DATE: September 25, 2006

TO: Pacific Terraces Homeowners

FROM: Pacific Terraces Board of Directors

SUBJECT: Election of Directors at Forthcoming Annual Meeting

Our regular Annual Meeting of Pacific Terraces Homeowners will be held on Sunday, October 29th. The Meeting Notice, Proxy, Agenda and associated materials will be mailed to each of you at the end of next week.

The terms of four Directors expire this year (specifically, Jerry Leshgold, Terry Murphy, Stan Muir and David Rosencrantz); accordingly one agenda item will be the election of individuals to fill these positions.

As many of you may recall volunteering for Board membership was a subject of some discussion at last year’s annual meeting. We wish to encourage each of you to consider serving on the Board. Should you have an interest in running for election we ask that you contact Paul Tice at Gearhart by the Sea by Wednesday, October 4^th and so indicate; this will allow us to include your name in the mailed materials. Paul may be reached as follows (his preference being by e-mail):

E-Mail: paul@gearhartresort.com

Phone: 800-547-0115, or 503-738-8331

Fax: 503-738-0881

Mail: Gearhart By The Sea
P.O. Box 2700
1157 N Marion
Gearhart, OR 97138

Current Directors may stand for re-election, and of course, nominations may also come from the floor during next month’s meeting.

Thanks for your consideration; we look forward to hearing from you.