Q Funding wants two new board members for Cedar Fair

Posted Thursday, April 29, 2010 12:51 PM | Contributed by Jeff

Q Funding has filed a letter with the SEC, sent to the Cedar Fair board of directors, announcing its intent to nominate two new board members prior to the June meeting.

Read the filing as posted to the Securities and Exchange Commission Web site.

Thursday, April 29, 2010 12:53 PM

And there was cheering throughout the land. The way the vote went for the acquisition, I can't imagine they would have a problem getting votes for these new members.

Thursday, April 29, 2010 1:13 PM

Is there any possibility of a new chairman of the board?

Last edited by mwatts, Thursday, April 29, 2010 1:14 PM
Thursday, April 29, 2010 1:27 PM

You need to start with the Directors. Unless Dick steps down his yes men on the Board are going to protect him. Getting some contrary points of view on the Board won't necessarily turn the tide but it will make things more difficult...to be sure.

Thursday, April 29, 2010 1:46 PM

I'll start printing the picket signs... Does anyone want to have a Poster-board and Tempura Paint Party?

Thursday, April 29, 2010 5:00 PM

Clap, cheer and stomp your feet folks! The end of the nightmare is starting to come into focus....just give it some time. Kinzel & Co. need to take a look over their shoulder at where Burke & Co. are today, that's your future guys!

Friday, April 30, 2010 11:45 AM

It's also good they're using an executive recruiting firm to find possible candidates and aren't just hand picking nominees of their own.

Friday, April 30, 2010 11:50 AM

Interestingly enough, of the three seats coming open, they're not going after Dick's:


Interesting that they'd like to play nice, for now.

Friday, April 30, 2010 2:05 PM

I smell something wonderful cooking in the bait and switch department... when are more seats open beyond these three?

Friday, April 30, 2010 4:47 PM

Can't say I know a lot about the function of Corporate Boards but my best guess is that going after the big guy (most visible...lots of history) might actually sabotage their chance of getting anyone on the Board. Dick's defenders would certainly come out in force and his long standing tenure...though marked by more failures than successes in the last few years in my opinion...might carry enough emotional attachments that it would be a difficult fight.

Going after lesser known Board members (heck...I'm not sure I could name more then 3 others off the top of my head) may be more palatable to the folks who will actually vote. So, if they can get two on the Board then they are in a position of influence.

Saturday, May 1, 2010 1:38 AM

No matter what happens with the board, they have to deal with Dick. He is a long-serving board member, longtime CEO, and for the moment at least he has contractual agreements with FUN. The man is in over his head, I'll agree...but he isn't stupid, and he has a great deal of experience with the company, enough to have a few good insights as to what seems to work, what doesn't, and why the company does some of the things that it does. He also has a fair amount of influence with the rest of the board. I would expect that at this stage, Q Funding would prefer to have him as an ally if that is at all possible.

Give the man an opportunity to adapt, to steer the company in the right direction so that he can retire comfortably. Even make him think some of the better ideas were really his all along. :)

The way I see it, Q is better off letting DK feel like he is running the show. If things work out, that's great. And if things fail to improve, it makes a stronger case for laying the blame on him.

--Dave Althoff, Jr., who, so far as he knows, holds 0 units of FUN.

Saturday, May 1, 2010 2:22 AM

Warm fuzzies have no place for a man who has erased millions of dollars in unit holder value. Zero. It's not personal, it's business. His experience is with a different company in a different time, not the Cedar Fair of today. The time for replacing him has long since passed.

Saturday, May 1, 2010 9:22 AM

I have to agree with Jeff. One of the reasons Cedar Fair is in the position it is in is because Dick has NOT adapted. Give him more time? I don't think so. Just as with Eisner at Disney...he was right for Cedar Fair 10-15 years ago.

But, the company has outgrown him.

Saturday, May 1, 2010 3:14 PM

It isn't about warm fuzzies, it's about politics. Q is going after two seats on a 7-member board. Even if they get the man off the board, he's still the board-appointed President and CEO, and quite frankly, I suspect he does more damage there than he does sitting on the Board. He is positioned so that the easiest way to get him out of the way is to convince him that the company will be fine without him running it. At the moment, from what I read and hear, I have my doubts as to whether there are four board members who would agree on that point without his say-so. I suspect that for political reasons it will be easier to get him to step down as President and CEO if he is not forced off the board first.

Like it or not, and whether he deserves it or not, when Kinzel retires he's going to do it "with punch and cake"*. Regardless of what he's done for/to shareholder interests, he's gone to great lengths to preserve his own.

--Dave Althoff, Jr.

* Where I work, you can tell who gets fired and who simply moves on or retires: people who are fired usually don't get a farewell reception.

--DCAjr (again, outside observer with 0 units)

Saturday, May 1, 2010 5:10 PM

I don't really see how any of your points are relevant to your earlier post indicating he had some value left to the company.

Saturday, May 1, 2010 8:02 PM

I hate to throw water on the celebration, but why, exactly, do we think that Q would put people on the board who would continue to reinvest in the parks as opposed to squeeze every possible dollar out of them?

I mean, investment trusts are not exactly known for being long term players in the companies that they take stakes in. Flip and sell is much more likely than invest for the future.

Maybe Q will insist on directors that have the long term interests of the company--and, by extension, its parks--in their hearts, but cutting the capex budget is waaayyyyy more likely.

Face it, CF is now "in play." As long as its future is unsettled, long term planning will be secondary to who can sell it for the best price. And that probably means NOT spending $20m per coaster/$80m per year.

Saturday, May 1, 2010 11:36 PM

You don't have to watch the industry long to understand that heavy cap ex is important, and I don't see any reason why someone would think otherwise. Cedar Fair already runs far leaner than any of the other big amusement operators. There just ain't much more to cut.

Now choosing what to invest in, that's a different story. I still think, however great it might have been for coaster nerds, that Behemoth was totally unnecessary, and I wonder if it really gives Canada's Wonderland a long-term boost. I'm not sure the Carowinds ride was necessary either. Dominion definitely needed 305 to announce to DC that it wasn't screwing around. I'd like to see these kinds of decisions made with far more scrutiny.

Saturday, May 1, 2010 11:45 PM

Hell, I'd be happy if they'd start serving food that isn't pure garbage.

Not only is it expensive, it's crap. Often cold crap.

Last edited by pkidelirium, Saturday, May 1, 2010 11:46 PM
Sunday, May 2, 2010 12:20 AM

Jeff said:
You don't have to watch the industry long to understand that heavy cap ex is important, and I don't see any reason why someone would think otherwise. Cedar Fair already runs far leaner than any of the other big amusement operators. There just ain't much more to cut.

Most investment trusts are in and out in a couple of years or less. To them eliminating capex is an extra $80m in cash per year. They could care less about the long term.

Jeff said:
Dominion definitely needed 305 to announce to DC that it wasn't screwing around.

A perfect example of an expenditure that a short-term operator would NEVER have made.

I'm not saying Q will gut the company, but until we know who they want on the board and what they want the board to do, it is at least as likely to be bad for the parks long term as not.

BTW, aren't you the one that says current management scrutinizes everything with regard to ROI?

Sunday, May 2, 2010 12:49 AM

First off, two board members aren't a majority, second, my point was that you're completely wrong about how cutting cap ex makes them more money. If attendance and spending slides because they don't spend any money on shiny stuff, how do you expect a build-and-flip? That doesn't make sense.

And yes, they measure ROI for everything. So what? I happen to think that throwing roller coasters at every park is not a sure thing anymore. I mean, look at Dorney... how over-built is that park?


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