Q, FUN & SPECIAL MEETINGS, THE FUN CONTINUES

[The Interpreter]

As of yesterday at closing, Q and its affiliates, provided they still own the 18.1 percent of units they last reported, had approximately $192,450,000 worth of Cedar Fair units. That does not mean they would sell them for that price. After all, if it did, they would have. In addition, were Q to announce tomorrow it was going to sell and get out, I strongly suspect the units would fall drastically. And it were to attempt a sell-off without such an announcement, the units might fall even more.

I strongly suspect Q's intention is to buy the company at some point, but...technically one could own 100 percent of Cedar Fair LP and not have control of the master partnership. In addition, relatively recently the Board adopted a poison pill.

[Leland Wykoff]

This "Statement of Changes in Beneficial Ownership" from Kinzel filing just in:

http://xml.10kwizard.com/filing_raw.php?repo=tenk&ipage=7496705

[The Interpreter]

^

It is, after all, tax time. And there's quite a bit of income tax due on an income of $20 million or so. Much much more than on the earnings of a teenager working in a seasonal amusement park, for example.

[Leland Wykoff]

Q Investments calls for the resignation of Cedar Fair Board Members following findings by arbitration panel Mr. Jack Falfas was wrongfully terminated. The company has been ordered to reinstate Mr. Falfas, to his previous position, and pay him full benefits and other consideration called for in his employment agreement.

More here, including a link to the decision of the arbitration panel:

http://www.4-traders.com/CEDAR-FAIR-DEP-UTS-12697/news/CEDAR-FAIR-DEP-UTS-Q-Funding-Calls-for-the-Resignation-of-Cedar-Fair-Board-Members-Who-Mislead-Unith-13587766/

[jzarley]

Granted they're written primarily for the "sound bite" and press release potential, but does anyone else think Q's letters to CF seem strangely non-business like? (I've been reading...and receiving...business correspondence for quite a few years and I can honestly say I've never seen the phrase "shame on you!" used )

The findings of the arbitration panel are quite interesting! I have a feeling things might be a little awkward in the break room on Jack Falfas' first day back on the job!

[jcgoble3]

This "Statement of Changes in Beneficial Ownership" from Kinzel filing just in:

http://xml.10kwizard.com/filing_raw.php?repo=tenk&ipage=7496705

A little off topic, but I noticed something interesting here:

From the bottom of the page:

Persons who respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB Number.

From the top right corner of the page (emphasis mine):

OMB Number: 3235-0287

Expires: February 28, 2011

The transactions reported on the form occurred this month (March 2011), which is after the OMB number's expiration date. He technically didn't have to fill out the form.

[The Interpreter]

Cedar Fair TURMOIL CONTINUES:

http://www.cleveland..._continues.html

This article deserves a full reading...

[The Interpreter]

Cedar Fair's Response To Q Funding's Press Release:

"Based on the actions of Mr. Falfas on June 12, 2010, the Company and its Board of Directors stand behind their conclusion and initial reporting to the Securities and Exchange Commission that Jack Falfas resigned from his position with Cedar Fair Entertainment Company.

Mr. Falfas has disputed the Company's position and chose to exercise his right to a confidential arbitration hearing pursuant to his contract with Cedar Fair. An arbitration panel recently ruled 2-to-1 in favor of Mr. Falfas. In no way did this initial decision conclude that the Company or its Board misled unitholders. The Company is convinced that the arbitrators exceeded their authority by creating a remedy not legally available to Mr. Falfas under his contract with Cedar Fair. The Company is seeking the Court's review of the arbitration award, as it is entitled to do. While the Company disagrees with the conclusions reached by this arbitration panel, it will meet its legal obligations, if any, to Mr. Falfas, as they ultimately may be determined. The Company will also continue to honor the confidentiality of Mr. Falfas' contract and the arbitration hearings and will have no further comment regarding this personnel matter."

http://www.prnewswir...-118614059.html

[Leland Wykoff]

Regarding Cedar Fair's response (see Interpreter's post above):

Talk about splitting hairs.

Cedar Fair in its statement seems to agree with the arbitration panel that Mr. Falfas was terminated and did not resign.

What Cedar Fair disputes is the action imposed: "...convinced that the arbitrators exceeded their authority by creating a remedy not legally available to Mr. Falfas under his contract with Cedar Fair. The Company is seeking the Court’s review of the arbitration award, as it is entitled to do."

This is a complicated way of challenging the order to place Mr. Falfas back in his COO position and restore his salary. If the arbitration panel finds, as it did, Jack was terminated unjustly what other remedy could the panel order but a back to work order?

It would seem Cedar Fair would rather buy-out Mr. Falfas remaining contract than have him back at work. Here is the tell, "While the Company disagrees with the conclusions reached by this arbitration panel, it will meet its legal obligations, if any, to Mr. Falfas, as they ultimately may be determined."

Cedar Fair seems to be angling for a monetary judgment over the back to work order. No doubt they will seek a confidentiality agreement as well as Jack's repudiation of the findings of the arbitration panel. That would fix any SEC filing violations.

To get clarity on this issue simply ask yourself this, "If COO Falfas resigned as Cedar Fair claims, then why would they not be thrilled to welcome him back to the fold?"

The reasonable answers seem to sound something like this, "They will not take him back because they terminated him."

If it had gone down as Cedar Fair insists, they would be delighted to have him back on board.

[AintNutinElse2Do]

If an employer says you can quit or be fired and you leave did you quit? I think this was likely what happened, it is my understanding though it would be in effect termination. Though he may have also known he was in thin ice and left before termination in which case he resigned. Of course I live in a "right to work" state so my understandings of other states is limited. Don't anyone think "right to work" is a great thing though unless your an employer. Just my opinion on that though.

[The Interpreter]

The Morning Journal:

http://morningjournal.com/articles/2011/03/25/news/mj4302950.txt?viewmode=fullstory

The Toledo Blade:

http://toledoblade.com/business/2011/03/25/Cedar-Fair-shareholder-seeks-board-resignations.html

[The Interpreter]

Quoted not as some future prediction, but for his opinion, Lance Hart in Screamscape:

...Now Cedar Fair is attempting to fight the ruling, claiming that Jack is not entitled to get his job back. Of course, I think The Q would disagree with this point (and they likel.y will) as there really is no one else as qualified as Jack to take over as CEO of Cedar Fair when Kinzel leaves in less than a year. I'd love nothing more than to see Jack in the drivers seat here. Stay tuned!..

http://www.screamsca...s.htm#CedarFair

[The Interpreter]

Q INVESTMENTS WANTS FALFAS TRANSCRIPTS:

..."The truth about the dispute is now out there," said Scott McCarty, portfolio manager for Q Investments. "Why not let the whole truth come out?"

Jack Falfas, Cedar Fair's former chief operating officer, claims he was fired in June after a 90-second phone conversation with Cedar Fair CEO and president Dick Kinzel.

Cedar Fair maintains Falfas quit....

http://www.sanduskyr...transcripttjxml

[The Interpreter]

June 2007:

...For the past several years, the day-to-day leadership group at Cedar Fair has been rather small: Kinzel is the head of what Chief Operations Officer Jack Falfas calls "the triad," of which Falfas is a member along with Chief Financial Officer Peter Crage. As Falfas describes it, Kinzel makes the big decisions, Crage controls the finances, and "once we have the direction, my job is to make sure we carry that mission out."

Kinzel hired Falfas in 1975 to run admissions at Cedar Point (he was a seasonal employee even before that), and he's never left. When Cedar Fair acquired Knott's Berry Farm in 1997, Falfas was named general manager; his success in that role led Kinzel to make Falfas, 55, his right-hand man and eventual successor, naming the loyal employee COO in 2005—a job Falfas describes as "herding cats and fixing problems."

"You can be a director, a manager, but until you get the full responsibility and have to make day-to-day decisions that you have to live and die on, that's when a person comes forward," Kinzel says. "When Jack was recruited to go to Knott's Berry Farm, that's when I really saw who Jack Falfas was. I knew he was good—motivating people, being a hands-on manager, knowing maintenance and safety, and loyal. He went to Knott's and changed the whole culture there, and his future was embedded in my life forever."...

The three men agree the Paramount Parks deal was one of the most fulfilling moments of their respective careers, and they worked well together to make it happen with nary a cross word between them...

or not.

http://www.iaapa.org...ngLandscape.asp

[CoastersRZ]

Certainly seems like there was a fall out in the triad. And I think this could get rather ugly. Now, I wonder who will be named the next CEO of Cedar Fair?

[The Interpreter]

Mr. Kinzel was probably right about two things. Mr. Falfas was indeed embedded in his life forever....just not quite the way he thought! And the Paramount Parks deal was indeed monumental...

[jzarley]

I really have to wonder what transpired to cause Falfas to leave the way he did (either by termination or resignation). It's not unusual to hear of #1s & #2s who have stormy relationships, but for Kinzel to completely throw out the organization's entire succession planning strategy (especially at a time when the future of the company was in so much turmoil) in one 90 second phone call, it really challenges the imagination about exactly *what* could have led to that...

[The Interpreter]

...The following statements have been made to the press on behalf of Q Funding III, L.P. and Q4 Funding, L.P.:

"The truth about the dispute is now out there. Why not let the whole truth come out?"

"In our view, this company is trying to hide the truth that there is a dispute. It's one thing not to comment. It's another thing to actually accuse us of lying, when in fact we were trying to get the truth out."

Cedar Fair waited until March 11 to admit there was a dispute over Falfas' departure in June. "It sure looks curious, doesn't it?"...

http://www.sec.gov/A...an14a032811.htm

[Cory Butcher]

I really have to wonder what transpired to cause Falfas to leave the way he did (either by termination or resignation). It's not unusual to hear of #1s & #2s who have stormy relationships, but for Kinzel to completely throw out the organization's entire succession planning strategy (especially at a time when the future of the company was in so much turmoil) in one 90 second phone call, it really challenges the imagination about exactly *what* could have led to that...

My guess would be that successor was ready to succeed...

Or that the leader just wanted to lead...

Regardless of the actual logic behind Jack Falfas leaving, one has to wonder how a decision could be made by someone (CEO), so quickly when their relief from their post is supposedly imminent?

The clouds roll in before the storm hits, and we are left wondering what was in those clouds...

[The Interpreter]

And I'd say that ending was full of sound and fury, signifying something.

I am certain Cedar Fair would like to settle this matter, with a nice confidentiality agreement and parting gifts, thus ending any SEC inquiry.

[CoastersRZ]

But if Falfas was indeed fired, and did not resign, as Q is alleging, then did Cedar Fair not mislead the unit holders? It certainly seems very suspicious to me. And it certainly will further tarnish Kinzel`s reputation, in my opinion. That and the Apollo deal certainly made Kinzel look like he only ever had his best interests in mind, and not those of the company or unit holders.

[The Interpreter]

That all depends. Is Mr. Falfas a man of principle or of principal? His leaving and the circumstances thereof are the principle reason for this arbitration. And FUN is fighting mightily to keep the transcript of the arbitration proceedings secret. If FUN and Falfas can come to an agreement, the true circumstances of his leaving might never be known.

[CoastersRZ]

But what if Falfas is not after monetary gain? What if he is looking after what remains of his career? I mean, he was stated to be Kinzel`s replacement as CEO.

[The Interpreter]

...then, depending on what actually happened and what was said at that arbitration hearing, FUN and/or Mr. Kinzel (if there is actually much difference in those two entities at this point) may have a little problem...or more than a little problem. Q has been tenacious. But why?

[CoastersRZ]

Yeah. I still don`t know what Q seems to be after. At first I thought they were simply trying to turn a quick profit. Their motives still aren`t exactly clear at this point to me.

[The Interpreter]

If Cedar Fair is to be believed, Mr. Raynor and Q have rebuffed every effort FUN has made to reconcile with them. And Q was offered a board seat, which it declined. I don't know much but I do know this, Q IS up to something. All will be revealed in due time, but what will be revealed? I live for mysteries like this!

[thekidd33]

So is Q simply trying to make Kinzel & Co. look as bad as possible? With less then a year left on his contract what is the motive behind that? To gain greater influence in picking his replacement? Or does Q perhaps have a position in mind that they would like to see one Mr. Falfas fill come January of 2012?

[Cory Butcher]

Let me simply state,

First, you find people who like you.

Second, you woo them, and you become one of them.

Third, You learn their weaknesses and you exploit them.

Fourth, you stay consistent, keeping the pressure on and aggravate as much as you can.

Fifth, with the wind at your back, the people on your side, and a perceived injustice to fight, you claim what you wish,

Yeah, OK, so that's a little dramatic, but if you don't see "The Art of War" in this whole drama, you are looking too close. We may not know what Q's motives are, but I think it is becoming plain to see what they want.

And what I described? You might as well find it in a novel called, "The Art of the Takeover" by Anonymous Private Equity Group.

[The Interpreter]

First, you find a company with much potential for unlocked value but whose then depressed value was due at least in part to longstanding somewhat lackadaisical management, used to making relatively easy profits year after year by following the same management strategy, perhaps one that no longer works as well, that of making capital investment X to an individual property and expecting Y return to inevitably follow. It is also helpful to such hunt if the target itself is attempting to sell itself out for a low, low price while rewarding inside senior management with golden parachutes worth perhaps tenfold their typical annual salary. Perhaps you can find a company that made missteps like paying way too much for a massive acquisition, because in part its Chairman/CEO had his eye on a competitor's once flagship asset in the same state where his own company had its principal place of business and its crown jewel (and where the Chairman/CEO actually resided in the parking lot)....

It is even more curious if the then Chairman/CEO of the target company not only somehow dispatches (or causes the dispatch of) the long anointed successor, but also somehow reaps the same compensation for the year of the failed sell out as he would have had the sellout succeeded. And then, when forced out of his Chairman role by, in large part, your efforts, there is installed one of the hand picked cronies from the Board.

There may or may not be analogies to fun examples in the corporate world in that little capsule summary, to which much could already be added, and more no doubt will be.

[The Interpreter]

Having been sued to do so, the Company does:

For Immediate Release

March 29, 2011

Contact: Stacy Frole (419) 627-2227

Cedar Fair FILES PRELIMINARY PROXY STATEMENT FOR REQUESTED SPECIAL MEETING OF UNITHOLDERS

•Company includes its own proposals that, if approved, would give unitholders the right to nominate potential directors for election to the Board

• Recommends vote AGAINST Q Investments' proposal

SANDUSKY, OHIO, March 29, 2011 – Cedar Fair Entertainment Company (NYSE: FUN), a leader in regional amusement parks, water parks and active entertainment, today announced that it has filed a preliminary proxy statement with the Securities and Exchange Commission regarding a Special Meeting of Unitholders requested by Q Funding III, L.P. and Q4 Funding, L.P. (Q Investments), which together beneficially own 5,687,276 units, or approximately 10.28% of the outstanding units of Cedar Fair.

Q Investments has requested a Special Meeting of unitholders to vote on an amendment of the limited partnership agreement to give unitholders the right to nominate directors for election to the Board of Directors. However, Q Investments' proposal is inconsistent with the applicable governance documents of Cedar Fair and Cedar Fair Management, Inc., its General Partner, which requires that the regulations of the General Partner be amended in order to give unitholders the right to nominate directors for election to the Board of Directors. In particular, Q Investments' proposal is solely an amendment of the Company's partnership agreement and does not include the required amendment to the regulations of the General Partner. Therefore, Q Investments' proposal would be ineffective to accomplish the goal of giving unitholders the right to nominate directors for election to the Board of Directors.

In addition, Q Investments' proposal does not require that any unitholder intending to nominate potential directors for election to the Board of Directors provide any advance notice of, or any

Cedar Fair Entertainment Company – One Cedar Point Drive, Sandusky, Ohio 44870-5259 419-627-2233

Cedar Fair Files Preliminary Proxy Statement

For Requested Special Meeting of Unitholders

March 29, 2011

Page 2

information with respect to, such nominee. The fact that Q Investments' proposal lacks any basic procedural or informational requirements means that nominations could be made in a disorganized manner that is not in the best interests of unitholders. As a result, the Board of Directors recommends a vote "AGAINST" Q Investments' proposal.

However, the Board of Directors understands unitholders may desire to have the right to nominate potential directors for election to the Board of Directors. Therefore, and as an alternative to Q Investments' proposal, the Company is putting two proposals on the agenda for this upcoming Special Meeting that, if approved, would give the unitholders the right to nominate directors for election to the Board of Directors in a manner that is consistent with the applicable governance structure of Cedar Fair and its General Partner. Specifically, the two proposals by the Company are (i) an amendment to the regulations of the General Partner to permit the limited partnership agreement to include a provision giving unitholders the right to nominate potential directors for election to the Board of Directors and (ii) an amendment to the limited partnership agreement to establish certain procedures and information requirements pursuant to which unitholders can nominate potential directors for election to the Board of Directors.

The Company has offered these proposals in order to provide unitholders with an opportunity to vote on proposals that are compliant with the governance structure of Cedar Fair and its General Partner and that, if approved, would effectively establish the right of unitholders to nominate directors for election to the Board of Directors in an orderly, organized and uniform manner.

About Cedar Fair

Cedar Fair is a publicly traded partnership headquartered in Sandusky, Ohio, and one of the largest regional amusement-resort operators in the world. The Company owns and operates 11 amusement parks, six outdoor water parks, one indoor water park and five hotels. Its parks are located in Ohio, California, North Carolina, South Carolina, Virginia, Pennsylvania, Minnesota, Missouri, Michigan, and Toronto, Ontario. Cedar Fair also operates the Gilroy Gardens Family Theme Park in California under a management contract. Cedar Fair's flagship park, Cedar Point, has

Cedar Fair Entertainment Company – One Cedar Point Drive, Sandusky, Ohio 44870-5259 419-627-2233

Cedar Fair Files Preliminary Proxy Statement

For Requested Special Meeting of Unitholders

March 29, 2011

Page 3

been consistently voted the "Best Amusement Park in the World" in a prestigious annual poll conducted by Amusement Today newspaper.

Additional Information

This may be deemed to be solicitation material in respect of the proposals described in the preliminary proxy statement on Schedule 14A, filed by the Company on March 29, 2011. In addition, the Company will file with, or furnish to, the Securities and Exchange Commission (the "SEC") all relevant materials, including a definitive proxy statement on Schedule 14A (when available). BEFORE MAKING ANY VOTING DECISION, INVESTORS AND SECURITY HOLDERS OF THE COMPANY ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH OR FURNISHED TO THE SEC, INCLUDING, THE PRELIMINARY PROXY STATEMENT ON SCHEDULE 14A FILED BY THE COMPANY ON MARCH 29, 2011 AND, WHEN AVAILABLE, THE DEFINITIVE PROXY STATEMENT ON SCHEDULE 14A, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSALS. The definitive proxy statement on Schedule 14A (when available) will be mailed to unitholders of the Company. Investors and security holders will be able to obtain a copy of the preliminary proxy statement, definitive proxy statement (when available) and other documents filed by the Company free of charge from the SEC's website, www.sec.gov. The Company's unitholders will also be able to obtain, without charge, a copy of the preliminary proxy statement, the definitive proxy statement (when available) and other relevant documents by directing a request by mail or telephone to Investor Relations, Cedar Fair, L.P., One Cedar Point Dr., Sandusky, OH 44870, telephone: (419) 627-2233, or from the Company's website, www.cedarfair.com, or by contacting Morrow & Co., LLC, at (203) 658-9400 or toll free at (800) 206-5879.

The Company and its directors and executive officers and certain other members of its management and employees may be deemed to participate in the solicitation of proxies in respect of the proposals. Additional information regarding the interests of such potential participants is included in the proxy statement.

###

Cedar Fair Entertainment Company – One Cedar Point Drive, Sandusky, Ohio 44870-5259 419-627-2233...

http://www.sec.gov/A...83/ddefa14a.htm