6-30-03

    This is DenSco's two-year anniversary! It doesn't seem that it's been that long! It's gone quickly and I'm enjoying the business and continue to learn every day. I thank you for your support and trust, and I will continue to grow the business and meet your financial investment goals.

   Q2 of 2003 has been extremely busy. The quick resolution in Iraq has removed a black cloud over the economy and mood of the country. The stock market is showing signs of life, interest rates are the lowest they've been since anyone kept track and the economy is undoubtedly going to recover in the 2nd half of the year. We funded 30 new loans in Q2, and have had 25 close. There are 13 loans that are currently in escrow.

   We had an additional 150k of investor's money added during the quarter. We have $3.3 million in the portfolio; there are currently 40 loans that have a value of $5.3 million. Our average loan life has fallen to 109 days, as we've had a lot of loans turn over very quickly in the last quarter. I would expect that it would rise back up to 115 days or so by the end of the year.

   The new memorandum is complete. I hope you have had a chance to read through it. I spent more time than I care to remember with the lawyers going page by page through it. Despite all the "legal speak", it does cover in detail the last two years. I am going to spend a considerable amount of time trying to raise more money with this in hand. I would hope that if you have any friends that might be interested, you share their name with me.

   In past newsletters and in the memorandum, I have referred to Rick Rickert and his company Maricopa Investors Alliance. He has been a key referral for a large percentage of our loans. His business has grown, and he needed some help. Ranasha, my wife, is now his office manager. She's been working there now three months. To help her, I have a good friend's daughter, Bri, working there now too. It's better to keep it in the family!

   It's been a great two years. DenSco has worked out just as I had planned. I'm hoping you are as satisfied with your investment as I am with the company. I will continue to strive to deliver on the expectations that I've set for myself and to continue to meet your expectations as investors.

   Denny J. Chittick