2021-2022 Annual Report & Statement

202 1 -202 2 ANNUAL BUDGET REPORT

1. Budget Summary See enclosed Budget Summary for your review. The complete Budget may be obtained by a request to evitrano@orps.com. 2. Reserve Summary See enclosed Reserve Summary for your review.

Reserve Funding Plan See enclosed Reserve Funding Plan for your review.

Major Component Repairs The Board of Directors has not deferred or eliminated any repairs or replacements of any major reserve components .

5. Anticipated Special Assessments The Board of Directors does not, at this time, anticipate the need to apply a special assessment during the course of the 202 1 -202 2 fiscal year to repair, replace, or restore any major component or to provide adequate reserves, therefore. However, the Board reserves the right to approve a special assessment for unplanned major expenses in the upcoming year. At the present time, the Board of Directors uses that portion of the monthly assessments allocated to reserves as its mechanisms to fund reserves. 6. Reserve Funding Mechanism As stated in the General Managers disclosure, Reserves are funded through a contribution of regular assessments.

Procedures for calculating Reserves The procedures for calculating Reserves can be found by referencing the Reserve Summary.

Outstanding Loans The Association does not have any outstanding loans. Insurance Summary See enclosed Insurance Summary for your review.

10.

Assessment & Reserve Funding Disclosure See enclosed Assessment & Reserve Funding Disclosure for your review. Charges for Documents provided See enclosed for Charges for Documents provided for your review.

11.

OUTDOOR RESORT - PALM SPRINGS 2021-22 Budget Summ a ry July 1, 2021 - June 30, 2022 Approved by the Board on March 15, 2021

ITEM

Annual

Monthly/Unit

REVENUE

Assessment

6,098,932 6,340,882

419.00 435.62

Total Administration Revenue (Including Assessments)

Total Rental/Reimburesement Revenue

439,050 121,150 76,950 18,000

30.16

Total Lifestyles Revenue

8.32 5.29 1.24

Total Bar Revenue Total Golf Revenue

6,996,032

480.63

TOTAL REVENUE

EXPENSE

Total Administration Expense Total Resort Services Expense

694,401 198,200 218,090 83,573 92,010

47.71 13.62 14.98

Total Lifestyles Expense

Total Bar Expense Total Golf Expense

5.74 6.32

Total Grounds & Greens Expense

1,494,160

102.65

Total Security Expense Total Mailroom Expense Total Facilities Expense

406,617 59,186 239,956 611,376 72,117 961,979 443,551 167,256

27.93

4.07

16.49 42.00

Total Maintenance & Repair Expense

Total Vehicle Expense Total Utilities Expense Total Insurance Expense

4.95

66.09 30.47 11.49

Budget Contingency

Total Operating Expense

(5,742,472) 1,123,560

(394.51)

Total Reserve Contribution Total Capital Contribution

77.19

130,000

8.93

TOTAL GROSS EXPENSE NON-ASSESSMENT INCOME

(6,996,032)

(480.63)

897,100

61.63

ASSESSMENT INCOME NET INCOME/LOSS

6,098,932

419.00

0.00

Reserve Summary (As required by California Civil Code Section 5565) OUTDOOR RESORT-PALM SPRINGS OWNERS ASSOCIATION SCT Reserve Consultants, Inc. is pleased to provide this Level II Reserve Study (Site Visit Update Report). In order to comply with the California Civil Code, specifically the Davis-Stirling Common Interest Development Act, Section 5565, we are providing the following information to the Homeowners within OUTDOOR RESORT-PALM SPRINGS OWNERS ASSOCIATION. The following study has been prepared with several assumed factors taken into account: a 3.00% inflation rate; a 1.00% return on investment (interest earned); a 3.00% tax rate on interest earned from the reserve account(s); an estimated remaining life of each reserve component; and an estimated current replacement cost of each reserve component. As of June 30, 2021, the estimated ending reserve fund balance is $4,077,000 and the estimated current replacement cost is $11,865,219 for the portfolio of reserve components. The projected future replacement cost of the portfolio is $16,261,836, calculated at an annually compounded inflation rate of 3.00%. The Association’s level of funding which is based upon the estimated ending reserve fund balance divided by the reserve components’ fully funded amount is 65.97%. This is referred to as Percent Funded. The Association would be 100.00% funded if there were $6,179,955.00 in the reserve fund. The current deficiency ( or surplus if the number is in parenthesis) in reserve funding expressed on a per unit basis is $1,733.68. This is calculated by subtracting the ending balance ($4,077,000) from the 100% funded figure ($6,179,955.00), then divided by the number of ownership interests (1213). There is currently no requirement to be fully funded. Our original analysis of the cash flow for this association indicated future inadequate funding if there were no annual increases to the Reserves. It is our understanding the Board of Directors will allocate a total of $88,027.41 per month starting in 2022 ($72.57 per unit per month for each of the 1213 ownership interests) towards the reserve fund. To offset the future cash shortfall we recommend and have included an increase of 4.05% starting in 2023 for 29 years. The increase is scheduled to take effect in the year 2023. The Board of Directors may change the amount; however, it will impact the level of funding on reserves. These numbers, by themselves, are not a clear indicator of financial strength and could indicate underfunding, overfunding, or adequate funding. The following table represents additionally required information pursuant to the Davis-Stirling Common Interest Development Act, Section 5565. Fiscal Year: July 1, 2021 through June 30, 2022

Estimated Remaining Useful Life

Estimated Current Replacement Cost

Estimated Useful Life 0 to 50 1 to 40 2 to 40 2 to 40 4 to 40 1 to 40 10 to 40 6 to 20 5 to 25 5 to 40 10 to 10 5 to 40 5 to 40 5 to 40 5 to 40 5 to 40 1 to 30 5 to 7

Estimated Reserve Allocation

Uniquely Sourced Revenue

Fund Balance on Jul 01, 2021

Estimated Interest

Location

A Other

0 to 9 0 to 14 0 to 29 0 to 25 0 to 20 0 to 26 2 to 4 0 to 13 0 to 13 1 to 18 6 to 6 0 to 17 1 to 17 0 to 17 1 to 18 1 to 19 0 to 25 1 to 3

$319,075 $206,439 $1,833,164 $1,820,228

$371,974 $79,515 $439,449 $660,085 $64,993 $584,410 $2,196 $36,565 $206,620 $69,443 $1,869 $95,909 $76,659 $75,832 $67,221 $69,282 $1,092,398

$96,376.40 $20,602.01 $113,858.98 $171,024.59 $16,839.40 $151,417.56 $568.97 $9,473.83 $53,534.19 $17,992.28 $24,849.42 $19,862.02 $19,647.79 $17,416.70 $17,950.69 $283,034.56 $21,171.45 $484.23

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

$3,331.90 $712.25 $3,936.30 $5,912.62 $582.17 $5,234.77 $19.67 $327.53 $1,850.77 $622.02

Administration CH‐El Saguaro CH‐La Palma

Gatehouse Golf Course

$79,900

$2,368,707

Golf Starter Building

$4,600

Laundry

$195,688 $506,275 $225,229 $216,134 $214,724 $215,549 $212,349 $7,200 $222,739 $2,994,022 $223,200

Maintenance

Sat (A)

Sat (all 6)

$16.74 $859.09 $686.66 $679.26

Sat (B) Sat (C) Sat (D) Sat (E) Sat (F) Streets Vehicle

$602.13 $620.59 $9,785.00 $731.93

$81,713

Taxes

$864

$223.85

$7.74

Totals:

$11,865,219 $4,077,000 $1,056,328.92 $0.00 $36,519.12

The complete reserve study is available by request from the Association.

4 4

Report Date 3/23/21 Version 1

Assessment and Reserve Funding Disclosure Summary For the Fiscal Year Ending June 30, 2022 (As illustrated by California Civil Code Section 5570(a)) (1) The regular assessment per ownership interest is $______ per month , of which approximately $72.57 is allocated to reserves, monthly . Note: If assessments vary by the size or type of ownership interest, the assessment applicable to this ownership interest may be found on the following page of the attached summary. NOT APPLICABLE (2) Additional regular or special assessments that have already been scheduled to be imposed or charged, regardless of the purpose, if they have been approved by the board and/or members: SEE ANSWER BELOW TO QUESTION #4 WHICH SUGGESTS THERE WILL BE INCREASES IN REGULAR ASSESSMENTS FOR RESERVE FUNDING. Date assessment will be due: Amount per ownership interest per month or year: Purpose of the assessment: (Intentionally left blank) (Intentionally left blank) (Intentionally left blank) Note: If assessments vary by the size or type of ownership interest, the assessment applicable to this ownership interest may be found on the following page of the attached summary. NOT APPLICABLE (3) Based upon the most recent reserve study and other information available to the board of directors, will currently projected reserve account balances be sufficient at the end of each year to meet the association's obligation for repair and/or replacement of major components during the next 30 years? Yes __X__ No __X__ Yes , if the Association follows the recommended future reserve contribution increases as outlined in the reserve study and disclosed in the table of question (4) with consideration to the note below*. No , if the Association does not follow the recommended future reserve contribution increases as outlined in the reserve study and disclosed in the table of question (4) with consideration to the note below*. *Note: The information contained within the reserve study includes estimates of replacement value and life expectancies of the components and includes assumptions regarding future events based on information provided by and supplied to the Association’s Board of Directors and/or management. Some assumptions inevitably will not materialize and unanticipated events and circumstances may occur subsequent to the data of this disclosure summary. Therefore, the actual replacement cost and remaining life may vary from the reserve study and the variation may be significant. Additionally, inflation and other economic events may impact the reserve study, particularly over a thirty (30) year period of time which could impact the accuracy of the reserve study and the funds available to meet the association’s obligation for repair and/or replacement of major components during the next thirty (30) years. Furthermore, the occurrence of vandalism, severe weather conditions, earthquakes, floods or other acts of God cannot be accounted for and are excluded when assessing life expectancy of the components. The reserve study only includes items that the Association has a clear and express responsibility to maintain, pursuant to the Association’s CC&Rs. (4) If the answer to (3) is No, what additional assessments or other contributions to reserves would be necessary to ensure that sufficient reserve funds will be available each year during the next 30 years that have not yet been approved by the Board or the members? Approximate date assessment(s) will be due: Amount per ownership interest per month: 4.05% starting in 2023 for 29 years (Current amount) X (the increases) (5) All major components are included in the reserve study and are included in its calculations. (6) Based on the method of calculation in paragraph (4) of subdivision (b) of Section 5550, the estimated amount required in the reserve fund at the end of the current fiscal year is $6,315,245.28 , as of June 30, 2022, based in whole or in part on the last reserve study or update prepared by SCT RESERVE CONSULTANTS, INC . The projected reserve fund cash balance at the end of the current fiscal year is $4,157,331.62 , resulting in reserves being 65.83% percent funded at this date. If an alternate, but generally accepted, method of calculation is also used, the required amount is $1,012,516 . (See explanation below). Explanation: Cash Flow Methodology - a method of developing a reserve funding plan where contributions to the reserve fund are designed to offset the variable annual expenditures from the reserve fund. Different reserve funding plans are tested against the anticipated schedule of reserve expenses until the desired funding goal is achieved.

SCT Reserve Consultants, Inc.

Assessment and Reserve Funding Disclosure Summary For the Fiscal Year Ending June 30, 2022 (As illustrated by California Civil Code Section 5570(a)) (continued) 7) See below: 30-Year Reserve Funding Plan Table …Based on the method of calculation in paragraph (4) of subdivision (b) of Section 5550 of the Civil Code, the estimated amount required in the reserve fund at the end of each of the next five budget years is $ (see “100% Funded” column below) , and the projected reserve fund cash balance in each of those years, taking into account only assessments already approved and other known revenues, is $ (see “Cash Flow Balance with Funding Plan” column below) , leaving the reserve at (see “Percent Funded” column below) percent funding. If the reserve funding plan approved by the association is implemented, the projected reserve fund cash balance in each of those years will be $ (see “Cash Flow Balance with Funding Plan” column below) , leaving the reserve at (see “Percent Funded” column below) percent funding. Note: The financial representations set forth in this summary are based on the best estimates of the preparer at that time. The estimates are subject to change. At the time this summary was prepared, the assumed long-term before-tax interest rate earned on reserve funds was 1.00% per year, and the assumed long-term inflation rate to be applied to major component repair and replacement costs was 3.00% per year. 30-Year Reserve Funding Plan Table

Revenue Fiscal Year: July 01, 2021 - June 30, 2022

End of Year

Expenditures Components, Taxes, Deferred Exp

Contribution, Interest, Spec Assess

Percent Funded (EOY)

Cash Flow (Balance wi th Funding Plan)

Year

Contribution Uni t/Month

Contribution %Change

100% Funded

2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051

$6,179,955 $6,315,245 $6,219,586 $6,730,948 $6,763,284 $6,927,206 $7,199,832 $7,418,262 $7,647,806 $7,974,344 $8,039,757 $7,633,512 $7,506,213 $8,250,787 $7,621,419 $7,935,868 $7,661,962 $6,101,665 $6,909,692 $7,474,947 $7,782,971 $8,061,272 $8,087,121 $8,851,970 $9,043,857 $9,458,228 $9,782,803 $9,998,304 $10,864,116 $11,417,788 $11,823,678

$4,077,000 65.97%

$4,157,332 65.83% $1,092,848 $3,996,565 64.26% $1,133,934 $4,487,529 66.67% $1,182,860 $4,471,080 66.11% $1,229,013 $4,601,017 66.42% $1,278,218 $4,859,770 67.50% $1,330,655 $5,064,956 68.28% $1,384,656 $5,282,743 69.08% $1,440,859 $5,653,219 70.89% $1,500,712 $5,703,170 70.94% $1,559,849 $5,100,827 66.82% $1,615,001 $4,882,919 65.05% $1,676,013 $5,802,099 70.32% $1,750,595 $4,816,568 63.20% $1,810,155 $5,243,071 66.07% $1,885,165 $4,806,838 62.74% $1,955,425 $2,185,409 35.82% $2,007,494 $3,174,689 45.95% $2,096,215 $3,965,969 53.06% $2,187,806 $4,416,148 56.74% $2,279,450 $4,835,790 59.99% $2,374,185 $4,959,416 61.32% $2,469,751 $5,968,276 67.42% $2,577,451 $6,441,231 71.22% $2,684,379 $7,069,667 74.75% $2,796,698 $7,665,090 78.35% $2,913,066 $8,203,708 82.05% $3,033,350 $9,598,494 88.35% $3,166,428 $10,824,288 94.80% $3,303,094 $11,891,276 100.57% $3,443,212

$72.57 $75.51 $78.57 $81.75 $85.06 $88.50 $92.09 $95.82 $99.70 $103.74 $107.94 $112.31 $116.86 $121.59 $126.52 $131.64 $136.97 $142.52 $148.29 $154.30 $160.55 $167.05 $173.81 $180.85 $188.18 $195.80 $203.73 $211.98 $220.56 $229.50

$1,012,516 $1,294,701 $691,896 $1,245,462 $1,148,280 $1,071,902 $1,179,469 $1,223,072 $1,130,236 $1,509,897 $2,217,344 $1,893,922 $831,414 $2,795,687 $1,458,661 $2,391,658 $4,628,923 $1,106,935 $1,396,526 $1,829,271 $1,954,542 $2,346,125 $1,568,591 $2,211,424 $2,168,263 $2,317,642 $2,494,731 $1,771,642 $2,077,300 $2,376,223

4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05%

30-Year Sum:

$61,158,534

$53,344,258

SCT Reserve Consultants, Inc.

OUTDOOR RESORT-PALM SPRINGS OWNERS ASSOCIATION SCT Reserve Consultants, Inc. Job No. 2006-013-16 L2

Page 9 of 67

Year 2022 Reserve Budget (AICPA Approved)

Beginning Balance Jul 01, 2021

Annual Reserve Allocation

Monthly Reserve Allocation

Uniquely Sourced Revenue

Annual Interest Allocation

Ending Balance Jun 30, 2022

100% Funded Jun 30, 2022

Percent Funded Jun 30, 2022

Location

Expenditure

A Other

$303,975 $131,328 $773,878 $1,008,038 $1,064,958 $4,230 $67,395 $298,048 $133,764 $15,821 $126,382 $147,665 $146,072 $129,485 $133,455 $1,669,750 $157,400 $3,600

65.83% 65.83% 65.83% 65.83% 65.83% 65.83% 65.83% 65.83% 65.83% 65.83% 65.83% 65.83% 65.83% 65.83% 65.83% 65.83% 65.83% 65.83%

$371,973.71 $79,515.37 $439,449.37 $660,085.38 $64,993.23 $584,410.21 $2,195.98 $36,565.11 $206,620.20 $69,442.88 $1,868.92 $95,908.65 $76,659.34 $75,832.48 $67,221.37 $69,282.35 $1,092,398.30

$96,376.40 $8,031.37 $20,602.01 $1,716.83 $113,858.98 $9,488.25 $171,024.59 $14,252.05 $16,839.40 $1,403.28 $151,417.56 $12,618.13 $53,534.19 $4,461.18 $17,992.28 $1,499.36 $24,849.42 $2,070.79 $19,862.02 $1,655.17 $19,647.79 $1,637.32 $17,416.70 $1,451.39 $568.97 $9,473.83 $47.41 $789.49 $484.23 $40.35 $17,950.69 $1,495.89 $283,034.56 $23,586.21 $21,171.45 $1,764.29

$0.00 $3,331.90

$271,575.00 $14,376.00 $47,800.00 $173,430.00 $72,000.00 $40,000.00

$200,107.02 $86,453.63 $509,444.66 $663,592.59 $10,414.79 $701,062.54 $2,784.61 $44,366.46 $196,205.16 $88,057.18 $2,369.88 $83,197.16 $97,208.02 $96,159.53 $85,240.20 $87,853.62

Administration CH‐El Saguaro CH‐La Palma

$0.00

$712.25

$0.00 $3,936.30 $0.00 $5,912.62

Gatehouse Golf Course

$0.00

$582.17

$0.00 $5,234.77

Golf Starter Building

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

$19.67 $327.53 $622.02 $16.74 $859.09 $686.66 $679.26 $602.13 $620.59

$0.00

Laundry

$2,000.00 $65,800.00

Maintenance

$0.00 $1,850.77

Sat (A)

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00

Sat (all 6)

Sat (B) Sat (C) Sat (D) Sat (E) Sat (F) Streets Vehicle

$38,420.00

$0.00 $9,785.00

$286,019.85 $1,099,198.01

$81,713.18

$731.93

$0.00

$103,616.56

Taxes

$863.98

$223.85

$18.65

$7.74

$1,095.57

$0.00

Totals:

$6,315,245

65.83%

$4,077,000.00 $1,056,328.92 $88,027.41

$0.00 $36,519.12 $1,012,516.42 $4,157,331.62

Report Date 3/23/21 Version 1 9

OUTDOOR RESORT-PALM SPRINGS OWNERS ASSOCIATION SCT Reserve Consultants, Inc. Job No. 2006-013-16 L2

Page 34 of 67

Cash Flow and Percent Funded Projections

Revenue Fiscal Year: July 01, 2021 - June 30, 2022

Expenditures

End of Year

Special Assessment, Bank & Litigation

Cash Flow (Balance w/Funding Plan)

Percent Funded (EOY)

Cash Flow (Balance without Funding Plan)

Contribution Annual

Contribution Unit/Month

Contribution % Change

Deferred & Non‐Recurring

100% Funded

Interest

Components

Taxes

Year

2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051

$4,077,000 65.97%

$4,157,332 65.83% $4,157,332 $3,996,565 64.26% $3,953,576 $4,487,529 66.67% $4,356,401 $4,471,080 66.11% $4,204,412 $4,601,017 66.42% $4,149,061 $4,859,770 67.50% $4,170,332 $5,064,956 68.28% $4,083,294 $5,282,743 69.08% $3,951,456 $5,653,219 70.89% $3,912,137 $5,703,170 70.94% $3,489,241 $5,100,827 66.82% $2,347,991 $4,882,919 65.05% $1,521,982 $5,802,099 70.32% $1,760,605

$1,056,329 $1,099,110 $1,143,624 $1,189,941 $1,238,134 $1,288,278 $1,340,453 $1,394,742 $1,451,229 $1,510,003 $1,571,159 $1,634,790 $1,700,999 $1,769,890 $1,841,571 $1,916,154 $1,993,758 $2,074,506 $2,158,523 $2,245,943 $2,336,904 $2,431,549 $2,530,026 $2,632,492 $2,739,108 $2,850,042 $2,965,469 $3,085,570 $3,210,536 $3,340,563

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$36,519 $34,824 $39,236 $39,072 $40,084 $42,377 $44,203 $46,117 $49,483 $49,845 $43,842 $41,223 $49,595 $40,265 $43,594 $39,271 $13,736 $21,709 $29,283 $33,507 $37,281 $38,202 $47,425 $51,887 $57,590 $63,023 $67,881 $80,858 $92,558 $102,650

$1,011,421 $1,293,656

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$1,096 $1,045 $1,177 $1,172 $1,203 $1,271 $1,326 $1,384 $1,484 $1,495 $1,315 $1,237 $1,488 $1,208 $1,308 $1,178

4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05% 4.05%

$690,719

$1,244,290 $1,147,078 $1,070,631 $1,178,143 $1,221,688 $1,128,752 $1,508,402 $2,216,029 $1,892,685

$829,926

$4,816,568 63.20%

$22,784

$2,794,479 $1,457,353 $2,390,480 $4,628,511 $1,106,284 $1,395,648 $1,828,266 $1,953,424 $2,344,979 $1,567,168 $2,209,867 $2,166,535 $2,315,752 $2,492,695 $1,769,216 $2,074,523 $2,373,144

$5,243,071 66.07% ($378,240) $4,806,838 62.74% ($1,712,391) $2,185,409 35.82% ($5,284,573) $3,174,689 45.95% ($5,334,528) $3,965,969 53.06% ($5,673,847) $4,416,148 56.74% ($6,445,784) $4,835,790 59.99% ($7,342,879) $4,959,416 61.32% ($8,631,529) $5,968,276 67.42% ($9,142,368) $6,441,231 71.22% ($10,295,906) $7,069,667 74.75% ($11,406,112) $7,665,090 78.35% ($12,665,535) $8,203,708 82.05% ($14,101,901) $9,598,494 88.35% ($14,814,788) $10,824,288 94.80% ($15,832,982) $11,891,276 100.57% ($17,149,797)

$412 $651 $879

$1,005 $1,118 $1,146 $1,423 $1,557 $1,728 $1,891 $2,036 $2,426 $2,777 $3,079

Totals:

$59,741,396

$0 $1,417,139 $53,301,744

$42,514

Report Date 3/23/21 Version 1

OUTDOOR RESORT OF PALM SPRINGS OWNERS ASSOIATION

N F p INSURANCE AGENCY

7/01/2020-7/01/21 COMPLIANCE DOCUMENT

3636 Nobel Drive Drive, Suite 100, San Diego, CA. 92122

Deductible

Name of Insurer

Type of Insurance

Policy Number

Limits of Liability

PHPK2154934

$7,330,642

Property

Philadelphia Indemnity

$1,000

Property

$818,800 $252,868

Personal Property/Contents Inland Marine

...

Insurance Company

$2,000,000

General Afillregate:

�---

$1,000,000

-- -

Per Occurrence

1- -----

$1,000,000

Philadelphia Indemnity

Personal & Advertising Injury:

NONE

PHPK2154934

General Liability

�

Insurance Company

$2,000,000

Products/Completed Operations:

�

$100,000 $5,000

Rented

r-----

Medical Expense. (1 person):

t-'1111au,;;;;,..,,11a 1nat:1111lllY

$1,000,000

Hired & Non-Owned Auto:

NONE

PHPK2154934

Auto

$1,000,000

Auto

Liability Limit

PHPK2154934

$1,000,000

Auto

Uninsured/Underinsured

PHPK2154934

t-n11aae,µ111d 111u.emn1ty

$4,000,000

$5,000

Crime Coverage

Emp.Theft, Forgery,Computer Fraud

PHPK2154934

--·

$4,000,000

Money Orders, fund Transfer

PHPK2154934

Philadelphia Insurance

Umbrella Policy

PHUB730382

NONE

$10,000,000

Aggregate Limit:

10%/$50,000

Ins. Co. of the West

XH0500873909

Earthquake Insurance

Limit

&8,149,442

$5,000

Philadelphia Insurance

Directors and Officers Liability

PCAP0091830318

$1,000,000 $1,000,000

Aggregate Limit: Aggregate Limit:

EMPLOYERS INSURANCE CO.

Workers Compensation

EIG295609101

None

*This Summary of the Association's policies of insurance provides only certain information, as required by subdivision (f) of Section 5320 of the Civil Code, and should not be considered a substitute for the complete policy terms and conditions contained in the actual policies of insurance. Any Association member may, upon request and provision of reasonable notice, review the associations insurance policies and, upon request and payment of reasonable duplication charges, obtain copies of those policies. Although the association maintains the policies of insurance specified in this summary, THE ASSOCIATION'S POLICIES OF INSURANCE MAY NOT COVER YOUR PROPERTY, INCLUDING PERSONAL PROPERTY OR, REAL PROPERTY IMPROVEMENTS TO OR AROUND YOUR DWELLING, OR PERSONAL INJURIES OR OTHER LOSSES THAT OCCUR WITHIN OR AROUND YOUR DWELLING. Even if a loss is covered, you may nevertheless be responsible for paying all or a portion of any deductable that applies. Association members should consult with their individual insurance broker or agent for appropriate additional coverage.•

CHARGES FOR DOCUMENTS PROVIDED AS REQUIRED BY SECTION 4525*

Property Address

69-411 RAMON ROAD LOT____,CATHEDRAL CITY, CA. 92234 _________________________________________________________

Owner of Property

_____________

Owner's Mailing Address

_____________________________________

(If know or different from property address.) Provider of the Section 4525 Items: __________________________________________________OUTDOOR RESORT PSOA

Date ________

Print Name

Position or Title

Association or Agent

Date Form Completed

Check or Complete Applicable Column or Columns Below

Not Available (N/A) Mark for

Document

Civil Code Section

Included

or Not Applicable

Purchase

Articles of Incorporation or statement that not incorporated

Section 4525(a)(1)

10.00

________

CC&Rs

Section 4525(a)(1)

40.00

_________

Bylaws

Section 4525(a)(1)

20.00

_________

Operating Rules

Section 4525(a)(1)

10.00

_________

Age restrictions, if any

Section 4525(a)(2)

Pro forma operating budget or summary, including reserve study

Sections 5300 and 4525 (a)(3)

10.00

_________

Assessment and reserve funding

Sections 5300 and 4525(a)(4)

10.00

_________

disclosure summary

Financial statement review

Sections 5305 and 4525(a)(3)

10.00

_________

Assessment enforcement policy

Sections 5310 and 4525(a)(4)

10.00

_________

Insurance summary

Sections 5300 and 4525(a)(3)

10.00

_________

Regular assessment

Section 4525(a)(4)

10.00

_________

Special assessment

Section 4525(a)(4)

Emergency assessment

Section 4525(a)(4)

Other unpaid obligations of seller

Sections 5675 and 4525 (a)(4)

Approved changes to assessments

Sections 5300 and 4525(a)(4), (8)

Settlement notice regarding common Sections 4525(a)(6), (7) , 6000, & 6100

Area defects

Preliminary list of defects

Sections 4525(a)(6), 6000, and 6100

Notice of violation

Sections 5855 and 4525(a)(5)

Required statement of fees

Section 4525

Minutes of regular meetings of the board of directors conducted over the previous 12 months, if

Section 4525(a)(10)

60.00

_________

(5.00 each)

requested

Total fees for these documents: * The information provided by this form may not include all fees that may be imposed before the close of escrow. Additional fees that are not related to the requirements of Section 4525 may be charged separately. A seller may request to purchase some or all of these documents but shall not be required to purchase ALL of the documents listed on this form. $ 200.00

Annual Policy Statement

Designated Recipient Any document required to be delivered to the Association pursuant to the Davis-Stirling Common Interest Development Act and/or any other official document shall be addressed to:

Outdoor Resort Palm Springs Owners Association Attn: Edwin J. Vitrano, General Manager 69411 Ramon Road Cathedral City, CA 92234

Right to Notice to Two Addresses A member may submit a request to have notices sent to up to two (2) different specified addresses, pursuant to the Davis-Stirling Common Interest Development Act of the California Civil Code Section 4040 General Notices to Members The Civil Code also requires that the membership be notified of the designated area for the posting of general notices. General notices (including meeting notices and agendas) are posted on the bulletin board adjacent to the Board office in the La Palma Clubhouse. All owners have the option to receive general notices by individual delivery upon written notification, provided that the request is made in writing and mailed to the Association in a manner that indicates the Association has received it.

4. Right to Individual Delivery . A member has the option to receive General Notices by individual delivery upon written request to the Association in accordance with the Davis- Stirling Common Interest Development Act of the California Civil Code

Right to Minutes The minutes proposed for adoption that are marked to indicate draft status, or a summary of the minutes, of any meeting of the Board of Directors, other than an Executive Session, shall be available to members within 30 days of the meeting. Thereafter, minutes may be obtained in the Association administration office upon payment of the Association’s costs for providing such copies.

Collection Policy See enclosed Collection Policy for your review.

Lien Policy The Lien policy can be found by referencing the Collection policy.

Rules Enforcement Policy See enclosed Rules Enforcement Policy for your review.

Dispute Resolution Procedures See enclosed Internal Dispute Resolution and Alternative Dispute Resolution procedures for your review.

10.

Architectural See enclosed Architectural & Aesthetics Requirements for your review.

11.

Overnight payments Overnight payment of assessments may be sent / delivered to the following address: OUTDOOR RESORTS PALM SPRINGS OWNERS ASSOCIATION HOA Accounting Office 69-411 Ramon Rd. Cathedral City, CA 92234-3376

Collection Policy for Delinquent Assessments

Due Dates All Regular Assessments shall be due and payable, in advance, in equal monthly installments, on the first day of each month. Special and Special Individual Assessments shall be due and payable on the due date specified by the Board in the notice imposing the assessment or in the ballot presenting the special assessment to the members for approval. In no event shall a Special and/or Special Individual Assessment be due and payable earlier than thirty (30) days after it is imposed. Payment receipts/ Overnight Payment location Owners can request a receipt from the Association which shall indicate the date of payment and the person who received it. Any request for a receipt of payment must be submitted directly to the Association's business address (separately from any actual payment). Overnight payment of assessments may be sent/delivered to the following address:

OUTDOOR RESORTS PALM SPRINGS OWNERS ASSOCIATION HOA Accounting Office 69-411 Ramon Rd. Cathedral City, CA 92234-3376

Application Payments received on delinquent assessments shall be applied to the Owner's account as follows: payment shall be applied to the principal owed first. Payments on principal shall be applied to the Owner's account by the "balance forward payment" method, i.e., in reverse order so that the oldest arrearages of the principal are retired first. Only after the principal owed is paid in full shall such payments be applied to interest, late charges, collection expenses, administration fees, attorneys' fees, or any other amount due to the Association which result in continued delinquencies. Late Charge All assessments shall be delinquent if not paid within 15 days after they become due and will result in the imposition of a late charge of ten percent (10%) of the delinquent assessment or ten dollars ($10.00), whichever is greater. Furthermore, the Association shall be entitled to recover any reasonable collections costs, including attorneys' fees, that the Association then incurs in its efforts to collect the delinquent sums.

Interest If an assessment payment is not paid within thirty (30) days of its original due date, interest may be imposed on all sums due, including the delinquent assessment, collection costs, and late charges, at an annual percentage rate of twelve percent (12%).

6. Secondary Address Upon receipt of a written request by an Owner identifying a secondary address for the purposes of assessment collection notices, the Association shall send additional copies of any collection notices required by this Collection Policy to the secondary address provided. The Owner’s notice of a secondary address must be in writing and mailed to the Association in a manner that shall indicate that the Association has received it. The Association shall only send notices to the indicated secondary address at the point in time the Association receives the written request. 7. Pay or Lien Letter If an assessment payment from the Owner is not paid within forty-five (45) days after its original due date (for example, if an Owner fails to pay an assessment which was due on June 1 and the failure to pay continues through July 15, then the June assessment would not have been paid within 45 days after its original due date), a notice of delinquency (Pay or Lien Letter) shall be sent to the Owner by regular first-class mail and certified mail, return receipt requested. The Pay or Lien Letter shall provide at least 30 days' written notice to a delinquent Owner prior to recording an Assessment Lien and further provide an itemized statement of the charges owed, including a breakdown of: (a) the principal amount owed (b) any late charges with the method of calculation used to determine such charges (c) any attorneys' fees incurred; and (d) a description of collection practices, including the right of the association to the reasonable costs of collection. A copy of the Association's collection policy shall be attached to the Pay or Lien Letter.

Internal Dispute Resolution Process The Association shall offer to meet and confer with a delinquent owner to resolve any dispute related to the total amount due from the delinquent Owner to the Association and/or the Association’s Collection Policy (“Meet and Confer Offer”). The Association’s Meet and Confer Offer shall either be placed within the Association’s Pay or Lien Letter or in a separate written communication to the delinquent Owner. An Owner who wishes to accept the Meet and Confer Offer must do so by submitting his/her/its written request to facilitate the meet and confer with the Association, which written request must be received by the Association within twenty (20) days of the date of the Meet and Confer Offer. The Association shall designate a prompt date and time for the meet and confer, at a location that shall either be the Association’s principal office, or another convenient location as designated by the Association. The Association shall designate a Board officer, along with its CID Manager to participate in the meet and confer with the delinquent Owner. Prior to recording a lien for delinquent assessments, the Association shall participate in any meet and confer so accepted by the delinquent Owner, provided, however, that the Owner’s acceptance of the Association’s Meet and Confer Offer is made within twenty (20) days of the date of the Meet and Confer Offer.

Show Cause Hearing Additionally, a delinquent Owner may be given a written notice (either in the Pay or Lien Letter or in a separate written document, as determined by the Board of Directors) of a hearing before the Board of Directors, wherein the Owner shall be invited to show good cause why (a) the Owner's voting privileges;(b) the operation of the cable television service to the Owner's Lot; and/or (c) the Owner's privileges for use of the common area/recreational facilities (hereinafter collectively "Membership Privileges") should not be suspended for non-payment of the delinquent assessment(s) ("Show Cause Hearing").

The notice and hearing procedures shall be in accordance with the following:

a. Written notice shall be mailed to the Owner not less than ten (10) days prior to the date of such hearing by first class or certified mail at Owner's last known address as shown on the Association's records. The notice shall set forth the amount of delinquency owed by the Owner and the time, date, and place on which the hearing shall be held. b. The Board of Directors shall provide an opportunity for the Owner to be heard, orally or in writing, at the Show Cause Hearing prior to making any determination on the suspension of any Membership Privileges. c. In the event good cause is not shown and the Owner's account has not been brought current, then the Board may suspend any of the Owner's Membership Privileges. Cable television services shall be reinstated upon the Owner's account being brought current and upon payment to the Association of a reinstatement assessment in an amount equal to what the Association is charged by the cable company to facilitate reinstatement of cable service. The Board shall hold the hearing in Executive Session; provided, however, if the Board is requested by a Member to have his/her matter be heard in an open Board meeting, then the matter must be heard in an open Board meeting, and not in Executive Session. d. After the Show Cause Hearing, the Board of Directors shall provide within fifteen (15) days written notice to the Owner of the suspension of any Membership Privileges. Assessment Lien a. If the delinquent Owner does not bring his/her account current within the deadline set forth in the Pay or Lien Letter, the Board of Directors shall approve the recordation of an assessment lien against the delinquent Owner’s property. The Board’s decision to record the assessment lien shall be by a majority vote of a quorum of the Board members at an open Board meeting. The Board’s action should refer to the Lot/parcel number of the property that is delinquent, rather than the name of the owner. The Assessment Lien shall be recorded in the County Recorder's Office itemizing all sums that are then delinquent, including the delinquent assessment(s), then current monthly assessment amount which will also accrue and be a part of the lien, interest, late charges, collection costs and reasonable attorneys' fees. Recording this notice creates a lien, which is subject to foreclosure, against the delinquent Owner's property.

10.

b. At the same time, the Association shall advise the Association's collection agent/bank that it should accept no further monies from this delinquent Owner until the assessment lien has been paid in full. Owners shall not send any assessment payments to the Association once the matter has been turned over to the Attorney for collection; such payments shall only be accepted by the law firm. Any payments delivered to the collection agent shall be forwarded to the attorney's office; the attorney shall then release the lien if payment in full was made by the delinquent Owner. A charge of up to $425.00 for attorneys' fees shall be charged to the Owner at this stage (pursuant to Civil Code §1366.3(a) 5650(a)). Pre – Foreclosure Actions a. No earlier than thirty (30) days after the Notice of Assessment lien has been recorded, the Association shall make a written pre-foreclosure offer to meet and confer with the delinquent Owner, consistent with the process identified in paragraph 8 herein (except that the timeline for the delinquent Owner to accept a meet and confer would be thirty-five (35) days from the date of the Owner’s receipt of this pre-foreclosure offer) or alternative dispute resolution consistent with Civil Code §1369.50 5925, et. seq. (“IDR/ADR Offer”). Owner shall have thirty-five (35) days from the date of the IDR/ADR Offer to decide whether or not Owner wishes to pursue dispute resolution or a particular type of alternative dispute resolution (except that binding arbitration is not available to any delinquent Owner if the Association intends to initiate a judicial foreclosure). b. Prior to initiating foreclosure, the Board of Directors must, in executive session, approve the decision to proceed with foreclosure by a majority vote of a quorum of the Board of Directors. The Board shall record the Board’s executive session decision in the minutes of the next meeting of the Board open to the members by referencing the lot/parcel number of the property that is delinquent. c. The Board of Directors shall not proceed with any form of foreclosure unless and until the amount of delinquent assessments (exclusive of any accelerated assessments, late charges, fees, costs of collection, attorney’s fees or interest) equals or exceeds One Thousand Eight Hundred Dollars ($1,800.00) or the assessments have been delinquent for more than twelve (12) months (“Threshold”). Once the Threshold has been met and all other requirements identified above have been completed, the Board may proceed with foreclosure of the assessment lien pursuant to the Association's governing documents and Civil Code §1367 5700. The procedure used shall be a private foreclosure, pursuant to Civil Code § 2924, et seq. and Civil Code §1367 5700. The foreclosure action shall include: • A Notice of Default and Election to Sell shall be recorded at the County Recorder's Office and a ninety-day reinstatement period shall begin. • A Title Report shall be obtained from a title company at a cost of approximately $350.00 and this shall also be charged to the delinquent Owner.

11.

• Furthermore, an additional $300.00attorneys' fees and costs shall be charged at this stage.

12. If the Association determines that the property is over-encumbered, or otherwise makes a determination that a lawsuit is appropriate, the Association shall file a personal lawsuit against the delinquent Owner to recover all delinquent assessments owing to the Association. If a lawsuit is necessary to collect the delinquent assessments from the Owner, all expenses, costs and attorneys' fees in connection with said lawsuit, including but not limited to pre- and post- judgment costs for filing fees, personal service, witness fees, interest, execution of judgment and/or writ fees shall be recovered from the Owner defendant. 13. If the delinquency is still not cured ninety (90) days after the Notice of Default and Election to Sell was recorded, the attorney shall proceed to record and publish the Notice of Trustee's Sale. This Notice must also be published three (3) times during a three-week period and posted in a public place. At this final stage, there shall be additional publication costs, as well as attorneys' fees of $125.00. If a non-judicial foreclosure sale is completed by the Association against the delinquent Owner’s property, the Owner shall have the right to redeem the property for a period of time up to and including ninety (90) days after the date of the Trustee’s Sale. 14. When a delinquent Owner has paid in full all delinquent assessments and charges, the attorney shall prepare a Release of Lien which shall be recorded in the County Recorder's Office of Riverside County, California within 21 days of receipt of the sums necessary to satisfy the delinquent amount and mail a copy of the lien release to the Owner of the residential lot. 15. PAYMENT PLAN STANDARDS The Association hereby establishes the following payment plan standards: a. PaymentWithin 60Days : If anOwner canbringhimself/herself/itself current withinsixty(60) days, inclusive of assessments which accrue within the sixty (60) days of the payment plan, the Association will forbear filing an Assessment Lien and the Owner will not incur the Assessment Lien costs if the payment plan is strictly followed. The payment plan shall include an administrative cost of $75.00. By agreeing to the 60 day payment plan, the Owner further agrees that if he/she/it fails to make any of the payments identified in the payment plan, the Association shall have the right to file an Assessment Lien without recommencing the pre-lien or Pay or Lien Notice process. b. Payment Exceeding 60Days : In light of the length of time of this payment plan, payment plans exceeding sixty (60) days shall require that the Association record its Assessment Lien to establish itself as a secured creditor. The payment plan shall also include an administrative cost of $100 or $25.00 per month of each month of the plan, whichever is greater. All costs related to the recordation of the Assessment Lien shall be part of this payment plan. The payment plan would require payment of all delinquent assessments amortized over the length of the payment plan, along with all assessments which will accrue during the payment plan. The Association shall further require that the Owner sign a Forbearance Agreement which identifies his/her/its obligations of repayment consistent with the payment plan and further provides that if there is a default under the payment plan, the Association can proceed with the collection process as particularly identified within the Forbearance Agreement. Payment plans under this paragraph 15.b should normally not exceed six (6)months.

16.

Request for Payment Plan An Owner may submit a written request to the Associationfor a payment plan consistent with either paragraph 15.a or 15.b above. An Owner can also submit a written request to meet with the Board to identify which payment plan the Owner chooses, as identified in paragraph 15 above. The Board is required to meet with the Owner in executive session within 45 days of the postmark of the request for the meeting, if the request is mailed within fifteen days of the date of the postmark of the Pay or Lien Notice. If there is no regularly scheduled board meeting within the 45-day timeline, the Board has designated the Assessment Dispute Resolution Committee to meet with the Owner. Partial Payments Ownersmaymakepartial paymentswithout awrittenpayment plan as described in paragraph 15 above; provided, however, that any such partial payment shall: a. not stop any collection action. b. not invalidate any assessment lien alreadyfiled. c. not stop an already existing non-judicial foreclosure action d. not obviate the obligation to pay all collection fees and costs inclusive of late charges, interest, management fees/bookkeeping fees, title charges, lien fees and costs, trustee’s fees and / or attorney’s fees; and e. further require (due to the additional bookkeeping and other administrative expenses incurred with a partial payment) that any Owner who submits a partial payment (without an approved payment plan as described in paragraph 15 above) will incur an administrative expense of $45.00 for each partial payment tendered and received by, or on behalf of, the Association.

17.

If this document contains any restriction based on race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, familial status, marital status, disability, genetic information, national origin, source of income as defined in subdivision (p) of section 12955, or ancestry, that restriction violates state and federal fair housing laws and is void, and may be removed pursuant to section 12956.2 of the Government code. Lawful restrictions under State and Federal Law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.

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