Kontiki Board Meeting Minutes

May 12, 2006

Board Members Attending: David Schultz, Richy Ethridge, Karra Crowley, Scott Schomburg, Pack Killingsworth not present.

Others Attending: Chris Crowley (Property Manager), Rob Mabe, Larry Biggers

Meeting started: 9:00am

1. The attending board members along with Rob Mabe, Chris Crowley and Larry Biggers walked the Phase I pier to discuss the breakwater and pier condition.

   1. It was noted that the shore guard panels have lag bolts in only one side of each instead of two.

   2. It was recognized that the shore guards near the end appear to be too short and have more movement than should be expected.

   3. The railing on the third fishing deck that ties to the breakwater needs to be reinforced.

2. Review of Meeting Minutes – Minutes accepted unanimously with discussion on the following items:

   1. Lighting timer on the pier was mentioned. Better solutions will be investigated.

   2. Deadman supports on the bulk head – Action item: Chris to get Kinsel to come out and help us come up with a solution and proposal to repair the bulk head. Also have him help us find a solution for the erosion of sand along the inside of the bulk head.

3. Property Manager’s Report –

February - April 2006

Removed, replaced, primed and painted window fascia boards for the following units: 103, 106, 108, 201, 202, 207, 210, 301, 302, 306, 601, 603, 608

Termites were found in every window fascia that was repaired. That will be addressed later in the meeting.

Repaired A/C stands for the following units:

104-105, 606, 608, 704 (Used materials on site)

Removed and replaced complete deck & railing for upper decks to units 209 & 210 (Stucco repairs to be completed by outside contractor)

Removed and replaced complete lower deck, stairs & railing for lower deck to unit 210 (Stucco repairs to be completed by outside contractor)

Removed and replaced both stairways and all 4 front landings to 400 building

Repaired Lighting on 400 Building:

Repaired damage to lift station pressure line (Damage was accidentally caused by riding lawn motor)

Repairs lift station Rob repaired for $310.00 (Bid from Aransas Plumbing $550.00)

Install clean out and line repairs at 700 Building – Rob to recap the clean out in the lawn in front of the 700 Bldg.

Clean out lift station

Built & installed 3 trash enclosures

Installed 6x6x24’ tall light in boat area

Replaced 8 bulbs on Pier

Replaced light on cabana

Disposed of old rusted picnic table previously located on the side of the 300 building

Installed hose, hose bib, hanger and nozzle at end of the 300 building

Replaced hose bib behind 307

Removed and replaced 2x6x12 on lower deck of 102 after guest’s foot went through deck

Removed and replaced 2x6x12 on lower deck of 301 after guest stepped through deck

Removed and replaced step on stairway to 711 / 712 after old step broke when an owner/guest stepped on it.

Installed 4’ x 4’ Security Warning Sign including the language “all unauthorized vehicles will be towed at owners expense”

Replaced boards on upper deck for unit 301.

Established a commercial account for the sole use of Kontiki Phase I with Bracht’s Lumber

Disconnected phone line at Maintenance Shed

Repaired sprinklers between 100 & 200 buildings, 200 & 300 buildings, and at end of the 300 building.

Leveled sand behind 100, 200 and 300 buildings

New sand to be installed

On going maintenance for Phase I

Pick up garbage and debris in parking lot, empty garbage cans, water areas not covered by sprinklers. (average 5 to 6 hours per week)

Feb 2006: $280.00

March 2006 $325.00

April 2006 $325.00

4. Jerry’s Contract – Richy will contact Jerry and get a copy of his contract. The objective is to review his list of responsibilities so that Chris Crowley knows where Jerry’s scope stops and starts.

5. Termites – Termites were found in the exterior window trim of all the buildings where the trim was repaired. Our intention is to drop the agreement with Big M Pest Control due to lack of performance. Chris Crowley will solicit Bug Free and Aggie Pest Control for bids for our pest control contract.

6. Sprinklers on back of 400 bldg need to have some heads moved from a long circuit to a short circuit. Scott and Rob to walk it after the meeting.

7. HEB/Kontiki Beach Access – HEB is refusing to allow us to place our language into their proposed contract. Chris and Karra will try to reach the former President of HEB. He apparently lives on Key Allegro Island.

8. Coinsurance – tabled until next meeting. Have Scott Teachout discuss when he comes to next meeting.

9. Increase Property Insurance – Richy to call HRH to implement our new insurance rate of $100.00 per square foot.

10. Insurance Renewal – Chris and Karra will get insurance bids from Dan Markson and GSM. Bid will cover Property, Windstorm and Flood.

11. Derrick Construction – Richy had a meeting with Moose last week.

    1. Moose agreed to install any missing all-thread bolts in the breakwater.

    2. Moose agreed to finish dredging the channel when he is able to buy a barge locally.

    3. The main issue with the dredging is where the old opening was located.

    4. Chris and Karra will review the contract to see if there is a statute of limitations and when it starts.

12. Electrical – Scott brought in information for residential rates. All owners are responsible for contracting for their own electrical rate. It is not possible to aggregate the private meters for each unit. The commercial (common area) meters are on one contract through Startex Power. The contract is for two years starting November ’05. The penalty for cancellation is three months highest bills as a buy out of the contract. Although our rate is at 12.74 cents/Kwh, it is not financially prudent to buy out at this time. The board will monitor the rates to see if at some point in the future it makes sense to take the buy out.

13. Balcony Issues – Three members of the board say that it was not in the best interest of the Home Owners Association for the issue of “dividing deck repair costs” to be brought up at the Board Meeting on 5-11-06.

14. Security –

    1. By a vote of 4 to 0 Chris was voted to manage the security contract.

    2. Board discussed adjusting Paul’s contract to less midweek time and heavier weekend presence. This will be adjusted as deemed necessary.

    3. Adjust the large light that shines over the entrance to the Phase II pier so that it shines less into the bay and more toward the 100 and 700 buildings.

    4. Karra to pick out several exterior side wall fixtures and beta test an area to check their aesthetics and exterior lighting output.

    5. Richy has concern about parking around the 300 building area on heavy weekend times. Chris will adjust the security schedule accordingly.

15. “No Wake Sign” – Chris will have a large (approx. 4’x 4’) “No Wake Sign” installed on the end of the pier and on the end of the south breaker. Hopefully this will help slow boaters sooner in the channel.

16. Railing height for decks and balconies – The 1^st floor deck railing height will be left at their current height. The 2^nd floor balcony railing height will be recommended by Karra by sitting in a chair on one of their 2^nd floor balconies.

17. David Schultz to get a new tray for the BBQ pit at the pool.

18. Chris to add a 3rd dumpster and increase the frequency of emptying to 3 times per week.

19. Vote to install new titles of board members –

    1. Richy for President – 3 to 1

    2. Karra for Vice President – 4 to 0

20. Next Meeting – Saturday, August 19^th, 9:00am

21. Meeting adjourned – 12:45pm