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                        FREQUENTLY ASKED QUESTIONS
                            Volume 2 , Date Published: March 24, 2008

QUESTION:   Is the upcoming vote on conversion a new vote?

ANSWER:     No, the Geddes Lake shareholders have already voted to convert based on the 2002
            vote. The question before the community will be when and how. Recent
            developments in the community and economic changes in the area have made the
            conversion to condominium now, rather than later, a more compelling option.

QUESTION:   When will shareholders who might remain in a “mini-co-op” as deferred
            participants of the conversion actually know their increased costs?

ANSWER:     The exact cost of remaining a co-op shareholder will not be determined until AFTER
            the Group Closings have been completed since the cost of bridge financing will not be
            known until then. However, some of the increased costs are known or can be
            estimated based on past results. For example, the conversion fee will increase by
            30% immediately and graduate up from there depending on when the shareholder
            participates during the two-year deferment period. In addition, the cost to maintain a
            “mini-co-op” will be shared by a smaller group of shareholders and therefore monthly
            co-op maintenance fees will likely increase by 10-30% for deferred shareholders
            immediately after conversion.

QUESTION:   Will the rate charged by the primary lender, Magellan Mortgage, under Fannie
            Mae, Freddie Mac or FHA be the same or less than alternate lenders?

ANSWER:     Most lenders under these various programs charge virtually the same combination of
            rates and points. The primary lender has agreed to lower fees and zero point loans at
            competitive rates. You will not lock your rates at time of application since we can’t
            establish a precise closing date, but we should be able to lock approximately 30 days
            prior to the scheduled group closing. While alternate lenders are welcome, it is vital
            that shareholders obtain a written agreement from their lender of choice as to the
            mandatory conditions for funding. You can obtain a copy of the Alternate Lender form
            from ROA Hutton.

QUESTION:   If foreclosed units at Geddes Lake have lenders that pay the monthly fees, why
            should we worry about having other shareholders pickup the shortfall?

                                     (Continued on back)
GEDDES LAKE CO-OP TO CONDO CONVERSION                                    Page 2

ANSWER:      In most cases, banks will pay fees as long as the unit values exceed the loan amount.
             Many Geddes shareholders owe more than their units are worth in today’s market
             which reduces the likelihood that their banks will continue to pay fees while in
             foreclosure proceedings.

QUESTION:    Why shouldn’t we wait unit 2017 to convert to a condominium when the blanket
             mortgage will be paid off?

ANSWER:      The cost and exposure of staying a co-op for the next 10 years may be too high to
             bear. The blanket mortgage has a rate of 7.31% which is relatively high for the
             current market. More importantly, Geddes Lake is facing a spiral downward of prices
             which could accelerate shareholders loosing all their equity, and worse their homes.
             Conversion to a condominium, even with the projected prepayment penalty and
             today’s economic conditions, can be justified with increased unit values, the ability to
             finance the Capital Improvement Assessment and favorable refinancing options
             available today.

QUESTION:    Is the projected prepayment penalty of $2.3M fixed or could it go up before we
             close on the conversion?

ANSWER:      The prepayment penalty is tied to the U.S. Treasury rates which fluctuate daily. The
             lower the rates, the higher the prepayment penalty will be. The estimated
             prepayment penalty was based on a relatively low rate of interest prevailing at the
             time of the conversion. An offsetting factor is that the lower rates also mean lower
             mortgage rates and lower monthly payments after conversion. So, if rates increase,
             the prepayment penalty will go down but the mortgage rate for refinancing will go up.
             The bottom line is that the impact of an increase in prepayment penalty should be
             offset, in part or whole, by reduced mortgage rates.

             If you have a question on the impact to your Individual Unit Analysis, please call our
             office and speak with a Geddes Lake Conversion Specialist.

QUESTION:    Is my portion of the prepayment penalty tax deductible?

ANSWER:      Assuming the payment of the prepayment penalty is treated as an advance interest
             payment by the lender (which it normally is), you will be able to deduct the entire
             prepayment amount on your taxes in the year that it is paid.

QUESTION:    Why do I need to payoff my personal mortgage?

ANSWER:      Your own share loan which must be paid off (ordinarily through refinancing) at
             conversion since the shares collateralizing the loan will be cancelled. Although not
             typical, your lender may be interested in exchanging its collateral, in which case you
             will need to arrange a Collateral Replacement Agreement with them, which ROA
             Hutton will assist you in obtaining, provided that the balance of your conversion
             obligation can be paid in cash, line of credit or secondary financing.

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