KABARNET HOTEL LIMITED

MINUTES OF THE MEETING OF THE BOARD OF DIRECTORS OF KABARNET

HOTEL LTD HELD ON TUESDAY, 6TH APRIL 2021 FROM 10.00 A.M. VIA ZOOM

PRESENT:
Anthony Kingi - Chair of the session
Dickson Yatich - Director
John Mukuna - Director- Rep Orumoi Jonah

ABESENT WITH APOLOGIES:

Yunis Ibrahim - Member
Dr. Peter Chemwile - Member Rep. National Treasury

IN ATTENDANCE:
John Karia - Board Secretary
Benson Kandie - Hotel Accountant/ Ag. Manager

AGENDA
1. Commencement of Meeting;
2. Confirmation of Quorum;
3. Adoption of Agenda;
4. Declaration of Interest;
5. Confirmation of the Minutes of the Board meeting held on 27th January 2021;
6. Matters arising from the Minutes of the Board meeting held on 27th January 2021;
7. Adoption of the Finance Report for Q1&2 2020/2021;
8. Report on Human Resource Matters;
9. Approval of Loan Application;
10. Progress Report on the Hotel Renovations and Refurbishments;
11. Any other business.

MIN. 1/6.04.2021 COMMENCEMENT OF MEETING

Members noted that the Chairman was indisposed hence could not attend the meeting. Members
unanimously resolved to appoint Mr. Kingi as the Chair of the session.

The Chair of the session called the meeting to order at 10:12 a.m and the meeting commenced
with a word of prayer led by John Mukuna.

MIN. 1/6.04.2021 CONFIRMATION OF QUORUM

Chairperson’s Signature………………………………………………..Date…………………………….………………Page 1
The meeting was confirmed as quorate.

MIN. 3/6.04.2021 ADOPTION OF AGENDA

The agenda was unanimously adopted as presented as proposed by Mr. Dickson Yatich and
seconded by Mr. John Mukuna.

MIN. 4/6.04.2021 DECLARATION OF INTERESTS

There was no interest were declared by any member on any matter in the Agenda.

MIN. 5/6.04.2021 CONFIRMATION OF MINUTES OF THE MEETING HELD ON 22 TH

JANUARY 2021

The Minutes of the meeting held on 22nd September 2020 were confirmed as a true record of the
deliberations of the meetings as proposed by Orumoi Jonah and seconded by Dickson Yatich.

MIN. 6/6.04.2021 MATTERS ARISING FROM THE MINUTES OF THE MEETING

HELD 25TH JANUARY 2021

The Board noted the update given on the matters arising from the Board meeting held on 25 th
January 2021.

MIN. 7/6.04.2021 ADOPTION OF THE FINANCE REPORT FOR Q2 & Q2 2020/2021;

The Board received the Financial Report for Q1& 2 of FY 2021/2022 and noted as follows:
 Total turnover for the period stood at Ksh. 655,942(44%) against the budget target of
Ksh. 10,016,799. It represented 11% decrease from the turnover recorded same period in
the previous year of Ksh.7,322,009.
 The cost of sales for the period was Ksh. 25,815 against the budgeted cost of Ksh.
982,117. Cost of sale for the same period last year recorded ksh.1,023,206 against a
budget of Ksh. 816,774 for that period.
 Expenditure for the period stood at Ksh.2,455,574 against the budgeted of
Ksh.7,693,525 . For the same period last year Ksh.7,088,809 was recorded against a
target of Ksh.8,999,904.
 Generally, the hotel was able to record a Net loss of Kshs. (2,429,759) for the period as
compared to the same period last year Kshs. (679,999). There was an increase in losses
for the six months of the current year as compared to last year the same period due to the
closure of the hotel because of outbreak of coronavirus pandemic.

Board Resolution

Chairperson’s Signature………………………………………………..Date…………………………….………………Page 2
After deliberation the Board noted the Financial Report for Q1& 2 of F/Y 2021/2022.

MIN. 8/6.04.2021 HUMAN RESOURCE REPORT

The Board received the Report on the Human Resource Matters and noted as follows:
 The employees were still on unpaid leave after the closure of the hotel in May last year
and completion of their leave and off-days in August 2020.
 Two employees (Store man & Head Waiter) had accumulated off-days which exhausted
in December 2020.
 The only remaining employees were two security guards who were guarding the hotel
and another additional (casual)who taking care of the swimming pool.
 The Hotel has not been in business for ten months and the also accumulated outstanding
salaries before the closure of the hotel was still unpaid for both permanent and
contractual employees whose contracts were terminated in January 2020.
 The management had cleared salaries for December 2019 and September 2019 for
permanent and contractual employees respectively.
 The total Gross salary arrears as at 30th August 2020 was Kshs. 3,971,816.00
 When the board terminated the contracts for the contractual employees because of low
business, and the management had not cleared their gross salaries totaling
Kshs.819,720.00.
 The amount involved if the employees are to be declared redundant was Kshs.
12,113,831.00.
 The amount deducted from the staff payroll through check of system but not remitted to
the Sacco was Kshs. 297,590.
 The amount of service charge to employees yet to be paid from March 2018 to May 2020
was Kshs. 1,340,066.00.
 The dues for the three retired employees was Kshs 2,296,529.00.

Board Resolution
After deliberation the Board noted the Human Resource Report and approved the request to
borrow Kshs 21.9 Million for Tourism Finance Corporation subject to verification of the
amount by TFC. The Board further directed Management to engage the other shareholder to
also inject some funds to the Hotel.

MIN. 9/6.04.2021 PROGRESS REPORT ON THE RENOVATION OF THE HOTEL

The Board received a Progress Report on the Renovation of the Hotel and noted as follows;
 Despite the demand notice issued on 16 th December 2020 to the Contractor to start work
and promises to start in the first week of January2020; nothing had been done.

Chairperson’s Signature………………………………………………..Date…………………………….………………Page 3
  The Contractor only came to undertake the stripping of the rooms, which took three
weeks and thereafter there had been no meaningful progress on the site, also noting that
to date no materials had been delivered to the site either.
 A second letter was issued in March 2021 but the Contractor was yet to respond.

Board Resolution
The Board noted the progress report on the renovation of the Hotel and guided Management to
terminate the contract for the slow progress of the works and liaise with TFC to undertake a fresh
procurement of a Project Manager, an Interior Designer and a Contractor to undertake the
refurbishment works.

MIN. 10/6.04.2021 ANY OTHER BUSINESS

There being no other business the meeting ended at 11.08 a.m.

CONFIRMED THIS……………………DAY OF……………….

…………………………..2021

…………………………………………………
CHAIRPERSON

Chairperson’s Signature………………………………………………..Date…………………………….………………Page 4