ASC changes bonus policy
December 15, 2006
Steamboat Springs — A bonus program for American Skiing Company executives has been amended so that it only comes into play if $300 million in assets are sold, according to a company filing with the Securities and Exchange Commission.
The change in the company’s Phantom Equity Plan has nothing to do with a potential sale of the Steamboat Ski Area, said company spokesman David Hirasawa. “You’re going to have to take this at face value,” he said. “There is no connection to Steamboat.
ASC owns Steamboat and listed it for sale last summer. No deal has been announced but projections indicate that the ski area would sell for less than $300 million. The bonus program would kick in if ASC sold Steamboat and another asset within 30 days and the total value of the two was for more than $300 million.
ASC’s board of directors compensation committee chose to amend the Phantom Equity Plan to reclassify the plan for tax reasons. Those who are in the plan will save 20 percent in taxes should they receive a payout, Hirasawa said.
ASC announced the changes Thursday in an SEC filing.
The Phantom Equity Plan benefits certain company officers, including ASC CEO B.J. Fair.
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The program does not benefit Steamboat Ski and Resort Corp. President Chris Diamond. He opted out of the incentive program as part of his Nov. 7 employment contract. Instead, Diamond was promised a bonus of between $400,000 and $725,000 should the ski area sell.
Before the Phantom Equity Plan was amended, payments would have been made to participating ASC executives if one of several things happened. One of those things included the “sale or disposition of a significant company operation or property as determined by the board.” Hirasawa said the compensation committee felt that language was vague.
If payouts were triggered, participants in the incentive plan would split a pool of money. The minimum amount in the pool is $2 million, but as much as $32 million could be split depending on the plan’s equity value.
Also at its Dec. 7 meeting, ASC’s board of directors compensation committee decided incentive bonuses for the company’s executive officers.
Fair received a bonus of $120,000 and Diamond was given $56,000. Other bonus recipients were Helen E. Wallace, senior vice president and chief financial officer, $75,195.84; Stan Hansen, senior vice president-real estate, $39,630.15; and Foster Stewart, senior vice president and general counsel, $63,256.17.