Supplied by Scott Schomburg

Kontiki Board Meeting Minutes

*****These notes are an overview. More detailed notes will be forthcoming.*****

August 19, 2006

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

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

Meeting started: 9:05am

1. Meeting Called to order at 9:05am.

2. Minutes from the May 12, 2006 meeting were unanimously accepted.

3. Presentation from Scot Teachout with HRH Insurance.
1. At the last owners meeting it was passed by the owners to raise our replacement insurance from $90.00/sq ft to $100/sq ft. With the increased coverage we are receiving a 12% increase in premium but with a reduction of _ % due to a reduction in _ we have a net premium increase of _.
2. Personal contents coverage:

· All personal items such as clothes, dishes, furniture, wall hangings, rugs etc are not covered in any way by the HRH policy and each owner should cover these with a personal policy if they so choose.

· Appliances, cabinets, floorings, sheetrock, wall coverings and fixtures are covered by HRH Insurance up to the original installation grade plus a cost increase over time. If an owner has improved the quality of any of these items then that owner would receive coverage for the original installed quality of product plus cost increase over time. The difference between the original and the upgrade will be the responsibility of the owner.

3. The board voted unanimously to increase the “Increased Cost of Construction” amount from $600,000.00 to 10% of the policy amount which is approximately $7.4 million. This “Increased Cost of Construction” amount has been left at the same rate for a number of years as construction costs have rose. By making this change we have brought the number back in line with where we thought we needed to be to best protect our interests.
4. The board chose to leave the General Liability and Board Liability at the same rates of $6,000,000.

4. Property Manager’s Report –

Prepared by Chris Crowley

May- August 2006

Brought 30 truckloads of new sand for the beach behind the 100, 200 and 300 buildings. Complete beach has been raked, leveled and weeds removed.

Replaced 35’ of the pier, and additional 35’ needs to be replaced in the near future.

Cleaned old asphalt from holes, repaired and overlaid. Work completed by Claud Bryer at a cost of $1,800.00.

Repairs to roof completed by Berryman Roofing:

Unit 602-$1,569.63

Unit 705- $600.00

Unit 506- $800.00

Repairs to roof completed by Rob Mabe:

Unit 710- $150.00

Purchased and installed 2 additional 4x4 “No Wake” signs at the end of the channel. One more to be installed at harbor end of channel.

Obtained bids from Bug Free for Pest Control Service and Termite Contract.

Additional dumpster was installed and an extra pickup was scheduled for the summer. Request for removal of additional dumpster and discontinue of extra pickup has been made since summer “rush” is over.

Peeco has been out to repair problems in the control panel of the lift station 2 times. The lift station has been cleaned 2 times.

Repaired and resupported the cabana. Palm leaves were located and delivered to Kontiki. They will be installed next week.

Replaced 2 deck boards in the rear deck of unit 101.

Replaced 2 deck boards in upper deck of unit 108.

On going maintenance for phase I

Pick up garbage and debris in parking lot, empty garbage cans, water areas not covered by sprinkler. (average 8 to 10 hours per week) Time required will be reduced to 5 to 6 hours per week beginning September.

May 2006: $325.00

June 2006: $575.00

July 2006: $575.00

Aug 2006: $575.00

5. Swimming Pool – The board discussed the condition of the fence around the pool. Due to the deteriorated condition of the fence it has been deemed no longer reparable. The board voted unanimously to replace the fence. Safety is a very big concern at this point because the slats on the current fence no longer stay in place and a child could easily wonder into the pool area. It was also decided that since it will be completely replaced that now is the time to make any changes. The grass area at the shallow end of the pool will be expanded and another wooden deck will be built to help accommodate the very heavy use of the pool in the warmer months. An outdoor shower will be installed near the pump area so that swimmers can rinse before getting in the pool. This will help extend the life of the pool filtration equipment.

6. Fishing Pier – Recommended by Scott Schomburg that we improve the quality of our fishing pier. The following recommendations were agreed to by the board and will be implemented by the property manager.
1. Increase lighting on the end and at the fishing stations on the pier to increase the quality of the fishing experience and for safety reasons.
2. Put backs on the benches for comfort.
3. Put trach cans at the fishing stations on the pier for convenience and to help keep people’s trash out of the bay.

7. Review the Standard Operating Procedures. The standard operating procedures will be reviewed at the next owners meeting.

8. Condition of the grounds – The grounds need to be better maintained in terms of edging, trimming bushes and cleaning the beds. The property manager will get bids to take care of the grounds based on a basic scope of work. These will be reviewed at the next board meeting.

9. Deadman Supports – Rob met with Kinsel. He will install one and Rob will watch the installation process. The board will then either pay Kinsel to put in the rest or Rob will put them in.

10. Termite Treatment – Unanimous decision by the board to switch to BugFree Pest Control.

11. Derrick Construction – Moose Johnson is now stating that he will build a barge to use to complete the dredging of the channel. Richy will order another sounding from Bellaire Environmental. The property manager is to get the following prices from Kinsel: Finish dredging the channel, Install bolts into the shoregard where they are missing, Install large stainless bolts where several have come out. Kinsel also to give an opinion on the loose shoregard.

12. Lighting – The current light fixtures around the property are deteriorating and do not provide very good light. It was a unanimous vote to change the exterior lighting around the building. Several options were presented and an all plastic, exterior grade light fixture was chosen. Several will be order and installed to check the aesthetics and lighting before they are installed throughout the property.

13. Rail height was field verified and will remain at the current height throughout the property for all decks and balconies.

14. The Annual Owner’s Meeting will be held on Saturday, November 11^th.

15. The next Board Meeting will be held on Saturday October 28^th at 9:00am.

16. Meeting adjourned – 2:14pm