THIS MEMORANDUM OF UNDERSTANDING is entered into on the

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THIS MEMORANDUM OF UNDERSTANDING is entered into on the Powered By Docstoc
					THIS MEMORANDUM OF UNDERSTANDING is entered into on the Twenty-eighth day of February
2005


BETWEEN

                WHITE CITY TENNIS CLUB LIMITED [ABN 26 000 467 513] of Level, 30 Alma
                Street, Paddington, New South Wales ("WCTC")


AND

               JOHN ALEXANDER'S CLUBS PTY LTD [ABN 15 097 896 109] of Suite 442, Level
               4, 311 Castlereagh Street, Sydney, New South Wales ("JACS")

to record the understanding that exists between the Parties in relation to the matters herein
described.


1.     Preamble

1.1    WCTC has for many years conducted a tennis club on the Land and wishes to continue
       to provide its members with the facilities of such a club enhanced and enlarged as
       described in this MOU thereby perpetuating the sport of tennis at White City.

1.2    The Land is owned by Tennis NSW ("TNSW") which has leased part of a building erected on
       it to WCTC.

1.3    TNSW appointed WCTC to manage day to day tennis activities, conduct tennis operations
       and maintain specified grounds and buildings on the Land.

1.4    WCTC had an option to purchase part of the Land but such option has now expired.

1.5    JACS has the expertise and ability to construct, erect and operate world class sporting,
       health, fitness, racquet sports and social clubs and wishes to construct, erect and operate such
       a club in the Land or on part of it.

1.6    The Parties have been working cooperatively to formulate a commercial proposal to achieve
       the aims set out in sub-paragraphs 1.1 and 1.5 hereof.


1.7    JACS has been negotiating with TNSW for the purchase, or for the grant of an option to
       purchase, the Land by an entity to be established as hereinafter described and to be
       known as "White City Holdings Limited" (WCH). TNSW have advised JACS they now
       propose to offer the land for sa e by tender (the tender").
1.8    JACS is negotiating with a third party ("the third party") with a view to entering into an
       agreement with the third party to include terms whereby:

       1.8.1 the third party and JACS prepare and lodge the tender for the purchase of the Land
                 which will provide for the Land to be purchased by the third party;

       1.8.2 the third party grants to JACS on behalf of WCH an option to purchase part of the
                 Land ("the option from the third party") within a period ("the option
                 period").


1.9    In February 2004 JACS submitted to WCTC a proposal ("the Proposal") a copy of which is
       Attachment "A" hereto, which proposal was considered by the directors of WCTC at a
       meeting on 26 February 2004 and was the subject of a discussion between representatives
       of the parties on 23 April 2004.

1.10   At an extraordinary general meeting of the members of WCTC held on 16 June 2004
       ("the EGM") such members passed two ordinary resolutions, including the First Ordinary
       Resolution ("the First Resolution") the terms of which are set out in the Notice of
       Extraordinary General Meeting, a copy of which is Attachment "B" hereto.

1.11   Since the EGM the Parties have worked on the development of the details of the Proposal,
       the proposed structure of the legal and commercial agreements and arrangements
       between the Parties, and between the Parties and other entities, and between such other
       entities, and other matters required to give effect to the First Resolution.

1.12   Such development has now reached a stage where the Parties are able to enter into this
       MOU as an agreement of the kind contemplated by the First Resolution.


2.1    Interpretation

       In this MOU, in addition to words and expressions defined in the text, the following
       words and expressions shall have the meanings set out next to them:

       "the Approvals"        the development and other approvals referred to in paragraph
                              6.1(c) hereof


       "the Club"             the sporting, health, fitness, tennis, racquet sports and social club,
                              the development, construction and operation of which is contemplated
                              by this MOU.
      "Foundation          any person who was at 31 July 2004, and remains at the
      member"              date of the establishment of the Club, a member of WCTC and who
                            becomes a member of the Club


      "the Land"           the land described in Schedule 1 hereto

      "WCH"                White City Holdings Limited

      "MOU"                this Memorandum of Understanding


      "Parties"            WCTC and JACS

      "the Project"        the whole of the formulation, organisation and establishment of the
                           necessary      entities,    structures   and   agreements   and   of    the
                           development, construction and operation of the Club as contemplated by
                           this MOU

      "the New Club"       the new tennis club to be incorporated to replace WCTC and provide
                           an organisation for conducting traditional WCTC activities

      "JAWCC"              the principal operating company for the project which is yet to be
                           incorporated and which is to enter into the Entitlements Agreement
                           with the New Club to enable the New Club to conduct traditional
                           WCTC activities.


      "Establishment       the agreement between JAWC and WCH and JACS specifying
       Agreement"          JACS duties and obligations regarding the Project


      "Entitlements        the agreement between the New Club and JAWCC
       Agreement"          by which JAWCC will provide to members of the New Club
                           for the duration of the Lease, facilities for traditional WCTC
                            activities.


      "Operating           the agreement between WHC and JACS
      Agreement"           specifying the rights and responsibilities          of   JAWCC    for   the
                            management of the Club


2.2   Further:

      (a)   the headings are for assistance only and do not alter, qualify or regulate the
            interpretation of the text of this MOU;


                                                MOU VER 9
      (b)     if WCH purchases part only of the Land, the expression "the Land" shall thereafter
              mean such part of the Land as has been purchased by WCH.

      (c)     JACS hereby agrees the covenants on its part set out in this agreement apply to
              any subsidiary of )ACS and any entity controlled by JACS.

      (d)     JACS agrees its rights under this agreement are not assignable without the prior
              written consent of WCTC which consent shall not unreasonably be withheld.


3.    General Principles

3.1   Each of the Parties will use its best endeavours to bring the Project to fruition and will do all
      things in its power reasonably necessary to do so.

3.2   The Parties will work together reasonably and in good faith to bring the Project to fruition.

3.3   WCTC has agreed that until 31 July 2006, it will not enter into any discussions,
      negotiations, understandings, arrangements or agreements with any person, firm,
      company or organisation other than JACS, or as otherwise permitted by this MOU,
      concerning the purchase or use of the Land or any part of it, the development of
      the Land or any part of it, or the construction or operation of any club or sporting facility on
      the Land or any part of it. This provision shall cease to apply if, prior to the 31st July 2006
      TNSW enters into a binding contract of sale to sell the land to some party other than WCH
      and/or the third party referred to in Clause 1.8 herein.

3.4   Each party will keep the other fully informed of all progress in the Project including
      but not limited to the negotiations for, or the tendering for the purchase of the Land and the
      acquisition of the Approvals.

3.5   The Parties acknowledge that it is fundamental to the Proposal and to the Project that
      Foundation Members will obtain at least the following benefits and entitlements from
      the implementation of the Proposal and the Project ("the Fundamental Entitlements"):


      (a)     the availability for the use of such members of the world class sporting, health,
              fitness, tennis, racquet sports and social club referred to in clause 2 of Schedule 5 to
              this memorandum of understanding.
        (b)    the availability for use by such members of tennis courts in accordance with the
               schedule referred to in clause 3 of Schedule 7 to this memorandum of understanding.


        (c)    the right to be a member of the Club upon payment by such members of the
               Foundation Membership fee referred to in clause 2 of Schedule 2 to this
               memorandum of understanding.

        (d)    the entitlement to purchase the "A" class shares referred to in clauses 5.2 (h) and
               5.2(i) of this memorandum of understanding at the issue price of $6,000 referred
               to in clause 2(c) of Schedule 3 to this memorandum of understanding.


3.6    The Parties acknowledge that it is fundamental to the Proposal and to the Project that in
       accordance with the provisions of clause 2 of Schedule 7 of this memorandum of
       understanding the New Club referred to in clauses 5.2(o), 5.2(p) and 6.1(l) of this
       memorandum of understanding will, for the conduct and promotion of the sport of
       tennis at White City and the making of a proportionate contribution to the salary and
       employment costs of a tennis director once the full capped amount is payable, receive an
       annual sum equal to 7.5% of the net profits of JAWCC before management fees from the
       operation of the Club, such sum to be capped at a maximum of $100,000 for the first
       year's operation, and for each subsequent year, with such cap being adjusted annually by
       reference to movements in the Consumer Price Index for Sydney. Further those funds will
       be used for the conduct and promotion of the sport of tennis at White City and once the
       annual maximum capped amount is reached the New Club will make a proportionate
       contribution to the salary and employment costs of a tennis director.

3.7    JACS agrees that it will seek to obtain an option to purchase the Land or part of it from TNSW
       or the third party and in the event it obtains the option from TNSW or the third party referred
       to in Clause 1.8 herein or any right to purchase the Land or any part of it then:

      3.7.1   in the event JACS exercises the option from TNSW or the third party that it will exercise
              the option on behalf of WCH, upon WCH simultaneously granting to JAWCC a 99
              year lease of the land entering into the operating agreement referred to in clause
              6.1(e) herein;

      3.7.2   JACS will seek to procure in favour of WCTC a further option to purchase the Land
              or part of it exercisable by WCTC within 90 days of expiry of the



5
                                                 M() I 1 VFO O
                 Option Period in the event JACS is unable to or fails to exercise the option from
                 TNSW or the third party in accordance with its terms.


      3.7.3     in the event WCTC is unable to procure the further option referred to in Clause
                3.7.2 herein and JACS has not exercised the option from TNSW or the third party
                30 days prior to the expiration of the Option Period, then upon WCTC giving
                written notice to JACS that WCTC requires JACS to exercise the option on behalf
                of WCTC, that )ACS will proceed to exercise the option from TNSW or the third party on
                behalf of WCTC.


3.8    The Parties agree that, provided that the present members are assured of receiving
       the Fundamental Entitlements from the implementation of the Proposal and the Project,
       JACS, with the prior written approval [which approval shall not be                  unreasonably
       withheld] of WCTC may after such details of the General Structure set out in clause 5
       hereof and may make consequential changes to the Documentation set out in clause 6
       hereof as may be necessary to implement the Proposal and the Project.


4.     The Conditions Precedent

4.1    The Parties acknowledge that the Project cannot proceed unless:

       (a)      WCH acquires the Land or a sufficient interest in the land at least so much of it as is
                necessary for the successful completion of the Project

       (b)      the Approvals and all necessary operating consents and licences are obtained;


       (c)      sufficient shares in WCH are sold to make the Project commercially viable. ("the Pre-
                conditions").


5.     The General Structure

5.1   The general structure and relationships between the Parties and between other entities
      necessary to give effect to the project are set out in the diagram that is Attachment "C"
      hereto.


5.2   That structure and those relationships and the method of giving effect to them is more
      particularly described as follows:


      (a)       JACS will cause a company to be called "John Alexander's White City Club Pty
                Limited" ("JAWCC") to be incorporated in which, at least at the time of its
                incorporation, all the issued shares will be held by JACS and all the directors
                shall be appointed by JACS;



         6
(b)    JACWW will be the principal operating company for the Project;

(c)   it shall be open to JACS to obtain other shareholders for JAWCC from time to time and to
      appoint other directors;

(d)   JACS will cause a company to be called "White City Holdings Limited" to be incorporated in which,
      at least at the time of its incorporation, all the issued shares will be held by JACS and
      three directors shall be appointed; two by JACS and one of which will be a foundation
      member of WCTC appointed by the WCTC;

(e)   WCH shall own the Land unencumbered or have a sufficient interest in the land, or such part of
      it as is acquired, and the improvements on the Land;


(f)   The owner of the land shall grant to JAWCC a 99-year lease of the Land and buildings
      ("the Lease") and enter into an operating agreement with JAWCC ("the Operating
      Agreement") to continue for the duration of the Lease;

(g)   pursuant to such Lease and Operating Agreement, JAWCC will operate the Club and pay
      land tax, Council rates, water rates and the reasonable expenses incurred by WCH in
      preparing and publishing statutory returns, lodging statutory returns and conducting
      periodic board meeting for the proper governance of WCH;


(h)   JACS shall cause the capital structure of WCH to be altered so as to consist of 6,000 shares being
      approximately 850 "A" class shares and approximately 5,150 other shares as may be
      necessary to make the project commercially viable;

(i)   "A" class shares in WCH shall be available for purchase only by Foundation Members
      pursuant to the terms of a prospectus ("the A Prospectus") which shall be formulated and
      organised by JAWCC;

(j)   it will not be necessary for a Foundation Member to purchase an "A" class share to become
      a member of the Club, but he or she will have to be a member of the New Club to be
      eligible to do so;


(k)   other shares shall be offered to members of the public pursuant to the terms of a
      Prospectus ("'the B Prospectus") which shall be formulated and organised by JACS and
      JAWCC;
(l)   when a sufficient number of shares has been allotted to fund the purchase of the Land and
      the construction of the Club, the holders of such shares will elect new directors and the
      nominees of JAWCC will retire its shares for a nominal consideration to persons nominated
      by the new Directors of WCH;


(m)   the matters set out in sub-paragraphs (h), (I), (j) and (k) will be included in an agreement
      to be entered into between JACS, JAWCC and WCH ("the Establishment Agreement");


(n)   the total number of memberships will be limited to 6,000 and the holders of shares in WCH shall
      upon payment of the stipulated joining and annual fees have first call on the entitlement
      to membership of the Club;

(o)   JAWCC and WCTC shall cause the incorporation of a new tennis club ("the New Club") the
      purpose of which will be to replace WCTC and provide an organisation and facilities for
      traditional WCTC tennis activities, it being intended that there be no cost of membership of the
      New Club;


(p)   WCTC shall decide upon the name of the New Club, the form of its constitution and
      the identities of the first directors:

(q)   all existing members of WCTC will be eligible to become members of the New Club,
      together with such holders of "B" class shares in WCH as shall desire to play competitive
      or social tennis and as are approved for membership by the directors of the New Club;


(r)   JAWCC and the New Club will enter into an agreement ("the Entitlements Agreement") by
      which JACWW will provide to members of the New Club for the duration of the Lease,
      facilities for playing competitive and social tennis.


6.    The Documentation

6.1   JACS will, with all appropriate legal, accounting and taxation advice, be responsible for
      the following activities and the preparation of the following documents:


      (a)     the incorporation of JAWCC and the preparation of its constitution;
      (b)     the incorporation of WCH and the preparation of its constitution;




                                               MOU VER 9
                                                  8
(c)   the obtaining of all approvals necessary for the use of the Land for the purposes of the
      Project, the construction and operation of the Club and, if necessary, the subdivision of the
      Land;


(d)   the borrowing of monies to fund the purchase of the Land and the construction of
      the Club and the preparation of all documentation necessary in relation to such
      borrowings;


(e)   the preparation of a Lease and an Operating Agreement between WCH and JAWCC,

(f)   the preparation of the Establishment Agreement between the WCH and JAWCC

(g)   the restructuring of the capital of WCH to provide for the issue of appropriate
      classes of shares;

(h)   the obtaining of an underwriter for the sale of shares and the preparation of all necessary
      agreements relating to such underwriting;


(i)   the preparation of the appropriate Prospectuses;


(j)   the allotment of "A" class shares to Foundation Members and the procedures necessary
      for such allottees to become members of the Club;


(k)   the allotment of any other shares to subscribers and the procedures necessary for
      such allottees to become members of the Club;


(l)   in conjunction with WCTC, the incorporation of the New Club and (m) the preparation of
      the Entitlements Agreement between the New Club and JAWCC.

6.2   Further:

(a)   the constitution of JAWCC shall contain, inter alia, provisions to the effect of those set out in
      Schedule 2 hereto;


(b)   the constitution of WCH shall contain, inter alia, provisions to the effect of those set out in
      Schedule 3 hereto

(c)   the Operating Agreement shall contain, inter alia, provisions to the effect of those set out in
      Schedule 4 hereto;



                                                   9
          (d)    the Establishment Agreement shall contain, inter alia, provisions to the effect of
                 those set out in Schedule 5 hereto;

          (e)    the constitution of the New Club shall contain, inter alia, provisions to the effect of
                 those set out in Schedule 6 hereto.


6.3       JACS shall at its own expense with all due skill, care, responsibility and expedition use its

          best endeavours to pursue the fulfilment of the project. 7. Disclaimer


7.1       Nothing in this MOU shall be taken to constitute the Parties as partners or as joint venturers
          for any purpose whatsoever.


8.        Miscellaneous

8.1       Each of the Parties shall bear its own legal costs of the preparation and execution of this MOU
          and JACS shall bear any stamp duty payable upon it.




The Common Seal of WHITE CITYTENNIS CLUB LIMITED was here unto affixed in the presence
of: )



President




      The Common Seal of JOHN ALEX
      ANDERS CLUBS PTY LTD was
      hereunto affixed in the presence of:
                                                    SCHEDULE 1

The land being all or part lot 3 in Deposited Plan 234605 in the Parish of Alexandria, County
of Cumberland, and being the whole or part of the land in Folio Identifier 9/11680.

                                                    SCHEDULE 2
                             Matters to be included in the constitution of JAWCC



1.          Any person who was at 31 July 2004, and remains at the date of the establishment of the
            Club, a member of WCTC, shall be entitled to become a Foundation Member of the Club
            upon completion of the necessary application form and the payment of the Foundation
            Membership fee.

2.          The Foundation Membership fee of the Club will be the sum equal to the
            membership fee payable by the member to WCTC as at 31 July 2004, adjusted by reference to the
            movement in the Consumer Price Index for Sydney between such date and the date upon which the
            member joins the Club.

3.          Any member of JAWCC who wishes to participate in the traditional competition tennis,
            social tennis and social activities of the WCTC as they were at the date of the EGM must
            become a member of the New Club.

4.      JAWCC         will   establish    various    categories     of   membership,   including   a   tennis
        membership category. Tennis memberships will be based on the number of tennis
        members per tennis court. Initially there will be an upper limit of 40 tennis members per
        grass court and 80 tennis members per non-grass surfaced court. These numbers will be
        adjusted from time to time in agreement with the New Club on the basis of actual tennis
        court usage.


                                                    SCHEDULE 3
                              Matters to be included in the constitution of WCH


1.          There shall be a maximum of 6,000 shares.

2.          The following rights and conditions shall attach to "A" class shares:

            (a)    The number of "A" class shares issued will equal the number of members of WCTC as
                   at the 31st July 2004 who remain members of good standing of WCTC at the time the
                   shares are issued, that is to say the number of prospective Foundation Members.




MOU VER 9
(b)   If all the "A" class shares are not sold within 60 days of the issue of the A Prospectus, such
      shares can be converted to "B" class shares and offered to members of the public in
      accordance with the terms of the B Prospectus.


(c)   The issue price for "A" class shares shall be $6,000.

(d)   The monies subscribed for the issue of each "A" class share shall be deposited into a
      third party cash management trust account and shall be held there until such time as all
      consents and approvals necessary for the use of the Land for the purposes of the Project,
      the construction and operation of the Club and, if necessary, the subdivision of the Land
      have been obtained, and funding has been secured for the completion of the Project.

(e)   Upon the obtaining of all such consents and approvals, and upon the securing of such
      funding, such subscription monies shall be available to be used to complete the purchase of
      the Land, to develop and construct the Club, and to bring the Project to fruition.

(f)   If all such consents and approvals or funding are not able to be obtained or secured, the
      monies paid by each such subscriber, together with interest received, but less bank charges,
      shall be returned to him or her.

(g)   The holder of an "A" class share shall be entitled to re-sell such share, but only through
      JAWCC as the agent for the holder. A transfer fee of up to 5% for the first sale and for
      each subsequent sale a fee determined by JAWC from time to time, shall be payable upon
      such sale. Each share may be transferred once only by way of gift to a family member
      without the payment of a transfer fee. "A" class shares cannot be resold until 6000
      shares have been sold or their sale has been suspended or construction of the Club
      commences, whichever occurs first.


(h)   The holder of an "A" class share has the automatic right to be a member of the Club and
      the New Club upon payment of the annual foundation membership fee rthe-         u.


(i)    The privileges for "A" class shareholders who become members of the New-, Club will include:

      i.   A personal annual membership fee that is the total membership fee payable by a "full
           playing' member of WCTC at the commencement
           date of the 99 year lease to be entered into between WCH and

            12
            JAWCC indexed annually in accordance with the National Consumer Price (Sydney)
            Index.

                ii.       Memberships for their spouse and children under the age of 18 years at
                          an annual fees levied by JAWCC for these classes of membership for new
                          members.

              iii.        The retention of the rights attaching to their membership of the WCTC to
                          play badge and attend WCTC functions.


3.    The following rights and conditions shall attach to other classes of shares:

      (a)     The number of other classes of shares will be 6,000 less the number of "A" class shares.

      (b)     Other classes of shares may be acquired by persons who become members of
              WCTC after 31 July 2004 and by persons who are not and do not become members
              of WCTC.


      (c)     The issue price of other classes of shares will be determined by JACS.

      (d)     The monies subscribed for the issue of other classes of share shall be deposited
              into a cash management trust account and shall be held there until such time as all
              consents and approvals necessary for the use of the Land for the purposes of the
              Project, the construction and operation of the Club and, if                necessary, the
              subdivision of the Land have been obtained, and funding has been secured for the
              completion of the Project.

      (e)     Upon the obtaining of all such consents and approvals, and upon the securing of
              such funding, such subscription monies shall be available to be used to complete the
              purchase of the Land, to develop and construct the Club, and to bring the Project to
              fruition.

(f)   If all such consents and approvals or funding are not able to be obtained or secured, the
      monies paid by each such subscriber, together with interest received, shall be returned to
      him or her.

(g)   The holder of other classes of share shall be entitled to re-sell such share, but only through
      JAWCC as the agent for the holder. A transfer fee shall be payable upon such sale. Each
      share may be transferred once only by way of gift to a family member without the
      payment of a transfer fee. No such share may be sold until either all shares have been
      subscribed for or JAWCC, in its discretion, determines that because a sufficient number of
                shares have been subscribed for, re-sale of such shares ought to be permitted.

                                               SCHEDULE 4
                        Matters to be included in the Operating Agreement

1.      JAWCC shall manage and operate the Club for 99 years or for the duration of the Lease,
         whichever shall be less.


2.      JAWCC shall be responsible for all the costs of operating the Club including, but not limited
        to:


         •      The employment of all administrative staff.

         •      The employment and engagement of all operational staff and contractors in areas
                including health and fitness, child care, tennis court curation, maintenance of
                grounds and gardens, and the repairs, cleaning and maintenance of buildings,
                swimming pools, tennis courts, grounds and equipment.


        •       The engagement of all accountants, auditors and consultants.

        •       The costs of all marketing, advertising and sales.

        •       The cost of all necessary insurances.

        •       The payment of public utilities.

3       JAWCC shall maintain grass courts at world class standard.

4.      JACW may only convert grass courts to other surfaces after obtaining a majority vote of tennis
        members.
5.      JAWCC will undertake to honour its obligations under the Entitlements Agreement.

6.      JAWCC and WCH will undertake discussions reasonably and in good faith at least every 10 years
        to consider the lease and operating agreement with a view to maintaining the relevance of their
        terms to contemporary conditions.


                                    SCHEDULE5
               Matters to be included in the Establishment Agreement

     1. Each of the obligations and duties imposed upon JACS by this Agreement shall be undertaken
        performed and discharged by JACS or shall be procured by JACS to be undertaken, performed
        and discharged by JAWCC, as may be appropriate at the time.

                                                                        14
  2.   JACS will develop a world class sporting, health, fitness, tennis, racquet sports and
       social club and, subject to the obtaining of all necessary statutory approvals and
       consents, such club will include the following facilities:


       (a)     members' reception area, lounge, locker rooms, activity areas and clubrooms;


       (b)     state of the art gymnasium;

       (c)     a tennis club retreat designed and operated to preserve the heritage and
               atmosphere of tennis at White City;

       (d)     23 tennis courts, with a minimum of 10 lawn tennis courts, including the
               historic Centre Court;


       (f)     glass backed championship squash courts;

       (g)     one indoor 25 metre heated swimming pool;

       (h)     one outdoor 25metre heated swimming pool.

       (i)    water features such as children's' splash pool, Jacuzzi pool, sauna and steam
              rooms;


       (j)    child care facilities;

       (k)    coffee shop/cafe/restaurant, bar and clubroom;

       (l)    sports retail facilities;

       (m)    car parking.




_ 3.   The Club will not contain gaming machines.


  4.   JACS will do all things necessary and desirable to establish the Club including, but
       not limited to:
       (a) undertaking negotiations with all relevant statutory and other authorities to obtain
              all necessary approvals to the construction and operation of the Club and the
              completion of the Project;

       (c)    consulting with a committee established by WCTC on the design and location
              of the Club and its facilities.


       (d)    creating the concept and design for the Club and its facilities;
(e)   instructing and dealing with lawyers, accountants, architects, designers, builders,
      suppliers and contractors;


(f)   arranging and overseeing the construction of the Club and its facilities;


(g)   procuring the negotiation, drafting, and execution of all necessary documents;
(h)   obtaining an underwriter for the issue of shares;

(i)   obtaining the issue of prospectuses, in compliance with the relevant laws;

(j)   arranging and securing finance necessary for the undertaking of the Project;


(k)   marketing and selling shares in WCH.

5.    JACS will cause the proceeds from the issue of all shares in WCH to be paid into one or
      more third party cash management trust accounts and shall be held there until such time
      as all consents and approvals necessary for the use of the Land for the purposes of the
      Project, the construction and operation of the Club and, if necessary, the subdivision of the
      Land have been obtained, and funding has been secured for the completion of the Project.

6.    Upon the satisfaction of the Pre-conditions, if there is a shortfall between the monies
      held in such management trust account or accounts and the monies needed to purchase
      the Land and complete the Project, JACS will pay the amount of any shortfall to WCH.

7.    Upon the satisfaction of the Pre-conditions, if there is a surplus of monies held in such
      management trust account or accounts over the monies needed to purchase the Land and
      complete the Project, the amount of such surplus shall be paid to JACS as a facilitation fee.


8.    The matters set out in paragraphs 6 and 7 hereof shall be disclosed in the
      Prospectuses.


9.    During construction of the Club, JACS will:

      (a)     provide Foundation Members with suitable temporary premises;

      (b)     safely store the memorabilia of WCTC.




                                                    1A
10.   Prior to the opening of the club for all members WCH will provide Foundation Members
      with exclusive access to the Club and its facilities for 2 days plus one weekend as part of
      the soft opening process.


11.   After the opening of the Club, selected memorabilia of WCTC will be displayed
      appropriately throughout the Club's premises and such display will be maintained and
      changed from time to time.


                                               SCHEDULE 6
                  Matters to be included in the constitution of the New Club


1.    The constitution will provide, inter alia, for:
      (a)    the objects of the New Club;

      (b)     membership qualifications;

      (c)     procedures for becoming, and for ceasing to be, a member;

      (d)     elections and conditions of tenure of office bearers and directors;

      (e)     the establishment, and the constitution of a Tennis Committee;

      (f)     the powers and duties of the Board and of the Tennis Committee;

      (g)     general meetings;


      (h)     meetings of directors;


      (i)     subscriptions;


      (i)     by-laws and regulations;


      (k)    such other matters as are usually found in the constitutions of such
             companies.


                                               SCHEDULE 7
                    Matters to be included in the Entitlements Agreement

1.    Throughout the term of the Lease and the operating agreement and during any holding
      over period JAWCC will do all things reasonably necessary to facilitate and promote the
      administration by the New Club of the traditional competition tennis, social tennis and
      social activities that WCTC and its members engaged in at the date of the EGM. JAC's
      and the WCTC will formulate a written description of those activities that will constitute
      the basis of JAWCC's obligations under this provision.


2.    JAWCC will pay to the New Club, for the conduct and promotion of the sport of
      tennis at White City and the making of a proportionate contribution to the salary
     and employment costs of tennis director once the full capped amount is payable, an annual
     sum equal to 7.5% of the net profits of JAWCC before management fees from the
     operation of the Club, such sum to be capped at a maximum of $100,000 for the first
     year's operation, and for each subsequent year, with such cap being adjusted annually by
     reference to movements in the Consumer Price Index for Sydney. Further those funds
     will be used for the conduct and promotion of the sport of tennis at White City and
     once the annual maximum capped amount is reached the New Club will make a
     proportionate contribution to the salary and employment costs of a tennis director.


3.   WCTC will provide to JAC'S in writing for JAC's approval, a schedule identifying the
     courts that the New Club wishes to have reserved on particular days and at particular
     times for the use by its members for their traditional competition tennis and social tennis.
     The New Club will use its best endeavours to formulate such schedule so that it reflects
     the pattern of usage of courts that existed for the twelve months prior to the date of the
     EGM, while ensuring that sufficient courts are available for such tennis activities. In the
     event that JACWW does not approve such schedule as submitted, JAWCC and the New
     Club will each use its best endeavours to reach a reasonable agreement upon the
     schedule to be adopted.

4.   After the completion of the Club, JAWCC will make available to the New Club a room
     from which it can administer its affairs, together with adequate space in which to
     conduct Board, general and Committee meetings.

5.   If, at any time, JACS wishes to sell all, or a substantial part, of its shares in JAWCC to
     a third party:

     (a)    the new Club will have the right of first refusal to purchase such shares at the same
            price as that which the third party is prepared to pay;

     (b)    if it does not purchase such shares, the New Club must approve the identity of
            the third party, but such approval will not be unreasonably withheld provided
            that such third party is able to demonstrate that it is solvent and could adequately
            operate the business of the Club;

     (c)    such third party must bind itself to honour all agreements and arrangements
            entered into by JAWCC with the New Club, and to ensure that all members of WCH
            continue to receive the rights and privileges that are attached to their shares.




                                                1   s
6.    If, at any time, JAWCC wishes to sell the business of the Club, and to assign the Lease and
      the Operating Agreement, to a third party:

      (a)    the New Club will have the right of first refusal to purchase the business and to
             take an assignment of the Lease and Operating Agreement at the same price as that
             which the third party is prepared to pay;

      (b)    if it does not purchase the business, the New Club must approve the identity of
             the third party, but such approval will not be unreasonably withheld provided that
             such third party is able to demonstrate that it is solvent and could adequately
             operate the business of the Club;


(c)   such third party must bind itself to honour all agreements and arrangements entered into
      by JAWCC with the New Club, and to ensure that all members of WCH continue to receive
      the rights and privileges thatare attached to their shares.