2. 2013 Operating Units Bundling (Merger) Update

3. 2013 Operating Units
What is “bundling”
“Bundling” refers to the recreational facilities within a community being owned and operated by the POA
A Merger is the legal process of combining two Associations into one. In our case, Quail Ridge Country Club Inc. would merge with Quail Ridge Property Owners Inc..
The new entity will operate as one with a combined Board to be established as part of the merger.
Quail Ridge Condominium Association would continue to exist for Local Area Governance

4. History
Quail Ridge was originally designed as a Mandatory Membership club and community with two separate entities (Club and POA)
Once the Club and Community was turned over to the members by the developer, the residential unit owners became the owners of Quail Ridge
The unit owners delegated the management of the entities to Boards of these separate, independent corporations

5. We operate like a Bundled community without any of the benefits!
History
In 1991 the Boards realized that the divided governance and management resulted in conflict and created the Coordinating committee and a single management team Through Joint Organizational order #1
In 1998, both Boards adopted Joint Organizational order #3 further outlining and defining the role of the Coordinating committee
Effectively the Coordinating committee which consists of the four officers from each entity manage the community for at least six months out of each year
We operate like a Bundled community
without any of the benefits!

6. “Why” Merge the Club and POA?
2013 Operating Units
“Why” Merge the Club and POA?
Modernize our membership categories
Improve and simplify our Governance Model
Streamline our operations and reporting structure
Consolidate our Capital needs
Potential economic benefits associated with a merger

7. Proposed new Membership Categories (current social members are grandfathered)
Primary
Dues: = approx. 70% of Full
Limited to an initial cap
Split between current members downgrading and social members upgrading or new members.
Cap may be adjusted by Board Policy
Replaces current Social Membership
20 rounds of golf per year (per household)
Includes Fitness & Tennis privileges
Tournament play not allowed
Unlimited “off season” golf at 50% of the published guest fee
Intermediate
Dues: = approx. 85% of Full
Limited to an initial cap
Split between current members downgrading and social members upgrading or new members.
Cap may be adjusted by Board Policy
Limited golf privileges
40 rounds of golf per year (per household)
Includes Fitness & Tennis privileges
Includes Tournament play
Unlimited “off season” golf at 50% of the published guest fee
Full
FULL GOLF PRIVILEGES
UNLIMITED ROUNDS OF GOLF
ADVANCED TEE TIMES
INCLUDES FITNESS & TENNIS PRIVILEGES
PRIORITY SIGN UP FOR ALL TOURNAMENTS

8. Primary Downgrades Cap TBD Intermediate New Members Cap TBD
MEMBERSHIP LIFE CYCLE
Full Member
Intermediate Downgrades
Cap TBD
Primary Downgrades Cap TBD
Primary
New Members Cap TBD
Intermediate New Members Cap TBD
Social Members
Will be
Grandfathered

9. Proposed Membership Options
Upgrading
Current Social Members may upgrade without payment of an additional initiation fee on a one time only basis at the program inception.
All other categories may upgrade at any time from one category to another subject to availability and payment of applicable fees.
Dues will be prorated for the year of any upgrade and all subsequent years will be billed at the new category rate

10. Proposed Membership Options
Downgrading
At the inception, current Members may downgrade one or two classes based on availability
Upon successful completion of a Merger vote, Members will receive an “Expression of Interest” form to indicate their category of choice by June 30th 2019
Priority for downgrades will be based on the owners original joining date
After the initial cap is full, all downgrades will be based upon availability.
The Board will have the ability to modify caps based on the economic needs of the club and market conditions

11. Membership Options Legacy
Legacy
A child of a member can assume their parents' membership upon payment of 50% of the current initiation fee and successful completion of the membership approval process.
Parents remaining in the home can retain Non Golf related recreational amenity use privileges

12. Simplify our Governance Model
Our current structure is as follows:
Coordinating Committee
POA Board
POA Executive Committee
Condo Board
Club Board
Club Executive committee
Two finance committees
One POA committees (ARB)
Six Club Committees (Activities, Fitness, Golf, Green, House, Tennis)
Nine Joint Committees (Bundling, Bylaws, Conduct, Governmental Affairs, Insurance, Landscaping, Membership & Marketing, Long Range, Community Safety

13. Simplify our Governance Model
Governance model after a merger?
Quail Ridge Board
Quail Ridge Executive Committee
Quail Ridge Finance Committee
Seven Quail Ridge Committees (Fitness & Tennis, Golf &Green, House & Activities, Bylaws, Conduct, Membership & Marketing, Long Range)
Condominium Association Board (21 local areas)
One Condo Board Committee (ARB)
Two Joint Committees (Insurance & Safety, Landscaping)

14. Condominium board changes
The major changes included are:
The elimination of at large members
The Board will be called “Governors” instead of “Directors” in recognition of their position
The board will be comprised of the twenty one (21) local area governors
The condominium board will elect their independent officers at their organizational meeting following the annual meeting

15. Condominium board changes
The major changes included are:
The president of the Condominium board will have a seat on the POA/Club board
The new Bylaws includes term limits of six years for each Area Governor
The architectural review committee will report to this board (with the exception of POA owned property and amenities)
The landscaping and Insurance & community safety committee will act as joint committees to the merged POA/Club board and the Condominium board

16. Streamlining our Operating and Reporting Structure
Eliminates the Coordinating Committee (12 meetings per year)
Merges the Club Board with the POA Board (eliminates 6 meetings per year)
Creates one Executive Committee (eliminates 6 meetings per year)
Merges the Finance Committees (eliminates 6 meetings per year)
Merges several Committees (Golf & Greens, House & Activities, Insurance & Safety etc.) eliminating up to 24 meetings per year

17. Streamlining our Operating and Reporting Structure
Creates a single consolidated financial reporting structure for month and year end
Elimination of one audit and related tax returns
Consolidation of Checking accounts and elimination of dual checks from both entities to one vendor
Improves our billing and collection process

18. Consolidate our Capital needs
Currently all new property owners are required to pay two forms of Initiation fees (Club and POA)
Both entities also budget separately for their annual Capital needs
We anticipate moving to a single price Initiation fee that would include the Club and POA
The merged entity will be able to plan effectively for our entire community from one source of funds
This will create a balanced approach to planning capital for the recreational amenities and infrastructure needs

19. economic benefits associated with a merger
2013 Operating Units
economic benefits associated with a merger
The potential tax benefit is that all members currently pay sales tax on all of their club dues.
In a merged community where the club facilities are owned by the POA, unit owners are exempt from sales tax on the lowest level of membership required in the recreational amenities
The respective boards forecast savings and have redirected the related funds to membership plan implementation, debt reduction or future capital needs in the financial modeling

20. 2013 Operating Units Remaining Steps
HOST TOWN HALL MEETINGS FOR OPEN DISCUSSION 3/16/2019
FAQ’S PUBLISHED ON OUR WEBSITE
QRBUNDLING.COM
RECEIVED AUP FROM RSM, PENDING TAA FROM THE STATE
PROXY PACKAGE MAILED TO MEMBERSHIP 3/11/19
CALLED SPECIAL MEETING FOR MONDAY APRIL 8TH, 2019
WE ARE HERE

21. 2013 Operating Units Transition Period
Coordinating Committee will be Replaced by the Transition Committee effective April 8th
The Transition Committee will meet over the summer in the same way the Coordinating Committee has
The Transition Committee becomes the Transition Board October 1, 2019 until the annual meeting
At the Annual Meeting a new Board of Directors will be elected by the members
At the Organizing Meeting following the Annual Meeting, the Officers will be elected by the Board
A Nominating Committee will be elected to prepare a slate of Candidates for all Board positions

22. 2013 Operating Units Marketing – Bundling Microsite
QRBUNDLING.COM

23. 2013 Operating Units Marketing – Bundling Microsite
QRBUNDLING.COM

24. 2013 Operating Units Proxy and quorum importance
B 442, 2/3 yes
D 2/3 yes EA,
300, 50% + 1 (151)
474, 2/3 yes

25. 2013 Operating Units Merging the Club and POA Questions ?