Dear Whitefish Shareholder, February 27, 2020
Historically, Whitefish the Club has tried to assist shareholders looking to sell their shares by matching them with new or prospective shareholders who have indicated an interest in purchasing shares in the Club. Over time, the number of sellers has grown at a rate that outpaced the number of willing buyers. To adapt to this change and to ensure fairness in the matching process, the Club has adopted a Limited Stock Redemption Program effective immediately. The Limited Stock Redemption Program will provide shareholders the option to request that the Club redeem their shares in exchange for either of the following options:
- One Golf Coupon for each share. Each Coupon will be good for one, 18-hole round of golf for the holder and one guest in the same tee group. Each Coupon will have three-day prior tee time rights and will be valid for a period of 3 years from issuance (some restrictions may apply); or
- $35 in cash paid to the shareholder for each share redeemed (subject to limitations described below)
Alternatively, you may also consider donating your shares to the Club. Setting aside funds to repurchase shares is very difficult for the Club. If some shareholders are willing to donate their shares when they no longer have use for them, this is extremely helpful. The Club, of course, is not a qualified non-profit organization, so we urge you to seek tax advice relating to your individual situation as you determine the tax benefits, if any, of a stock donation.
The Board intends to limit the dollar amount of cash redemptions under the Program to an amount equal to the dollar amount obtained from the sale of new shares of stock in the Club. We expect that cash redemptions will be conducted on a first come, first served basis, while adhering to the cash redemption limitations and annual redemption limits per shareholder. Once the cash redemption limit is reached, remaining names will be logged on a list awaiting additional redemption funds. Please note, the coupon option is not limited, nor would be any donations. The Board reserves the right to monitor, change, suspend, revoke or curtail this new redemption process at any time and for any reason, and will formally document the Redemption Program consistent with this letter.
The Limited Stock Redemption Program, and the redemption options outlined above, are based on the premise that our primary focus is to provide you with a quality golf club experience. Share ownership at the Club is primarily designed to allow shareholders access to golf course privileges at discounted prices and priority usage. The Board believes that it is in the best interests of the Club and its shareholders to prioritize the use of available financial resources for the betterment of the Club and the golf experience of those who play our course. That said, we do believe a Limited Stock Redemption Program that allows existing shareholders who no longer use or desire the benefits of stock ownership the option to obtain something of value for their shares. The $35 dollar cash redemption value is not intended to reflect the full value of the shares, as shareholders have hopefully realized significant value in club benefits prior to redemption. All shares redeemed by the Club will be cancelled.
We appreciate and understand the redemption options described above may not be attractive to everyone and no shareholder has any obligation to participate in this Program. However, the Board believes that there are individuals who can benefit from this program and that this change will allow the Club to move away for the current, outdated lottery system.
Regardless of the Board’s adoption of the Limited Stock Redemption Program, every shareholder continues to have the right to sell his or her shares to whomever he or she may choose, at any agreed-upon price. When this happens, the Club will assist with the proposed transfer as it has in the past. Also, it is important to note that the Club has not historically and will not in the future try to make a market for shares of stock in the Club in any way, and is not obligated to repurchase shares from shareholders who want to sell.
John McEnroe, President of the Board of Directors