Approved Minutes - Wasatch Towers Special Owners Meeting Leak Investigation and Remediation November 8, 2017

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1 Approved Minutes - Wasatch Towers Special Owners Meeting Leak Investigation and Remediation November 8, 2017 Attending Board Members: Don Warmbier. Lisa Hansen, Jason Butler, John Veranth. Treo Representative: Steve Tesar HOA Counsel: Mike Miller CRSA Architects: Chris Huntsman, Steve Connell, Dave Scott Owners: Sally Assenberg, Dick Keller, Carl and Laura Warren, Clara Pugley, Gena Edvalson, Mary Carole Harrison, Yoshimi Minoshima, Mike Bailey, Tony Bailey by phone. Counsel for Baileys: Kerry Owens. Contractor for Baileys: Bruce Blaine Powerpoint Presentation The slides are submitted as a separate file. Tour of 802 Attendees were invited to walk through Apartment 802. There were multiple discussions of specific locations. The architects noted the rust in the area of the hallway leak indicating chronic wetness. Veranth answered questions about the patio drain pipes in the ceiling. Discussions Don Warmbier had individuals introduce themselves then turned the meeting over to John Veranth. Mike Miller made introductory remarks about his role and the ground rules for the meeting. Mike also discussed the plan to have a mediator allocate costs based on the provisions in the CC&Rs and a factual determination of who owns the specific building components being worked on. John summarized the remediation plan and how the project team is being organized. Questions from the floor were answered. Meeting Handouts (appended) Leak Investigation and Remediation Plan October 18, 2017 Answers to written questions submitted in advance Submitted John Veranth Acting Secretary.

2 Leak Investigation and Remediation Plan Wasatch Towers October 18, 2017 Overview The Board is committed to addressing water intrusion problems and other deferred maintenance issues in a manner that protects the property values for all owners. As a volunteer Board, we will retain qualified professionals to provide us with data, recommendations, architectural designs and specifications, and similar services. We will hire licensed and insured remediation and construction contractors to perform physical work in a timely and economical manner. This document describes the overall approach, and is based on information at the time of writing. It will be revised as further information becomes available. Quoting from the work plan by E2 on June 8: Please note that there is no way to guarantee we will find every leak origin. Also, winter conditions like ice dams can cause leaks even when there are no construction flaws in a building. Ultimately, in order to be most effective, there should be a process of elimination regarding repairs. Meaning; after repairs are made to the most likely origin of leaking, we may want to hold off on additional repairs to see how much of the leaking that origin repair solved. This will be most cost effective and confirm for us which leak origins were the worst, but will require time and patience from the homeowners and the Board. Leak Investigation At the recommendation of Treo, our property manager, the HOA hired Breck Dunham, E2 Solutions, to locate the sources of water intrusions. Their initial scope of work included: 1. The patio floor drains on levels 9 & The kick out between levels 9 & The stucco kick out above level 8's windows 4. Inspect the condition of the exterior walls and window fins 5. Interior drain leaks from levels 9 & 10, which may require removal of some sheetrock 6. Inspect the condition of the patios, roof, gutters and downspouts E2 also recommended having a commercial window contractor, a drain line inspection specialist, and a commercial roofing contractor to supplement their work. E2 presented their initial report at a working meeting on September 25. Leaks from the 9th floor patios and the patio drains were discussed. Copies of the reports have been distributed. A roofing contractor ACW Construction has inspected the roof. Planned Actions Continued investigation to include the north wall and other building areas has been authorized. Drain lines will be scoped. Immediate Damage Control Situations that are causing ongoing damage will be remediated as soon as possible after discovery. In many cases this will involve temporary repairs until the full scope of corrective action is determined. ACW Construction did temporary winter repairs to the roof using a liquid rubber coating.

3 The drain pipe leak above the 802 Hallway was repaired by K. Darby plumbing on 8/23. Planned Actions ACW Construction will do a test repair of the leak in the 9th floor SW patio. Redirecting the block underground patio drains to exterior discharge has been authorized. Further temporary and damage control repairs will be performed as situations are discovered. Professional Consultation Wasatch Towers will retain qualified professionals to provide data, recommendations, architectural designs and specifications, and similar services. Wasatch Towers will hire licensed and insured remediation and construction contractors to perform physical work in a timely and economical manner. The Board is in the process of interviewing architects with experience in repair of high rise residences. We are inviting contractors to provide recommendations on patio repair alternatives. Planned Actions See below. Remediation Design Permanent repairs to the roof, the outdoor patios, and the patio drains constitute major remodeling of the building, and the architectural control rules in the CC&Rs apply. A design for the permanent repairs will be prepared by an architect in consultation with other professionals such as a structural engineer or others as needed. The design will be reviewed and approved as described below before issuing any contracts. Not started. Allocation of Costs The allocation of costs between the HOA, the affected unit owners, and any insurance settlement will be conducted by an independent third-party to avoid conflict of interest. The allocation will be based on the obligations to maintain common areas, limited common areas, and private areas as defined in the Utah Condominium Ownership Act and the Wasatch Towers CC&Rs. Mediation is authorized by the dispute resolution provisions in the CC&Rs. The Board is in the process of determining who would be a suitable professional individual or team. This will likely be a combination of the HOA s legal counsel to interpret the HOA s CC&Rs and architectural rules, and other applicable statutes; and an architect or contractor to interpret drawings and specifications. Review and Signoff The Board and all owners of units with water intrusion damage or where physical work will take place will need to sign off on the architect s design package before conducting permanent repairs. This should take place after contractor bids have been obtained to establish firm costs.

4 Permanent Repairs Planned Actions Roof Replacement or recovering planned for Spring 2018 Patio surfaces Options for repair of the membrane below the tile are being evaluated. Storm water drains Replacement of the leaking drain pipes has been recommended. Drains improperly connected to the sanitary sewer will be rerouted to storm drain. The blocked drain below the pavement will be diverted to surface discharge. Curtain wall Repair plans are on hold pending detailed investigation of north wall, 9th floor protrusions, and other exterior shell. Spares are available to repair known missing tiles. Roof flashing repairs are needed in some locations. Other plumbing Further repair plans are on hold pending detailed investigation of area beyond the known leaks into 802. Windows Windows and window frame caulking are the responsibility of individual owners. It will be most economical to do any needed repairs as part of the curtain wall work since rigging for access will be needed for both tasks. Testing of Repairs Repaired areas will be tested for water tightness using the same approach as the initial E2 investigation. Corrective action will be taken if additional leaks are found. Interior Restoration Owners have the option of doing remodeling work at any time subject to the architectural control requirements in the CC&Rs and HOA rules. Commercial snap-in panels are available to close openings made for inspection and repair access and are recommended for both appearance and air flow control. Drywall and wood work repairs made prior to successful testing of the permanent repairs may be subject to further damage. Cost of interior restoration will be allocated by the independent third-party based on CC&Rs and applicable laws. The HOA has agreed to pay for costs associated with the leak investigation.

5 Replies to questions sent by K. Owens to M. Miller on Nov 7, 2017 LIST OF QUESTIONS FOR WASATCH TOWERS HOA BOARD Pursuant to the request of the Wasatch Towers HOA, the Baileys submit the questions set forth below in advance of the meeting at 4pm MDT, on Wednesday, November 8, The Baileys reserve any and all rights, damages, remedies and/or claims and nothing in this document is intended as a waiver of any such rights, damages, remedies and/or claims. Furthermore, by providing questions, the Baileys want to make it clear that nothing herein prevents them or their representatives from asking additional questions during or after the meeting. The questions set forth below in no way represent the entire body of questions that the Baileys have for Wasatch Towers HOA regarding the subject matter of the meeting. 1. Does the Board believe that it has now identified all the potential causes of leaks that could impact the 8th floor condominiums? A. Inspection for leaks is a phased process as stated by E2 in their proposal. The leaks from the 10th floor shower, the 9th floor bathroom, and the patios have been identified. As of Nov 7 we have not received a report on the second phase of leak investigation which includes areas such as the 9th floor bump-outs and the north wall. 2. Please list the specific causes of the leaks and tell us which condominiums are impacted by each cause. A. Apartment 802 has been impacted by the defective shower valve in 1001, the cracked drain line from 901, and from the patio membrane and drain pipe leaks. There is also evidence of window leaks into What other potential causes have you looked at and ruled out? A. Roof leaks have been temporarily patched and permanent roof repairs are planned for At this time we have no evidence of leaks from the water supply or from the heating and cooling water lines. Investigation is continuing.

6 4. Is there any additional investigation that the Board intends to do to determine potential causes of leaks? If so, be specific. A. We provided the list of nine Phase II items given to E2. 5. What specifically, in as much detail as is possible, step by step, is the Board s plan for repairing the causes of the leaks? A. We provided the 3-page Leak Investigation and Remediation Plan dated October 18, a. What is the timetable for repairing the potential leaks? We deserve to know the specific deadlines for each step. A. Work is ongoing. b. How is the Board going to make sure that the workers are licensed, have permits, have appropriate insurance and are safe? A. We will use our authority under Section 9 of the CC&Rs. The architect, CRSA, will provide construction administration and observation and will assist the board. c. What steps does the Board intend to take between now and when the causes of the leaks will be repaired to ensure that the condominiums on the 8th floor are not further impacted? For example, are you going to require tenting or winterizing of 9th and 10th floor balconies, etc.? A. This suggestion will be considered. 6. How does the Board intend to allocate the cost of repair of the causes of the leaks? A. As stated in the Leak Investigation and Remediation Plan costs will be allocated by a neutral mediator applying the provisions in the Utah Condo Act and the Wasatch Towers CC&Rs. Briefly, leaks from private areas are

7 the responsibility of the owner, leaks from common areas are the responsibility of the HOA. 7. Does the Board have an estimate of the costs of repairing the causes of the leaks? If so, what is it and who estimated the amount? A. No cost estimate at this time. The architect and general contractor will assist as each remediation phase is defined. 8. What is the Board s plan for paying for or repairing damage to Unit 802 that was caused by the testing and inspection done by E2 Solutions or any of its subcontractors? A. As indicated above, costs will be allocated by a mediator. The HOA previously agreed we would pay for the leak investigation including repairing areas opened to look for leaks. a. Does the Board have an estimate of the cost of those repairs? If so, what is it and who estimated the amount? A. No estimate has been repaired.

8 9. What claims has the HOA made against any insurance company regarding any water damage to Unit 802 and the building common areas and facilities? A. An insurance claim was made for the August 17, 2016 leak per the adjuster s report. Funds have been distributed to 1001, 901, and 802. No claim was made for the November nd leak from the 10th floor shower, but $15,000 was paid to the owners of 802 from HOA funds. 10. Do you intend to make additional claims against the insurance companies? A. Claims will be filed only if the future incident is covered by insurance and exceeds the revised deductible by a substantial amount. 11. Has the Board considered requiring the owner of Unit 901 to pursue legal action against the contractors who worked on or constructed the offending areas of Unit 901? A. This is not a board decision. Note that there has been extensive litigation regarding past remodeling of Apartment Has the Board considered requiring the owner of Unit 1001 to pursue legal action against the contractors who worked on or constructed the offending areas of Unit 1001? A. That is not a board decision. 13. Does the Board intend to fully replace the piping between the 9th and 8th floors? A. This will be determined by the architect. The recommendation from E2 was to replace the entire drain system serving the 9th and 10th floor patios. Other drain pipes are on the list of items to be scope inspected and their condition will be assessed. Domestic hot and cold water supply lines in the space between the 8th and 9th floors are the responsibility of the owners of 801 and 802 respectively.

9 14. If the piping between the 9th and 8th floors is merely repaired, how does the Board intend to prevent future leaks? A. The board will rely on our consultants and contractors to provide a professional opinion whether specific items need replacement.

10 Tony Bailey list Sent Nov 7 received Nov 8 1. When does the board expect to start work to repair the leaks? Work is ongoing. The 10th floor shower has been The pipe causing the hallway leak has been repaired. K. Darby has been hired to fix the blocked drain at grade level. We have hired CRSA as our architect to prepare a design and specifications for the permanent repairs. We are in the process of hiring a general contractor. 2. When does the board expect the work to be completed? Not known at this time. We are proceeding in an orderly manner. 3. Who will be making the repairs? Qualified, licensed, and insured contractors hired by the HOA and approved by the affected owners. 4. Has the repair work been engineered correctly? We have hired an architectural firm with experience in high rise buildings. They will hire specialty consultants such as structural engineers. 5. What are the priorities for repairs to ensure that unit 802 is useable as quickly as possible? The priority is to repair the patio leaks identified in the September 2017 report by E2. 6. How much will the dues be raised to pay for the repairs? Not determined at this time. 7. How does the Board intend to pay for repairs if/when unit owners fail to make their monthly assessments? A. We will follow the collection provisions in the CC&Rs. 8. Has the Board borrowed or does the Board intend to borrow from unit owner(s) to pay for ongoing expenses or repairs? If so, has the

11 Board paid the unit owner(s) back? A. No money has been borrowed to pay for leak repairs. This option remains open. 9. Has the Board looked into going after the contractors that renovated Unit 901 or Unit 1001 to recoup repair costs? A. See answer above. 10. We would like the Board to allow the Baileys contractor the right to inspect the work outside of Unit 802. Will the Board approve? A. This is a reasonable request, but approval would need to come from the affected owners. The board is encouraging all owners to be cooperative during the leak investigation and remediation efforts. The board reserves the rights they have under the CC&Rs to make decisions about building maintenance and repair. 11. Will the Board require that a licensed and bonded contractor, electrician, and plumber be on site when that kind of work is underway? A. Licensed contractors are required by state law and SLC building permits. 12. Will the Board require proof of insurance from all contractors A. Yes. 13. Will the Board require a security deposit to ensure contractors repair damage to walls, floor, elevator or other common areas? A. We will follow the provisions in Section 9 of the CC&Rs and the remodeling rules passed by the board. 14. Will the Board ensure the rules for oversight of renovation, repair and other work apply to everyone? A. That is our intent.