Key Royal Condominium Association, Inc.

Board Of Directors Annual Meeting

March 30th, 2009

Minutes of the Board of Directors Annual Meeting

Date of Meeting: March 30, 2009

Time of Meeting: 7:00 P.M.
Place of Meeting: Key Royal Clubhouse, 8204 Key Royal Lane, Naples, FL. 34119

President Joseph Kalinowski called the meeting to order at 7:01 P.M.

Call to Order

Roll Call: Joseph Kalinowski and Ken Stephens were present. Charlie Miller was absent.
Also present was Susan L. Bedyan, Steve Rodeiro; Property Managers and Association
Attorney John Goede.

Proof of Notice of the Annual Meeting and Certification

Presented by President Joe Kalinowski and Secretary/Treasurer Ken Stephens and

verified by Steve Rodeiro.

Officers Reports

Ken Stephens began by presenting the financials for the Association.

Operating Account $ 83,153.31

Escrow (Insurance) 24,107.55
Cash reserves (Money Market) 16,053.76
Egress Easement 7,040,09
CD 204,289.96

Foreclosures-13
Bankruptcies -5
Announcement of New Board Members

Joe Kalinowski reported that there would not be an election necessary since there
were only 3 candidates running for the three available positions for the Board of
Directors. The new Board will consist of Joe Kalinowski, Ken Stephens and Sharon
Stites and will re-organize in the near future.

Sharon Stites then spoke about the newsletter and thanked Joe for welcoming her to
the Board in the newest issue and clarified the website address for the Association.

Sharon also spoke about the importance of serving on the Board and how residents
can become involved in the community by serving on committees.

Attorney’s Report

John Goede spoke briefly about the foreclosure situation and gave a quick synopsis of
how Key Royal was “turning the corner” on foreclosures with each new sale and the
state of collections between November 2008 and March of 2009 totaling
approximately $61,013.48.

Questions from Owners

Sharon Stites asked a question about the concern mold and foreclosed units and how
we could influence the mortgagee to control the situation.

John Goede explained that due to the financial situation of the owner, they no longer
care about the upkeep of the unit, so the Association has the option of stepping in to
remedy the situation, but that no reimbursement will be received since a bank does not
own the unit at that time. Once a bank gains ownership of a foreclosed unit, they are
generally very good about upkeep.

Gloria Dugan asked about the timeline involved with the growth of mold and banks
taking over foreclosed units.

John explained that the Association has the discretion to enter the unit to mitigate the
mold damage, i.e. turn the electricity back on in an abandoned unit.

John also spoke about the Association’s legal vs. illegal rights as to when we can enter
a foreclosed unit. John explained that there is always a welfare and safety issue
whereby if there was ever a situation where water or mold may cause damage to a
surrounding unit, we could enter the affected unit to remedy the situation. The
Association could not, however, take possession of that unit, nor could the owner in
default nor the bank at that particular moment.
Mrs. Hasselberger asked about the causes for the delay for repossession during a
foreclosure. John explained the steps involved beginning with default on the owners
behalf and the stall tactics that the banks use to avoid paying assessments.

Patti Place asked John to clarify the timeline involved for a foreclosure. Typically,
once an owner stops paying, it takes 3 months before any type of delinquency begins.
Then an additional 30 days may pass before an attorney files court documents
followed by a 9 month or longer time frame in which a case may remain in court.

John mentioned that one particular owner made a deal with her mortgage company to
pay ½ of the total delinquent amount due without paying the Association any past due
assessments. John fought on behalf of the Association and won the case resulting in
temporary ownership of the unit in question and current collection of the rent from the
tenant by the Association.

John Foiles asked about the welfare and safety issue regarding mold and whether or
not this can cause “trigger effect” and cause the court to move a case forward during
foreclosure due to damage that can result in surrounding units.

John mentioned that courts generally reject motions to move cases forward even with
an issue of welfare and safety if mold is an issue.

Joe then spoke about the one vacant unit in foreclosure (1614) which is badly affected
by mold ( 80%) and that the Board has legally gained access to the unit in order to
immediately mitigate the damage.

Patti Place then gave a scenario about the Association’s rights to enter a unit if the
owner vacated and there was a concern about mold. John explained the danger
involved with this type of “illegal” entry and the various reasons why such action
could be dangerous, i.e. unknown occupant, returning owner, etc.

Steve Rodeiro then spoke about Management’s position regarding entry to vacant
units and probable cause to do so. In certain instances where windows have been left
open, etc., extreme caution must be taken in ensure that illegal entry, etc. cannot be
claimed by an owner.

Ken explained several unrelated instances where management gained access to units
due to suspicion of leaks or the aftermath of fire/water damage vs. just wanting to
access a vacant unit without probable cause to do so.

George Cohen spoke about how absentee owners from The Strand hire home watch
services to check on their units for a small monthly fee for peace of mind.
Steve then spoke about vacant units where the air conditioning has been turned off
and the misconception about mold developing. Unless a concern arises regarding a
water leak, insects, etc., management needs probable cause to enter and investigate a
unit. If a unit is dry, the likelihood for the development of mold is small, unless there
are obvious signs, leaking water, etc.

A discussion regarding the importance of home watch services for absentee/seasonal

owners was brought up by several residents who also felt that notifying the office of
vacation or leaves of absence was extremely important for monitoring the welfare of a
unit.

Susan King asked about whether or not any law has been passed to require
homeowners to have insurance.

Steve explained that the law is currently in effect and that owners are supposed to
send a copy of their insurance binder to the Association, but that there is no
mandatory enforcement at this time.

Susan King also brought up a point about amending our Certificates of Approval to
include owners’ insurance company coverage.

Dorothy Hasselberger asked about the new visitor parking passes and the procedure
was explained by Ken.

Susan also reviewed the system and communication to the security regarding parking
violations and how they lead up to towing.

John Foiles mentioned the noise penetrating from the tiled floor in the unit above
despite approval being granted. John feels that the rule requiring soundproofing
should be amended; whereby a discussion followed explaining the procedure involved
with attempting to amend the condominium documents.

Ken then reviewed the arrears; 13 foreclosures, 5 bankruptcies, approximately

$111,000 in delinquencies and an expected & $8,000 in collections coming in from
John’s office.

Adjournment:

The meeting was adjourned at 8:10 p.m.

Board Meetings are open to all Key Royal Residents.

Participation is reserved to Owners only.