Why We Need an Independent BOD

 Some myths Wynham would like for you to believe.

 

1. MYTH: Only experts in the timeshare industry (such as Wyndham executives) can effectively manage acompany such as WorldMark.

FACT: WorldMark is effectively a homeowner’s association(HOA), and the board is supposed to provide oversight to the management company for the HOA.  It is not necessary to be in the industry in order to provide this oversight.  A representative of Wyndham (the management company) is present at all board meetings to confer on technical issues.  The current board rubber-stamps all Wyndham decisions; no expertise involved there.  Of the 230,000 current WorldMark owners, 5 can be found with the necessary skills to oversee the management company.  Our membership contains leaders in government and private sector firms across the nation.  We don’t need Wyndham providing oversight of Wyndham.

 

2. MYTH: The WorldMark Board of Directors can recommend, but has no authority to reject properties that Wyndham, the developer wants to annex to the club.  The board also has no authority to negotiate credit assignments or seasonal calendars.

The board has stated this in person at the annual owners meetings, and has also posted it on the WorldMark forum.  As proof, they’ve cited the Declaration of Vacation Owner Program.

FACT: The Declaration of Vacation Owner Program is specific to individual properties.  One is signed by both Wyndham and the WorldMark Board of Directors for each property added to the club.  It is only effective AFTER it is signed by the WorldMark Board of Directors.  If they don’t sign it, Wyndham will not annex it to the club.  So the Board of Directors wields the final authority over whether to add a property to the club.  If they don’t want it, due to poor location, poor quality, credit assignments too high, or seasonal calendars that include too many red weeks, it won’t be added.  Truth is the board has abdicated their responsibility to the club to protect us from these poor decisions.

 

3- MYTH:  Wyndham has to charge more credits to stay in the new resorts, in Las Vegas, Orlando, San Diego and elsewhere, because costs are higher to build there.  Timeshare regulatory agencies have permitted higher credit values based on cost.

FACT: Of course it costs more to build now than it did previously.  However, the Declaration of Vacation Owner Program stipulates that credit assignments are to be based on relative use-value, not costs.  As an example, the Camlin, San Francisco, and San Diego are all urban hotel conversions, and should be valued the same.  However, San Diego comes in at 25% higher credit value than these other resorts.  This is directly contrary to the governing documents (section 3.4(a) of the Declaration of Vacation Owner Program).  If a property costs more, the credit price should go up, not the credit values.  This would protect your investment, rather than dilute it.  While our existing properties have risen in value between 100 – 500 percent over the last 10 years, the price of credits has risen around 25%.  So your interest in the existing properties is being diluted by all these relatively cheap credits Wyndham is selling to new owners.

4 - MYTH:  Cheaper resorts, such as Oklahoma, need to cost 10,000 credits for a 2-bedroom duringred season, in order to off-set the higher cost of other resorts.

FACT:  If higher cost resorts charge more than 10,000 credits for a 2-bedroom during redseason, then lower cost resorts (such as Grand Lake, Galena, and others) should cost less than 10,000 credits for a 2-bedroom during red season. Wyndham cannot have it both ways.

5 - MYTH:  The WorldMark Board and Wyndham adamantly oppose TOT (Transient Occupancy Tax) at the resorts.

FACT:  Trendwest proposed the imposition of the TOT at Indio even though the city leaders acknowledged that they could not charge it if Trendwest hadn’t proposed it.  Now Wyndham gets a kickback of 45% of the TOT for the first 10 years, resulting in approximately $7.5 million directly in their pockets, out of your pockets.  When asked about this at the 2005 Owners Meeting, the WorldMark Board denied knowing about it, even though it was public information at that time.

 

6 -MYTH: There is no conflict of interest in having Wyndham employees serve on the WorldMark Board of Directors.

As proof, they say that only they can best protect WorldMark, since they best know their way in and out of the Wyndham hierarchy.  Also, it has been said that they understand how to “switch hats” between Wyndham and WorldMark.  They say that since they have never acted on this inherent conflict of interest, it doesn’t really exist.
 

FACT:  The existence of a conflict of interest is NOT dependent on the person in conflict actually taking advantage of this conflict. The conflict exists or it doesn’t; the person’s actions don’t affect the existence of that conflict of interest.  The Wyndham executives on our board are bound by law to protect the interests of Wyndham shareholders, even if doing so conflicts with WorldMark’s interests.  That’s called a conflict of interest.  The interests of Wyndham and WorldMark are congruous in many cases; but not all.


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