It's been a tumultuous six months internally for the folks at Cascade Designs (CDI), largely a result of a revision of the CDI Employee Stock Bonus Plan (ESBP) which left company founder John Burroughs holding approximately 96 percent of the company shares. As a result, several key veteran members of the CDI management team decided it was a good time to move on, including, most recently, Lee Fromson, who will step down as company president on Feb. 28 -- two years earlier than announced in an internal memo leaked to SNEWSÂ® in mid-2005.
For a variety of reasons, too complicated and time-consuming to go into within the confines of this article, and despite what many veteran CDI employees have told us was an understood promise to allow the employees to assume ownership of Cascade, a committee of majority shareholders voted in August 2005 to modify the ESBP when it became clear Burroughs was no longer interested in relinquishing his shares or control.
"After John Burroughs' intention not to sell his stake in the company and instead to keep it in his family became obvious, I had to first get over my disappointment at this philosophical change," Fromson wrote in an internal CDI document, published in June 2005 and leaked to SNEWSÂ®. "The promise contained in the ESBP for the past fifteen years was that the employees would own Cascade Designs. This now would not be fulfilled because the majority shareholder had other plans. Once I accepted this new reality, I must agree that the proposed plan represents an acceptable compromise for the company, John Burroughs, and the employees. Although this is not the most optimal deal for all the parties involved, it still is a fair agreement."
As a result of the modified ESBP, most shareholders had a choice to sell their stock back to CDI and Burroughs, or hang onto shares but pay an IRS tax since shares were now officially classified as assets. Most employees, we were told, now knowing company ownership was no longer a possibility, opted to sell their shares back to Burroughs.
By mid-December, Pete Frickland decided it was time for him to leave (read our Dec. 16, 2005 story, "Pete Frickland steps away from Cascade Designs after two decades" by clicking here.)Â
Shortly after that, Jerry Lloyd decided it was also time to move on, and he accepted early retirement. Lloyd was the first non-founding employee of Cascade Designs, joining the company in 1979. Â
In early January, it became clear to both Fromson, as well as to Burroughs, that Fromson was at a time in his life and career that he should move on to new challenges.Â Fromson told SNEWSÂ®, in a phone conversation shortly after his resignation was announced to the company on Feb. 9, that he will remain on the board of Cascade Designs for the time being. Â
Burroughs, founder, past president and current chairman of the board, will resume the role of interim president. Burroughs' son, David, will be working for CDI as "assistant to the president," Burroughs told us.
On the morning of Feb. 10, Jeff Bowman, who was hired by Fromson three and a half years ago, shortly after Fromson became president of CDI, was asked to leave. Bowman had been at the helm of CDI's outdoor business as vice president of outdoors and strategic planning. The company's official position is that Bowman resigned, but insiders tell us he had to clear out of his office by the end of the day and that his departure was a forced resignation, not a voluntary one.
"Despite a great deal of mutual respect for one another, Jeff and I have had opposing views on the bigger vision of the company moving forward," said Burroughs.Â "He's leaving an extremely strong team that's successful in no small part to his leadership, which I really appreciate."
SNEWSÂ® contacted Bowman at home on Feb. 13 and he confirmed he was no longer employed by Cascade. He also told us that, "Cascade Designs is a wonderful company staffed by great people. I'm confident that they will continue to lead with innovative new products, tremendous customer service and great brand marketing.Â I wish John and the folks there only the best."
Burroughs has made it very clear to us that he is interested only in an interim run as president. "We are considering several very qualified internal candidates, and I will serve as interim president only as long as it takes to get the appropriate person into place."
To answer questions that have already arisen regarding the impact to the company from the loss of Fromson, Lloyd, Frickland and now Bowman, Burroughs pointed to the fact that he has a very strong and veteran team of executives that will be reporting directly to him, including: Schuyler Horton, vice president of sales; Ann Dimond, CFO; Ken Meidell, CIO; Nancy Dienes, vice president of operations; Joe McSwiney, vice president of European operations and manufacturing; Pete Haggerty, vice president of government and legal affairs; and Randy Willett, vice president of medical sales.
"CDI will continue to deliver a unique combination of product innovation, brand support and service to our dealers and their customers," Burroughs said. "With this focus, we've been able to build great brands by bringing premium products, developed by in-house invention and through acquisition -- and we will continue to use this approach to grow our outdoor business in the future.
"I love the business and products and all the people involved and we will make sure that our reputation of product innovation, brand support and great customer service continues to be the way we are remembered," Burroughs told SNEWSÂ®. "We had the SNEWSÂ® 'Best Company to Do Business With' recognition in your survey 16 years in a row and were very upset when we lost it. We came close this year, and vow to be back on top."
SNEWSÂ® View: There are certainly a number of ways to look at this, depending upon your perspective. We prefer to take Lloyd's approach, who told us he had an epiphany while in a friend's barn one day and saw the sign, "My barn, my rules." Cascade is Burroughs' $85 million barn. Plain and simple. Will things be different without Bowman, Frickland, Fromson and Lloyd? Most certainly, and perhaps that is the point. Notice we said simply different -- neither bad nor good. That legacy remains to be determined. We suspect that with the current cast of characters still at Cascade, it will be mostly good. We also suspect that Fromson will surface somewhere very quickly in the outdoor industry, at a place of his choosing, and in a time of his choosing.
Still, we would be remiss if we did not give Lloyd and Fromson their due. No matter how Cascade or anyone tries to spin it, the loss of that brain trust and industry experience is a huge loss indeed.
Before Lloyd joined Cascade, he worked for Black Manufacturing and MSR when Larry Penberthy owned the company. Lloyd was the first president of TASK (Trade Association of Sea Kayaking). While at Cascade, Lloyd came up with the idea for an Ultralite Therm-a-rest as well as the Camp Rest. Almost every sales rep for Cascade Designs (many of them industry icons themselves) were hired by Lloyd: Mike Sullivan, Mike Miller, Walt Meyer, Scott Andrews, Eric Cleaveland, Rick Stoner and Richard Stone. Lloyd is now retired on Whidbey Island with his wife Connie and by his own admission, is busier than ever creating a farm. In their spare time, Lloyd and his wife have raised champion Portuguese Waterdogs, and an offspring of theirs has won Westminster a couple of times. Â
During a tenure which began in 1982, Fromson worked as the company COO, CFO, company vice president and finally president and during that time oversaw the acquisitions of MSR, Sweetwater, Smart Track rudder systems, Tracks, Packtowl, Platypus and Seal Line. He is a member of the OIA board and served as chairman of the board for two years. While there is lots of meat in his curriculum vitae, the devil is in the little known personal details, and to know Fromson, you have to look beneath the titles and leadership mantle. True, he is married to a wonderful woman, Twala Coggins, but it is worth noting that it was a giant Elvis who did the deed -- seriously. His daughter Casey just graduated from UW with a degree in international environmental studies, and Fromson promised her a trip anywhere in the world. So, with his newly acquired time off, he's off to Bhutan with her for a month later this year. He helped to put together the Outdoor Industry Executive endorsement of the Kerry Edwards run for the presidency in 2004 (we're still not sure if that is that something to be proud of or embarrassed by). He has raised two champion English Bulldogs which basically says he's good at training animals to be fat, dumb and lazy. But most notably, he was an integral part of perhaps the most infamous and phantasmagoric industry food fight of all time at Mikado in Salt Lake City with Sally McCoy, Frank Hugelmeyer, George Grabner and others who will remain nameless only because they each paid us huge sums to keep their names out of print. Yes, all are still welcome back to Mikado -- perhaps because the tip was so stupendous.