killington cancelling lifetime passes

[jerryg]

Pretty soon it will be "Earth faces day of the apocalypse; revoked lifetime passes to blame". It's probably running across the tickler in Times Square right now.

Admit it...we really do have a shortage of worthwhile news for all the outlets and talking heads to discuss.

We reached that threshold with Anna Nicole Smith stories or Tomcat, but yes, you are correct.

 

[thetrailboss]

Pretty soon it will be "Earth faces day of the apocalypse; revoked lifetime passes to blame". It's probably running across the tickler in Times Square right now.

Admit it...we really do have a shortage of worthwhile news for all the outlets and talking heads to discuss.

Some of that bad PR that IIRC you said was never going to leave the chatrooms. :wink: Rutland Herald, AP, and now Boston Globe. Only upside for POWDR/SP is that it is Friday afternoon and most folks know that the "bad news" comes out now because nobody is paying attention.

 

[JimG.]

Some of that bad PR that IIRC you said was never going to leave the chatrooms. :wink: Rutland Herald, AP, and now Boston Globe. Only upside for POWDR/SP is that it is Friday afternoon and most folks know that the "bad news" comes out now because nobody is paying attention.

trailboss, I never said that either...I said nobody would care and because nobody would care that it would not seriously effect Killington skier visits. It's not bad press unless there is a significant group of individuals who agree it's really bad.

So far, I've seen no uprising of more than usual anti-Killington sentiment; in fact, POWDR/SP did figure one thing out...nobody is bitching about Killington not staying open until June like we usually hear endlessly right about now.

So give them some credit!

 

[riverc0il]

I will concede to Mr. bobbutts that the in print media has picked up the story. I still doubt there is going to be much fall out regarding the general skiing population... especially if someone researches the issue and finds out what is really going on. Let's keep in mind that the season pass was a "benefit" as part of an investment. Also of note is that Powdr is allowing stake holders to have two more seasons of free passes. I would be surprised if many people are not breaking even if not having made back a good deal of their investment based on the season pass alone.

 

[Breeze]

late to the table but have been listening,and don't have a dog in the fight.

Playing Devils advocate here, so take that into your consideration from whatever avenue you approach. Client/consumer relations should never be a dead end for any business, if you need to give bad news, be prepared to suck it up down the road.

Why would the new Owners of K stand still for discounted season passes being sold up and down the access road ( off premise and out of K's control)? Does K get ANY bucks for maintaining their database, collecting the signatures for liability release and disclosure of terms? It is the resort that has to stay on top of paperwork, not the seller of the transferrable pass. Where is the "agency" if the pass is transferred in a private sale? Is the seller going to get a liability waiver from the buyer?? or will that devolve to the Resort?

It is not just free skiing at the heart of the matter.

I'm sympathetic to both sides of this issue. I Hope it works out amicably, K probably has some wiggle room but are testing their limits.

Keep on keeeping on, If you are negatively affected, don't give up the ship. Present your case.

Breeze

 

[Lostone]

K-Mart will not make a penny off canceling the lifetime passes unless some of the people that own those passes buy tickets or passes there.

If those people take their business elsewhere, the only thing that K-mart would have gained is the PR.

I agree that they are known as a resort that is known for bad customer service, but I would think someone buying the resort would want that not to be the case, for their reign.

 

[MikeTrainor]

Some of that bad PR that IIRC you said was never going to leave the chatrooms. :wink: Rutland Herald, AP, and now Boston Globe. Only upside for POWDR/SP is that it is Friday afternoon and most folks know that the "bad news" comes out now because nobody is paying attention.

It is now the 3rd most emailed story, so I guess it is of interest to the general population. I guess it is to their advantage to get it out now since most people will not likely remember it or care come November.

 

[threecy]

I've read a few difference articles now and it was not ASC, it was indeed Powdr who did this and feel that they are being generous in giving the 2-year exptension. They claim that lifetime is equal to lifetime of the previous corporation or something silly.

This won't cost them all that much money, but it WILL be bad for PR. uke:

From the post of the passholder agreement earlier in this thread, I read that as lifetime of the corporation. If I were a passholder, I'd try to read it as my lifetime...but even that doesn't matter, if you're able to transfer it! Keep the pass till you're 70, then transfer it to your 4 year old grandchild!

The buyer should not have to pay the consequences of a poor business decision by a corporation that has been dissolved.

Again, this was NOT a stock transfer! ASC owned the corporation and was paid cash for the assets. As a result, they assume certain liabilities for their time in charge. If I were a passholder, I would be going after them, not Powdr, for not ensuring my pass would continue.

 

[bill2ski]

Q ;

" How do you know when the property next door has been bought by someone from away?

A ;

They build a fence

 

[jerryg]

From the post of the passholder agreement earlier in this thread, I read that as lifetime of the corporation. If I were a passholder, I'd try to read it as my lifetime...but even that doesn't matter, if you're able to transfer it! Keep the pass till you're 70, then transfer it to your 4 year old grandchild!

The buyer should not have to pay the consequences of a poor business decision by a corporation that has been dissolved.

Again, this was NOT a stock transfer! ASC owned the corporation and was paid cash for the assets. As a result, they assume certain liabilities for their time in charge. If I were a passholder, I would be going after them, not Powdr, for not ensuring my pass would continue.

Except they were not paid cash for this particular asset. In the initial 14c, it outlines every asset and how much was being paid for it. The only difference in the cost from that statement (Where it noted that the Buyer had to honor the passes) was $2.9 million for taxes and closing costs.

 

[threecy]

Except they were not paid cash for this particular asset. In the initial 14c, it outlines every asset and how much was being paid for it. The only difference in the cost from that statement (Where it noted that the Buyer had to honor the passes) was $2.9 million for taxes and closing costs.

I'm referring to the overall transaction, which is "the sale of the Killington and Pico ski areas to SP Land Company, LLC for cash consideration of $83.5 million"

It amazes me how people still seem to be mad at Powdr and not ASC. Remember, up until the paperwork is signed, it is the duty of ASC to do what's in the best interest of their shareholders. Thus, not ensuring certain provisions of lifetime passholders (some of whom are shareholders apparently), is ASC's problem, NOT Powdr's.

 

[jerryg]

I'm referring to the overall transaction, which is "the sale of the Killington and Pico ski areas to SP Land Company, LLC for cash consideration of $83.5 million"

It amazes me how people still seem to be mad at Powdr and not ASC. Remember, up until the paperwork is signed, it is the duty of ASC to do what's in the best interest of their shareholders. Thus, not ensuring certain provisions of lifetime passholders (some of whom are shareholders apparently), is ASC's problem, NOT Powdr's.

So then why would they put into the contract that the lifetime passes were to be honored? That has to be amended after it is filed with the SEC. If it is amended, it is by BOTH parties. We don't know what the final paperwork says, but SP/Powdr may just have decided to do this. Who's to say ASC even knew? You don't know that. The final paperwork may have been signed by them or SP prior to the 10th. The legal date is the 11, which was also the SEC filing date, but such minor thing (Financiall, between the Buyer and Seller) could have easily been overlooked if someone wanted to play dirty.
And since when would it matter if it was up to ASC to do what's in the best interest of shareholders? I doubt they really care outside of the preferred shareholders, who are on the board.
All that being said, if this was done to benefit ASC, then two things would not have been included in the same contract.
1.) the sale price of $83.5
and
2.) the covenant that says the Buyer is to honor the lifetime passes.
If ASC planned to disolve the agreement themselves, there would have been further cash consideration, which there was not. In NO WAY has this been beneficial to ASC.

You're right, it may very well not be Powdr who is to blame, it may be SP or it may even be Killington Mgt. (A. Smith) without the consideration of any other party.

Who knows? Maybe some laws were even broken! Wow!

 

[threecy]

It's still hard to exactly what happened here, but a) ASC must have had some knowledge the passes wouldn't be honored anymore since they sent the letter and b) Powdr must have some legal standing to be willing to do this.

A corporation must do what's best for all of its shareholders, not just preferred shareholders.

Again, based upon what I've seen, I don't think the new owners should be blamed. I think, of the two parties, ASC holds more responsibility in this issue.

That said, the blame should be put on the industry in general. Due in part to the seasonality of the business, the northeast ski industry doesn't think too far ahead - it gives away way too many vouchers, too many coupons, and too many poorly thought out passes.

 

[jerryg]

It's still hard to exactly what happened here, but a) ASC must have had some knowledge the passes wouldn't be honored anymore since they sent the letter and b) Powdr must have some legal standing to be willing to do this.

A corporation must do what's best for all of its shareholders, not just preferred shareholders.

Again, based upon what I've seen, I don't think the new owners should be blamed. I think, of the two parties, ASC holds more responsibility in this issue.

That said, the blame should be put on the industry in general. Due in part to the seasonality of the business, the northeast ski industry doesn't think too far ahead - it gives away way too many vouchers, too many coupons, and too many poorly thought out passes.

I fully understand where you are coming from, I just disagree, which I suppose is part of the reason topics are discusses. As for who is behind this, Powdr has said they are the ones who terminated the passes. ASC cannot be blamed for that. All the articles are the same, with the guy from Powdr defending their position.

 

[BeanoNYC]

Sounds like a pyramid scheme that collapsed...not that it is, but some innocent people are left holding the bag.

 

[kbroderick]

K-Mart will not make a penny off canceling the lifetime passes unless some of the people that own those passes buy tickets or passes there.

...which probably will happen, assuming that there is a large number of folks buying the yearly-transferable passes from access road business owners and the like. Given what we've heard on this thread so far, the passholders seem to be:
a) people who invested in the company a long time ago and were issued passes as a benefit of that investment (also a while back), many of whom sell the transferable benefit for profit each year (at a price below Killington's early-season price)
b) people who invested but have kept the pass benefit for themselves or their family
c) people who have more recently purchased the pass benefit for long-term personal use

I'd guess that groups (b) and (c) are the ones most likely to be annoyed (particularly group c), as group a should have already made plenty of profit and be looking at this from a business perspective. I'd have to guess that Powdr would've considered honoring the passes if it was just the latter groups. However, group a is operating in direct competition with Powdr except that they have virtually no overhead; if the numbers theorized elsewhere in this thread are at all accurate, then the money brought in by group a--money that most likely will go to Powdr in the form of pass or ticket sales once those lifetime passes cannot be resold--is significant and probably outweighs the annoyance caused to groups b and c.

 

[lifetimeskier]

Killington Lifetime passes

I would like to know if JimG, "the moderator" works for or is in any way compensated by Killington.
This (SP Land/Powdr and ASC) is reminding me of a company that makes a product they know will hurt people. Their analysis shows them they will earn $20 million in profits and only have to pay out $2 million in lawsuits, so they go ahead and make/sell the harmful product. Is that ethical behaviour, that should be justified as good business?
It was SP Land Co/Powdr's choice to not honor the lifetime passes (ones which the holders certainly seem to have been led to believe went with their lifetime and not the lifetime of Sherburne Corp which hasn't really existed in a long time). It was certainly no secret that the passes exist. Killington ski area may never have gotten off the ground without such passes. Maybe SP Land/Powdr should have paid ASC less $ for Killington and behaved in a responsible/good faith manner as their first step, if they felt the passes were a costly liablity. Maybe SP Land/Powdr should go after the $3 million held in escrow and honor their obligation to the passholders. Maybe if the language in the SEC filed Purchase agreement had not stated that the lifetime passes would be honored, many of us would have asked more questions earlier and gotten involved in the transfer of the land lease with the State of Vermont.
How insulting to these loyal Killington people to drop this bomb, then say in the letter, if you have any questions call the season pass office which isn't open until August. I have tried to call Killington, but I can't get anyone (they are on vacation for a month), except in sales and reservations. Even though I did leave a message for Chris Nyberg (who is physically present in Killington), he has not returned my phone call.
The ski community is very linked around the country, if not the world, and SP Land/Powdr seems to have underestimated the passion many of us have for the sport. Of course word would spread of SP Land/Powdr's bad faith. Here in VT there are several other decent ski areas ~ an hour's drive from Killington. Many of us will ski at the other areas, as will the family and friends who used to come here and buy tickets or passes because we skied at Killington.

 

[BeanoNYC]

I would like to know if JimG, "the moderator" works for or is in any way compensated by Killington.

LMAO. If Jim has skied KMart 2 times this season, thats a lot. He's a Hunter faithful. Don't mistake his candidness for bias.

 

[thetrailboss]

The ski community is very linked around the country, if not the world, and SP Land/Powdr seems to have underestimated the passion many of us have for the sport. Of course word would spread of SP Land/Powdr's bad faith. Here in VT there are several other decent ski areas ~ an hour's drive from Killington. Many of us will ski at the other areas, as will the family and friends who used to come here and buy tickets or passes because we skied at Killington.

This is similar to my POV as well. Why do you punish loyal customers? Without customers, or $$$, there is no company.

 

[threecy]

I would like to know if JimG, "the moderator" works for or is in any way compensated by Killington.
This (SP Land/Powdr and ASC) is reminding me of a company that makes a product they know will hurt people. Their analysis shows them they will earn $20 million in profits and only have to pay out $2 million in lawsuits, so they go ahead and make/sell the harmful product. Is that ethical behaviour, that should be justified as good business?
It was SP Land Co/Powdr's choice to not honor the lifetime passes (ones which the holders certainly seem to have been led to believe went with their lifetime and not the lifetime of Sherburne Corp which hasn't really existed in a long time). It was certainly no secret that the passes exist. Killington ski area may never have gotten off the ground without such passes. Maybe SP Land/Powdr should have paid ASC less $ for Killington and behaved in a responsible/good faith manner as their first step, if they felt the passes were a costly liablity. Maybe SP Land/Powdr should go after the $3 million held in escrow and honor their obligation to the passholders. Maybe if the language in the SEC filed Purchase agreement had not stated that the lifetime passes would be honored, many of us would have asked more questions earlier and gotten involved in the transfer of the land lease with the State of Vermont.
How insulting to these loyal Killington people to drop this bomb, then say in the letter, if you have any questions call the season pass office which isn't open until August. I have tried to call Killington, but I can't get anyone (they are on vacation for a month), except in sales and reservations. Even though I did leave a message for Chris Nyberg (who is physically present in Killington), he has not returned my phone call.
The ski community is very linked around the country, if not the world, and SP Land/Powdr seems to have underestimated the passion many of us have for the sport. Of course word would spread of SP Land/Powdr's bad faith. Here in VT there are several other decent ski areas ~ an hour's drive from Killington. Many of us will ski at the other areas, as will the family and friends who used to come here and buy tickets or passes because we skied at Killington.

Just so its out in the open, I have never worked (nor currently work) for Killington, ASC, or SP/Powdr. Quite frankly, Killington is one of my least favorite ski areas.

Yes, it's a rotten situation. However, it appears there is language in the contracts/agreements that allow SP/Powdr to make a conclusion that they are not under an obligation to honor these passes. In addition, the language is strong enough to allow ASC to confirm this in the form of the letter they sent out.

Let's assume SP/Powdr cannot be legally forced to honor or refund these passes.

Which ethics are more important - honor passholders passes that SP/Powdr never sold or collected compensation from or honor shareholders who would otherwise be forfeiting millions of dollars worth of services.

If SP/Powdr honors these passes (again, previous assumption in place), the value of skiing at Killington drops. Some paying passholders will be unhappy that others are getting free or heavily (if that bit about people reselling their lifetime passes every year is true) discounted passes. Shareholders will be unhappy that they are giving away millions of dollars of skiing for nothing. Those who have the lifetime passes and are mad at SP/Powdr will still be mad at SP/Powdr and will still badmouth them.

If SP/Powdr doesn't honor those passes, many who wouldn't be paying SP/Powdr for season passes still won't and will ski elsewhere. Others will buy a normal priced pass after the free period expires. Paying passholders will not feel that their getting as bad of a deal in comparison to 'freebies.' Shareholders will be happy that they are getting compensated for the product they sell. Those who have the lifetime passes and are mad at SP/Powdr will still be mad at SP/Powdr and will still badmouth them.

If I were SP/Powdr, I'd go with option 2.