Special Board Meeting Approved 05/13/04
Minutes
May 5, 2004
 
Present: Young, Sullivan, Wilson, King, Hughes, Justus, French, Bardizbanian, Capozzo, Sottana
Guest: Sconza
 
The meeting commenced at 6:00 p.m.
 
Topic: Report on Master Plan Phase 2
 
Revised Phase 2 Ballot Election Results
The revised Phase 2 ballot for 2.848 million passed by 43 votes.
 
Requests for Loan Proposals
Sconza reported that the Finance Committee spoke with various financial institutions, and a Club member requesting a loan proposal for Phase 2.
Two responded.  Bank of America and Assurant Real Estate (Fortus Group through Mason McDuffie Brokers).
Bank of America interest rate is 6.78% and Assurant Real Estate interest rate is 6.0%.
The committee recommends Assurant Real Estate.
 
Prepayment Penalty
Negotiations for the prepayment penalty of Phase 1 are being discussed with Mason McDuffie.  No estimates are available at this time.  The timing for finalizing negotiations are two to three weeks prior to closing. (Approximately November 1, 2004).
 
Phase 1 Up-Front Payers
Two members who paid up-front on Phase 1 do not want to be involved with the prepayment penalty.  The Finance committee prepared a "prepayment penalty credit attribute" to present to the Board.  The credit would be $1.00 off the new monthly payment or credit of $132.00.  The committee recommends not to do anything about this issue.
 
Payment Options To Members
1. Phase 1: Current payment on 15 year remaining life now at $66.00/mo. (½ to Associates).
 Revised payment for 15 years estimated at $54.00/mo +/- (½ to Associates).
2. Monthly payers can at this time elect to make a one time "up-front" payment of $6,800.00 +/- (½ to Associates).
3. Up-front payers, upon selling their membership within 10 years, will be reimbursed 10% of the up-front payment for each year remaining up to 10 years from the close of escrow.
4. Original up-front payers with continued original memberships, under the new financing arrangement, upon selling their membership, will be reimbursed $760.00 for each year remaining up to four years from the close of escrow.
 
1. Phase 2: Monthly payment for 15 years at $51.00/mo +/-
2. Up-front payment of $6,248.00 +/-
3. Up-front payers, upon selling their membership within 10 years, will be reimbursed 10% of the up-front payment for each year remaining up to 10 years from the close of escrow.
4. Associate members are excluded from this portion of the debt.
 
Cash Flow Needs
The committee is requesting C.I.F. funds of $196,960 to be set aside to finance the pre-closing cash needs.  Monies will be paid back to the C.I.F. at the closing of escrow. (Approximately November 1, 2004).
 
Young motioned to approve the proposal of Assurant Real Estate as presented with the payment fees/schedules, and borrowing from the C.I.F. to finance the pre-closing costs. French seconded.
Sullivan motioned that funds for the closing costs come from the Master Plan account with the balance from C.I.F., and the accounts to be refunded at the close of escrow.  French seconded, the motion carried.
Replacement of funds to accounts to be discussed at a later meeting.
 
The meeting adjourned at 6:48 p.m.