Board of Trustees Meeting Minutes July 15, 2006





 Mad River Glen Cooperative
Board of Trustee’s Meeting
Minutes – Saturday July 15, 2006


After due notice, a meeting of the board of trustees of the Mad River Glen Cooperative was convened at 8:07 a.m. on July 15, 2006 on the 3rd floor of the Basebox at Mad River Glen Ski Area (“MRG”) in Fayston, Vermont.
Trustees Jay Appleton, Paul Finnerty, Jed Kalkstein, Steve Mackenzie, Rick Moulton, Bill Reynolds, and Eric Schoenholz were present. Absent, Geordie Hall and Mary Schramke. Also present was President Jamey Wimble, and several shareholders. Board Member Emeritus Deb Steins took the minutes.

Jay Appleton, chair, called the meeting to order at 8:07 a.m.


Upon motion duly made by Jed Kalkstein and seconded by Steve Mackenzie it was unanimously
Voted: To approve the minutes of the May 20, 2006 board of trustees’ meetings.


SHAREHOLDER COMMENTS – none at this time.


A brief discussion ensued concerning the possible 17+ shares that are on the list for redemptions and the impact on the financials. This will be discussed at the September meeting.
The management report is attached for reference.


Net ordinary Income is expected to be approximately ($250,000) at year end. The current financial report looks worse than expected because there are various expenses currently in the P/L that will be moved to the balance sheet. It was noted that all single chair grants must be taken as Coop income; however they will be offset next year by the Net Losses from prior years, which will help future tax reporting.

The financial report is attached for reference.


The executive committee authorized Jamey Wimble to sign the contract with Doppelmayr/CTEC and to pay the initial deposit.


Covenant to Preserve the Single for 50 years with Preservation Trust of Vermont (PTV) – Bill Reynolds reported that in a 7 to 1 vote, the Single Chair Campaign Committee recommended to the board that the board approve the documents as presented. He highlighted that the covenant is restricted to the critical elements of the single – the chairs, towers above tower three, the top elements and the 100 ft corridor under the chair; MRG retains the right to alter all other elements of the single and the other mountain components thus retains flexibility on all other aspects of mountain operations. The committee concluded that the covenant is consistent with our strategic plan. The concern with the length of the covenant is covered by the termination clause. Should there be an excessive financial burden exerted by the continued operation of the single chair, the termination clause lays out a process for MRG and PTV to work together to relieve the financial burden. If MRG ultimately shows the financial solution to be unfeasible, the covenant would terminate. There was a discussion of various specifics within the document. If we exceed the $1.5 million in fundraising goals, the additional funds will be set aside for maintenance by PTV; we could then access the funds through another grant request. PTV has an issue with subsequent funding through a bank that might be necessary if we do not raise sufficient funds. The various banks have agreed to subordinate to PTV for the critical elements and the corridor it occupies. The banks are just concerned that the single be maintained and operational for income purposes.


Campaign Memorandum of Understanding (MOU) with the Preservation Trust of Vermont – sets fourth the details of how MRG and PTV will work together and the process of raising the necessary funds, the decision making process and the legal status of MRG and its bylaws. The MOU also set the process whereby the Stark Mountain Foundation (SMF) can participate in the fund raising process in partnership with MRG and PTV. It restricts MRG from making changes to bylaw, Article XIV, or from distributing earning; these restrictions were questioned as being a change to the existing bylaws. MRG has proposed that specific wording be added to exclude the patronage rebates and PTV is agreeable to this change. Jamey will discuss the bylaw wording restriction with Steve Cantor, MRG legal council.


Grant Agreement – The agreement to raise $1.481 million is the total project goal with the minimum campaign goal set at $309,000, which enables MRG and PTV to go forward with the covenant. PVT will take $59,000 off of the top for administrative costs – $25,000 for internal administrative costs and $34,000 for a stewardship endowment fund to keep track of the agreement ongoing. The grant agreement outlines the payments to be made and PTV’s obligation to MRG. This is the contractual agreement, which relates to the fundraising. The board discussed the origin of the $309,000 minimum and the relatively high administrative and endowment costs. It was noted that if we were able to raise funds significantly exceeding this number it would not be an issue. The force majeure portion of the agreement provides that MRG will not be held responsible for any acts of God or other events beyond our control that prohibit MRG from achieving the deadline of December 2007.


Jamey Wimble reported that the PTV met with their board July 14th, they endorsed all documents, and are still discussing the subordination clause.


Shareholder Comments – Penny Parson, Chair of the SMF, stated that the SMF board met to discuss the covenants, MOU and Grant Agreement. The board of the SMF has endorsed the approval of the documents.


Upon motion duly made by Bill Reynolds and seconded by Jed Kalkstein it was unanimously

VOTED: To authorize Jamey Wimble to sign the covenant, MOU, and grant agreements subject to final editing and resolution of the bylaws amendment issue in the MOU.


Recognition of Volunteers and Staff – Jay will ask Geordie to compile a list of all individuals for future recognition.


The Board went into executive session for approximately 10 minutes.
The executive session was informational in nature and no action was taken.


There being no further business to come before the board, the meeting adjourned at 10:51 am.

Respectfully submitted, Deb Steines
A true record.
William B. Reynolds, Secretary
a. Management Report

Management Report
Mad River Glen
July 15, 2006

A wet early summer has made it tough to do mountain work. The outside guys have been working on lifts the past couple of weeks and were working on a capital project prior to that.
We have signed the contract with Doppelmayr/CTEC for the Single project. We are a GO for 2007.

We settled a liability case from February 2003 in arbitration in June. Skier was trying to claim negligence on part of a ski instructor. We settled for $7,500. They were asking for $150,000. We had a rock solid case that we would have won in court and their attorney could see this so, they settled for some go away money.

Roland Palmedo (Founder of Mad River Glen) will be inducted into the Vermont Ski Museum hall of fame in October.


Starks Nest upgrades are complete. A new roof and deck were replaced in June. The project was funded by a grant from the Stark Mountain Foundation.
Electric upgrades in the base area will start in mid August and will be complete by Green Gold. This will be a phase of the Single project as well as great base area improvement.


Share Sales:
1 share was sold for the month of June against a budget of 1. 40 shares have been sold against a budget of 37 YTD. 17 shares are on the list to be tendered October 1.


June is $24,000 over budget. This is due to a timing payment on the facilities end (Still well under budget YTD) and a cumulative wage adjustment for 05-06.

Our estimated year end is looking more like a $250,000 loss. We are holding some payments due to limited cash flow at this time and is making it a little trickier to determine year end. Our insurance audits are coming in shorter than they originally projected for us too. Our General Liability insurance premium and workers comp premium are calculated from revenue and payroll. So, we get a refund on bad years. But they are coming in lower then originally projected.

Our current cash position is $137,000. This is a total number of all cash resources. We should still be fine to make preseason without drawing on our line of credit at the bank. $100,000 has been paid to Doppelmayr/CTEC for the Single.