Opinion ID: 4211955
Heading Depth: 3
Heading Rank: 1

Heading: Cherrett’s Employment with Aspen

Text: Paul Cherrett (Cherrett) began working in the hospitality industry in 1979. He spent approximately twenty-five years with the Four Seasons hotel chain, including five years at the Four Seasons in Jackson Hole, Wyoming. In December 2006, while Cherrett lived and worked in Jackson Hole, he heard about an open managerial position at Aspen Skiing Company (Aspen) in Colorado. He did not apply for the position because it did not offer any new responsibilities compared to his job at the Four Seasons. Months later, in 2007, Cherrett learned that Aspen had created a new uppermanagement position with expanded responsibilities. He expressed interest to an executive search firm and interviewed for the job. Aspen offered Cherrett a position leading its hospitality division as a senior vice president heading up the expansion of Aspen’s “Little Nell Hotel” brand, Aspen’s prestigious “flagship property.” Cherrett understood that if the Little Nell Hotel expansion continued, he might have the opportunity to oversee brand development in Jackson Hole and move back to his home there. Cherrett also understood that if he accepted the position with Aspen, he would need to live near Aspen’s office in Colorado, at least initially. This represented a challenge because his daughter had two years of high school left, Cherrett and his wife did not want to relocate her to a new school, and in Cherrett’s view, the salary proposed by Aspen did not cover the high cost of IN RE CHERRETT 5 living in the Aspen area nor offer sufficient incentive to disrupt his family’s life in Wyoming. The salary was not enough for him to afford to buy a home in Aspen, and rentals there were “few and far between” and also very expensive. In negotiations regarding compensation, Aspen eventually offered a $500,000 housing loan (Housing Loan) in addition to an annual salary of $300,000. The Housing Loan was interest-only for the first ten years and it was coupled with a bonus plan providing Cherrett a guaranteed annual bonus of up to $33,750 to cover the interest payments on the loan. The annual bonuses were timed to coincide with the date the annual interest payments were due, ensuring that, for the first ten years, Cherrett would have no out-of-pocket expenses related to the loan. If Cherrett left his position for any reason other than death or disability within two years, he would have to repay the loan and pay Aspen an additional $140,000. He would have to pay $120,000 for leaving within three to four years; $100,000 for leaving within five to six years; and $80,000 for leaving within seven to eight years. Cherrett would not have to repay any additional interest on the loan if he continued to work for Aspen through 2015. Aspen estimated the value of the plan at $330,750 over a period of ten years. Only with the Housing Loan did Cherrett find Aspen’s offer attractive enough to accept. He left his job and family in Jackson Hole, and purchased a condominium near Aspen for $995,000. The Housing Loan covered $500,000 of the purchase price, and Cherrett financed $417,000 with a loan from a market-rate lender. Cherrett’s wife and daughter remained at the family home in Jackson Hole so that his daughter could finish high school 6 IN RE CHERRETT there. The condominium in Colorado was smaller than the family home in Jackson Hole and did not have enough space to accommodate Cherrett’s wife and two children. With hopes of relocating back to Jackson Hole to develop the Little Nell Hotel brand, Cherrett considered the Colorado condominium a “place holder” and only moved clothing and personal items there. He visited his home and family in Jackson Hole “at every opportunity,” returning for holidays, birthdays, anniversaries, and his daughter’s prom and high school graduation. He continued using financial institutions in Wyoming, and kept his vehicle registration there. In 2008, the economy crashed and Aspen abandoned plans to expand the Little Nell Hotel brand. It became clear that Aspen would not be relocating Cherrett back to Jackson Hole. So in 2009, after Cherrett’s daughter graduated from high school and moved away to college, his wife joined him in Colorado and they sold their home in Jackson Hole. In 2011, four years after joining Aspen, Cherrett resigned from his position.