Tag Archives: travel

casino.del.sol

Casino Del Sol Resort Achieves 4-Star Rating

Casino Del Sol Resort, an enterprise of the Pascua Yaqui Tribe, was recently named to the prestigious Forbes Travel Guide Star Rating List. Recognized for exceptional service and amenities, it is the only casino resort in the state of Arizona to receive the coveted four-star rating.

The overall property was awarded, as well as Hiapsi, the luxurious spa retreat offering treatments inspired by Native American healing rituals, and PY Steakhouse, Casino Del Sol Resort’s contemporary, fine-dining restaurant. The 2014 Forbes four-star rating is the latest addition to the property’s list of accolades. Garnering numerous national and local recognitions, Casino Del Sol Resort is also a AAA Four Diamond recipient, and 2012 and 2013 Wine Spectator Award of Excellence winner for PY Steakhouse.

“Achieving this honor is a remarkable accomplishment for Casino Del Sol Resort. It is a testament to the countless contributions of our dedicated and passionate team members, and would not be possible without them, the Pascua Yaqui Tribe and the guests of our award-winning casino resort,” said Jim Burns, CEO of Casino Del Sol Resort.

Since 1958, Forbes Travel Guide ratings have been the gold standard of luxury travel. The requirements are the most stringent in the industry with more than 500 criteria evaluated to determine a star rating.

“Our Star Ratings recognize the finest hotels, restaurants and spas in the world. These ratings serve as guideposts for consumers seeking exceptional travel experiences, and our primary mission is to serve the consumer,” said Michael Cascone, President of Forbes Travel Guide. “We’re proud to be associated with the new additions to our global list.”

For a detailed explanation of how Forbes Travel Guide compiles its star ratings and to view the complete list of 2014 winners, visit www.forbestravelguide.com.

For more information about Casino Del Sol Resort or to book a reservation, visit www.CasinoDelSolResort.com.

ipo

Advantages and disadvantages of an IPO

The closing concludes and a company suddenly has $50 million cash in its bank account from the sale of its stock.  Champagne corks are popped and celebration ensues―for a brief period.  “Going public” is an exciting event for all involved and may provide many advantages to the company’s operations.  However, being a public company has certain disadvantages that should also be considered.

“Going public” refers to a sale of stock or debt in an initial public offering or IPO registered with the Securities and Exchange Commission (SEC).  A “public company” refers to a company that has undertaken an IPO or is otherwise required to be a reporting company under the Securities and Exchange Act.  A “private company” typically has a limited number of owners or investors and is not required to file reports with the SEC.  This article discusses some of the advantages and disadvantages of “going public.”

Advantages of an IPO

An IPO and the result of being a public company may provide significant advantages to the company and its stockholders.  These include cash infusion, ability to “mint coin,” easier future access to equity and debt markets, liquidity for pre-IPO stockholders and institutionalization of the company.  The common theme of these advantages is that a liquid market for its stock “unlocks” value that the company could not otherwise access.  By having publicly traded stock, the discount that is attached to stock of private companies no longer applies.

Cash Infusion The result of an IPO is a significant and immediate infusion of cash into the company.  This cash is typically “earmarked” for specific items described in the IPO disclosure documents, which can be for a variety of purposes.  For example, the company may use the proceeds of the IPO to expand its inventory, property and equipment base, reduce debt, further research and development or expand its services.

Minting of Coin. Having an established value and liquid market for its stock creates additional “coin” for the company through issuance of additional stock.  This “coin” may be used as consideration to acquire other business and to compensate both current and future employees.

The ability to utilize the company’s stock for an acquisition significantly decreases its cash needs and allows it to engage in transactions without tapping into its “war chest” of IPO proceeds, which can be put to use to fund future growth.  In addition, acquisitions using the company’s stock as consideration may be structured as a “tax-free” reorganization, which can allow the sellers to defer taxes on gains associated with the sale of their business.  Using stock as consideration for acquisitions also provides sellers an opportunity to participate in the future growth of the combined organization.

Another benefit of a liquid market for a public company’s shares is that its stock may be used to compensate both its existing and future employees through the grant of options or direct issuance of shares.  Grants of options or stock provide a means to share the company’s success and are a great tool for attracting talented management and employees.

Access to Capital Markets.  Being a public company enhances access to both equity and debt markets.  After the company has been a reporting company for 12 months, it may engage in follow-on offerings using a “short form” registration process.  The ability to use this process reduces both the time and expense of future equity financings.

As a reporting company, the transparency of its financial position and operations makes it better suited to obtain debt financings.  The infusion of cash from an IPO also enhances the balance sheet and makes the company a much stronger candidate for debt financings.

Liquidity An IPO provides liquidity to the company’s founders, employees and pre-IPO investors holding the company’s stock.  While the liquidity may not be immediately realized due to “lockup” requirements imposed by underwriters and other SEC rules, being a public company provides a means for the pre-IPO stockholders to monetize the value of their stock at some point in the future.

Institutionalization.  Being  publicly traded  adds to a company’s stature as an institution, which can enhance its competitive position.  The IPO process itself generates publicity that may enhance the company’s recognition in the marketplace.  As a result, suppliers, vendors and lenders often perceive the company as a better credit risk and customers may perceive it as a better source of products or services.  The stature of a public company can also enhance its ability to attract top level executives and employees.

Disadvantages of an IPO

While going public provides significant advantages to a company and its stockholders, the requirements imposed by securities laws produce disadvantages to the company and its operations.  These include increased costs, securities law compliance, changes in corporate governance structure and becoming a “slave to the stock price.”

Costs.  The costs of an IPO include both the costs of engaging in the offering process and the future costs of being a reporting company.  Typical costs of raising $50 million through the IPO process can range from $3.5 million to $5 million.  Raising less money can increase the percentage of offering costs significantly.  These costs include underwriting commissions, legal and accounting fees, SEC and National Association of Securities Dealers (NASD) filing fees, exchange fees, financial printing, travel and other miscellaneous costs related to the offering.  In addition to these initial costs, as a reporting company subject to securities laws, including Sarbanes-Oxley, and exchange listing requirements, the company will have significant ongoing costs associated with its operations.  These costs include outside directors’ fees and expenses, directors’ and officers’ liability insurance, accounting and legal costs, internal control costs, printing costs for stockholder reports and proxies and costs of investor relations.  According to a survey published by Foley & Lardner LLP, these costs average approximately $2.37 million per year, not including lost productivity costs, for public companies with revenue under $1 billion.

The costs are not just monetary.  The IPO process can take up to six months or longer.  During this period the company’s executive management team must devote substantial time and energy to the IPO.  This takes away from management’s time and ability to run the company’s business, and operations may suffer during the IPO process.

Securities Law Compliance A myriad of compliance issues results from an IPO.  The IPO process imposes severe restrictions on the company’s marketing and publicity activities during the “quiet period” preceding the filing of a registration statement.  The registration and reporting process involves the disclosure of significant information about the company that is readily available to the company’s competitors.  Following completion of the IPO, the company will be required to file quarterly, annual and current reports detailing its operations and announcing major events.  This disclosure includes detailed information about operations, executive compensation, financial results and significant customers and vendors.  Proxy statements must be filed with the SEC before a stockholders meeting can be called.  The company cannot release information on a selective basis and must be careful to assure that the information it releases is accurate and complete.  Company insiders and major stockholders also must comply with the Exchange Act requirements for reporting their stock ownership and prohibitions on short swing trading.  Finally, the exchanges where the company’s stock is traded have various listing standards that impose additional governance and disclosure requirements.

The changes to the securities laws resulting from the Sarbanes-Oxley Act have greatly increased the compliance issues that a public company must meet (with corresponding cost increases).  These include enhanced auditing and governance standards, additional responsibilities for the company’s independent directors, development and documentation of control procedures and certifications by the CEO and CFO.  The certification requirements are backed up by possible criminal sanctions for violations.

Change in Corporate Governance Structure A listing requirement of the major stock exchanges is that the company’s board be comprised of a majority of independent directors.  Independent directors cannot be officers, employees, major stockholders or outside service providers.  Independent directors must comprise the audit, compensation and corporate governance committees.  This means that the duties of selection and oversight of auditors, setting executive compensation and determining board candidates and litigation issues are taken away from management and given to “strangers” that may have little past experience with the company’s operations.  Another listing requirement is holding annual stockholder meetings.  Matters such as calling meetings and presenting proposals to stockholders must now be accomplished in compliance with SEC rules.

A major change brought about by Sarbanes-Oxley was empowerment of the independent directors.  Previous “best practices” of having a majority of independent directors are now mandated by exchange listing requirements.  The independent directors are charged with oversight of the company’s management and auditors.  For most companies, particularly where the founders are executive management, the change in corporate governance structure resulting from being a public company may take some adjustment.

Becoming a Slave to the Stock Price It is often said that a professional baseball pitcher is only as good as his last outing and that a CEO of a public company is only as good as her company’s last quarter.  While a fluid and liquid market in a company’s stock unlocks value, a public company’s stock price is frequently subject to rapid fluctuation.  The stock price can be affected by a variety of factors, over which management may have little or no control.  Reporting of quarterly earnings can lead to decision making based on the short term result when a longer term perspective would be better for the company.  The close ties between executive compensation and their personal net worth to operating results enhances the dilemma of seeking short-term results at the sacrifice of long-term perspective.  Wall Street can be impatient and, as with baseball pitchers, may have a tendency to look only to immediate past results rather than the big picture.

A loss of stock value can lead to dire consequences, such as stockholder lawsuits, loss of confidence in management and possible hostile takeovers.  Lawsuits can stem from a sudden decline in stock price.  A stockholder lawsuit can be very costly and distract management from running the business.    Recently stockholder activism has been on the rise and dissatisfaction with directors (including executive management on the board) has been evidenced by stockholders withholding approval of directors.  Various proposals, such as mandatory removal of directors that do not win a majority of stockholder approval in elections, are increasing the pressures on management to perform on a quarterly basis.  If a company loses favor with analysts and stockholders, its stock may suffer additional devaluation, which could lead to it becoming attractive to a hostile takeover bid.  A successful takeover, particularly a hostile takeover, could result in the company’s founders being removed from management positions.

Conclusion

While going public can have many positive effects on a company and its operations, these positive effects must be balanced against the disadvantages.   Going public drastically changes a company’s culture and has an ongoing impact on business operations.  Determining if going public is the right course for a company to pursue is a major decision and must be carefully considered by management before this course is taken.

 

Thomas Morgan is a partner in Lewis and Roca’s (www.lrlaw.com) Phoenix office in Phoenix, Arizona. He practices securities, corporate and tax law with an emphasis in public and private securities offerings, private equity fundings, mergers and acquisitions, regulatory compliance, and general tax planning. He can be reached at 602.262.5712  or TMorgan@LRLaw.com

AMR-US Airways

What an American-US Airways merger means to you

While American Airlines and US Airways have started merger discussions, it would be several months — if not years — before passengers see any real impact.

Passengers with existing tickets on American or US Airways — and members of both frequent flier programs — shouldn’t fret. No changes will come anytime soon.

Assuming quick merger negotiations, American’s parent company, AMR Corp., would still have to work its way through the bankruptcy process. Then the Department of Transportation and the Justice Department would have to sign off on it. Finally, once a deal closes, the new company could operate two separate airlines for a number of years.

If the airlines finally merge, here’s what passengers can expect:

AIRFARE

In the past decade, the airline industry has seen the combinations of Delta with Northwest, United with Continental and Southwest Airlines Co. with AirTran. Further consolidation is likely to raise airfares. The price of a domestic round-trip flight has climbed nearly 20 percent, when adjusted for inflation, over the last 10 years, according to the Bureau of Transportation Statistics.

The merger would give a combined American and US Airways Group Inc. the ability to increase fares. United, Delta and Southwest would be likely to follow.

FREQUENT FLIER MILES

Your miles would be safe. Eventually, the two airlines would merge the miles into one program. Before then, elite status from one airline would likely be honored on the other and passengers would be able to transfer miles from one program to another. That puts the occasional traveler closer to rewards.

The merged carrier would continue American’s participation in the OneWorld alliance, which was founded by American, British Airways, Cathay Pacific and Qantas. Today, it has 12 airlines including Finnair, Mexicana and Japan Airlines. US Airways would leave the Star Alliance, which includes rival United Airlines, Lufthansa, Air Canada and 24 other airlines. Alliances allow passengers to earn and redeem miles on partner airlines.

DESTINATIONS

A key reason for merging is to link both airlines’ networks, creating a system on par with Delta Air Lines and United Airlines, part of United Continental Holdings Inc. American currently serves about 250 cities in more than 40 countries with 3,400 daily flights. US Airways has 200 destinations in 28 countries with 3,200 daily flights. There is some overlap. But by joining forces the combined airline would become more attractive to companies seeking to fly employees around the globe with few connections.

US Airways passengers would gain access to American’s international destinations, particularly London and Latin America. American’s passengers would be able to better connect to smaller U.S. cities that US Airways serves.

The combined carrier would have considerable presence in New York, Philadelphia, Washington, Charlotte, N.C., Miami, Chicago, Dallas, Phoenix and Los Angeles. It is unclear how many of those cities would survive the merger. In past mergers, airlines have promised not to close any hubs but have gone ahead and dramatically reduced service in once-key cities.

PASSENGER CONFUSION

The merger of two airlines often means confusion and hassle for customers. Which terminal or ticket counter do they go to for check in? If there is a problem with a ticket, which company should they call? For a while, United and Continental were issuing two confirmation numbers for each ticket so either airline’s staff could make changes. Problems with the integration of their frequent flier programs angered many loyal road warriors. It could be months, if not years, until all American and US Airways planes get a uniform paint job.

“These things are never as seamless as they seem,” said Thomas Lawton, a professor of business administration at Dartmouth College’s Tuck School of business. “There will probably be some initial teething problems.”

Heard Museum

Things To Do In Arizona: The Heard Museum

When you grow up in Arizona, sometimes the coolest things are in your own backyard and you don’t even realize it. Recently I spent an afternoon at the Heard Museum in Central Phoenix and thought to myself, “Why haven’t I been here before?”

Entering the grounds, it’s not hard to be in awe of the buildings marvelous architecture and how they complement one another. Even more breathtaking is how nature is incorporated throughout the grounds, including the various gardens that are part of the exhibits. The Heard Museum is a perfect example of combining the use of art, nature, and the charms of Arizona to create something new and exciting for visitors to see.

Upon entering, I was warmly greeted by two gentlemen who told me about the various tours available and offered to answer any questions. Feeling adventurous, I decided to strike out on my own; hoping to create my own adventure on the museum’s vast grounds. This allowed me to pace myself and explore in more detail what interested me.

My first stop was the “Home: Native People In The Southwest” gallery. I was dazzled by the numerous collections of jewelry, instruments, and clothes. What became one of the most vivid encounters of my experience was a wooden fortress. The moment you set foot inside you could smell the freshly cut trees and take in how this structure was built.

The various patterns of how the logs were intertwined to make the structure stable were beautiful. The pattern left a circular hole in the center of the roof and a wooden bench lined the circular hut.

As I proceeded through the Heard Museum I examined more and more artifacts that I wasn’t certain could be topped. The surprises that awaited me throughout my journey were just as informative as they were beautiful.

What I was most impressed with was how interactive and hands-on the experience can be. There were multiple areas such as the Ullman Learning Center and Freeman Gallery that featured kid-friendly activities. Many of the exhibits had video stops or buttons to push that allowed the visitor to listen to personal stories relevant to the exhibit.

An amazing amenity the museum offers are outside benches that allow you take a break from learning and enjoy nature and architecture as water features run near by.

Of course, you can also take a break by visiting the Coffee Cantina or the Courtyard Café, which serves lunch and desserts that include a unique experience of local and indigenous ingredients in the culinary creations. If your stomach is full but your appetite for knowledge is still not satiated, be sure to check out the Books and More shop.

As I left the Heard Museum and weaved through the pillars making my way gradually to the parking lot, the sculptures became more apparent and I discovered some that I had not previously noticed.

The Heard Museum allows visitors to be just as aware of its exterior, not giving up any secrets as to the memorable experience inside.

Memorable. That’s a word I would use to describe my experience. My only regret is that I didn’t come here sooner.

This was a wonderful experience. Next time I hope to find another adventure awaiting.

For more information on the Heard Museum, visit their website at www.heard.org.

Photo: runnr_az, flickr

Skydiving Arizona

Near the end of my first year at Arizona State University, myself and two other friends decided to take a leap into something we’ve never done before.

The chance to jump out of an airplane from 13,000 feet in the airPhoto: Ryan Harvey, Flickr was presented to us, and we weren’t going to turn it down. Getting the three of us on board with the plan was an easy task; we had all been craving a new thrill, and skydiving was high on our list.

In the early morning we gathered together into one car and made our way to Eloy for a visit to Skydive Arizona, a company that provided everything we would need to complete our skydiving adventure.

After about an hour-long drive from Tempe, we arrived at our destination where we wandered the site a bit and watched other skydivers coming in for their landing. Soon we learned the basics of skydiving safety and how our jump would work. Next we put on our harnesses and headed to the plane that would take us up into the sky.

A little car that looked like an elongated golf cart with no roof took us to the plane just as our nerves came into full swing. We hopped off the cart and climbed into the plane that had benches lining the Skydiving, Eloy, Photo: Ryan Harvey, Flickrwalls instead of the rowed commercial airline seating that I was used to. This was definitely the smallest plane I had ever been on.

After a fairly quick take off, we were headed up to our destination of 13,000 feet. Hip hop music played over the speakers as we nervously joked around and took pictures with each other.

Soon it was time to jump out of this plane that I had just started to get used to. I watched the first two people, who were experienced jumpers, flip out of the plane and quickly fall away into the sky. As I inched forward and approached the door, I got my first real glimpse of the wide open sky and a small world down below. In one swift motion the entire world was flipping above and below me, like nothing I had ever experienced before. It was amazing to see and feel such a huge mass of land being thrown around me like it was nothing.Skydivers, Eloy, Arizona, Photo: runnr_az, flickr

After free falling for a short time, I pulled the cord that released the parachute, and while pulling on the handles to steer the parachute into some drastic and very amusing turns, I gently floated back to ground level. I landed smoothly into the grass, quickly followed by my other two friends.

The rest of our day and night was spent in a euphoric state, reveling in what we had just experienced, and eager to do it again.

Route 66 information

Historic Route 66

First established in 1926, Route 66 is an American legend. Though it was, for all intents and purposes, “decommissioned” in 1985, the road still lives on in the various states it passed through. In Arizona it exists today as State Route 66. Take a look at the infographic below for more information about the historic road.

Route 66 information