The following questions were raised at a meeting of Tura members on 15 April 2010.  The meeting was chaired by Mike Channon (Captain, Men's Golf Club) and was attended by the presidents of the four internal clubs based at Tura.  The purpose of the meeting was to ensure Tura members had a common understanding of the proposed de-amalgamation process and to canvas any unresolved issues prior to the General Meeting on 19 April.  Responses from the board are included below.

1.  Will the Board make available to the OLGR, as soon as possible during the process, the information the Office needs in order to decide on the licence issues for the new Tura entity?  The speaker was concerned re huge amounts of time and energy which may be wasted if the Office denies the licences.

The application to OLGR can not be made until the new Tura Company is incorporated. The application to OLGR must come from the Board of the new company and can not be from the Board of MIBC Ltd.

Nominations for a steering committee of Tura sporting members will be called following Monday nights meeting if the resolutions are passed.  The Steering Committee will be responsible for the co-ordination and creation of a new Tura company (subject to Tura member approval) which will make the application to OLGR.  The Board of MIBC Ltd will provide whatever information and assistance it can to assist the Steering Committee and the Board of the new Tura Company with the application to OLGR.

2.  Is the Board aware of, and has it factored into its calculations, the mooted steep rises in electricity charges?

Any future increases in electricity cost will affect Tura whether amalgamated or de-amalgamated.  The Board of the company of the day, whether MIBC Ltd or the new Tura Company, would be responsible for meeting any costs through the usual business practices of adjusting fees, reducing other costs, increasing incomes or whatever method it deems appropriate.

3.  Can the Board explain the criteria it will use for selection of the Steering Committee?  There was a very strong view that Tura club members should appoint Steering Committee members.

The Board will only appoint committee members from the nominations received. If the number of nominations exceeds the number of positions, the Board will select the candidates which it believes have the best backgrounds and skills etc to assist the committee with its responsibilities in line with the Terms of Reference.  The Terms of Reference of the Steering Committee will be available at the time nominations are called.

4.  Whose decision was it that Lot 1442 becomes the property of MIBC?  Why should it not be retained by the new Tura entity?

The Board of MIBC Ltd purchased this land from a group of private investors in 2002.  TBCC Ltd had lost ownership of this land five years before amalgamation.  This piece of land has been retained by MIBC Ltd to offset the costs it will pay on behalf of both clubs to de-amalgamate and in recognition of the contribution MIBC Ltd made to the viability of Tura during the eight or so years of amalgamation.

5.  Will the Board enunciate and clarify the conditions of the loan to be extended to the new Tura entity?

An unsecured interest free loan of $100,000 will be provided to the new Tura Club repayable in equal monthly instalments over 50 months.

6.  Will the Board please confirm and explain its statement that, in the event that one or other of the two clubs becomes financially unviable, within the ten years following de-amalgamation, its assets will automatically pass to the other club?

Most, if not all, Registered Clubs have a standard clause in their Constitution relating to what happens to any remaining assets in the circumstances where the Club/Company is wound up or dissolved.  This is required because the Club/Company does not have shareholders to distribute these remaining assets to.

In most cases the constitution will stipulate the distribution of these assets is to be to a “like club” or similar.   The only difference with the MIBC/TBCC arrangement is this clause would make clear who the “like club” is to be.  Additionally, in the MIBC/TBCC case, the clause only relates to the first 10 years after de-amalgamation.

7.  What is the Board’s motive in agreeing to forgo ownership of the assets at Tura Beach, which were recently valued at 5.2 million dollars?

The Board’s motive is to provide the essential assets required for the Tura venue to operate viably as a stand alone operation whilst not impacting the assets required for the Merimbula venue to continue to operate viably.   The major component of the assets to be transferred is in freehold land and improvements. To provide less than is proposed may make Tura’s stand alone status less viable.

The written down value of the assets as per the company balance sheet is approximately $2.3mill. The most recent valuations undertaken by Caddey Searl Jarman for the Board (at 1 July 2009) suggest the current value of assets to be transferred could be in the vicinity of $3.3mill.

8.  Is the board aware of the prevailing unease that Tura members have, that they are being rushed into decision-making?  (The meeting was not satisfied with the answer to this question given in the 14 April document.)

The Board is following the process recommended by the solicitor.  There are many steps to be undertaken and approvals to be achieved before de-amalgamation can be operational.  The work to achieve de-amalgamation will be costly and time consuming and will divert company resources away from other issues. The Board is seeking a clear indication from the membership that it does share the Board’s view on the concept of separation before it redirects, and commits, significant company resources to this initiative.  The Board believes it is not rushing the process but more so, being prudent in seeking members’ view at this early stage. The approvals sought on Monday night are only effective if de-amalgamation ultimately proceeds following receipt of the other approvals required in the process.  These approvals on their own will not bind the company to de-amalgamation but without such approvals de-amalgamation as proposed by the Board can not proceed.

9.  Would the Board please clarify the point of no return for decision-making?

There are several more layers of approval required after Monday before de-amalgamation is finally approved.  Monday night’s ordinary resolutions, if passed, do not create a “point of no return”.   As a minimum all of the following approvals must be received before the “point of no return” is passed:

a.  a steering committee of Tura sporting members will be required to demonstrate the stand alone Tura club can be financially viable;

b.  the Office of Liquor, Gaming and Racing (OLGR/Authority) must approve the granting of a new Club licence which includes being satisfied that the new club will be financially viable;

c.  the members of the new Tura Club will be required to vote in favour of a constitution and incorporation of the new company;

d.  BVSC will be required to grant approval to the transfer of the crown lease; and

e.  after all these approvals/milestones are achieved, as part of a Supreme Court application, members of MIBC Ltd will be required to vote in favour of the finer detail of the arrangements, at a general meeting of members.

The point of no return is not passed until membership approvals, OLGR approval, and BVSC approval are all received, as outlined above.

10.  Can the Board confirm that the reason why the Monday vote on core/non-core assets is scheduled at this stage, is that ALL members may vote on it?  In this early stage of the process, is the core/non-core issue necessary?  Why could it not be dealt with later in the process?

The Board is following the solicitor’s advice regarding the best process. The Board felt it was prudent to seek a formal indication of members’ views on de-amalgamation as a first step in the approvals process, at this meeting.  At this stage of the process the only formal vote of members that can include both Merimbula and Tura sporting members as well as social members are the core/non-core and gaming machine transfer ordinary resolutions.  These resolutions could have been considered at a later date but the Board would not have had the opportunity to receive the formal view of all members to separation at this stage of the process.  Please also see the response to question 8 above.