HERAKLION PREFECTURE MERCHANTS

Heraklion 12/02/2014

Dear colleagues,

We are delighted to announce that the final Environmental Study (after four consecutive applications in the past) has been approved by the Special Secretariat for the Environment of the Ministry of Environment Energy and Climate Change, and the final approval of the Urban Planning Study is now a matter of time. The last step remaining is the validation of the Urban Planning Study by the Council of State. After the validation decision by the Council of State, the Cooperative will be able to legally distribute the land plots to the beneficiaries, after elaborating the Application Study at a cost of approximately 200.000 €.

According to the law, in order to issue building permits for each plot, the basic infrastructure works must have been completed up to at least 75 % (road construction and basic networks such as water, sanitation and electricity). It should be noted that it is not required to construct the wastewater treatment plant before the completion of construction of the first 20% of the projected residences i.e. approximately 130 houses.

As everybody understands our efforts and sacrifices so far are coming to an end. What remains is only a small final effort which is, each one of us, to gather within a reasonable time the amount required in order to implement the application study and carry out the infrastructure works mentioned above, a fact that will maximise the surplus value that each plot in our residential complex can have.

We are aware that the current financial situation is posing difficulties for everyone and it will be very difficult for many to raise the amount required.

We have visited a development and feasibility studies agency to search for the possibility to apply for a European or non European program, a possibility which has been excluded straightaway since Building Cooperatives are not supposed to be funded. The only possibility would be if the Municipality of Agios Nikolaos was willing to integrate the infrastructure works of the cooperative to the National Strategic Reference Framework (NSRF) on the condition that there are mature project studies (in our case to have implemented and approved the Application Study).

Therefore we visited the Town Hall of Agios Nikolaos along with the adjacent Cooperative of the Hellenic Telecommunications Organization (OTE). The Mayor told us that the Municipality cannot promise the integration of our project since the financial framework of the municipality of Agios Nikolaos is not yet defined and there are many other priorities as well. However, we continue to look for other options in order to be included to another program (we are even considering the possibility to change the statute of the Cooperative).

A prerequisite for the implementation of the above is that our Cooperative continues to exist. Unfortunately many members have not yet settled their debts with the Cooperative which now amount to a total of 849.342,00 €. Whatever the reason for this delay is, you should all know that nothing can be done if the Cooperative does not have the necessary funds to achieve its purpose.

In the interim period until the decision of the Council of State which approves definitely the Urban Planning Study of the residential complex and therefore of each plot, you all have to sort out your outstanding financial matters so that we can proceed to commission the application study. The current money balance of the Cooperative is not sufficient for the application study which is the precondition so that we can divide the plots and proceed with the infrastructure works.

Otherwise, the responsibility for not completing the project lies entirely on the Members and not the Direction.

After the completion of the works each shareholder will own a demarcated and buildable land plot of 495m² (another 500m² will be used as public space) in a residential complex that will provide all high standards services and facilities with sports fields, playgrounds, cycleway, roads, sewage treatment plant, pools, church, parking, green areas, department stores and many more.

Ladies and gentlemen, we would like to assure you that the money for the works is not much in order to get a buildable plot of 495m² in such an amazing residential complex.

Only after the completion of the application study we will be able to accurately estimate the cost of infrastructure works (roads, public lights, water supply and sanitation).

Many shareholders want, for their own reasons to sell their plots. There is no demand for each plot individually due to the crisis and exactly because the infrastructure works have not been done and each shareholder does not own a defined plot. Responding to our query our Legal Consultant Mr. Marazakis Manolis replied that the Cooperative cannot sell the property as a whole because there is no such provision in the statute. He also told us that each shareholder is obliged to respect the decisions of the majority of the Cooperative. This means that if the majority decides to proceed with the infrastructure works, then all shareholders must comply, otherwise the Cooperative has the right to oust them.

In our effort to satisfy the shareholders that expressed their will to sell the property as a whole, we will investigate if the statute can be altered and include this provision in the statute.

We would also like to draw your attention regarding the very existence of the Cooperative itself. The money left at the moment is 186.000,00 € including the 50.000,00 € from the sale of three stremmas (3.000m²) to the Cooperative of the Hellenic Telecommunications Organization (OTE) outside the approved complex, as we have reported in previous General Assemblies. If this stock is exhausted due to our operational costs and despite the fact that we have reduced them significantly, then the Cooperative will be forced to close without being able to define the fate of our land plots.

Based on the above we want to inform you that in fact there is only one solution which is the completion of infrastructure works and the distribution of buildable plots. However, in order to facilitate our members facing financial difficulties or no longer wishing to acquire buildable plots in our Cooperative, after the completion of the licensing procedure by the Council of State and the implementation of the application study, we can distribute the plots on paper by drawing so that each one knows which plot is his and thereby facilitate the sale of his plot.

Dear members, we want to let you know that as a Council going through the last quarter of its second three-year term, we have made efforts, we have travelled, we have spent hours, days and months to achieve the best result for everyone. Since the letter will be somehow a voting method in order to investigate the intentions of the majority of the shareholders, we urge you to choose with great responsibility one or the other proposal which will be the definite will of our members or write your suggestion as a comment.

You will have to reply in writing and signed if you agree with the 1^st proposal:

“I wish, after the completion of the Application Study to carry out the distribution of land plots and at the same time proceed with the implementation of infrastructure works (whichever way possible) so as to be able to emit building permits for each plot”.

If you agree with the 2^nd proposal:

“I wish for the Application Study to be completed and then proceed with the distribution of plots on paper, without this permitting however the emission of building permits and therefore the construction of buildings”.

We urge all Shareholders to send the questionnaire with their explicit answer by 20/03/2014 in order to be able to process the replies and announce the result in the next General Assembly during which we will take the final decisions on the future of the Cooperative. If you have changed address and/or phone number please inform us of your news details in the letter.

QUESTIONNAIRE

NAME………………………………………………………………………………

SURNAME…………………………………………………………………………

ADRESS……………………………………………………………………………

TEL: ........………………………………………………………………………….

E-MAIL...………….………………………………………………………………..

CIRCLE A FOR THE FIRST PROPOSAL OR B FOR THE SECOND PROPOSAL

A

I wish, after the completion of the Application Study to carry out the distribution of land plots and at the same time proceed with the implementation of infrastructure works (whichever way possible) so as to be able to emit building permits for each plot.

B

I wish for the Application Study to be completed and then proceed with the distribution of plots on paper (without this permitting however the emission of building permits and therefore the construction of buildings).

C

Write your suggestion:

Date ....../....../2014

Signature

PS. We kindly ask you to send this letter to: Str. 1770 no. 28, Postal code 71202, Heraklion - Crete