It is with deep regret and sadness that the Board of Souths on Chalmers (South Sydney Leagues’ Club) has found itself in a position where it has no option but to file for Voluntary Administration. Many of you will be aware that ownership of the building by South Sydney Leagues Club was forfeited when the Club was last in Administration in 2006. The new building owners became High Concept Commercial, a joint venture initially created between the South Sydney Football Club and builder Trivest. As part of the joint venture the Leagues Club was granted 1500 sq mts of the 1st Floor and a $3million fit out. Unfortunately for many reasons the $3million fit out took longer to complete than we had expected and in the meantime eroded our working capital. As time went on the Board recognized that, if we had not stepped in and taken control of the completion of the fit out, the doors of the club would never open. With no other option available, we entered into a contract with the builder whereby we took over the completion of the project with the understanding that all building work to date would be warrantied and built to Australian Building Standards. It was also agreed, by contract , that the money owed to the Leagues’ Club by the non completion of the fit out obligation would be used as a deposit to purchase the remaining area of the 1st floor the club did not own. Late last year High Concept Commercial went into receivership. At the time that High Concept Commercial went into receivership, High Concept Commercial owed the Leagues’ Club, and the Club had claims against High Concept Commercial for, close to $2million. This related to the cost to rectify poor workmanship, warranty items requiring fixing and the deposit that was to be used to purchase Lot 2 of the 1st Floor. The Board has been in negotiations with the Receivers for High Concept Commercial but has been unable to reach an agreement that will allow the Club to continue to trade and repay creditors without the Club merging with another club. While we have entered into discussions with other Clubs for a merger, unfortunately they have not come into fruition. Many of you will know the many hurdles the Board, management and team at Souths on Chalmers have had to endure to open the doors and keep them open. The decision to put the club into Voluntary Administration has not been taken lightly. This is a very sad and frustrating decision to have to make. It was becoming clear that many of the promotions our CEO Liam Rogers has implemented have started gaining momentum and trading projections were starting to be met. The Club will continue trading through this period of Administration and it will be business as usual until a decision is made as to whether the Administrator has been able to negotiate an outcome for the Club that will allow the business to continue trading into the future.

The administrator upon his review of the situation, was not able to secure funding to continue to trading and as a result the Club needed to cease its trading on Mon Mar 25 2013, while the administration process takes its course. This is the 3rd time the Leagues Club has needed to close its doors due to financial trading issues. The other two times in 1973 and 2006.