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What the heck is going on at Magic?

RustyGroomer

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That's cool but $400? Plus $125 shipping?? No thank you. Anyone plan on being up there Saturday? No idea what to expect but i'll be there anyway.
 

skithetrees

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But I still think it seems odd for folks to "donate" to a private company like this with no expectation of anything in return. I thought that folks bought "shares" with the intent of having some control over the area? Is that no longer the case?

'Unforeseen' legal costs sunk the shareholder model. Essentially, the shareholder model triggered provisions of securities laws and thereby certain legal requirements in each state where a member resided. Compliance costs would have been in the six figures allegedly. When you seek to raise around one million dollars, that is thought to swallow. Law school 101 that a lawyer should have foreseen.

As a result, the model changed to a 'club' with marginal benefits of being a member at best. People were offered their money back, some took it others didn't. Generalizing, many of the people who stayed in were homeowners with a vested interest in the mountain succeeding and realized that their money was in essence a donation to JLS with no real protections.
 

deadheadskier

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But I still think it seems odd for folks to "donate" to a private company like this with no expectation of anything in return. I thought that folks bought "shares" with the intent of having some control over the area? Is that no longer the case?

Smaller scale, but we have a small music club in town, The Stone Church that often struggles financially. In our six years living here they are now on its third set of owners. But, its an amazing club to see live music in; been around since 1969 and has seen some amazing musicians play there. Phish used to play there back in the day. When you buy tickets to shows, there is an option to pay a little extra to support the club. I always kick in a few extra bucks every time I go to a show. The only "benefit" I receive is knowing I'm helping keep a place alive that has brought me and others so much joy. I assume the logic behind those who have donated to Magic is much the same.


If that makes me a "sucker" I don't really care.
 

thetrailboss

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'Unforeseen' legal costs sunk the shareholder model. Essentially, the shareholder model triggered provisions of securities laws and thereby certain legal requirements in each state where a member resided. Compliance costs would have been in the six figures allegedly. When you seek to raise around one million dollars, that is thought to swallow. Law school 101 that a lawyer should have foreseen.

As a result, the model changed to a 'club' with marginal benefits of being a member ats best. People were offered their money back, some took it others didn't. Generalizing, many of the people who stayed in were homeowners with a vested interest in the mountain succeeding and realized that their money was in essence a donation to JLS with no real protections.

Securities laws are VERY complicated and easy to blow if you're not careful. From what I understand the issue was, as you put it, that he sold to folks out of state and thus interstate commerce occurred triggering federal securities laws. Something that a lawyer probably could have foreseen....and maybe should have sought advice before trying to do it himself.
 

thetrailboss

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Smaller scale, but we have a small music club in town, The Stone Church that often struggles financially. In our six years living here they are now on its third set of owners. But, its an amazing club to see live music in; been around since 1969 and has seen some amazing musicians play there. Phish used to play there back in the day. When you buy tickets to shows, there is an option to pay a little extra to support the club. I always kick in a few extra bucks every time I go to a show. The only "benefit" I receive is knowing I'm helping keep a place alive that has brought me and others so much joy. I assume the logic behind those who have donated to Magic is much the same.


If that makes me a "sucker" I don't really care.

For the record I'm not calling anyone a "sucker". ;) I know that you probably were responding to another poster who is about four hours north of me right now.

That said, I think that you're example is much different than what happened with Magic. A few bucks here and there with the understanding that you're donating it is different than soliciting $3,000 from several hundred people with the understanding that the money will be invested into the area with the investor/contributor getting a say in the operation as a quasi-owner as well as other benefits including discounts, etc. Now I guess they are getting nothing even though they met the stated sales goal.

For your example the folks at least might be able to claim it as a tax deduction if it was a non-profit or charitable organization. These folks, on the other hand, lost $3,000 completely. Granted there was no guarantee and, from what I understand, JLS has offered a refund But there is some potential trouble for JLS considering what has happened.
 

thetrailboss

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That's cool but $400? Plus $125 shipping?? No thank you. Anyone plan on being up there Saturday? No idea what to expect but i'll be there anyway.

Yeah now that you mention it I recall seeing this crazy price when he first listed it; looks like he is putting it up for bid at much less though.
 

deadheadskier

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Definitely not a charitable organization regarding the Stone Church. If I had to guestimate the amount I've donated to them, it's probably in the neighborhood of $500 over the past 4 years since they've added that option to the online ticket purchasing platform. The current owner (also our town state Representative) has been able to keep the business going during that time. I'd hate to ever see a day where Newmarket didn't have it's Stone Church. It was closed for several months during one lapse of ownership and it really sucked. It's the artistic identity to our little town. Losing it, would be like Burlington, VT losing the Flynn theater.

I don't know what the initial "investors" to Magic were expecting in return regarding a say in the operation. Are some folks asking for a refund in light of their recent problems? I guess I haven't been following it closely.
 

thetrailboss

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Definitely not a charitable organization regarding the Stone Church. If I had to guestimate the amount I've donated to them, it's probably in the neighborhood of $500 over the past 4 years since they've added that option to the online ticket purchasing platform. The current owner (also our town state Representative) has been able to keep the business going during that time. I'd hate to ever see a day where Newmarket didn't have it's Stone Church. It was closed for several months during one lapse of ownership and it really sucked. It's the artistic identity to our little town. Losing it, would be like Burlington, VT losing the Flynn theater.

I don't know what the initial "investors" to Magic were expecting in return regarding a say in the operation. Are some folks asking for a refund in light of their recent problems? I guess I haven't been following it closely.

From the POWDER article, it says that JLS has offered refunds to some of the members; some are saying no thank you.
 

gladerider

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wow, i can't believe i read the entire thread on one sitting. interesting development indeed. i like magic, hope it continues operation.
i tend to agree with abc's assessment. looks like just internal change of hands.

i think the regulators are involved for two reasons.
1- there are strict rules and regulations in this country whenever you are raising money outside of your friends and family network, especially when there are equities involved. it seems that JLS may not have followed these rules. whether there was an embezzlement or not, this could be an issue with the SEC
2- whenever you raise money from outside of your family and friends network using a legal entity to do X and spend the money to do anything other than X, you may have embezzlement allegations, which is a separate issue from #1 above

my 2cents
 

RustyGroomer

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Well a sucker is born every day now aren't they.
If a sucker is believing & supporting in a place I call my home away from home for most of my life,....YES I'm proud to be one of the biggest suckers in this whole mess. Thanks for the jab though.
 

Tin

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Well a sucker is born every day now aren't they.

It is a special place that I hope is still around when I have a family. This isn't about "suckers" donating money it is about keeping an amazing place alive. If I won Powerball tomorrow I would get involved and help out as much as possible.
 

MadMadWorld

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It is a special place that I hope is still around when I have a family. This isn't about "suckers" donating money it is about keeping an amazing place alive. If I won Powerball tomorrow I would get involved and help out as much as possible.

I definitely get it too. I think I would just be a little upset about being mislead or kept in the dark about how the money was being spent. Like RG said, I think there would have been plenty of people willing to offer up a donation if that is what everyone was told
 

RustyGroomer

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I think I would just be a little upset about being mislead or kept in the dark about how the money was being spent.
You’d have every right to be. We were/are very upset. We also realized it does not help things one bit. I’ll be up there this weekend volunteering my time. That does.
 

drjeff

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Well Magic should have a bunch of racers there on at least 5 Sundays this coming season. The schedule for the Southern VT Council (of which Magic is a part of) youth races was just released, and they're hosting on the following Sundays (January 18th, February 8th, February 15th, March 8th and March 22nd). There may be another race added in Early March as some of the state championship races location have yet to be determined. Add in the spectator/parents to the racer and coaches tickets and that should be somewhere between 800 to 1000 tickets sold for Magic this year :)
 

Smellytele

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Well Magic should have a bunch of racers there on at least 5 Sundays this coming season. The schedule for the Southern VT Council (of which Magic is a part of) youth races was just released, and they're hosting on the following Sundays (January 18th, February 8th, February 15th, March 8th and March 22nd). There may be another race added in Early March as some of the state championship races location have yet to be determined. Add in the spectator/parents to the racer and coaches tickets and that should be somewhere between 800 to 1000 tickets sold for Magic this year :)
I know which days not go there.
 

Savemeasammy

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I know which days not go there.

Haha. I was thinking the same thing! I was at magic on a race day last year. They were all in the lodge at the same time having lunch, and then they all went outside at the same time to get back on the lift. I don't get it... Of course we finished just after and had to wait in line with them!

To be fair, the line was short the rest of the time.


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Savemeasammy

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You’d have every right to be. We were/are very upset. We also realized it does not help things one bit. I’ll be up there this weekend volunteering my time. That does.

Believe me, there are plenty of us who appreciate that the Magic loyalists have done what they can to keep it afloat. I'd be happy to help on a volunteer day at some point if the stars line up...

Ignore the D.B. comments from others. No one cares.


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drjeff

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Haha. I was thinking the same thing! I was at magic on a race day last year. They were all in the lodge at the same time having lunch, and then they all went outside at the same time to get back on the lift. I don't get it... Of course we finished just after and had to wait in line with them!

To be fair, the line was short the rest of the time.


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yup, alll depends on the format of the race and if they do/don't reset the course for the 2nd run on how the lines go on race day. Usually, especially if the Red is running, the racer line is worst right at 1st chair as all the athletes and coaches are headed up at the same time for course inspection, and then after that quickly the pack of racers spreads out and the line quickly shortens. If they reset for the 2nd run, then around lunchtime typically, you'll get another big surge of all the athletes heading back up at the same time for inspection of the 2nd run course
 

RustyGroomer

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Believe me, there are plenty of us who appreciate that the Magic loyalists have done what they can to keep it afloat. I'd be happy to help on a volunteer day at some point if the stars line up...

Ignore the D.B. comments from others. No one cares.


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Hope to see you there! I've been ignoring d00shbag comments for years. This is no different.
 
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