Oasis Beach Villas Resort & Spa Execution Strategy The OBV Execution Strategy describes how OBV Management executes the OBV Business Plan and the assumptions relied upon in the OBV Pro Forma Financial Statements. Overview The description of the Execution Strategy begins with the close of escrow (COE) on the Master Leasehold transaction between Vantage Corporation, or assignee (OBV Corp.), and the Srithongkul family (Landowner / Master Lessor). COE shall occur upon full execution of all transaction documents and full payment to the Landowner for the 30-year Leasehold rights to the completed 50-Suite beachfront resort. Upon COE the Master Lessor and development team shall design and construct the fully- furnished and staffed 5-star resort. Establishment of Legal Entities Concurrent with completing this subscription full capitalization, Vantage Corporation will assign all interests under the Master Lease Agreement to OBV, a newly formed U.S. company for the purposes of facilitating ownership of this development. OBV is owned by the Investors proportionally to their share or unit interests in OBV. OBV shall also assume the Hotel Management Agreement with World Resort for the management of resort operations. World Resort will assign all interests under the Hotel Management Agreement to OBV Thailand, a newly formed company for the purposes of fulfilling the Hotel Management Agreement with OBV. OBV Thailand is owned and managed by the Srithongkul family. OBV will hold Master Leasehold rights to the OBV resort and will assume the Vantage Corporation contracts with a U.S. Property Manager (Vantage Investment) and a local Hotel Operator (World Resort) for resort operations and supervision. Capitalization Vantage has set up a bonded escrow facility to establish individual trust accounts for receipt of each investor’s funds. U.S.-based Investor funds may be deposited to a trust account with Orange Community Escrow, Inc., a bonded California Escrow Corporation. Non U.S.-based Investor funds may be deposited to the trust account of the Law Offices of Tilleke & Gibbons in Bangkok, Thailand. Escrow will hold each individual Investor’s funds in an interest-bearing trust account specifically for each individual Investor. Funds are to be credited to OBV, the Master Lessee of OBV Resort in Koh Samui, Thailand, towards the one-time payment to the Landowner for the 30-year Master Leasehold on the fully-operational OBV Resort Villas and the land. When sufficient funds are on deposit between the two escrow facilities, OBV will instruct escrow to make a one-time disbursement to the Landowner in exchange for the Master Leasehold rights. The Landowner, the Srithongkul family, will then immediately request the Government Land Office to subdivide the land into individual parcels for each Villa and record the Master Leasehold interests of OBV against the Land Deeds. Upon completion of the new Deeds and Leaseholds by the Government Land Office the Landowner will deliver to OBV the documents evidencing the Leasehold. Staffing Responsibilities for Staffing and Operations will be managed by the Hotel Operator (OBV Thailand). Khun Supinya Srithongkul shall be appointed Managing Director of OBV Thailand to perform responsibilities under the Hotel Management Agreement with OBV. Khun Supinya is currently the Resort Manager for World Resort in Koh Samui, just a few kilometers down the beach from the new OBV resort. For the last 8 years she has also been the Treasurer of the Tourism Association of Koh Samui (TAKS). Upon close of the OBV escrow(s) the Hotel Operator will begin intensive work on staffing the OBV resort for the grand opening 12 months thereafter. All staff shall be employed by OBV Thailand. The MD will employ 3 Senior-level Directors, 4 Resort Managers, 6 Line Managers, and 80 Resort Staff. OBV will employ Resort Staff at approximately a 3:1 staff-to-guest ratio, and Resort Management at a 6:1 staff-to-manager ratio. The total number of resort employees for OBV Thailand is 93 personnel. OBV Thailand has created compensation packages that are superior to the marketplace to retain experienced labor, including attractive salary plus generous housing allowances. The MD will leverage extensive local industry contacts to recruit top talent in this booming resort community. OBV Thailand has already made promising recruiting contacts with experienced management personnel from competing operators in Koh Samui. In month #1, the Managing Director (MD) will conduct formal interviews with candidates for the 3 Senior-level Director positions: Director of Resort Operations (DRO), Director of Marketing (DM), and Director of Information Systems (DIS). Qualified candidates will be presented to OBV management for selection approval. Upon confirmation by OBV, OBV Thailand will execute employment contracts with the Senior-level Directors and outline their responsibilities. The DRO and DM will begin full-time employment immediately upon executing the employment agreements and will commence with operations and marketing activities according to budget and schedule. The DIS will begin full-time employment in month #6 and will commence with the information systems component of the operations plan. In month #6 the MD will form a recruiting committee with the DRO, MD, and DIS for staffing of Resort Manager and Line Manager positions. Formal interviews with Manager candidates will be completed and recommendations made to the MD by the end of month #7. Resort Managers will begin full-time employment in month #8 upon executing employment agreements. Line Managers will begin full-time employment in month #9 upon executing employment agreements. The MD and DRO will form management teams with the Senior-level Directors, Resort Managers and Line Managers for successful staffing and operations of OBV. Staffing of all positions shall be completed by month #11. Training The Director of Resort Operations (DRO) will appoint 4 Resort Managers for Accounting, Guest Services, Personnel & Training, and Housekeeping. The DRO will also appoint 6 Line Managers for Front Desk Manager, Concierge Manager, Food & Beverage Manager, Health & Fitness Manager, Maintenance Manager, and Training Manager. In month #9 the Resort Manager and Line Manager responsible for training will work with the management teams formed by the MD & DRO to produce Training Programs for all personnel. The Training Managers (TM) shall be responsible to publish, schedule and conduct training specific to each teams needs. Additional training from OBV’s outside service providers shall be part of the Training Programs. All personnel shall complete phase one of the Training Programs by the end of month #12 and the Commencement Date of the Master Lease to OBV. Information Systems The Director of Information Systems (DIS) will work under the supervision of the Managing Director (MD) and Property Manager (PM) to recommend and implement hotel-industry management information systems specific to OBV hotel operations. OBV is presently evaluating information systems solutions from Amadeus, a hotel solutions provider, and other vendors. The DIS will be responsible for data collection and compilation, operating hardware and software throughout OBV, integrating OBV systems with external client systems, coordinating training of OBV personnel, systems troubleshooting, and enterprise development. Solutions-specific training will be provided by the provider. The DIS will survey at least 5 different solutions providers in the first month of employment and will prepare and submit RFP’s to each provider for bid. DIS will review bids and recommend bid selection to the Managing Director within 60 days of employment. Marketing OBV Thailand, the Hotel Operator, will contribute $1,500,000 USD to the initial marketing of OBV during the 12-month period between close-of-escrow and the grand opening. The Director of Marketing (DM) will work under the supervision of the Managing Director (MD) to build and implement the OBV Marketing Plan. Internet The DM will work with the DIS and MD to define solutions providers to collaborate on an internet strategy for OBV, which includes a full-function website, online advertising, email campaigns, media capture with auto-responders and drip-marketing campaign. The DM will maintain online advertisements through premium search-engine ads. OBV has budgeted over $250,000 per year for Google advertising to achieve 1st or 2nd ranking (average bid of $2.80 per click-through) directed at 90,000 unique visitors per year from our target markets seeking luxury rentals in Koh Samui. The DM will market OBV through approximately 25 vacation home sites with an annual budget of $17,500 USD. The DM will identify and select the most popular sites in regions producing the most tourism to Koh Samui: Britain, Germany, Scandinavia, Australia, U.S.A., Japan and China. OBV has also budgeted $50,000 per year for website development services, including search engine optimization, auto-responders, drip-marketing, and data-capture & integration with OBV databases and MIS systems. The DM will send 100,000 outgoing emails per year to various target groups at an estimated bulk cost of $0.05 per email address. Additionally, the DM will send monthly emails to our own database of prospective guests, previous guests and travel agents as part of the drip-marketing campaign. Tradeshows The DM and MD will select, schedule and attend travel-industry tradeshows to promote OBV. OBV has budgeted $25,000 USD per tradeshow with 9 shows scheduled per year. The DM is required to attend every scheduled tradeshow. Strategic Partnership Referrals The DM and MD will also define and negotiate strategic partnerships with co-marketers and referral sources. OBV has budgeted $250,000 USD annually to contribute to as many as 10 Strategic Partnership programs. Special Events - Guest Marketing The DM and MD will define a Special Event strategy and arrange participation at special events to promote OBV with an additional budget of $10,000 per event for up to 10 events per year. Event marketing is targeted to Guests by positioning OBV to gain relevant exposure in our target markets of Western Europe, Scandinavia and Asia. Travel Agents The DM will also define and maintain multi-faceted and ongoing Travel Agent marketing, with a budget of $10,000 USD per month to be used towards positioning and integrating with high-volume Travel Agents in Scandinavia, Western Europe, Hong Kong, Dubai, China, India, Singapore, and the U.S. The DM will also negotiate Travel Agent promotions with a budget of $5,000 per promotion with 10 such promotions per year. Travel agent promotions include promotional OBV offers through the travel agent’s consumer marketing, and promotional stays at the OBV resort. Print Advertising The DM will manage the OBV print advertising campaign targeting Guests and Travel Agents with an annual budget of $300,000 USD and a target of 12 luxury travel publications in our target markets. Drip-Marketing The DM will send 5000 Direct Mail pieces per month as part of the OBV drip-marketing campaign, at a cost of $1.00 each plus $0.80 postage. The pieces will be targeted to prospective guests and travel agents in the OBV marketing database. Marketing Communications & Budgeting The DM will be responsible for the design of marketing literature and public relations releases. All marketing pieces will be reviewed and approved by the MD for consistency and budget limitations. Project Completion The Landowner and the development team of Horsilp Architects & Case Construction are responsible for the design, development and delivery of the completed resort to OBV. The design & development will be supervised by the Executive Committee of the Hotel Operator. When sufficient funds are fully subscribed to the Master Lessee, OBV, disbursement will be made to the Landowner in accordance with the Commercial Lease Agreement. Upon receipt of payment the Landowner will instruct the Government Land Office (LO) in Koh Samui to subdivide the land into individual lots for each of the 10 proposed villas and to record the OBV Leasehold interests against the ownership documents (Chinote Title Deed). The LO will schedule a government team of surveyors to survey the property and create the final Chinotes. The process will take approximately 60 to 90 days and will be at the expense of the Landowner. Upon issuance of the new Chinotes, the Landowner will deliver documents evidencing OBV’s leasehold interest to OBV. Upon Close of Escrow the development team (DT) will conduct a detailed site visit to prepare a Topographic Map and Geological Study. The DT will further develop the current Site Analysis and Perspectives and will modify the Master Plan as necessary. In month #1 the DT will solicit bids for renewable technology systems such as wind & solar generators and water purification systems, and will incorporate these into the Environmental Engineering Plan. The DT will also prepare detailed Engineering and Building Plans for grading, roadways, water & sewer systems, and underground utilities. In month #2 the DT will prepare detailed Engineering and Building Plans for villas, buildings, pools, and landscaping. The Builder, K.A.S.E. Co., Ltd., will commence work on the Grading Plan such as excavation, fill, compaction, and shoring. In month #3 the Builder will complete the Grading Plan and all Site work including the building pads, and trenching for underground utilities along the roadways and to the buildings. The Builder will begin make all roadways and install complete installations of sewer, water and electrical systems. In month #3 the Builder will also begin construction of the common pool area. In month #4 the Builder will complete the common pool & cabanas, and install the wind and solar generation systems, water tank & purification systems, electrical panels and complete the electrical infrastructure. The intercom/communications systems will also be installed before final grading over the utility trenches. Month #4 will also commence the building of a perimeter wall and completion of the Front Security Gates. Construction will also commence for the OBV Clubhouse, 2 spa buildings, and the 10 Villas. The spas and perimeter wall will be completed in approximately 2 months and the OBV Clubhouse and Villas will be completed in 4 months. In month #5, 6 & 7 the Builder will build-out the OBV Clubhouse, 2 spas and 10 Villas. In month #7 the Builder will commence construction of the OBV Clubhouse lobby, spa, restaurant and conference rooms. In month #8, 9 & 10 the interior appointments will be completed on the OBV Clubhouse, 3 spas, front lobby & offices, restaurant & wine cellar, conference rooms and service areas. Complete landscaping will be installed during month #9 & 10. All Villa construction & design will be completed by month #11. By the end of month #11 all resort amenities, equipment and staff will be on site and functional. Month #12 will be a period for the management and staff to perform any necessary adjustments prior to Commencement Date of the Master Lease. At the end of month #12 the Landowner will deliver possession of the Villas to OBV Corp. and the Hotel Operator. Operations Beginning with the marketing efforts in month #1 OBV will accept reservations for the Commencement Date 12 months after the Close of Escrow on the Master Lease. The Grand Opening of Oasis Beach Villas in Koh Samui will be planned to include special guests from our business contacts and local community leaders. Beginning with a Buddhist anointing, as is the local custom, OBV will welcome Thai and foreign leaders in investment, marketing, and social communities for a short series of special events at the OBV Clubhouse and promotional accommodations for 1 to 2 weeks at the resort. The 30 guest Suites will host over 100 VIP Guests and OBV Clubhouse Members during the 2- week Grand Opening. Cash Flows All revenues, including cash and drafts, shall be placed into the OBV Thailand Operating Account at Kasikorn Bank in Koh Samui, Thailand. The principals of OBV Thailand have over 20 years of banking relationships with Kasikorn Bank (previously Thai Farmers Bank). Once per month Kasikorn Bank will perform a cash-sweep to transfer funds from the OBV Thailand Operating Account into the OBV Trust Account held by the OBV Property Manager, Vantage Investment. The Operating Account will retain a minimum balance of sufficient funds for the following month’s operating budget. A separate Reserve Account shall be held and controlled by the Master Lessor (Landowner) for budgeted FF&E reserves. Once per quarter the OBV Property Manager shall supervise delivery of all Management and Financial Reports to OBV Corp. in the U.S.A. The OBV Property Manager shall also make international transfer of quarterly post-tax revenues from the OBV Trust Account to the OBV Corp. Capital Account at Kasikorn Bank in Bangkok, Thailand within 30 days after the end of the fiscal quarter. OBV Thailand shall operate within monthly and quarterly budgets prepared by the DO not less than 30 days before the start of the fiscal year. The existing operating budget shall prevail unless modified by mutual agreement by OBV Corp. and OBV Thailand. Budget amendments may have retroactive effect and shall be reconciled with the Operating and Reserve Accounts monthly or quarterly, as appropriate. Exit Strategy OBV has planned two “Exit Points” in the business model. OBV Investors have the option to remain invested in OBV or may convert their Certificates into shares as part of the Exit Transaction. Initial OBV Investors shall receive Series-A Membership Units at $100,000 USD each. One Series-A Membership Unit may be converted to 100,000 preferred shares of OBV Corp. at any “Exit Point”. 12-months after this funding OBV Corp. will pay 10% dividends in the form of Convertible Class-B Certificates with Par value of $1.00 USD each. The Convertible Class-B Certificates may also be converted to regular shares at any “Exit Point”. “Exit Point” number one will occur 12 – 18 months after commencement of resort operations. Based on similar projects, OBV has scheduled commencement of resort operations 12 months after fully subscribing the current Private Placement. Therefore, 24 – 30 months after funding OBV will provide OBV Investors the first optional “Exit Point”. The second optional “Exit Point” will occur 6 – 12 months after completion of the first. The first “Exit Point” will occur through a partial sale of interest in OBV Corp. to a publicly-traded company. OBV principals are currently negotiating in advance with buyers for the fully operational resort property. The buyers will likely raise funds through a public shell company and obtain new debt & equity. This proposed buyer shall be referred to as OBV Corp.#2. The second “Exit Point” will occur when OBV Corp.#2 concludes an agreement with a new flag-Hotel Operator to replace the initial OBV Hotel Operator, OBV Thailand (World Resort). The new flag-Hotel Operator will be required to inject significant equity capital to secure their new Hotel Management Agreement. The equity injection will be primarily used to buy back preferred and regular shares held by Investors in OBV Corp. OBV Investors shall have first-right-of-refusal to participate in additional OBV projects. OBV has planned several additional projects to capitalize on our position and resources in the marketplace and to develop economies of scale within our operations. Repatriation of Funds The OBV Property Manager, Vantage Investment, shall make a quarterly distribution of post-tax revenues from the OBV Trust Account to the OBV Corp. Capital Account held in Bangkok, Thailand, or other domicile advantageous to Investors. Prior to disbursement, sufficient monies shall be set-aside to pay tax liabilities in Thailand and a Tax Certificate shall be obtained confirming payment. Quarterly dividends shall be paid to Investors according to banking instructions held on-file by OBV Corp. The OBV Property Manager shall transfer funds by wire from the OBV Trust Account directly to OBV Corp. Capital Account. Within 21 days of receiving funds, OBV Corp. shall then distribute not less than 90% of net earnings as dividends from the OBV Corp. Capital Account to Investors holding OBV Series-A Membership Units. Investors participating in the OBV Dividend Reinvestment Program will have dividends retained in Thailand and applied towards reinvestment.
Pages to are hidden for
"Execution Strategy"Please download to view full document