Kahler Glen Community Association Special Membership Meeting #2 19 October 2013

1. Kahler Glen Community Association Special Membership Meeting #2 19 October 2013

2. Special Meeting #2 Agenda • Call to Order • Quorum Confirmation • KGCA Board Conflicts of Interest • Status of KG Resort Acceptance/Rejection • Review PSA Terms & Conditions • Review Lease Terms & Conditions • Community Risk Analysis & Mitigation • Resolutions • Adjournment

3. Conflict of Interest Declarations • Michael Wandell, President: ~17 Shares KGR • Carol Pierce, VP: ~43 Shares KGR • John Greiner, VP: ~12 Shares KGR • Dave Reynolds, Treasurer: ~ 12 Shares KGR + $10k Loan • Nancy Miller, Secretary: ~6 Shares KGR • Dave Thorbeck, Member: No COI • Frank Niash, Member: No COI • KGR Rep (John Bennett): ~43 Shares KGR • ----------------------------- • Gary Marks: ~12 Shares KGR + $10k Loan

4. Purchase & Sale Agreement (Fundamentally Agreed) • KGCA pays $1.76M for Resort property & buildings (discounted 20% from appraised value) • KGCA performs its own community services • KGCA provides Condo, Natapoc & Forest View maintenance • Dues increase from $30 to $215 / month

5. Purchase & Sale Agreement: (Requiring Resolution) • Property service equipment purchased from Resort: End Loader, Excavator, Dump Truck, Pick-Up, Van, Groomer, Chemical Sprayer, Shop Tools.

6. Lease-Back Terms & Conditions (Fundamentally Agreed) • Golf Course & Restaurant Leased to Resort for Seasonal Operations: 10 Year Renewable Lease • Community Will Use Land for Winter Recreation • Leasehold Property Includes Golf Course, Pro Shop, Cart Barn, Driving Range & Shared Use of Maintenance Sheds • Golf Course Subsurface Irrigation Maintenance Allocated: Horizontal Piping -> KGCA; Vertical, Sprinkler Heads & Controls, Golf Course Irrigation Pumps and Electricity -> KGR • Resort Maintains Cart Paths at Current Baseline; Either Party May Improve to Establish New Baseline

7. Lease-Back Terms & Conditions (Fundamentally Agreed) • Resort Default on Golf Course Lease: KGCA Has First Right of Refusal to Purchase Golf and Equipment; No Compensation for Remaining Years

8. Risk Analysis, Risk Management

9. Risk Analysis Categories Global Golf Course Viability Basic Services Winter Recreation Environmental Restaurant Annual Assessments (Dues)

10. Risk Analysis Categories • Global (Plan B Not Approved) • Ineffective Problem Solving • Investment Disincentives • Destructive Social Environment • Agreement Delay • Bank financing • Loss of momentum • Interest rate rise

11. Risk Analysis • Golf Course Viability • Golf business failure • Golf course deterioration • Basic Services • Equipment not purchased • Management ineffective • Winter Recreation • Equipment not purchased • State contract not renewed

12. Risk Analysis Categories • Environmental • No Warranty for Pollutants • No Approval for #16 Pond • Restaurant • Annual Assessments (Dues) • Other

13. Resolutions 1. Authorize and direct the Board President to sign and record the First Amendment before signing the Purchase and Sale Agreement. The First Amendment was approved by the Association’s members on September 21, 2013. 2. Approve the transactions contemplated by the Purchase and Sale Agreement (PSA); authorize the President, the Board, its officers and the Association’s counsel to finalize the negotiations with the Resort; authorize the President to sign the PSA; and authorize the President and Board to complete and close the transactions on or before March 2, 1014.

14. Resolutions 3. Authorize the Board and its officers to raise each property owner’s dues $30 per month effective the month beginning after the PSA is signed. Currently, it is anticipated the PSA will be signed in November 2013. Thus, the dues would be $215 per month beginning December 1, 2013. 4. Authorize the Board to use funds current authorized in the budget, without to regard to budget category, as required to assure continuance of community services through April 2014.

15. Thank you for your confidence and support.