WALLEY S PROPERTY OWNERS ASSOCIATION ANNUAL OWNERS MEETING SATURDAY, APRIL 18, 2015 1:00 P.M. (PDT) THE RANCH CLUBHOUSE GENOA LAKES GOLF RESORT GENOA, NEVADA MINUTES I. CALL MEETING TO ORDER / ESTABLISH QUORUM President Marlena Forst called the meeting to order at 1:23 p.m. (PDT) and welcomed everyone to the meeting. The following representatives were in attendance: Board Members Present: Marlena Forst, President James Pandl, Vice President Jon Nowlin, Secretary Joe Schrengohst, Treasurer Wendy Miller-Mercadante, Director Trading Places International (POA s Managing Company) Representatives Present: Loren Gallagher, President and CEO Doug Wilcox, Senior Vice President of Resort Management Luis Moran, Manager of HOA Accounting Amy Strange, Administrative Assistant Resort Management Kristen Makinen, Administrative Assistant Resort Management Haley Parker, Owner Services Supervisor David Walley's Property Owners Association Staff: Mendy Stuart, Resort General Manager Guests: Mike Fitzgerald, CPA Auditor Tom Newman, VP Summer Winds Management/1862 II. PROOF OF NOTICE Marlena Forst requested the assistance of Doug Wilcox, Managing Agent, to announce the confirmation that the notice of the annual meeting and proxy forms were mailed to all owners in good standing as of the record date, February 18, 2015. Page 1 of 7
III. VERIFICATION OF QUORUM Walley s Property Owners Association Bylaws require that a legal quorum of a minimum of 15% of the members in Good Standing be represented at the annual meeting in person or by proxy. The association consists of 5,508 intervals with 644.5 delinquent for a total of 4.863.5 intervals in Good Standing. Fifteen percent (15%) of this number is 730 accounts that are needed to meet the quorum. There were 1,117 accounts present by proxy or in person, which is 23% of the membership. Therefore, a quorum was established and business could be conducted. IV. OVERVIEW OF 2014 Jon Nowlin provided a brief overview of the accomplishments from the previous year, which have been accomplished within the constraints of rebuilding the reserve fund while limiting maintenance dues. He noted that the maintenance fees for 2015 are still 16% less than 2010, the last year under Celebrity management. Upgrades and purchases that have been made in 2014 were: TV upgrades, linens & pillows, kitchen packages. Planned external maintenance for this year includes Aurora painting and repairs of Aurora balcony decks and walkways. Mr. Nowlin commended Mendy and her staff on the improvements in resort operations. V. FINANCIAL STATUS Luis Moran, Director of HOA Accounting at Trading Places International, explained the monthly financial reporting process to the Board of Directors. Mr. Moran then introduced Mike Fitzgerald of Fitzgerald and Associates, Inc., whose firm completed the 2014 audit. 2014 Audit Presentation Mike Fitzgerald provided a brief review of each item in the draft of the 2014 audit. Mr. Fitzgerald reported that the 2014 audit includes a clean opinion and that the audit went smoothly with no issues and complete cooperation from management. The audit report reflects an operating surplus of $293,073, an operating fund balance of $359,047 and a replacement fund balance of $650,473. VI. ELECTION OF BOARD OF DIRECTORS / INSPECTORS OF ELECTION Doug Wilcox was asked by the board of directors to provide a brief overview of the election processes and candidate selection. Page 2 of 7
Mr. Wilcox then introduced the candidates who had been nominated for the board positions; they were: Marlena Forst (incumbent), Jon Nowlin (incumbent), Eugenio Antonelli, Carol Day, Henry T. Morita, and Debra Wagler. Doug Wilcox then called for nominations from the floor three times; and finding there were none, he closed the nominations. Doug Wilcox then asked for two volunteers of election who would assist in collecting any ballots to be delivered from members present whom had not yet voted or submitted their proxy. Additionally, the inspectors of election would assist and authorize the total vote tallies. The two volunteers serving as inspectors were Marian E. Wattel and Barbara A. Patterson. The candidates present were asked to make a short statement describing their position and interest in running for the board. Marlena Forst, Jon Nowlin, and Debra Wagler all provided a brief statement. Doug Wilcox took a brief moment to explain the non-cumulative voting process. Owners present were then offered the opportunity, after hearing all the candidates, to withdraw their proxy and submit a ballot if they desired to do so. The inspectors of election then retired to the separate meeting room to complete the count. Approval of Minutes Doug Wilcox asked the members to mark their ballots yes or no for the approval of the 2014 annual meeting minutes. Approval of Smoking In Units Doug Wilcox asked the members to mark their ballots yes or no for the approval of the proposed rule that all units are to be non-smoking. VII. ELECTION RESULTS Doug Wilcox announced that as was the case last year, the board had agreed that the votes for directors from proxies awarded to the board of directors would be distributed in the same proportion as all owners votes. The inspectors of election delivered their election certificate and report to Doug Wilcox who then announced the following results: Marlena Forst 1198.66 Carol Day 126.75 Jon Nowlin 1413.64 Henry T. Morita 214.46 Eugenio Antonelli 60.72 Debra Wagler 352.27 Thomas Seltz (write in) 1.00 Marlena Forst and Jon Nowlin received the highest number of votes and were therefore declared the new board members beginning 2015, each with a two-year term of office. Page 3 of 7
The draft minutes of the 2014 Annual Meeting were approved. The proposed rule that all units be declared non-smoking was approved: 1508.5 votes for approval, 196 votes against. VIII. MANAGEMENT REPORT Mendy Stuart introduced herself as the resort manager and noted that she had been with the resort for three years. Mendy then introduced management staff present, Harry Hawkins, Maintenance Manager, and Stephanie Ryan, 1862 Summerwinds Hot Springs Spa Manager. Mendy also recognized management staff not present: Sierra Sulway, Front Desk Manager, and Tatiana Robinson, Assistant Resort Manager. Mendy reviewed the reserve projects completed in 2014, as well as the reserve projects planned for 2015 and their estimated dates of completion. The 2014 projects included: the kitchen item replacements, mattress, pillows and blanket replacements; and 40-inch flat screen and blue ray players installed in all living rooms. The second phase of TV replacement will continue with installation of 32-inch flat screen TVs in all studios, and the third phase with 32-inch flat screen TVs in all bedrooms. She also mentioned the scheduled painting of the Aurora building exterior and refurbishments of the walkways as weather conditions allow. The owners were invited to view the newly renovated bath in unit 1307 and informed that all premium unit bathrooms would be scheduled for renovation in the future. Mendy thanked the ownership for their continued support of the resort staff and offered herself as well as the resort management staff present to answer any questions that owners may have after the meeting. Trading Places International Drawing Following the conclusion of management company report, a raffle was held for one seven-day vacation stay and two free exchange weeks to be used anywhere in the Trading Places system of resorts. The winners were: Earl Boynton who won a seven-day vacation stay, and Judy Jackson and Michael Daly who each won a free exchange week. IX. GENERAL DISCUSSION / OPEN FORUM Doug Wilcox asked the members to turn in their index cards with their questions on the association s resort management so that Mendy Stuart could answer them. He said that he anticipated many questions might be related to the 1862 sales and spa operations and they would be answered directly following the annual meeting by Tom Newman representing Summer Winds and 1862, the sales and spa-management entities. The following is a summary of questions and responses offered: Page 4 of 7
Question #1: Can propane grills be installed for the Dillon buildings? Charcoal grills are in place as there are no propane lines to this area of the property and adding them would be a costly liability. Question #2: Why is there a charge for pets? The charge covers additional cleaning of units required after a pet has stayed in the room, for the complimentary disposal bags on the grounds, and for staff assistance when pet messes are left. The fee is minimal at $10.00 a night; the deposit is $250.00 per stay. Question #3: Can weather stripping be installed to better secure the units for both sound and temperature control? Management has already been directed by the board to test this in certain units to confirm that it is effective before mass installation. Question #4: Can gravel is removed and colors be changed in the play area? Summer Winds/1862 owns the play area and is considering using recycled tire pieces as a softer alternative to gravel. Question #5: Why are mid-week cleanings not full unit cleanings? The rooms are refurbished with fresh linens and trash is taken during a mid-week cleaning. Full mid-week cleanings are not standard as they cost more and are not included in the maintenance fee. However additional services are available upon request Question #6: If I own a specific building can I be sure my week will be in that building? When you are reserving your owner week, you will be assigned a room in your building if it is available. Please make this request this at the time of booking to ensure that your desired rooms are actually available when you arrive. Question #7: What is the difference/relationship between 1862, David Walley s Resort, Summer Winds, Trading Places etc.? 1862 is a common brand for your resort and is used by both your association and 1862. Summer Winds, the parent company of 1862, LLC, purchased unsold inventory after Celebrity s bankruptcy and does sales and marketing of the Page 5 of 7
inventory. 1862 owns the common grounds at the resort, the restaurants and spas, and the four small cabins across from the restaurant. Walley s Property Owners Association (WPOA), you, owns the timeshare buildings and contents. Trading Places International is a management company hired by WPOA to manage the resort reservations and timeshare buildings. Question #8 Why is the logo for the resort 1862? Response It is a brand to identify your resort and has been very successful in marketing the resort. Question #9: I purchased a long time ago and was guaranteed spa privileges I no longer have. When did owners or the board vote to allow Summer Winds to purchase the spa? Your association never owned the spa or restaurants; they always have been owned by the resort developer. Summerwinds purchased the developer s rights at the resort from Celerity during the bankruptcy, with approval by the trustee and judge in that proceeding. Question #10: When will the Aurora furniture be replaced? Short term these will be replaced as needed and as funds allow. Staff has replaced broken items, such as sofa sleepers. Longer term, replacement of furniture building by building will be scheduled as funds allow in the overall reserve-funding program. Question #11: Have attempts to recover the two million dollars stolen by celebrity been made? Yes. Because of the bankruptcy, county, state and federal officials rejected such recovery of funds, as there would be no assets to recover. Question #12: When are the spa and pool free and when must they be paid for? Response During your occupancy week, there are no charges to you and your on-site guests, as owners spa usage fees are paid to 1862 as part of your annual maintenance fees. During Bonus Time, the spa is free to owners while their guests pay $35 per day. Guests staying on Bonus Time without an owner and non-owner rentals will pay $50 per day. The non-occupancy fees are set by 1862, the spa owner. Question #13 When did Bonus Time rates increase? Bonus Time rates are reviewed annually by your board and have not increased since 1999. Page 6 of 7
Question #14: What is the value of the timeshare? It must be remembered that all timeshares were sold as a vacation; not an investment that would grow and could make you money over time. The value of a timeshare interval is thus the amount that someone else willing to pay for your timeshare when you try to sell it. This may range from nothing to a significant percentage of the original price-- it depends on you, how you promote it, and the objectives of the potential buyers. The real value in a timeshare is in the amazing vacations experiences available to the owners. X. ADJOURN MEETING With no further business, the meeting adjourned at 2:48 p.m. (PDT). Submitted by: By: Trading Places International Its: Managing Agent, Approved by: By: Walley s Property Owners Association Doug Wilcox Sr. Vice President of Resort Management Jon Nowlin Secretary Page 7 of 7