Red Frog Strike Resolved!

We are very pleased to report that we have finally come to a complete agreement with the Labor Union and the labor strike was officially settled today!!!

Now that we have been able to make this huge step forward, please understand that there are several processes that we need to work through before we can actually get back to work. These processes will take some time as we continue to work with the Labor Ministry and all past Pillar Construction employees. During that process, we will also start to slowly mobilize our operations team as well as work to complete the conversion process for those few remaining clients.

Again, we wish to express our great appreciation to you all once again for your tremendous patience! We will be able to provide more details on our next Conference Call on Tuesday October 28 at 3:00 pm CST. We will be sure to send another reminder for that call the week before with all of the call in numbers. So thanks again and we look forward to getting back to work and making this beautiful project a long term success!

Note: This was hinted at in the September conference call since it would have to be settled before new money would come into the project. This is a great step forward, and good news for Red Frog investors!

Safety Tips About Rip Currents

Apparently someone from Tahoe, California got caught in a rip current in March, 2008 on Red Frog Beach and died! This is good information for everyone going into the ocean.

Bocas declared Special Tourist Zone

Notice came today from the Red Frog team:

We just received notice today from our legal team that the latest Panama Government Official Gazette that was published yesterday included the great news that the long-awaited Declaration of the Special Development Zone for Bocas Del Toro was finalized!

In the words from one of our team, "The declaration is for the Bocas Del Toro Province. Isla Bastimentos and the National Park are definitely included. Yes, it is a light in the tunnel. We still have a lot of work to do. Tomorrow I will go to Catastro to check on the next steps since they were waiting for this declaration too. Then I will go to Pronat to get the copy of map of the declared area. I know that Red Frog is included, but it is good to have a graphic view of the declared area."

So while this is just one step in the process, we are very happy to finally see it completed. Maybe all of those meetings with government officials have finally paid off. But as our attorney mentions above, we still have a long way to go in this process as there is definitely going to be a lot of internal government debate on all of the precise rules and regulations. Especially important to us all will be how they decide to value our various parcels of land. And from what we have heard, no one in the government is anxious to stick out their neck and make policy which will be criticized no matter what is decided. Some outside attorneys have speculated that the titling process could be pushed into the next administration (which starts September 2009). Let's hope not.

-Red Frog Team

Minneapolis owners' meeting a success

I received a note from Chris Hahn regarding the owners' meeting that took place last week. He was kind enough to allow me to post it here. As many as 90 owners attended, and I'm told most of them came away with a pretty good feeling that construction will start up again soon.

Here is Mr. Hahn's e-mail message:

Hello Neighbors,

I wanted to take this opportunity to send a heart felt thanks to everyone again for not only taking time out of your busy schedules to attend the owners meeting, but for all your great input and participation at the meeting, which I think was the main reason for the meeting's success. I also wanted to make sure you all knew how much I appreciate all of your kind words and support that you have extended me over the last several weeks, because frankly I did not know if I made that clear enough at the meeting, because as you know I was very sleep deprived and exhausted.

The other main purpose of writing to you all is up until now I have basically been the face of the owners meeting if you will, and now that things are beginning to evolve into something much larger, I strongly feel that the new face going forward should be our designated owners group and newly formed committees, because it’s a team effort and it has grown well beyond my capacity to successfully manage and attend to all of the many moving parts and details that are required. For instance, I had over 30 emails and phone messages waiting for me when I got home Saturday from the meeting ranging from wanting my advice and/or information on a wide-range of topics from Residence Club to the owners meeting , which I am very happy to see and humbled by, because its important that everyone is well informed and is brought up to date on the events of the meeting, but frankly there is not enough time in the day for me to respond in a timely fashion and effectively communicate to you in a way that you all deserve. So with that said, going forward everything will be transitioned and channeled through the 6 and probably soon to be 7 member owners group, which will be primarily responsible for representing our fellow owners best interests, and to be a liaison between Pillar and the owners at large. Also, our newly formed committees will also be a valuable resource for all the clients/owners to utilize and assist as well. More details on the owners group and committees will be sent out shortly. Please keep in mind that I’m not suggesting that you can’t pick up the phone and call or email me or any of the other group members for that matter, we certainly all welcome that of course, but I think its vital going forward that we all have a system in place that eliminates any breakdown in communication that leads to misinformation or misunderstandings that unfortunately has been the case in the past, and also provides accurate information in a timely and efficient basis.

At this time, I would please ask everyone to be patient as far as receiving information on the meeting, the owners group is currently working very hard to dissect and organize the large amount of information that came out of the meeting. We will be sending out a very detailed email this week that will discuss the highlights and salient points from the meeting, and will be followed-up very soon with a breakdown of all the agenda questions that you all sent in, including Pillars responses. In the meantime, I would kindly ask that those owners that did attend the meeting to please reach out to those owners that could not make it and share with them your thoughts and feelings about the meeting if of course you feel compelled to do so.

In closing, I would like to say that all future correspondence and perspectives relating to RF business will be coming from a diverse group of your fellow owners, the owners group. This is obviously a very good thing, because it means that my original idea is developing into what I had envisioned, and that is, all of us owners/neighbors are starting to unite together in order to be part of the solution to not only protect our investments, but to find productive and constructive ways to realize and fulfill our dreams. What is even more exciting to me is that I think we have only scratched the surface, and that we are at the threshold of doing something very extraordinary and revolutionary, because what I personally took away from the meeting was that Pillar is now completely committed and willing to work with us owners in good faith, with transparency and accountability to do what it takes to make sure that Red Frog succeeds, and us in the process. Actions always speak louder that words, but I truly believe we have a real partnership with Pillar now.

Again, my many thanks to all of you that participated in the meeting, and making it possible for us to change our reality for the better, for not only ourselves, but for all of us collectively.

Your friend and neighbor,

Chris
Lot #46

What about my prescriptions?

I had a thought the other day as I went to the pharmacy to refill my prescriptions. What am I going to do if we end up spending extended periods of time in Panama? Who do I turn to? Of course, I e-mailed my friend, Sam Taliaferro, of PrimaPanama and developer of Valle Escondido in Boquete. Here was his response:

You can have prescriptions sent down through mail forwarders. I have suppliments sent regularly. The pharmacy's are fairly well equiped and will probably have what you need. You just need to check the costs out when you get down here.

I had hoped that the laws for getting the medicines we need were a little more relaxed as I am told they are in Mexico. Sam says many drugs may be purchased over the counter that require a prescription in the US. In my research, I found a website from Panama Law that talks about this in more detail.

- Mick @ Lot 83

We've decided to stay...

My post from the http://www.redfrogbeachforum.com today:

Thanks to many of the owners who have contacted us recently after seeing my posts at http://redfrogblog.blogspot.com. Your input has made all the difference. Before we heard from you, we felt we were all alone out there; torn between sticking with it and wanting to see Red Frog succeed or getting our money out and moving on. We have decided to do the former.

Joe and Dan have been exceptional at explaining their position and our options; they have worked exceedingly hard at helping us find a solution to our unique situation. They were very good at making lemonade out of lemons!

At first we were not thrilled at having our dreams of a beach front villa wiped out. And fractional ownership was the furthest thing from our mind. We wanted to have our own place, decorate it like we wanted and rent it or not rent it out. That may still happen, but not until Phase I is completed. So our next question was, what do we really want?

We are now convinced that fractional is a good alternative for the short term. We will be able to visit to see if we even like living on Bastimentos, or if we really want to build that dream home on the Caribbean! Plus the host home could be done as early as the end of the year if the project starts back up. That certainly is a lot better than waiting possibly 2-3 more years for titling on our rights of possession lot so we can finance our villa (or worse, having to come up with 100% to build it!). If we don't like it, there is a good chance we can sell the fractional and get our money out that way.

For those of you naysayers, you probably think I have drunk the Kool-Aid. Those of you who are already onboard, you have probably come to the same conclusions we have and have made or are contemplating making a deal to get this project back on track. We believe this is the best solution for all of us; to get the project built. Good luck to everyone at the owners' meeting next month in Minneapolis. We will not be there. We are told the room is FULL! Most of the attendees I have communicated with are very positive about finding solutions. I think it will be a most enjoyable event!

If you have questions or concerns, e-mail me mick@sfresidence.com!

Mick & Janis Lot 83

Question about weather in Bocas

Because of the way Red Frog is restructuring some of the owner's positions, we have given up (temporarily) our dream of having our own villa on the beach and decided to choose a fractional ownership. Although it is not our original vision, we feel it is better to have something now rather than nothing later.

So my question is this, now that we have decided on a fractional ownership, which "permanent" 2 weeks should we choose? We told Joe we wanted a time when it is not raining... He laughed and asked us if we saw how green it is in Bocas, and if we ever considered how it got that way???

Seriously, we know it rains in Bocas. But some months are generally better than others, and we would like input on which weeks to choose. For now we have made a choice on our permanent 2 weeks and are happy with those (provided we get them) but wondered if others had considered this?

Here's what we've heard:

The rainy season is technically June-August and December—January; However, based on our data, there is a consistent amount of rainfall month to month (most of the rain in Bocas occurs at night). The daytime showers are typically “hard and fast.”

Here is a note from Ryan Bullock who has lived in Bocas for sometime:

May is a pretty good month. September/October/November are usually pretty dry months – although I think one of the biggest storms we had last year was in September.

Remember, during the “rainy season”, Bocas typically gets short “showers” that usually only last an hour or two. Many times, the clouds clear in the afternoon and create good beach weather. I think June/July is nesting season for some sea-turtle species, too…

Mick @ Lot 83

Red Frog is making positive steps to get back to work

Just a quick note to say thank you to Joe and Dan for working with us to come up with a compromise that will help both parties, and will hopefully get the project started back up soon!

If you have any doubts about the intentions of these guys, take my word for it, they have been very helpful in getting us repositioned with equity ownership instead of our promise to purchase contract.

Their expectation is that by restructuring the debt into equity, Red Frog can get funded and building can begin again. We are eager to see them get back to work!

Mick @ Lot 83

Rights of Possession Explained

Here is an article sent to me by Don King, a Realtor in Bocas, who has 3 acres (front one is on the beach) for sale down at the end of Red Frog Beach for $299,000 (no improvements). He was kind enough to send me a link to an article that explains the very confusing rights of possession laws in Panama.

The article is about 1/3 of the way down the page AFTER the vegan article!

Here is an excerpt:

If you contemplate buying land in Panama, you should know about a unique feature of land ownership here know as “Rights of Possession”. There are in fact three types of “ownership”. There is titled land which is registered in the Public Registry. There is land owned by the Government and there is land for which, by virtue of having occupied it, a person has earned the “right to posses” it.

The history of this goes back to land reform which was instituted by Gen Omar Torrijos whose military dictatorship from 1968 to 1981 brought a number of social reforms. He introduced an agrarian land reform program which in essence stipulated “if you live on the land and work the land you have the right to possess it.

Rights of Possession are duly recorded and can be transferred to a third party including foreigners but it is the Ministry of Agriculture Agrarian Reform Offices, not the Public Registry, which records Rights of Possession on agricultural lands. The Directorate General of the Surveyor of the Ministry of Economy and Finance records island, beachfront and marine properties. The rest of the ROP's are not recorded.

There are two kinds of Rights of Possession:Those located in national lands subject to the jurisdiction of the Directorate General of the Surveyor of the Ministry of Economy and Finance. This type of ROP segregates into those subject to titled and those subject to an administrative concession (lease). The Rights of Possession subject to an administrative concession are beachfront, marine bottom and islands. Concessions are explained below.

Those located in agricultural land which have been allocated and transferred to the Department of the Agrarian Reform of the Ministry of Agriculture for the specific purposes to grant titles for agricultural use.

When it comes to trying to find out who possesses what the process can be tedious. An administrative system exists for the documentation and certification of ROP land. Employees of the regional offices of the Agrarian Reform, local Mayor's office, property tax office (Catastro), and justices of the peace (Corregidor) oversee and manage this system of documentation.

Mick @ Lot 83

Owners Meeting

Red Frog owners are gathering in Minneapolis on May 16th to have a meeting. I'm told they meet first, then Joe and Scott (essentially what's left of Red Frog management) will be brought in to address the owners' issues. Here is the e-mail I received:

Let me start off by thanking everybody for your strong interest and support of the owners meeting on May 16th in Minneapolis. To date, we already have 32 owners confirmed to attend the meeting, with another 7 pending. Also, many of you offered to help with the meeting, which I appreciate very much, because we could really use your help and assistance in making this a successful meeting for all us owners.

First of all, we need two or three owners to put together the agenda for the meeting. I will be sending out an email shortly requesting that all owner’s summit questions and topics they would like answered and discussed. Those questions and topics will be sent directly to the owners responsible for compiling and organizing the agenda, and once completed, will be distributed to the owners and RFB prior to the meeting. We are also looking for a moderator/facilitator to help run and control the meeting. We would like to ask that owners either recommend someone you think would be a good candidate or yourself if you are interested in the job. After consulting a few other owners we determined that the ideal candidate should be an owner that is fine with not actively participating in the discussions. We feel it’s very important that this individual be neutral and impartial when moderating the meeting. Obviously the meeting will be comprised of many owners that have a wide-range of varying viewpoints, and we want every owner to have an opportunity to participate and feel completely comfortable in expressing their thoughts and opinions.

Lastly, there are many owners that would like to be at this meeting, but will not have an opportunity to join the rest of us, but it’s clear from their comments to me that they are very interested in knowing what is said and discussed at the meeting. We would like to hear from the owners what you feel would be the best method in providing them a summary of what takes place at the meeting, keeping in mind this is an 8 hour meeting. We are looking for ideas that are relatively simple, effective, efficient, and ideally does not cost money. There have already been some good suggestions tossed around. For instance, having RFB answer in writing all the agenda questions prior to the meeting and then distribute to all the owners after the meeting. Have a few people take notes … are there any stenographers or owners that know short-hand among us? Or maybe we do a combination of things to document the meeting? Please let us know your thoughts?

So please everyone give some thought and consideration to what I stated above, and please respond as soon as you can, because there are so many things that still need to come together and happen, and we don’t have a lot of time before the meeting is upon us. Also, would you please email your replies and suggestions to John Cloutier at johnjcloutier@comcast.net and please copy me on the email as well at christopherahahn@bellsouth.net. John has been assisting me for some time now and was kind enough to volunteer and field the requests above. I would also like to acknowledge David Gramling’s efforts in taking care of the meeting location and hotel accommodations, which we will be sending information about real soon.

Thank you all very much in advance for helping out and assisting in putting together what I hope will be a productive and positive meeting for everyone.

I hope I am not out of line posting this message, but I think it deserves publication. All along, I have strongly supported the Red Frog project, but now we are not sure. We are interested in staying in touch with anyone who wants to discuss this.

Mick & Janis @ lot 83

Contradictions everywhere

To be fair, the person that told me about the Union and Red Frog having to pay them for being out on strike is the attorney who used to work with them and has an axe to grind because they owe him money.

I spoke with Sam Taliaferro and Paul McBride who have never heard of such a thing. Neither have other people who do business down there, so I am not sure this is fact.

I do know that the owners are having a meeting in Minneapolis in a month or so, and the Red Frog "Team" (now consisting of Scott and Joe) will also be attending.

- Mick @ lot 83

Panama labor laws

Recently we had a conversation with an attorney who told us that every day the labor strike goes on, Red Frog is responsible for a day's wages for each and every employee that is on strike per the labor law in Panama.

This would put to rest any ideas I had about why they haven't ended strike. My theory was that, while waiting for the second round of funding, Red Frog was smart in not settling the strike as they would have all these workers sittin around getting paid for doing nothing. Now it seems that this might be the case anyway.

Does anyone have any more information on this issue? I sure would be curious. If this is true, they are getting deeper into debt the longer the strike goes on.

Mick @ Lot 83

Conference call concerns

The comments published to my Monday article about pending lawsuits are starting to sound reasonable. While I have hung in there with Red Frog management, the time has come to start talking specifics. And several concerns were raised after yesterday's conference call.

1) ROP LAND: It was a brief mention, but concerns some of us with Rights of Possession land. What I heard was, if titling doesn't happen by the time construction is completed on these lots, the owner will be forced to come up with the entire balance of the purchase price. THIS IS NOT ACCEPTABLE. We were promised from the start that the "sweeping" title would be in place before any building would be done on ROP land so that we could get financing. But it did not sound like that after yesterday's call. Not having title would also hurt resale value as well. Red Frog better figure out a way to finance this small portion of their property, otherwise they are going to lose those of us who have been supporting the project!!!

2) FINANCING: Did I hear right? They are going to qualify all buyers AFTER THE FACT? This is a lawsuit waiting to happen. They made these contracts in good faith that buyers would go through with the purchase. Now they are going to make everyone go back and qualify? And what happens... after 4 years... that circumstances change and people won't qualify now? Seems to me they should have done this BEFORE they went into any contract with buyers.

Don't get me wrong, I want this project to succeed, but I also want them to do what they promised us from the beginning. I'm sorry that the government is so slow at the titling process. But they should then give us the option to back out and get our money back, NOT offer us a fractional ownership.

If anyone is contemplating a lawsuit, please contact me by e-mail at mick@SFResidence.com. I am eager to see what people are thinking. Seems to me it might be a tactic to get out of the agreements since a lawsuit or lawsuits would only hurt the possibility of Red Frog getting more funding. It might be easier to pay everyone off who wants out and be done with it.

Mick @ Lot 83

Conference call Tuesday, 3/18/08

Please be informed that we will be conducting our next Client Conference Call on March 18th at 5:00 pm EST (4:00 pm CST, 3:00 pm MST, 2:00 pm PST).

If you are an owner, e-mail Scott Harris for the call in number and conference ID.

Hints of lawsuits permeate the air

I heard through the grapevine that some investors in the US were banding together to draw up a lawsuit. I wrote Scott Harris an e-mail asking him if he could shed some light, and he admitted that he heard something about it. There are several points:

1) Any lawsuit in the US would be moot since there are no assets being held there. All assets are in Panama so the lawsuit would have to start there. And apparently they take longer there than they do in the States.

2) A lawsuit in Panama would turn off any potential investors that might be interested in the project (the only hope we have of getting construction started back up). And then what would happen? Sell off the land? Given the current big project situation in Panama, there is nobody doing them right now, especially with the titling issues we have at Red Frog.

Tomorrow's conference call may or may not talk about this new development, but I thought it should be addressed here.

Mick @ Lot 83

Question about the February 2008 conference call

There was a question about what happened in the February 2008 conference call and the answer is... nothing new to report. Strike is still on, no work is being done and the second round of funding has not happened although they may have found someone who will fund without the entire project being titled... possible bad news for those of us with Rights Of Possession properties.

- Mick @Lot 83

Red Frog conference call scheduled for tomorrow

Well, the strike is not over yet and the principals have said that February's conference call will have little or no new news. So there is not going to be much to say.

January's conference call did have some significant changes to the business structure and ownership of the partners but until the Rights of Possession land becomes titled, there will probably be no forward movement. They just can't get funding until they do.

So although I will attend the call, I expect it to be a snoozer!

Mick @ Lot 83