Request for Detailed Explanation of Repeated Assessments and Insurance Premium Increase

Dear Board of Directors and Management,

I hope this message finds you well. We are writing as concerned shareholders regarding the continued special assessments and the financial management of Whitehall Terrace Owners Corp.

In 2024, we received notice of an additional $2,000 + charge per shareholder, which was described as a temporary, one-year assessment. We accepted this with the understanding that it was a one-time need. However, in 2025, shareholders were again notified of an additional three-month special assessment to cover a $30,000 insurance premium has been imposed with extremely short notice.

As shareholders who has consistently paid maintenance on time and contributed to the financial health of the building, I respectfully request answers to the following questions:

1. Assessment Transparency Why were shareholders told the $2,000 in 2024 was temporary if additional assessments were going to follow? Why was a three-month special assessment charge added in 2025 before the current insurance assessment?

2. Insurance Premium Increase The April 30 letter states the premium amount is “over $25,000,” but the drawdown and assessment total $30,000. Please clarify the breakdown. By what percentage did the insurance premium increase from last year? Did we switch insurance providers at any point in the past 5 years? If so, why, and what were the cost differences? Were competitive quotes from other insurance carriers obtained before finalizing the new policy?

3. Use of Maintenance Funds                Prior to 2024, our regular maintenance payments fully covered the building’s operating expenses. What changed? What is the current balance of the operating and reserve accounts? Were there any unexpected major expenses or deferred costs not communicated to shareholders?

4. Communication and Governance Why was the latest assessment notice given with just 1–2 days before implementation? This gives shareholders no time to ask questions or plan their finances. Will the Board consider holding a special shareholder meeting to discuss these issues and allow residents to voice concerns? Has the Board conducted or commissioned an independent financial audit in the past two years? If so, can a summary of the findings be shared? What long-term financial planning or forecasting is in place to avoid continued special assessments? Are there any projected capital projects or known upcoming costs that might result in future assessments?

5. Board Meetings and Financial Reporting Why has the management company not organized a shareholder meeting or annual board meeting in the past two years? Why were the annual financial statements for 2022 and 2023 not sent to shareholders?

6. Insurance Procurement, Oversight, and Conflict of Interest Concerns We respectfully request that the Board and management share at least five competitive insurance quotes, including the lowest-cost quote with the highest deductible. Please clarify whether shareholders will be allowed to submit cost comparisons from independent insurance providers for Board consideration. Given the rising cost of insurance — which we estimate may now exceed $100,000 annually (up from approximately $92,000 in 2023) — we request a full breakdown of the current premium structure and deductible terms. We are deeply concerned about the possibility of financial mismanagement or illegal self-dealing between the Board, management, and third-party vendors. Accordingly, we request an independent review of the insurance procurement process, including disclosure of any commissions or incentives. Transparency in vendor selection is essential. If any conflicts of interest are discovered, we expect immediate and appropriate accountability.

7. Management Company Review (Contingent on Resolution of Above) Since the management company change, shareholders have observed rising operating costs and reduced communication. While this is currently a lower priority than the insurance issue, we strongly recommend initiating a cost-comparison study of alternative management companies in the near future. Depending on the management company’s level of cooperation with the six points outlined above, we may reevaluate whether current management is serving the best interests of shareholders. As shareholders, We believe in transparency and collaboration. We trust the Board has acted in good faith, but repeated surprise assessments, lack of clear financial reporting, and minimal notice have created serious concerns in our community. We respectfully ask for a full and honest explanation. Thank you for your time, and I look forward to your prompt response.

Sincerely,

Concerned shareholders Whitehall Terrace Owners Corp.                                  

Optional Note for Physical Distribution: If you are a tenant, please share this letter with your landlord. Rising assessments and maintenance costs could increase your rent. This message is from concerned shareholders requesting transparency and accountability from building management.