Club Business

(although no board member attached their name to this email presumably it is from Gary Baum).

Dear Member,

Thank you to everyone who attended the Open Session Today and on Monday. Thank you also to everyone who has submitted questions and comments to us.

We have heard your comments and listened to your questions. Earlier today the Board of Directors and the Directors-elect held a special meeting to review your feedback and vote on a few initiatives. As a result, we have some updates concerning the Capital Investment Plan that we’d like to share that were approved unanimously by the Board and had support by the Board-elect members as well.

1. We plan to offer a third Open Session dedicated to Questions and Answers on Thursday, January 19th at 3 PM in the Clubhouse and online via Zoom. Zoom details below.

a. In the meantime, we will be launching a webpage by Friday, January 13th with all the Q&As.

2. A Special Meeting will be called for February 17th at 3 PM in the Clubhouse Boardroom

a. The required Notice of Special Meeting to conduct the vote on these five Capital Investment Plan projects will be sent on Thursday, January 19th. Six days later than we originally anticipated. The Notice will include a ballot for you to submit your vote electronically as we have described in the materials we have distributed.

b. The date of record will coincide with the Notice of Special Meeting on Thursday, January 19th. Only members in good standing can vote.

c. In the case of a Special Meeting, votes can be submitted electronically in advance of the Meeting and therefore you DO NOT have to attend in person, although you may turn in your ballot at the Special Meeting if you choose.

d. This gives members 42 days since we distributed the materials to consider the projects, ask questions, and submit their vote.

3. Membership was very clear on their request to have a methodology that would allow new members who join after the approval of the Capital Investment Plan to contribute to the Plan since they will benefit. It was suggested that part of the new member’s initiation fee, or the increased sale price of the Haig Point lot, could go to offset existing members costs for this Plan. While this seems reasonable there are barriers to doing it for all new members, particularly those who purchase property from an existing Haig Point member. The two primary barriers are:

· Approximately 50% or more of new memberships on resale transactions require a 75% to 100% refund to the exiting member. This means that Haig Point could potentially lose a considerable amount of money in this transaction if all or part of the Initiation Fee were used from these transactions, especially when refunds were due to exiting members.

· Using the difference in the increased value of Haig Point owned lots is not possible because in almost all cases it is a negotiation and it would be difficult to determine what that differential is, especially if there are incentives attached to close the sale.

With that said, we do believe there is an opportunity to do it with Initiation Fees associated with the sale of Haig Point owned lots because there are no refunds involved. We also believe that the proposed plan could be used for new National Members and new Non-Equity Non- Property memberships with minimal risks to compromising the 2023 budget.

Therefore, we propose starting immediately upon the approval of all three major parts of the Capital Investment Plan (golf course, roads and docks) and continuing until the three major projects are finished that we take 50% of all membership initiation fees paid on Haig Point-owned lots and new non-Equity/National members will be put into a restricted reserve account to be used for future road improvements.

We believe this allows a methodology to have all “net” new members contribute to the Capital Investment Plan, and it sets the stage for achieving the Board’s long-time goal of using Development (HP lot sales, Initiation Fees and excess cash flow) to build reserves for use in emergencies and capital projects.

Thank you, The Board of Directors