as vacant land that can be developed as additional mobile home spaces, mini-storage, warehouses, etc. These activities may expose the Company to the following risks:
- The Company may be unable to obtain, or experience delays in obtaining necessary zoning, occupancy, or other required governmental or third party permits and authorizations, which could result in increased costs or the delay or abandonment of opportunities.
- The Company may incur costs that exceed original construction estimates due to increased material, labor and/or other costs.
- Occupancy rates and rents of the Properties may fail to meet the Manager's expectations for a number of reasons, including changes in the market and economic conditions beyond the Manager's control and the development by competitors of competing communities.
- The Company may be unable to complete the construction and the leasing of its Properties on the Company’s projected schedule, resulting in increased construction and/or financing costs and a potential decrease in anticipated revenues.
- The Company may incur liabilities to third parties during the development process, for example, in connection with managing existing improvements on its sites or in connection with providing services to third parties, such as the construction of shared infrastructure or other improvements.
- The Company may incur liability if its Properties are not constructed and operated in compliance with accessibility provisions of the Americans with Disabilities Act, the Fair Housing Act or other federal, state or local requirements. Noncompliance could result in imposition of fines, an award of damages to private litigants, and a requirement that the Company undertake structural modifications to remedy the noncompliance.

Risks Related to Properties Acquired by the Company

Due Diligence May Not Uncover All Material Facts
It is possible that the Manager may not discover certain material facts about the Properties the Company acquires, because information presented by the sellers may be prepared in an incomplete or misleading fashion, and material facts related to the Properties may not be discovered and/or occur until after the acquisition thereof.
The Manager has extensive prior experience in acquiring similar properties, however, and will use its experience in such matters during the course of its due diligence. In addition, the Manager will employ an appropriately licensed (where applicable) or other local professional property managers, inspectors, appraisers, surveyors, contractors, and/or other consultants as the Manager may, in its sole discretion, deem necessary to assist in its due diligence efforts to obtain and verify material facts regarding the Properties, prior to acquisition.

The Company Anticipates Using Leverage
The Company anticipates the use of institutional financing in the acquisition and possible refinancing of its Properties. The Company's use of leverage potentially increases the risk of an investment in the Company, as it is possible that the rental income from the Properties in any month may be inadequate to allow the Company to make the monthly debt service required on each of the loans against its Properties. If the Company is unable to make the required financing payments on a Property, a lender may foreclose upon such Property and some or all of the Company's investment in such Property may be lost.

The Manager anticipates that proposed loans for individual Properties will have an average loan to value ratio of between approximately sixty percent (60%) and seventy percent (70%) of the gross fair market value of each Property, with a maximum loan to value ratio of seventy-five percent (75%) of the Company’s Property Portfolio, and mortgages will typically have balloon payments due five (5) to ten (10) years following the closing on each Property. The interest rate on the loans will typically be fixed, up to the prevailing market interest rates at the time such loan is secured by the Manager. The Company may refinance some or all of its Properties prior to expiration of the initial loan terms in lieu of resale. The monthly payments will generally be based on an amortization schedule ranging from fifteen (15) to thirty (30) years.

Because of balloon payments, to avoid a default, the Company must either: repay the principal, refinance the mortgage on or before the maturity date of the loan, or sell the Property upon which the loan was secured. No assurance can be given that the Company will be able to repay the principal and/or refinance a mortgage on one or more of its Properties at or prior to their maturity date thereof. No assurance can be made that the Company will be able to refinance any loan at an interest rate that is comparable to the current interest rate or on favorable terms in the future.

Mortgages typically contain customary covenants and the Company's continued ability to borrow against a Property is subject to compliance with these financial and other covenants. In addition, failure to comply with such covenants could cause a default under the applicable debt agreement, which would then require such debt to be repaid with capital from other sources.

There is also the risk that, at the time of sale of a Property, the sales proceeds will be less than the amount needed to pay off the total remaining balance of any financing upon such Property at the time of sale, and as a result, some or all of the Company's investment in such Property could be lost therefrom. There is also a risk that if upon the expiration of the loan term, a Property cannot be sold or refinanced such that the proceeds generated thereby will ensure repayment of the remaining balance of such loan, and the Company may be forced to surrender such Property to the lender upon a foreclosure thereof, resulting in the total loss of all of the capital invested in such Property.

Financial Projections May Be Wrong
The Manager has not provided financial projections regarding operations of the Company. Prospective Investors should review Section 10 of this Memorandum describing the investment objectives and policies of the Company as well as the Company's Investment Summary (Exhibit 4). It is possible that actual results from the operation of the Company may be different than the returns anticipated by the Manager, as such are detailed herein, and/or that these returns may not be realized in the timeframe projected by the Manager, if at all. The Manager will periodically provide the Members with information about the Properties it acquires on behalf of the Company.

The Company's example financial projections in its Investment Summary and the Manager's Track Record (Exhibits 4 and 5, respectively) have not been examined by an independent auditor or accounting firm. There can be no assurance that the Company's target returns based on its own internal financial projections will be realized. The Company's financial projections in its Investment Summary may contain forward-looking statements that involve risks and uncertainties, such as statements of the Company's plans, objectives, expectations, and intentions. The cautionary statements made in the Property Information Package should be read as being applicable to all related forward-looking statements wherever they appear. Furthermore, any Company financial projections have been prepared based upon the assumption that the Company will attain successful operations and obtain mortgage financing for Properties upon acceptable terms. Accordingly, the Company's actual results could materially differ from those anticipated by the Manager and detailed in the Investment Summary.

The Property May Not Yield Anticipated Results
One or more Properties may fail to perform as the Manager anticipated when analyzing each investment thereto. Further, actual renovation and/or redevelopment costs of a Property may exceed the Manager's estimates of the cost of renovating and/or redeveloping a Property. The financial projections for a specific Property contemplated for purchase will be based on the Company's ability to secure a sufficient number of tenants or mobile home sales at the local estimated market rate, which is based on current lot rental and/or resale rates for mobile homes in the vicinity of such Property as well as a review of market rents/sale prices in comparable properties, to the extent comparable properties and resale mobile homes exist in the marketplace. There can be no assurances that the Company will be able to find a sufficient number of suitable occupants or that the Company will be able to charge and collect its estimated market rates for lot rental or resale of mobile homes.

Lack of Reserves or Working Capital
A portion of the proceeds of this Offering will, in the Manager’s sole discretion, necessarily be set aside for Working Capital and Reserves, and therefore, will not be available for investment. It is possible that expenses of acquiring, holding, and reselling the Properties may exceed the Reserves or Working Capital the Manager has set aside for the Company, such that additional capital may be needed to operate the Company's business. In the event that additional capital is required as determined by the Manager in its sole discretion, an advance from the Manager and/or one or more of the Members, and/or obtaining additional outside financing may be needed to raise such capital.

Title Insurance May Not Cover All Title Defects
The Manager anticipates acquiring title insurance on each Property, but it is possible that title defects may arise in the future that are excluded from coverage and/or for which the title company may deny coverage, or that title insurance may not be available for certain Properties; in which case, the Company may have to defend or otherwise resolve such defects on its own, the cost of which may impact the profitability of such Property and/or the Company.

Hazard Insurance May Not Cover All Hazards
To the extent possible, the Company will attempt to acquire insurance protecting the Company against fire, weather, or environmental hazards, theft and vandalism for each of its Properties. However, based upon the locale of a Property, such insurance may not be available in such areas, nor are all hazards insurable as some may be deemed acts of God or be subject to other policy exclusions. Furthermore, an insurance company may deny coverage for certain claims requiring the Company to initiate a lawsuit in order to receive coverage for such claims, resulting in further Losses to the Company. Additionally, a Property may be found to contain mold, which may not be covered by insurance and has been linked to health issues. Should an uninsured loss occur, the Company could lose its capital investment and/or anticipated Profits and cash flow from such Property, which could in turn cause the Manager, in its sole discretion, to reduce or eliminate the amount of distributions the Company makes to Members.

Inclement Weather Could Increase Maintenance and Repair Costs
Properties owned by the Company may be exposed to risks of inclement weather, including, but not limited to wind-related events such as severe thunderstorms, windstorms, tornadoes and/or hurricanes. Further, unpredictable winter conditions may result in indeterminate costs for the removal of snow and ice, as well weather delays in the renovation and redevelopment. In addition, inclement weather could increase the need for maintenance and repair of the Properties. As some of these hazards may be uninsurable, and/or the routine maintenance costs or damages caused by such hazards may be less than the insurance deductibles, the Company may need to expend its own funds for such repairs or mitigation.

Payments to Service Providers Will Reduce Cash Available for Distributions
Payments to the Property Manager (or Affiliates of the Manager) in connection with the management and leasing of the Properties will be an expense of the Company, and will reduce the amount of cash available for distributions to Members.

Risk Factors Involving Income Taxes

The Company May Be Characterized as a Publicly Traded Partnership
Based upon representations by the Manager that the Units will be issued in a transaction not registered under the Securities Act, the representation of the Manager and FundAmerica that the interests in the Company will not be traded on an established securities market and the obligations of the Manager to take all actions reasonably necessary to prevent the Interests in the Company from being traded in a secondary market or the substantial equivalent thereof within the meaning of Section 7704 of the Code, it is more likely than not that the Company will not be treated as a “publicly traded partnership” for federal income tax purposes. Classification of the Company as a “publicly traded partnership” could result in (i) taxation of the Company as a corporation or (ii) application of the passive activity loss rules in a manner that could adversely affect the Members.

Tax Liability May Exceed Distributions
As a result of decisions of the Manager in operating the Company, which may require the suspension of distributions due to a need to maintain a higher level of cash reserves, as determined in the sole discretion of the Manager, there is a risk that, in any tax year, the tax liability owed by a Member may exceed the distributions received by such Member in that year. As a result, some or all of the payment of taxes may be an out of pocket expense of the Member.

There is a risk that upon the disposition of a Property, the tax liability of a Member may exceed the distributable cash available therefrom. In the event of an involuntary disposition of a Property, there is the possibility of a Member having a larger tax liability than the amount of cash available for distributions at the time of such disposition, or at any time in the future. However, the Manager will use its best efforts to limit such exposure to the Members.

Risk that Federal or State Income Tax Laws Will Change
There is a risk that Federal or State income tax laws may change affecting the projected returns of an investment in the Company. There is a possibility that in the future Congress may make substantial changes in the Federal tax laws that will apply to the Company and its Members.

Risk of Including Foreign Investors Pursuant to Regulation S of the SEC
The Company may accept Subscriptions from Non-U.S. Persons, pursuant to Regulation S of the SEC, in which case there is a risk that: the proper tax withholding amounts will not be withheld or paid by the Non-U.S. Person as required by the Foreign Investor in Real Property Tax Act of 1980 (FIRPTA) and that the Company could remain liable for a Non-U.S. Person's individual tax liabilities to the IRS. There is a further risk that a Non-U.S. Person Investor could be named on the list of Specially Designated Nationals, Blocked Persons, or Sanctioned Countries or Individuals, which, if undiscovered, could result in an enforcement action against the Company by the U.S. Department of the Treasury and/or other Federal agencies. In order to mitigate these possibilities, the Manager will conduct due diligence on each Non-U.S. Person it considers Accepting as a Member of the Company, and will attempt to determine whether there are any security restrictions on such Non-U.S. Person at the time of its subscription. Further, if the Manager Accepts Non-U.S. Persons as a Member to the Company, the Manager will employ a C.P.A. versed in international investments on which it will rely upon to calculate and remit the appropriate withholding amounts therefrom. At the time of publication of this Memorandum, the Manager was not contemplating including any specific Non-U.S. Persons as Investors in the Offering.

Phantom Income Risk
The voluntary or involuntary sale or transfer of a Company Investment owned by the Company or any entity through which it invests may, under certain circumstances, result in substantial tax liability to a Member with little or no cash available for distribution to such Member to cover such tax liability. Because a discharge of liability, even without any cash distribution, can produce taxable income, a Member’s taxable income and tax liability may exceed the cash, if any, received by such investor. To the extent of such excess, the payment taxes would require an out-of pocket payment by the Member.

The foregoing list of risk factors does not purport to be a complete enumeration or explanation of the risks involved in an investment in the Company. Prospective Investors should read this entire Memorandum and consult with their own advisors before deciding to invest in the Company. In addition, as the investment program of the Company develops and changes over time, an investment in the Company may be subject to additional and different risk factors. No assurance can be made that profits will be achieved or that substantial losses will not be incurred.