What changed in this filing

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Item 1. Business

2020-09-24 compared with 2019-09-26 · 187 added, 236 removed, 273 unchanged (61% of the section changed)

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Mountain, Lodging and Real Estate, which represented approximately 87%, 13% and 0%, respectively, of our net revenue for our fiscal year ended July 31, 2020 (“Fiscal 2020”).

As of July 31, 2019, our Mountain segment operates seventeen world-class mountain resort properties and three urban ski areas, as well as ancillary services, primarily including:

retail/rental operations.

Our Lodging segment includes the following:

owned and/or managed luxury hotels under our RockResorts brand, as well as other strategic lodging properties,

owned and/or managed condominiums located in proximity to our mountain resorts,

certain National Park Service (“NPS”) concessionaire properties, including Grand Teton Lodge Company (“GTLC”), which operates destination resorts at Grand Teton National Park,

a Colorado resort ground transportation company, and

mountain resort golf courses.

As of July 31, 2020, our Mountain segment operates thirty-seven world-class destination mountain resorts and regional ski areas (collectively, our “Resorts”).

Additionally, the Mountain segment includes ancillary services, primarily including ski school, dining and retail/rental operations.

In the Lodging segment, we own and/or manage a collection of luxury hotels and condominiums under our RockResorts brand;

other strategic lodging properties and a large number of condominiums located in proximity to our North American mountain resorts;

National Park Service (“NPS”) concessionaire properties including the Grand Teton Lodge Company (“GTLC”), which operates destination resorts in Grand Teton National Park;

a Colorado resort ground transportation company and mountain resort golf courses.

We refer to “Resort” as the combination of the Mountain and Lodging segments.

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“Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Item 8.

“Financial Statements and Supplementary Data” below.

Peak Resorts Acquisition

On September 24, 2019, through a wholly-owned subsidiary, we acquired 100 percent of the outstanding stock of Peak Resorts, Inc.

(“Peak Resorts”) at a purchase price of $11.00 per share or approximately $265 million.

Through the acquisition we added 17 U.S.

ski areas to our network of resorts, which are located near major metropolitan areas including New York, Boston, Washington D.C., Baltimore, Philadelphia, Cleveland, St.

Louis, Kansas City, and Louisville.

The newly acquired resorts in the Northeast include Mount Snow in Vermont;

Hunter Mountain in New York;

and Attitash Mountain Resort, Wildcat Mountain and Crotched Mountain in New Hampshire.

In the Mid-Atlantic, the newly acquired resorts include Liberty Mountain Resort, Roundtop Mountain Resort, Whitetail Resort, Jack Frost and Big Boulder in Pennsylvania.

In the Midwest, the newly acquired resorts include Alpine Valley, Boston Mills, Brandywine and Mad River Mountain in Ohio;

Hidden Valley and Snow Creek in Missouri;

and Paoli Peaks in Indiana.

The ski areas owned by Peak Resorts offer a breadth of activities, services and amenities, including skiing, snowboarding, terrain parks, tubing, dining, lodging, equipment rentals and sales, ski and snowboard instruction, mountain biking, golf and other summer activities.

Due to the timing of closing, we have not incorporated information pertaining to Peak Resorts throughout Part I, Item I, Business, unless explicitly noted.

For additional information, see the Notes to the Consolidated Financial Statements.

“Financial Statements and Supplementary Data.”

COVID-19 Impact

On March 14, 2020, we announced a temporary closure of our North American Resorts and retail/rental operations as a result of the COVID-19 pandemic and as a precautionary measure for the safety of our guests and employees beginning on March 15, 2020.

Subsequently on March 17, 2020, we announced the early closure of the 2019/2020 North American ski season for our North American Resorts, lodging properties and retail stores.

Additionally, the ongoing impacts of the COVID-19 pandemic resulted in restrictions, limitations or closures of our 2020 Australian ski area operations and 2020 North American summer operations.

Two of our Australian ski areas, Mount Hotham and Falls Creek, opened for their 2020 winter season on July 6, 2020, but we decided to close them four days later due to a “stay at home” order put in place by the Victorian government and specifically for the Melbourne metropolitan area, which represents the majority of visitors for Mount Hotham and Falls Creek, as a result of a reemergence of COVID-19 in the region.

These actions and the risks, trends and uncertainties related to COVID-19 are discussed in further detail throughout this document because the COVID-19 pandemic has had a significant adverse impact on our results of operations for Fiscal 2020 and is expected to have a continued negative impact on our results of operations for the year ending July 31, 2021 (“Fiscal 2021”).

Mountain Segment

Our portfolio of world-class mountain resorts and urban ski areas includes:

*Denotes a mountain resort or urban ski area that was acquired subsequent to Fiscal 2019 in the Peak Resorts transaction and therefore is not included in the consolidated financial results of the Company as of or for the year ended July 31, 2019.

United States

Colorado and Utah Resorts (Rocky Mountain Region)

In the Mountain segment, the Company operates the following 37 destination mountain resorts and regional ski areas, including six resorts within the top ten most visited resorts in the United States for the 2019/2020 North American ski season, as well as Whistler Blackcomb, the most visited resort in North America:

*Denotes a destination mountain resort, which generally receives a meaningful portion of skier visits from long-distance travelers, as opposed to our regional ski areas, which tend to generate skier visits predominantly from their respective local markets.

Our Mountain segment derives revenue through the sale of lift tickets, including pass products, as well as a comprehensive offering of amenities available to guests, including ski and snowboard lessons, equipment rentals and retail merchandise sales, a variety of dining venues, private club operations and other winter and summer recreational activities.

In addition to providing extensive guest amenities, we also lease some of our owned and leased commercial space to third party operators to add unique restaurants and retail stores to the mix of amenities at the base of our resorts.

Many of our destination mountain resorts are year-round mountain resorts that provide a comprehensive resort experience to a diverse clientele with an attractive demographic profile.

We offer a broad complement of winter and summer recreational activities, including skiing, snowboarding, snowshoeing, snowtubing, sightseeing, mountain biking, guided hiking, zip lines, challenge ropes courses, alpine slides, mountain coasters, children’s activities and other recreational activities.

Collectively, our Resorts are located in close proximity to population centers totaling over 100 million people.

Destination Mountain Resorts

The below U.S.

visitation data for the 2019/2020 ski season is representative of visitation through mid-March 2020, at which point our Resorts closed early for the season as a result of the COVID-19 pandemic, and therefore the visitation results are not necessarily comparable to a full ski season.

Rocky Mountains (Colorado and Utah Resorts)

Breckenridge Ski Resort (“Breckenridge”) - the most visited mountain resort in the United States (“U.S.”) for the 2019/2020 ski season with five interconnected peaks offering an expansive variety of terrain for every skill level, including access to above tree line intermediate and expert terrain, and progressive and award-winning terrain parks.

Vail Mountain Resort (“Vail Mountain”) - the second most visited mountain resort in the U.S.

for the 2018/2019 ski season.

Vail Mountain offers some of the most expansive and varied terrain in North America with approximately 5,300 skiable acres including seven world renowned back bowls and the resort’s rustic Blue Sky Basin.

Park City Resort (“Park City”) - the third most visited mountain resort in the U.S.

Park City Resort (“Park City”) - the second most visited mountain resort in the U.S.

for the 2019/2020 ski season and the largest by acreage in the U.S.

Park City offers 7,300 acres of skiable terrain for every type of skier and snowboarder and offers guests an outstanding ski experience with fine dining, ski school, retail and lodging.

Keystone Resort (“Keystone”) - the fifth most visited mountain resort in the U.S.

Vail Mountain Resort (“Vail Mountain”) - the third most visited mountain resort in the U.S.

for the 2019/2020 ski season.

Keystone Resort (“Keystone”) - the fourth most visited mountain resort in the U.S.

for the 2019/2020 ski season and home to the highly renowned A51 Terrain Park, as well as the largest area of night skiing in Colorado.

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Keystone is a premier destination for families with its “Kidtopia” program focused on providing activities for kids on and off the mountain.

Beaver Creek Resort (“Beaver Creek”) - the tenth most visited mountain resort in the U.S.

Beaver Creek Resort (“Beaver Creek”) - the ninth most visited mountain resort in the U.S.

for the 2019/2020 ski season.

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Crested Butte is known for its historic town, iconic mountain peaks and legendary skiing and riding terrain.

Pacific Northwest (British Columbia, Canada)

Whistler Blackcomb (“Whistler Blackcomb”) - located in the Coast Mountains of British Columbia, Canada, approximately 85 miles from the Vancouver International Airport, Whistler Blackcomb is the most visited and largest year-round mountain resort in North America, with two mountains connected by the PEAK 2 PEAK gondola, which combined offer over 200 marked runs, over 8,000 acres of terrain, 14 alpine bowls, three glaciers and one of the longest ski seasons in North America.

In the summer Whistler Blackcomb offers a variety of activities, including hiking trails, a bike park and sightseeing.

Whistler Blackcomb is a popular destination for international visitors and was home to the 2010 Winter Olympics.

Lake Tahoe Resorts

Heavenly Mountain Resort (“Heavenly”) - the eleventh most visited mountain resort in the U.S.

Heavenly Mountain Resort (“Heavenly”) - the tenth most visited mountain resort in the U.S.

for the 2019/2020 ski season.

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Heavenly offers great nightlife, including its proximity to several casinos.

Northstar Resort (“Northstar”) - Northstar, located near the North Shore of Lake Tahoe, is the premier luxury mountain resort destination near Lake Tahoe which offers premium lodging, a vibrant base area and over 3,000 skiable acres.

Northstar Resort (“Northstar”) - located near the North Shore of Lake Tahoe, Northstar is the premier luxury mountain resort destination near Lake Tahoe which offers premium lodging, a vibrant base area and over 3,000 skiable acres.

Northstar’s village features high-end shops and restaurants, a conference center and a 9,000 square-foot skating rink.

Kirkwood Mountain Resort (“Kirkwood”) - located about 35 miles southwest of South Lake Tahoe, offering a unique location atop the Sierra Crest.

Kirkwood is recognized for offering some of the best high alpine advanced terrain in North America with 2,000 feet of vertical drop and over 2,300 acres of terrain.

Northeast Resorts

Stowe Mountain Resort (“Stowe”) - acquired in June 2017, Stowe is a premier mountain resort located in Northern Vermont which offers high-end lodging and dining options.

The mountain offers 116 trails on 485 skiable acres, with a variety of terrain for skiers of all skill levels.

Okemo Mountain Resort (“Okemo”) - acquired in September 2018, Okemo is located in southern Vermont, approximately three hours from Boston and four hours from New York City, and has developed a reputation for superior guest service, snow quality, grooming, terrain parks and family programs.

Okemo offers 667 acres of skiable terrain with the most vertical feet of skiing in southern Vermont.

Mount Sunapee Resort - (“Mount Sunapee”) - acquired in September 2018, Mount Sunapee is the premier ski area in southern New Hampshire, located approximately 90 minutes from Boston.

Mount Sunapee is a family-focused ski area overlooking Lake Sunapee, with excellent snowmaking and grooming across its 230 skiable acres with a variety of terrain for skiers of all skill levels, including four terrain parks.

Pacific Northwest Resort

Kirkwood Mountain Resort (“Kirkwood”) - located about 35 miles southwest of South Lake Tahoe, offering a unique location atop the Sierra Crest, Kirkwood is recognized for offering some of the best high alpine advanced terrain in North America with 2,000 feet of vertical drop and over 2,300 acres of terrain.

Regional Ski Areas

Our ski resort network allows us to connect guests with drive-to access and destination resort access on a single season pass product.

Building a presence near major metropolitan areas with large populations enables us to drive advanced commitment pass sales among a broad array of guests.

We own and operate eight regional ski areas in the Northeast that we believe provide a compelling regional and local connection to guests within driving distance from the New York, Boston and the greater New England markets.

Stowe is the premier, high-end regional ski area in the Northeast offering outstanding skiing and an exceptional base area experience.

Okemo and Mount Snow are compelling regional destinations serving guests in the New York metropolitan area and throughout New England.

Hunter Mountain is a day-trip ski area primarily serving the New York metropolitan area.

Additionally, we own four ski areas in New Hampshire serving guests throughout New England.

Mid-Atlantic (Pennsylvania)

We own and operate five ski areas in the Mid-Atlantic region serving guests in Philadelphia, Southern New Jersey, Baltimore and Washington D.C.

Our presence in the region allows us to offer compelling local options and easy overnight weekend and holiday trips to our premium Northeast regional ski areas, which are within driving distance from these markets.

We own and operate ten ski areas in the Midwest that draw guests from Chicago, Detroit, Minneapolis, St.

Louis, Indianapolis, Cleveland, Columbus, Kansas City and Louisville.

Located within close proximity to major metropolitan markets, these ski areas provide beginners with easy access to beginner ski programs and offer night skiing for young adults and families.

Additionally, the proximity of these ski areas allows for regular usage by avid skiers.

Pacific Northwest (U.S.)

Stevens Pass Resort (“Stevens Pass’’) - acquired in August 2018, Stevens Pass is located less than 85 miles from Seattle and sits on the crest of Washington State’s Cascade Range.

Stevens Pass offers 1,125 acres of skiable terrain, including 52 runs and numerous bowls, glades and faces.

Urban Ski Areas

Afton Alps Ski Area (“Afton Alps”), located near the Minneapolis/St.

Paul metropolitan area, is the largest ski area near a major city in the Midwest and offers 48 trails, with night skiing, riding and tubing.

Mount Brighton Ski Area (“Mt.

Brighton”), located near Detroit, offers 26 trails with night skiing and riding.

Wilmot Mountain (“Wilmot” ), located in southern Wisconsin, is near the Chicago metropolitan area and offers 25 trails, four terrain parks, a ski and snowboard school, a ski racing program and a tubing hill.

International Resorts

Whistler Blackcomb (“Whistler Blackcomb”) - acquired in October 2016 and located in the Coast Mountains of British Columbia, Canada, approximately 85 miles from the Vancouver International Airport, Whistler Blackcomb is the most visited and largest year-round mountain resort in North America, with two mountains connected by the PEAK 2 PEAK gondola, which combined offer over 200 marked runs, over 8,000 acres of terrain, 14 alpine bowls, three glaciers and one of the longest ski seasons in North America.

In the summer Whistler Blackcomb offers a variety of activities, including hiking trails, a bike park and sightseeing.

Whistler Blackcomb is a popular destination for international visitors and was home to the 2010 Winter Olympics.

Perisher Ski Resort (“Perisher”) - located in New South Wales, Australia, Perisher provides accessibility, significant lodging and the market’s most skiable acreage for the country’s largest cities, including Sydney, Melbourne, Adelaide,

Canberra and Brisbane.

Perisher offers over 3,000 skiable acres on seven peaks and includes the resort areas known as Perisher Valley, Smiggin Holes, Blue Cow and Guthega, along with ski school, lodging, food and beverage, retail/rental and transportation operations.

Falls Creek Alpine Resort (“Falls Creek”) - acquired in April 2019, Falls Creek is the largest ski resort in Victoria, Australia with over 1,100 skiable acres.

Falls Creek features a variety of terrain that is well suited to families and first-timers.

Additionally, the resort provides a variety of different lodging properties alongside restaurants, bars, and nightlife offerings.

Hotham Alpine Resort (“Hotham”) - acquired in April 2019 and located in Victoria, Australia.

Hotham is considered the “Powder Capital” of Australia, and is the only resort in the Southern Hemisphere where the village is located on top of the mountain, providing outstanding views and ski-in, ski-out opportunities from anywhere in the village with over 790 skiable acres.

Our resorts in Colorado, Utah, Lake Tahoe, Vermont, New Hampshire, Washington State and British Columbia, Canada are year-round mountain resorts that provide a comprehensive resort experience to a diverse clientele with an attractive demographic profile.

Our resorts offer a broad complement of winter and summer recreational activities, including skiing, snowboarding, snowshoeing, snowtubing, sightseeing, mountain biking, guided hiking, zip lines, challenge ropes courses, alpine slides, mountain coasters, children’s activities and other recreational activities.

Please see section above titled “Peak Resorts Acquisition” for our recently completed acquisition of Peak Resorts, which has not been incorporated in detail into this Part I of our Form 10-K, unless explicitly noted.

Stevens Pass offers terrain for all levels across 1,125 acres of skiable terrain.

Australia is an important market for both domestic skiing during the Australian winter and as a source of international visitation to the Northern Hemisphere in the Australian off-season, with over one million estimated Australian skier visits annually to North America, Europe and Japan.

We own three of the five largest ski areas in Australia, which we serve with the Epic Australia Pass, an Australian dollar denominated pass product marketed specifically to Australian guests.

Perisher, located in New South Wales, is the largest ski resort in Australia and targets guests in the Sydney metropolitan area and the broader New South Wales market, while Falls Creek and Mount Hotham are two of the largest ski areas in Victoria and target guests in the Melbourne metropolitan area and the broader Victoria market.

Ski Industry/Competition

There are approximately 770 ski areas in North America with approximately 475 in the U.S., ranging from small ski area operations that service day skiers to large resorts that attract both day skiers and destination resort guests looking for a comprehensive vacation experience.

We have a large presence in the Rocky Mountain region and the Lake Tahoe region, and also operate resorts in the Pacific Northwest and Northeast.

During the 2018/2019 North American ski season, combined skier visits for all ski areas in North America were approximately 79.7 million.

Our North American mountain resorts and urban ski areas, owned as of July 31, 2019, had approximately 13.8 million skier visits during the 2018/2019 ski season representing approximately 17.3% of North American skier visits.

During the 2019/2020 North American ski season, combined skier visits for all ski areas in North America were approximately 68.2 million, which was lower than historical levels due to the COVID-19 pandemic and resulting early resort closures in March across the United States and Canada.

During the 2018/2019 North American ski season (the ski season immediately prior to the outbreak of the COVID-19 pandemic), combined skier visits for all ski areas in North America were approximately 79.7 million.

Our North American Resorts had approximately 12.4 million skier visits during the 2019/2020 ski season, representing approximately 18.2% of North American skier visits.

There is limited opportunity for development of new destination ski resorts due to the limited private lands on which ski areas can be built, the difficulty in obtaining the appropriate governmental approvals to build on public lands and the significant capital needed to construct the necessary infrastructure.

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Additionally, our pass products compete with other multi-resort frequency and pass products in North America, including the IKON Pass, the Mountain Collective Pass and various regional and local pass products.

The ski industry statistics stated in this section have been derived primarily from data published by Colorado Ski Country USA, Canadian Ski Council, Kottke National End of Season Survey 2018/2019 (the “Kottke Survey”) as well as other industry publications.

Our Competitive Strengths

Our premier resorts and business model differentiate our Company from the rest of the ski industry.

We have iconic, branded mountain resorts in important ski destinations in Colorado, Utah, Lake Tahoe, the Northeast and the Pacific Northwest, including British Columbia, Canada.

Through our sales of pass products, we provide our guests with a strong value proposition in return for guests committing to ski at our resorts prior to, or very early into the ski season, which we believe attracts more guests to our

We believe we invest in more capital improvements than our competitors and we create synergies by operating multiple resorts, which enhances our profitability by enabling customers to access our network of resorts with our pass products.

Most of our mountain resorts located in the U.S.

We own and operate some of the most iconic, branded destination mountain resorts in geographically diverse and important ski destinations in Colorado, Utah, Lake Tahoe and the Pacific Northwest, including British Columbia, Canada.

These resorts are complemented by regional ski areas in the Northeast, Pacific Northwest, Midwest and Mid-Atlantic regions, which are strategically positioned near key U.S.

population centers, as well as three ski areas in Australia.

Through our data-driven marketing analytics and personalized marketing capabilities, we target increased penetration of ski pass products, providing our guests with a strong value proposition in return for guests committing to ski at our resorts prior to, or very early into the ski season, which we believe attracts more guests to our resorts.

believe we invest in more capital improvements than our competitors and we create synergies by operating multiple resorts, which enhances our profitability by enabling customers to access our network of resorts with our pass products.

Most of our destination mountain resorts located in the U.S.

typically rank in the most visited ski resorts in the U.S.

(five of the top ten for the 2018/2019 U.S.

ski season), and most of our mountain resorts consistently rank in the top ranked ski resorts in North America according to industry surveys, which we attribute to our mountain resorts’ ability to provide a high-quality experience.

(six of the top ten for the 2019/2020 U.S.

ski season), and most of our destination mountain resorts consistently rank in the top ranked ski resorts in North America according to industry surveys, which we attribute to our ability to provide a high-quality experience.

We believe the following factors contribute directly to each Resort’s success:

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Even in these areas which receive abundant snowfall, we have invested in significant snowmaking systems that help provide a more consistent experience, especially in the early season.

Our calendar year 2019 capital plan includes a significant investment in our snowmaking systems in Colorado that will transform the early-season terrain experience at Vail, Keystone and Beaver Creek.

Our mountain resorts in the Northeast U.S.

and in Australia receive less snowfall than our western North American mountain resorts, but we have invested in snowmaking operations at these resorts in order to provide a consistent experience for our guests.

During Fiscal 2020, we completed significant investments in our snowmaking systems in Colorado that transformed the early-season terrain experience at Vail, Keystone and Beaver Creek.

Our other ski areas receive less snowfall than our western North American mountain resorts, but we have invested in snowmaking operations at these resorts in order to provide a consistent experience for our guests.

Additionally, we provide several hundred acres of groomed terrain at each of our mountain resorts with extensive fleets of snow grooming equipment.

We systematically upgrade our lifts and put in new lifts to increase uphill capacity and streamline skier traffic to maximize the guest experience.

In the past several years, we have installed several high speed chairlifts and gondolas across our mountain resorts, including a new 10-person gondola running from the base to the top of Blackcomb Mountain, replacing the Wizard and Solar four person chairs with a single state-of-the-art gondola;

upgrading the four-person Emerald express chairlift to a high speed six-person chairlift on Whistler Mountain;

upgrading the three-person fixed grip Catskinner chairlift to a four-person high speed lift at Blackcomb Mountain;

upgrading the fixed grip High Meadow chair to a four person high speed lift at the Canyons area of Park City;

replacing the Galaxy two-person chairlift with a three-person chairlift at Heavenly, new high speed, six-passenger chairlift replacements for each of the Northwoods lift at Vail Mountain, the Peak 10 Falcon SuperChair at Breckenridge and the Montezuma lift at Keystone;

a new high speed, four person chair replacement for the Drink of Water chair at Beaver Creek;

a high speed quad replacement for the Sun Up chairlift at Vail Mountain and several lift replacements at Wilmot.

For the 2019/2020 ski season, planned upgrades to various chairlifts include the Daisy and Brooks lifts at Stevens Pass;

the Teocalli lift at Crested Butte;

the Tombstone lift at Park City and completion of the new Leichardt lift at Perisher.

In the past several years, we have installed or upgraded several high speed chairlifts and gondolas across our mountain resorts, including:

upgrading the Daisy and Brooks fixed-grip lifts at Stevens Pass to four-person high-speed lifts;

upgrading the Teocalli fixed-grip lift at Crested Butte to a four-person high-speed lift;

installing a new four-person lift at Park City, Over and Out;

replacing the Leichardt T-bar lift at Perisher with a new four-person lift;

installing a new 10-person gondola running from the base to the top of Blackcomb Mountain, replacing the Wizard and Solar four person chairs with a single state-of-the-art gondola;

upgrading the four-person Emerald express lift to a high speed six-person lift on Whistler Mountain;

upgrading the three-person fixed grip Catskinner lift to a four-person high speed lift at Blackcomb Mountain;

upgrading the fixed-grip High Meadow lift to a four-person high speed lift at the Canyons area of Park City;

replacing the Galaxy two-person lift with a three-person lift at Heavenly,

replacing each of the Northwoods lift at Vail Mountain, the Peak 10 Falcon SuperChair at Breckenridge and the Montezuma lift at Keystone with new high speed, six-passenger lifts;

upgrading the Drink of Water lift at Beaver Creek with a new high speed, four-person lift.

On April 1, 2020 we announced a reduction in our capital plan for calendar year 2020 in order to maintain a strong liquidity position in response to the COVID-19 pandemic.

The vast majority of these savings will result from the deferral of many of our discretionary capital projects.

We are planning to defer all new chair lifts, terrain expansions and other mountain and base area improvements, while continuing with the vast majority of our maintenance capital spending.

Terrain Parks

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We offer EpicMix, an online and mobile application that, through radio frequency technology, captures a guest’s activity on the mountain (e.g.

number of ski days, vertical feet skied and chairlift activity), allows a guest to share his or her experience, photos and accomplishments with family and friends on social

networks, allows guests to access real time lift line wait times and allows our ski school instructors to certify the attainment of certain skills and ski levels.

We also introduced the world’s first digital mountain assistant (“EMMA”), which uses artificial intelligence and natural language processing to offer information on everything from grooming, lift line wait times and parking, in addition to recommendations on rentals, lessons and dining options.

For the 2019/2020 North American ski season, we plan to make technology investments to increase lift ticket express fulfillment capacity through new mobile technology across our 17 North American resorts to allow skiers and snowboarders who purchased lift tickets in advance on-line to bypass the ticket window entirely.

Additionally, we are focused on improving the guest ski/snowboard rental experience with the development of a new “pod” concept in several of our high-volume locations where the guest is no longer required to wait in a number of different lines during their rental experience.

number of ski days, vertical feet skied and chairlift activity);

allows a guest to share his or her experience, photos and accomplishments with family and friends on social networks;

allows guests to access real time lift line wait times;

and allows our ski school instructors to certify the attainment of certain skills and ski levels.

We also offer the world’s first digital mountain assistant (“EMMA”), which uses artificial intelligence and natural language processing to offer information on everything from grooming, lift line wait times and parking, in addition to recommendations on rentals, lessons and dining options.

We have also invested in lift ticket express fulfillment through new mobile technology by allowing lift ticket purchasers that buy online to bypass the ticket window.

Additionally, we are focused on improving the guest ski/snowboard rental experience by eliminating the need for a guest to wait in several lines with the recent introduction of a new “pod” concept in several of our high-volume locations.

We also solicit guest feedback through a variety of surveys and results, which are used to ensure high levels of customer satisfaction, understand trends and develop future resort programs and amenities.

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Season Pass & Epic Day Pass Products

We offer a variety of pass products, primarily season pass and Epic Day Pass products, for all of our mountain resorts and urban ski areas that are marketed towards both out-of-state and international (“Destination”) guests as well as in-state and local (“Local”) guests.

We offer a variety of pass products, primarily season pass and Epic Day Pass products, for all of our Resorts that are marketed towards both out-of-state and international (“Destination”) guests as well as in-state and local (“Local”) guests.

These pass products are available for purchase prior to the start of the ski season, offering our guests a better value in exchange for their commitment to ski at our Resorts before the season begins.

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Additionally, our pass product customers typically ski more days each season than those guests who do not buy pass products, which leads to additional ancillary spending.

Our pass products generated approximately 47% of our total lift revenue for Fiscal 2019.

In addition, our pass products attract new guests to our mountain resorts and urban ski areas.

Sales of pass products are a key component of our overall Mountain segment revenue and help create strong synergies among our mountain resorts and urban ski areas.

Our pass products range from providing access for a certain number of days to one or a combination of our mountain resorts and urban ski areas to our Epic Pass which provides unrestricted and unlimited access to all our mountain resorts and urban ski areas.

Additionally, beginning with the 2019/2020 North American pass product selling season, we are offering the Epic Day Pass, a customizable one to seven day pass product, purchased in advance of the season, for those skiers and riders who expect to ski a certain number of days during the season.

Our pass products generated approximately 51% of our total lift revenue for Fiscal 2020, which includes the effects of the early closure of our Resorts as well as the deferral of approximately $121 million of pass product revenue from Fiscal 2020 into Fiscal 2021 as a result of pass credits that we offered to 2019/2020 pass holders who renewed for the 2020/2021 ski season.

In addition, our pass products attract new guests to our Resorts.

Sales of pass products are a key component of our overall Mountain segment revenue and help create strong synergies among our Resorts.

Our pass products range from providing access for a certain number of days to one or a combination of our Resorts to our Epic Pass which provides unrestricted and unlimited access to all of our Resorts.

The Epic Day Pass is a customizable one- to seven-day pass product, purchased in advance of the season, for those skiers and riders who expect to ski a certain number of days during the season.

All of our various pass product options can be found on our consumer website www.snow.com.

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As part of our continued strategy to drive pass product sales and create a stronger connection between key skier markets and our iconic destination mountain resorts, we have continued to expand our portfolio of properties in recent years.

In September 2019, we acquired Peak Resorts, Inc., which added 17 regional ski areas strategically located near key U.S.

population centers in the Northeast, Mid-Atlantic and Midwest regions.

In April 2019, we acquired Falls Creek and Hotham, located in Victoria, Australia, expanding our portfolio of Australian ski resorts to complement Perisher, which we acquired in June 2015.

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recently, including Okemo in Vermont (acquired in September 2018), Mount Sunapee in New Hampshire (acquired in September 2018) and Stowe in Vermont (acquired in June 2017).

These resorts are premier, high-end ski resorts for skiers and snowboarders on the East Coast, which draw visitors from New York City, Boston and the broader Northeast skier population.

Additionally, our urban ski areas are strategically positioned near key U.S.

population centers;

Wilmot in Wisconsin near the Chicago and Milwaukee metropolitan areas, Afton Alps in Minnesota near Minneapolis/St.

Brighton in Michigan near Detroit.

This close proximity to major Midwestern skier markets allows guests to visit regularly during the week, including popular night skiing, or on the weekends.

These cities offer major airports with routine direct flights to Denver, San Francisco, Salt Lake City and Vancouver.

Additionally, we enter into strategic long-term season pass alliance agreements with third-party mountain resorts including Telluride Ski Resort in Colorado, Sun Valley Resort in Idaho, Snowbasin Resort in Utah, Hakuba Valley and Rusutsu Resort in Japan, Resorts of the Canadian Rockies in Canada, Les 3 Vallées in France, 4 Vallées in Switzerland and Skirama Dolomiti in Italy, which further increases the value proposition of our pass products.

These ski areas are premier, high-end ski destinations for skiers and snowboarders on the East Coast, which draw visitors from New York City, Boston and the broader Northeast skier population.

Resorts of the Canadian Rockies in Canada, Les 3 Vallées in France, 4 Vallées in Switzerland, Skirama Dolomiti in Italy and Ski Arlberg in Austria, which further increases the value proposition of our pass products.

As a result of the COVID-19 pandemic, we closed our North American Resorts and retail stores beginning on March 15, 2020.

To encourage our pass product holders to renew their pass purchases for next season following the early closures this spring, we announced a credit offer for all existing 2019/2020 North American ski season pass product holders to purchase 2020/2021 North American ski season pass products at a discount (the “Credit Offer”).

The Credit Offer provides discounts ranging from a minimum of 20% to a maximum of 80% for season pass holders, depending on the number of days the pass holder used their pass product during the 2019/2020 season and a credit, with no minimum, but up to 80% for multi-day pass products, such as the Epic Day Pass, based on total unused days.

We also announced that we would be implementing a reservation system for our 34 North American Resorts for the 2020/2021 North American ski season, which will only be available for pass holders during the early season (paid lift tickets will not be sold until December 8, 2020).

For the upcoming 2020/2021 North American ski season, we have introduced Epic Mountain Rewards;

a program which gives pass product holders a discount of 20% off on-mountain food and beverage, lodging, group ski and ride school lessons, equipment rentals and more at the Company’s North American Resorts.

Epic Mountain Rewards is available for everyone who purchases an Epic Pass, Epic Local Pass, Epic Day Pass, Epic Military Pass and most of our other pass products, regardless of whether guests plan to ski one day or every day of the season.

Additionally, we introduced Epic Coverage for the 2020/2021 North American ski season, which is free for all pass holders, completely replaces the need for pass insurance, and provides expanded coverage over our historical pass insurance program.

Epic Coverage provides refunds in the event of certain resort closures (e.g.

for COVID-19), giving pass product holders a refund for any portion of the season that is lost due to qualifying circumstances.

Additionally, Epic Coverage provides a refund for personal circumstances that were historically covered by our pass insurance program, such as eligible injuries, job losses and many other personal events, as well as in the event that the pass holder cannot reserve their preferred days.

Premier Ski Schools

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Our Resorts provide a variety of quality on-mountain and base village dining venues, ranging from top-rated fine dining restaurants to trailside express food service outlets.

We operate approximately 215 dining venues at our mountain resorts and urban ski areas.

We normally operate approximately 310 dining venues at our Resorts, although there will be some restrictions or limitations for the upcoming 2020/2021 North American ski season as a result of the impacts of COVID-19 and to ensure the safety of our guests and employees.

Food options in quick-service restaurants will be more limited this season, with just a handful of ready-to-go hot and cold options and no ability for any custom or special orders.

We will be spacing tables in seating areas as well to allow for physical distancing while eating, and we will also be maintaining as much outdoor seating as we can.

Retail/Rental

We have approximately 330 retail/rental locations specializing in sporting goods including ski, snowboard and cycling equipment.

In addition to providing a major retail/rental presence at each of our mountain resorts, we also have retail/rental locations throughout the Colorado Front Range and at other Colorado and California ski resorts, as well as the San Francisco Bay Area, Salt Lake City and Minneapolis.

Many of the locations in the Colorado Front Range and in the San Francisco Bay Area also offer prime venues for selling our pass products.

In addition to providing a major retail/rental presence at each of our Resorts, we also have retail/rental locations throughout the Colorado Front Range, the San Francisco Bay Area, Salt Lake City and Minneapolis.

Many of our retail/rental locations near key population centers also offer prime venues for selling our pass products.

On-Mountain Activities

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In addition to our exceptional ski experiences, guests can choose from a variety of non-ski related activities such as snowtubing, snowshoeing, guided snowmobile and scenic snow cat tours, backcountry expeditions, horse-drawn sleigh rides and high altitude dining.

During the summer season, our mountain resorts offer non-ski related recreational activities and provide guests with a wide array of options including scenic chairlift and gondola rides;

During a normal summer season, our mountain resorts offer non-ski related recreational activities and provide guests with a wide array of options including scenic chairlift and gondola rides;

mountain biking;

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4x4 Jeep tours;

and our Epic Discovery program at Vail Mountain, Heavenly and Breckenridge.

and our Epic Discovery program at Vail Mountain, Heavenly and Breckenridge, although some of these activities were restricted or limited for the most recent summer season as a result of the impacts of COVID-19 and to ensure the safety of our guests and employees.

The Epic Discovery program encourages “learn through play” by featuring extensive environmental educational elements interspersed between numerous activities, consisting of zip lines, children’s activities, challenge ropes courses, tubing, mountain excursions, an alpine slide and alpine coasters.

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Our owned and managed hotels and resorts proximate to our mountain resorts, including six RockResorts branded properties and a significant inventory of managed condominium units, provide numerous accommodation options for our mountain resort guests.

More recently, our real estate efforts have focused on the potential to expand our destination bed base and upgrade our resorts through the sale of land parcels to third-party developers which in turn provides opportunity for the development of condominiums, luxury hotels, parking and commercial space for restaurants and retail shops.

Our recent real estate efforts have primarily focused on the potential to expand our destination bed base and upgrade our resorts through the sale of land parcels to third-party developers, which in turn provides opportunity for the development of condominiums, luxury hotels, parking and commercial space for restaurants and retail shops.

Our Lodging and Real Estate segments have and continue to invest in resort related assets and amenities or seek opportunities to expand and enhance the overall resort experience.

Lodging Segment

Our Lodging segment includes the following operations, which collectively offer a wide range of services to guests (additional property details provided in Item 2.

Owned and managed lodging properties, including those under our luxury hotel management company, RockResorts;

Managed condominium units which are in and around our mountain resorts in Colorado, Lake Tahoe, Utah, Vermont and British Columbia, Canada;

Our Lodging segment includes owned and managed lodging properties, including those under our luxury hotel management company, RockResorts;

managed condominium units which are in and around our mountain resorts in Colorado, Lake Tahoe, Utah, Vermont, New York and British Columbia, Canada;

two NPS concessionaire properties in and near Grand Teton National Park in Wyoming;

a resort ground transportation company in Colorado;

Company-owned mountain resort golf courses including five in Colorado, one in Wyoming and two in Vermont, as well as two Company-operated mountain golf courses;

one in Lake Tahoe, California and one in Park City, Utah.

and company-owned and operated mountain resort golf courses, including five in Colorado;

one in Wyoming;

three in Vermont;

one in Lake Tahoe, California;

one in Park City, Utah;

and two in Pennsylvania.

For additional property details, see Item 2.

“Properties”.

The Lodging segment currently includes approximately 6,000 owned and managed hotel rooms and condominium units.

Our lodging strategy seeks to complement and enhance our mountain resort operations through our ownership or management of

lodging properties and condominiums proximate to our mountain resorts and selective management of luxury resorts in premier destination locations.

In addition to our portfolio of owned or managed luxury resort hotels and other hotels and properties, our lodging business also features a Colorado ground transportation company, which represents the first point of contact with many of our guests when they arrive by air to Colorado.

Our lodging strategy seeks to complement and enhance our mountain resort operations through our ownership or management of lodging properties and condominiums proximate to our mountain resorts and selective management of luxury resorts in premier destination locations.

In addition to our portfolio of owned and managed luxury resort hotels and other hotels and properties, our lodging business also features a Colorado ground transportation company, which represents the first point of contact with many of our guests when they arrive by air to Colorado.

We offer year-round ground transportation from Denver International Airport and Eagle County Airport to the Vail Valley (locations in and around Vail, Beaver Creek, Avon and Edwards), Aspen (locations in and around Aspen and Snowmass) and Summit County (which includes Keystone, Breckenridge, Copper Mountain, Frisco and Silverthorne).

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as of July 2020.

For Fiscal 2019, our owned hotels, which include a combination of certain RockResort hotels as well as other hotels in proximity to our mountain resorts, had an overall ADR of $256.50 a paid occupancy rate of 68.4% and revenue per available room (“RevPAR”) of $175.45, as compared to the upper upscale segment’s ADR of $188.88, a paid occupancy rate of 73.9% and RevPAR of $139.50.

For Fiscal 2020, our owned hotels, which include a combination of certain RockResort hotels as well as other hotels in proximity to our Resorts, had an overall ADR of $266.43, a paid occupancy rate of 45.9% and revenue per available room (“RevPAR”) of $122.34, as compared to the upper upscale segment’s ADR of $182.00, a paid occupancy rate of 53.5% and RevPAR of $97.30.

We believe that this comparison to the upper upscale segment is appropriate as our mix of owned hotels include those in the luxury and upper upscale segments, as well as certain of our hotels that fall in the upscale segment.

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GTLC’s operations within Grand Teton National Park and JHG&TC have operating seasons that generally run from June through the end of September.

As a result of the COVID-19 pandemic and in response to guidance from the NPS, the Centers for Disease Control and Prevention and other local and national health authorities, operations for the 2020 season were limited or adjusted.

This included closures of Jackson Lake Lodge and Jenny Lake lodge for the season, as well as the temporary closure of many facilities and restrictions on guided activities, in-restaurant dining and stayover housekeeping service for cabins.

We primarily compete with such companies as Aramark Parks & Resorts, Delaware North Companies Parks & Resorts, Forever Resorts and Xanterra Parks & Resorts in retaining and obtaining NPS concessionaire agreements.

Four full-service concessionaires provide accommodations within Grand Teton National Park, including GTLC.

GTLC offers three lodging options within Grand Teton National Park:

In a normal operating season, GTLC offers three lodging options within Grand Teton National Park:

Jackson Lake Lodge, a full-service, 385-room resort with 17,000 square feet of conference facilities;

Jenny Lake Lodge, a small, rustically elegant retreat with 37 cabins;

and Colter Bay Village, a facility with 166 log cabins, 66 tent cabins, 337 campsites and a 112-space RV park.

and Colter Bay Village, a facility with 166 log cabins, 66 tent cabins, 337 campsites and a 112-space recreational vehicle park.

GTLC offers dining options as extensive as its lodging options, with cafeterias, casual eateries and fine dining establishments.

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Marketing and Sales

Our Mountain segment’s marketing and sales efforts are increasingly oriented around data analytics to drive targeted and personalized marketing to our existing and prospective guests.

We capture guest data on the vast majority of guest transactions through our pass product sales program, e-commerce platforms including mobile lift ticket sales, the EpicMix application and operational processes at our lift ticket windows.

We promote our resorts using guest-centric marketing campaigns via email and direct mail, promotional programs, digital marketing (including social, search and display) and traditional media advertising where appropriate (e.g.

Our Mountain segment’s marketing and sales efforts are focused on leveraging marketing analytics to drive targeted and personalized marketing to our existing and prospective guests.

We capture guest data on the vast majority of guest transactions through sales of our pass products, our e-commerce platforms including mobile lift ticket sales, the EpicMix application and our lift ticket windows.

We promote our Resorts using guest-centric omni-channel marketing campaigns leveraging email, direct mail, promotional programs, digital marketing (including social, search and display) and traditional media advertising where appropriate (e.g.

targeted print, TV and radio).

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We also enter into strategic alliances with companies to enhance the guest experience at our Resorts, as well as to create opportunities for cross-marketing.

For our Lodging segment, we promote our hotels and lodging properties through marketing and sales programs, which include marketing directly to many of our guests through our digital channels (search, social and display), promotional programs, and print media advertising.

We also promote comprehensive vacation experiences through various package offerings and promotions (combining lodging, lift tickets, ski school lessons, ski rental equipment, transportation and dining), all of which are designed to drive traffic to our websites and central reservations call center.

In addition, our hotels have active sales forces to generate conference and group business.

We market our resort properties in conjunction with our mountain resort marketing efforts where appropriate, given the strong synergies across the two businesses.

Across both the Mountain and Lodging segments, sales made through our websites and call center allow us to transact directly with our guests, enabling us to further expand our customer base for future analytics and guest-centric marketing efforts.

Across both the Mountain and Lodging segments, sales made through our websites and call center allow us to transact directly with our guests, which further expands our customer base and enables analytics to deliver an increasingly guest-centric marketing experience.

Ski resort operations are highly seasonal in nature, with a typical ski season in North America generally beginning in mid-November and running through mid-April.

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We actively promote our extensive conference facilities and have added more off-season activities to help offset the seasonality of our lodging business.

Additionally, we operate ten golf courses:

The Canyons Golf Course at Park City, The Beaver Creek Golf Club, The Keystone Ranch Golf Course, The River Course at Keystone, JHG&TC near Jackson, Wyoming, The Northstar Resort Golf Course, the Tom Fazio and Greg Norman courses at Red Sky Ranch near the Beaver Creek Resort and the Okemo Valley Golf Club and Tater Hill Golf Club in Vermont.

Environmental Stewardship and Social Responsibility

Environmental stewardship is a core philosophy for us.

Additionally, we operate several golf courses proximate to our Resorts, as described above.

Sustainability and Social Responsibility

Sustainability is a core philosophy for us.

Our Resorts operate in some of the world’s greatest natural environments, and we are compelled to care for and conserve them.

Through our corporate social responsibility and sustainability program, Epic Promise, we focus on resource conservation, forest health and building stronger local communities through contributions to local non-profit organizations.

Our environmental stewardship efforts are diverse and touch nearly every area of our operations.

Our sustainability efforts are diverse and touch nearly every area of our operations.

In 2017, we launched our Commitment to Zero, a pledge to have a zero net operating footprint by 2030.

This commitment includes achieving zero net emissions by finding operational energy efficiencies, investing in renewable energy and investing in offsets and other emissions reduction projects, zero waste to landfills by diverting 100 percent of waste from our operations and zero net operating impact to forests and habitat by restoring an acre of forest for every acre displaced by our operations.

As a result of this commitment, Vail Resorts was accepted as the first travel and tourism company into RE100 , a collaborative initiative uniting more than 100 global and influential businesses which are committed to 100 percent renewable electricity.

In addition, we have partnered with several organizations to help raise resources for local environmental programs, including The Nature Conservancy, the National Forest Foundation, The Tahoe Fund, Mountain Trails Foundation in Park City and the EnviroFund at Whistler Blackcomb.

We encourage our employees to help protect the environment and support their local community with over 26,000 volunteer hours donated annually.

Our charitable giving focuses on supporting education and youth programs, encouraging innovation in, and implementation of, environmental stewardship practices and enhancing the quality of life in the communities in which we operate.

Finally, our EpicPromise Foundation (the “Foundation”), which was established in 2015, is a charitable foundation funded by annual contributions from the Company and its employees.

This commitment includes achieving zero net emissions by finding operational energy efficiencies, investing in renewable energy and investing in offsets and other emissions reduction projects, zero waste to landfills by diverting 100% of waste from our operations and zero net operating impact to forests and habitat by restoring an acre of forest for every acre displaced by our operations.

During Fiscal 2020, we made significant progress toward our Commitment to Zero goals.

Specifically, we reached our interim goal of achieving 50% waste diversion across the enterprise through waste reduction efforts as well as developing robust composting and recycling diversion programs.

We also enabled the new 82-turbine Plum Creek Wind project to come online and committed to purchase 310,000 megawatt hours (MWh) of wind energy annually.

This amount of wind power will address more than 90% of the Company’s current electricity use across its 34 North American destination mountain resorts and regional ski areas.

In addition, during Fiscal 2020, we sponsored the reforestation of 39 acres in the Gunnison National Forest in Colorado that had been damaged by bark beetle, which effort addressed 100% of the forests impacted by our operations over the year.

Through direct Epic Promise grants and contributions from our $1 guest donation program, we partner with several local environmental organizations to fund restoration projects, including the National Forest Foundation, The Tahoe Fund, Grand Teton National Park Foundation, Mountain Trails Foundation in Park City and the EnviroFund at Whistler Blackcomb.

We encourage our employees to help protect the environment and support their local community, with over 20,000 volunteer hours donated annually on average.

Our Epic Promise community investment grant program focuses support on local programs addressing marginalized youth and critical community needs.

During Fiscal 2020, we hosted more than 5,000 youth across our resorts through multi-day programs focused on mentorship, leadership and the impact of outdoor time on mental health.

Finally, our EpicPromise Employee Foundation (the “Foundation”), which was established in 2015, is a charitable foundation funded by annual contributions from the Company, its employees and its guests.

The Foundation supports Vail Resorts’ employees and their families via grants for emergency relief and scholarships.

Annually more than $1 million in grants and scholarships are provided to help employees in times of need or to pursue educational opportunities.

For more information on both the Foundation and our environmental stewardship, visit www.EpicPromise.com.

Information on our websites does not constitute part of this document.

At fiscal year end, we employed approximately 6,600 year-round employees.

During the height of our most recent operating seasons, we employed approximately 31,900 additional seasonal employees.

At fiscal year end, we employed approximately 7,100 year-round employees, including furloughed employees.

During the height of our most recent operating seasons (prior to the outbreak of the COVID-19 pandemic for our North American winter operations), we employed approximately 36,100 additional seasonal employees.

In addition, we employed approximately 200 year-round employees and 100 seasonal employees on behalf of the owners of our managed hotel properties.

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The Company licenses the right to use the federally registered trademark Northstar California ® from CLP Northstar, LLC.

Regulation and Legislation

Environmental Compliance and other Laws and Regulations

Our operations are subject to federal, state and local laws and regulations governing the environment including laws and regulations governing water and sewer discharges, water use, air emissions, soil and groundwater contamination, the maintenance of underground and aboveground storage tanks, and the disposal of waste and hazardous materials.

Examples of such laws and regulations in the U.S.

include the National Environmental Policy Act (NEPA), the California Environmental Quality Act, and the Vermont Land Use and Development Act.

Internationally, we are subject to the Forest and Range Practices Act and Watershed Sustainability Act in British Columbia as well as the Environmental Planning and Assessment Act 1979 (NSW, Australia) and the Environment Protection Act 1970 and the Environment Protection and Biodiversity Conservation Act 1999 (Victoria, Australia).

Various federal, state, local and provincial regulations also govern our resort operations, including liquor licensing and food safety regulations applicable to our food and beverage operations and safety standards relating to our lift operations and heli-ski operations at Whistler Blackcomb.

In addition, each resort is subject to and must comply with state, county, regional and local government land use regulations and restrictions, including, for example, employee housing ordinances, zoning and density restrictions, noise ordinances, and wildlife, water and air quality regulations.

We believe that we are in compliance, in all material respects, with environmental and other laws and regulations.

Compliance with such provisions has not materially impacted our capital expenditures, earnings, or competitive position, and we do not anticipate that it will have a material impact in the future.

Contracts with Governmental Authorities for Resort Operations

Forest Service Resorts

Federal Regulation

The operations of Breckenridge, Vail Mountain, Keystone, Beaver Creek, Crested Butte, Stevens Pass, Heavenly and Kirkwood are conducted primarily on land under the jurisdiction of the U.S.

The operations of Breckenridge, Vail Mountain, Keystone, Crested Butte, Stevens Pass, Heavenly, Kirkwood, Mount Snow, Attitash and portions of Beaver Creek and Wildcat are conducted on land under the jurisdiction of the U.S.

Forest Service (collectively, the “Forest Service Resorts”).

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Each individual national forest is required by the National Forest Management Act to develop and maintain a Land and Resource Management Plan (a “Forest Plan”), which establishes standards and guidelines for the Forest Service to follow and consider in reviewing and approving our proposed actions.

Special Use Permits

Each of the Forest Service Resorts operates under a SUP, and the acreage and expiration date information for each SUP is as follows:

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November 8, 2039

April 4, 2047

November 18, 2050

March 1, 2052

August 15, 2058

Crested Butte

September 27, 2058

August 15, 2058

March 1, 2052

We anticipate requesting a new SUP for each Forest Service Resort prior to its expiration date as provided by Forest Service regulations and the terms of each existing SUP.

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Permit amendments must be consistent with the Forest Plan and are subject to the provisions of the National Environmental Policy Act (“NEPA”), both of which are discussed below.

Master Development Plans

The 1986 Act requires a Master Development Plan (“MDP”) for each ski area that is granted a SUP, and all improvements that we propose to make on National Forest System lands under any of our SUPs must be included in a MDP, which describes the existing and proposed facilities, developments and area of activity within the permit area.

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We update or amend our MDPs for our Forest Service Resorts from time to time.

Private Land Resorts

The operations of Park City, Northstar, Afton Alps, Mt.

Brighton and Wilmot are conducted primarily on private land and are not under the jurisdiction of the Forest Service (collectively, the “Private Land Resorts”).

While Beaver Creek also operates on Forest Service land, a significant portion of the skiable terrain, primarily in the lower main mountain, Western Hillside, Bachelor Gulch and Arrowhead Mountain areas, is located on land that we own.

Although not governed by federal regulation, the Private Land Resorts may be governed by local laws and regulations.

For example, specific projects and master development plans at Northstar require approval by Placer County, California.

Additionally, a portion of Park City is part of the Canyons Specially Planned Area (“SPA”) pursuant to a Summit County, Utah ordinance adopted in 1998, and a Development Agreement and Master Development Plan with affected property owners, developers and the county, the most recent versions of which were adopted in 1999.

Other land use within the SPA is within the jurisdiction of Summit County, Utah.

Land use at Park City is within the jurisdiction of Summit County, Utah and Park City Municipal Corporation.

The portions of the resort located within Park City Municipal Corporation are subject to a Development Agreement with the municipality, the most recent version of which was entered into in 1998.

Whistler Blackcomb

Whistler Blackcomb is made up of two mountains:

Whistler Blackcomb is comprised of two mountains:

Whistler Mountain and Blackcomb Mountain.

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The MDAs require that each of the mountains be developed, operated and maintained in accordance with its respective master plan, which contains requirements as to matters such as trail design and development, passenger lift development and environmental concerns.

The MDAs grant a general license to use the Whistler Mountain lands and the Blackcomb Mountain lands for the operation and development of the Whistler Blackcomb.

The MDAs grant a general license to use the Whistler Mountain lands and the Blackcomb Mountain lands for the operation and development of Whistler Blackcomb.

The MDAs also provide for the granting of specific tenures of land owned by the Province to the Whistler LP or the Blackcomb LP, as applicable, by way of rights-of-way, leases or licenses.

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The lease and license provide for the payment of a minimum annual base rent with periodic increases in base rent over the term, turnover rent payments based on a percentage of certain gross revenue, remittance of park user fees and certain other charges, also subject to periodic increases over the term.

Falls Creek and Hotham:

Falls Creek and Hotham are located in the Alpine National Park in Victoria, Australia.

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The ARM Act also established each of the Falls Creek Resort Management Board and Hotham Resort Management Board (the “RMBs”), each of which is appointed by, and responsible to, the Minister for Energy, Environment and Climate Change (the “Minister”).

The RMBs are responsible for the management and collection of fees for entrance into the Alpine National Park and

from Falls Creek and Hotham ski resorts.

The RMBs are responsible for the management and collection of fees for entrance into the Alpine National Park and from Falls Creek and Hotham ski resorts.

The ARM Act authorizes the RMBs to grant leases subject to Ministerial approval, and under this power, the entities operating the Hotham and Falls Creek resorts have each been leased land within the Alpine National Park under various long-term leases with differing expiration dates.

The main lease for the ski field at Falls Creek expires December 31, 2040, while the main lease for the ski field at Hotham expires December 31, 2057.

The main lease for the ski field at Falls Creek expires December

31, 2040, while the main lease for the ski field at Hotham expires December 31, 2057.

The key ski field leases provide for the payment of rent with both a fixed and variable component, a community service charge payable to the ARCC and a ski patrol contribution payable to RMBs.

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The Alpine Resorts (Management) Regulations 2009 (Vic) gives the RMBs the power to declare the snow season, temporarily close the resort to entry if there is a significant danger to public safety, determine parts of a resort to which entry is prohibited, set aside areas of the resort for public use, parking, driving of vehicles, or landing of aircraft, and determine the areas for cross country ski trails, skiing, snowboarding and other snow play activities.

We also own and operate the Hotham Airport.

The regulation of aviation safety in Australia is governed by the Civil Aviation Act 1988 (Cth) (the “CAA”), and regulations and standards made pursuant to the CAA, including the Civil Aviation Regulations 1988 (Cth) and Civil Aviation Safety Regulations 1998 (Cth).

Concessionaire Agreements

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The NPS may suspend operations under the concession contract at any time if the NPS determines it is necessary to protect visitors or resources within the Grand Teton National Park or during a Federal Government shutdown.

NPS may also terminate the concession contract for breach, following notice and a 15 day cure period or if it believes termination is necessary to protect visitors or resources within the Grand Teton National Park.

Environmental Regulations

National Environmental Policy Act;

California Environmental Quality Act

NEPA requires an assessment of the environmental impacts of “significant” proposed actions on National Forest land, such as expansion of a ski area, installation of new lifts or snowmaking facilities or construction of new trails or buildings.

We must comply with NEPA when seeking Forest Service approval of such improvements, except in limited cases where projects are not expected to have environmental impacts, which can be submitted to a Categorical Exclusion.

The Forest Service is responsible for preparing and compiling the required environmental studies, usually through third-party consultants.

NEPA allows for different types of environmental studies, depending on, among other factors, the scope and size of the expected impact of the proposed project.

An Environmental Assessment (“EA”) is typically used for projects where the environmental impacts are expected to be limited.

For projects with more significant expected impacts, an Environmental Impact Statement (“EIS”) is more commonly required.

An EIS is more detailed and broader in scope than an EA.

During the requisite environmental study, the Forest Service is required to analyze alternatives to the proposed action (including not taking the proposed action), as well as impacts that may be unavoidable.

Following completion of the requisite environmental study, the Forest Service may decide not to approve the proposed action or may decide to approve an alternative.

In either case, we may be forced to abandon or alter our development or expansion plans.

Proposed actions at Kirkwood, Northstar and certain portions of Heavenly may also be subject to the California Environmental Quality Act (“CEQA”), which is similar to NEPA in that it requires the California governmental entity approving any proposed action at Kirkwood, Northstar, or on the California portion of Heavenly to study potential environmental impacts.

Projects with significant expected impacts require an Environmental Impact Report while more limited projects may be approved based on a Mitigated Negative Declaration.

Forest & Range Practices Act and Watershed Sustainability Act

The Forest & Range Practices Act (“FRPA”) is the principal legislation that governs mountain resorts in British Columbia, including Whistler Blackcomb.

The FRPA outlines how all forest and range practices and resource-based activities are to be conducted on Crown (Public) land in British Columbia, while ensuring protection of everything in and on the lands, such as plants, animals and ecosystems.

All forest and range licensees’ activities are governed by FRPA and its regulations during all stages of planning, road building, logging, and reforestation, including removing timber for ski trail development.

The FRPA is mostly based on self-compliance and does not specifically express standards for ski area development.

Whistler Blackcomb is also subject to the Watershed Sustainability Act (“WSA”), which is the principal law for managing the diversion and use of water resources in British Columbia and is applicable to Whistler Blackcomb’s use of water for drinking consumption and snowmaking.

The WSA requires Whistler Blackcomb to obtain certain approvals and conduct monitoring of its streams.

Vermont Land Use and Development Act

Specifically, in Vermont, the operations of Stowe and Okemo are subject to Vermont’s state-wide Land Use and Development Act known as “Act 250.” Act 250, administered by the Vermont Agency of Natural Resources, regulates the impacts of development to, among other things, waterways, air, wildlife and earth resources using ten criteria that are designed to safeguard the environment, community life and aesthetic character of Vermont.

Stowe and Okemo each have a Master Plan detailing the development considerations within the resort boundary.

All projects within each resort’s Master Plan have completed or will need to complete the Act 250 review process at the project level.

Environmental Planning and Assessment Act 1979 (NSW, Australia)

The Environmental Planning and Assessment Act 1979 (NSW) (“EPA Act”) is the principal legislation regulating land use and development in New South Wales, Australia.

Perisher relies on a suite of planning approvals (and existing use rights) granted under the EPA Act to operate the resort.

Various types of development that facilitate commercial ski resort operations are also permitted to be carried out without planning approval pursuant to the State Environmental Planning Policy (Kosciusko National Park - Alpine Resorts) 2007 and the Snowy River Local Environmental Plan 2013.

Strategic planning documents have been adopted to provide a framework for the assessment and approval of future development at the resort, including the Perisher Range Resorts Master Plan, Perisher Blue Ski Resort Ski Slope Master Plan and Kosciuszko National Park Plan of Management.

Perisher holds a number of environmental approvals to regulate its operations, including an environment protection license for the sewage treatment plant at Bullock’s Flat and a suite of licenses for the storage of diesel, heating oil and propane in storage tanks across the resort.

Perisher implemented an Environmental Management System to manage compliance with the environmental regulatory framework, and mitigate potential environmental risks arising from its operations.

Environment Protection Act 1970 and the Environment Protection and Biodiversity Conservation Act 1999 (Victoria, Australia)

Falls Creek and Hotham are subject to the Environment Protection Act 1970 (Vic) (“EP Act”) and the Environment Protection and Biodiversity Conservation Act 1999 (Cth) (“EPBC Act”).

The EP Act sets out a system of requirements for approvals and licenses for certain premises where activities may have an effect on the environment.

It also contains policies relating to pollution.

Approval is required under the EPBC Act if an action is likely to have a significant impact on a matter of national environmental significance.

State, Local and Other Regulations

Water and Snowmaking

We rely on a supply of water for operation of our ski areas for domestic and snowmaking purposes and for real estate development.

Availability of water depends on existence of adequate water rights, as well as physical delivery of the water when and where it is needed.

To provide a level of predictability in dates of operation and favorable snow surface conditions at our ski areas, we rely on snowmaking, which requires a significant volume of water, most of which is viewed as a non-consumptive use.

Approximately 80% of the water is returned to the watershed at spring runoff.

Examples of our water sources include:

In Colorado, we own or have ownership interests in water rights in reservoir companies, reservoirs, surface streams, groundwater wells and other sources.

Park City receives water for snowmaking from the Park City Municipal Corporation and Summit Water Distribution Company pursuant to various long-term agreements.

Whistler Blackcomb receives water rights used for snowmaking through licenses from the Province which describe annual allowable volumes on a number of its mountain creeks, and Whistler Blackcomb typically uses only a small percentage of its licensed water.

Heavenly’s primary sources of water purchased for domestic and snowmaking uses are the South Tahoe Public Utility District and Kingsbury General Improvement District, which are California and Nevada utilities, respectively.

Northstar obtains water through a cooperative arrangement with the Northstar Community Services District (“NCSD”).

Together with the NCSD, we, through our lease with affiliates of EPR Properties, control surface water rights that we use for snowmaking.

Kirkwood co-owns with the Forest Service surface water rights sufficient for current and planned snowmaking at the resort.

Kirkwood’s water is stored in nearby Caples Lake under contract with its owner/operator.

Afton Alps, Mt.

Brighton and Wilmot rely on on-site water wells and reservoirs for snowmaking.

Perisher is subject to the Water Act of 1912 (NSW) (“NSW Water Act”), which regulates the use of water sources (such as rivers, lakes and groundwater aquifers) in the Kosciuszko National Park.

Perisher relies on six water licenses issued under the NSW Water Act and a water extraction agreement with an independent third party for the purposes of extracting water for snowmaking.

Falls Creek and Hotham are subject to the Water Act 1989 (Vic) (the “Vic Water Act”), which regulates the use of water resources and entitlements in Victoria.

Falls Creek and Hotham each relies on a water diversion license issued under the Vic Water Act, which authorizes them to take and use water from a specified waterway to operate works and for snowmaking purposes.

The NPS may also terminate the concession contract for breach, following notice and a 15 day cure period or if it believes termination is necessary to protect visitors or resources within the Grand Teton National Park.

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Item 1. Business