Concerned Homeowners of Mesa Terrace Condo Assoc.: RE: [Mesaterracehoa] $250,000 Loan to HOA from Zongfu Li

Hey Jake:

In regards to:

"I asked multiple times how much debt the HOA had and never got a response.
Karla, did you not ask Lamar how much he will be charging the HOA for the BK case? What was your plan to pay for his fee?"

We received numerous emails relating to the debt of the HOA, how the previous Board spent funds, and the lack of maintenance done during your term. At a recent board meeting, Michael Gross and Michael Carmel both stated the Board did not keep up the community. If you need a copy of that recording happy to share.

I believe Karla already responded to you but I refer everyone to Lamar's filings in response to your filings. When the time is right, those judging the case will review all of your filings and then Lamar's responses and make their own interpretations of how much time Lamar had to spend responding to your additional filings.

As a follow up from my previous email, from my understanding $40,000 should have been more than enough for the HOA to re-structure.

Scott
Canyon Ridge Properties, LLC.

From: Jake via Mesaterracehoa <mesaterracehoa+jfeng20_at_gmail.com@gaggle.email>
Sent: Wednesday, May 10, 2023 8:09 PM
To: Mesaterracehoa <mesaterracehoa@gaggle.email>; mgross transcendhoa.com <mgross@transcendhoa.com>
Subject: Re: [Mesaterracehoa] $250,000 Loan to HOA from Zongfu Li

Hey Sam,

I understand your frustration and I feel the same. However, I need to put the facts out there so every homeowner is well informed.

We, as the board, are raising money to pay for legal fees that were generated prior to us coming to the board. We need 250k to pay for past expenses. The BK attorney-Lamar Hawkins is asking $160K from the HOA for the work that he has already done! We also have to pay for Scott Potter's fee, as well as the trustee's fees. Scott P and Lamar H were hired by Scott G, Karla and Mark. Mr Li and I were against the BK filing. Scott G, Karla and Mark would not listen. I asked multiple times how much debt the HOA had and never got a response.

Karla, did you not ask Lamar how much he will be charging the HOA for the BK case? What was your plan to pay for his fee?

We have no way to make any of those payments. We are actively seeking any sources of funding available. Please let us know if anyone is willing to loan money to the HOA.

Thank you

On Wed, May 10, 2023 at 4:33 PM Sam Biggs via Mesaterracehoa <mesaterracehoa+maaly_at_me.com@gaggle.email> wrote:

IF this is accurate, this would be a massive conflict of interest and should require a vote by the association members. The board should not be able to vote to borrow money from another board member, or any related entity. Any competent attorney should see that conflict of interest. Also, the HOA should not be able to borrow money under its current financial situation. We had a vote for an assessment and the vote was 100% in the negative. Now you are side-stepping our vote and you are going to borrow the money. Seems like we need a better financial manager, not a loan. If the attorney can't get paid, so be it. They will have to wait like all of our other projects that need money.

There is a reason our bank accounts are empty 1) Under Zongfu's prior board leadership we had around $250,000 and by the time he (and the board) was done more than $200,000 was gone, spent on legal fees. 2) Scott's board put us into a bankruptcy plan which is costing hundreds of thousands of dollars in useless legal fees. They had a simple solution at the time... raise the HOA dues so we could pay our own way out of the debts. That would have solved everything! They refused to take the approach and so here we are spending all our money on legal fees.

The solution remains the same: Get the attorneys and legal system out of everything and let us manage the association with Transcend or any professional management company. Legal fees are anchoring us and we can't come up and breathe. The problem keeps coming back to Zongfu's and Scott's legal quarrel that started this whole thing and put the community squarely in the middle of it. You two are the problem. You just can't let it go. Neither of you should be on the board, but you both have too many votes to make that happen.

Zongfu, if you are going to make this loan, you need to resign from the board and let a new board vote on this.

SAM BIGGS

President

480-584-3450 O | 480-203-7768 C

3514 N. POWER RD. STE 132 | MESA, ARIZONA 85215

On May 10, 2023, at 3:02 PM, Scott Gordon via Mesaterracehoa <mesaterracehoa+scott_at_gordon.bz@gaggle.email> wrote:

Zongfu:

Care to inform the homeowners of your decision to loan the HOA $250,000 at 7% interest just to pay a portion of legal fees with no funds being spent to repair/address open HOA Issues?

This is on top of the $40,000 you have already loaned to pay Michael Carmel's first invoice.

Per Michael Carmel the loan was already discussed in an executive session earlier this week. Per his filing the loan was already decided on. He didn't even wait to file his motion with the court for the official open Board meeting to take place.

HOA sent a notice about a meeting yesterday with no agenda to the Homeowners. Is the Board hiding the fact that they are going to execute a loan on behalf of the Homeowners for $250,000 and Zongfu Li, President of the HOA is going to sign off on his own loan to the HOA?

The Board, who has a fiduciary duty to the homeowners believe this action is in the best interest of the community?

Definitely news worthy…

Scott

Canyon Ridge Properties, LLC.