T.A.P.R.C. 3^RD QUARTERLY MEETING

SEPTEMBER 28, 2005

(Held at ISCO Offices in Fort Lauderdale)

The third quarterly meeting was held at the ISCO office in Fort Lauderdale on September 28th.  The Board majority, Royal Resorts, and our legal counsels from Sint Maarten and USA were in attendance 

Marina Project - A Letter of Understanding (LOU) for the Marina Project was executed between the Board and Royal Resorts. Our legal counsel in New York will keep a master copy of all the related documents on file.  Also the Architect Agreement and the Engineering Agreement were executed. 

The Board was given an update on the project. The project will be ready for occupancy in two seasons.  Occupancy of the new units will begin in mid 2007.  We received confirmation from lending institutions in Sint Maarten, that they will not provide construction loans for this project.  Receivables financing is another way to borrow some of the needed funds.  The expenses for the project thus far are approximately $500,000.  It was noted that First Caribbean or Windward banks might be interested in providing financing although they may require another party to invest approximately US$10 million cash into the project.   We need to select a competitive loan that is best for the resort.  We may also look to venture capital sources if the terms are attractive.  We will seek a letter of commitment on the receivables financing.  The tax holiday in Sint Maarten lasts for a maximum of eleven years.  

The plan is to build a full-scale villa to show owners what the new units will look like.  Pedro Espinos, Engineering Manager from Royal Resorts, will spend approximately 300 days in Sint Marten supervising the work.  He will negotiate with trades people to build the model villa. There are plans to up-grade the sales office. 

Food and Beverage Issue – Ownership of the beach bar and damage claims are on going issues.

Telem Settlement Agreement  - We are still having problems getting the agreement signed.  We have no commitment to use their service in the future.

Rental  - In the matter of the Pelican 90 square foot area in the Great House rented to Vlietman, an agreement is still pending.

Food and Beverage (New Concessionaires) - Royal will review the proposals.  To date only three groups have submitted proposals.  The final day to submit proposals is September 30, 2005.  

Pool Bars - A temporary 90-day contract was signed with Pleasant Piano N.V. (Jaap van den Heuvel) for operation of the pool bars with the possibility of accessing the beach bar once legal issues are resolved.

AGM 2005 and TAPRC - Election Documents have been prepared for the meeting. The Tuesday meeting, as there will likely not be a quorum, will lead to the Wednesday AGM meeting.  Tuesday afternoon will be the fourth quarterly Board meeting. The full 2005 Board will also meet with newly elected members to the Board on Thursday morning.  The dates for the AGM this year are December 6th and 7th. The location will be at the resort. All material needed for the AGM booklet was sent to the printer.  The booklets are ready and were delivered to ISCO offices. The staff, at ISCO, is currently in the process of putting the material in envelopes and getting it ready for mailing.   The billing process has begun and bills are currently being printed and stuffed in the same envelopes as the AGM material.

Owner questions - How should questions directed to the Board be answered?  Questions should be sent to ISCO in writing and are forwarded by PDF file to the Board.  The billing due date is January 15, 2006.  Six to seven percent is the estimate of owners who will be delinquent.  These weeks need to be moved quickly into resale if the AMF has not been paid. 

Maintenance Fees - The unpaid balance on the Special Contribution as of August 31, 2005 is $220,000 US dollars and represents 5.26% of the total amount billed The balance on the 2005 Maintenance Fee as of August 31, 2005 is $558,000 US dollars and represents 5.74% of the total amount billed. The total (uncollected) outstanding balance, including previous years, is $925,000 US dollars. Foreclosure proceedings on all SC and 2005 AMF balances have been executed (April 22 and June 16, 2005) and units are already listed for sale.  

Sales for foreclosed units have already started.  When units are put in for re-sale the unit does not sell easily except to buyers who are usually at the resort at the same time as the unit is for sale.  Buyers tend to buy the week before or after units they already own. It can take two years or more to resell a delinquent unit.  

PCIP Status   - The most recent reports on the Pelican Capital Improvement Program were presented.  The people who cash out from the program will leave room for other owners to invest to the maximum of approximately four million US dollars.  

D+O Insurance - It has been decided to renew with the same insurance carrier at the same conditions and premium. The annual premium for this insurance is $ 12,650.00 US dollars.

Collective Labour Agreement - Negotiations with both CLAs (for line employees and middle management) have ended. The documents have been signed by union representatives, and resort management. The TAPRC Chairman needs to sign the contracts as well. Both contracts provide a total increase of wages of 10% over a period of three years (2005: 4%; 2006 and 2007:3 % each year). For the year 2005, this represents an addition of approximately

$80,000 US dollars to the annual budget.  The performance evaluation program was one important point which was included in the CLA.  A new employee performance evaluation program has also been created.

Garbage Issue -Work on the relocation of the garbage compactor site has begun.  Installation of the compactor is expected to be completed, by October 5th.  The garbage compactor will be relocated next to the maintenance department.  There is a need to relocate some of the containers with new supplies to the back of the Pelican property.  The cost was $20,000 to relocate garbage and new compactor. 

Communications Material - The new edition of the On-Island bulletin has been delayed due to the work done for the AGM material.  The new expected date of completion October 30, 2005. The cost of printing this publication is around $ 800 US dollars and the revenue expected for the advertisement spaces is $1,400 US dollars.   Royal Resorts is currently working on a new web site.  The redesign should be done by November with a December launch, before the AGM.  There are only five sites that link with this.  We need a secure site so owners can pay their bills, etc.  

Re-modelling of units status – The Resort has stopped the program for the rest of the year. The units that were scheduled and were not remodelled will be prioritized on the schedule for next year.

Training Programs - We need training programs to meet the needs of the Resort.  We would need to spend over a million to produce a program for training from a commercial company.  The cost of a program from Royal would not be free.  The suggested cost would be $100,000.  Royal and the Board will work to bring the figure lower.  

Other Issues - Approximately 19% of owners don't show up at the Resort for their weeks.  The lost revenues from people not showing up is large.  We need to communicate to owners that they need to confirm they are coming or not coming.

Meeting ended at 6:00 pm.

Judy Young, Secretary

Send mail to Judy@navnet.net with questions or comments about this web site.
 

Design - Roy Martin @ roymartininc@yahoo.ca