Harbour Town Yacht Club, Inc

HARBOUR TOWN YACHT CLUB, INC. BOARD OF GOVERNORS September 23, 2013

The Board of Governors meeting was held on Monday, September 23, 2013. The Board met in Executive Session at 9:00AM. The Club Group Ltd. Management Team joined the Board at 10:35AM. The meeting was called to order by Charlie Dorton, Commodore.

ROLL CALL

PRESENT: Charlie Dorton, Commodore Jack Purcell, Vice Commodore Beverly McKinney, Board Member Tim Ballinger, Treasurer Tom Bosley, Secretary Dudley Parker, Board Member Larry Wilson, Board Member

STAFF PRESENT: Mark King, President, CGL Brian Little, GM, CGL Andy Sutton, Controller

The Board reviewed the June 24th meeting minutes. Three adjustments to the meeting minutes were made and are in bold font:

A motion was made and seconded authorizing an Amendment to the Articles to change the corporate name of the Club. The motion was passed unanimously.

A motion was made and seconded to register The Club at Harbour Town with the State of South Carolina. The estimated cost will be around $600. The motion was passed unanimously.

Brian reported to the Board answers to the four questions they had regarding American Micro Solar. A motion was made and seconded to approve the solar water heating project using American Micro Solar. Brian is to request that the company lower the upfront cost of $42,000 down to $27,000 with the remaining balance being paid with the electrical savings each month. The motion was passed unanimously.

A motion was made and seconded to approve the June 24th meeting minutes as amended. The motion was passed unanimously. FINANCIAL – ANDY SUTTON & BRIAN LITTLE

Andy gave an overview of the balance sheet as of August 31st, 2013. Cash is up over $41,000 from 8/31/12 to 8/31/13. This is due in part to the increase in pre-paid membership dues as well as reserves that have yet to be used on capital projects.

Total receivables (1100 to 1399) are extremely low at $263,194 due to the collection efforts, which has attributed to improved cash flow.

Andy explained the Statement of Cash Flows.

Brian reported that the variance to budget on G&A department 910 was due to $10,000 of the initiation proceeds going towards covering delinquent memberships. The Club has spent $7,000 more than expected on legal fees for foreclosed memberships.

Lodging is $10,000 less than budgeted due to more members selecting a departure clean instead of daily housekeeping ($6,000). Also, Credit card discounts are over budget by $4,000 due to members paying their pre-paid dues by credit card as opposed to a check.

F&B is ahead of budget YTD, due to an increase in group business this year.

Housekeeping is $5,000 behind budget as the department used more casual labor than normal to cover the loss of Frankie in March, who went out on disability from a car accident.

The Mystique is ahead of budget by $5,000.

The front desk is ahead of budget by $3,000.

The only reserve items remaining for the year are the Solar project, the fascia boards on the roof and a replacement of an air conditioner for the clubroom, totaling $20,000.

SALES REPORT – MARK KING

A total of 6 Equity membership re-sales have been sold this year for an average of $18,167.

We’ve had 70 to 75 discovery packages experience the Club of which two wound up purchasing a membership.

Four Social memberships have been sold year-to-date and there are currently 15 Social memberships available for re-sale.

A marketing piece will be mailed to 1,500 Sea Pines Property Owners in October.

OTHER Andy gave an update on the collections process from the eight or so members who are over 120 days delinquent. He recommended a collection agency that has worked quite nicely for the Swallowtail and Spicebush properties. A motion was made, seconded and unanimously approved to use the collection agency.

Brian presented the 2014 major budget assumptions. There was discussion regarding the percentage increase for employee health insurance. There was also discussion on the percentage that the Club’s property and liability insurance will increase.

Once the millage rate is released, The Club plans on appealing the initial appraisal as it has increased 15%.

The board discussed the benefits or refinancing the debt service for the Ameris Bank loan from the remodel in 2011. Andy will contact a number of banks to research current interest rates. The Board will write an RFP and once completed Tim will share it with Andy.

A motion was made seconded and unanimously approved to increase equity membership dues by $250 annually in 2014 and $250 annually in 2015.

Brian presented the 2014 Capital Reserve Budget

Charlie requested that Brian e-mail him the major capital projects that were completed in the last three years at the Club.

Mark presented the list of Action Items.

Brian presented a dress code for the clubroom at the Boards request.

The Board reviewed the November 4th, 2013 Annual Meeting package.

The Board discussed a letter in response to equity member Kerry Myrick’s e-mail regarding the possible name change.

Brian presented the Social Calendar for 2014.

Jack stressed the importance of drafting a letter to local GM’s offering their members a 2 night / 3 day stay at the club, which would include dinner as well. This would be offered during the slowest occupied months of the year: November, December, January and February.

Brian explained his meeting with Interval International and the fact that we may be able to rent room nights to interval members in the winter months to generate additional revenue.

Brian updated the Board on the solar water heating project and reviewed the new website.

RECOVERY UPDATE: - MARK KING With no further business, the meeting adjourned at 1:40pm.

FUTURE MEETINGS: Sunday, November 3rd, 2013 2PM Calibogue Room Monday, November 4th, 2013 9AM Clubroom