Cedar Fair's Kinzel gets an earful

Cedar Point CEO Dick Kinzel has described the past year as his toughest in the business. It didn't get any easier Monday morning, when about 125 unitholders attended Cedar Fair's annual meeting at the Sandusky State Theatre and confronted Kinzel and other executives about resuming cash distributions and other sore points.
Tom Jackson
Jun 8, 2010

 

Cedar Point CEO Dick Kinzel has described the past year as his toughest in the business.

It didn't get any easier Monday morning, when about 125 unitholders attended Cedar Fair's annual meeting at the Sandusky State Theatre and confronted Kinzel and other executives about resuming cash distributions and other sore points.

The company's critics included Patrick Lysobey, a unitholder from North Royalton, who demanded to know why management is well-paid when its unitholders no longer get a cash distribution.

"You guys are the ones who pretty much drove this thing into a ditch," Lysobey said. "We should be the ones being compensated. We are the owners."

Kinzel retorted that the company gave cash distributions to unitholders for 22 of 23 years, stopping only last year when it was forced to do so by bankers holding the company's debt.

"We had one year we couldn't pay that distribution," he said.

In late 2010, after the season is over, Cedar Fair's board plans to try to resume the cash distribution, he said. The company would like to make at least a small distribution to help unitholders meet the tax obligation they face by April 2011.

Here is other news from the meeting and from an interview Kinzel granted when the meeting finished:

n The company's plan to deal with its long-term debt, announced May 20, has been put on hold because the financial markets have been volatile. The board is studying what to do next, Kinzel said.

n Two new members will be announced soon for Cedar Fair's board.

The addition of new directors to the board has been sought by Q Funding, a Texas company which is Cedar Fair's largest unitholder.

* Shoot the Rapids, Cedar Point's much-anticipated new water ride, won't be ready for at least another few days.

"It's not going to happen until we're 100 percent sure it meets all our standards," Kinzel said. "We're not going to rush it."

The manufacturer is doing modifications to the ride in Europe.

Without giving more details, Kinzel said, "It has to do with the boats."

* Some of the attendees at Monday's meeting said they had trouble getting the credentials they needed to be admitted to the meeting and to vote.

Leland Wykoff, a Tennessee resident and a frequent critic of the company's management, said he never got anything in the mail and had to contact his broker. James Edwards, a Sandusky resident, said he also had to call his financial advisor to get the information he needed to vote.

* As expected, three board members were re-elected: Kinzel, Richard Ferreira and C. Thomas Harvie.

The board will grow to nine members when the two additional board members sought by Q Funding are added, but it will shrink back to seven members within a year.

 

Comments

Leland Wykoff







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MicrosoftInternetExplorer4

st1\:*{behavior:url(#ieooui) } /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin:0in; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:10.0pt; font-family:"Times New Roman";} The company is now proclaiming, through public relations spin, the successful reelection of three members to the Board. 

Cedar Fair neglects to mention in the spin* Dick Kinzel CEO, was elected with 71 percent of the unitholders withholding votes for his election.  The two other board members, Mr. Richard Ferreira, and Mr. Thomas Harvie, did a bit better.  The unitholders withheld only 70 percent of the votes from these gentlemen.

Three men took seats on the board winning an election by achieving approximately 30 percent of the votes.  These type of elections are generally thought to occur only in dictatorships and corrupt republics featuring politburos.  But, alas, they are also alive and well right here in corporate America. 

No doubt Board Members and the CEO must feel like children picked last for the team on the playground. 
6079 Smith W

Unitholders might want to ask themselves why Cedar Fair (FUN) is categorized as a small cap value stock. This stock is small potatoes.

Dividend? Good luck with that. It might be easier to squeeze blood out of a turnip.

Consumer spending is anemic and job growth is slim-to-non-existent in the local and national economy.

Unitholders would be better off selling and taking their assets and buying 10 yr. Treasuries - at least you'll see a little return on your investment.

Take a look at a 5 yr. chart of (FUN) - UGLY.

http://finance.yahoo.com/q/bc?s=FUN&t=5y&l=on&z=m&q=l&c=

Credit markets are dry. Cedar Fair will have difficulty refinancing its debt.

If I were a direct unitholder I would have euthanized this dog a stock yrs. ago by selling it.