Leland Wykoff

Legal analysis of Ohio Supreme Court ruling: http://www.exemplify.com/employment-agreement-dispute Legal eagles will enjoy this read.

Excellent analysis and brief on the Jack Falfas Ohio Supreme Court ruling: http://www.legallyspeakingohio.com/2014/09/merit-decision-former-cedar-fair-coo-does-not-get-his-job-back-cedar-fair-l-p-v-falfas/

Preview of Supreme Court Ruling here: http://www.sconet.state.oh.us/rod/docs/pdf/0/2014/2014-Ohio-3943.pdf Note this is not the published and final ruling--some minor changes may occur prior to it being reported [published]. This is a bad omen for binding arbitration. This sets the mold for challenge of a variety of rulings by arbitration panels. It is the job of those drafting agreements to be clear as to the terms, conditions, and remedies of those agreements. The court should not have placed its noise under the tent of arbitration. No abuse legal occurred here. Just poor drafting of an employment contract. For the pitiful, detail starved, Sandusky Register report please see: http://www.sanduskyregister.com/news/business/6110506

Interesting feature article and comments at the New York Times about Dollywood: http://www.nytimes.com/2014/08/24/travel/dollywood-a-little-bit-country-a-little-bit-gay.html?_r=2 Appeared in the print edition Sunday, August 24th, on the front page of the Travel section.

Big changes. Remember, satellite corporate office is now located in Charlotte. A review of the sales, food and beverage, and other job descriptions from the past year all indicated they are about to make much bigger changes than the drapes (hat tip to Cloris Leachman in High Anxiety). Season likely will be extended due to the temperate climate of the South. Much opportunity exists with this park located within a days drive of such a large percentage of the population.

Something smells fishy.

Gays will not be welcomed aboard, even two by two, at the Ark Park: http://www.huffingtonpost.com/2014/08/19/ark-encounter-gay-employees_n_5691874.html?utm_hp_ref=gay-voices Thinking of what the protest Twitter accounts and Facebook pages names might be: ArkEnemy, DeciplesDisciplined, ArkBack, BilgePump, ShipOfFools, NoahOverboard, SlipperyKY, or who knows what else.

Busch Gardens Williamsburg is experiencing many issues under Seas Management. Ride closures, failure to inject large marketable capital projects, perception of food quality decline, not to mention significant labor issues. Thus they may be eager to offload this property. Cedar Fair could be a likely acquirer. Recall Cedar Fair has a recent transaction relationship with Sea World due to the sale of Soak City. Sea World stock has been clobbered. Given Busch properties do not prominently feature live animal attractions Sea World may see them as being outside management expertise and perceive a lack of opportunity to leverage the core competency associated with wrangling cash out of what amounts to for profit zoos. Seas has announced a significant stock buy back program. The cash has to come from somewhere. Cedar Fair is now in much better financial shape with a much improved balance sheet. The CEO reminds us they are always evaluating opportunities to make selective additions and are in a position to do so. Seas may be underwater with Busch Gardens Williamsburg. Is it likely Cedar Fair could acquire Busch Gardens properties from Seas? Tough question. But stranger things have been know to happen.

America's finest news source reporting new super long coaster: http://www.theonion.com/articles/busch-gardens-unveils-new-9600milelong-endurance-c,36691/

Ran across this essay and though it worthy of sharing: http://illusion0flife.wordpress.com/2014/08/12/defining-our-medium-a-k-a-what-the-hell-is-a-theme-park-anyway/ It explores questions such as are theme parks "art?" and what is a theme park? The writer settles upon a good working definition incorporating elements such as immersion, artificial environments, entertainment and education. The writer compares and contrasts Knott's Berry Farm and Disneyland as he constructs his essay. Interesting observations and analysis of Knott's to be sure. Enjoy the read.

An excellent case review featuring specific observations concerning the supreme court arguments and analysis. Worth the read: http://www.legallyspeakingohio.com/2014/04/whats-on-their-minds-enforcing-a-shotgun-marriage-cedar-fair-l-p-v-jacob-falfas/

So much for the idea of "free federal funding." Bet the locals did not count on that twist. The big lesson here is all money is money. Federal tax dollars are "your" dollars just like local tax dollars are "your" dollars. Or debt. Depending on which way you look at it. Walkable cities are not a product of streetcars. It is much more involved. Compare the public cost of the streetcar with the public cost of reopening Kentucky Kingdom and one quickly sees how expensive public transportation actually is. It is a very poor allocation of capital. Rental cars are cheaper to provide than public transportation schemes. Wisconsin elected a governor in large measure due to his promise to kill the high speed rail funding from Washington. Seems the operating losses going forward were to great for the state to carry. “Disbelief in magic can force a poor soul into believing in government and business.” -- Tom Robbins

Golden rule of business and economics "Sunk costs are irrelevant costs." This is an often broken, and more often misunderstood, rule. In essence the rule means you do not keep spending money on a bad decision just because you already have "sunk" money into the decision. I predict future problems for this streetcar project if Cincinnati failed to get performance bonds from those civic organizations and businesses who today promise to cover operating losses. That will prove to be a hard debt to collect years down the road when the project is complete. The concept of walkable cities is predicated upon much more than streetcar lines. Many components must first be in place to create viable pedestrian zones and bring back downtown areas. For and excellent read on this topic please see Jeff Speck's interview and book link: http://www.npr.org/2012/11/17/165239291/what-makes-a-city-walkable-and-why-it-matters

More details: http://www.nytimes.com/2013/12/23/us/cincinnati-streetcar-plan-pits-desire-for-growth-against-fiscal-restraint.html?_r=0 Mayor won election based in part on the promise to kill the streetcar.

Orlando Sentinel article interviews, reports, and gives good background on the growing influence of technology on the amusement park industry: http://www.orlandosentinel.com/business/os-cfb-talking-with-tom-burnett-20131201,0,1753496.story Of interest is the news concerning Cedar Fair and Disney developments. An overview of the consolidation occurring among service provides of tech support companies provides a good basis to understand the influences bearing down upon the industry.

Knott's Berry Farm announces the expansive refurbishment of the Calico Mine ride and the refreshment, expansion, and integration of Camp Snoopy: http://www.4-traders.com/CEDAR-FAIR-LP-12697/news/Cedar-Fair-LP--Knotts-Announces-Major-Plans-For-2014-17477824/ The announced improvements continues the trend established last year of honoring and updating the historical features and themed elements of the iconic park.

In a broader move into the entertainment business Herschend, operator of amusement and theme parks such as Dollywood, purchases the Harlem Globetrotters. See New York Times Dealbook column for more details: http://dealbook.nytimes.com/2013/10/01/new-owner-for-harlem-globetrotters/?_r=0

Negative reviews and reactions to granting of tax abatement's for Carowinds: http://www.carolinajournal.com/daily_journal/display.html?id=10524

Perhaps Cedar Fair will take advantage of "executive bonus claw back provisions" to cost recover part of the losses due to the Falfas episode. When performance bonuses are granted and paid based upon false numbers, the SEC allows for a claw back of the overpaid benefit. If I were Richard Kinzel, or his council, I would be concerned. Given Mr. Kinzel may have filed a false report with the SEC concerning the Jack Falfas departure, well, it could result in recovery efforts by Cedar Fair. For an interesting read concerning poor corporate governance (involving another party with Cleveland ties) please see this recent Plain-Dealer article: http://www.cleveland.com/business/index.ssf/2013/05/pilot_flying_j_director_overse.html The SEC moved to strengthen corporate governance by allowing for executive bonus claw backs following the shenanigans at Saks Fifth Avenue. In the Saks case the resigning executives who allegedly engineered the fraud, and profited by receiving quarterly bonuses, for which they did not in reality qualify, kept the ill gotten gains. Saks was not by any means the only such case of poor corporate governance related to executive over-payments. But it helped end the practice and spur the SEC onto tighter rules and regulations.

Ohio Supreme Court agrees to review Jack Falfas arbitration ruling reinstating Falfas to the position of COO: http://www.morningjournal.com/general-news/20130925/ohio-supreme-court-to-consider-case-of-former-cedar-fair-executive See order of Court here: http://www.sconet.state.oh.us/pdf_viewer/pdf_viewer.aspx?pdf=196457.pdf It appears from the Morning Journal report Cedar Fair seeks the Ohio Supreme Court to overturn a binding arbitration ruling principally on the grounds the outcome was not agreeable. The binding arbitration agreement may well be found to be the controlling instrument--not state law in general. Had Cedar Fair intended to restrict an arbitration panel from ordering back-to-work findings they could have simply written the binding arbitration agreement to bar (or forbid) such awards. Other equitable solutions were possible, such as, for example, monetary awards and damage schedules containing loss caps. If the court finds this was a contract of adhesion [when one party offers up a contract for acceptance by a second party in which they must accept the terms and sign the contract without benefit of term negotiation] disputes as to intent of contract always fall to the accepting party. The legal principal being that those drafting and offering such contracts of adhesion should carefully consider the terms of said contracts. Put another way, the drafting party has the upper hand and must act with extreme care. Cases of contract confusion are by default found to be in the favor of the signing party. At least that is my uneducated understanding of the legal principals.

More details From the Charlotte Observer: "The city economic development office had given council members more details about plans for the park in June. The new 300-foot roller coaster would cost $30 million. In addition, the park would spend $2.5 million on a new water slide, $7 million on a new food complex and $4 million on ticket booth and parking lot improvements, according to Peter Zeiler of the city." The $4 million ticket booth and parking improvements again suggest a Gatekeeper type coaster. Such a coaster could fly guests over two states. Read more here: http://www.charlotteobserver.com/2013/09/18/4323933/new-carowinds-ride-to-be-70-feet.html#storylink=cpy http://www.charlotteobserver.com/2013/09/18/4323933/new-carowinds-ride-to-be-70-feet.html#.UjteLD_xvIU Another Observer article included this tid-bit: "The company predicts the expansion would increase yearly attendance by 385,000 customers and create 15 full-time jobs with an annual average salary of $43,000."

Cedar Fair seeks $900,000.00 tax breaks to expand North Carolina side of Carowinds: http://www.charlotteobserver.com/2013/09/12/4309222/carowinds-seeking-900000-in-incentives.html#.UjMnkz_xvIU http://www.wcnc.com/news/local/Carowinds-seeking-900000-in-incentives-223557201.html

Carrowinds shall also have new air conditioned restaurants, food options, and menu items next year. The two new mega water slides, and other improvements, are described in a bit more detail at the Wall Street Journal: http://online.wsj.com/article/PR-CO-20130907-901776.html

Carowinds offers perhaps the best opportunity for in-house growth and expansion within the Cedar Fair stable. Carowinds can be a year--or near--round destination park. Expansion of the season(s) is rich in this temperate climate. They have extensive excess land having acquired additional acreage a couple of years ago. Located next to a major interstate corridor, in a growing region, Carowinds is ripe for campground, hotel, water park, and possibly resort additions and enhancements. Carowinds offers the promise of extended seasons and the resulting more efficient use of invested capital. No doubt the march toward comprehensive themed areas will continue (see Cedar Point announcement to add rides and relocate two rides to Camp Snoopy, and the refreshment of historic rides and the new boardwalk area at Knott's) with the expansion and improvements at Carowinds. The dollar simply buys more in the South and in Ohio. The announced $50 million plan will produce much more bang-for-the-buck than the same money spent in California or Sandusky. Use of local vendors and construction companies will leverage lower labor cost advantages. The Ouimet management team previously announced the development of a new dark ride product for introduction at Cedar Fair properties. Such developments will further work to keep costs in check while delivering "best day of summer experience." Be looking for the edition of an exciting dark ride at Carowinds. Having opened a satellite corporate office in Charlotte, Cedar Fair has acknowledged the growth potential of this market and Park. Recall last years Shareholders Annual Meeting was virtually held at the Carowinds gate. The Board of Directors and management team had the opportunity to see and review the opportunities of this near-year-round property. This is a significant announcement. How many times in the past has Cedar Fair announced a three year capital plan? This announcement says a great deal and expresses the full confidence Ouimet and his Team have in Carowinds. It will be FUN to watch!

In the conference call CEO Ouimet foreshadowed the limited value of stand alone water parks to Cedar Fair: "...Worlds of Fun was our last park it didn’t take advantage of two parks for one price which is an incredibly compelling consumer messaging and we’ve seen exactly that happen at World of Park as we had anticipated. It’s also a strongly defensible position against water park – standalone water parks because the value proposition is great for the consumer. And then the third thing is water parks play a disproportionate role in driving season pass sales because people see themselves going into the water park more times than they go to the amusement parks." Matt Ouimet in response to a question from Jeffrey Thomison of Hilliard Lyons, please see transcript, page six, from Seeking Alpha: http://seekingalpha.com/article/1620642-cedar-fairs-ceo-discusses-q2-2013-results-earnings-call-transcript Cedar Fair seeks to expand via combined gates and grouped gate revenue streams such as leveraging resorts, hotels, campgrounds, adjacent or attached water parks, go-cart attractions, restaurants, and other related businesses. Watch to see how Ouimet develops the auto industry property acquired near Cedar Point. Proceeds from the sale will likely be deployed to the hotel refreshment program, point of sale roll out, and arm band payment systems.