MINUTES OF THE 85th AGM HELD ON SUNDAY 30th AUG 2015 NAROOMA GOLF CLUB LTD BLUEWATER ROOM 10:00

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1 Page 1 of 11 Present: MINUTES OF THE 85th AGM HELD ON SUNDAY 30th AUG 2015 NAROOMA GOLF CLUB LTD BLUEWATER ROOM 10:00 Board of Directors: G. Lanham Chair (President) J. Grant (Snr Vice President) P. Haynes (Jnr Vice President) P. Jones (Captain) W. Durnan (Vice-Captain) W. Baker (Director) J. Ryan (Director) General Manager: D. Connaughton Auditor: Simon Byrne (Kothes) The Chairman asked for past presidents in attendance today to be recognised by the members. Both Austin Hanna and Leonie Whelan stood and were recognised. The Chairman asked for current Life Members to stand and be recognised by the Members. Austin Hanna stood and was recognised. Members: 60 Full Golf and Life Members 2 Social Members Total 62 Apologies: Peter Kearney, Ralph & Marie Imberger, Frank & Maria Clarke, Ron Constable, Jan Boxsell, Pam Leonard, Mick Commins, Rod Holman, Mike & Jan Shevlin, Tony Cobcroft, Bob & Trish Bennett, Marlene & Tony Hunt. Moved: N. Lee Seconded: A. Thompson Carried PROCEEDINGS: Due to the time being 10am and a number of members still yet to register and sign in the

2 Page 2 of 11 meeting will commence shortly. The chairman opened the meeting at 10.11am and welcomed those in attendance. He also introduced the committee and the Clubs Auditor Mr Simon Byrne from Kothes Accountants. The Chairman gave a brief opening statement: I do not intend to take this opportunity to repeat what I have said in my annual report however, I would like to thank the Board of Directors and the CEO for their dedication and hard work throughout the past 12 months. The loss and subsequent rebuild of both bridges on our course was taxing and time consuming, however, everyone worked as a well-oiled team to achieve the results that we did. I would also like to thank Peter James for giving his time and efforts during his seconded to our Bridge subcommittee. Although we experienced a downturn in revenue for the year, the Board and our CEO made a number of hard decisions to reduce costs that saved us from a really disastrous year. I would also like to say that things are looking more positive for the start of the 2015/16 year and we will be working just as hard to make sure that our club remains prosperous for the future. ITEM 1 1. To confirm the minutes of the previous Annual General Meeting held on Sunday 24th August (Minutes were available on the club website, front office and at today s meeting for members to read) Moved: R. Sayers Seconded: L. Gibbons Carried ITEM 2 2. To receive and consider the Directors Reports and Directors Statements. President mentioned that the reports have been circularised to members in the Clubs Annual report. Moved: N. Lee Seconded: L. Whelan Carried ITEM 3 3. To receive and consider the Financial Statements and the Independent Audit Report to the members. The Clubs Auditor Mr Simon Byrne from Kothes accounting associates was invited to give a brief report. Simon apologised that John Hukins could not attend the meeting today and that he would be presenting the financial statements on his behalf.

3 Page 3 of 11 Simon said that the club has made a modest surplus of $6,500 which included two one of items as listed in the report. It has been a difficult year with both the bridges having a major impact on the day to day operations of the club and the increased competiveness of clubs in the area. Simon mentioned that due to these occurrences the three (3) main trading areas of the gaming, bar and golf receipts were less than the previous year. The result could have a lot worse if it wasn t for the board and management action in controlling cost with the main one being a decrease in wage expense of approx $30,000. Administration cost was also well contained. Simon explained the importance of the EBITDA % which is the benchmark in the club industry on how a club is operating financially. While this club is low and needs to be addressed in the short term he was pleased to report that the audit completion letter only had minor matters to be addressed. Simon also mentioned that the club industry as whole across NSW including some local clubs are also doing it very tough due to RSA, RCG, new smoking laws, internet gaming and decreasing gaming revenues. The club has plenty of challenges ahead and it is pleasing to see that the unaudited accounts so far for this financial year are well ahead of last year and budget. Simon asked members present if there were any questions regarding the financial figures. N Robertson asked about the clubs current EBITDA % and how that compares to similar Clubs in NSW. The Club auditor explained and mentioned that 2/3 of clubs have an EBITDA under 10% and are in the financial risk category. He also mentioned that the clubs EBITDA % was 7.5% which was also in the dangerous category however the problems experienced by the club from the replacement of two bridges and the increased competitive nature of similar clubs in the area has affected this dramatically. No reason that all going well the club can t reach over the 10% mark this financial year considering the good start for the first quarter. The Chairman then handed the mic to the Acting Treasurer, Mr Phil Haynes for his report. Thank you for your attendance at our AGM this morning. I just want to take 5 minutes to run through all things financial that occurred during our financial year and more recently. Some of this information has been covered off in my report in the annual accounts so apologies to those who may have already read this. The ongoing financial viability and sustainability of our club is paramount to our future survival and success and importantly you as members need to be kept abreast of our ongoing position. As you are all well aware, we had 2 bridge outages this year to contend with, one of which was covered through an insurance claim and the other left to the club s board and appointed committee to deal with. Initial construction cost quotes for the 8 th bridge ranged from between $200,000 to nearly $400,000. The final bill, including permit fees, engineering, legal fees has come in at $130,000. The net cost to the club was $100,000 with $30,000 raised through raffles, event nights (that less than 5% of full playing members

4 Page 4 of 11 attended might I add) and direct donations from some very generous members. I would again like to thank committee members, Dominic, Peter James and our appointed engineer Jeff Lean for their tireless efforts in getting the best outcome for the club. I would also like to thank those members and their families who over 9 months, 7 days a week taxied carts up and down for the benefit of their fellow members and guests. From a financial point of view the bridge issues did have a detrimental impact on our trading performance, both directly and indirectly. In a direct way we have incurred additional costs by way of: - Cart hire - $21,000 - on course electricity costs for charging of the carts - $7,000 - Cart repairs and maintenance - $2,000 And we have lost revenue by way of: - Social green fees were down $24,000 (inability to play 18 holes deterred social play) - Cart income as a result of the above was also down $17,000 It is the indirect revenue loss though that it is hard to quantify, with less patronage of the club as a result of the inability to play 18 holes. We cannot assign the blame entirely to the bridge issues, as we also face a very competitive and perhaps ruthless landscape for patronage, but there is no doubt it has contributed. In total, we estimate that the bridge outages and associated issues cost the club in excess of $100,000 in bottom line income during the 2014 / 2015 year. The board and management team anticipating the financial impact of the bridge outages were very pro-active in addressing costs and reviewing revenue lines. So much so that I am pleased to report that after the first 3 months of trade in the new financial year, we are $70,000 ahead of where we were at the same time last year. This is almost entirely due to better cost control. Our long-term debt continues to amortise, with principal repayments increased to $15k per month in May this year. As a result a further $60k has been paid off our long term debt since the start of the new financial year and is now below $1.4mio for the first time in many years. In fact it currently stands at $1.37mio. We have locked in interest rates on a large portion of the debt to protect the club from future interest rate rises. The board is determined to reduce our borrowings and the strategy is such that total borrowings will continue to decline year on year. The board is however, also conscious of the need to re-invest back into the business and balance the needs of the course and Club house. To this end a comprehensive plant & equipment register has been established for the Club house and Course and through this we have developed a capital expenditure / asset replacement program in terms of the timing and priority of their replacement. This program has already begun with the purchase of the following items over the last 12 months: New Rough Cut Mower New Pro Force Blower New Grass Edger New Hi-Pressure Cleaner Second hand Verti-Drain or corer

5 Page 5 of 11 New Gaming Room Stools 110 function chairs and 25 tables New Spray Unit and trickster that should arrive this week just in time for spring New Sand-pro Bunker Machine A new 40KW solar electricity system will also be installed this week and will save the club up to $12,000 in electricity costs per annum The re-investment also takes the shape of a capital works program, some of those works include: Installation of new sliding doors at the front entrance New cart apron and wedding path A roof over the club side entrance The new Alfresco Gaming Area The 8 th & 10 th bridge replacements The storage shed and cementing of paths including the more recently completed path from the 8 th tee to the bridge. All of these items mentioned amount to $408,000 of total investment over the last 12 months, which is over and above general expenditure, and repairs and maintenance expenditure on club and course. $303,000 of which was financed through cashflow including the bridge with only $105,000 borrowed externally for some of the course equipment mentioned. Ongoing investment is still required in many areas to improve the course and club house facilities while continuing to amortise our debt down to a more manageable level. We don t just want to exist as a club we want to thrive. We have been in survival mode for a number of years now and whilst we haven t turned the corner just yet, the current board is determined to get us there. The board certainly has its role to play in this endeavour, but so do you as members by understanding that the success of the club will ultimately depend on your support of your club through patronage and other means. In an open letter to the community in the Merimbula Newspaper last week, the heading read Clubs in Merimbula Do they have a future. It talked about the hard facts facing sporting and other clubs in regional NSW. For golf clubs particularly it stated that there had been no real influx of golfers under the age of 50 in the last 16 years and clubs more generally are continuing to close and/or amalgamate at a significant rate for financial reasons. The CEO of clubs NSW is expecting to see a drop in the number of clubs by up to 23% over the next 10 years which is the equivalent of almost 300 clubs. This is on top of the 400 clubs that have already closed their doors in the last 10 years. The article stated that Merimbula clubs were not immune from such financial pressures and that in fact all 3 clubs are either experiencing, or expecting to experience financial stress now or in the near future. A quote from the article reads Waiting to see who fails and whether the remaining clubs can get a windfall outcome as a result, ignores the reason for having a club; it is not to build the biggest and best castle but to serve our community and to ensure services and support can exist and grow into the future. I m sure no one here is of the view that holding a badge draws 4 nights a week serves the best interest of our community and ensures that we all exist and thrive into the future. Remember this is your club and your support is imperative to its future success.

6 Page 6 of 11 Lastly, I would like to thank all our volunteers, whose contribution is immense and often goes un-noticed, they are the heart and soul of our club. Moved: J. Gately Seconded: A. Thompson Carried Item 4 4. To decide the following resolutions by the Board of Directors: That pursuant to the Registered Clubs Act 1976; (a) Members approve expenditure by the Club not to exceed $7, for professional development and education of Directors during the 2014/15 financial year of the Club, details of any such expenditure to be made available to the members at the next Annual General Meeting of the Club. (Expenditure for 2014/15 was $640.00). Moved: C. Eardley Seconded: R. Sayers Carried (b) Members approve expenditure by the Club not to exceed $5, for meals and refreshments by Directors when carrying out their duties or when entertaining guests of interest to the Club during the 2014/15 financial year of the Club, details of any such expenditure to be made available to the members at the next Annual General Meeting of the Club. (Expenditure for 2014/15 was $2,631). Moved: N. Lee Seconded: L. Holmes Carried (c) Members to approve reimbursements for directors for minor out of pocket expenses incurred in carrying out their duties for the club during the past year being $2000 for the President and Captain and $1500 for each other Director. Moved: D. Landells Seconded: R. Sayers Carried (d) Members acknowledge that the benefits in paragraph 4(a), 4(b) and 4(c) are not available to members generally but to Directors only. ITEM 5 5. To consider and vote on a Special Resolution to adopt an updated constitution for the club. The Chairman said that only Life Members and Full Golf Members are eligible to vote on this special resolution. Voting will be done by a show of hands with the Orange card that was given to you when you registered earlier today. To pass the special resolution we require a 75% majority.

7 Page 7 of 11 The Special Resolution for the update of our Constitution was attached to the members notice sent out recently so everyone here should have a copy. If not, a copy is available from Tracey at the register desk if required. Moved: J. Gately Seconded: A. Hanna Carried ITEM 6 6. To consider and vote on an Ordinary Resolution for life membership for Pam Leonard membership number 324. The Chairman advised the meeting that all categories of membership are entitled to vote except club employees which will be carried out by a show of hands. To pass the Ordinary Resolution we require 50% + 1. The Chairman called on Lorraine McCarthy to move and speak on behalf of the resolution. Lorraine mentioned that in recent times we have lost our lady life members due to their passing and this has prompted the ladies to seek out support for the inclusion of a new lady member to become a life member. The club currently has 6 male life members. The Board has endorsed the life member s nomination of Pam Leonard. We are aware and most certainly agree that life membership is a privilege for those that are worthy of receiving such an honour and it goes without saying that it is not something that should be awarded just for the sake of doing so. It should and always does go to someone who has been an exemplary member over a long period of time and has the supported and upheld the good name of our club throughout. Pam Leonard, who is a much loved and respected member of our golfing fraternity has been a member of the Narooma Golf Club for some 55yrs joining with her husband not long after they were married. Over the years Pam has supported the ladies golf of our club by participating on the ladies golf committee and has held every position except for treasurer. Pam has also been a delegate on the South Coast Tablelands Golf Association, our peak body for the region and being rules accredited. Pam has been the go to person on many occasions to sort out the numerous rules, clarifications that arise within our golf events. Pam has participated on the greens committee for our course and has been an arid supporter of the revue and themes dinner evening and has been a team player for the betterment of ladies golf as a whole.

8 Page 8 of 11 The chairman supported the resolution and said that Pam Lenard is a worthy recipient for a life membership of the club. Moved: L. McCarthy Seconded: A. McMillan Carried ITEM 7 7. To deal with Notices of Motion for which due notice has been given. The only matter received within the stipulated timeframe was an from Angie McMillan. I would like to point out that this is a question from Angie and not a motion. The question from Angie reads as follows: Why have we not asked for a nomination for the Board for treasurer? Our Constitution states that it is a position for the Board and I find it amazing that we have bypassed this. If the Constitution states that we have a Treasurer then we should have one. It is not good enough for a Board member to hold 2 positions as has been the case this year. This position is vital for the financial direction of the Club and for the accountability of decisions that are made of a financial nature that the Club undertakes. I would think that this position needs to be filled as a priority and if not open for nominations prior to the Agm it should be opened to the floor on the day so the membership can vote. I look forward to the response on the day so members can have input. The Chairman replied by saying that Phil Haynes is the Junior Vice President as appointed by the members. It was decided by the Board, given Phil s obvious knowledge, qualifications and expertise, that he should chair the Finance and Audit Committee meetings. This decision has in fact improved the quality and standard of financial reporting required of this position, not diminished or reduced it. Members vote and put Directors in place to make decisions on their behalf and the Board made a decision (at the Board meeting in May 2015) to have Phil chair the Finance and Audit Committee and as such to act, for want of a better word, in the position as honorary Treasurer. No rules were breached under the Constitution or the Registered Clubs Act 1979 in this decision making process. The decision made was done in the best interest of the club and its members. Rules 74 and 83 of our Constitution allow the Board to appoint a person to a casual vacancy in certain circumstances: Rule 74: Notwithstanding any vacancy on the Board the members of the Board for the time being may act as the Board but if at any time there is a vacancy in the numbers of the Board which results in the members of the Board being fewer than seven (7) the Board shall within three (3) months after the vacancy occurs appoint an eligible person to the Board to ensure that there are at least seven members of the Board. Rule 83: The continuing members of the board may act notwithstanding any vacancy in the Board, but if and so long as their number is reduced below the number fixed by or

9 Page 9 of 11 pursuant to these Rules as the necessary quorum of the Board, the continuing member or members may act for the purpose of increasing the number of members of the Board to that number or of summoning a general meeting of the Club but for no other purpose. Rule 62: The business affairs of the club and the custody and control of its funds shall be managed by a board of Directors consisting of up to nine (9) Directors. The board must comprise a President, a Senior Vice President, a Captain, a Vice Captain, a Junior Vice Captain and Honorary Treasurer and may have three other ordinary Board members. Rule 62 states how the board will be comprised. The Constitution does not state that the Honorary Treasurer has to chair the Finance Meetings or any other meetings for that matter. All Directors are equally responsible regardless of their title or what sub-committee or meeting they may chair. We sought legal advice from Pigot Stinson Lawyers, the legalists who actually wrote our Constitution and presented the Triennial Rule to this Club. Pigot and Stinson advised that we, the Board, did not breach or contravene the constitution or any Act in our decision to make the Junior Vice President Phil Haynes the chair of our Finance and Audit Committee and acting Treasurer. The Board intends to vote at the first available Board meeting following this AGM in an endeavour to fill the Honorary Treasurer s position and if, for argument sake Phil Haynes is selected and agrees to fill this position, then his position of Junior Vice President will become vacant and the Board will have to deal with that matter. At the end of the day we still have more than the required 7 directors as stated in Rule 74, so any vacancies that arise will become a matter for the Board to deal with. I trust that this answers your question. Angie asked at what point do we end up with a full board. The Chairman explained that depending on what happens at the first Board meeting after today it should be at the AGM in There were no further questions on this matter and it appeared that the members agreed with the Boards action. ITEM 8 8. To elect the Board of Directors for the ensuing year in accordance with the clubs constitution. The chairman invited the returning officer Mr Joe Gately to announce the results for the director s positions for the 2015/16 year. The returning officer thanked the General Manager and the office staff for their assistance in preparing the documents required for today and to the scrutineers. Results are:

10 Page 10 of 11 Club Captain: Mr Peter Jones 3yrs (unopposed) Senior Vice President: Mr Peter James 3yrs Director: Mr Chris Eardley 3yrs The chairman thanked Mr Gately and congratulated those elected. He also thanked the candidates who stood and were unsuccessful. I wish to congratulate Peter Jones, Peter James and Chris Eardley on their appointments and welcome to the Board. The first board meeting will be tomorrow. I wish to also extend my commiserations to bodgie, he gives it his all around this place and I hope you keep trying as I think you will make it, we thank you for what you do for this club. On behalf of all members, management and staff and your fellow board members, I wish to also extend a very sincere thanks for the commitment and dedication of the two retiring board members, Joe Ryan and Jim Grant. Senior Vice President Jim Grant dedicated 3 plus years of hard work and commitment to the Board and Director Joe Ryan dedicated 6 plus years of hard work and commitment to the board. It is no easy task being a Director for pats on the back are few and far between. However, despite these down sides, it is an important role and one that both Joe and Jim have undertaken professionally and honourably on your behalf. Again, on behalf of the members, club management, staff and your fellow directors, we wish you a sincere thankyou and all the very best for the future. I would also like to thank Peter Jones who decided to re-nominate for the Captains position that he has held for the past 10 plus years. Peter, you are a remarkable person and thank you. ITEM 9 9. Recommendations to incoming board. The Chairman said that this is not an opportunity to put forward motions or to argue or discuss any issues. It is for recommendations only to the new incoming Board. A. Thompson asked if the Board could look at some form of transition for the Captains Position over the next 3yrs so he may have a rest or hand the positon over. K. Ryan asked what action does the board intend taking regarding the recent article on the Pinerivers Golf Club private golf cart owners holding approved medical certificates not having to pay a fee to use their golf cart for 18 holes of golf. The General Manger explained the clubs position on this matter in detail and mentioned the club was currently pursuing this matter with the anti-discrimination board of NSW and Golf NSW. T. O Callaghan asked in consideration of the high percentage of clubs in trouble financially across NSW if more can be done with our local politicians in regards to tax relieve.

11 Page 11 of 11 The General Manager gave a brief answer mentioning that the club has a good relationship with both the current local state member and federal member who have assisted the club on a number of issues including assistance with the 8 th bridge. P. Haynes also mentioned that we were negotiating with Eurobodalla Shire Council in regards to rent relieve. N. Robertson asked if the club can pursue council for the repairs of the 8 th bridge as being the landlord they have a responsibility. The Chairman said that the club had sought legal advice on this matter and without going into too much detail unfortunately the council are not responsible for the bridge replacement due to the bridges not being on the lease however, council have assisted the club by submitting co-joint submission in emergency funding with the department of primary industries. Due to time constraints on this matter the board had an obligation to its members to get the bridge back into operation and a decision had to be made to move forward and get the job done. It was also mentioned that the members themselves can assistant by supporting the club more where possible. R. Sayers said that the club has had a bugger of a year with both bridges having to be replaced in the same financial year and would like to thank the board and management for all the hard work carried out due to these issues and to come out into the black is fantastic and on my behalf thank you for making good decisions for the members you can continue to do so, thank you. T. Owens said in relation to private golf cart owner s fees which jumped up 66% this financial year that he was told by one director the increase was for the bridge costs and another director said it wasn t. What is the increase really for? The chairman said the increases are for the entire club and not specifically for any one thing or purpose. Costs go up annually and the board and management have to make decisions on these costs and how they will be paid for. Fees were increased across the board not just private golf cart fees. Hopefully fees can be maintained at the acceptable level they are for a few more years. Michael Wuttke-Hayes on behalf of the members wanted to thank the New Course Superintendent for the good job and the many changes to the course in the short time he has been here since his commencement with the club. The Chairman closed the meeting at 11.17am and invited members present for a beverage and a few nibbles.