UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ýANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
☒ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended July 31, 2018

2021
or
¨TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to 
Commission File Number: 001-09614
mtn-20210731_g1.jpg
Vail Resorts, Inc.
(Exact name of registrant as specified in its charter)
 
Delaware51-0291762
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
390 Interlocken Crescent
Broomfield, Colorado
80021
Broomfield,Colorado80021
(Address of principal executive offices)(Zip Code)
(303)404-1800
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common Stock, $0.01 par valueMTNNew York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:
None
None
(Title of class)
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  x☒  Yes  ¨☐  No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.  ¨☐  Yes  x☒ No




Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.
x☒  Yes  ¨☐  No


Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
x☒  Yes  ¨  No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. x
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerx☒Accelerated filer¨☐
Non-accelerated filer¨☐Smaller reporting company¨☐
Emerging growth company
¨

☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
¨☐  Yes  x☒  No
The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant, based on the closing price of $218.56$265.96 per share as reported on the New York Stock Exchange Composite Tape on January 31, 201829, 2021 (the last business day of the registrant’s most recently completed second fiscal quarter) was $8,752,330,929.$10,590,723,478.
As of September 24, 2018, 40,475,51120, 2021, 40,391,129 shares of the registrant’s common stock were outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant’s definitive Proxy Statement for its 20182021 Annual Meeting of Stockholders to be filed with the Securities and Exchange Commission within 120 days of July 31, 20182021 are incorporated by reference herein into Part III, Items 10 through 14, of this Annual Report.








Table of Contents
PART I
Item 1.
4
Item 1A.
1820
Item 1B.
2833
Item 2.
2833
Item 3.
3136
Item 4.
3136
PART II
Item 5.
3237
Item 6.
3338
Item 7.
3641
Item 7A.
5864
Item 8.
5966
Item 9.
95111
Item 9A.
95111
Item 9B.
96112
PART III
Item 10.
96112
Item 11.
96112
Item 12.
96112
Item 13.
96112
Item 14.
96113
PART IV
Item 15.
96113
Item 16.
99116


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FORWARD-LOOKING STATEMENTS

Except for any historical information contained herein, the matters discussed or incorporated by reference in this Annual Report on Form 10-K (this “Form 10-K”) contain certain forward-looking statements within the meaning of the federal securities laws. These statements relate to analyses and other information, available as of the date hereof which are based on forecasts of future results and estimates of amounts not yet determinable. These statements also relate to our contemplated future prospects, developments and business strategies.


These forward-looking statements are identified by their use of terms and phrases such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “will” and similar terms and phrases, including references to assumptions. Although we believe that our plans, intentions and expectations reflected in or suggested by such forward-looking statements are reasonable, we cannot assure you that such plans, intentions or expectations will be achieved. Important factors that could cause actual results to differ materially from our forward-looking statements include, but are not limited to:


•the ultimate duration of COVID-19 and its short-term and long-term impacts on consumer behaviors, the economy generally, and our business and results of operations, including the ultimate amount of refunds that we would be required to refund to our pass product holders for qualifying circumstances under our Epic Coverage program;
•the willingness of our guests to travel due to terrorism, the uncertainty of military conflicts or outbreaks of contagious diseases (such as the ongoing COVID-19 pandemic), and the cost and availability of travel options and changing consumer preferences or willingness to travel;
•prolonged weakness in general economic conditions, including adverse effects on the overall travel and leisure related industries;
•unfavorable weather conditions or the impact of natural disasters;
•risks related to interruptions or disruptions of our information technology systems, data security or cyberattacks;
•risks related to our reliance on information technology, including our failure to maintain the integrity of our customer or employee data;data and our ability to adapt to technological developments or industry trends;
risks related to cyber-attacks;
willingness of our guests to travel due to terrorism, the uncertainty of military conflicts or outbreaks of contagious diseases, and the cost and availability of travel options and changing consumer preferences;
•the seasonality of our business combined with adverse events that may occur during our peak operating periods;
•competition in our mountain and lodging businesses;businesses or with other recreational and leisure activities;
•the high fixed cost structure of our business;
•our ability to fund resort capital expenditures;
•risks related to a disruption in our water supply that would impact our snowmaking capabilities and operations;
•our reliance on government permits or approvals for our use of public land or to make operational and capital improvements;
•risks related to federal, state, local and foreign government laws, rules and regulations;
•risks related to changes in security and privacy laws and regulations which could increase our operating costs and adversely affect our ability to market our products, properties and services effectively;
•risks related to our workforce, including increased labor costs, loss of key personnel and our ability to hire and retain a sufficient seasonal workforce;
risks related to our workforce, including increased labor costs;
loss of key personnel;
adverse consequences of current or future legal claims;
•a deterioration in the quality or reputation of our brands, including our ability to protect our intellectual property and the risk of accidents at our mountain resorts;
•our ability to successfully integrate acquired businesses, or that acquired businesses may fail to perform in accordance with expectations, including Okemo, Crested Butte, Stevens Pass, Mt. Sunapee or future acquisitions;expectations;
our ability to satisfy the requirements of Section 404 of the Sarbanes-Oxley Act of 2002 with respect to acquired businesses;
•risks associated with international operations;
•fluctuations in foreign currency exchange rates where the Company has foreign currency exposure, primarily the Canadian and Australian dollars;dollars, as compared to the U.S. dollar;
•changes in tax laws, regulations or interpretations, or adverse determinations by taxing authorities;
•risks related to our indebtedness and our ability to satisfy our debt service requirements under our outstanding debt including our unsecured senior notes, which could reduce our ability to use our cash flow to fund our operations, capital expenditures, future business opportunities and other purposes;
•a materially adverse change in our financial condition;
•adverse consequences of current or future legal claims;
•changes in accounting judgments and estimates, accounting principles, policies or guidelines or adverse determinations by taxing authorities;guidelines; and
risks associated with uncertainty of the impact of recently enacted tax reform legislation in the United States;
a materially adverse change in our financial condition; and
•other risks and uncertainties included under Part I, Item 1A,”Risk1A. “Risk Factors” in this document.

All forward-looking statements attributable to us or any persons acting on our behalf are expressly qualified in their entirety by these cautionary statements.

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If one or more of these risks or uncertainties materialize, or if underlying assumptions prove incorrect, our actual results may vary materially from those expected, estimated or projected. Given these uncertainties, users of the information included or incorporated by reference in this Form 10-K, including investors and prospective investors, are cautioned not to place undue reliance on such forward-looking statements. Actual results may differ materially from those suggested by the forward-looking statements that we

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make for a number of reasons including those described above and in Part I, Item 1A,1A. “Risk Factors” of this Form 10-K. All forward-looking statements are made only as of the date hereof. Except as may be required by law, we do not intend to update these forward-looking statements, even if new information, future events or other circumstances have made them incorrect or misleading.

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PART I

ITEM 1.BUSINESS
ITEM 1. BUSINESS
General
Vail Resorts, Inc., together with its subsidiaries, is referred to throughout this document as “we,” “us,” “our” or the “Company.”

Vail Resorts, Inc., a Delaware corporation, was organized as a holding company in 1997 and operates through various subsidiaries. Our operations are grouped into three business segments: Mountain, Lodging and Real Estate, which represented approximately 85.6%89%, 14.2%11% and 0.2%0%, respectively, of our net revenue for our fiscal year ended July 31, 20182021 (“Fiscal 2018”2021”).

As of July 31, 2018,2021, our Mountain segment operates eleventhirty-seven world-class destination mountain resort propertiesresorts and three urbanregional ski areas as well as(collectively, our “Resorts”). Additionally, the Mountain segment includes ancillary services, primarily including:
including ski school,
dining and
retail/rental operations.


On August 15, 2018, we closed on our acquisition of Stevens Pass Resort inIn the State of Washington, and on September 27, 2018, we closed on our acquisition of Triple Peaks, LLC (“Triple Peaks”), the parent company of Okemo Mountain Resort in Vermont, Crested Butte Mountain Resort in Colorado, and Mount Sunapee Resort in New Hampshire. The operations of these four resorts will be reported in our Mountain segment. These four resorts are discussed in additional detail below as well as in Item 7, Management’s Discussion and Analysis.

Our Lodging segment, includes the following:
ownedwe own and/or managedmanage a collection of luxury hotels and condominiums under our RockResorts brand, as well asbrand; other strategic lodging properties
owned and/or managed and a large number of condominiums located in proximity to our North American mountain resorts,
certainresorts; National Park Service (“NPS”) concessionaire properties including the Grand Teton Lodge Company (“GTLC”), which operates destination resorts atin Grand Teton National Park,
Park; a Colorado resort ground transportation company and
Mountain mountain resort golf courses.


Collectively,We refer to “Resort” as the combination of the Mountain and Lodging segments are considered the Resort segment.segments. Our Real Estate segment owns, develops and sells real estate in and around our resort communities.

For financial information and other information about the Company’s segments and geographic areas, see Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Item 8. “Financial Statements and Supplementary Data” below.Data.”

COVID-19 Impact
The ongoing impacts of COVID-19 resulted in reduced visitation and decreased spending for the 2020/2021 North American ski season compared to the prior year through March 14, 2021, the date that we closed our Resorts early for the 2019/2020 North American ski season due to the outbreak of COVID-19. These declines were primarily driven by reduced demand for out-of-state and international (“Destination”) visitation at our western resorts and COVID-19 related capacity limitations. However, Destination visitation improved as the season progressed. Whistler Blackcomb’s performance was negatively impacted due to the continued closure of the Canadian border to international guests, including guests from the U.S., and was further impacted by the resort closing earlier than expected on March 30, 2021 following a provincial health order issued by the government of British Columbia. 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. Our Australian ski areas were also impacted by “stay at home” orders and periodic resort closures during their 2021 ski seasons. The COVID-19 pandemic had a significant adverse impact on our results of operations for Fiscal 2021, and may continue to have a material, negative impact on our resorts for the fiscal year ending July 31, 2022 (“Fiscal 2022”).

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Mountain Segment
Our portfolio of world-classIn the Mountain segment, the Company operates the following 37 destination mountain resorts and urbanregional ski areas, includes:including five resorts within the top ten most visited resorts in the United States for the 2020/2021 North American ski season:
vrimap2018a01.jpgmtn-20210731_g2.jpg
*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 was acquired subsequentprovide a comprehensive resort experience to Fiscal 2018a diverse clientele with an attractive demographic profile. We offer a broad complement of winter and is therefore not includedsummer 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 the consolidated financial results of the Company as of or for the year ended July 31, 2018.close proximity to population centers totaling over 100 million people.
United StatesDestination Mountain Resorts
ColoradoRocky Mountains (Colorado and Utah Resorts (Rocky Mountain Region)Resorts)
•Breckenridge Ski Resort (“Breckenridge”) - the most visited mountain resort in the United States (“U.S.”) for the 2017/20182020/2021 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 2017/20182020/2021 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.

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•Park City Resort (“Park City”) - the third most visited mountain resort in the U.S. for the 2017/20182020/2021 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 fourth most visited mountain resort in the U.S. for the 2017/20182020/2021 ski season and home to the highly renowned A51 Terrain Park, as well as the largest area of night skiing in Colorado. Keystone also offers guests a unique skiing opportunity through guided snow cat ski tours accessing five bowls. 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 ninthtenth most visited mountain resort in the U.S. for the 2017/20182020/2021 ski season. Beaver Creek is a European-style resort with multiple villages and also includes a world renowned children’s ski school program focused on providing a first-class experience with unique amenities such as a dedicated children’s gondola.

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•Crested Butte Mountain Resort (“Crested Butte”) -  acquired in September 2018, Crested Butte is located in southwest Colorado and includes over 1,500 skiable acres and over 3,000 feet of vertical drop. Crested Butte is known for its historic town, iconic mountain peaks and legendary skiing and riding terrain.

Lake Tahoe Resorts
Heavenly Mountain Resort (“Heavenly”) - the tenth most visited mountain resort in the U.S. for the 2017/2018 ski season. Heavenly is located near the South Shore of Lake Tahoe with over 4,800 skiable acres, straddling the border of California and Nevada and offers unique and spectacular views of Lake Tahoe. 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’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(British Columbia, Canada)
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.

Lake Tahoe Resorts

•Heavenly Mountain Resort (“Heavenly”) - located near the South Shore of Lake Tahoe with over 4,800 skiable acres, Heavenly straddles the border of California and Nevada and offers unique and spectacular views of Lake Tahoe. Heavenly offers great nightlife, including its proximity to several casinos.
•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.
Regional Ski Areas
Our ski resort network allows us to connect guests with drive-to access and destination resort access on a single pass product. Building a presence near major metropolitan areas with large populations enables us to drive advance commitment pass product sales among a broad array of guests.
Northeast
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.
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Midwest
Perisher SkiWe 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 (“Perisher”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 terrain for all levels across 1,125 acres of skiable terrain.
Australia
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 typically 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, Australia. Perisher provides accessibility, significant lodgingis the largest ski resort in Australia and targets guests in the Sydney metropolitan area and the market’s most skiable acreage forbroader New South Wales market, while Falls Creek and Mount Hotham are two of the country’s largest cities, including Sydney,ski areas in Victoria and target guests in the Melbourne Adelaide, Canberrametropolitan area 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.

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.

Our Mountain segment derives revenue through the sale of lift tickets, including season passes, 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.

broader Victoria market.
Ski Industry/Competition
There are approximately 770745 ski areas in North America andwith approximately 470460 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 2017/20182020/2021 North American ski season, combined skier visits for all ski areas in North America were approximately 72.774.5 million, which was lower than historical levels due to the ongoing impacts of COVID-19, particularly with regard to Destination visitation. During the 2018/2019 North American ski season (the ski season immediately prior to the outbreak of COVID-19), 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, 2018,Resorts had approximately 11.513.9 million skier visits during the 2017/20182020/2021 ski season, representing approximately 15.8%18.7% of North American skier visits.

Our Rocky Mountain region mountain resorts appeal to both day skiers and destination guests due to our Colorado resorts’ proximity to Colorado’s Front Range (Denver, Colorado Springs and Boulder) metropolitan areas and Park City’s proximity to the Salt Lake City metropolitan area. The Colorado Front Range has a population of approximately 4.8 million and is within approximately 100 miles from each of our Colorado resorts along the I-70 corridor, a major interstate highway. Additionally, the Salt Lake City metropolitan area has a population of approximately 1.2 million and is approximately 30 miles from Park City. These resorts are also accessible from several airports, including Denver International Airport and Eagle County Airport in Colorado and the Salt Lake City International Airport in Utah and have a wide range of amenities available at each resort, as well as within the proximate base areas, villages and towns.

Lake Tahoe, which straddles the border of California and Nevada, is a major skiing destination less than 100 miles from Sacramento and Reno and approximately 200 miles from San Francisco, drawing skiers from the entirety of California and Nevada and making it a convenient destination for both day skiers and destination guests.

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. As such, there have been virtually no new destination ski resorts in North America for over 3540 years, which has allowed and should continue to allow the best-positioned destination resorts to benefit from future industry growth. Our resorts compete with other major destination mountain resorts, including, among others, Aspen Snowmass, Copper Mountain, Mammoth, Deer Valley, Snowbird, Squaw Valley USA, Killington, Sierra at Tahoe, Steamboat, Jackson Hole and Winter Park, as well as other ski areas in Colorado, California, Nevada, Utah, the Pacific Northwest, the Northeast, Southwest and British Columbia, Canada, and other destination ski areas in North America and worldwide as well as non-ski related vacation options and destinations. Additionally, our season 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 2017/2018 (the “Kottke Survey”) andSurveys 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 haveown and operate some of the most iconic, branded destination mountain resorts in geographically diverse and important ski destinations in Colorado, Utah, Lake Tahoe the Northeast 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 salesdata-driven marketing analytics and personalized marketing capabilities, we target increased penetration of season passes, we provideski pass products, providing our guests with a strong value proposition in return

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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. 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 season pass products. MostMany of our destination mountain resorts located in the U.S. typically rank in the most visited ski
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resorts in the U.S. (six(five of the top ten for the 2017/20182020/2021 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 mountain resorts’ ability to provide a high-quality experience.

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

Exceptional Mountain Experience

•World-Class Mountain Resorts and Integrated Base Resort Areas
Our mountain resorts offer a multitude of skiing and snowboarding experiences for the beginner, intermediate, advanced and expert levels. Each mountain resort is fully integrated into expansive resort base areas offering a broad array of lodging, dining, retail, nightlife and other amenities, some of which we own or manage, to our guests.


•Snow Conditions
Our resortsResorts in the Rocky Mountain region of Colorado and Utah, the Sierra Nevada Mountains in Lake Tahoe and the Coast Mountains in British Columbia, Canada receive average annual snowfall between 20 and 39 feet. Average annual snowfall in Australia is significantly lower than at North American ski resorts. However, Perisher generally receives higher average annual snowfall compared to other Australian alpine ski resorts, which is due to its location in the Australian Alps and the elevation of its terrain. 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. 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.


•Lift Service
We systematically upgrade our lifts and put in new lifts to increase uphill capacity and streamline skier traffic to maximize the guest experience. Discretionary expenditures expected for calendar year 2021 include, among other projects, several investments which were previously deferred from calendar year 2020 as a result of COVID-19, including:
•the 250-acre lift-served terrain expansion in the McCoy Park area of Beaver Creek;
•a new four-person high speed lift to serve Peak 7 at Breckenridge;
•replacing the four-person Peru lift at Keystone with a six-person high speed chairlift;
•replacing the Peachtree lift at Crested Butte with a new three-person fixed-grip lift; and
•an upgrade of the four-person Quantum lift at Okemo with a six-person high speed chairlift, relocating the existing four-person Quantum lift to replace the Green Ridge three-person fixed-grip chairlift.
In the past several years, we have installed or upgraded several high speed chairlifts and gondolas across our mountain resorts, including new high speed, six-passenger chairlift replacements for each ofincluding:
•upgrading the NorthwoodsDaisy and Brooks fixed-grip lifts at Stevens Pass to four-person high-speed lifts;
•upgrading the Teocalli fixed-grip lift at Vail Mountain, the Peak 10 Falcon SuperChair at Breckenridge and the MontezumaCrested Butte to a four-person high-speed lift;
•installing a new four-person lift at Keystone;Park City, Over and Out;
•replacing the Leichardt T-bar lift at Perisher with 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; several chairlifts at Wilmot and an eight-passenger gondola connecting Park City and Canyons. For the 2018/2019 ski season, upgrades to various chairlifts include, among other projects,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 chairliftlift to a high speed six-person chairliftlift on Whistler Mountain;
•upgrading the three-person fixed grip Catskinner chairliftlift to a four-person high speed lift at Blackcomb Mountain;
•upgrading the fixed gripfixed-grip High Meadow chairlift to a four personfour-person high speed lift at the Canyons area of Park City; and
•replacing the Galaxy two-person chairliftlift with a three-person chairliftlift at Heavenly and upgrading the Leichhardt T-bar to a four-person chairlift at Perisher.Heavenly.


•Terrain Parks
Our mountain resorts and urban ski areasWe are committed to leading the industry in terrain park design, education and events for the growing segment of freestyle skiers and snowboarders. Each of our destination mountain resorts has multiple terrain parks that include
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progressively-challenging features. These park structures, coupled with freestyle ski school programs, promote systematic learning from basic to professional skills.


Extraordinary Service and Amenities

•Commitment to the Guest Experience
Our focus is to provide quality service at every leveltouch point of the guest experience.journey. Prior to arrival at our mountain resorts, guests can receive personal assistance through our full-service, in-house travel centercentral reservations group and through our comprehensive websites to book desired lodging accommodations, lift tickets and pass products, ski school lessons, equipment rentals, activities and travel arrangements.other resort services. Upon arrival, our resort staff serve as ambassadors to engage guests, answer questions and create a customer-focused environment. In addition, weWe offer guests what we believe is the industry-leading EpicMix, application. EpicMix is 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) and; allows a guest to share his or her experience, photos and

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accomplishments with family and friends on social networks. Since the initial launch of our EpicMix technology, we have expanded EpicMix to include additional offerings such as EpicMix Time, whichnetworks; allows guests to access real time lift line wait times; EpicMix Academy, whichand allows our ski school instructors to certify the attainment of certain skills and ski levels; EpicMix Photo, which provides professional photos and allows guests to share photos on social networks; and EpicMix Guide, which uses guest input to provide a customized, step-by-step navigational guide to experience our mountains. Additionally, we introducedlevels. 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. We then utilize this guest feedback to help us focus our capital spending and operational efforts to the areas of the greatest need.


•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 areasResorts that are marketed towards both out-of-state and international (“Destination”)Destination guests andas well as in-state and local (“Local”) guests. Our seasonThese pass products are available for purchase predominately during the period prior to the start of the ski season, offering our guests a better value in exchange for their commitment to ski at our resortsResorts before the season begins. As such,For the 2020/2021 North American ski season, we reduced the prices of our seasonentire portfolio of pass products by 20%. Our pass program drives strong customer loyalty and mitigates exposure to more weather sensitive guests, leading to greater revenue stability and allowing us to capture valuable guest data. Additionally, our season pass product customers typically ski more days each season than those guests who do not buy season passes,pass products, which leads to additional ancillary spending. SeasonIn addition, our pass products attract new guests to our Resorts. Our pass products generated approximately 47%61% of our total lift revenue for Fiscal 2018. In addition, our season2021, which includes the impact of approximately $120.9 million of pass products attract new guestsproduct revenue which was deferred from Fiscal 2020 and recognized primarily in Fiscal 2021 as a result of pass credits that we offered to our mountain resorts and urban2019/2020 pass holders who renewed for the 2020/2021 ski areas.season. Sales of season 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.Resorts. Our season pass products range from providing access for a certain number of days to one or a combination of our mountain resorts and urban ski areasResorts to our Epic Pass, which provides unrestricted and unlimited access to all of our mountain resortsResorts. The Epic Day Pass is a customizable one to seven day pass product purchased in advance of the season, for those skiers and urbanriders who expect to ski areas.a certain number of days during the season, and which is available in two tiers of resort offerings. All of our various season pass product options can be found on our consumer website www.snow.com. Information on our websites does not constitute part of this document.


As part of our continued strategy to drive season 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. Whistler Blackcomb,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 October 2016, is a world-renowned international skiing destination which receives more than two million skier visits each year.June 2015. Stevens Pass in Washington State acquired(acquired in August 2018, receives approximately half a million skier visits each year and2018) is located 85 miles from Seattle and 250 miles from Whistler Blackcomb.Blackcomb, a world-renowned international skiing destination which typically receives more than two million skier visits each year. We have also made strategic acquisitions of mountain resorts located in the Northeast U.S. recently, including Okemo in Vermont (acquired in September 2018), and Mount Sunapee in New Hampshire (acquired(both acquired in September 2018) and Stowe in Vermont (acquired in June 2017). These resortsski areas are premier, high-end ski resortsdestinations for skiers and snowboarders on the East Coast, which draw visitors from New York City, Boston and the broader Northeast skier population. In June 2015, we acquired Perisher in Australia, which is also an important international market for ski resorts across the Northern Hemisphere, generating an estimated more than one million skier visits annually to resorts in North America, Japan and Europe. 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. Paul and Mt. 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-partythird-
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party mountain resorts including Telluride Ski Resort and Arapahoe Basin in Colorado, Sun Valley Resort in Idaho, Snowbasin Resort in Utah, Hakuba Valley and Rusutsu Resort in Japan, and 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 season pass products.


For the 2020/2021 North American ski season, we introduced Epic Mountain Rewards, a program which provides pass product holders a discount of 20% off on-mountain food and beverage, lodging, group ski school lessons, equipment rentals and more at our North American owned and operated 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, in April 2020 we introduced Epic Coverage, which is included with the purchase of all pass products for no additional charge. Epic Coverage provides refunds in the event of certain resort closures and certain travel restrictions (e.g. for COVID-19), giving pass holders a refund for any portion of the season that is lost due to qualifying circumstances. Additionally, Epic Coverage provides a refund for qualifying personal circumstances that were historically covered by our legacy pass insurance program, including eligible injuries, job losses and many other personal events.

•Premier Ski Schools
Our mountain resorts are home to some of the highest quality and most widely recognized ski and snowboard schools in the industry. Through a combination of outstanding training and abundant work opportunities, our ski schools have become home to many of the most experienced and credentialed professionals in the business. We complement our instructor staff with state-of-the-art facilities and extensive learning terrain, all with a keen attention to guest needs. We offer a wide variety of adult and child group and private lesson options with a goal of creating lifelong skiers and riders and showcasing to our guests all the terrain our resorts have to offer.



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•Dining
Our resortsResorts 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 operateFor the 2020/2021 ski season, we operated approximately 215260 dining venues at our mountain resortsResorts, which were impacted by restrictions and urban ski areas.limitations as a result of the impacts of COVID-19 and to ensure the safety of our guests and employees, including limited food options at quick-service restaurants, spacing of tables in seating areas to allow for physical distancing, and maintaining as much outdoor seating as possible.


•Retail/Rental
We have approximately 290325 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,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 theour retail/rental locations in the Colorado Front Range and in the San Francisco Bay Areanear key population centers also offer prime venues for selling our season pass products.


•On-Mountain Activities
We are a ski industry leader in providing comprehensive destination vacation experiences, including on-mountain activities designed to appeal to a broad range of interests. InDuring a normal winter season, 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.dining, although some of these activities were restricted or limited for the most recent winter season to ensure the safety of our guests and employees as a result of COVID-19. During thea 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;rides, mountain biking;biking, horseback riding;riding, guided hiking;hiking, 4x4 Jeep tours;tours, and our Epic Discovery program which launched at both Vail Mountain, Heavenly and Heavenly in June 2016Breckenridge, although some of these activities were restricted or limited for both the 2020 and at Breckenridge in June 2017.2021 summer seasons to ensure the safety of our guests and employees as a result of COVID-19. 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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•Lodging and Real Estate
High quality lodging options are an integral part of providing a complete resort experience. Our owned orand 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, ourOur 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. Properties):
Ownedowned and managed lodging properties, including those under our luxury hotel management company, RockResorts;
Managed managed condominium units which are in and around our mountain resorts in Colorado, Lake Tahoe, Utah, Vermont, New York and British Columbia, Canada;
Two two NPS concessionaire properties in and near Grand Teton National Park in Wyoming;
a resort ground transportation company in Colorado; and
Company-owned company-owned and operated mountain resort golf courses, including five in Colorado,Colorado; one in Wyoming and two in Vermont, as well as two Company-operated mountain golf courses;Wyoming; one in Lake Tahoe, CaliforniaCalifornia; and one in Park City, Utah.

For additional property details, see Item 2. “Properties”.
The Lodging segment currently includes approximately 5,4005,500 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 orand 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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Lodging Industry/Market
Hotels are categorized by Smith Travel Research, a leading lodging industry research firm, as luxury, upper upscale, upscale, mid-price and economy. The service quality and level of accommodations of our RockResorts’ hotels place them in the luxury segment, which represents hotels achieving the highest average daily rates (“ADR”) in the industry, and includes such brands as the Four Seasons, Ritz-Carlton and Starwood’sMarriott’s Luxury Collection hotels. Our other hotels are categorized in the upper upscale and upscale segments of the hotel market. The luxury and upper upscale segments consist of approximately 736,000763,000 rooms at approximately 2,2002,400 properties in the U.S. as of July 2018.31, 2021. For Fiscal 2018,2021, our owned hotels, which include a combination of certain RockResort hotels as well as other hotels in proximity to our mountain resorts,Resorts, had an overall ADR of $250.50$264.83, a paid occupancy rate of 69.2%46.2% and revenue per available room (“RevPAR”) of $173.34,$122.45, as compared to the upper upscale segment’s ADR of $184.43,$155.53, a paid occupancy rate of 74.3%37.8% and RevPAR of $137.06.$58.85. 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. The highly seasonal nature of our lodging properties generallytypically results in lower average occupancy as compared to the upper upscale segment of the lodging industry as a whole.

whole, although this was not the case during Fiscal 2021 as a result of the significant impacts of COVID-19 on the broader lodging industry.
Competition
Competition in the hotel industry is generally based on quality and consistency of rooms, restaurants, meeting facilities and services, the attractiveness of locations, availability of a global distribution system and price. Our properties compete within their geographic markets with hotels and resorts that include locally-owned independent hotels, as well as facilities owned or managed by national and international chains, including such brands as Four Seasons, Hilton, Hyatt, Marriott, Ritz-Carlton Starwood’s Luxury Collection and Westin. Our properties also compete for convention and conference business across the national market. We believe we are highly competitive in the resort hotel niche for the following reasons:
All•all of our hotels are located in unique, highly desirable resort destinations;
Our•our hotel portfolio has achieved some of the most prestigious hotel designations in the world, including two properties in our portfolio that are currently rated as AAA 4-Diamond;
Many
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•many of our hotels (both owned and managed) are designed to provide a look that feels indigenous to their surroundings, enhancing the guest’s vacation experience;
Each•each of our RockResorts hotels provides the same high level of quality and services, while still providing unique characteristics which distinguish the resorts from one another. This appeals to travelers looking for consistency in quality and service offerings together with an experience more unique than typically offered by larger luxury hotel chains;
Many•many of the hotels in our portfolio provide a wide array of amenities available to the guest such as access to world-class ski and golf resorts, spa and fitness facilities, water sports and a number of other outdoor activities, as well as highly acclaimed dining options;
Conference•conference space with the latest technology is available at most of our hotels. In addition, guests at Keystone can use our company-owned Keystone Conference Center, the largest conference facility in the Colorado Rocky Mountain region with more than 100,000 square feet of meeting, exhibit and function space;
We•we have a central reservations system that leverages off of our mountain resort reservations system and has an online planning and booking platform, offering our guests a seamless and useful way to make reservations at our resorts; and
We•we actively upgrade the quality of the accommodations and amenities available at our hotels through capital improvements. Capital funding for third-party owned properties is provided by the owners of those properties to maintain standards required by our management contracts. Projects at our owned properties completed over the past several years include extensive refurbishments and upgrades to the Grand Summit Hotel, Colter Bay Village Cabins, and DoubleTree by Hilton Breckenridge. Additionally, we have completed guest room renovations at the Keystone Lodge and The Pines Lodge.

National Park Concessionaire Properties
We own GTLC, which is based in the Jackson Hole area in Wyoming and operates within Grand Teton National Park under a 15-year concessionaire agreement with the NPS with an initial term that expireswould have expired on December 31, 2021. In June 2021, we agreed to an amendment to the agreement extending the term an additional two years, with an expiration date of December 31, 2023. We also own Flagg Ranch, located in Moran, Wyoming and centrally located between Yellowstone National Park and Grand Teton National Park on the John D. Rockefeller, Jr. Memorial Parkway (the “Parkway”). Flagg Ranch operates under a 15-year concessionaire agreement with the NPS that expires October 31, 2026.2028. GTLC also owns Jackson Hole Golf & Tennis Club (“JHG&TC”), located outside Grand Teton National Park near Jackson, Wyoming. GTLC’s operations within Grand Teton National Park and JHG&TC have operating seasons that generally run from June through the end of September.


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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. 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 RVrecreational vehicle park. GTLC offers dining options as extensive as its lodging options, with cafeterias, casual eateries and fine dining establishments. GTLC’s resorts provide a wide range of activities for guests to enjoy, including cruises on Jackson Lake, boat rentals, horseback riding, guided fishing, float trips, golf and guided Grand Teton National Park tours. As a result of the extensive amenities offered, as well as the tremendous popularity of the National Park System, GTLC’s accommodations within Grand Teton National Park operate near full capacity during their operating season.

Real Estate Segment
We have extensive holdings of real property at our mountain resorts primarily throughout Summit and Eagle Counties in Colorado. Our real estate operations, through Vail Resorts Development Company (“VRDC”), a wholly-owned subsidiary, include planning, oversight, infrastructure improvement, development, marketing and sale of our real property holdings. In addition to the cash flow generated from real estate development sales, these development activities benefit our Mountain and Lodging segments by (1) creating additional resort lodging and other resort related facilities and venues (primarily restaurants, spas, commercial space, private mountain clubs, skier services facilities and parking structures) that provide us with the opportunity to create new sources of recurring revenue, enhance the guest experience and expand our destination bed base; (2) controlling the architectural themes of our resorts; and (3) expanding our property management and commercial leasing operations.

The principal activities of our Real Estate segment include the sale of land parcels to third-party developers and planning for future real estate development projects, including zoning and acquisition of applicable permits. We continue undertaking preliminary planning and design work on future projects and are pursuing opportunities with third-party developers rather than
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undertaking our own significant vertical development projects. We believe that, due to the low carrying cost of our real estate land investments, we are well situated to promote future projects with third-party developers while limiting our financial risk.

Marketing and Sales
Our Mountain segment’s marketing and sales efforts are increasingly oriented around datafocused 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 season pass program,products, our e-commerce platforms including mobile lift ticket sales, the EpicMix application and operational processes at our lift ticket windows. We promote our resorts through customer relationshipResorts using guest-centric omni-channel marketing to targeted audiences viacampaigns leveraging email, and direct mail, promotional programs, digital marketing (including social, search and display) and traditional media advertising where appropriate (e.g. targeted print, TV and radio). We also have marketing programs directed at attracting groups, corporate meetings and convention business. Most of our marketing efforts drive traffic to our websites, where we provide our guests with information regarding each of our resorts,Resorts, including services and amenities, reservations information, virtual tours and the opportunity to book/purchase multipleour full suite of products (e.g. lift access, lodging, ski school, rentals, etc.) for their vacations or other visits. We also enter into strategic alliances with companies to enhance the guest in-resort experience andat 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.advertising, all of which are designed to drive traffic to our websites and central reservations call center. 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. In addition, our hotels have active sales forces to drive traffic togenerate conference and group business. We market our websitesresort properties in conjunction with our mountain resort marketing efforts where appropriate, given the strong synergies across the two businesses. 
Across both the Mountain and central reservations call center. SalesLodging segments, sales made through our websites and call center allow us to transact directly with our guests, enabling us towhich further expandexpands our customer base for futureand enables analytics and marketing. Where appropriate, we market our resort properties in conjunction with our mountain resortto deliver an increasingly guest-centric marketing efforts. Additionally, our individual hotels have active sales forces to generate conference and group business.

experience.
Seasonality
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. In an effort to partially mitigate the concentration of our revenue in the winter months in North America, we offer several non-ski related activities in the summer months such as sightseeing, mountain biking, guided hiking, 4x4 Jeep tours, golf (included in the operations of the Lodging segment) and our Epic Discovery program. These activities also help attract destination conference and group business to our resortsResorts in our off-season. In addition, the operating results of Perisher, with itsour Australian Resorts, for which the ski season generally occurs from June through early October, partially counterbalancecounterbalances the concentration of our revenues during this seasonally low period.

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lower period in North America.
Our lodging business is also highly seasonal in nature, with peak seasons primarily in the winter months (with the exception of GTLC, Flagg Ranch, certain managed properties and mountain resort golf operations). 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 tenseveral 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.proximate to our Resorts, as described above.

Environmental Stewardship andSustainability & Social Responsibility
Environmental stewardship isSustainability remains a core philosophy for us. Our resorts operateAs a company rooted in some of the world’s greatest naturalgreat outdoors, we have a unique responsibility to protect and preserve the incredible environments andin which we are compelled to care for and conserve them.operate. Through our corporate sustainability and social responsibility and sustainability program, Epic Promise,EpicPromise, we focus on climate change mitigation, resource conservation, forest health and building stronger local communities through contributions to local non-profit organizations. Our environmental stewardshipsustainability efforts are diverse and touch nearly every area of our operations. In 2017, we launched our Commitment to Zero, aour pledge to have a zero net zero operating footprint by 2030. This commitment includes (i) achieving zero net emissions by finding operational energy efficiencies, and investing in renewable energy and investing in offsets and other emissions reduction projects, (ii) zero waste to landfillslandfill by diverting 100 percent100% of waste from our operations, and (iii) zero net operating impact to forests and wildlife 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 100300 global and influential businesses which are committed to 100 percent100% renewable electricity. During Fiscal 2021, we continued to make progress toward our Commitment to Zero goals, despite operational adjustments made in response to COVID-19. Specifically, we focused on maintaining our robust composting and recycling diversion programs as much as
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possible and started new composting programs at seven resorts. In Colorado and Utah, we drove a pilot project to recycle snack wrappers and worked with strategic partners to create picnic tables, Adirondack chairs and a terrain park feature made from recycled wrappers and bottles for participating resorts. The 82-turbine Plum Creek Wind project we enabled came online in June 2020, and in Fiscal 2021 we purchased approximately 281,000 megawatt hours (MWh) of wind energy, addressing an estimated 85% of the Company’s current electricity use across its 34 North American destination mountain resorts and regional ski areas.
For over two years, Vail Resorts has worked with leaders from other ski companies to develop an industry-driven climate commitment. In June 2021 we, alongside Alterra Mountain Company, Boyne Resorts, and POWDR, announced the Climate Collaborative Charter - the ski industry’s first unified effort to combat climate change. This partnership leverages our leadership in sustainability and is expected to accelerate our collective progress, leading the industry toward long-term transformational change.
In addition, during Fiscal 2021, we have partneredsponsored the reforestation of acreage in the White River National Forest in Colorado that was devastated in a 2017 wildfire, which 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 help raise resources for local environmental programs,fund restoration projects, including The Nature Conservancy, 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 also encourage our employees to help protect the environment and support their local community by volunteering with over 20,000 volunteer hours donated annually. Our charitable giving focusesvarious organizations.
For Fiscal 2021, our focus for the EpicPromise community impact grant program was on supportingCOVID-19 response in our resort communities, including housing assistance, food security, equal access to education and other basic needs and services. In addition, we hosted more than 3,000 youth across our resorts through multi-day programs encouraging innovationfocused on mentorship, leadership and the impact of outdoor time on mental health in and implementation of, environmental stewardship practices and enhancing the quality of life in the communities in which we operate.

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

Human Capital Management
Employees
At Vail Resorts, our Talent Philosophy focuses on fully achieving our mission and vision by ensuring we have the talent in place to deliver on our future growth plans. We are truly passionate about our people, and we are focused on hiring and developing the best talent and building the best teams around them. At fiscal year end, we employed approximately 6,100 year-round employees. DuringOver the heightcourse of our most recentResorts’ various winter and summer operating seasons in Fiscal 2021, we employed approximately 27,200 additional40,200 seasonal employees. In addition, we employed approximately 400100 year-round employees and 100 seasonal employees on behalf of the owners of our managed hotel properties. We consider our employee relations to be good.positive.


Our talent philosophy recognizes that people are our most important asset in driving our business growth, and outlines the role that leaders play in attracting, developing, engaging and rewarding high performing, high potential talent, including supporting them to achieve their future career growth. Our talent management system enables leaders with programs and tools to effectively assess, develop and reward talent and includes regular Leadership Talent Review and Assessment processes to ensure that the caliber and capability of our talent aligns with the sophistication of our business strategies and processes. Our executive team reviews talent strategy and succession planning frequently, including with our Board of Directors, to assess current and future talent needs. We have a strong track record of hiring, developing and preparing high performing, high potential talent for internal mobility and succession and since 2018, we have nearly doubled our percentage of high performing, high potential talent through performance management and talent upgrades. As a result, succession for our senior leadership roles, is primarily sourced through internal talent development and promotion, rather than external hires (72% internal fill rate). Over the past twelve months, we announced internal successors for some of the most senior roles in our Company, including Chief Executive Officer, Chief Marketing Officer, President of the Mountain Division, and Chief Operating Officer of Hospitality and Retail. All of our recent appointments of General Manager and Chief Operating Officers of our Resorts for the past three years came from internal succession.

To ensure we are building high performing teams, we encourage every employee at every level within the Company to continuously grow their leadership by participating in on-going leadership events that build leadership capability and drive aligned leadership expectations to enable business outcomes. We host an annual Leadership Summit that brings together our leaders at manager level and above to build understanding and alignment to business priorities, explore emerging leadership
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topics and build connections across our growing global business and organization. We offer ongoing digital leadership series discussions led by our CEO for this same population throughout the year and equip leaders to share learnings and insights from these sessions in dialogue with their teams for the benefit of the entire organization. Our leadership philosophy has a very strong emphasis on emotional intelligence and a leader’s ability to understand their own impact on others, and shape that impact to unlock the potential of their teams.

We offer a broad range of professionally designed leadership development programs for entry level seasonal employees to the most senior executives, with differentiated development for our highest performing, highest potential employees who make up our long-term leadership succession pipeline. We provide tools and resources for employees of all levels to learn and grow as leaders and reward this as part of our performance management process. The Lift, our learning management system, gives employees access to a library of online learning resources to help them succeed. We also provide access to development tools, like the Insights Discovery platform, a behavioral assessment that offers a framework for self-understanding and development. Finally, to help employees navigate unique challenges presented by COVID-19, we intentionally invested in building new scalable digital programs to provide leaders across the company real-time capability to drive a successful business recovery, including programs focusing on resilience, agility, change leadership, sustainable energy and mental health.

Early on in the COVID crisis, we implemented a continuous listening survey to measure and understand the impact of COVID and our response actions on employees, in order to make timely adjustments to maintain strong alignment and focus, and to care for the needs of our employees through a challenging and uncertain period. As the winter season progressed and we achieved a level of business and organization stability, we broadened our continuous listening survey objectives and approach to focus on the drivers of sustainable engagement.

Vail Resorts Culture
Core to our human capital management strategy is our mission – to create an Experience of a Lifetime for our employees so they can in turn create an Experience of a Lifetime for our guests. We have a values-based leadership culture that places a premium on leader transparency, vulnerability and authenticity. We look for people to join Vail Resorts who are brave, passionate and ambitious. As Vail Resorts employees, we hold ourselves accountable for living these seven foundational values every day in everything we do: Serve Others, Do Right, Do Good, Be Safe, Have Fun, Be Inclusive and Drive Value.

Diversity, Equity and Inclusion
We believe that diversity, equity and inclusion (“DEI”) is core to both our company success and the future growth of our industry. At Vail Resorts, one of our core values is “Be Inclusive”, which means that we expect everyone at our Company to be welcoming to others, including all races, gender identities, sexual orientations, abilities and other differences.

We have a long history of building gender diversity throughout the Company. Women represent 48% of our corporate senior leaders at the director level and above and over 50% of our corporate roles generally. Ten resorts in our portfolio are led by women, including three of our five largest resorts (Vail, Beaver Creek and Breckenridge). As of November 1, 2021, five of our ten directors will be women and two of our nine executive committee members are women, and our Chief Executive Officer, Kirsten Lynch, will be the only woman to head a Fortune 1000 company in travel and leisure. While women currently represent only approximately 20% of mountain operations senior leadership roles, we continue to strive to bring more gender diversity to these roles, which have historically been male-dominated. We have also developed Women in Leadership programs to foster an inclusive culture, and Forbes named us one of America’s Best Employers for Women in both 2019 and 2020.

We are focused on improving racial diversity at Vail Resorts, as well as in our communities and our industry. To that end, we are working towards addressing barriers to attracting the best talent from BIPOC communities in order to fuel innovation and growth within our Company and industry. We are also incorporating more diverse representation in our marketing efforts, including more direct outreach to communities of color. Over this past year, we undertook extensive efforts around DEI, including company-wide virtual webinars bringing forward diverse voices, DEI dialogues with external thought leaders, and online DEI training modules aligned with our “Be Inclusive” value. As part of our commitment to driving sustainable change, we are listening and learning as a company, and the Company is part of CEO Action, Colorado Inclusive Economy and Civic Alliance.

We require our full-time, year-round employees, as well as certain seasonal employees, to complete annual training as part of our Code of Conduct. This annual requirement includes training on a variety of topics, including unconscious bias and anti-harassment. In Fiscal 2021, the training was completed by 98% of this employee base. Our Code of Conduct states that every employee is entitled to work in a respectful environment that is free of harassment, bullying and discrimination.

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Mountain Safety
The nature of our on-mountain operations comes with inherent safety risks, and the health and safety of our employees is a top priority. It is the shared responsibility of every employee to actively participate in creating a safe and secure environment and to minimize injuries. To that end, we routinely:

•Provide resources and education to promote safe operating environments at our resorts, including compliance with Occupational Safety and Health Administration standards, as well as to improve overall workplace safety and health. This includes regular and ongoing safety training and assessments as well as safety audits, and all employees are required to take annual slope safety training.
•Proactively assess risks to identify and mitigate unsafe conditions and integrate learnings from incidents to prevent future occurrences across our network of resorts.
•Hire and train a dedicated health and safety team that oversees resort operations as well as highly trained ski patrol professionals at each resort.

COVID-19 Safety
The safety of our employees, guests and resort communities has been of utmost importance to us amidst the COVID-19 pandemic. The vast majority of our corporate employees worked remotely during COVID-19, and we currently plan to re-open our corporate office in January 2022. Our mountain operations, retail, lodging and other employees need to be onsite to carry out their work, and as part of our commitment to safety for these employees, we took the following actions associated with COVID-19 safety protocols:

▪All employees were required to wear face coverings at all times during the 2020/21 winter season, and we currently require face coverings to be worn by employees and guests in any of our indoor spaces.
▪Employees undergo daily health screenings.
▪Employees receive training to ensure compliance with additional health and safety protocols.
▪Implemented on-site testing for employees.
▪Implemented procedures to address actual and suspected COVID-19 cases and potential exposure.
▪High-touch surfaces are frequently cleaned and disinfected with EPA-approved products for COVID.
▪Enhanced cleaning and disinfecting.
▪Hand sanitizing stations provided throughout resorts.
▪Plexiglass barriers installed in areas where physical distancing measures are more difficult, including points of purchase.
▪Provided mental health support and access.

We continue to monitor guidance from federal and local health authorities in evaluating the need for continued COVID-19 safety protocols with regard to ongoing operations and as we prepare for the 2021/2022 North American ski season.
Intellectual Property
The development of intellectual property is part of our overall business strategy, and we regard our intellectual property as an important element of our success. Accordingly, we protect our intellectual property rights and seek to protect against its unauthorized use through international, national and state laws and common law rights. We file applications for and obtain trademark registrations and have filed for patents to protect inventions and will continue to do so where appropriate. We also seek to maintain our trade secrets and confidential information by nondisclosure policies and through the use of appropriate confidentiality agreements and contractual provisions.

In the highly competitive industry in which we operate, trademarks, service marks, trade names and logos are very important in the sales and marketing of our pass products, destination mountain resorts and urbanregional ski areas, lodging properties and services. We seek to register and protect our trademarks, service marks, trade names and logos and have obtained a significant number of registrations for those trademarks. We believe our brands have become synonymous in the travel and leisure industry with a reputation for excellence in service and authentic hospitality. Among other national and international trademark registrations, the Company owns U.S. federal registrations for Epic®, Epic Pass®, Vail Resorts®, Vail®, Beaver Creek®, Breckenridge®, Keystone®and Heavenly®. The Company also owns Canadian and U.S. trademark registrations for the Whistler Blackcomb®name and logo. The Company licenses
Environmental Compliance and other Laws and Regulations
Our operations are subject to federal, state and local laws and regulations governing the right toenvironment, including laws and regulations governing water and sewer discharges, water use, air emissions, soil and groundwater contamination, the federally registered trademark Northstar California® from CLP Northstar, LLC.

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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).
RegulationVarious federal, state, local and Legislationprovincial 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
U.S. Forest Service Resorts

Federal Regulation

The operations of Breckenridge, Vail Mountain, Keystone, Beaver Creek, Crested Butte, Stevens Pass, Heavenly, Kirkwood, Mount Snow, Attitash and Kirkwoodportions of Beaver Creek and Wildcat are conducted primarily on land under the jurisdiction of the U.S. Forest Service (collectively, the “Forest Service Resorts”). The 1986 Ski Area Permit Act (the “1986 Act”) allows the Forest Service to grant Term Special Use Permits (each, a “SUP”) for the operation of ski areas and construction of related facilities on National Forest lands. In November 2011, the 1986 Act was amended by the Ski Area Recreational Opportunity Enhancement Act (the “Enhancement Act”) to clarify the Forest Service’s authority to approve facilities primarily for year-round recreation. Under the 1986 Act, the Forest Service has the authority to review and approve the location, design and construction of improvements in the permit area and many operational matters.

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:
Forest Service ResortAcresExpiration Date
Breckenridge5,702December 31, 2029
Vail Mountain12,353December 1, 2031
Keystone8,376December 31, 2032
Beaver Creek3,849November 8, 2039
Heavenly7,050May 1, 2042
Mount Snow894April 4, 2047
Attitash279April 4, 2047
Wildcat953November 18, 2050
Kirkwood2,330March 1, 2052
Stevens Pass2,443August 31, 2058
Crested Butte4,350September 27, 2058
Stevens Pass2,443August 15, 2058
Heavenly7,050May 1, 2042
Kirkwood2,330March 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. We are not aware of the Forest Service refusing to issue a new SUP to replace an expiring SUP for a ski resort in operation at the time of expiration. The Forest Service can also terminate a SUP if it determines that termination is required in the public interest. However, to our knowledge, no SUP has ever been terminated by the Forest Service over the opposition of the permit holder.

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Each SUP contains a number of requirements, including indemnifying the Forest Service from third-party claims arising out of our operation under the SUP and compliance with applicable laws, such as those relating to water quality and endangered or threatened species. For use of the land authorized by the SUPs, we pay a fee to the Forest Service ranging from 1.5% to 4.0% of adjusted gross revenue for activities authorized by the SUPs. Included in the calculation are sales from, among other things, lift tickets, season passes,pass products, ski school lessons, food and beverage, certain summer activities, equipment rentals and retail merchandise.

The SUPs may be revised or amended to accommodate changes initiated by us or by the Forest Service to change the permit area or permitted uses. The Forest Service may amend a SUP if it determines that such amendment is in the public interest. While the Forest Service is required to seek the permit holder’s consent to any amendment, an amendment can be finalized over a permit holder’s objection. 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.


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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. The MDPs are reviewed by the Forest Service for compliance with the Forest Plan and other applicable laws and, if found to be compliant, are accepted by the Forest Service. Notwithstanding acceptance by the Forest Service of the conceptual MDPs, individual projects still require separate applications and compliance with NEPA and other applicable laws before the Forest Service will approve such projects. 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 upcomprised of two mountains: Whistler Mountain and Blackcomb Mountain. Whistler Mountain and Blackcomb Mountain are located on Crown Land within the traditional territory of the Squamish and Lil’wat Nations. The relationship between Whistler Blackcomb and Her Majesty, the Queen in Right of British Columbia (the “Province”) is largely governed by Master Development Agreements (the “MDAs”) between the Province and Whistler Mountain Resort Limited Partnership (“Whistler LP”) with respect to Whistler Mountain, and between the Province and Blackcomb Skiing Enterprises Limited Partnership (“Blackcomb LP”) with respect to Blackcomb Mountain. Together, Whistler LP and Blackcomb LP are referred to as the “Partnerships.”

The MDAs, which were entered into in February 2017, have a term of 60 years (expiring on February 23, 2077) and are replaceable for an additional 60 years by option exercisable by the Partnerships after the first 30 years of the initial term. In accordance with the MDAs, the Partnerships are obligated to pay annual fees to the Province at a percentage of gross revenues related to the operation of certain activities at Whistler Blackcomb.

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 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. Each Partnership is permitted to develop new improvements to Whistler Mountain or Blackcomb Mountain, as the case may be, within standard municipal type development control conditions. We are obligated to indemnify the Province from third-party claims arising out of our operations under the MDAs.

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Northeast Resorts

Stowe and Okemo operate partially on land that we own and partially on land we lease from the State of Vermont. With respect to Stowe, the land we own is on the Spruce Peak side of the resort while the land we lease from the State of Vermont is located on Mt. Mansfield in the Mt. Mansfield State Forest. The initial ten year term of the lease commenced in June 1967, and the lease provides for eight separate ten year extension options. The current term of the lease extends through June 2027, and there are three remaining ten year extension options. With respect to Okemo, we own the Jackson Gore base area land and lease most of the skiable terrain from the State of Vermont. The initial ten year term of the lease commenced in December 1963, and the lease provides for eight separate ten year extension options. The current term of the lease extends through December 2023, and there are three remaining ten year extension options. Under both leases, the land can be used for the development and operation of a ski area including ski trails, ski lifts, warming shelters, restaurants and maintenance facilities. For use of the land under the leases, we pay a fee to the State of Vermont based on revenue for activities authorized by the lease, such as lift tickets, season passes,pass products, food and beverage, summer activities and retail merchandise. We are obligated to indemnify the State of Vermont from third-party claims arising out of our operations under the lease.

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Mount Sunapee lies within the Mount Sunapee State Park and operates on land that we lease from the State of New Hampshire. The initial twenty year term of the lease commenced in July 1998, and the lease provides for three separate ten year extension options. The current term of the lease extends through June 2028, and there are two remaining ten year extension options. The land can be managed and operated as a ski area and summer recreational facility, including all of its support activities, to provide year-round outdoor recreation. For use of the land under the lease, we pay a fee to the State of New Hampshire that includes both a base fee and a fee based on revenue from activities authorized by the lease, such as lift tickets, season passes,pass products, food and beverage, summer activities and retail merchandise. We are obligated to indemnify the State of New Hampshire from third-party claims arising out of our operations under the lease.

Perisher

Australian Resorts
Perisher is located in the Kosciuszko National Park, the largest national park in New South Wales, Australia. The resort includes four villages (Perisher Valley, Smiggin Holes, Guthega and Blue Cow) and their associated ski fields, as well as the site of the Skitube Alpine Railway at Bullock’s Flat, which is accredited in accordance with the Rail Safety National Law (NSW) No. 82a. The Office of Environment and Heritage (“OEH”), an agency of the New South Wales government, which is part of the Department of Planning and Environment, is responsible for the protection and conservation of the Kosciuszko National Park. The National Parks and Wildlife Act 1974 (NSW) (“NPW Act”) establishes the National Parks and Wildlife Service and is responsible for the control and management of the Kosciusko National Park.
The NPW Act requires the Kosciuszko National Park to be managed in accordance with the principles specified in that legislation, including the provision for sustainable visitor or tourist use and enjoyment that is compatible with the conservation of the national park’s natural and cultural values. The legislation also authorizes the Minister for the Environment and the Minister for Heritage (the “Minister”) to grant leases and licenses of land within the Kosciuszko National Park for various purposes, including for purposes related to sustainable visitor or tourist use and enjoyment. Under this power, the Minister has granted to Perisher a lease and a license of specified land within the Kosciusko National Park until June 30, 2048, with an option to renew for an additional period of 20 years. The Minister has also granted Perisher a lease of the parking lot at Perisher Valley that expires on December 31, 2025. Subject to certain conditions being met, the lease for the Perisher Valley parking lot can be extended until June 30, 2048, with an option to renew for a further 20 years. 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 are located in the Alpine National Park in Victoria, Australia. Falls Creek and Hotham both operate on Crown land permanently reserved under the Crown Land (Reserves) Act 1978 (Vic), with the exception of three small parcels of freehold land within the Hotham resort area. Each resort is subject to the Alpine Resorts (Management) Act 1997 (Vic) (the “ARM Act”), which is in place to manage the development, promotion, management and use of the resorts on a sustainable basis and in a manner that is compatible with the alpine environment. The ARM Act established the Alpine Resorts Commission to plan for the direction and sustainable growth of Victoria’s five alpine resorts (including Falls Creek and Hotham). This includes review and coordination of the implementation of an Alpine Resorts Strategic Plan to which Falls Creek and Hotham are subject.
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 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 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. At Hotham, we also lease land known as ‘Dinner Plain’ within the Alpine National Park which expires on June 30, 2031, with an option to extend for a further 10 years.
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.
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Concessionaire Agreements

GTLC operates three lodging properties, food and beverage services, retail, camping and other services within the Grand Teton National Park under a concessionaire agreement with the NPS. Our concessionaire agreement with the NPS for GTLC, expires onwhich had an initial term expiration date of December 31, 2021, and wewas amended in June 2021 to extend the term to December 31, 2023. We pay a fee to the NPS of a percentage of the majority of our sales occurring in Grand Teton National Park.

Flagg Ranch Company, a wholly-owned subsidiary, provides lodging, food and beverage services, retail, service station, recreation and other services on the Parkway located between Grand Teton National Park and Yellowstone National Park. Our concession contract with the NPS for the Parkway expires on October 31, 2026,2028, and we pay a fee to the NPS of a percentage of the majority of our sales occurring in the Parkway.


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UponPrior to expiration of these concession contracts, we will have the opportunity to bid against other prospective concessionaires for award of a new contract. 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. 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.

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 Actand 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

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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.

State, Local and Other Regulations

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.

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 also 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.

Available Information

We file with or furnish to the Securities and Exchange Commission (“SEC”) reports, including our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These reports, proxy statements and other information are available free of charge on our corporate website www.vailresorts.com as soon as reasonably practicable after they are electronically filed with or furnished to the SEC. Information on our websites does not constitute part of this document. Materials filed with or furnished to the SEC are also made available on its website at www.sec.gov. Copies of any materials we file with the SEC can be obtained at www.sec.gov or at the SEC’s public reference room at 100 F Street, N.E., Washington, D.C. 20549. Information on the operation of the public reference room is available by calling the SEC at 1-800-SEC-0330.


ITEM 1A.RISK FACTORS.

ITEM 1A.RISK FACTORS.

Our operations and financial results are subject to various risks and uncertainties that could adversely affect our financial position, results of operations and cash flows. The risks described below should carefully be considered together with the other information contained in this report.

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Risks Related to Our Business

The ongoing COVID-19 pandemic has had, and could continue to have, a significant negative impact on our financial condition and operations. Further, the spread of COVID-19 has caused severe disruptions in the U.S. and global economies and financial markets and could potentially create widespread business continuity issues of an as yet unknown magnitude and duration. Any future outbreak of any COVID-19 variants or any other highly infectious or contagious disease could have a similar impact.
The outbreak and continuing spread of COVID-19 has disrupted our business, and has had and could continue to have a significant negative impact on our business, financial performance and condition, operating results, liquidity and cash flows. Governmental authorities have issued and continue to issue a variety of mandates in an effort to slow the spread of COVID-19, including travel restrictions, border closures, restrictions on public gatherings, occupancy limits, “shelter at home’’ orders and advisories, and quarantine requirements. The outbreak of COVID-19 has impacted global economic activity and caused significant volatility in financial markets, with particular risk to the travel and leisure industry, which is disproportionately impacted by travel restrictions and other public health restrictions.

In response to the continued challenges associated with the spread of COVID-19, we have had to close certain Resorts at various times. For example, on March 30, 2021, towards the end of the North American operating season and following an order from the government of British Columbia as a result of an increase in COVID-19 cases in the region, we closed Whistler Blackcomb. Our other North American Resorts were generally operational throughout the 2020/2021 ski season, after closing early in the 2019/2020 season, and were open for 2021 summer activities. Our Australian Resorts were open for their 2021 winter season, however there were border closures, travel restrictions and public health orders in place throughout the country that impacted visitation to our Australian ski areas and caused periodic Resort closures. We are also monitoring public health orders and regulations that affect or may affect our winter operations for the 2021/2022 North American ski season.

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Our operations continue to be negatively impacted by COVID-19 and associated government mandated restrictions, including capacity limitations, border closures and travel restrictions, and mask and social distancing requirements. Additionally, we may impose our own COVID-19 related restrictions in addition to what is required by state and local governments in the interest of safety for our guests, employees and resort communities. Factors that could negatively impact our ability to successfully operate during the current COVID-19 pandemic or another pandemic include:

•our ability to open and keep open our Resorts during their respective ski seasons, including our North American Resorts for their upcoming winter season;
•our ability to attract and retain guests given the risks, or perceived risks, of gathering in public places;
•changes in consumer preferences during the pandemic;
•the willingness of guests to travel or purchase advance commitment products, such as our portfolio of pass products;
•existing or future restrictions imposed by governmental authorities, including quarantines, capacity limitations, vaccination mandates for visitors from certain areas, and indoor dining or other restrictions that may affect our operations or the ability of our guests to return to our Resorts;
•actual or perceived deterioration or weakness in economic conditions, unemployment levels, the job or housing markets, consumer debt levels or consumer confidence, as well as other adverse economic or market conditions due to COVID-19 or otherwise, and their collective impacts on demand for travel and leisure;
•our ability to incentivize and retain our current employees, and hire sufficient future seasonal employees;
•the risk of lawsuits related to COVID-19 or another pandemic;
•our ability to access debt and equity capital on attractive terms, or at all; and
•the impact of disruption and instability in the global financial markets or deterioration in credit and financing conditions on our access to capital necessary to fund operating costs, including maintenance capital spending, or to address maturing liabilities.

The extent and duration of the impact of COVID-19 on our business, consolidated results of operations, consolidated financial position and consolidated cash flows, will depend largely on future developments, including the duration of the virus (including any variants, which may be more contagious and/or impact the effectiveness of approved vaccines), vaccination rates in areas where our Resorts are located or our guests reside, any continuing or newly imposed travel restrictions or vaccination requirements in connection with travel, the related impact on factors affecting guest behavior, including consumer confidence and spending, and when we will be able to resume normal operations, all of which are highly uncertain and cannot be predicted.

COVID-19 continues to present material uncertainty and risk with respect to our business, financial performance and condition, operating results, liquidity and cash flows. To the extent the COVID-19 pandemic adversely affects our business and financial results, it may also have the effect of heightening many of the other risks described in the Risk Factors presented in this Annual Report on Form 10-K, and our subsequent filings with the SEC. Any future outbreak of any other highly infectious or contagious disease could have a similar impact.

Our Epic Coverage program may require us to provide significant refunds to our pass product holders, which would result in reduced revenue and also exposes us to the risk of customer complaints and negative perception about our pass products.
In April 2020, the Company introduced Epic Coverage, which is included with the purchase of all pass products for no additional charge. Epic Coverage offers refunds to pass product holders if certain qualifying personal or Resort closure events occur before or during the ski season, subject to express terms and conditions. Accordingly, to the extent that any of our Resorts need to be closed for all or specified portions of the ski season (including due to COVID-19), we could be required to provide a significant amount of refunds to our pass product holders, subject to express terms and conditions, which could have a material negative impact on our financial performance and condition.

The estimated amount of refunds reduce the amount of pass product revenue recognized by the Company. To estimate the amount of refunds under Epic Coverage, the Company considers (i) historical claims data for personal events, (ii) provincial, state, county and local COVID-19 regulations and public health orders, and (iii) the Company’s operating plans for its Resorts. The Company believes the estimates of refunds are reasonable; however, the program is relatively new and there continues to be uncertainty surrounding COVID-19, and therefore actual results could vary materially from such estimates, and the Company could be required to refund significantly higher amounts than estimated.

Epic Coverage has also resulted in customer complaints and negative perception by customers who believe they are entitled to a refund for events that do not qualify under the express terms and conditions of the program. Any complaints posted by customers on social media platforms, even if inaccurate, may harm our reputation, and may divert management’s time and attention away from other business matters.
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Leisure travel is particularly susceptible to various factors outside of our control, including terrorism, the uncertainty of military conflicts, the cost and availability of travel options and changing consumer preferences or willingness to travel.
Our business is sensitive to the willingness of our guests to travel. Acts of terrorism, pandemics, political events and developments in military conflicts in areas of the world from which we draw our guests could depress the public’s propensity to travel and cause severe disruptions in both domestic and international air travel and consumer discretionary spending, which could reduce the number of visitors to our Resorts and have an adverse effect on our results of operations. Many of our guests travel by air and the impact of higher prices for commercial airline services, availability of air services and willingness of guests to travel by air could cause a decrease in visitation by Destination guests to our Resorts. A significant portion of our guests also travel by vehicle and higher gasoline prices or willingness of guests to travel generally due to safety or traffic concerns could cause a decrease in visitation by guests who would typically drive to our Resorts. Higher cost of travel may also affect the amount that guests are willing to spend at our Resorts and could negatively impact our revenue particularly for lodging, ski school, dining and retail/rental.

Additionally, our success depends on our ability to attract visitors to our Resorts. Changes in consumer tastes and preferences, particularly those affecting the popularity of skiing and snowboarding, and other social and demographic trends could adversely affect the number of skier visits during a ski season. A significant decline in skier visits compared to historical levels would have a material adverse effect on our business, prospects, financial condition, results of operations and cash flows.

We are subject to the risk of prolonged weakness in general economic conditions including adverse effects on the overall travel and leisure related industries.
Skiing, travel and tourism are discretionary recreational activities that can entail a relatively high cost of participation and may be adversely affected by economic slowdown or recession. Economic conditions in North America, Europe and parts of the rest of the world, including high unemployment, erosion of consumer confidence, sovereign debt issues and financial instability in the global markets, may potentiallycould have negative effects on the travel and leisure industry and on our results of operations. See “Risks Related to Our Business—The ongoing COVID-19 pandemic has had, and could continue to have, a significant negative impact on our financial condition and operations. Further, the spread of COVID-19 has caused severe disruptions in the U.S. and global economies and financial markets and could potentially create widespread business continuity issues of an as yet unknown magnitude and duration. Any future outbreak of any COVID-19 variants or other highly infectious or contagious disease could have a similar impact.” As a result of these and other economic uncertainties, we have previously experienced and may continue to experience in the future, among other items, a change in booking trends such thatincluding where guest reservations are made much closer to the actual date of stay, a decrease in the length of stay, a decrease in consumer spending and/or a decrease in group bookings. We cannot predict what further impact these uncertainties may continue to have on overall travel and leisure or more specifically, on our guest visitation, guest spending or other related trends and the ultimate impact it will have on our results of operations. Additionally, the actual or perceived fear of weakness in the economy could also lead to decreased spending by our guests. This could be further be exacerbated by the fact that we charge some of the highest prices for single day lift tickets and ancillary services in the ski industry.industry; however, we offer pass products, including the Epic Day Pass, that are available at a discount to the single day lift ticket prices. In the event of a decrease in visitation and overall guest spending we may be requireddecide we need to offer a higher amount of discounts and incentives than we have historically, which would adversely impact our operating results. Our resortsResorts also serve as a destination for international guests. To the extent there are material changes in exchange rates relative to the U.S. dollar or travel restrictions in place due to COVID-19, it could impact the volume of international visitation.visitation, which could have a significant impact on our operating results.


We are vulnerable to unfavorable weather conditions and the impact of natural disasters.
Our ability to attract guests to our resortsResorts is influenced by weather conditions and by the amount and timing of snowfall during the ski season. Unfavorable weather conditions can adversely affect skier visits and our revenue and profits. Unseasonably warm weather may result in inadequate natural snowfall and reduce skiable terrain, which increases the cost of snowmaking and could render snowmaking, wholly or partially, ineffective in maintaining quality skiing conditions, including in areas which are not accessible by snowmaking equipment. In addition, a severe and prolonged drought could affect our otherwise adequate snowmaking water supplies or increaseOn the cost of snowmaking. Excessiveother hand, excessive natural snowfall may significantly increase the costs incurred to groom trails and may make it difficult for guests to access our mountain resorts. In the past 20 years, our resorts in the Rocky Mountain region of Colorado and Utah, the Sierra Nevada Mountains in Lake Tahoe and the Coast Mountains in British Columbia, Canada have averaged between 20 and 39 feet of annual snowfall, which is significantly in excess of the average for North American ski resorts. However, thereResorts.

There can be no assurance that our resortsResorts will receive seasonal snowfalls near their historical average inaverages. As an example of weather variability, during the future. For example,2017/2018 North American ski season, we experienced historically low snowfall across our western U.S. resortsResorts for the first half of the 2017/2018 ski season, with snowfall in Vail, Beaver Creek and Park City through January 31, 2018 at the lowest levels recorded in over 30 years while Tahoe was more than 50% below the 20-year average. Conversely, during the 2018/2019 North American ski season, our western U.S. Resorts experienced above-average snowfall while through December 31, 2019 for the 2019/2020 North American ski season, our Pacific Northwest Resorts (Whistler Blackcomb and
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Stevens Pass) experienced the lowest snowfall in over 30 years. During the 2020/2021 North American ski season, snowfall levels were well below average at our Colorado, Utah and Tahoe Resorts through the holiday season. Past snowfall levels or consistency of snow conditions can impact the levels of sales of season passes.pass products or other advanced bookings. Additionally, the early season snow conditions and skier perceptions of early season snow conditions can influence the momentum and success of the overall ski season. Unfavorable weather conditions can adversely affect our resortsResorts and lodging properties as guests tend to delay or postpone vacations if conditions differ from those that typically prevailare typical at such resortsResorts for a given season. The potential effects of climate change could also have a material adverse effect on our results of operations as warmer overall temperatures would likely adversely affect snowfall, which in turn would likely adversely affect skier visits and our revenue and profits. Although we have created geographic diversification to help mitigate the impact of weather variability, there is no way for us to predict future weather patterns or the impact that weather patterns may have on our results of operations or visitation.


A severe natural disaster, such as a forest fire, may interrupt our operations, damage our properties, reduce the number of guests who visit our resortsResorts in affected areas and negatively impact our revenue and profitability. Damage to our properties could take a long time to repair and there is no guarantee that we would have adequate insurance to cover the costs of repair and recoup lost profits. Furthermore, such a disaster may interrupt or impede access to our affected properties or require evacuations and may cause visits to our affected properties to decrease for an indefinite period. The ability to attract visitors to our resortsResorts is also influenced by the aesthetics and natural beauty of the outdoor environment where our resortsResorts are located. A severe forest fire or other severe impacts from naturally occurring events could negatively impact the natural beauty of our resortsResorts and have a long-term negative impact on our overall guest visitation as it would take several years for the environment to recover.


FailureAdditionally, there is scientific research that emissions of greenhouse gases continue to maintainalter the integritycomposition of the global atmosphere in ways that are affecting and securityare expected to continue affecting the global climate. The effect of climate change, including any impact of global warming, could have a material adverse effect on our results of operations as a result of increased weather variability and/or warmer overall temperatures, which would likely adversely affect skier visits and our revenue and profits.

Cyberattacks or other interruptions to or disruption of our internal, employee or guest datainformation technology systems and services could result in damages todisrupt our reputation and subject us to costs, fines or lawsuits. business.
Our business relies on the use of large volumes of data. We collect and retain guest data, including credit card numbers and other personal information, for various business purposes, including transactional marketing and promotional purposes. We also maintain personal information about our employees. We store and use data in a varietycontinuous operation of information technology systems including some systems maintained by service providers. Maintaining the integrity and security of that data can be costly and is critical to our business, and our guests and employees have a high expectation that we will adequately protect their personal information.


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Cyber-attacks could disrupt our business.services. Despite our efforts, our information networks and systems are vulnerable to service interruptions or to security breaches from inadvertent or intentional actions by our employees or vendors, natural disasters, system or fromequipment malfunctions, power outages, computer viruses or intentional attacks by malicious third parties. In recent years, thereparties, which could persist undetected for an extended period of time. Any interruption to these systems and services could adversely impact our business, including lost revenue, customer claims, damage to reputation, litigation, and/or denial or interruption to our processing of transactions and/or the services we provide to customers. We also provide information to third party service providers and rely on third party service providers for the provision of information technology services. There is a risk that the information held by third parties could be disclosed, otherwise compromised, or disrupted. We carry insurance for many of these adverse events, including cyber security insurance, but our insurance coverage may not always be sufficient to meet all of our liabilities.

There has been a rise in the number of sophisticated cyber-attackscyberattacks on network and information systems, and asincluding ransomware attacks that prevent the target from accessing its own data and/or systems until a ransom is paid. As a result, the risks associated with such an event continue to increase. We have experienced and expect to continue to be subject to, cybersecurity threats and incidents, none of which has been material to us to date. Although weWe have taken, and continue to take, steps to address these concerns by implementing network security and internal controls,controls. However, there can be no assurance that a system interruption, security breach or unauthorized access will not occur. Cyber threats and attacks are constantly evolving and becoming more sophisticated, which increases the difficulty and cost of detecting and defending against them. Cyber threats and attacks can have cascading impacts across networks, systems and systems. Those events may include process breakdowns, security architecture or design vulnerabilities, or may result from the acts of third parties, such as computer hackings, cyber-attacks, computer viruses, worms or other destructive or disruptive software, denial of service attacks, malicious social engineering or other malicious activities.operations. Any such interruption, breach or unauthorized access to our network or systems, or the networks or systems of our vendors, could adversely affect our business operations and result in the loss of critical or sensitive confidential information or intellectual property, as well as impact our ability to meet regulatory or compliance obligations, and could result in financial, legal, business and reputational harm to us. These events also could result in large expenditures to repair or replace the damaged properties, products, services, networks or information systems to protect them from similar events in the future.


LeisureFailure to maintain the integrity and business travel are particularly susceptible to various factors outsidesecurity of our control, including terrorism, the uncertainty of military conflicts, outbreaks of contagious diseases, the costinternal, employee or guest data could result in damages to our reputation and availability of travel options and change in consumer preferences. subject us to costs, fines or lawsuits.
Our business relies on the use of large volumes of data. We collect and retain guest data, including credit card numbers and other sensitive personal information, for various business purposes, such as processing transactions, marketing and other promotional purposes. We also maintain personal information about our employees. We could make faulty decisions if data is sensitiveinaccurate or incomplete. Maintaining the integrity and security of data can be costly and is critical to the willingness ofour business, and our guests to travel. Acts of terrorism, the spread of contagious diseases, political events and developments in military conflicts in areas of the world from whichemployees have a high expectation that we draw our guests could depress the public’s propensity to travel and cause severe disruptions in both domestic and international air travel and consumer discretionary spending, which could reduce the number of visitors to our resorts and have an adverse effect on our results of operations. Many of our guests travel by air and the impact of higher prices for commercial airline services and availability of air services could cause a decrease in visitation by Destination guests to our resorts.will adequately protect their personal information. A significant portiontheft,
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loss, loss of access to, or fraudulent use of customer, employee, or company data held by us or our guests also travel by vehicle and higher gasoline pricesservice providers could adversely impact our guests’ willingness to travel to our resorts. Higher cost of travel may also affect the amount that guests are willing to spend at our resortsreputation, and could negatively impact our revenue particularly for lodging, ski school, dining and retail/rental.

Additionally, our success depends on our ability to attract visitors to our ski resorts. Changesresult in consumer tastes and preferences, particularly those affecting the popularity of skiing and snowboarding,significant remedial and other social and demographic trends could adversely affect the number of skier visits during a ski season. A significant decline in skier visits compared to historical levels would have a material adverse effect on our business, prospects, financial condition, results of operations and cash flows.expenses, fines, and/or litigation.


Our business is highly seasonal.
Our mountain and lodging operations are highly seasonal in nature. Peak operating season for our North American mountain resortsResorts is from late November to late April,mid-April, and accordingly, revenue and profits from our mountain and most of our lodging operations are substantially lower and historically result in losses from late spring to late fall. Conversely, peak operating seasons for Perisher,our Australian Resorts, GTLC and Flagg Ranch, mountain summer activities (including our Epic Discovery program), sightseeing and our golf courses generally occur from June to the end of September. Revenue and profits generated by Perisher,our Australian Resorts, GTLC and Flagg Ranch, mountain summer activities/sightseeing and golf peak season operations are not nearly sufficient to fully offset our off-season losses from our other mountain and lodging operations. For Fiscal 2018, 78%2021, approximately 82% of total combined Mountain and Lodging segment net revenue (excluding Lodging segment revenue associated with reimbursement of payroll costs) was earned during our second and third fiscal quarters. This seasonality is partially mitigated by the sale of season passespass products (which for Fiscal 20182021 accounted for approximately 47%61% of the total lift revenue) predominately occurring during the period prior to the start of the ski season as the cash from those sales is collected in advance and revenue is mostly recognized in the second and third quarters. In addition, the timing of major holidays and school breaks can impact vacation patterns and therefore visitation at our destination mountain resortsResorts and urbanregional ski areas. If we were to experience an adverse event or realize a significant deterioration in our operating results during our peak periods (our fiscal second and third quarters) we would be unable to fully recover any significant declines due to the seasonality of our business.business (for example, the outbreak of the COVID-19 pandemic which has resulted in Resort closures). See “Risks Related to Our Business—The ongoing COVID-19 pandemic has had, and could continue to have, a significant negative impact on our financial condition and operations. Further, the spread of COVID-19 has caused severe disruptions in the U.S. and global economies and financial markets and could potentially create widespread business continuity issues of an as yet unknown magnitude and duration. Any future outbreak of any COVID-19 variant or other highly infectious or contagious disease could have a similar impact.”. Operating results for any three-month period are not necessarily indicative of the results that may be achieved for any subsequent quarter or for a full fiscal year (see Notes to Consolidated Financial Statements).


As a result legislation enacted in 2011, the Forest Service is authorized to permit year-round recreational activities on land owned by the Forest Service. This allows our mountain resorts on Forest Service land to offer more summer-season recreational opportunities, including our Epic Discovery program that we have launched at Heavenly, Vail and Breckenridge. We anticipate that as these summer activities mature, and with Whistler Blackcomb’s robust summer activities and the activities at our other resorts, we could realize substantial incremental summer guest visitation and revenue. However, our summer activities may not generate the projected revenue and profit margins we expect, and even if our future plans are successful, we do not expect that these enhanced summer operations will fully mitigate the seasonal losses that our mountain operations experience from late spring to late fall.

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We face significant competition.
The ski resortResort and lodging industries are highly competitive. The number of U.S. skier visits has generally ranged between 51 million and 61 million annually over the last decade, with approximately 53.3 million visits for the 2017/2018 U.S. ski season. There are approximately 470745 ski areas in North America, including approximately 460 in the U.S. that serve local and destination guests, and these ski areas can be more or less impacted by weather conditions based on their location and snowmaking capabilities. The factors that we believe are important to customers include:


•proximity to population centers;
•availability and cost of transportation to ski areas;
•availability and quality of lodging options in resort areas;
•ease of travel to ski areas (including direct flights by major airlines);
•pricing of lift tickets and/or season passes and pass products;
•the magnitude, quality and price of related ancillary services (ski school, dining and retail/rental), amenities and lodging;
•snowmaking facilities;
•type and quality of skiing and snowboarding offered;
•duration of the ski season;
•weather conditions; and
•reputation.


There are many competing options for our guests, including other major resorts in Colorado, Utah, California, Nevada, the Pacific Northwest, Northeast, Southwest and British Columbia, Canada, and other major destination ski areas worldwide. Our guests can choose from any of these alternatives, as well as non-skiing vacation options and destinations around the world. In addition, other forms of leisure such as sporting events and participation in other competing indoor and outdoor recreational activities are available to potential guests.


RockResorts hotels, our other hotels and our property management business compete with numerous other hotel and property management companies that may have greater financial resources than we do and they may be able to adapt more quickly to changes in customer requirements or devote greater resources to promotion of their offerings than us.


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The high fixed cost structure of mountain resort operations can result in significantly lower margins if revenues decline.
The cost structure of our mountain resortResort operations has a significant fixed component with variable expenses including, but not limited to, land use permit or lease fees and other resort related fees; credit card fees; retail/rental cost of sales; labor; and resort, dining and ski school operations. Any material declines in the economy, elevated geopolitical uncertainties and/or significant changes in historical snowfall patterns, as well as other risk factors discussed herein, could adversely affect revenue. See “Risks Related to Our Business—The ongoing COVID-19 pandemic has had, and could continue to have, a significant negative impact on our financial condition and operations. Further, the spread of COVID-19 has caused severe disruptions in the U.S. and global economies and financial markets and could potentially create widespread business continuity issues of an as yet unknown magnitude and duration. Any future outbreak of any COVID-19 variant or other highly infectious or contagious disease could have a similar impact.” As such, our margins, profits and cash flows may be materially reduced due to declines in revenue given our relatively high fixed cost structure. In addition, increases in expenses as a result of inflation or other economic factors may adversely impact wages and other labor costs, energy, healthcare, insurance, transportation and fuel, cost of goods, property taxes, minimum lease payments and other expenses included in our fixed cost structure, which may also reduce our margin, profits and cash flows.


We may not be able to fund resort capital expenditures.
We regularly expend capital to construct, maintain and renovate our mountain resortsResorts and properties in order to remain competitive, maintain the value and brand standards of our mountain resortsResorts and properties and comply with applicable laws and regulations. We cannot always predict where capital will need to be expended in a given fiscal year and capital expenditures can increase due to forcescircumstances beyond our control. We anticipate that resortIn March 2021, we announced our full capital expenditures will be approximately $150 millionplan for calendar year 2018, excluding2021, pursuant to which we anticipated investments for U.S. summer related activities and one-time acquisition and integration related capital expenditures. We also expect to investwe would spend approximately $21 million in capital expenditures for the integration of Stevens Pass, Okemo, Mount Sunapee, Crested Butte, Stowe and the completion of Whistler Blackcomb integration, as well as approximately $3 million in calendar year 2018 for summer investments. Additionally, we plan to invest $35 million over the next two years related to the acquisitions of Stevens Pass, Okemo, Mount Sunapee and Crested Butte, in addition to an increase in annual ongoing capital expenditures of $7$135 million to support the addition$140 million, including one-time items associated with integrations of these four resorts. $5 million and approximately $12 million of reimbursable investments.

Our ability to fund capital expenditures will depend on our ability to generate sufficient cash flow from operations and/or to borrow from third parties in the debt or equity markets. We cannot provide assurances that our operations will be able to generate sufficient cash flow to fund such costs,capital expenditures, or that we will be able to obtain sufficient financing on adequate terms, or at all. Our ability to generate cash flow and to obtain third-party financing will depend upon many factors, including:


•our future operating performance;
•general economic conditions and economic conditions affecting the resort industry, the ski industry and the capital markets;
•competition; and
•legislative and regulatory matters affecting our operations and business;


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Any inability to generate sufficient cash flows from operations or to obtain adequate third-party financing could cause us to delay or abandon certain projects and/or plans.


A disruption in our water supply would impact our snowmaking capabilities and operations.operations.
Our operations are heavily dependent upon our access to adequate supplies of water for snowmaking and to otherwise conduct our operations. Our mountain resortsResorts are subject to federal, state, provincial and local laws and regulations relating to water rights. Changes in these laws and regulations may adversely affect our operations. For example, the Forest Service could develop new SUP language that could potentially affect our water rights, and recently the Forest Service finalized a new national water clause for all ski area SUPs. Although the recent change will not require any private water rights to be transferred to the Forest Service, future modified language could have an effect on our water rights. In addition, a severe and prolonged drought conditions may adversely affect our water supply.supply and increase the cost of snowmaking. A significant change in law or policy, impact from climate change or any other interference with our access to adequate supplies of water to support our current operations or an expansion of our operations would have a material adverse effect on our business, prospects, financial position, results of operations and cash flows.


We rely on various government permits and landlord approvals. approvals at our U.S. resorts.
Our resortU.S. Resort operations require permits and approvals from certain federal, state local and foreignlocal authorities, including the Forest Service, the Province of British Columbia, U.S. Army Corps of Engineers, the States of Vermont and New Hampshire NPS and the OEH, an agency of the New South Wales government.NPS. Virtually all of our ski trails and related activities, including our current and proposed comprehensive summer activities, plan, at Vail Mountain, Breckenridge, Keystone, Crested Butte, Stevens Pass, Heavenly, Kirkwood, andMount Snow, Wildcat, a majority of Beaver Creek and portions of Attitash are located on National Forest land. The Forest Service has granted us permits to use these lands, but maintains the right to review and approve many operational matters, as well as the location, design and construction of improvements in these areas. Currently,The expiration dates for our permits expire onare set forth in the following dates:Business section of this Form 10-K under the heading “Contracts with Governmental Authorities for Resort Operations”.


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Forest Service ResortExpiration Date
BreckenridgeDecember 31, 2029
Vail MountainDecember 1, 2031
KeystoneDecember 31, 2032
Beaver CreekNovember 8, 2039
Crested ButteSeptember 27, 2058
Stevens PassAugust 15, 2058
HeavenlyMay 1, 2042
KirkwoodMarch 1, 2052




The Forest Service can terminate or amend these permits if, in its opinion, such termination is required in the public interest. A termination or amendment of any of our permits could have a materially adverse effect on our business and operations. In order to undertake improvements and new development, we must apply for permits and other approvals. These efforts, if unsuccessful, could impact our expansion efforts. Furthermore, Congress may materially increase the fees we pay to the Forest Service for use of these National Forest lands. Additionally, our operations at Whistler Blackcomb are located on Crown Land within the traditional territory of the Squamish and Lil’wat Nations, and the operations and future development of both Whistler Mountain and Blackcomb Mountain are governed by Master Development Agreements, which expire on February 23, 2077.

Stowe and Okemo are partially located on land we lease from the State of Vermont, and Mount Sunapee is located on land we lease from the State of New Hampshire. We are required to seek approval from such states for certain developments and improvements made to the resort. OurCertain other resorts are operated on land under long term leases with third parties. For example, operations at our Northstar, and Park City resortsand Mad River Mountain Resorts are conducted pursuant to long-term leases with third parties who require us to operate the resortsResorts in accordance with the terms of the leases and seek certain approvals from the respective landlords for improvements made to the resorts.Resorts. The initial lease term for Northstar with affiliates of EPR Properties expires in January 2027 and allows for three 10-year renewal options. We entered into a transaction agreement, master lease agreement and ancillary transaction documents with affiliate companies of Talisker Corporation (“Talisker”), and the initial lease term for our Park City resort with Talisker expires in May 2063 and allows forwith six 50-year renewal options. Additionally, GTLC and Flagg Ranch operate under concessionaire agreements with the NPS that expire on December 31, 2023 and October 31, 2028, respectively. There is no guarantee that at the end of the lease/license or agreements under which we operate our Resorts we will renew or, if desired, be able to negotiate new terms that are favorable to us. Additionally, our Resorts that operate on privately-owned land are subject to local land use regulation and oversight by county and/or town governments, and we may not be able to obtain the requisite approvals needed for resort improvements or expansions. Failure to comply with the provisions, obligations and terms (including renewal requirements and deadlines) of our material permits and leases could adversely impact our operating results.

We rely on foreign government leases and landlord approvals, and are subject to certain related laws and regulations, at our international resorts.
Our international Resort operations require permits and approvals from certain foreign authorities, including the Province of British Columbia and the New South Wales and Victoria, Australia governments. Our operations at Whistler Blackcomb are located on Crown Land within the traditional territory of the Squamish and Lil’wat Nations, and the operations and future development of both Whistler Mountain and Blackcomb Mountain are governed by Master Development Agreements, which expire on February 23, 2077. We have a lease and a license for Perisher within the Kosciusko National Park which expires in June 2048, with an option to renew for an additional period of 20 years. Perisher relies on a suite of planning approvals (and existing use rights) granted under the Australian EPA Act to operate the resort. Strategic planning documents have been adopted to provide a framework for the assessment and approval of future development at the resort. Perisher also holds a number of environmental approvals to regulate its operations, including an environment protection license and a suite of dangerous goods licenses related to the storage of diesel, heating oil and propane in storage tanks across the resort. Additionally, GTLCEach of Falls Creek and Flagg Ranch operatea majority of Hotham is located in the Alpine National Park in Victoria, Australia that is permanently reserved under concessionaire agreements with the NPSCrown Land Act and subject to the ARM Act. The ARM Act established the Falls Creek RMB and the Hotham RMB, which is responsible for the management and collection of fees from Falls Creek and Hotham, respectively, and the ARM Regulations give each of the Falls Creek RMB and the Hotham RMB certain discretion over the operations of Falls Creek and Hotham, respectively, including the authority to (i) declare the snow season, (ii) temporarily close the applicable resort if entry would be a significant danger to public safety, and (iii) determine which portions of the applicable resort are open to the public and the activities that expireare permitted on December 31, 2021 and October 31, 2026, respectively.those portions of such resort. There is no guarantee that at the end of the initial lease/license or agreements under which we operate our resortsResorts we will renew or, if desired, be able to negotiate new terms that are favorable to us. Additionally, our resorts that operate on privately-

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owned land are subject to local land use regulation and oversight by county and/or town government and may not be able to obtain the requisite approvals needed for resort improvements or expansions. Failure to comply with the provisions, obligations and terms (including renewal requirements and deadlines) of our material permits and leases could adversely impact our operating results.


We are subject to extensive environmental and health and safety laws and regulations in the ordinary course of business.
Our operations are subject to a variety of federal, state, local and foreign environmental laws and regulations including those relating to air emissions, discharges to water, storage, treatment and disposal of wastes and other liquids, land use, remediation of contaminated sites, protection of natural resources such as wetlands and sustainable visitor or tourist use and enjoyment. For example, future expansions of certain of our mountain facilities must comply with applicable forest plans approved under the National Forest Management Act, federal, state and foreign wildlife protection laws or local zoning requirements, and in Vermont, our operations must comply with Act 250, which regulates the impacts of development to, among other things, waterways, air, wildlife and earth resources, and any projects must be completed pursuant to a Master Plan. In addition, most projects to improve, upgrade or expand our ski areas are subject to environmental review under the NEPA, FRPA, Act 250, the CEQA, the Australian NPW Act, or the Australian EPA Act or the Australian EP Act, as applicable. The NEPA and CEQA require the Forest Service, or other governmental entities, to study any proposal for potential environmental impacts and include various alternatives in its analysis. Our ski area improvement proposals may not be approved or may be approved with modifications that substantially increase the cost or decrease the
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desirability of implementing the project. Our facilities are subject to risks associated with mold and other indoor building contaminants. From time to time our operations are subject to inspections by environmental regulators or other regulatory agencies. We are also subject to worker health and safety requirements as well as various state and local public health laws, rules, regulations and orders related to COVID-19, including mask and social distancing requirements. We believe our operations are in substantial compliance with applicable material environmental, health and safety requirements. However, our efforts to comply do not eliminate the risk that we may be held liable, incur fines or be subject to claims for damages, and that the amount of any liability, fines, damages or remediation costs may be material for, among other things, the presence or release of regulated materials at, on or emanating from properties we now or formerly owned or operated, newly discovered environmental impacts or contamination at or from any of our properties, or changes in environmental laws and regulations or their enforcement.


Changes in security and privacy laws and regulations could increase our operating costs, increase our exposure to fines and litigation, and adversely affect our ability to market our products, properties and services effectively. effectively.
The information, security, and privacy requirements imposed by applicable laws and governmental regulation and the requirements of the payment card industry are increasingly demanding in the U.S. and other jurisdictions where we operate. Maintaining compliance with applicable security and privacy regulations may increase our operating costs or our exposure to potential fines and litigation in connection with the enforcement of such regulations, or otherwise impact our ability to market our products, properties and services to our guests. Additionally, we rely on a variety of direct marketing techniques,Any future changes or restrictions in U.S. or international privacy laws could also adversely affect our operations, including email marketing, online advertising, and postal mailings.our ability to transfer guest data. Changes in U.S. or international law affecting marketing, solicitation or privacy, could adversely affect our marketing activities and force changes in our marketing strategy or increase the costs of marketing. If access to lists of potential customers from travel service providers or other companies with whom we have relationships was prohibited or otherwise restricted, our ability to develop new customers and introduce them to our products could be impaired.


We rely on information technology to operate our businesses and maintain our competitiveness, and any failure to adapt to technological developments or industry trends could harm our business or competitive position.
We depend on the use of sophisticated information technology and systems for central reservations, point of sale, marketing, customer relationship management and communication, procurement, maintaining the privacy of guest and employee data, administration and technologies we make available to our guests. We must continuously improve and upgrade our systems and infrastructure to offer enhanced products, services, features and functionality, while maintaining the reliability and integrity of our systems, network security and infrastructure. Our future success also depends on our ability to adapt our infrastructure to meet rapidly evolving consumer trends and demands and to respond to competitive service and product offerings. In addition, weWe may not be able to maintain our existing systems or replace or introduce new technologies and systems as quickly as we would like or in a cost-effective manner. Delays or difficulties implementing new or enhanced systemsmanner, which may keep us from achieving the desired results in a timely manner, to the extent anticipated, or at all. Any interruptions, outages or delays in our systems, or deterioration in their performance, could impair our ability to process transactions and could decrease the quality of service we offer to our guests. Also, we may be unable to devote adequate financial resources to new technologies and systems in the future. If any of these events occur, our business and financial performance could suffer.


We may not be able to hire, train, reward and retain adequate team members and determine and maintain adequate staffing, including our seasonal workforce, which may impact our ability to achieve our operating, growth and financial objectives.
Our long-term growth and profitability depend partially on our ability to recruit and retain high-quality employees to work in and manage our Resorts. Adequate staffing and retention of qualified employees is a critical factor affecting our guests’ experiences in our Resorts. Maintaining adequate staffing requires precise workforce planning which has been complicated and is unpredictable due the impacts of the COVID-19 pandemic on guest preferences and on labor markets. The market for the most qualified talent continues to be competitive and we must provide competitive wages, benefits and workplace conditions to attract and retain our most qualified employees. Year round employees may seek other employment and seasonal workforce. employees may decline to return, to be re-hired, or to be hired for the first time. Personal or public health concerns related to COVID-19 might make some employees and potential candidates reluctant to work in enclosed environments such as our hotels, restaurants and retail/rental stores. Resort-area housing could be even more limited than usual, making it difficult for employees to obtain available, affordable housing.

Our mountain and lodging operations are highly dependent on a large seasonal workforce. We recruit year-round to fill thousands of seasonal staffing needs each season and work to manage seasonal wages and the timing of the hiring process to ensure the appropriate workforce is in place. Furthermore, we cannot guarantee that we will be able to recruit and hire adequate seasonal personnel as the business requires. Immigration law reformChanges in immigration laws could also impact our workforce because we recruit and hire foreign nationals as part of our seasonal workforce. Increased seasonalFor example, as a result of a 2020 executive order in the United States suspending the issuance of several visas for foreign workers, we were unable to hire foreign nationals for the 2020/2021 North America ski season. A shortage of international workers based on immigration and cultural exchange limitations, failure to recruit and retain new domestic employees in a timely manner, higher than expected attrition levels, or increased wages or an inadequate workforce could have an adverse impact on our results of operations.


all
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could affect our ability to open and operate parts of our Resorts, deliver guest service at traditional margins or achieve our labor cost objectives.

We are subject to risks associated with our workforce, including increased labor costs.
We are subject to various federal, state and foreign laws governing matters such as minimum wage requirements, sick leave pay, overtime compensation and other working conditions, work authorization requirements, discrimination and family and medical leave. Labor costsCost of labor and labor-related benefits are primary components in the cost of our operations. Labor shortages, affordable employee housing shortages and increased employee turnover and health care mandates could also increase our labor costs and labor-related benefits. As minimum wage rates increase, including further potential federal and state legislative changes to the minimum wage rate, (for example, the recent California legislation increasing minimum wage), we may need to increase not only the wages of our minimum wage employees but also the wages paid to employees at wage rates that are above the minimum wage. Additionally, new regulations governingDuring Fiscal 2021, we announced a substantial investment in our employees by increasing the payment of overtime for salaried employees may be implemented,minimum wage to $15 at our Resorts across Colorado, California, Utah, Washington, New York and we may incur additional costs to comply withVermont, as well as other increases at our Resorts in the revised rules.eastern U.S. From time to time, we have also experienced non-union employees attempting to unionize. While only a very small portion of our employees are unionized at present, we may experience additional union activity in the future, which could lead to disruptions in our business, increases in our operating costs and/or constraints on our operating flexibility. These potential labor impacts could adversely impact our results of operations.


If we do not retain our key personnel, our business may suffer.
The success of our business is heavily dependent on the leadership of key management personnel, including our senior executive officers. If any of these persons were to leave, it could be difficult to replace them, and our business could be harmed. We do not maintain “key-man” life insurance on any of our employees.


We are subject to litigation in the ordinary course of business. We are, from time to time, subject to various asserted or unasserted legal proceedings and claims. Any such claims, regardless of merit, could be time consuming and expensive to defend and could divert management’s attention and resources. While we believe we have adequate insurance coverage and/or accrue for loss contingencies for all known matters that are probable and can be reasonably estimated, we cannot assure you that the outcome of all current or future litigation will not have a material adverse effect on us and our results of operations.

Our business depends on the quality and reputation of our brands, and any deterioration in the quality or reputation of these brands, could have an adverseincluding as a result of misappropriation of our intellectual property or the risk of accidents occurring at our mountain resorts or competing mountain resorts, may reduce visitation and negatively impact on our business. operations.
A negative public image or other adverse events could affect the reputation of one or more of our mountain resorts,Resorts, other destination resorts, hotel properties and other businesses or more generally impact the reputation of our brands. Any resulting harm on our business may be immediate without affording us an opportunity for redress or correction. Our ability to attract and retain guests depends, in part, upon the external perceptions of the Company, the quality and safety of our Resorts, services and activities, including summer activities, and our corporate and management integrity. While we maintain and promote an on-mountain safety program, there are inherent risks associated with our Resort activities. From time to time in the past, accidents and other injuries have occurred on Resort property. An accident or an injury at any of our Resorts or at resorts operated by competitors, particularly an accident or injury involving the safety of guests and employees that receives media attention, could negatively impact our brand or reputation, cause loss of consumer confidence in us, reduce visitation at our Resorts, and negatively impact our results of operations.

The considerable expansion in the use of social media over recent years has compounded the impact of negative publicity. Information posted on social media platforms at any time may be adverse to our interests or may be inaccurate, each of which may harm our reputation or business. If the reputation or perceived quality of our brands declines, our market share, reputation, business, financial condition or results of operations could be adversely impacted. Additionally, our intellectual property, including our trademarks, domain names and other proprietary rights, constitutes a significant part of our value. Any misappropriation, infringement or violation of our intellectual property rights could also diminish the value of our brands and their market acceptance, competitive advantages or goodwill, which could adversely affect our business.


There is a risk of accidents occurring at our mountain resorts or competing mountain resorts which may reduce visitation and negatively impact our operations. Our ability to attract and retain guests depends, in part, upon the external perceptions of the Company, the quality and safety of our resorts, services and activities, including summer activities, and our corporate and management integrity. While we maintain and promote an on-mountain safety program, there are inherent risks associated with our resort activities. An accident or an injury at any of our resorts or at resorts operated by competitors, particularly an accident or injury involving the safety of guests and employees that receives media attention, could negatively impact our brand or reputation, cause loss of consumer confidence in us, reduce visitation at our resorts, and negatively impact our results of operations. The considerable expansion in the use of social media over recent years has compounded the impact of negative publicity. If any such incident occurs during a time of high seasonal demand, the effect could disproportionately impact our results of operations.

Our acquisitions, including Okemo, Crested Butte, Stevens Pass, Mount Sunapee or future acquisitions might not be successful.We
In recent years, we have acquiredcompleted numerous acquisitions and may continue to acquire certain mountain resorts, hotel properties and other businesses complementary to our own, as well as developable land in proximity to our resorts.Resorts. Acquisitions are complex to evaluate, execute and integrate. We cannot ensure that we will be able to accurately evaluate or successfully integrate and manage acquired mountain resorts, properties and businesses and increase our profits from these operations. We continually evaluate potential acquisitions both domestically and internationally and intend to actively pursue acquisition opportunities, some of which could be significant. As a result, we face various risks from acquisitions, including:


•our evaluation of the synergies and/or long-term benefits of an acquired business;
•our inability to integrate acquired businesses into our operations as planned;
•diversion of our management’s attention;
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•increased expenditures (including legal, accounting and due diligence expenses, higher administrative costs to support the acquired entities, information technology, personnel and other integration expenses);
•potential increased debt leverage;
•potential issuance of dilutive equity securities;

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•litigation arising from acquisition activity;
•potential impairment of goodwill, intangible or other intangible asset impairments;tangible assets; and
•unanticipated problems or liabilities.


In addition, we run the risk that any new acquisitions may fail to perform in accordance with expectations, and that estimates of the costs of improvements and integration for such properties may prove inaccurate.


We have recently acquired companies that were not subject to rules and regulations promulgated under the Sarbanes-Oxley Act of 2002, as amended (“Sarbanes-Oxley”), and, therefore, they may lack the internal controls of a U.S. public company, which could ultimately affect our ability to ensure compliance with the requirements of Section 404 of Sarbanes-Oxley. We have recently acquired companies that were not previously subject to the rules and regulations promulgated under Sarbanes-Oxley and accordingly were not required to establish and maintain an internal control infrastructure meeting the standards promulgated under Sarbanes-Oxley. Our assessment of and conclusion on the effectiveness of our internal control over financial reporting as of July 31, 2018 did not include the internal controls of Okemo, Crested Butte, Stevens Pass and Mount Sunapee, all of which were acquired after our fiscal year ended July 31, 2018.

Although our management will continue to review and evaluate the effectiveness of our internal controls in light of these acquisitions, we cannot provide any assurances that there will be no significant deficiencies or material weaknesses in our internal control over financial reporting. Any significant deficiencies or material weaknesses in the internal control structure of our acquired businesses may cause significant deficiencies or material weaknesses in our internal control over financial reporting, which could have a material adverse effect on our business and our ability to comply with Section 404 of the Sarbanes-Oxley Act.

Our international operations subject us to additional risks.
As a result of the acquisitions of Perisher and Whistler Blackcomb in Canada and Perisher, Hotham and Falls Creek in Australia, and potential future international acquisitions, we have increasedand may continue to increase our operations outside of the United States. We are accordingly subject to a number of risks relating to doing business internationally, any of which could significantly harm our business. These risks include:

•restriction on the transfer of funds to and from foreign countries, including potentially negative tax consequences;
•currency exchange rates;
•increased exposure to general market and economic conditions outside the United States;
•additional political risk;
•compliance with international laws and regulations (including anti-corruption regulations, such as the U.S. Foreign Corrupt Practices Act);
•data security;security, including requirements that local customer data be stored locally and not transferred to other jurisdictions; and
•foreign tax treaties and policies.


Exchange rate fluctuations could result in significant foreign currency gains and losses and affect our business results.
We are exposed to currency translation risk because the resultslocal currency utilized in the operations of Whistler Blackcomb, Perisher, Hotham and PerisherFalls Creek are reported in their local currencies, which we then translate todifferent than our functional currency, the U.S. dollars for inclusion in our consolidated financial statements.dollar. As a result, changes in foreign exchange rates, in particular between the Canadian dollar, Australian dollar and the U.S. dollar, affect the amounts we record for our foreign assets, liabilities, revenues and expenses, and could have a negative effect on our financial results. We currently do not enter into hedging arrangements to minimize the impact of foreign currency fluctuations. We expect that our exposure to foreign currency exchange rate fluctuations will increase as Whistler Blackcomb and Perisherour international operations grow and if we acquire otheradditional international resorts.

We are subject to accounting and tax regulations and use certain estimates and judgments that may differ significantly from actual results, including adverse determinations by tax authorities. Implementation of existing and future legislation, rulings, standards and interpretations from the Financial Accounting Standards Board (“FASB”) or other regulatory bodies could affect the presentation of our financial statements and related disclosures. Future regulatory requirements could significantly change our current accounting practices and disclosures. Such changes in the presentation of our financial statements and related disclosures could change an investor’s interpretation or perception of our financial position and results of operations.

We use many methods, estimates and judgments in applying our accounting policies (see “Critical Accounting Policies” in Item 7 of this Form 10-K). Such methods, estimates and judgments are, by their nature, subject to substantial risks, uncertainties and assumptions, and factors may arise over time that lead us to change our methods, estimates and judgments. Changes in those methods, estimates and judgments could significantly affect our results of operations.


We are subject to tax laws and regulations in multiple jurisdictions, and changes to those laws and regulations or interpretations thereof or adverse determinations by tax authorities may adversely affect us.
We are subject to income and other taxes in the United States and in multiple foreign jurisdictions. Due to economic and political conditions, tax rates in various jurisdictions may be subject to significant change. Our effective tax rates could be affected by changes in the mix of earnings in countries with

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differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities, or changes in tax laws or their interpretation.


We are also subject to the examination of tax returns and other tax matters by the Internal Revenue Service (“IRS”) and other tax authorities and governmental bodies. We regularly assessesassess the likelihood of an adverse outcome resulting from these examinations to determine the adequacy of our provision for taxes. There can be no assurance as to the outcome of these examinations. If our effective tax rates were to increase or if the ultimate determination of our taxes owed is for an amount in excess of amounts previously accrued, our financial condition, operating results and cash flows could be adversely affected.

The impact of recently enacted tax reform legislation in the U.S. on our business is uncertain. The recent enactment of the Tax Cuts and Jobs Act (the “Tax Act”) has significantly changed U.S. federal income taxation of U.S. corporations by reducing the U.S. corporate income tax rate, limiting interest deductions, permitting immediate expensing of certain capital expenditures, adopting elements of a territorial tax system, imposing a one-time Transition Tax on all undistributed earnings and profits of certain U.S. owned foreign corporations, introducing new anti-base erosion provisions, revising the rules governing net operating losses and the rules governing foreign tax credits, repealing the performance-based compensation exception to the $1 million deduction limit on executive compensation and expanding the scope of employees to whom the limit applies, and eliminating the deductibility of certain fringe benefits, among other changes. Many of these changes are effective immediately, without any transition periods or grandfathering for existing transactions. The Tax Act is unclear in many respects and could be subject to potential amendments and technical corrections, as well as interpretations and implementation of regulations by the U.S. Treasury Department and IRS, any of which could lessen or increase certain adverse impacts of the legislation. In addition, it is unclear how these U.S. federal income tax changes will affect state and local taxation, which often uses federal taxable income as a starting point for computing state and local tax liabilities, or how the changes will be viewed by foreign governments.

Our analysis and interpretation of the Tax Act is preliminary and ongoing, and our implementation may include judgments and estimates that differ from the final IRS regulations and could have a material impact on our financial statements. We have identified the change in the corporate tax rate, including its effects on the remeasurement of our net deferred tax liabilities, as well as the Transition Tax, and the related impact on our consolidated financial statements. There may be other material adverse effects resulting from the legislation that we have not yet identified. While some of the changes made by the Tax Act may adversely affect the Company in one or more reporting periods and prospectively, other changes may be beneficial. We continue to work with our tax advisors to determine the full impact that the recent tax legislation as a whole will have on us.


Risks Relating to Our Capital Structure


Our stock price is highly volatile.
The market price of our stock is highly volatile and subject to wide fluctuations in response to factors such as the following, some of which are beyond our control:


•quarterly variations in our operating results;
•operating results that vary from the expectations of securities analysts and investors;
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•change in valuations, including our real estate held for sale;
•changes in the overall travel, gaming, hospitality and leisure industries;
•changes in expectations as to our future financial performance, including financial estimates by securities analysts and investors or such guidance provided by us;
•announcements by us or companies in the travel, gaming, hospitality and leisure industries of significant contracts, acquisitions, dispositions, strategic partnerships, joint ventures, capital commitments, plans, prospects, service offerings or operating results;
•additions or departures of key personnel;
•future sales of our securities;
•trading and volume fluctuations;
•other risk factors as discussed herein; and
•other unforeseen eventsevents.


Stock markets in the U.S. have often experienced extreme price and volume fluctuations.fluctuations that are unrelated to the performance of any specific company or industry. Market fluctuations, as well as general political and economic conditions including acts of terrorism, military conflicts, outbreak of a contagious disease, prolonged economic uncertainty, a recession or interest rate or currency rate fluctuations, could adversely affect the market price of our stock.


We cannot provide assurance that we will continue to increasepay dividends, or if paid, that dividend payments and/or pay dividends. Inwill be consistent with historical levels.
We have generally paid quarterly dividends since fiscal 2011, our Board of Directors approved the commencement of a regular quarterly cash dividend on our common stock at an annual rate of $0.60 per share, subject to quarterly declaration. Since the initial commencement of a regular quarterly cash dividend, our Board of Directors has annually approved an increase to our cash dividend on our common stock. On March 7, 2018, our Board of

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Directors approved an increase to our quarterly cash dividend to $1.47 per share, subject to quarterly declaration. This dividend is anticipated to bewhich are funded through cash flow from operations, available cash on hand and borrowings under the revolver portion of the Eighth Amended and Restatedour Credit Agreement (“Vail Holdings Credit Agreement”). Although we anticipate paying regular quarterly dividends on our common stock for the foreseeable future, theFacilities. The declaration of dividends is subject to the discretion of our Board of Directors, and is limited by applicable state law concepts of available funds for distribution, as well as contractual restrictions. As a result, the amount, if any, of the dividends to be paid in the future will depend upon a number of factors, including our available cash on hand, anticipated cash needs, overall financial condition, restrictions contained in our senior credit facility, the VailEighth Amended and Restated Credit Agreement (the “Vail Holdings Credit Agreement,Agreement”), any future contractual restrictions, future prospects for earnings and cash flows, as well as other factors considered relevant by our Board of Directors. In addition, our Board of Directors may also suspend the payment of dividends at any time if it deems such action to be in the best interests of the Company and its stockholders. For example, on April 1, 2020, in response to actions taken in response to COVID-19, we announced that our Board of Directors suspended our quarterly dividend for at least two quarters, which such suspension continued throughout Fiscal 2021. Additionally, during the period that we are subject to the Financial Covenants Temporary Waiver Period (See “Risks Relating to Our Capital Structure—Restrictions imposed by the terms of our indebtedness may prevent or limit our future business plans.”), we are prohibited from paying any dividends or making share repurchases, unless (x) no default or potential default exists under the Vail Holdings Credit Agreement and (y) we have liquidity of at least $300.0 million, and the aggregate amount of dividends paid and share repurchases made by us during the Financial Covenants Temporary Waiver Period may not exceed $38.2 million in any fiscal quarter. If we do not pay dividends, the price of our common stock must appreciate for investors to realize a gain on their investment in Vail Resorts, Inc. This appreciation may not occur and our stock may in fact depreciate in value. On September 22, 2021, our Board of Directors approved a cash dividend of $0.88 per share payable on October 22, 2021 to stockholders of record as of October 5, 2021. Additionally, a Canadian dollar equivalent dividend on the Exchangeco Shares will be payable on October 22, 2021 to the shareholders of record as of October 5, 2021. We expect to fund the dividend with available cash on hand and will do so pursuant to the restrictions under the Financial Covenants Temporary Waiver Period.


Anti-takeover provisions affecting us could prevent or delay a change of control that is beneficial to our stockholders. Provisions of our certificate of incorporation and bylaws, provisions of our debt instruments and other agreements and provisions of applicable Delaware law and applicable federal and state regulations may discourage, delay or prevent a merger or other change of control that holders of our securities may consider favorable. These provisions could:

delay, defer or prevent a change in control of our Company;
discourage bids for our securities at a premium over the market price;
adversely affect the market price of, and the voting and other rights of the holders of our securities; or
impede the ability of the holders of our securities to change our management.

Our indebtedness could adversely affect our financial healthcondition and prevent usour ability to operate our business, to react to changes in the economy or our industry, to fulfill our obligations under our various notes, to pay our other debts, and could divert our cash flow from fulfilling our obligations. operations for debt payments.
We have a substantial amount of debt, which requires significant interest and principal payments. As of July 31, 2018,2021, we had $1,276.1 million of outstanding $2.9 billion in total indebtedness which includes $334.5 million for the Canyons Lease obligation.outstanding. This amount also consistsincludes (i) $575.0 million in aggregate principal amount of $684.40.0% convertible notes due 2026 (the “0.0% Convertible Notes”), (ii) $600.0 million aggregate principal amount of borrowings fromour unsecured senior notes issued on May 4, 2020 (the “6.25% Notes”), (iii) $1.1 billion of indebtedness pursuant to the term loan facility under the Vail Holdings Credit Agreement, used to pay the cash portion(iv) $44.9 million of the consideration and payment of associated fees and expenses of theindebtedness under our credit agreement at Whistler Blackcomb acquisition, $130.0(the “Whistler Credit Agreement”), (v) $351.8 million borrowingswith respect to our obligation associated with the Canyons long-term lease, (vi) $114.2 million with respect to the EPR Secured Notes under the revolver portion ofmaster credit and security agreements and other related agreements with EPT Ski Properties, Inc. and its affiliates (“EPR’’), as amended (collectively, the “EPR Agreements’’ and together with the Vail Holdings Credit Agreement and $65.4 million of borrowings underthe Whistler Blackcomb’s credit facility. In August 2018, we entered into our Eighth Amended and Restated Credit Agreement, the “Credit Agreements,’’ and increasedsuch facilities, the term loan facility by approximately $265.6“Credit Facilities’’) and (vii) $51.5 million of which $70.0 million was borrowed on August 15, 2018 in connection with respect to the closing ofEB-5 development notes under the Stevens Pass acquisition with the remainder borrowed on September 27, 2018 in connection with the closing of the Triple Peaks acquisition. U.S. EB-5 Program. Our borrowings under the Vail Holdings Credit Agreement are subject to interest rate changes substantially increasing our risk to changes in interest rates. Borrowings under the Vail Holdings Credit Agreement, including
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the term loan facility, currently bear interest annually at a rate of LIBOR plus 1.25% on an annual basis. Interest2.50% and, for amounts in excess of $400.0 million, LIBOR is subject to a floor of 0.25% (during the Financial Covenants Temporary Waiver Period, as defined below). Subsequent to the expiration of the Financial Covenants Temporary Waiver Period (as defined below), interest rate margins may fluctuate based upon the ratio of our Net Funded Debt to Adjusted EBITDA on a trailing four-quarter basis. We also have, on a cumulative basis, minimum lease payment obligations under operating leases of approximately $332.9$297.8 million as of July 31, 2018.2021. Our level of indebtedness and minimum lease payment obligations could have important consequences. For example, it could:


•make it more difficult for us to satisfy our obligations;obligations under our outstanding debt;
•increase our vulnerability to general adverse economic and industry conditions;
•require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness, including the annual payments under the Canyons lease, thereby reducing the availability of our cash flow to fund working capital, capital expenditures, real estate developments, marketing efforts and other general corporate purposes;
•limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;
•place us at a competitive disadvantage compared to our competitors that have less debt; and
•limit our ability to borrow additional funds.funds, refinance debt, or obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions or other general corporate purposes;

•make it difficult for us to satisfy our obligations, including debt service requirements under our outstanding debt; and
•cause potential or existing customers to not contract with us due to concerns over our ability to meet our financial obligations, such as insuring against our professional liability risks, under such contracts.

Furthermore, our debt under our Credit Facilities bears interest at variable rates, which may be impacted by potential future changes in interest rates due to reference rate reform. We may be able to incur substantial additional indebtedness in the future. The terms of our senior credit facilityCredit Facilities, the 0.0% Convertible Notes and the 6.25% Notes do not fully prohibit us from doing so. If we incur additional debt, the related risks that we face could intensify.


Restrictions imposed by the terms of our indebtedness may prevent or limit our futureus from capitalizing on business plans. opportunities.
The operating and financial restrictions and covenants in our credit agreementsCredit Facilities and the indenture governing the 6.25% Notes may adversely affect our ability to finance future operations or capital needs or to engage in other business activities and strategic initiatives that may be in our long-term best interests. For example, the credit agreements contain a number of restrictive covenants that

Our Credit Facilities impose significant operating and financial restrictions on us, includingus. These restrictions onlimit our ability and the ability of our subsidiaries to, among other things:


•incur or guarantee additional debt or sell preferredissue capital stock;

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•pay dividends repurchase our stock and make other restricted payments;distributions on, or redeem or repurchase, capital stock;
create liens;
•make certain types of investments;
engage in sales of assets and subsidiary stock;•incur certain liens;
enter into sales-leaseback transactions;
•enter into transactions with affiliates;
issue guarantees•merge or consolidate;
•enter into agreements that restrict the ability of debt;subsidiaries to make dividends, distributions or other payments to us or the guarantors;
•designate restricted subsidiaries as unrestricted subsidiaries; and
•transfer or sell assets.

On April 28, 2020 and most recently amended on December 18, 2020, we entered into an amendment to the Vail Holdings Credit Agreement, pursuant to which we are exempt from complying with the agreement’s maximum leverage ratio and minimum interest coverage ratio financial maintenance covenants for each of the fiscal quarters ending July 31, 2020 through January 31, 2022 (unless we make a one-time irrevocable election to terminate such exemption period prior to such date) (such period, the “Financial Covenants Temporary Waiver Period”), after which we will again be required to comply with such covenants starting with the fiscal quarter ending April 30, 2022 (or such earlier fiscal quarter as elected by us). Additionally, pursuant to this amendment, we are required to comply with a monthly minimum liquidity test (defined as unrestricted cash and temporary cash investments of Vail Resorts, Inc. and its restricted subsidiaries and available commitments under our revolving credit facility) of not less than $150.0 million until such date that Vail Holdings, Inc. delivers a compliance certificate for the Company and its subsidiaries’ first fiscal quarter following the end of the Financial Covenants Temporary Waiver Period.

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During the Financial Covenants Temporary Waiver Period, we are prohibited from taking the following actions (unless majority approval of the lenders is obtained under the Vail Holdings Credit Agreement):

•paying any dividends or making share repurchases, unless (x) no default or potential default exists under the Vail Holdings Credit Agreement and (y) the Company has liquidity of at least $300.0 million, and the aggregate amount of dividends paid and share repurchases made by the Company during the Financial Covenants Temporary Waiver Period may not exceed $38.2 million in any fiscal quarter;
•incurring any indebtedness secured by the collateral under the Vail Holdings Credit Agreement other than pursuant to the existing revolving commitments under the Vail Holdings Credit Agreement; and
•making certain non-ordinary course investments in similar businesses, joint ventures and unrestricted subsidiaries unless the Company has liquidity of at least $300.0 million.

The indenture governing the 6.25% Notes contains a number of significant restrictions and covenants that limit our ability to:
•grant or permit liens;
•engage in sale/leaseback transactions; and
•engage in a consolidation or merger, or sell, transfer or otherwise dispose of all or substantially all of our assets or enter into merger or consolidation transactions; andassets.
make capital expenditures.


In addition, therethe Whistler Credit Agreement contains restrictions on the ability of Whistler Mountain Resort Limited Partnership and Blackcomb Skiing Enterprises Limited Partnership (together “The WB Partnerships”) and their respective subsidiaries, and the EPR Agreements contain restrictions on the ability of Peak Resorts and its subsidiaries, to make dividends, distributions or other payments to us or the guarantors. We and our subsidiaries are subject to other covenants, representations and warranties in respect of our Credit Facilities, including financial covenants as defined in the Credit Agreements. Events beyond our control, including the impact of the ongoing COVID-19 pandemic, may affect our ability to comply with these covenants.

As a result of these restrictions, we will be limited as to how we conduct our business and we may be unable to raise additional debt or equity financing to compete effectively or to take advantage of new business opportunities. The terms of any future indebtedness we may incur could include more restrictive covenants. We may not be able to maintain compliance with our financial covenants in the future and, if we fail to do so, we may not be able to obtain waivers from the lenders and/or amend the covenants.

There can be no assurance that we will meet the financial covenants contained in our credit agreements.Credit Facilities, when in effect. If we breach any of these restrictions or covenants, or suffer a material adverse change which restricts our borrowing ability under our senior credit facility,Credit Facilities, we would not be able to borrow funds thereunder without a waiver. Any inability to borrow could have an adverse effect on our business, financial condition and results of operations. In addition, a breach, if uncured, could cause a default under the senior credit facility andapplicable agreement(s) governing our other debt. Our indebtedness, in which case such we may then become immediatelybe required to repay these borrowings before their due and payable.date. We may not have or be able to obtain sufficient funds to make these accelerated payments. If we are forced to refinance these borrowings on less favorable terms or cannot refinance these borrowings, our results of operations and financial condition could be adversely affected.


We cannot guarantee that we willmay not continue to repurchase our common stock pursuant to our share repurchase program, or that our share repurchase program willand any such repurchases may not enhance long-term stockholder value. Share repurchases could also increase the volatility of the price of our common stock and could diminish our cash reserves.reserves.
In March 2006, our Board of Directors approved a share repurchase program, authorizing the Company to repurchase up to 3,000,000 shares of common stock. In July 2008, the Board of Directors increased the authorization by an additional 3,000,000 shares, and in December 2015, the Board increased the authorization by an additional 1,500,000 shares for a total authorization to repurchase shares of up to 7,500,000 shares. Since inception of its share repurchase program through July 31, 2018,2021, the Company has repurchased 5,551,7166,161,141 shares at a cost of approximately $273.0$404.4 million. As of July 31, 2018, 1,948,2842021, 1,338,859 shares remained available to repurchase under the existing share repurchase program which has no expiration date.


Although our Board of Directors has approved a share repurchase program, the share repurchase program does not obligate us to repurchase any specific dollar amount or to acquire any specific number of shares. The timing and amount of repurchases, if any, will depend upon several factors, including market and business conditions, our liquidity and capital resources, the trading price of our common stock and the nature of other investment opportunities. The repurchase program may be limited, suspended or discontinued at any time without prior notice. In addition, repurchases of our common stock pursuant to our share repurchase program could cause our stock price to be higher than it would be in the absence of such a program and could potentially reduce the market liquidity for our stock. Additionally, our share repurchase program could diminish our cash reserves, which may impact our ability to finance future growth and to pursue possible future strategic opportunities and acquisitions. There can be no assurance that any share repurchases will enhance stockholder value because the market price of
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our common stock may decline below levels at which we repurchased shares of stock. Although our share repurchase program is intended to enhance long-term stockholder value, there is no assurance that it will do so and short-term stock price fluctuations could reduce the program’s effectiveness.


General Risk Factors

We are subject to litigation in the ordinary course of business.
We are, from time to time, subject to various asserted or unasserted legal proceedings and claims. Any such proceedings or claims, regardless of merit, could be time consuming and expensive to defend and could divert management’s attention and resources. While we believe we have adequate insurance coverage and/or accrue for loss contingencies for all known matters that are probable and can be reasonably estimated, we cannot provide any assurance that the outcome of all current or future litigation proceedings and claims will not have a material adverse effect on us and our results of operations.

We are subject to complex and evolving accounting regulations and use certain estimates and judgments that may differ significantly from actual results.
Implementation of existing and future legislation, rulings, standards and interpretations from the Financial Accounting Standards Board or other regulatory bodies could affect the presentation of our financial statements and related disclosures. Future regulatory requirements could significantly change our current accounting practices and disclosures. Such changes in the presentation of our financial statements and related disclosures could change an investor’s interpretation or perception of our financial position and results of operations.

We use many methods, estimates and judgments in applying our accounting policies (see “Critical Accounting Policies” in Item 7 of this Form 10-K). Such methods, estimates and judgments are, by their nature, subject to substantial risks, uncertainties and assumptions, and factors may arise over time that lead us to change our methods, estimates and judgments. Changes in those methods, estimates and judgments could significantly affect our results of operations.

Anti-takeover provisions affecting us could prevent or delay a change of control that is beneficial to our stockholders.
Provisions of our certificate of incorporation and bylaws, provisions of our debt instruments and other agreements and provisions of applicable Delaware law and applicable federal and state regulations may discourage, delay or prevent a merger or other change of control that holders of our securities may consider favorable. These provisions could:

•delay, defer or prevent a change in control of our Company;
•discourage bids for our securities at a premium over the market price;
•adversely affect the market price of, and the voting and other rights of the holders of our securities; or
•impede the ability of the holders of our securities to change our management.

ITEM 1B.UNRESOLVED STAFF COMMENTS.
ITEM 1B.UNRESOLVED STAFF COMMENTS.
None.


ITEM 2.PROPERTIES.
ITEM 2.PROPERTIES.
The following table sets forth the principal properties that we own or lease for use in our operations at fiscal year-end:
operations:
LocationOwnershipUse
Afton Alps, MNOwnedSki resort operations, including ski lifts, ski trails, clubhouse, buildings, commercial space and other improvements
Alpine Valley Resort, OHOwnedSki resort operations, including ski lifts, ski trails, golf course, clubhouse, buildings, commercial space and other improvements
Arrowhead Mountain, COOwnedSki resort operations, including ski lifts, ski trails, buildings and other improvements, property management and commercial space
Attitash Mountain, NH (279 acres)SUPSki trails, ski lifts, buildings and other improvements
BC Housing RiverEdge, CO26% OwnedEmployee housing facilities
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LocationOwnershipUse
Bachelor Gulch Village, COOwnedSki resort operations, including ski lifts, ski trails, buildings and other improvements, property management and commercial space

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LocationOwnershipUse
Beaver Creek Resort, COOwnedSki resort operations, including ski lifts, ski trails, buildings and other improvements, property management, commercial space and real estate held for sale or development
Beaver Creek Mountain, CO (3,849

acres)
SUPSki trails, ski lifts, buildings and other improvements
Beaver Creek Mountain Resort, COOwnedGolf course, clubhouse, commercial space and residential condominium units
Big Boulder Mountain, PAOwnedSki trails, ski lifts, buildings and other improvements
Boston Mills/Brandywine, OHOwnedSki trails, ski lifts, buildings and other improvements
Breckenridge Ski Resort, COOwnedSki resort operations, including ski lifts, ski trails, buildings and other improvements, property management, commercial space and real estate held for sale or development
Breckenridge Mountain, CO (5,702

acres)
SUPSki trails, ski lifts, buildings and other improvements
Breckenridge Terrace, CO50% OwnedEmployee housing facilities
Broomfield, COLeasedCorporate offices
Colter Bay Village, WYConcessionaire contractLodging and dining facilities
Eagle-Vail,Crested Butte Mountain Resort, COOwnedWarehouse facilityBuildings, other improvements and land used for operation of Crested Butte Mountain Resort
Edwards,Crested Butte Mountain Resort, CO (4,350 acres)LeasedSUPAdministrative officesSki trails, ski lifts, buildings and other improvements
DoubleTreeCrotched Mountain, NHOwnedSki trails, ski lifts, buildings and other improvements
Double Tree by Hilton Breckenridge, COOwnedLodging, dining and conference facilities
Eagle-Vail, COOwnedWarehouse facility
Edwards, COLeasedAdministrative offices
Falls Creek Alpine Resort, Victoria, Australia (1,112 acres)LeasedSki resort operations, including ski lifts, ski trails, buildings and other improvements
Headwaters Lodge & Cabins at Flagg Ranch, WYConcessionaire contractLodging and dining facilities
Heavenly Mountain Resort, CA & NVOwnedSki resort operations, including ski lifts, ski trails, buildings and other improvements and commercial space
Heavenly Mountain, CA & NV

(7,050 acres)
SUPSki trails, ski lifts, buildings and other improvements
Hidden Valley Resort, MO
OwnedSki trails, ski lifts, buildings and other improvements
Hotham Alpine Resort, Victoria, Australia (791 acres)LeasedSki resort operations, including ski lifts, ski trails, buildings and other improvements
Hotham Airport, Victoria, AustraliaOwnedRegional airport
Hunter Mountain, NYOwnedSki resort operations, including ski lifts, ski trails, golf course, clubhouse, buildings, commercial space and other improvements.
Jack Frost Ski Resort, PAOwnedSki trails, ski lifts, buildings and other improvements
Jackson Hole Golf & Tennis Club,

WY
OwnedGolf course, clubhouse, tennis and dining facilities
Jackson Lake Lodge, WYConcessionaire contractLodging, dining and conference facilities
Jenny Lake Lodge, WYConcessionaire contractLodging and dining facilities
Keystone Conference Center, COOwnedConference facility
Keystone Lodge, COOwnedLodging, spa, dining and conference facilities
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LocationOwnershipUse
Keystone Resort, COOwnedSki resort operations, including ski lifts, ski trails, buildings and other improvements, commercial space, property management, dining and real estate held for sale or development
Keystone Mountain, CO (8,376 acres)SUPSki trails, ski lifts, buildings and other improvements
Keystone Ranch, COOwnedGolf course, clubhouse and dining facilities
Kirkwood Mountain Resort, CAOwnedSki resort operations, including ski lifts, ski trails, buildings and other improvements, property management and commercial space
Kirkwood Mountain, CA (2,330 acres)SUPSki trails, ski lifts, buildings and other improvements
Mt. Brighton, MILiberty Mountain Resort, PAOwnedSki resort operations, including ski lifts, ski trails, golf course, clubhouse, buildings, and other improvements
Mad River Mountain, OHLeasedSki trails, ski lifts, buildings and other improvements
Mount Snow, VT (894 acres)SUPSki resort operations, including ski lifts, ski trails, golf course, clubhouse, buildings, commercial space and other improvementsimprovements.
Mount Sunapee Resort, NH (850 acres)
LeasedSki resort operations, including ski lifts, ski trails, buildings and other improvements and commercial space
Mt. Brighton, MIOwnedSki resort operations, including ski lifts, ski trails, buildings, commercial space and other improvements
Mt. Mansfield, VT (approximately 1,400 acres)LeasedSki trails, ski lifts, buildings and other improvements used for operation of Stowe Mountain Resort
Northstar California Resort, CA

(7,200 acres)
Leased(1)
Ski trails, ski lifts, golf course, commercial space, dining facilities, buildings and other improvements
Northstar Village, CA
Leased(1)
Commercial space, ski resort operations, dining facilities, buildings, property management and other improvements
Okemo Mountain Resort, VT
OwnedSki resort operations, including ski lifts, ski trails, buildings and other improvements, property management and commercial space
Okemo Mountain, VT (1,223 acres)LeasedSki resort operations, including ski lifts, ski trails, dining facilities, buildings and other improvements
Paoli Peaks, INOwned/LeasedSki trails, ski lifts, buildings and other improvements
Park City Mountain, UT

(8,900 acres)
Leased(2)
Ski resort operations including ski lifts, ski trails, buildings, commercial space, dining facilities, property management, conference facilities and other improvements (including areas previously referred to as Canyons Resort, UT)
Park City Mountain, UT

(220 acres)
OwnedSki trails, ski lifts, dining facilities, commercial space, buildings, real estate held for sale or development and other improvements

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LocationOwnershipUse
Perisher Ski Resort, NSW, Australia

(3,335 acres)
Owned/Leased/Licensed
Owned/Leased/Licensed (3)
Ski trails, ski lifts, dining facilities, commercial space, railway, buildings, lodging, conference facilities and other improvements
Red Cliffs Lodge, CALeasedDining facilities, ski resort operations, commercial space, administrative offices
Red Sky Ranch, COOwnedGolf courses, clubhouses, dining facilities and real estate held for sale or development
River Course at Keystone, COOwnedGolf course and clubhouse
Roundtop Mountain Resort, PAOwnedSki resort operations, including ski lifts, ski trails, buildings, commercial space and other improvements
Seasons at Avon, COLeased/50% OwnedAdministrative offices and commercial space
Snow Creek, MOOwnedSki trails, ski lifts, buildings and other improvements
SSI Venture, LLC (“VRR”) Properties; CO, CA, NV, UT, MN & BC, CanadaOwned/LeasedApproximately 260265 rental and retail stores (of which approximately 125120 stores are currently held under lease) for recreational products, and 65 leased warehouses
Ski Tip Lodge, COOwnedLodging and dining facilities
Mt. Mansfield, VT (approximately 1,400Stevens Pass, WAOwnedEmployee housing and guest parking facilities
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LocationOwnershipUse
Stevens Pass Mountain, WA (2,443 acres)LeasedSUPSki trails, ski lifts, buildings and other improvements used for operation of Stowe Mountain Resort
Stowe MountainStevens Pass Ski Resort, VTWAOwnedSki resort operations, including ski lifts, ski trails, buildings and other improvements and commercial space
Stowe Mountain Resort, VTOwnedSki resort operations, including ski lifts, ski trails, buildings and other improvements and commercial space
The Arrabelle at Vail Square, COOwnedLodging, spa, dining and conference facilities
The Lodge at Vail, COOwnedLodging, spa, dining and conference facilities
The Osprey at Beaver Creek, COOwnedLodging, dining and conference facilities
The Tarnes at Beaver Creek, CO31% OwnedEmployee housing facilities
Tenderfoot Housing, CO50% OwnedEmployee housing facilities
The Pines Lodge at Beaver Creek, COOwnedLodging, dining and conference facilities
The Village Hotel, Breckenridge, COOwnedLodging, dining, conference facilities and commercial space
Vail Mountain, COOwnedSki resort operations, including ski lifts, ski trails, buildings and other improvements, property management, commercial space and real estate held for sale or development
Vail Mountain, CO (12,353 acres)SUPSki trails, ski lifts, buildings and other improvements
Whistler Blackcomb Resort, BC, Canada75% OwnedSki resort operations, including ski lifts, ski trails, buildings and other improvements, property management, commercial space and real estate held for sale or development
Whistler Mountain and Blackcomb Mountain, BC, Canada
MDA(4)
Ski resort operations, including ski lifts, ski trails, buildings and other improvements
Whistler Blackcomb Resort, BC, CanadaLeasedEmployee housing facilities
WilmotWhitetail Resort, PAOwnedSki resort operations, including ski lifts, ski trails, golf course, buildings, commercial space and other improvements
Wildcat Mountain, WINHSUP/OwnedSki trails, ski lifts, buildings and other improvements
Wilmot Mountain, WIOwnedSki trails, ski lifts, buildings and other improvements


Many of our properties are used across all segments in complementary and interdependent ways.


(1)    The operations of Northstar are conducted on land and with operating assets owned by affiliates of EPR Properties under operating leases which were assumed by us. The leases provide for the payment of a minimum annual base rent with periodic increases in base rent over the lease term. In addition, the leases provide for the payment of percentage rent based on a percentage of gross revenues generated at the property over certain thresholds. The initial term of the leases expires in fiscal 2027, and is subject to three 10-year renewal options.

(2)    The operations of portions of Park City are conducted pursuant to a long-term lease on land and with certain operating assets owned by TCFC LeaseCo, LLC and TCFC PropCo, LLC. The lease provides for the payment of a minimum annual base rent with periodic increases in base rent over the lease term and participating contingent payments of a percentage of the amount by which EBITDA for resort operations exceeds certain thresholds, also subject to periodic increases over the lease term. The initial term of the lease expires in fiscal 2063 and is subject to six 50-year renewal options. Additionally, in connection with the lease, we entered into certain ancillary agreements with third parties, including leases and easements, allowing for various resort operations.


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(3)    The operations of Perisher are conducted pursuant to a long-term lease and license of land and certain improvements owned by the government of New South Wales within Kosciuszko National Park pursuant to the National Parks and Wildlife Act of 1974. 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 of a percentage of certain gross revenue, remittance of park user fees and certain other charges, also subject to periodic increases over the term. The initial term of the lease and license expires in 2048 and is subject to one 20-year renewal option.

(4)    Whistler Mountain and Blackcomb Mountain are located on Crown Land within the traditional territory of the Squamish and Lil’wat Nations. The relationship between Whistler Blackcomb and the Province is largely governed by MDAs between the Province and Whistler LP with respect to Whistler Mountain, and between the Province and Blackcomb LP with respect to Blackcomb Mountain.

ITEM 3.LEGAL PROCEEDINGS.

In May 2016, Kirkwood received a Notice of Violation (“NOV”) from the State of California Central Valley Regional Water Quality Control Board (the “Regional Water Board”) regarding the disposition of asphalt grindings used in parking lot surfacing in and around Kirkwood Creek.  We have cooperated with the Regional Water Board staff and the California Department of Fish and Wildlife (“CDFW”) to satisfactorily resolve the matters identified in the NOV.

On December 13, 2017, Kirkwood entered into a Settlement Agreement and Stipulation for Entry of Administrative Liability Order (“Stipulated Order”) with the Regional Water Board and CDFW.   Under the Stipulated Order, Kirkwood agreed to be responsible for monetary penalties and agency costs totaling approximately $0.8 million, of which approximately half will be fulfilled by a supplemental environmental project run by the National Fish and Wildlife Foundation.  All of these amounts have been paid by third-party insurance.  The remaining remediation work required by the Stipulated Order and requested by the agencies should be completed in calendar year 2018, depending on permits and weather conditions.

We do not expect the resolution of the above item to have a material impact on our results of operations or cash flows.

ITEM 3.LEGAL PROCEEDINGS.
We are a party to various lawsuits arising in the ordinary course of business. We believe that we have adequate insurance coverage and/or have accrued for all loss contingencies for asserted and unasserted matters and that, although the ultimate outcome of such claims cannot be ascertained, current pending and threatened claims are not expected, individually or in the aggregate, to have a material adverse impact on our financial position, results of operations and cash flows.


ITEM 4.MINE SAFETY DISCLOSURES.

ITEM 4.MINE SAFETY DISCLOSURES.
Not applicable.

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PART II


ITEM 5.MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.
ITEM 5.MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.
Market Information and Dividend PolicyStockholders
Our common stock is traded on the New York Stock Exchange (“NYSE”) under the symbol “MTN.” As of September 24, 2018, 40,475,51120, 2021, 40,391,129 shares of common stock were outstanding, held by approximately 280258 holders of record.
The following table sets forth information on the high and low sales prices of our common stock on the NYSE and the quarterly cash dividends declared per share of common stock for each quarterly period for the two most recently completed fiscal years.
 Quarter Ended    
Cash
Dividends
Declared
Per Share
 
 Market Price Per Share 
 High Low 
 Fiscal Year 2018     
 July 31, 2018$291.61
 $221.56
 $1.47
 April 30, 2018$236.23
 $200.68
 $1.47
 January 31, 2018$237.77
 $204.86
 $1.053
 October 31, 2017$232.71
 $209.80
 $1.053
 Fiscal Year 2017     
 July 31, 2017$215.82
 $197.11
 $1.053
 April 30, 2017$200.92
 $170.94
 $1.053
 January 31, 2017$172.32
 $153.66
 $0.81
 October 31, 2016$162.95
 $142.04
 $0.81

Dividend Policy
In fiscal 2011, our Board of Directors approved the commencement of a regular quarterly cash dividend on our common stock, at an annual rate of $0.60 per share, subject to quarterly declaration. Sincedeclaration, which has typically been increased on an annual basis. We announced on April 1, 2020 that we would be suspending the initial commencementdeclaration of a regular quarterly cash dividend, our Board of Directors has annually approved an increase to our cash dividend on our common stock and on March 7, 2018, our Board of Directors approved a 40% increase to our quarterly cash dividend in response to an annual ratethe impacts of $5.88 per share, subjectthe COVID-19 pandemic, which such suspension has continued throughout the year ended July 31, 2021 (“Fiscal 2021”). Additionally, pursuant to quarterly declaration. This dividend is anticipated to be funded through cash flow from operations, available cash on hand and borrowings under the revolver portionFourth Amendment of our Eighth Amended and Restated Credit Facility, dated as of August 15, 2018 (the “Amendedthe Vail Holdings Credit Agreement”). Subject toAgreement (as defined below), we are prohibited from paying any dividends during the discretionFinancial Covenants Temporary Waiver Period (as defined below) unless (x) no default or potential default exists under the Vail Holdings Credit Agreement and (y) the Company has liquidity (as defined below) of our Boardat least $300.0 million, and the aggregate amount of Directors, applicable lawdividends paid and contractual restrictions, we anticipate paying regular quarterly dividends on our common stock forshare repurchases made by the foreseeable future.Company during the Financial Covenants Temporary Waiver Period may not exceed $38.2 million in any fiscal quarter. The amount, if any, of the dividends to be paid in the future will depend uponon our available cash on hand, anticipated cash needs, overall financial condition, restrictions contained in the Amendedour Vail Holdings Credit Agreement, future prospects for earnings and cash flows, as well as other factors considered relevant by our Board of Directors. On September 22, 2021, our Board of Directors approved a cash dividend of $0.88 per share payable on October 22, 2021 to stockholders of record as of October 5, 2021. Additionally, a Canadian dollar equivalent dividend on the Exchangeco Shares will be payable on October 22, 2021 to the shareholders of record as of October 5, 2021. We expect to fund the dividend with available cash on hand and will do so pursuant to the restrictions under the Financial Covenants Temporary Waiver Period.
Repurchase of Equity Securities
The Company did not repurchase any shares of common stock during the fourth quarter of the year ended July 31, 2018 (“Fiscal 2018”).2021. The share repurchase program is conducted under authorizations made from time to time by our Board of Directors. On March 9, 2006, the Company’s Board of Directors approved a share repurchase program, authorizing the Company to repurchase up to 3,000,000 shares of common stock. On July 16, 2008, the Company’s Board of Directors increased the authorization by an additional 3,000,000 shares, and on December 4, 2015, the Company’s Board of Directors increased the authorization by an additional 1,500,000 shares for a total authorization to repurchase shares of up to 7,500,000 shares. Since inception of this stock repurchase program through July 31, 2018,2021, the Company has repurchased 5,551,7166,161,141 shares at a cost of approximately $273.0$404.4 million. As of July 31, 2018, 1,948,2842021, 1,338,859 shares remained available to repurchase under the existing repurchase authorization. Repurchases under these authorizations may be made from time to time at prevailing prices as permitted by applicable laws, and subject to market conditions and other factors. The timing as well as the number of Vail Shares that may be repurchased under the program will depend on several factors, including our future financial performance, our available cash resources and competing uses for cash that may arise in the future, the restrictions in our Vail Holdings Credit Agreement, prevailing prices of Vail Shares and the number of Vail Shares that become available for sale at prices that we believe are attractive. These authorizations have no expiration date.

Performance Graph
The total return graph below is presented for the period from the beginning of our fiscal year ended July 31, 20142017 through the end of Fiscal 2018.2021. The comparison assumes that $100 was invested at the beginning of the period in our common stock (“MTN”),

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The Russell 2000 Stock Index, The Standard & Poor’s 500 Stock Index and the Dow Jones U.S. Travel and Leisure Stock Index, with dividends reinvested where applicable. We include the Dow Jones U.S. Travel and Leisure Index as we believe we compete in the travel and leisure industry.

The performance graph is not deemed filed with the Securities and Exchange Commission (“SEC”) and is not to be incorporated by reference into any of our filings under the Securities Act of 1933 or the Exchange Act, unless such filings specifically incorporate the performance graph by reference therein.
a113.jpg
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mtn-20210731_g3.jpg
As of July 31,
201620172018201920202021
Vail Resorts, Inc.$100.00 $150.40 $201.87 $185.01 $147.98 $235.20 
Russell 2000$100.00 $118.43 $140.61 $134.34 $128.15 $194.71 
Standard & Poor’s 500$100.00 $116.03 $134.87 $145.63 $163.02 $222.40 
Dow Jones U.S. Travel and Leisure$100.00 $127.25 $134.84 $156.47 $119.00 $174.84 
ITEM 6.SELECTED FINANCIAL DATA.
ITEM 6.SELECTED FINANCIAL DATA.
The following table presents selected historical consolidated financial data derived from our Consolidated Financial Statements for the periods indicated. The financial data for our fiscal years ended and as of July 31, 20142017 through July 31, 20182021 should be read in conjunction with those Consolidated Financial Statements, related notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations. The table presented below is unaudited. The data presented below is in thousands, except for diluted net income per share attributable to Vail Resorts, Inc., cash dividends declared per share, effective ticket price (“ETP”), average daily rate (“ADR”) and revenue per available room (“RevPAR”) amounts.



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Year ended July 31,
  
2021 (1)(2)
2020 (1)(2)(3)
2019 (1)
2018 (1)
2017 (1)
Statement of Operations Data:
Total net revenue$1,909,710 $1,963,704 $2,271,575 $2,011,553 $1,907,218 
Total segment operating expense1,376,658 1,466,380 1,571,738 1,396,023 1,322,841 
Other operating expense, net(272,036)(273,935)(223,568)(206,713)(205,121)
Other expense, net(135,833)(106,956)(77,304)(68,725)(30,807)
Income before (provision) benefit from income taxes$125,183 $116,433 $398,965 $340,092 $348,449 
Net Income and Dividends:
Net income (4)
$124,457 $109,055 $323,493 $401,320 $231,718 
Net income attributable to Vail Resorts, Inc. (4)
$127,850 $98,833 $301,163 $379,898 $210,553 
Diluted net income per share attributable to Vail Resorts, Inc. (4)
$3.13 $2.42 $7.32 $9.13 $5.22 
Cash dividends declared per share$— $5.28 $6.46 $5.046 $3.726 
Other Segment Data:
Mountain
Skier visits (5)
14,852 13,483 14,998 12,345 12,047 
ETP (6)
$72.49 $67.72 $68.89 $71.31 $67.93 
Lodging
ADR (7)
$322.15 $310.76 $300.47 $300.90 $302.80 
RevPAR (8)
$85.99 $90.37 $121.81 $131.08 $127.95 
Real Estate
Real estate held for sale or investment (9)
$95,615 $96,844 $101,021 $99,385 $103,405 
Other Balance Sheet Data:
Cash and cash equivalents (10)
$1,243,962 $390,980 $108,850 $178,145 $117,389 
Total assets (11)
$6,251,056 $5,244,232 $4,426,077 $4,064,984 $4,110,718 
Long-term debt, net (including long-term debt due within one year)$2,850,292 $2,450,799 $1,576,260 $1,272,732 $1,272,421 
Net Debt (12)
$1,606,330 $2,059,819 $1,467,410 $1,094,587 $1,155,032 
Total Vail Resorts, Inc. stockholders’ equity$1,594,599 $1,316,742 $1,500,627 $1,589,434 $1,571,156 
(1)We have completed several acquisitions of destination mountain resorts and regional ski areas during the past five years, which impacts comparability between years, including Peak Resorts (acquired September 2019); Falls Creek and Hotham (acquired April 2019); Crested Butte, Mount Sunapee and Okemo (acquired September 2018); Stevens Pass (acquired August 2018); Stowe (acquired June 2017); and Whistler Blackcomb (acquired October 2016).
(2)Financial results for the years ended July 31, 2021 and 2020 were impacted by the deferral of approximately $120.9 million of season pass revenue, as well as approximately $2.9 million of related deferred costs, that would have been recognized during the year ended July 31, 2020 but were deferred and recognized primarily in the year ended July 31, 2021 as a result of credits that were offered to customers who had purchased 2019/2020 North American pass products and who purchased 2020/2021 North American pass products.
(3)Financial results for the year ended July 31, 2020 were impacted by an asset impairment of approximately $28.4 million as a result of the effects of the COVID-19 pandemic on our Colorado resort ground transportation company.
(4)Net income, net income attributable to Vail Resorts, Inc. and diluted net income per share attributable to Vail Resorts, Inc. were positively impacted during the year ended July 31, 2018 as a result of one-time tax benefits related to comprehensive U.S. tax legislation, which also resulted in a decreased federal U.S. corporate tax rate prospectively from January 1, 2018, and excess tax benefits from employee share award exercises, as discussed subsequently in this document.
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Year Ended July 31,
  
2018 (1)
 
2017 (1)
 
2016 (1)
 
2015 (1)
 
2014 (1)
Statement of Operations Data:         
          
Total net revenue$2,011,553
 $1,907,218
 $1,601,286
 $1,399,924
 $1,254,646
          
Total segment operating expense1,396,023
 1,322,841
 1,152,496
 1,058,432
 994,174
          
Other operating expense(206,713) (205,121) (165,811) (130,979) (143,209)
Other expense(68,725) (30,807) (40,360) (61,185) (73,191)
Income before benefit (provision) for income taxes$340,092
 $348,449
 $242,619
 $149,328
 $44,072
Net Income and Dividends:         
Net income (2)
$401,230
 $231,718
 $149,454
 $114,610
 $28,206
Net income attributable to Vail Resorts, Inc. (2)
$379,898
 $210,553
 $149,754
 $114,754
 $28,478
Diluted net income per share attributable to Vail Resorts, Inc. (2)
$9.13
 $5.22
 $4.01
 $3.07
 $0.77
Cash dividends declared per share$5.046
 $3.726
 $2.865
 $2.075
 $1.245
Other Data:         
Mountain         
Skier visits(3)
12,345
 12,047
 10,032
 8,466
 7,688
ETP (4)
$71.31
 $67.93
 $65.59
 $63.37
 $58.18
Lodging         
ADR(5)
$300.90
 $302.80
 $280.38
 $270.84
 $257.14
RevPAR(6)
$131.08
 $127.95
 $122.61
 $112.67
 $100.57
Real Estate         
Real estate held for sale and investment(7)
$99,385
 $103,405
 $111,088
 $129,825
 $157,858
Other Balance Sheet Data         
Cash and cash equivalents(8)
$178,145
 $117,389
 $67,897
 $35,459
 $44,406
Total assets (9)
$4,064,984
 $4,110,718
 $2,482,018
 $2,487,292
 $2,169,552
Long-term debt, net (including long-term debt due within one year)$1,272,732
 $1,272,421
 $700,263
 $814,501
 $622,325
Net Debt (10)
$1,094,587
 $1,155,032
 $632,366
 $779,042
 $577,919
Total Vail Resorts, Inc. stockholders’ equity$1,589,434
 $1,571,156
 $874,540
 $866,568
 $820,843

Notes to Selected Financial Data:
(1)We have made several mountain resort acquisitions during the past five years, which impacts comparability between years, including Stowe (acquired June 2017); Whistler Blackcomb (acquired in October 2016); Perisher (acquired in June 2015) and Park City Mountain Resort (acquired in September 2014).
(2)Net income and net income per share were positively impacted during the year ended July 31, 2018 as a result of comprehensive U.S. tax legislation and excess tax benefits from employee share award exercises, as discussed subsequently in this document.
(3)A skier visit represents a person purchasing a ticket or utilizing a pass to access a mountain resort or urban ski area for any part of one day during a winter ski season and includes complimentary access.
(4)ETP is calculated by dividing lift revenue by total skier visits during the respective periods.
(5)ADR is calculated by dividing total room revenue (includes both owned room and managed condominium unit revenue) by the number of occupied rooms during the respective periods.
(6)RevPAR is calculated by dividing total room revenue (includes both owned room and managed condominium unit revenue) by the number of rooms that are available to guests during the respective periods.
(7)Real estate held for sale and investment includes all land, development costs and other improvements associated with real estate held for sale and investment.
(8)Cash and cash equivalents exclude restricted cash.
(9)We adopted a new accounting pronouncement as of July 31, 2016, which requires that deferred tax assets and liabilities be classified as noncurrent on the balance sheet. This adoption was applied prospectively and, as such, prior periods have not been adjusted.

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(5)A skier visit represents a person purchasing a ticket or utilizing a pass to access a destination mountain resort or regional ski area for any part of one day during a winter ski season and includes complimentary access.
(10)Net Debt, a non-GAAP financial measure, is defined as long-term debt, net plus long-term debt due within one year less cash and cash equivalents. Refer to the end of the Results of Operations section of Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for a reconciliation of Net Debt to long-term debt, net.

(6)ETP is calculated by dividing lift revenue by total skier visits during the respective periods.
(7)ADR is calculated by dividing total room revenue (includes both owned room and managed condominium unit revenue) by the number of occupied rooms during the respective periods.
(8)RevPAR is calculated by dividing total room revenue (includes both owned room and managed condominium unit revenue) by the number of rooms that are available to guests during the respective periods.
(9)Real estate held for sale or investment includes all land, development costs and other improvements associated with real estate held for sale or investment.
(10)Cash and cash equivalents exclude restricted cash.
(11)We adopted a new lease accounting standard on August 1, 2019 using a modified retrospective transition method, in which reporting periods beginning on August 1, 2019 are presented under the new standard, while prior periods were not adjusted and continue to be reported in accordance with the previously applicable accounting guidance. As a result of adopting the new lease accounting standard, the Company recorded $221.8 million of right-of-use (“ROU”) assets and $254.2 million of related total operating lease liabilities in the Consolidated Balance Sheet as of August 1, 2019.
(12)Net Debt, a non-GAAP financial measure, is defined as long-term debt, net plus long-term debt due within one year less cash and cash equivalents. Refer to the end of the Results of Operations section of Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for a reconciliation of long-term debt, net to Net Debt.
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ITEM 7.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
ITEM 7.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) should be read in conjunction with the Consolidated Financial Statements and notes related thereto included in this Form 10-K. To the extent that the following MD&A contains statements which are not of a historical nature, such statements are forward-looking statements which involve risks and uncertainties. These risks include, but are not limited to, those discussed in Item 1A,1A. “Risk Factors” in this Form 10-K. The following discussion and analysis should be read in conjunction with the Forward-Looking Statements section and Item 1A,1A. “Risk Factors” each included in this Form 10-K.


The MD&A includes discussion of financial performance within each of our three segments. We have chosen to specifically include segment Reported EBITDA (defined as segment net revenue less segment operating expense, plus or minus segment equity investment income or loss and for the Real Estate segment, plus gain or loss on sale of real property) in the following discussion because we consider this measurement to be a significant indication of our financial performance. We utilize segment Reported EBITDA in evaluating our performance and in allocating resources to our segments. Net Debt (defined as long-term debt, net plus long-term debt due within one year less cash and cash equivalents), is included in the following discussion because we consider these measurementsthis measurement to be a significant indicationsindication of our financial performance and available capital resources. Resort Reported EBITDA, Total Reported EBITDA and Net Debt are not measures of financial performance or liquidity defined under generally accepted accounting principles (“GAAP”). We utilize Reported EBITDA in evaluating our performance and in allocating resources to our segments. We also believe that Net Debt is an important measurement as it is an indicator of our ability to obtain additional capital resources for our future cash needs. Resort Reported EBITDA (defined as the combination of segment Reported EBITDA of our Mountain and Lodging segments), Total Reported EBITDA (which is Resort Reported EBITDA plus segment Reported EBITDA from our Real Estate segment) and Net Debt are not measures of financial performance or liquidity defined under accounting principles generally accepted in the United States (“GAAP”). Refer to the end of the Results of Operations section for a reconciliation of Reported EBITDA to net income attributable to Vail Resorts, Inc. to Total Reported EBITDA and Net Debt to long-term debt, net.net to Net Debt.


Items excluded from Reported EBITDA and Net Debt are significant components in understanding and assessing financial performance or liquidity. Reported EBITDA and Net Debt should not be considered in isolation or as an alternative to, or substitute for, net income, net change in cash and cash equivalents or other financial statement data presented in the Consolidated Financial Statements as indicators of financial performance or liquidity. Because Resort Reported EBITDA, Total Reported EBITDA and Net Debt are not measurements determined in accordance with GAAP and are thus susceptible to varying calculations, Resort Reported EBITDA, Total Reported EBITDA and Net Debt, as presented herein, may not be comparable to other similarly titled measures of other companies. In addition, our segment Reported EBITDA (i.e. Mountain, Lodging and Real Estate), the measure of segment profit or loss required to be disclosed in accordance with GAAP, may not be comparable to other similarly titled measures of other companies.

Overview
Our operations are grouped into three integrated and interdependent segments: Mountain, Lodging and Real Estate. We refer to “Resort” as the combination of the Mountain and Lodging segments. The Mountain, Lodging and Real Estate segments represented approximately 85.6%89%, 14.2%11% and 0.2%0%, respectively, of our net revenue for Fiscal 2018.2021.




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Mountain Segment
TheIn the Mountain segment, as of July 31, 2018, was comprised of the operations of elevenCompany operates the following 37 destination mountain resorts and regional ski areas:
mtn-20210731_g2.jpg

*Denotes a destination mountain resort, properties and three urbanwhich generally receives a meaningful portion of skier visits from long-distance travelers, as opposed to our regional ski areas, including:which tend to generate skier visits predominantly from their respective local markets.
Mountain Resorts:Location:
1.Vail Mountain Resort (“Vail Mountain”)Colorado
2.Breckenridge Ski Resort (“Breckenridge”)Colorado
3.Keystone Resort (“Keystone”)Colorado
4.Beaver Creek Resort (“Beaver Creek”)Colorado
5.Park City Resort (“Park City”)Utah
6.Heavenly Mountain Resort (“Heavenly”)Lake Tahoe area of Nevada and California
7.Northstar Resort (“Northstar”)Lake Tahoe area of California
8.Kirkwood Mountain Resort (“Kirkwood”)Lake Tahoe area of California
9.Perisher Ski Resort (“Perisher”)New South Wales, Australia
10.Whistler Blackcomb Resort (“Whistler Blackcomb”)British Columbia, Canada
11.Stowe Mountain Resort (“Stowe”)Vermont
Urban Ski Areas (“Urban”):Location:
1.Wilmot Mountain (“Wilmot”)Wisconsin
2.Afton Alps Ski Area (“Afton Alps”)Minnesota
3.Mount Brighton Ski Area (“Mt. Brighton”)Michigan

Additionally, we operate ancillary services, primarily including ski school, dining and retail/rental operations, and for Perisher,our Australian ski areas, including lodging and transportation operations. Mountain segment revenue is seasonal, with the majority of revenue earned from our North American destination mountain resorts and Urbanregional ski areas (collectively, our “Resorts”) occurring in our second and third fiscal quarters and the majority of revenue earned from Perisherour Australian ski areas occurring in our first and fourth fiscal quarters. Our North American mountain resorts wereResorts are typically open for business for the 2017/2018 ski season primarily from mid-November through mid-April, which is the peak operating season for the Mountain segment.segment, and our Australian ski areas are typically open for business from June to early October. Our single largest source of Mountain segment revenue is the sale of lift tickets (including season passes)pass products), which represented approximately 51%64%, 51%53% and 50%53% of Mountain segment net revenue for Fiscal 2018,2021, the fiscal year ended July 31, 20172020 (“Fiscal 2017”2020”) and the fiscal year ended July 31, 20162019 (“Fiscal 2016”2019”), respectively.


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Lift revenue is driven by volume and pricing. Pricing is impacted by both absolute pricing, as well as the demographic mix of guests, which impacts the price points at which various products are purchased. The demographic mix of guests that visit our U.S.North American mountain resorts is divided into two primary categories: (1) out-of-state and international (“Destination”) guests and (2) in-state and local (“Local”) guests. For both the 2017/2018 and 2016/2017 U.S.2020/2021 North American ski seasons,season, Destination guests comprised approximately 61%52% of our U.S.North American destination mountain resort skier visits (excluding complimentary access), while Local guests comprised approximately 39% of our U.S. mountain resort skier visits,48%, which compares to approximately 58% and 42%, respectively, for the 2015/2016 U.S.2019/2020 North American ski season and approximately 57% and 43%, respectively, for the 2018/2019 North American ski season. Skier visitation at our regional ski areas is largely comprised of Local guests. Destination guests generally purchase our higher-priced lift ticket productstickets (including pass products) and utilize more ancillary services such as ski school, dining and retail/rental, as well as lodging at or around our mountain resorts. The impacts of COVID-19, including travel restrictions, had a disproportionately adverse impact on Destination visitation, particularly international guests, as demand for long-distance travel was lower than normal throughout the 2020/2021 North American ski season. Additionally, Destination guest visitation is less likely to be impacted by changes in the weather during the current ski season, but may be more impacted by adverse economic conditions, or the global geopolitical climate.climate or weather conditions in the immediately preceding ski season. Local guests tend to be more value-oriented and weather sensitive.


We offer a variety of season pass products for all of our mountain resorts and ski areas (collectively, “Resorts”),Resorts marketed towards both Destination and Local guests. Our season pass product offerings range from providing access to one or a combination of our Resorts for a certain number of days to our Epic Pass, which allows pass holders unlimited and unrestricted access to all of our ResortsResorts. 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 areas.a certain number of days during the season, and which is available in two tiers of resort access offerings. For the 2021/2022 North American ski season, we reduced prices of our entire portfolio of pass products by 20%. Our season pass program provides a compelling value proposition to our guests, which in turn assists us in developing a loyal base of customers who commit to ski at our Resorts generally in advance of the ski season and typically ski more days each season at our Resorts than those guests who do not buy season passes.pass products. Additionally, we have entered into strategic long-term season pass alliance agreements with third-party mountain resorts including Telluride Ski Resort and Arapahoe Basin in Colorado, Sun Valley Resort in Idaho, Snowbasin Resort in Utah, Hakuba Valley and Rusutsu Resort in Japan, and 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 season pass products. As such, our season pass program drives strong customer loyalty;loyalty, mitigates exposure to more weather sensitive guests;guests, generates additional ancillary spending;spending and provides cash flow in advance of winter season operations. In addition, our season pass program attracts new guests to our Resorts. All of our season pass products, including the Epic Pass and Epic Day Pass, are predominately sold prior to the start of the ski season. Season passPass product revenue, although primarily collected prior to the ski season, is recognized in the Consolidated Statements of Operations throughout the ski season (see Notesprimarily based on historical visitation (excluding visitation data for Fiscal 2020, which we do not believe is indicative of future visitation due to Consolidated Financial Statements)the early resort closures associated with COVID-19 in March 2020).


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Lift revenue consists of season pass product lift revenue (“pass revenue”) and non-season passnon-pass product lift revenue (“non-pass revenue”). Approximately 47%61%, 43%51% and 40%47% of total lift revenue was derived from pass revenue for Fiscal 2018,2021, Fiscal 20172020 and Fiscal 2016, respectively.2019, respectively (including the impact of the deferral of pass product revenue from Fiscal 2020 to Fiscal 2021 as a result of the Credit Offer, as defined below). Additionally, lift revenue for Fiscal 2021 was impacted by the Company only allowing pass product holders to access the Resorts during the early portion of the 2020/2021 North American ski season, as well as the Company utilizing a reservation system, which limited capacity for both pass product holders and non-pass lift tickets.


The cost structure of our mountain resort operations has a significant fixed component with variable expenses including, but not limited to, land use permit or lease fees, credit card fees, retail/rental cost of sales and labor, ski school labor and expenses associated with dining operations. As such, profit margins can fluctuate greatly based on the level of revenues associated with visitation.
Lodging Segment
Operations within the Lodging segment include (i) ownership/management of a group of luxury hotels through the RockResorts brand proximate to our Colorado and Utah mountain resorts; (ii) ownership/management of non-RockResorts branded hotels and condominiums proximate to our North American mountain resorts;Resorts; (iii) National Park Service (“NPS”) concessionaire properties including Grand Teton LodgingLodge Company (“GTLC”); (iv) a Colorado resort ground transportation company; and (v) mountain resort golf courses.


The performance of our lodging properties (including managed condominium units and our Colorado resort ground transportation company) proximate to our mountain resorts is closely aligned with the performance of the Mountain segment and generally experiences similar seasonal trends, particularly with respect to visitation by Destination guests. Revenues from
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such properties represented approximately 68%64%, 68%73% and 69%70% of Lodging segment net revenue (excluding Lodging segment revenue associated with reimbursement of payroll costs) for Fiscal 2018,2021, Fiscal 20172020 and Fiscal 2016,2019, respectively. Management primarily focuses on Lodging net revenue excluding payroll cost reimbursements and Lodging operating expense excluding reimbursed payroll costs (which are not measures of financial performance under GAAP) as the reimbursements are made based upon the costs incurred with no added margin; as such, the revenue and corresponding expense have no effect on our Lodging Reported EBITDA, which we use to evaluate Lodging segment performance. Revenue of the Lodging segment during our first and fourth fiscal quarters is generated primarily by the operations of our NPS concessionaire properties (as their operating season generally occurs from June to the end of September); mountain resort golf operations and seasonally lower volume from our other owned and managed properties and businesses.


Real Estate Segment
The principal activities of our Real Estate segment include the sale of land parcels to third-party developers and planning for future real estate development projects, including zoning and acquisition of applicable permits. We continue undertaking preliminary planning and design work on future projects and are pursuing opportunities with third-party developers rather than undertaking our own significant vertical development projects. Additionally, real estate development projects by third-party developers most often result in the creation of certain resort assets that provide additional benefit to the Mountain segment. We believe that, due to our low carrying cost of real estate land investments, we are well situated to promote future projects by third-party developers while limiting our financial risk. Our revenue from the Real Estate segment and associated expense can fluctuate significantly based upon the timing of closings and the type of real estate being sold, causing volatility in the Real Estate segment’s operating results from period to period.

Recent Trends, Risks and Uncertainties
We have identified the following significant factors (as well as uncertainties associated with such factors) that could impact our future financial performance:

•COVID-19 has led to travel restrictions and other adverse economic impacts including reduced consumer confidence, an increase in unemployment rates and volatility in global and local economies. Our operations continue to be negatively impacted by COVID-19 and associated government mandated restrictions, including capacity limitations, travel restrictions, and mask and social distancing requirements. Additionally, we may impose our own COVID-19 related restrictions in addition to what is required by state and local governments in the interest of safety for our guests, employees and resort communities. Although we are uncertain as to the ultimate severity and duration of the COVID-19 pandemic as well as the related global or other travel restrictions and other adverse impacts, we have seen a significant negative change in performance and our future performance could also be negatively impacted. In addition, the North American economy may be impacted by economic challenges in North America or declining or slowing growth in economies outside of North America, accompanied by devaluation of currencies, rising inflation, trade tariffs and lower commodity prices. We cannot predict the ultimate impact that the global economic uncertainty as a result of COVID-19 will have on overall travel and leisure spending or more specifically, on our guest visitation, guest spending or other related trends for the upcoming 2021/2022 North American ski season.

•In the prior year, we announced the early closure of the 2019/2020 North American ski season for our Resorts, lodging properties and retail stores beginning on March 15, 2020. These actions (the “Resort Closures”) had a significant adverse impact on our results of operations for the year ended July 31, 2020. Additionally, on April 27, 2020, we announced that we would offer credits to customers who had purchased 2019/2020 North American pass products and who purchased 2020/2021 North American pass products on or before September 17, 2020 (the “Credit Offer”). The Credit Offer discounts ranged 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. As a result of the Credit Offer to 2019/2020 pass product holders, we delayed the recognition of approximately $120.9 million of season pass deferred revenue, as well as approximately $2.9 million of related deferred costs, that would have been recognized in Fiscal 2020 and which was instead primarily recognized in the second and third quarters of Fiscal 2021.

•The ongoing impacts of the COVID-19 pandemic resulted in reduced visitation and decreased spending for the 2020/2021 North American ski season compared to the prior year through March 14, 2021, the equivalent date that we closed our Resorts early for the 2019/2020 North American ski season due to the outbreak of COVID-19. These declines were primarily driven by reduced demand for Destination visitation at our western resorts and COVID-19 related capacity limitations, which were further impacted by snowfall levels that were well below average at our Colorado, Utah and Tahoe resorts from the early season throughout the holiday season. Visitation and spending was also particularly
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impacted in regions where heightened COVID-19 restrictions were in place, including Whistler Blackcomb, Tahoe and Vermont. However, results continued to improve as the season progressed, primarily as a result of stronger Destination visitation at our Colorado and Utah resorts, including improved lift ticket purchases. Whistler Blackcomb’s results were disproportionately impacted as compared to our broader Mountain segment as a result of the Canadian travel restrictions and border closures, and were further impacted by the early closure of Whistler Blackcomb on March 30, 2021 following a provincial health order issued by the government of British Columbia due to an increase in COVID-19 cases in the region. Our Fiscal 2021 first quarter results were negatively impacted by Mount Hotham and Falls Creek, which opened for the 2020 Australian ski 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. Additionally, our Australian ski areas were also impacted by “stay at home” orders and periodic resort closures during the 2021 ski season, which had a negative impact on our Fiscal 2021 fourth quarter results. The ongoing impacts of COVID-19 also resulted in reduced occupancy at our lodging properties during the 2019/2020 North American ski season following our early closure in March 2020, as well as during the 2020/2021 North American ski season. We closed our GTLC facilities including Jackson Lake Lodge and Jenny Lake Lodge during the summer of 2020, implemented restrictions on guided activities and in-restaurant dining, and temporarily closed many other facilities, which negatively impacted results for the first quarter of Fiscal 2021. These actions, trends, and the COVID-19 pandemic in general, had a significant adverse impact on our results of operations for the Fiscal 2020 and Fiscal 2021, and may continue to have a material, negative impact on our resorts and lodging properties for the fiscal year ending July 31, 2022 (“Fiscal 2022”).

•The timing and amount of snowfall can have an impact on Mountain and Lodging revenue, particularly with regard to skier visits and the duration and frequency of guest visitation. To help mitigate this impact, we sell a variety of pass products prior to the beginning of the ski season resultingwhich results in a more stabilized stream of lift revenue. In March 2018,2021, we began our pre-season pass product sales program for the 2018/2019 North American ski season. Through September 23, 2018,2021/2022 North American ski season, which included a 20% reduction in price for all pass products. Pass product sales through September 17, 2021 for the upcoming 2021/2022 North American ski season increased approximately 25%42% in units and 15%approximately 17% in sales dollars as compared to the period in the prior year through September 24, 2017, including all military18, 2020, without deducting for the value of any redeemed credits provided to certain North American pass product holders in the prior period. To provide a comparison to the season pass results released on June 7, 2021, pass product sales through September 17, 2021 increased approximately 67% in units and approximately 45% in sales dollars as compared to the period through September 20, 2019, with pass product sales adjusted to include Peak Resorts pass sales in both periods and excluding passperiods. Pass product sales from Stevens Pass and Triple Peaks in both periods andare adjusted to eliminate the impact of foreign currency by applying current periodan exchange rates torate of $0.79 between the prior periodCanadian dollar and U.S. dollar in all periods for Whistler Blackcomb pass sales. Growth in our total season pass sales dollars was lower than our unit growth, given the inclusion of the new Military Epic Pass, which is available at a substantial discount to our Epic Pass. The average price increase on all non-military passes was approximately 4.5%. Excluding sales of military passes to new purchasers who were not pass holders last year, season pass sales increased approximately 9% in units and 12% in sales dollars over the comparable period in 2017.Blackcomb. We cannot predict if this favorable trend will continue for the entire duration ofthrough the fall 20182021 North American pass sales campaign

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nor can we predict or the overall impact that season pass sales will have on lift revenue for the 2018/20192021/2022 North American ski season.


In Fiscal 2018, our lift revenue was favorably impacted by non-pass price increases at our mountain resorts that were implemented for•Prior to the 2017/2018 North American ski season. Non-pass prices for the 2018/20192020/2021 North American ski season, have not yet been finalized;we introduced Epic Coverage, which is included with the purchase of all pass products for no additional charge. Epic Coverage provides refunds in the event of certain resort closures and as such, there can be no assurances as tocertain qualifying travel restrictions (e.g. for COVID-19), giving pass product holders a refund for any portion of the level of price increases, if any, which will occur and the impactseason that pricing may have on visitation or revenue.

Our Fiscal 2018 results for our Mountain segment showed improvement over Fiscal 2017 largelyis lost due to strongqualifying circumstances. Additionally, Epic Coverage provides a refund for qualifying personal circumstances that were historically covered by our pass sales growthinsurance program, including for eligible injuries, job losses and many other personal events. The estimated amount of refunds reduces the amount of pass product revenue recognized. We believe our estimate of refund amounts are reasonable; however, actual results could vary materially from such estimates, and we could be required to refund significantly higher amounts than estimated.

Additionally, for the 2017/20182020/2021 North American ski season, the incremental operationswe introduced Epic Mountain Rewards, a program which provides pass product holders a discount of Stowe (acquired in June 2017)20% off on-mountain food and excellent conditionsbeverage, lodging, group ski school lessons, equipment rentals and more at Whistler Blackcomb throughout most of the season. However, we experienced historically low snowfall levels across our western U.S. resorts for the first half of the 2017/2018 North American ski season, including the key Christmas holiday period, which hadowned and operated Resorts. Epic Mountain Rewards constitutes an adverse impact on skier visitationoption to our guests to purchase additional products and our results of operations. We cannot predict whether our resorts will experience normal snowfall conditions for the upcoming 2018/2019 North American ski season nor can we estimate the impact there may be to advance bookings, guest travel, season pass sales, lift revenue (excluding season passes), retail/rental sales or other ancillary services revenue next ski seasonfrom us at a discount and as a result, of past snowfall conditions.

Key North American economic indicators have remained steady into 2018, including strong consumer confidence and declines in the unemployment rate. However, the growth in the North American economy may be impacted by economic challenges in North America or declining or slowing growth in economies outside of North America, accompanied by devaluation of currencies, rising inflation, trade tariffs and lower commodity prices. Given these economic uncertainties, we cannot predict what the impact will be on overall travel and leisure spending or more specifically, on our guest visitation, guest spending or other related trends for the upcoming 2018/2019 North American ski season.

On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act transitions the U.S. tax system toallocate a new territorial system and lowers the statutory federal corporate income tax rate from 35% to 21%. The reductionportion of the statutory federal corporate tax ratepass product transaction price to 21% became effective on January 1, 2018. In Fiscal 2018, our U.S. blended federal statutory income tax rate was approximately 27% (August 2017 through December 2017 at 35% and January 2018 through July 2018 at 21%), which will be reduced to 21% in the year ending July 31, 2019 and thereafter. As a resultthese other lines of the Tax Act, we recorded a one-time, provisional net tax benefit of approximately $61.0 million on our Consolidated Statement of Operations during Fiscal 2018. Due to the reduction in the federal corporate tax rate, we remeasured our U.S. net deferred tax liabilities as of the effective date of the Tax Act. The U.S. net deferred tax liabilities remeasurement resulted in a one-time tax benefit estimated to be approximately $67.0 million, which was recorded during Fiscal 2018. Also, in transitioning to the new territorial tax system, the Tax Act requires us to include certain foreign earnings of non-U.S. subsidiaries in our Fiscal 2018 taxable income. Such foreign earnings are subject to a one-time tax referred to as the “Transition Tax,” which was estimated to be $6.0 million, and was recorded during Fiscal 2018. The above-mentioned accounting impacts of the deferred tax remeasurement and Transition Tax are provisional, based on currently available information and technical guidance on the interpretation of the new law. The provisional accounting impacts may change in future reporting periods until the accounting analysis is finalized, which will occur no later than December 22, 2018, as permitted by the SEC. For further discussion related to the Tax Act see “Other Items” within MD&A and Notes to Consolidated Financial Statements.business.


•As of July 31, 2018,2021, we had $178.1$1,244.0 million inof cash and cash equivalents as well as $185.1$417.7 million available under the revolver component of the Vailour Eighth Amended and Restated Credit Agreement, dated as of August 15, 2018 and as amended most recently on December 18, 2020 (the “Vail Holdings Credit Agreement (whichAgreement”), which represents the total commitment of $400.0$500.0 million less outstanding borrowings of $130.0 million and certain letters of credit outstanding of $84.9 million).$82.3 million. Additionally, we have a credit facility which supports the liquidity needs of Whistler Blackcomb (the “Whistler Credit Agreement”). As of July 31, 20182021, we had C$214.1243.1 million ($164.6194.9 million) available under the revolver component of the Whistler Credit
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Agreement (which represents the total commitment of C$300.0 million ($230.7240.5 million) less outstanding borrowings of C$85.056.0 million ($65.444.9 million) and a letter of credit outstanding of C$0.9 million ($0.7 million)).
On August 15, 2018,December 18, 2020, we further amendedentered into the Fourth Amendment to our Vail Holdings Credit Agreement dated May 1, 2015, in(the “Fourth Amendment”). Pursuant to the form of an Eighth Amended and Restated Credit Agreement (the “AmendedFourth Amendment, among other terms, we are exempt from complying with the Vail Holdings Credit Agreement”) to provideAgreement’s leverage ratio, senior secured leverage ratio, and interest coverage ratio financial maintenance covenants for an incremental term loan of $265.6 million, increasing the capacityeach of the term loanfiscal quarters ending through January 31, 2022 (unless we make a one-time irrevocable election to $950.0 million,terminate such exemption prior to fundsuch date) (such period, the acquisitions of Stevens Pass and Triple Peaks,“Financial Covenants Temporary Waiver Period”), after which we will again be required to comply with such covenants starting with the fiscal quarter ending April 30, 2022 (or such earlier fiscal quarter as discussed and defined below.

We believe thatelected by us). During the terms of our Amended Vail Holdings Credit Agreement and Whistler Credit Agreement allow for sufficient flexibility inFinancial Covenants Temporary Waiver Period, we are subject to other restrictions which will limit our ability to make future acquisitions, investments, distributions to stockholders, andshare repurchases or incur additional debt. This, combined withAdditionally, on December 18, 2020, we completed an offering of $575.0 million in aggregate principal amount of 0.0% convertible senior notes due 2026 (the “0.0% Convertible Notes”) in a private placement conducted pursuant to Rule 144A under the continuedSecurities Act of 1933, as amended (the “Securities Act”). The 0.0% Convertible Notes are senior, unsecured obligations that do not bear regular interest, and the principal amount of the 0.00% Convertible Notes does not accrete. The notes will mature on January 1, 2026, unless earlier repurchased, redeemed or converted. See Liquidity and Capital Resources for additional information.
We believe that our existing cash and cash equivalents, availability under our credit agreements and the expected positive cash flow from operating activities of our Mountain and

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Lodging segments less resort capital expenditures has and is anticipated towill continue to provide us with significant liquidity. We believe oursufficient liquidity will allow us to consider strategic investments and other forms of returning value to our stockholders including additional share repurchases and the continued payment of a quarterly cash dividend.

On August 15, 2018, through a wholly-owned subsidiary, we acquired Stevens Pass Resort in the State of Washington (“Stevens Pass”) from Ski Resort Holdings, LLC for a total purchase price of $64.0 million. We borrowed $70.0 million on August 15, 2018 under the term loan of our Amended Vail Holdings Credit Agreement, as discussed above, primarily to fund the acquisition of Stevens Pass. Additionally, on September 27, 2018, we acquired Triple Peaks, LLC (“Triple Peaks”), the parent company of Okemo Mountain Resort in Vermont (“Okemo”), Crested Butte Mountain Resort in Colorado (“Crested Butte”), and Mount Sunapee Resort in New Hampshire (“Mount Sunapee”), for a cash purchase price of approximately $74.0 million, after adjustments for certain agreed-upon terms. In addition, at closing, Triple Peaks paid $155.0 million to pay off the leases that all three resorts had with Ski Resort Holdings, LLC, an affiliate of Oz Real Estate, with funds provided by the Company. We borrowed the remainder of the term loan increase, as discussed above, to fund the acquisition. Additionally, we obtained a new Special Use Permit from the U.S. Forest Service for Crested Butte, and assumed the state land leases for Okemo and Mount Sunapee. We expect that the acquisitions of Stevens Pass and Triple Peaks will positively contribute to our results of operations; however, we cannot predict whether we will realize all of the synergies expected from the operations of Stevens Pass and Triple Peaks and the ultimate impact the new resorts will have on our future results of operations.



Results of Operations
Summary
Shown below is a summary of operating results for Fiscal 2018,2021, Fiscal 20172020 and Fiscal 20162019 (in thousands):

 Year ended July 31,
  
202120202019
Net income attributable to Vail Resorts, Inc.$127,850 $98,833 $301,163 
Income before provision for income taxes$125,183 $116,433 $398,965 
Mountain Reported EBITDA$550,389 $500,080 $678,594 
Lodging Reported EBITDA(5,733)3,269 28,100 
Resort Reported EBITDA$544,656 $503,349 $706,694 
Real Estate Reported EBITDA$(4,582)$(4,128)$(4,317)
 Year Ended July 31,
  
2018 2017 2016
Mountain Reported EBITDA$591,605
 $566,338
 $424,415
Lodging Reported EBITDA25,006
 27,087
 28,169
Resort Reported EBITDA$616,611
 $593,425
 $452,584
Real Estate Reported EBITDA$957
 $(399) $2,784
Income before benefit (provision) for income taxes$340,092
 $348,449
 $242,619
Net income attributable to Vail Resorts, Inc.$379,898
 $210,553
 $149,754


A discussion of segment results, including reconciliations of segment Reported EBITDA to net income attributable to Vail Resorts, Inc., to Total Reported EBITDA, and other items can be found below. The consolidated results of operations, including any consolidated financial metrics pertaining thereto, include the operations of Peak Resorts (acquired September 24, 2019), Falls Creek and Hotham (acquired April 4, 2019), Triple Peaks (acquired September 27, 2018) and Stevens Pass (acquired August 15, 2018), prospectively from their respective dates of acquisition.


The Resort Closures had a significant adverse impact on our results of operations for Fiscal 2020. Additionally, COVID-19 continued to have an adverse impact on our results of operations for Fiscal 2021, as further described below in our segment results of operations.

The sections titled “Fiscal 20182021 compared to Fiscal 2017”2020” and “Fiscal 20172020 compared to Fiscal 2016”2019” in each of the Mountain and Lodging segment discussions below provide comparisons of financial and operating performance for Fiscal 20182021 to Fiscal 20172020 and Fiscal 20172020 to Fiscal 2016,2019, respectively, unless otherwise noted.

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Mountain Segment
Mountain segment operating results for Fiscal 2018,2021, Fiscal 20172020 and Fiscal 20162019 are presented by category as follows (in thousands, except ETP):
    Percentage
 Year ended July 31,Increase/(Decrease)
  2021202020192021/20202020/2019
Mountain net revenue:
Lift$1,076,578 $913,091 $1,033,234 17.9 %(11.6)%
Ski school144,227 189,131 215,060 (23.7)%(12.1)%
Dining90,329 160,763 181,837 (43.8)%(11.6)%
Retail/rental227,993 270,299 320,267 (15.7)%(15.6)%
Other150,751 177,159 205,803 (14.9)%(13.9)%
Total Mountain net revenue1,689,878 1,710,443 1,956,201 (1.2)%(12.6)%
Mountain operating expense:
Labor and labor-related benefits452,352 473,365 507,811 (4.4)%(6.8)%
Retail cost of sales76,565 96,497 121,442 (20.7)%(20.5)%
Resort related fees69,768 75,044 96,240 (7.0)%(22.0)%
General and administrative253,279 239,412 233,159 5.8 %2.7 %
Other294,223 327,735 320,915 (10.2)%2.1 %
Total Mountain operating expense1,146,187 1,212,053 1,279,567 (5.4)%(5.3)%
Mountain equity investment income, net6,698 1,690 1,960 296.3 %(13.8)%
Mountain Reported EBITDA$550,389 $500,080 $678,594 10.1 %(26.3)%
Total skier visits14,852 13,483 14,998 10.2 %(10.1)%
ETP$72.49 $67.72 $68.89 7.0 %(1.7)%
       Percentage
 Year Ended July 31, Increase/(Decrease)
  
2018 2017 2016 2018/2017 2017/2016
Mountain net revenue:         
Lift$880,293
 $818,341
 $658,047
 7.6 % 24.4%
Ski school189,910
 177,748
 143,249
 6.8 % 24.1%
Dining161,402
 150,587
 121,008
 7.2 % 24.4%
Retail/rental296,466
 293,428
 241,134
 1.0 % 21.7%
Other194,851
 171,682
 141,166
 13.5 % 21.6%
Total Mountain net revenue1,722,922
 1,611,786
 1,304,604
 6.9 % 23.5%
          
Mountain operating expense:         
Labor and labor-related benefits443,891
 403,020
 338,250
 10.1 % 19.1%
Retail cost of sales111,198
 112,902
 93,946
 (1.5)% 20.2%
Resort related fees87,111
 83,503
 68,890
 4.3 % 21.2%
General and administrative214,090
 199,582
 173,640
 7.3 % 14.9%
Other276,550
 248,324
 206,746
 11.4 % 20.1%
Total Mountain operating expense1,132,840
 1,047,331
 881,472
 8.2 % 18.8%
Mountain equity investment income, net1,523
 1,883
 1,283
 (19.1)% 46.8%
Mountain Reported EBITDA$591,605
 $566,338
 $424,415
 4.5 % 33.4%
Total skier visits12,345
 12,047
 10,032
 2.5 % 20.1%
ETP$71.31
 $67.93
 $65.59
 5.0 % 3.6%


Mountain Reported EBITDA includes $15.7$20.3 million, $15.0$17.4 million and $13.4$16.5 million of stock-based compensation expense for Fiscal 2018,2021, Fiscal 20172020 and Fiscal 2016,2019, respectively.


Fiscal 20182021 compared to Fiscal 20172020
TheMountain Reported EBITDA increased $50.3 million, or 10.1%, primarily due to the impact of the prior year Resort Closures, including the deferral of $120.9 million of pass product revenue from Fiscal 2020 to Fiscal 2021 as a result of the Credit Offer to 2019/2020 North American pass product holders, as well as cost discipline efforts in the current year associated with lower levels of operations. These increases were partially offset by limitations and restrictions on our North American winter operations and closures, limitations and restrictions at Perisher, Falls Creek and Hotham during both the 2020 and 2021 Australian ski seasons. Additionally, Whistler Blackcomb’s performance was negatively impacted in the current year due to the continued closure of the Canadian border to international guests and was further impacted by the resort closing earlier than expected on March 30, 2021 following a provincial health order issued by the government of British Columbia. Mountain segment results reflectalso include $1.0 million and $13.6 million of acquisition and integration related expenses for Fiscal 2021 and Fiscal 2020, respectively, which are recorded within Mountain other operating expense. Additionally, operating results from Whistler Blackcomb, which are translated from Canadian dollars to U.S. dollars, were favorably affected by increases in the Canadian dollar exchange rate relative to the U.S. dollar as compared to the prior year, resulting in an increase in Mountain Reported EBITDA of $25.3approximately $2 million, which the Company calculated by applying current period foreign exchange rates to the prior period results.

Lift revenue increased $163.5 million, or 4.5%17.9%, primarily due to the Company operating for the full U.S. ski season in the current year as compared to the shortened operating season in the prior year as a result of the Resort Closures, including the deferral impact of the Credit Offer from Fiscal 2020 to Fiscal 2021, partially offset by limitations and restrictions on our North American winter operations in the current year due to the ongoing impacts of COVID-19, which resulted in a decrease in non-pass visitation. Pass product revenue increased 40.6%, primarily as a result of strong North American pass sales growth for the 2017/20182020/2021 ski season, including the deferral impact of the Credit Offer which was recognized primarily during Fiscal 2021. Non-pass revenue decreased 5.7% due to reduced non-pass visitation to our Resorts, which were adversely impacted by COVID-19 related capacity limitations and snowfall levels that were well below average at our Colorado, Utah and Tahoe
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resorts through the holiday season, partially offset by an increase in non-pass ETP of 10.1% in the current year. Visitation was particularly impacted in regions where heightened COVID-19 related restrictions were in place, including Whistler Blackcomb, Tahoe and Vermont. Additionally, Whistler Blackcomb’s results were disproportionately impacted as compared to our broader Mountain segment performance in the current year due to the continued closure of the Canadian border to international guests, and was further impacted by the resort closing earlier than expected on March 30, 2021 following a provincial health order issued by the government of British Columbia.

Ski school revenue, dining revenue and retail/rental revenue each decreased in Fiscal 2021 compared to Fiscal 2020 primarily due to the limitations and restrictions on our North American ski season and the incremental operations of Stowe (acquired in June 2017). Our results across all lines of business at our western U.S. resorts during Fiscal 2018 were impacted by challenging ski conditions2021 as a result of historically low snowfall for the first halfimpacts of the 2017/2018 ski season, although conditions progressively improved during the third quarter of Fiscal 2018. Total skier visitation increased 2.5%, which was primarily the result of incremental skier visitation at Stowe and an increase in skier visitation at Whistler Blackcomb and Perisher, partially offset by lower skier visitation toCOVID-19 on our western U.S. resorts. The Fiscal 2018 and Fiscal 2017 results include $10.2 million and $10.8 million of acquisition and integration related expenses, respectively.business.

Lift revenue increased $62.0 million, or 7.6%, primarily due to an increase in pass revenue and incremental revenue from Stowe. Pass revenue increased 17.7%, which was driven by a combination of an increase in both pricing and units sold, which was favorably impacted by increased pass sales to Destination guests. Non-pass revenue was flat, which was primarily the result of incremental non-pass revenue from Stowe and an increase in non-pass revenue from Whistler Blackcomb, as well as an increase in ETP excluding season pass holders of 2.4%, offset by a decrease in non-pass skier visitation at our western U.S. resorts. Total ETP increased $3.38, or 5.0%, primarily due to price increases in both our lift ticket products and season pass products and slightly lower average visitation by season pass holders during the 2017/2018 North American ski season as compared with the 2016/2017 North American ski season.

Ski school revenue increased $12.2 million, or 6.8%, primarily as a result of increased revenue at Whistler Blackcomb and Park City, as well as incremental revenue from Stowe. Dining revenue increased $10.8 million, or 7.2%, primarily as a result of incremental revenue from Stowe and increased revenue from Whistler Blackcomb, reflecting a full year of operations as compared to Fiscal 2017, which included operations from the date of acquisition, October 17, 2016, through July 31, 2017. However, these increases were partially offset by lower revenue at our western U.S. resorts, which experienced delays in the opening of certain

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on-mountain dining venues as a result of challenging weather conditions for the first half of the 2017/2018 North American ski season.

Retail/rental revenue increased $3.0 million, or 1.0%, of which rental revenue increased $2.9 million, or 3.2%, and retail revenue was relatively flat. Both rental and retail revenue were positively impacted by an increase in revenue at Whistler Blackcomb and incremental revenue from Stowe, partially offset by decreased revenue at stores proximate to our western U.S. resorts and other city stores.


Other revenue mainly consists of summer visitation and mountain activities revenue, employee housing revenue, guest services revenue, commercial leasing revenue, marketing and internet advertising revenue, private club revenue (which includes both club dues and amortization of initiation fees), municipal services revenue and other recreation activity revenue. Other revenue is also comprised of PerisherAustralian ski area lodging and transportation revenue. For Fiscal 2018,2021, other revenue increased $23.2decreased $26.4 million, or 13.5%14.9%, primarily attributabledue to incremental summerdecreased mountain activities and eventsmountain services revenue at Whistler Blackcombas a result of limitations and restrictions on our business in Fiscal 2021 due to COVID-19, as well as a reduction in ski pass insurance revenue as a result of the inclusionreplacement of Stowe operations.our previous ski pass insurance program with Epic Coverage for the 2020/2021 North American ski season, which is free to all pass product holders.


Operating expense for Fiscal 2018 increased $85.5decreased $65.9 million, or 8.2%5.4%, which was primarily attributable to cost discipline efforts in the inclusioncurrent year associated with lower levels of Stowe operations and incrementallimitations, restrictions and closures of Resort operations resulting from COVID-19. Additionally, operating expenses from Whistler Blackcomb as a result of reflecting a full year of operations as compared to Fiscal 2017, which included operations from the dateexpense includes $1.0 million and $13.6 million of acquisition October 17, 2016, through July 31, 2017.and integration related expenses for Fiscal 2021 and Fiscal 2020, respectively.

Labor and labor-related benefits increased 10.1%decreased 4.4%, primarily due to incremental expense from Whistler Blackcombcost discipline efforts in the current year associated with limitations, restrictions and Stowe,closures of our Resort operations as a result of COVID-19, as well as normal wage adjustments,incremental tax credits of approximately $10.3 million primarily associated with COVID-19 related legislation passed in Canada, partially offset by lower performance-basedan increase in variable compensation. Retail cost of sales decreased 20.7% compared to a decrease in retail sales of 23.5%, reflecting a higher mix of aged retail products sold at reduced margins. Resort related fees increased 4.3%decreased 7.0% primarily due to higherdecreases in revenue on which those fees are based. General and administrative expense increased 5.8%, primarily due to a $13.2 million charge recorded during the fourth quarter of Fiscal 2021 for a contingent obligation with respect to employment-related litigation, as well as an increase in variable compensation accruals, partially offset by incremental tax credits of approximately $2.7 million primarily associated with COVID-19 related legislation passed in Canada and Australia. Other expense decreased 10.2% primarily due to decreases in variable operating expenses associated with reduced revenues, as well as a decrease in acquisition and integration related expenses of $12.6 million.

Mountain equity investment income, net primarily includes our share of income from the operations of a real estate brokerage joint venture. Mountain equity investment income from the real estate brokerage company increased $5.0 million (296.3%) for Fiscal 2021 compared to Fiscal 2020 due to a significant increase in both the number of real estate sales and the average price of those sales.

Fiscal 2020 compared to Fiscal 2019
Mountain Reported EBITDA decreased $178.5 million, or 26.3%, primarily due to the impact of the deferral of $120.9 million of pass product revenue during Fiscal 2020 as a result of the Credit Offer to 2019/2020 North American pass product holders from the Resort Closures and the overall impacts of the COVID-19 pandemic, which resulted in significantly reduced visitation and operations at our Resorts and retail stores for the 2019/2020 North American ski season, the 2020 Australian ski season and our 2020 North American summer operations. These decreases were partially offset by the incremental operations of Peak Resorts, Falls Creek and Hotham. Mountain segment results include $13.6 million and $16.4 million of acquisition and integration related expenses for Fiscal 2020 and Fiscal 2019, respectively, which are recorded within Mountain other operating expense.

Lift revenue decreased $120.1 million, or 11.6%, primarily due to a 3.4% decrease in pass product revenue and an 18.8% decrease in non-pass revenue. Pass product revenue decreased primarily as a result of the deferral of approximately $120.9 million of pass product revenue associated with the Credit Offer to 2019/2020 North American pass product holders, which would have been recognized during Fiscal 2020 and which was instead recognized primarily in the second and third quarters of Fiscal 2021, partially offset by a combination of an increase in pricing and units sold and increased pass sales to Destination guests, as well as the introduction of the Epic Day Pass. Non-pass revenue decreased primarily due to significantly
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reduced skier visitation as a result of the Resort Closures, partially offset by an increase in non-pass ETP (excluding Peak Resorts, Falls Creek and Hotham) of 6.2% and incremental revenue from Peak Resorts, Falls Creek and Hotham of approximately $61.4 million. Total non-pass ETP, including the impact of Peak Resorts, Falls Creek and Hotham decreased 7.3%.

Ski school revenue, dining revenue and retail/rental revenue in Fiscal 2020 all decreased compared to Fiscal 2019 due to the Resort Closures. These decreases were partially offset by incremental revenue from our acquisitions of Peak Resorts, Falls Creek and Hotham of $18.0 million of ski school revenue, $23.8 million of dining revenue and $26.8 million of retail/rental revenue.

Other revenue mainly consists of summer visitation and mountain activities revenue, employee housing revenue, guest services revenue, commercial leasing revenue, marketing and internet advertising revenue, private club revenue (which includes both club dues and amortization of initiation fees), municipal services revenue and other recreation activity revenue. Other revenue is also comprised of Australian ski area lodging and transportation revenue. For Fiscal 2020, other revenue decreased as a result of the Resort Closures, partially offset by incremental revenue from Peak Resorts of approximately $12.6 million.

Resort Closures and the associated actions taken by the Company to reduce costs resulted in a decrease in our operating expense of $67.5 million, or 5.3%, which includes incremental operating expenses from Peak Resorts, Falls Creek and Hotham of approximately $121.4 million, as well as $13.6 million and $16.4 million of acquisition and integration related expenses for Fiscal 2020 and Fiscal 2019, respectively.

Labor and labor-related benefits decreased 6.8%, which primarily resulted from cost actions associated with the Resort Closures, including decreased staffing, employee furloughs, salary reductions and reduced variable compensation accruals, as well as tax credits of approximately $12.0 million associated with COVID-19 related legislation passed in the U.S., Canada and Australia, partially offset by incremental expenses from Peak Resorts, Falls Creek and Hotham of approximately $50.7 million. Retail cost of sales decreased 20.5% compared to a decrease in retail sales of 20.1%. Resort related fees decreased 22.0% primarily due to decreases in revenue on which those fees are based, andpartially offset by incremental expenses from Stowe.Peak Resorts of approximately $4.3 million. General and administrative expense increased 7.3% due to higher corporate overhead costs, including incremental expenses from Stowe, partially offset by lower estimated performance-based variable compensation. Other expense increased 11.4%2.7% primarily due to incremental expenses from Whistler BlackcombPeak Resorts, Falls Creek and Stowe, as well as increases in repairs and maintenance expense, utilities expense (primarily related to increased snowmaking operations), food and beverage costHotham of sales commensurate with increases in dining revenue and property taxes,approximately $18.9 million, partially offset by a decrease in rent expense.allocated corporate overhead costs, a decrease in variable compensation accruals primarily as a result of the Resort Closures and tax credits of approximately $3.3 million associated with COVID-19 related legislation passed in the U.S., Canada and Australia. Other expense increased 2.1% primarily due to incremental operating expenses from Peak Resorts, Falls Creek and Hotham of approximately $42.2 million, partially offset by decreases in variable operating expenses associated with the Resort Closures, as well as a decrease in acquisition and integration related expenses.


Mountain equity investment income, net primarily includes our share of income from the operations of a real estate brokerage joint venture.

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Fiscal 2017 compared to Fiscal 2016
The results reflected an increase in Mountain Reported EBITDA of $141.9 million, or 33.4%, primarily due to the operations of Whistler Blackcomb, which was included in our consolidated results prospectively from the acquisition date (acquired in October 2016), partially offset by $10.8 million of acquisition and integration related expenses. Additionally, Stowe was acquired in June 2017 and its off-season operations were included in our consolidated results prospectively from the acquisition date. Excluding acquisition and integration related expenses and the operations of Whistler Blackcomb and Stowe, Mountain Reported EBITDA increased 9.1%. Our results reflected strong U.S. season pass sales growth for the 2016/2017 North American ski season. However, our Fiscal 2017 results were tempered by poor early ski season conditions prior to the holiday period at our U.S. resorts which drove lower skier visitation during the early ski season.

Lift revenue increased $160.3 million, or 24.4%, primarily due to incremental lift revenue from Whistler Blackcomb. Excluding Whistler Blackcomb, total lift revenue increased 6.4% of which non-pass revenue decreased 1.5% and pass revenue increased 18.3%. The decrease in non-pass revenue, excluding Whistler Blackcomb, was primarily the result of a decrease in non-pass skier visitation to our U.S. resorts, primarily due to continued shifting of Destination guests to season passes and poor early season conditions in Colorado, partially offset by an increase in ETP excluding season pass holders of 6.5%. The increase in pass revenue, excluding Whistler Blackcomb, was due to a combination of both an increase in pricing and units sold and was favorably impacted by increased pass sales to Destination guests. The change in total ETP was negatively impacted by the inclusion of Whistler Blackcomb’s ETP in our Fiscal 2017 results, which was lower on a U.S. dollar basis than the Company average. Total ETP, excluding Whistler Blackcomb, increased $7.49, or 11.4%, due primarily to price increases in both our lift ticket products at our U.S. mountain resorts and season pass products, and lower average visitation by U.S. season pass holders during the 2016/2017 U.S. ski season as compared with the 2015/2016 U.S. ski season.

Ski school revenue increased $34.5 million, or 24.1%, primarily due to incremental ski school revenue from Whistler Blackcomb. Excluding Whistler Blackcomb, ski school revenue increased 2.7%, primarily due to increases in pricing. Dining revenue increased $29.6 million, or 24.4%, due to incremental revenue from Whistler Blackcomb. Excluding Whistler Blackcomb, dining revenue increased 0.6%.


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Retail/rental revenue increased $52.3 million, or 21.7%, primarily due to incremental retail/rental revenue from Whistler Blackcomb. Excluding Whistler Blackcomb, retail revenue increased 2.1% and rental revenue increased 0.8%. The increase in retail revenue was primarily attributable to strong sales at pre-ski season sales events at our stores in Colorado and higher sales volumes at stores proximate to our Tahoe and Park City resorts.

For Fiscal 2017, other revenue increased $30.5 million, or 21.6%, primarily attributable to incremental revenue from Whistler Blackcomb. Excluding Whistler Blackcomb and Stowe, other revenue increased 2.2% primarily due to an increase in summer activities revenue from our U.S. mountain resorts, including the expansion of our on-mountain Epic Discovery summer activities offerings.

Operating expense for Fiscal 2017 increased $165.9 million, or 18.8%, which was primarily attributable to incremental operating expenses from Whistler Blackcomb, as well as $10.8 million of acquisition and integration related expenses. Excluding incremental operating expenses of Whistler Blackcomb and Stowe and acquisition and integration related activities, operating expense increased 1.7%.

The following discussion provides information about the changes in operating expenses for Fiscal 2017, excluding acquisition and integration related expenses and the operations of Whistler Blackcomb and Stowe. Labor and labor-related benefits increased 2.8% primarily due to normal wage adjustments and increased staffing levels at our U.S. resorts to support the expansion of our on-mountain Epic Discovery summer activities offerings, partially offset by lower performance-based variable compensation. Retail cost of sales increased 1.3%, compared to an increase in retail sales of 2.0%. Resort related fees increased 3.5% due to overall increases in revenue upon which those fees are based. General and administrative expense increased 1.3% due to increased corporate overhead costs. Other expense decreased 0.2% primarily due to decreased professional services expense and repairs and maintenance expense, partially offset by increased rent expense and utilities expense.

Mountain equity investment income, net primarily includes our share of income from the operations of a real estate brokerage joint venture.


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Lodging Segment
Lodging segment operating results for Fiscal 2018,2021, Fiscal 20172020 and Fiscal 20162019 are presented by category as follows (in thousands, except ADR and RevPAR):
    Percentage
 Year ended July 31,Increase/(Decrease)
  
2021202020192021/20202020/2019
Lodging net revenue:
Owned hotel rooms$47,509 $44,992 $64,826 5.6 %(30.6)%
Managed condominium rooms72,217 76,480 86,236 (5.6)%(11.3)%
Dining19,068 38,252 53,730 (50.2)%(28.8)%
Transportation9,271 15,796 21,275 (41.3)%(25.8)%
Golf20,437 17,412 19,648 17.4 %(11.4)%
Other43,007 44,933 54,617 (4.3)%(17.7)%
Lodging net revenue (excluding payroll cost reimbursements)211,509 237,865 300,332 (11.1)%(20.8)%
Payroll cost reimbursements6,553 10,549 14,330 (37.9)%(26.4)%
Total Lodging net revenue218,062 248,414 314,662 (12.2)%(21.1)%
Lodging operating expense:
Labor and labor-related benefits101,582 114,279 135,940 (11.1)%(15.9)%
General and administrative43,714 39,283 41,256 11.3 %(4.8)%
Other71,946 81,034 95,036 (11.2)%(14.7)%
Lodging operating expense (excluding reimbursed payroll costs)217,242 234,596 272,232 (7.4)%(13.8)%
Reimbursed payroll costs6,553 10,549 14,330 (37.9)%(26.4)%
Total Lodging operating expense223,795 245,145 286,562 (8.7)%(14.5)%
Lodging Reported EBITDA$(5,733)$3,269 $28,100 (275.4)%(88.4)%
       Percentage
 Year Ended July 31, Increase/(Decrease)
  
2018 2017 2016 2018/2017 2017/2016
Lodging net revenue:         
Owned hotel rooms$65,252
 $63,939
 $63,520
 2.1 % 0.7 %
Managed condominium rooms70,198
 65,694
 61,934
 6.9 % 6.1 %
Dining48,554
 48,449
 49,225
 0.2 % (1.6)%
Transportation21,111
 22,173
 22,205
 (4.8)% (0.1)%
Golf18,110
 17,837
 17,519
 1.5 % 1.8 %
Other47,577
 46,238
 47,833
 2.9 % (3.3)%
 270,802
 264,330
 262,236
 2.4 % 0.8 %
Payroll cost reimbursements13,841
 14,184
 12,318
 (2.4)% 15.1 %
Total Lodging net revenue284,643
 278,514
 274,554
 2.2 % 1.4 %
Lodging operating expense:         
Labor and labor-related benefits121,733
 117,183
 114,404
 3.9 % 2.4 %
General and administrative37,716
 37,217
 35,351
 1.3 % 5.3 %
Other86,347
 82,843
 84,312
 4.2 % (1.7)%
 245,796
 237,243
 234,067
 3.6 % 1.4 %
Reimbursed payroll costs13,841
 14,184
 12,318
 (2.4)% 15.1 %
Total Lodging operating expense259,637
 251,427
 246,385
 3.3 % 2.0 %
Lodging Reported EBITDA$25,006
 $27,087
 $28,169
 (7.7)% (3.8)%
Owned hotel statistics (1)
ADR$264.83 $266.43 $256.50 (0.6)%3.9 %
RevPar$122.45 $122.34 $175.45 0.1 %(30.3)%
Managed condominium statistics (1)
ADR$349.08 $328.98 $324.34 6.1 %1.4 %
RevPar$77.74 $83.10 $107.67 (6.5)%(22.8)%
Owned hotel and managed condominium statistics (combined) (1)
ADR$322.15 $310.76 $300.47 3.7 %3.4 %
RevPar$85.99 $90.37 $121.81 (4.8)%(25.8)%
Owned hotel statistics:         
ADR$250.50
 $245.31
 $227.27
 2.1 % 7.9%
RevPar$173.34
 $168.14
 $153.13
 3.1 % 9.8%
Managed condominium statistics:         
ADR$336.29
 $347.64
 $325.38
 (3.3)% 6.8%
RevPar$116.26
 $113.08
 $109.68
 2.8 % 3.1%
Owned hotel and managed condominium statistics (combined):         
ADR$300.90
 $302.80
 $280.38
 (0.6)% 8.0%
RevPar$131.08
 $127.95
 $122.61
 2.4 % 4.4%

(1) RevPAR for Fiscal 2021 and Fiscal 2020 declined from Fiscal 2019 primarily due to limitations and restrictions on our North American operations resulting from COVID-19, as well as the impact of the Resort Closures.
Lodging Reported EBITDA includes $3.2$3.8 million, $3.2$3.4 million and $3.1$3.2 million of stock-based compensation expense for Fiscal 2018,2021, Fiscal 20172020 and Fiscal 2016,2019, respectively.

Fiscal 20182021 compared to Fiscal 20172020
Lodging Reported EBITDA for Fiscal 20182021 decreased $2.1$9.0 million, or 7.7% primarily due to general cost increases and a one-time benefit recorded in Fiscal 2017 for association fees with respect to a lodging property at Park City.

Revenue from owned hotel rooms increased $1.3 million, or 2.1%275.4%, primarily due to an increase in occupancy at Flagg Ranch, which incurred an early closure in Fiscal 2017 as a result of limitations and restrictions on our North American operations in the current year as a forest fireresult of the impacts of COVID-19, which resulted in Grand Teton National Park,reduced occupancy and capacity-related restrictions at our lodging properties compared to the prior year.
Revenue from managed condominium rooms, dining, transportation, and other revenue each decreased primarily as well as an increase in revenue at GTLC,a result of the impacts of COVID-19. These decreases were partially offset by decreasedincreases in revenue from golf, primarily due to strong
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summer demand in Fiscal 2021, and owned hotel rooms, primarily as a result of increased revenue from GTLC and partially offset by decreases at our owned Coloradoother lodging properties as a result of lower winter visitation. Revenue from managed condominium rooms increased $4.5 million, or 6.9%, primarily due to increased revenue at our Colorado managed properties as a resultthe impacts of increased demand, partially offset by a decrease in ADR, as well as incremental revenue from a Park City lodging property which was temporally closed for renovations in the prior year. Additionally, managed condominium rooms revenue was positively impacted by incremental revenue at Whistler Blackcomb.COVID-19.


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Transportation revenue decreased $1.1 million, or 4.8%, primarily due to decreased passenger volume. Other revenue increased $1.3 million, or 2.9%, primarily due to increases in conference services revenue and ancillary revenue, partially offset by a business interruption insurance recovery recorded in Fiscal 2017 related to the early closure of our Flagg Ranch property in September 2016, as discussed above.


Operating expense (excluding reimbursed payroll costs) increased $8.6 million, or 3.6%decreased 7.4%. Labor and labor-relatedlabor related benefits decreased 11.1% primarily due to decreased staffing associated with COVID-19. General and administrative expense increased $4.6 million, or 3.9%,11.3% due to an increase in allocated corporate overhead costs across all functions, including variable compensation accruals, primarily resulting from higher labor expense for Park City and Flagg Ranch, which were both closed foras a portionresult of lower costs in the prior year period, incremental expenses from Whistler Blackcomb and normal wage increases, partially offset by lower performance-based variable compensation.associated with the Resort Closures. Other expense increased $3.5 million, or 4.2%, primarily duedecreased 11.2% related to lower variable expenses associated with reduced revenue as a one-time benefit for association fees with respect to a lodging property at Park City that was recorded in Fiscal 2017, as well as increases in variable operating expenses and an increase in property taxes.result of COVID-19.


Revenue from payroll cost reimbursementsreimbursement and the corresponding reimbursed payroll costs relatesrelate to payroll costs at managed hotel properties where we are the employer and all payroll costs are reimbursed by the owners of the properties under contractual arrangements. Since the reimbursements are made based upon the costs incurred with no added margin, the revenue and corresponding expense have no effect on our Lodging Reported EBITDA.

Fiscal 20172020 compared to Fiscal 20162019
Lodging Reported EBITDA for Fiscal 20172020 decreased $1.1$24.8 million, or 3.8%. Lodging Reported EBITDA for Fiscal 2017 included the operations of Whistler Blackcomb prospectively since the date of acquisition and was impacted by a reduction of revenue and EBITDA from the sale of a hotel property in Keystone in November 2016, which we continue to manage under a property management agreement. Included in Lodging Reported EBITDA for Fiscal 2016 was the recognition of a $3.5 million termination fee (included in other revenue) associated with the termination of the management agreement at Half Moon in Montego Bay, Jamaica (“Half Moon Termination Fee”). Excluding Whistler Blackcomb operations from Fiscal 2017, operations from the hotel property in Keystone from both periods and the Half Moon Termination Fee from Fiscal 2016, Lodging Reported EBITDA increased 9.2%, which was primarily attributable to an increase in revenue at GTLC and increased ADR at our Colorado managed condominium rooms.

Revenue from owned hotel rooms increased $0.4 million, or 0.7%, primarily due to an increase in revenue at GTLC and at our owned Colorado lodging properties during Fiscal 2017. These increases were partially offset by a decrease in revenue associated with the sale of a hotel property in Keystone, as discussed above, as well as lower revenue due to the early closure of our Flagg Ranch property as a result of a forest fire near Grand Teton National Park in September 2016. Revenue from managed condominium rooms increased $3.8 million, or 6.1%, primarily due to revenue from Whistler Blackcomb and increased ADR at our Colorado managed properties, partially offset by the temporary closure of a lodging property at Park City for renovations.

Dining revenue for Fiscal 2017 decreased $0.8 million, or 1.6%88.4%, primarily due to the temporary closureimpacts of the COVID-19 pandemic and the associated Resort Closures.
Primarily as a lodging property at Park City for renovations,result of the Resort Closures, revenue from owned hotel rooms, managed condominium rooms, dining, transportation, golf and other revenue each decreased. The decreases resulting from the Resort Closures were partially offset by increased dining revenue at our Colorado lodging properties. Excluding the Half Moon Termination Fee from Fiscal 2016, other revenue increased $1.9$13.7 million or 4.2%, primarily due to a business interruption insurance recovery related to the early closure of our Flagg Ranch property in September 2016, as discussed above, as well as an increase inincremental revenue from our central reservations booking service.Peak Resorts and Triple Peaks.


Operating expense (excluding reimbursed payroll costs) increased $3.2 million, or 1.4%decreased 13.8%. Labor and labor-relatedlabor related benefits increased $2.8decreased 15.9% primarily due to cost actions associated with the Resort Closures, including decreased staffing, employee furloughs, salary reductions and reduced variable compensation accruals, as well as tax credits of approximately $2.2 million or 2.4%associated with recent COVID-19 related legislation passed in the U.S., primarily resultingCanada and Australia, partially offset by $6.4 million of incremental expenses from Whistler Blackcomb labor expensePeak Resorts and normal wage increases.Triple Peaks. General and administrative expense increased $1.9 million, or 5.3%decreased 4.8% due to higherlower allocated corporate overhead costs.costs primarily associated with a reduction in variable compensation accruals, as well as tax credits of approximately $0.5 million associated with recent COVID-19 related legislation passed in the U.S., Canada and Australia. Other expenseexpenses decreased $1.514.7% primarily related to lower variable expenses associated with the impact of the Resort Closures, partially offset by $4.7 million or 1.7%, primarily due to a one-time benefit for association fees with respect to a lodging property at Park City.of incremental expenses from Peak Resorts and Triple Peaks.


Revenue from payroll cost reimbursementsreimbursement and the corresponding reimbursed payroll costs relatesrelate to payroll costs at managed hotel properties where we are the employer and all payroll costs are reimbursed by the owners of the properties under contractual arrangements. Since the reimbursements are made based upon the costs incurred with no added margin, the revenue and corresponding expense have no effect on our Lodging Reported EBITDA.


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Real Estate Segment
Real Estate segment operating results for Fiscal 2018, Fiscal 2017 and Fiscal 2016 are presented by category as follows (in thousands):
       Percentage
 Year Ended July 31, Increase/(Decrease)
  
2018 2017 2016 2018/2017 2017/2016
Total Real Estate net revenue$3,988
 $16,918
 $22,128
 (76.4)% (23.5)%
Real Estate operating expense:         
Cost of sales (including sales commissions)3,927
 14,534
 17,682
 (73.0)% (17.8)%
Other, net(381) 9,549
 6,957
 (104.0)% 37.3 %
Total Real Estate operating expense3,546
 24,083
 24,639
 (85.3)% (2.3)%
Gain on sale of real property515
 6,766
 5,295
 (92.4)% 27.8 %
Real Estate Reported EBITDA$957
 $(399) $2,784
 339.8 % (114.3)%

Real Estate Reported EBITDA includes $0.1 million, $0.1 million and $0.5 million of stock-based compensation expense for Fiscal 2018, Fiscal 2017 and Fiscal 2016, respectively.


Our Real Estate operatingnet revenue is primarily determined by the timing of closings and the mix of real estate sold in any given period. Different types of projects have different revenue and profit margins; therefore, as the real estate inventory mix changes, it can greatly impact Real Estate segment net revenue, operating expense, gain on sale of real property and Real Estate Reported EBITDA. During

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Real Estate segment operating results for Fiscal 2018, we2021, Fiscal 2020 and Fiscal 2019 are presented by category as follows (in thousands):
    Percentage
 Year ended July 31,Increase/(Decrease)
  
2021202020192021/20202020/2019
Total Real Estate net revenue$1,770 $4,847 $712 (63.5)%580.8 %
Real Estate operating expense:
Cost of sales (including sales commissions)1,294 3,932 13 (67.1)%30,146.2 %
Other5,382 5,250 5,596 2.5 %(6.2)%
Total Real Estate operating expense6,676 9,182 5,609 (27.3)%63.7 %
Gain on sale of real property324 207 580 56.5 %(64.3)%
Real Estate Reported EBITDA$(4,582)$(4,128)$(4,317)(11.0)%4.4 %

Fiscal 2021
We did not haveclose on any condominium units available for sale as all remaining units were sold insignificant real estate transactions during Fiscal 2017.

Fiscal 2018
During the fiscal year, we closed on the sales of development land parcels for $3.5 million which were recorded within Real Estate net revenue.

2021. Other net operating expense included the recognition of a $5.5$5.4 million benefit (non-cash in the current period) related to a legal
settlement in Fiscal 2015 for which cash proceeds were received and established as a liability for estimated future remediation costswas primarily comprised of a construction development. All known items have been remediated and, based on continued monitoring, the Company has concluded that the need for further remediation is remote. Additionally, other, net operating expense included general and administrative costs, such as labor and labor-related benefits, professional services and allocated corporate overhead costs.

Fiscal 2020
During Fiscal 2020, we closed on the sale of a development land parcel for $4.1 million which was recorded within Real Estate net revenue, with a corresponding cost of sale (including sales commission) of $3.9 million.
Other operating expense of $5.3 million was primarily comprised of general and administrative costs, such as labor and labor-related benefits, professional services and allocated corporate overhead costs.

Fiscal 2019
We closed on two land sales during the third quarter of Fiscal 2019 with third party developers at Keystone (One River Run site) and Breckenridge (East Peak 8 site) for proceeds of approximately $16.0 million, including $4.8 million associated with the sale of density for the Breckenridge property. The land parcel sales were accounted for as financing arrangements as a result of the Company’s continuing involvement with the underlying assets that were sold, including but not limited to, the obligation to repurchase finished commercial space from the development projects upon completion. As a result, the estimated gain of $3.6 million associated with the East Peak 8 site and the estimated loss of $3.2 million associated with the One River Run site will be deferred until the Company no longer maintains continuing involvement. Additionally, the Company’s future obligation to repurchase finished commercial space in the two completed projects, as well as other related capital spending, will result in total estimated capital expenditures of up to approximately $9.5 million in future fiscal years.

Other operating expense of $5.6 million was primarily comprised of general and administrative costs, such as labor and labor-related benefits, professional services and allocated corporate overhead costs. Real Estate Reported EBITDA also included a gain on sale of real property of $0.5$0.6 million for the sale of a land parcel.

Fiscal 2017
Real Estate segment net revenue was primarily driven by the closing of four condominium units at The Ritz-Carlton Residences, Vail ($13.6 million of revenue with an average selling price of $3.4 million and an average price per square foot of $1,345) and two condominium units at One Ski Hill Place in Breckenridge ($2.3 million of revenue with an average sales price of $1.1 million and an average price per square foot of $983). The average price per square foot of both of these projects is driven by their premier locations and the comprehensive and exclusive amenities related to these projects. 

Operating expense included cost of sales of $13.4 million resulting from the closing of four condominium units at The Ritz-Carlton Residences, Vail (average cost per square foot of $1,131) and two condominium units at One Ski Hill Place (average cost per square foot of $838). Additionally, sales commissions of approximately $1.0 million were incurred commensurate with revenue recognized. Other operating expense of $9.5 million was primarily comprised of a $4.3 million one-time charge related to the resolution of a financial contingency to the Town of Vail for incremental parking capacity, as well as general and administrative costs, which includes marketing expense for the real estate available for sale, carrying costs for units available for sale and overhead costs, such as labor and labor-related benefits and allocated corporate costs.

In addition, we recorded a gain on sale of real property of $6.5 million for a land parcel in Breckenridge which sold for $9.3 million during Fiscal 2017.


parcels.
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Fiscal 2016
Real Estate segment net revenue was driven primarily by the closing of five condominium units at The Ritz-Carlton Residences, Vail ($15.6 million of revenue with an average selling price per unit of $3.1 million and an average price per square foot of $1,421); two condominium units at One Ski Hill Place in Breckenridge ($2.5 million of revenue with an average selling price per unit of $1.2 million and an average price per square foot of $1,129); and the three remaining condominium units at Crystal Peak Lodge, in Breckenridge ($2.4 million of revenue with an average selling price of $0.8 million and an average price per square foot of $707). The average price per square foot for all three projects is primarily due to their premier locations and the comprehensive and exclusive amenities related to these projects.

Operating expense included cost of sales of $15.6 million primarily resulting from the closing of five condominium units at The Ritz-Carlton Residences, Vail (average cost per square foot of $1,075); two condominium units at One Ski Hill Place (average cost per square foot of $931); and three condominium units at Crystal Peak Lodge (average cost per square foot of $513). The cost per square foot for the One Ski Hill Place and The Ritz-Carlton Residences, Vail projects is reflective of the high-end features and amenities and high construction costs associated with mountain resort development. Additionally, sales commissions of approximately $1.4 million were incurred commensurate with revenue recognized. Other operating expense of $7.0 million was primarily comprised of general and administrative costs which includes marketing expense for the real estate available for sale (including those units that have not yet closed), carrying costs for units available for sale and overhead costs, such as labor and labor-related benefits and allocated corporate costs.

In addition, we recorded a gain on sale of real property of $5.3 million (net of $2.1 million in related land basis and cost) for various land parcels which sold for $7.4 million.

Other Items
In addition to segment operating results, the following material items contributecontributed to our overall financial position and results of operations (in thousands).
Year ended July 31,Percentage Increase/(Decrease)
2021202020192021/20202020/2019
Depreciation and amortization$(252,585)$(249,572)$(218,117)1.2 %14.4 %
Asset impairments$— $(28,372)$— (100.0)%nm
Change in fair value of contingent consideration$(14,402)$2,964 $(5,367)(585.9)%155.2 %
Interest expense, net$(151,399)$(106,721)$(79,496)41.9 %34.2 %
Foreign currency gain (loss) on intercompany loans$8,282 $(3,230)$(2,854)356.4 %(13.2)%
Provision for income taxes$(726)$(7,378)$(75,472)(90.2)%(90.2)%
Effective tax rate(0.6)%(6.3)%(18.9)%(5.7 pts)(12.6 pts)
 Year Ended July 31, Percentage Increase/(Decrease)
 2018 2017 2016 2018/2017 2017/2016
Depreciation and amortization$(204,462) $(189,157) $(161,488) 8.1 % 17.1 %
Change in fair value of contingent consideration$1,854
 $(16,300) $(4,200) 111.4 % (288.1)%
Investment income and other, net$1,944
 $6,114
 $723
 (68.2)% 745.6 %
Interest expense, net$(63,226) $(54,089) $(42,366) 16.9 % 27.7 %
Foreign currency (loss) gain on intercompany loans$(8,966) $15,285
 $—
 (158.7)% nm
Benefit (provision) for income taxes$61,138
 $(116,731) $(93,165) 152.4 % 25.3 %

Depreciation and amortization. Depreciation and amortization expense for both Fiscal 20182021 and Fiscal 20172020 increased over the applicable prior fiscal yearFiscal 2019 primarily due to an increase in the fixed asset base due to incremental capital expenditures, including assets acquired in the Whistler Blackcomb (acquired October 2016)Peak Resorts acquisition (incremental impact of $24.3 million in Fiscal 2020 relative to Fiscal 2019), as well as discretionary capital projects completed at our resorts in each fiscal year.
Asset impairments. We recorded an asset impairment of approximately $28.4 million during Fiscal 2020 as a result of the effects of COVID-19 on our Colorado resort ground transportation company, with corresponding reductions to goodwill, net of $25.7 million and Stowe (acquired June 2017) acquisitions.intangible assets, net and property, plant and equipment, net of $2.7 million. See Notes to the Consolidated Financial Statements for additional information.


Change in fair value of contingent consideration.consideration. We recorded a loss of $14.4 million during Fiscal 2021 primarily related to improved performance compared to estimated results for Park City in Fiscal 2021, resulting in an increase in the expected payment for the year, as well as accretion resulting from the passage of time. We recorded a gain of $1.9$3.0 million during Fiscal 20182020 primarily related to a decrease in the estimated Contingent Consideration payments for Fiscal 2020 and Fiscal 2021 as a result of a decrease in expected results due to the anticipated impacts of COVID-19. We recorded a loss of $5.4 million during Fiscal 2019 primarily related to the estimated Contingent Consideration payment for Fiscal 2018. Additionally, losses of $16.3 million and $4.2 million were recorded during Fiscal 2017 and Fiscal 2016, respectively, related to increases in the2019. The estimated fair value of the future participating contingent payments under the lease for Park City. The fair value of contingent consideration is based on assumptions for EBITDA of Park City in future periods, as calculated under the lease on which participating payments are determined. The estimated fair value of the contingent considerationdetermined, and was $21.9$29.6 million and $27.4$17.8 million as of July 31, 20182021 and 2017,2020, respectively.

Investment income and other,Interest expense, net. Investment income and other, Interest expense, net increased for Fiscal 20172021 increased compared to Fiscal 2016,2020 primarily due to a $3.4borrowings under our 6.25% unsecured bond offering, which was completed on May 4, 2020 (the “6.25% Notes”) and generated approximately $28.3 million gain recognized on short-term foreign currency forward contracts that were entered intoof incremental interest expense in conjunctionFiscal 2021, and $12.5 million of non-cash interest expense associated with fundingamortization of the cash consideration requireddebt discount for the Whistler Blackcomb acquisition, a $0.9 million gain recorded for the sale of a lodging property and a $0.8 million non-cash gain recognized on an investment0.0% Convertible Notes, which were issued in Whistler Blackcomb shares that were held prior to the acquisition.

Interest expense, net.December 2020. Interest expense, net increased for Fiscal 2018 and2020 increased compared to Fiscal 20172019 primarily due to interest expense associated withdebt obligations assumed in the Peak Resorts acquisition; borrowings under our 6.25% unsecured bond offering which was completed on May 4, 2020; incremental term loan borrowings under the Vail Holdings Credit Agreement of $509.4$335.6 million, which waswere used to fund the cash consideration portion of the Whistler BlackcombPeak Resorts acquisition in October 2016, as well asSeptember 2019; and incremental borrowings under the revolver components of our Vail Holdings Credit Agreement and Whistler Credit Agreement, which was assumedwere almost entirely drawn on during Fiscal 2020 as parta precautionary measure in order to increase our cash position and financial flexibility in light of the Whistler Blackcomb acquisition.financial market conditions resulting from the COVID-19 pandemic and were subsequently paid down, partially offset by a decrease in variable interest rates.

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Foreign currency gain (loss) gain on intercompany loans. Foreign currency gain (loss) gain on intercompany loans for Fiscal 20182021 increased as compared to Fiscal 2020 and decreased for Fiscal 20172020 as compared to Fiscal 2019 as a result of the Canadian dollar fluctuating relative to the U.S. dollar, and was associated with an intercompany loan from Vail Holdings, Inc. to Whistler Blackcomb in the original amount of $210.0 million that was funded, effective as of November 1, 2016, in connection with the acquisition of Whistler Blackcomb. This intercompany loan, which had an outstanding balance of approximately $97.2 million as of July 31, 2021, requires foreign currency remeasurement to Canadian dollars, the functional currency for Whistler Blackcomb. As a result, foreign currency fluctuations associated with the loan are recorded within our results of operations.

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Benefit (provision)

Provision for income taxes. OurThe effective tax rate benefit (provision) was 18.0%(0.6)%, (33.5%)(6.3)% and (38.4%)(18.9)% in Fiscal 2018,2021, Fiscal 20172020 and Fiscal 2016,2019, respectively. Our tax benefit (provision) and effective tax rate are driven primarily by the amount of pre-tax income, which is adjusted for items that are deductible/non-deductible for tax purposes only (i.e. permanent items), excess tax benefits from employee share awards, enacted tax legislation and taxable income generated by state and foreign jurisdictions that varies from the consolidated pre-tax income and the amount of net income attributable to noncontrolling interests. The change in the effective tax rate during Fiscal 2018 compared to Fiscal 2017 was primarily driven by the Tax Act and excess tax benefits from employee share awards that were exercised, as further discussed below. The decrease in the effective tax rate provision during Fiscal 20172021 compared to Fiscal 20162020 was primarily associated with the Whistler Blackcomb acquisition, where the Canadian statutory tax rate was lower than the U.S. statutory tax rate during Fiscal 2017 (prior to enactment of the Tax Act). 

On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Act. The Tax Act transitions the U.S. tax system to a new territorial system and lowers the statutory federal corporate income tax rate from 35% to 21%. The reduction of the statutory federal corporate tax rate to 21% became effective on January 1, 2018. As a result of the Tax Act, we recorded a one-time, provisional net tax benefit of approximately $61.0 million on our Consolidated Statement of Operations for Fiscal 2018. Due to the reductiondriven by an increase in the federal corporate tax rate, we remeasured our U.S. net deferred tax liabilities as of the effective date of the Tax Act using the reduced statutory federal corporate income tax rate. The U.S. net deferred tax liabilities remeasurement resulted in a one-time tax benefit estimated to be approximately $67.0 million, which was recognized as a discrete item and was recorded within benefit (provision) for income taxes on our Consolidated Statement of Operations during Fiscal 2018. Also, in transitioning to the new territorial tax system, the Tax Act requires us to include certain foreign earnings of non-U.S. subsidiaries in our Fiscal 2018 taxable income. Such foreign earnings are subject to a one-time tax. The Transition Tax was estimated to be approximately $6.0 million and was recorded during Fiscal 2018. The above-mentioned accounting impacts of the deferred tax remeasurement and Transition Tax are provisional, based on currently available information and technical guidance on the interpretation of the new law. The provisional accounting impacts may change in future reporting periods until the accounting analysis is finalized, which will occur not later than the second quarter of fiscal 2019, as permitted by the SEC.

Additionally, the change in the effective tax rate during Fiscal 2018 compared to Fiscal 2017 was also due to excess tax benefits from employee share awards that were exercised (stock appreciation awards)rights) and that vested (restricted stock awards), which were recorded within benefit (provision) for income taxes. The decrease in the effective tax rate during Fiscal 20182020 compared to Fiscal 2019 was primarily due to lower full year pre-tax net income, as well as a resultone-time, provisional $3.8 million benefit related to the net operating loss carryback provision of new accounting guidance that was adopted prospectively as of August 1, 2017. The new guidance requiresthe Coronavirus Aid, Relief, and Economic Security Act, partially offset by a decrease in excess tax benefits to be recorded in the period realized as a discrete item within earnings rather than within equity. As a result of adopting this guidance, we recorded $71.1 million of excess tax benefits within benefit (provision) for income taxes on our Consolidated Statement of Operations for Fiscal 2018.from employee share awards that were exercised (stock appreciation rights) and that vested (restricted stock awards).


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Reconciliation of Segment Earnings
The following table reconciles from segment Reported EBITDA to net income attributable to Vail Resorts, Inc. to Total Reported EBITDA for Fiscal 2018,2021, Fiscal 20172020 and Fiscal 20162019 (in thousands):
Year ended July 31,
Year Ended July 31,
202120202019
Net income attributable to Vail Resorts, Inc.Net income attributable to Vail Resorts, Inc.$127,850 $98,833 $301,163 
Net (loss) income attributable to noncontrolling interestsNet (loss) income attributable to noncontrolling interests(3,393)10,222 22,330 
Net incomeNet income124,457 109,055 323,493 
Provision for income taxesProvision for income taxes726 7,378 75,472 
Income before provision for income taxesIncome before provision for income taxes125,183 116,433 398,965 
Depreciation and amortizationDepreciation and amortization252,585 249,572 218,117 
Asset impairmentsAsset impairments— 28,372 — 
Loss (gain) on disposal of fixed assets and other, netLoss (gain) on disposal of fixed assets and other, net5,373 (838)664 
Change in fair value of contingent considerationChange in fair value of contingent consideration14,402 (2,964)5,367 
Investment income and other, netInvestment income and other, net(586)(1,305)(3,086)
Foreign currency (gain) loss on intercompany loansForeign currency (gain) loss on intercompany loans(8,282)3,230 2,854 
Interest expense, netInterest expense, net151,399 106,721 79,496 
Total Reported EBITDATotal Reported EBITDA$540,074 $499,221 $702,377 
2018 2017 2016
Mountain Reported EBITDA$591,605
 $566,338
 $424,415
Mountain Reported EBITDA$550,389 $500,080 $678,594 
Lodging Reported EBITDA25,006
 27,087
 28,169
Lodging Reported EBITDA(5,733)3,269 28,100 
Resort Reported EBITDA616,611
 593,425
 452,584
Resort Reported EBITDA544,656 503,349 706,694 
Real Estate Reported EBITDA957
 (399) 2,784
Real Estate Reported EBITDA(4,582)(4,128)(4,317)
Total Reported EBITDA617,568
 593,026
 455,368
Total Reported EBITDA$540,074 $499,221 $702,377 
Depreciation and amortization(204,462) (189,157) (161,488)
Loss on disposal of fixed assets and other, net(4,620) (6,430) (5,418)
Change in fair value of contingent consideration1,854
 (16,300) (4,200)
Investment income and other, net1,944
 6,114
 723
Foreign currency (loss) gain on intercompany loans(8,966) 15,285
 —
Interest expense, net(63,226) (54,089) (42,366)
Income before benefit (provision) for income taxes340,092
 348,449
 242,619
Benefit (provision) for income taxes61,138
 (116,731) (93,165)
Net income401,230
 231,718
 149,454
Net (income) loss attributable to noncontrolling interests(21,332) (21,165) 300
Net income attributable to Vail Resorts, Inc.$379,898
 $210,553
 $149,754
The following table reconciles long-term debt, net to Net Debt (defined as long-term debt, net plus long-term debt due within one year less cash and cash equivalents) to long-term debt, net (in thousands):
 Year ended July 31,
  
20212020
Long-term debt, net$2,736,175 $2,387,122 
Long-term debt due within one year114,117 63,677 
Total debt2,850,292 2,450,799 
Less: cash and cash equivalents1,243,962 390,980 
Net Debt$1,606,330 $2,059,819 

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 July 31,
  
2018 2017
Long-term debt, net$1,234,277
 $1,234,024
Long-term debt due within one year38,455
 38,397
Total debt1,272,732
 1,272,421
Less: cash and cash equivalents178,145
 117,389
Net Debt$1,094,587
 $1,155,032




Liquidity and Capital Resources
Changes in significant sources and uses of cash for Fiscal 2018,2021, Fiscal 20172020 and Fiscal 20162019 are presented by categories as follows (in thousands):
Year Ended July 31,Year ended July 31,
201820172016202120202019
Net cash provided by operating activities$551,625
$473,189
$436,977
Net cash provided by operating activities$525,250 $394,950 $634,231 
Net cash used in investing activities$(134,579)$(682,836)$(124,016)Net cash used in investing activities$(103,329)$(492,739)$(596,034)
Net cash (used in) provided by financing activities$(350,715)$255,617
$(281,432)
Net cash provided by (used in) financing activitiesNet cash provided by (used in) financing activities$434,662 $376,233 $(99,558)
Historically, we have lower cash available at our fiscal year-end (as well as at the end of oureach first and fourth fiscal quarter of each year)quarter-end as compared to our second and third fiscal quarter-ends, primarily due to the seasonality of our Mountain segment operations.

operations, although our available cash balances as of July 31, 2021 and 2020 were higher than our historical July 31 balance as a result of the various debt offerings we completed in Fiscal 2021 and Fiscal 2020, and our suspension of dividend payments.
Fiscal 20182021 compared to Fiscal 20172020
We generated $551.6$525.3 million of cash from operating activities during Fiscal 2018,2021, an increase of $78.4$130.3 million when compared to $473.2$395.0 million of cash generated during Fiscal 2017.2020. The increase in operating cash flows was primarily a result of improved

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Mountain segment operating results in Fiscal 2018, including operating benefits from the recent acquisitions of Stowe and Whistler Blackcomb, as compared to Fiscal 2017. Additionally, the increase in operating cash flows was a result of(i) an increase in accounts payable and accrued liabilities (excluding accounts payable and accrued liabilities assumed through acquisitions) primarily due to an increase in accrued trade payables, salaries and wages in the current year due to a decreasereturn to more normal operations, as compared to significantly lower accruals in estimated tax paymentsthe prior year due to the Resort Closures; (ii) an increase in pass product sales and collections as compared to the prior year, primarily as a result of the impacts of COVID-19, including the extended pass product sales deadline in the prior year and the impact of the Credit Offer; and (iii) a decrease in inventories (excluding inventories assumed through acquisitions) as of July 31, 2021 as compared to the beginning of the fiscal year relative to an increase in excess tax benefits from employee share awards that vested (restricted stock awards) or were exercised (stock appreciation awards), as applicable, during Fiscal 2018 and the enactment of the Tax Act.prior year period. These increases were partially offset by an increase in cash interest payments of $37.3 million in Fiscal 2021 as compared to the prior year, primarily due to incremental cash interest payments on the 6.25% Notes issued in May 2020, for which the first interest payments were made during Fiscal 20182021.
Cash used in investing activities for Fiscal 2021 decreased by $389.4 million, primarily due to cash payments of $327.6 million, net of cash acquired, related to the acquisition of Peak Resorts during Fiscal 2020. Additionally, capital expenditures decreased by $57.2 million primarily as a result of the deferral of a significant amount of discretionary capital projects related to the Company’s decision during the outbreak of COVID-19 to prioritize near-term liquidity.
Cash provided by financing activities increased by $58.4 million during Fiscal 2021 compared to Fiscal 2020, primarily due to (i) proceeds of $575.0 million from the issuance of our 0.0% Convertible Notes during the Fiscal 2021; (ii) a decrease in dividends paid of $212.7 million; (iii) a decrease in net payments of $208.0 million under the revolver component of our Vail Holdings Credit Agreement; and (iv) a decrease in repurchases of common stock of $46.4 million. These increases were partially offset by (i) proceeds of $600.0 million related to the issuance of our 6.25% Notes during Fiscal 2020; (ii) proceeds of $335.6 million from incremental borrowings under the term loan portion of our Vail Holdings Credit Agreement during Fiscal 2020, which were used to fund the Peak Resorts acquisition; (iii) an increase in net payments under the revolver component of our Whistler Credit Agreement of $23.5 million; and (iv) an increase in employee taxes paid for equity award exercises of $19.6 million.
Fiscal 2020 compared to Fiscal 2019
We generated $395.0 million of cash from operating activities during Fiscal 2020, a decrease of $239.3 million when compared to $634.2 million of cash generated during Fiscal 2019. The decrease in operating cash flows was primarily a result of decreased Mountain and Lodging segment operating results in Fiscal 2020, primarily due to the Resort Closures; a decrease in accounts payable and accrued liabilities due to declines associated with the Resort Closures (excluding accounts payable and accrued liabilities assumed through acquisitions) and an increase in cash interest payments of approximately $17.5 million primarily associated with debt assumed in the Peak Resorts acquisition and incremental term loan and revolver borrowings under our Vail Holdings Credit AgreementAgreement. These decreases were partially offset by increased North American pass product sales and borrowings underreceivable collections for the Whistler Credit Agreement.2019/2020 North American ski season as compared to the prior year and a decrease in estimated tax payments of $23.1 million. Additionally we generated $3.3approximately $4.4 million of proceeds from real estate development land parcel sales duringin Fiscal 20182020 compared to $14.9 million in proceeds (net of sales commissions and deposits previously received) from real estate development project closings that occurred in Fiscal 2017.

Cash used in investing activities for Fiscal 2018 decreased by $548.3 million, primarily due to cash payments during Fiscal 2017 related to the acquisitions of Whistler Blackcomb for $512.3 million, net of cash acquired (cash portion of consideration), and Stowe for $40.7 million, as well as a decrease in capital expenditures of $3.8 million during Fiscal 2018 compared to Fiscal 2017, partially offset by a reduction in cash received from the sale of real property.

Cash used in financing activities increased $606.3 million during Fiscal 2018, compared to Fiscal 2017, primarily due to the reduction of net proceeds from borrowings under our Vail Holdings Credit Agreement during Fiscal 2017, which was used to fund a portion of the cash consideration for the Whistler Blackcomb acquisition. Cash payments made on behalf of employees for taxes related to exercises of share awards increased $87.8 million and dividends paid increased $57.9 million during Fiscal 2018, compared to Fiscal 2017. Additionally, cash outflows related to repurchases of common stock in Fiscal 2018 increased by $25.6 million as compared to Fiscal 2017.

Fiscal 2017 compared to Fiscal 2016
We generated $473.2 million of cash from operating activities during Fiscal 2017, an increase of $36.2 million when compared to $437.0 million of cash generated during Fiscal 2016. The increase in operating cash flows was primarily a result of improved Mountain segment operating results in Fiscal 2017 (including Whistler Blackcomb operations, partially offset by transaction, transition and integration costs) compared to Fiscal 2016. These increases in operating cash inflows were partially offset by an increase in estimated domestic and foreign income tax payments of $27.4 million made during Fiscal 2017 compared Fiscal 2016, a decrease in accounts payable, an increase in cash interest payments due to incremental term loan borrowings under our Vail Holdings Credit Agreement and assumed borrowings under the Whistler Credit Agreement during Fiscal 2017, and receipt of a $4.5 million key money deposit related to the termination of the Half Moon management agreement in Fiscal 2016. Additionally, we generated $14.9 million of proceeds from real estate development project closings during Fiscal 2017 compared to $19.7$0.1 million in proceeds from real estate development project closings that occurred in Fiscal 2016 (each year net of sales commissions and deposits previously received).the prior year.

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Cash used in investing activities increasedfor Fiscal 2020 decreased by $558.8$103.3 million, during Fiscal 2017, primarily due to cash payments of $553.2$327.6 million, net of cash acquired, related to the acquisition of Peak Resorts during Fiscal 2020, as compared to cash payments of $419.0 million, net of cash acquired, related to the acquisitions of Whistler Blackcomb for $512.3 millionTriple Peaks, Stevens Pass, Falls Creek and Stowe for $40.7 million, and an increase inHotham during Fiscal 2019. Additionally, capital expenditures decreased by $19.7 million primarily as a result of $35.2 million during Fiscal 2017. These increases were partially offset byactions associated with the acquisitiondeferral of Wilmot for $20.2 million during Fiscal 2016.

discretionary capital projects related to the Company’s decision to prioritize near-term liquidity.
Cash provided by financing activities increased $537.0by $475.8 million during Fiscal 2017,2020 compared to Fiscal 2019, primarily due to (i) the $600.0 million issuance of the 6.25% Notes in Fiscal 2020; (ii) an increase in proceeds from incremental borrowings under the term loan borrowings under our Vail Holdings Credit Agreement of $509.4 million used to fund a portion of the cash consideration for the Whistler Blackcomb acquisition, partially offset by an increase of $18.8 million in term loan payments during Fiscal 2017, and a decrease in net payments under the revolver portion of our Vail Holdings Credit Agreement of $85.0from $265.5 million during Fiscal 2017. Additionally,2019, which were used to fund the Triple Peaks and Stevens Pass acquisitions, to $335.6 million during Fiscal 2020, which were used to fund the Peak Resorts acquisition; (iii) an increase in Fiscal 2017, we realizednet borrowings under the revolver component of our Whistler Credit Agreement of $24.1 million, primarily relating to funds which were drawn as a $53.6 million reductionprecautionary measure in order to increase our cash position and financial flexibility in light of cash outflows related tothe financial market conditions resulting from the COVID-19 pandemic; (iv) a decrease in repurchases of common stock during Fiscal 2016.of $38.6 million; and (v) a decrease in dividend payments of $47.8 million associated with the Company’s decision to prioritize near-term liquidity. These net increases in cash inflows fromprovided by financing activities were partially offset by (i) an increase in net payments on borrowings under the revolver portioncomponent of the Whistlerour Vail Holdings Credit Agreement of $37.0 million,$286.0 million; (ii) an increase in dividends paidfinancing cost payments of $42.4$8.8 million, during Fiscal 2017 and an increase in cash payments for employee taxes related to exercises of share awards of $6.1 million.

Effect of Adoption of Revised Accounting Guidance and U.S. Tax Reform
As a resultprimarily associated with the issuance of the adoption of revised accounting guidance related6.25% Notes; and (iii) a payment for contingent consideration with regard to employee stock based compensation, we prospectively presented, beginning on August 1, 2017, excess tax benefits from the vesting or exercise of employee awards, as applicable, as operating activities on our Consolidated Statement of Cash Flows. Additionally, as of August 1, 2017, we retrospectively presented cash paid to taxing authorities on an employee’s behalf as financing activities on our Consolidated Statements of Cash Flows, which resulted in decreases of approximately $16.3 million and $10.2 million, respectively, to cash provided by financing activities with a corresponding increase to cash provided by operating activitieslease for Fiscal 2017 and Fiscal 2016, as shown below (in thousands).

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 Fiscal 2017
 Previously Reported (Previous Guidance) Tax Payments Change Revised Reported (New Guidance)
Cash flows provided by operating activities$456,914
 $16,275
 $473,189
Cash flows used in investing activities (no change)(682,836) —
 (682,836)
Cash flows provided by financing activities271,892
 (16,275) 255,617
Effect of exchange rate changes (no change)3,522
 —
 3,522
Net increase in cash and cash equivalents (no change)$49,492
 $—
 $49,492
 Fiscal 2016
 Previously Reported (Previous Guidance) Tax Payments Change Revised Reported (New Guidance)
Cash flows provided by operating activities$426,762
 $10,215
 $436,977
Cash flows used in investing activities (no change)(124,016) —
 (124,016)
Cash flows used in financing activities(271,217) (10,215) (281,432)
Effect of exchange rate changes (no change)909
 —
 909
Net increase in cash and cash equivalents (no change)$32,438
 $—
 $32,438
The adoption of this revised accounting guidance did not have an impact on our total cash flows for Fiscal 2017 or Fiscal 2016.

U.S. Tax Reform
Beginning with our taxable year ending December 31, 2018, we expect to realize an increase in our operating cash flows as a result of the Tax Act, which will reduce our statutory federal corporate income tax rate from 35% to 21%. We expect that incremental cash flows generated from the reduction of the statutory federal corporate income tax rate and the accelerated deductibility of capital expenditures will be approximately $40.0 million in calendar 2018. We plan to use those incremental cash flows to reinvest in wages for our employees, in capital for our resorts and by increasing our return of capital to shareholders.

Park City.
Significant Sources of Cash
We had $178.1$1,244.0 million of cash and cash equivalents as of July 31, 2018,2021, compared to $117.4$391.0 million as of July 31, 2017. We generated $551.6 million of cash from operating activities during Fiscal 2018 compared to $473.2 million and $437.0 million generated during Fiscal 2017 and Fiscal 2016, respectively. We2020. Although we cannot predict the future impact associated with the COVID-19 pandemic on our business, we currently anticipate that our Mountain and Lodging segment operating results will continue to provide a significant source of future operating cash flows (primarily those generated in our second and third fiscal quarters).

In addition to our $178.1$1,244.0 million of cash and cash equivalents at July 31, 2018,2021, we had $185.1$417.7 million available under the revolver component of our Vail Holdings Credit Agreement as of July 31, 20182021 (which represents the total commitment of $400.0$500.0 million less outstanding borrowings of $130.0 million and certain letters of credit outstanding of $84.9$82.3 million). Also, to further support the liquidity needs of Whistler Blackcomb, we had C$214.1243.1 million ($164.6194.9 million) available under the revolver component of our Whistler Credit Agreement (which represents the total commitment of C$300.0 million ($230.7240.5 million) less outstanding borrowings of C$85.056.0 million ($65.444.9 million) and a letter of credit outstanding of C$0.9 million ($0.7 million)). On August 15, 2018, we amended and restated in its entirety our Vail Holdings Credit Agreement. The Amended Vail Holdings Credit Agreement provides for (i) a revolving loan facility in an aggregate principal amount of $400.0 million and (ii) a term loan facility in an aggregate principal amount of up to $950.0 million, increased from the existing term loan facility of $684.4 million as of July 31, 2018. Additionally, key modifications to the Amended Vail Holdings Credit Agreement included, among other things, the extension of the maturity date on the revolving credit facility to August 2023. We expect that our liquidity needs in the near term will be met by continued use of our existing cash and cash equivalents, operating cash flows and borrowings under both the Amended Vail Holdings Credit Agreement and Whistler Credit Agreement.Agreement, if needed. The Amended Vail Holdings Credit Agreement and the Whistler Credit Agreement provide adequate flexibility and are priced favorably with any new borrowings currently priced at LIBOR plus 1.25%2.5% and Bankers Acceptance Rate plus 1.75%2.0%, respectively.


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Significant Uses of Cash
Capital Expenditures
We have historically invested significant amounts of cash in capital expenditures for our resort operations, and we expect to continue to do so, subject to operating performance particularly as it relates to discretionary projects. In addition, we may incur capital expenditures for retained ownership interests associated with third-party real estate development projects. Currently planned capital expenditures primarily include investments that will allow us to maintain our high-quality standards, as well as certain incremental discretionary improvements at our Resorts, and throughout our owned hotels.hotels and in technology that can impact the full network. We evaluate additional discretionary capital improvements based on an expected level of return on investment.

We currently anticipate we will spend approximately $150.0$115 million to $120 million on resort capital expenditures during calendar year 2018,2021, excluding anticipatedone-time items associated with integrations of $5 million and $12 million of reimbursable investments, for U.S. summeras well as real estate related activities andcapital. Including these one-time acquisition and integration relateditems, we expect that our total capital expenditures. This estimated spending includes normal inflation on our capital investments at our resorts.plan will be approximately $135 million to $140 million. Included in these estimated capital expenditures are approximately $80.0$75 million to $80 million of maintenance capital expenditures, which are necessary to maintain appearance and level of service appropriate to our resort operations. Discretionary expenditures expected for calendar year 20182021 include, among other projects, an investmentseveral investments which were previously deferred from calendar year 2020 as a result of approximately $40.0 million (C$52.0 million) at Whistler Blackcomb which will includeCOVID-19, including the 250-acre lift-served terrain expansion in the McCoy Park area of Beaver Creek; a new gondolafour-person high speed lift to serve Peak 7 at Whistler Blackcomb running from the base to the top of Blackcomb Mountain,Breckenridge; replacing the Wizard and Solar four person chairsPeru lift at Keystone with a single state-of-the-art gondola,six-person high speed chairlift; replacing the Peachtree lift at Crested Butte with a new 6 person Emerald chairliftthree-person fixed-grip lift; and an upgraded 4 person Catskinnerupgrade of the four-person Quantum lift at Okemo with a six-person high speed chairlift, relocating the existing four-person Quantum lift to replace the Green Ridge three-person fixed-grip chairlift. We will also be investing in upgrading the fixed grip High Meadow chair at Park City to a four person high speed lift; expanding Cloud Dine restaurant at Park City by adding 200 additional seats and upgrading the Park City Mid-Mountain Lodge; replacing the Galaxy two-person chairlift at Heavenly with a three-person chairlift; and upgrading the Leichhardt T-bar at Perisher to a four-person chairlift. We also expectcontinue to invest approximately $21.0 million in capital expenditures forcompany-wide technology enhancements to support our data driven approach, guest experience
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and corporate infrastructure which improve our scalability and efficiency as we work to optimize our processes, business analytics and cost discipline across the integration of Stevens Pass, Okemo, Mount Sunapee, Crested Butte, Stowe and the completion of Whistler Blackcomb integration,network, as well as approximately $3.0 million in calendar year 2018 for summer investments. Additionally, we planupgrades to invest $35.0 million over the next two years in projects related to Stevens Pass, Okemo, Mount Sunapee and Crested Butte, in addition to an increase in annual ongoing capital expendituresinfrastructure of $7.0 million to support the addition of these four resorts.

Approximately $53.0 million was spent for capital expenditures in calendar year 2018 as of July 31, 2018, leaving approximately $97.0 million to spend in the remainder of calendar year 2018, excluding anticipated investments for U.S. summer related activities and one-time acquisition and integration related capital expenditures.our guest contact centers. We currently plan to utilize cash on hand, borrowings available under our credit agreements and/or cash flow generated from future operations to provide the cash necessary to complete our capital plans.


AcquisitionsApproximately $48 million was spent for capital expenditures in calendar year 2021 as of Stevens Pass, Okemo, Mount Sunapee and Crested Butte
On August 15, 2018, through a wholly-owned subsidiary, we acquired Stevens PassJuly 31, 2021, leaving approximately $87 million to $92 million to spend in the State of Washington from Ski Resort Holdings, LLC for a total purchase price of $64.0 million. We borrowed $70.0 million on August 15, 2018 under the term loan of our Amended Vail Holdings Credit Agreement, as discussed above, primarily to fund the acquisition of Stevens Pass, and borrowed the remainder of the increase to fund the acquisition of Triple Peaks on September 27, 2018, which was acquired for a cash purchase price of approximately $74.0 million, after adjustments for certain agreed-upon terms. In addition, at closing, Triple Peaks paid $155.0 million to pay off the leases that all three resorts had with Ski Resort Holdings, LLC, an affiliate of Oz Real Estate, with funds provided by us. We obtained a new Special Use Permit from the U.S. Forest Service for Crested Butte, and assumed the state land leases for Okemo and Mount Sunapee.

calendar year 2021.
Debt
As of July 31, 2018,2021, principal payments on the majority of our long-term debt ($1,160.5 million2.7 billion of the total $1,276.1 million$2.9 billion debt outstanding as of July 31, 2018)2021) are not due until fiscal year 20222025 and beyond (the maturity date of the Amended Vail Holdings Credit Agreement was extended on August 15, 2018, as discussed above).beyond. As of July 31, 20182021 and 2017,2020, total long-term debt, net (including long-term debt due within one year) was $1,272.7$2,850.3 million and $1,272.4$2,450.8 million, respectively. Net Debt (defined as long-term debt, net plus long-term debt due within one year less cash and cash equivalents) decreased from $1,155.0$2,059.8 million as of July 31, 20172020 to $1,094.6$1,606.3 million as of July 31, 2018,2021, primarily as a result of cash provided by operating activities, as discussed above. See Notes to the Consolidated Financial Statements for additional information.
On December 18, 2020, we entered into the Fourth Amendment to the Vail Holdings Credit Agreement. Pursuant to the Fourth Amendment, among other terms, we are exempt from complying with the Vail Holdings Credit Agreement’s maximum leverage ratio, maximum senior secured leverage ratio and minimum interest coverage ratio financial maintenance covenants for each of the fiscal quarters ending through January 31, 2022 (unless we make a one-time irrevocable election to terminate such exemption period prior to such date), after which we will again be required to comply with such covenants starting with the fiscal quarter ending April 30, 2022 (or such earlier fiscal quarter as elected by us). After the expiration of the Financial Covenants Temporary Waiver Period:
•the maximum ratio permitted under the maximum leverage ratio financial maintenance covenant shall be 6.25 to 1.00;
•the maximum ratio permitted under the senior secured leverage ratio financial maintenance covenant shall be 4.00 to 1.00; and
•the minimum ratio permitted under the minimum interest coverage ratio financial maintenance covenant will be 2.00 to 1.00.

We are also prohibited from the following activities during the Financial Covenants Temporary Waiver Period (unless approval is obtained by a majority of the lenders under the Vail Holdings Credit Agreement):
•paying any dividends or making share repurchases, unless (x) no default or potential default exists under the Vail Holdings Credit Agreement and (y) we have liquidity (as defined below) of at least $300.0 million, and the aggregate amount of dividends paid and share repurchases made by the Company during the Financial Covenants Temporary Waiver Period may not exceed $38.2 million in any fiscal quarter;
•incurring indebtedness secured by the collateral under the Vail Holdings Credit Agreement in an amount in excess of $1.75 billion; and
•making certain non-ordinary course investments in similar businesses, joint ventures and unrestricted subsidiaries unless the Company has liquidity (as defined below) of at least $300.0 million.

The Fourth Amendment also removed certain restrictions under the Financial Covenants Temporary Waiver Period, including (i) removing the restriction on acquisitions so long as we have liquidity (as defined below) of at least $300.0 million and (ii) removing the $200.0 million annual limit on capital expenditures.

We are required to comply with a monthly minimum liquidity test (liquidity is defined as unrestricted cash and temporary cash investments of VRI and its restricted subsidiaries and available commitments under the Vail Holdings Credit Agreement revolver) of not less than $150.0 million, during the period that began July 31, 2020 and ending on the date we deliver a compliance certificate for the Company and its subsidiaries’ first fiscal quarter following the end of the Financial Covenants Temporary Waiver Period.

During the Financial Covenants Temporary Waiver Period, borrowings under the Vail Holdings Credit Agreement, including the term loan facility, bear interest annually at LIBOR plus 2.50% and, for amounts in excess of $400.0 million, LIBOR is subject to a floor of 0.25% (which has decreased from the floor of 0.75% that was in effect prior to the Fourth Amendment).

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On December 18, 2020, we completed our offering of $575.0 million in aggregate principal amount of 0.0% Convertible Notes due 2026 in a private placement conducted pursuant to Rule 144A of the Securities Act. The 0.0% Convertible Notes were issued under an increaseIndenture dated December 18, 2020 (the “Indenture”) between us and U.S. Bank National Association, as Trustee. The 0.0% Convertible Notes do not bear regular interest and the principal amount does not accrete. The 0.0% Convertible Notes mature on January 1, 2026, unless earlier repurchased, redeemed or converted.

The 0.0% Convertible Notes are our general senior unsecured obligations. The 0.0% Convertible Notes rank senior in right of payment to any future debt that is expressly subordinated, equal in right of payment with our existing and future liabilities that are not so subordinated, and are subordinated to all of our existing and future secured debt to the extent of the value of the assets securing such debt. The 0.0% Convertible Notes will also be structurally subordinated to all of the existing and future liabilities and obligations of our subsidiaries, including such subsidiaries’ guarantees of the 6.25% Notes.

The initial conversion rate was 2.4560 shares per $1,000 principal amount of notes (the “Conversion Rate”), which represents an initial conversion price of approximately $407.17 per share (the “Conversion Price”), and is subject to adjustment upon the occurrence of certain specified events as described in the Indenture. The principal amount of the 0.0% Convertible Notes is required to be settled in cash. We will settle conversions by paying cash, delivering shares of our common stock, or a combination of the two, at our option.

Holders may convert their notes, at their option, only under the following circumstances:
•during any calendar quarter commencing after the calendar quarter ending on March 31, 2021 if the last reported sale price per share of our common stock exceeds 130% of the Conversion Price for each of at least 20 trading days (whether or not consecutive) during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter;
•during the five consecutive business days immediately after any 10 consecutive trading day period (such 10 consecutive trading day period, the “Measurement Period”) in which the trading price per $1,000 principal amount of notes for each trading day of the Measurement Period was less than 98% of the product of the last reported sale price per share of our common stock on such trading day and the Conversion Rate on such trading day;
•upon the occurrence of certain corporate events or distributions on our common stock, as described in the Indenture;
•if we call the 0.0% Convertible Notes for redemption; or
•at any time from, and including, July 1, 2025 until the close of business on the scheduled trading day immediately before the maturity date.

The 0.0% Convertible Notes will be redeemable, in whole or in part, at our option at any time, and from time to time, on or after January 1, 2024 and on or before the 25th scheduled trading day immediately before the maturity date, at a cash redemption price equal to the principal amount of the notes to be redeemed, plus accrued and unpaid special and additional interest, if any, to, but excluding, the redemption date, but only if the last reported sale price per share of our common stock exceeds 130% of the Conversion Price for a specified period of time. If we elect to redeem less than all of the 0.0% Convertible Notes, at least $50.0 million aggregate principal amount of notes must be outstanding and not subject to redemption as of the relevant redemption notice date. Calling any 0.0% Convertible Notes for redemption will constitute a make-whole fundamental change with respect to such notes, in which case the Conversion Rate applicable to the conversion of such notes will be increased in certain circumstances if such notes are converted after they are called for redemption.

In addition, upon the occurrence of a fundamental change (as defined in the Indenture), holders of the 0.0% Convertible Notes may require us to repurchase all or a portion of their notes at a cash repurchase price equal to the principal amount of the notes to be repurchased, plus any accrued and unpaid special and additional interest, if any, to, but excluding, the applicable repurchase date. If certain fundamental changes referred to as make-whole fundamental changes (as defined in the Indenture) occur, the Conversion Rate for the 0.0% Convertible Notes may be increased for a specified period of time.

The Indenture includes customary events of default, including failure to make payment, failure to comply with the obligations set forth in the Indenture, certain defaults on certain other indebtedness, and certain events of bankruptcy, insolvency or reorganization. We may elect, at our option, that the sole remedy for an event of default relating to certain failures by the Company to comply with certain reporting covenants in the Indenture will consist exclusively of the right of the holders of the 0.0% Convertible Notes to receive additional interest on the notes for up to 360 days following such failure.
As of July 31, 2021, the Vail Holdings Credit Agreement provides for (i) a revolving loan facility in an aggregate principal amount of $500.0 million and (ii) a term loan facility of $1.1 billion. We expect that our liquidity needs in the near term will be
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met by continued use of our existing cash and cash equivalents. In addition, we exercised our rightequivalents, operating cash flows and borrowings under the Vail Holdings Credit Agreement and the Whistler Credit Agreement, with the consent of the lender parties thereto, to extend the maturity date of our Whistler Credit Agreement to November 2022 during Fiscal 2018. There were no other changes to the terms of the Whistler Credit Agreement.

if needed.
Our debt service requirements can be impacted by changing interest rates as we had $932.3 millionapproximately $0.8 billion of net variable-rate debt outstanding as of July 31, 2018.2021, after consideration of $400.0 million in interest rate swaps which convert variable-rate debt to fixed-rate debt. A 100-basis point change in LIBOR would cause our annual interest payments on our net variable-rate debt to change by approximately $9.3$8.4 million. Additionally, the annual payments associated with the financing of the Canyons transaction increase by the greater of CPI less 1%, or 2%. The fluctuation in our debt service requirements, in addition to interest rate and inflation changes, may be impacted by future borrowings under our credit agreements or other alternative financing arrangements we may enter into. Our

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long term liquidity needs depend upon operating results that impact the borrowing capacity under our credit agreements, which can be mitigated by adjustments to capital expenditures, the flexibility of investment activities and the ability to obtain favorable future financing. We can respond to liquidity impacts of changes in the business and economic environment, including the COVID-19 pandemic, by managing our capital expenditures, variable operating expenses, the timing of new real estate development activity and the payment of our regular quarterly cash dividend ofdividends on our common stock.

Share Repurchase Program
Our share repurchase program is conducted under authorizations made from time to time by our Board of Directors. On March 6, 2006, our Board of Directors initially authorized the repurchase of up to 3,000,000 shares of Vail Resorts common stock (“Vail Shares”) and later authorized additional repurchases of up to 3,000,000 additional Vail Shares (July 16, 2008) and 1,500,000 Vail Shares (December 4, 2015), for a total authorization to repurchase shares of up to 7,500,000 Vail Shares. During Fiscal 2018,2021, we repurchased 115,422 shares of common stock at a cost of $25.8 million.did not repurchase any Vail Shares. Since the inception of this stock repurchase program through July 31, 2018,2021, we have repurchased 5,551,7166,161,141 Vail Shares at a cost of approximately $273.0$404.4 million. As of July 31, 2018, 1,948,2842021, 1,338,859 Vail Shares remained available to repurchase under the existing repurchase authorization. Pursuant to the Third Amendment and as discussed above, we are prohibited from repurchasing shares of common stock during the Financial Covenants Temporary Waiver Period unless (x) no default or potential default exists under the Vail Holdings Credit Agreement and (y) the Company has liquidity (as defined above) of at least $300.0 million, and the aggregate amount of dividends paid and share repurchases made by the Company during the Financial Covenants Temporary Waiver Period may not exceed $38.2 million in any fiscal quarter. Vail Shares purchased pursuant to the repurchase program will be held as treasury shares and may be used for the issuance of shares under the Company’s share award plan. Repurchases under the program may be made from time to time at prevailing prices as permitted by applicable laws, and subject to market conditions and other factors. The timing, as well as the number of Vail Shares that may be repurchased under the program, will depend on several factors, including our future financial performance, our available cash resources and competing uses for cash that may arise in the future, the restrictions in our Vail Holdings Credit Agreement, prevailing prices of Vail Shares and the number of Vail Shares that become available for sale at prices that we believe are attractive. The share repurchase program has no expiration date.

Dividend Payments
InWe announced on April 1, 2020 that we would be suspending the declaration of our quarterly dividend in response to the COVID-19 pandemic. Additionally, pursuant to the Fourth Amendment, we are prohibited from paying any dividends during the Financial Covenants Temporary Waiver Period unless (x) no default or potential default exists under the Vail Holdings Credit Agreement and (y) the Company has liquidity (as defined above) of at least $300.0 million, and the aggregate amount of dividends paid and share repurchases made by the Company during the Financial Covenants Temporary Waiver Period may not exceed $38.2 million in any fiscal year 2011, our Board of Directors approved the commencement of a regular quarterlyquarter. During Fiscal 2021, we did not pay cash dividend on our common stock at an annual rate of $0.60 per share, subject to quarterly declaration. Since the initial commencement of a regular quarterly cash dividend, our Board of Directors has annually approved an increase to our cash dividend on our common stock and on March 7, 2018,dividends. On September 22, 2021, our Board of Directors approved a 40% increase in our quarterly cash dividend to $1.47of $0.88 per share (or approximately $59.6 million per quarter based upon shares outstandingpayable on October 22, 2021 to stockholders of record as of July 31, 2018). ForOctober 5, 2021. Additionally, a Canadian dollar equivalent dividend on the year ended July 31, 2018, we paid cash dividendsExchangeco Shares will be payable on October 22, 2021 to the shareholders of $5.046 per share ($204.2 million inrecord as of October 5, 2021. We expect to fund the aggregate.) These dividends were funded throughdividend with available cash on hand and borrowingwill do so pursuant to the restrictions under the revolving portion of our Vail Holdings Credit Agreement. Subject to the discretion of our Board of Directors, applicable law and contractual restrictions, we anticipate paying regular quarterly cash dividends on our common stock for the foreseeable future.Financial Covenants Temporary Waiver Period. The amount, if any, of the dividends to be paid in the future will depend on our available cash on hand, anticipated cash needs, overall financial condition, restrictions contained in our Amended Vail Holdings Credit Agreement, future prospects for earnings and cash flows, as well as other factors considered relevant by our Board of Directors.

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Covenants and Limitations
We must abide by certain restrictive financial covenants under our credit agreements. The most restrictive of those covenants include the following covenants:following: for the Amended Vail Holdings Credit Agreement, Net Funded Debt to Adjusted EBITDA ratio, Secured Net Funded Debt to Adjusted EBITDA ratio and the Interest Coverage ratio (each as defined in the Vail Holdings Credit Agreement) and; for the Whistler Credit Agreement, Consolidated Total Leverage Ratio and Consolidated Interest Coverage Ratio (each as defined in the Whistler Credit Agreement); and for the EPR Secured Notes, Maximum Leverage Ratio and Consolidated Fixed Charge Ratio (each as defined in the EPR Agreements). In addition, our financing arrangements limit our ability to make certain restricted payments, pay dividends on or redeem or repurchase stock, make certain investments, make certain affiliate transfers and may limit our ability to enter into certain mergers, consolidations or sales of assets and incur certain indebtedness. Our borrowing availability under the Amended Vail Holdings Credit Agreement is primarily determined by the Net Funded Debt to Adjusted EBITDA ratio, which is based on our segment operating performance, as defined in the Amended Vail Holdings Credit Agreement. Our borrowing availability under the Whistler Credit Agreement is primarily determined based on the commitment size of the credit facility and our compliance with the terms of the Whistler Credit Agreement.


Pursuant to the Fourth Amendment and as discussed above in further detail, we are exempt from complying with the restrictive financial covenants of the Vail Holdings Credit Agreement during the Financial Covenants Temporary Waiver Period, but are required to comply with a monthly minimum liquidity test during such period (as discussed above).
We were in compliance with all restrictive financial covenants in our debt instruments as of July 31, 2018.2021. We expect that we will continue to meet all applicable financial maintenance covenants in effect in our credit agreements throughout the year ending July 31, 2019. However,2022; however, there can be no assurance that we will continue to meet such financial covenants. If such covenants are not met, we would be required to seek a waiver or amendment from the banks participating in our credit agreements. There can be no assurance that such waiver or amendment would be granted, which could have a material adverse impact on our liquidity.


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Contractual Obligations
As part of our ongoing operations, we enter into arrangements that obligate us to make future payments under contracts such as debt agreements, lease agreements and construction agreements in conjunction with our resort capital expenditures. Debt obligations, which totaled $1,276.1 million$2.9 billion as of July 31, 2018,2021, are recognized as liabilities in our Consolidated Balance Sheet. Obligations under construction contracts and other purchase commitments are not recognized as liabilities in our Consolidated Balance Sheet until services and/or goods are received which is in accordance with GAAP. Additionally, operating lease and service contract obligations, which totaled $359.1 million as of July 31, 2018, are not recognized as liabilities in our Consolidated Balance Sheet, which is in accordance with GAAP. A summary of our contractual obligations as of July 31, 20182021 is presented below (in thousands):
  Payments Due by Period
  Fiscal2-34-5More than
Contractual ObligationsTotal2022yearsyears5 years
Long-Term Debt (Outstanding Principal) (1)
$2,948,514 $121,345 $127,538 $2,174,189 $525,442 
Fixed Rate Interest (1)
350,352 56,388 112,873 57,790 123,301 
Canyons Obligation (2)
1,543,186 30,093 62,003 64,508 1,386,582 
Operating Leases and Service Contracts (3)
321,653 68,273 79,521 64,796 109,063 
Purchase Obligations and Other (4)
538,284 434,269 80,903 12 23,100 
Total Contractual Cash Obligations$5,701,989 $710,368 $462,838 $2,361,295 $2,167,488 
(1)    The fixed-rate interest payments (including payments that are required under interest rate swaps that we have entered into) as well as long-term debt payments, included in the table above, assume that all debt outstanding as of July 31, 2020 will be held to maturity. Interest payments associated with variable-rate debt have not been included in the table. Assuming that our approximately $0.8 billion of variable-rate long-term debt as of July 31, 2021 is held to maturity and utilizing interest rates in effect at July 31, 2021, our annual interest payments (including commitment fees and letter of credit fees) on variable rate long-term debt as of July 31, 2021 is anticipated to be approximately $23.6 million for Fiscal 2022, approximately $21.9 million for fiscal year 2023 and approximately $10.4 million for at least each of the next three years subsequent to fiscal year 2023. The future annual interest obligations noted herein are estimated only in relation to debt outstanding as of July 31, 2021 and do not reflect interest obligations on potential future debt.
Included in Long-Term Debt (Outstanding Principal) are $11.7 million of proceeds resulting from real estate transactions accounted for as a financing arrangements. Fiscal 2022 payments shown above include approximately $6.2 million of proceeds, which are expected to be recognized on the Company’s Statement of Operations during Fiscal 2022 as a result of
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   Payments Due by Period
   Fiscal 2-3 4-5 More than
Contractual ObligationsTotal 2019 years years 5 years
Long-Term Debt (Outstanding Principal) (1)
$1,276,082
 $38,455
 $77,096
 $769,595
 $390,936
Fixed Rate Interest (1)
1,480
 227
 406
 336
 511
Canyons Obligation (2)
1,645,267
 27,708
 57,089
 59,395
 1,501,075
Operating Leases and Service Contracts (3)
359,116
 57,320
 80,198
 66,188
 155,410
Purchase Obligations and Other (4)
455,396
 348,652
 83,137
 420
 23,187
Total Contractual Cash Obligations$3,737,341
 $472,362
 $297,926
 $895,934
 $2,071,119
(1)The fixed-rate interest payments, as well as long-term debt payments, included in the table above, assume that all debt outstanding as of July 31, 2018 will be held to maturity. Interest payments associated with variable-rate debt have not been included in the table. Assuming that our $932.3 million of variable-rate long-term debt as of July 31, 2018 is held to maturity and utilizing interest rates in effect at July 31, 2018, our annual interest payments (including commitment fees and letter of credit fees) on variable rate long-term debt as of July 31, 2018 is anticipated to be approximately $29.8 million for Fiscal 2019, approximately $28.6 million for Fiscal 2020 and approximately $27.4 million for at least each of the next three years subsequent to Fiscal 2020. The future annual interest obligations noted herein are estimated only in relation to debt outstanding as of July 31, 2018 and do not reflect interest obligations on potential future debt.
(2)Reflects interest expense payments associated with the remaining lease term of the Canyons obligation, initially 50 years, assuming a 2% per annum (floor) increase in payments. Any potential increases to the annual fixed payment above the 2% floor due to inflation linked index of CPI less 1% have been excluded.
(3)The payments under noncancelable operating leases included in the table above reflect the applicable minimum lease payments and exclude any potential contingent rent payments.
(4)Purchase obligations and other primarily include amounts which are classified as trade payables, accrued payroll and benefits, accrued fees and assessments, contingent consideration liability, accrued taxes (including taxes for uncertain tax positions) on our Consolidated Balance Sheet as of July 31, 2018; and, other commitments for goods and services not yet received, including construction contracts and minimum commitments under season pass alliance agreements, not included on our Consolidated Balance Sheet as of July 31, 2018 in accordance with GAAP.

the anticipated resolution of continuing involvement, with no associated cash outflow (see Notes to Consolidated Financial Statements for additional information).
(2)    Reflects interest expense payments associated with the remaining lease term of the Canyons obligation, initially 50 years, assuming a 2% per annum (floor) increase in payments. Any potential increases to the annual fixed payment above the 2% floor due to inflation linked index of CPI less 1% have been excluded.
(3)    The payments under noncancelable operating leases included in the table above reflect the applicable minimum lease payments and exclude any potential contingent rent payments.
(4)    Purchase obligations and other primarily include amounts which are classified as trade payables ($98.3 million), accrued payroll and benefits ($101.7 million), accrued fees and assessments ($21.2 million), contingent consideration liability ($29.6 million), and accrued taxes (including taxes for uncertain tax positions) ($123.6 million) on our Consolidated Balance Sheet as of July 31, 2021; and, other commitments for goods and services not yet received, including construction contracts and minimum commitments under season pass alliance agreements, not included on our Consolidated Balance Sheet as of July 31, 2021 in accordance with GAAP.
Off Balance Sheet Arrangements
We do not have off balance sheet transactions that are expected to have a material effect on our financial condition, revenue, expenses, results of operations, liquidity, capital expenditures or capital resources.

Critical Accounting Policies
The preparation of Consolidated Financial Statements in conformity with GAAP requires us to select appropriate accounting policies and to make judgments and estimates affecting the application of those accounting policies. In applying our accounting policies, different business conditions or the use of different assumptions may result in materially different amounts reported in the Consolidated Financial Statements.
We have identified the most critical accounting policies which were determined by considering accounting policies that involve the most complex or subjective decisions or assessments. We also have other policies considered key accounting policies; however, these policies do not meet the definition of critical accounting policies because they do not generally require us to make estimates

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or judgments that are complex or subjective. We have reviewed these critical accounting policies and related disclosures with our Audit Committee of the Board of Directors.
Goodwill and Intangible Assets
Description
The carrying value of goodwill and indefinite-lived intangible assets are evaluated for possible impairment on an annual basis or between annual tests if an event occurs or circumstances change that would more likely than not reduce the estimated fair value of a reporting unit or indefinite-lived intangible asset below its carrying value. Other intangible assets are evaluated for impairment only when there is evidence that events or changes in circumstances indicate that the carrying amount of these assets may not be recoverable.
Judgments and Uncertainties
Application of the goodwill and indefinite-lived intangible asset impairment test requires judgment, including the identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to reporting units and determination of the estimated fair value of reporting units and indefinite-lived intangible assets. We perform a qualitative analysis to determine whether it is more likely than not that the fair value of a reporting unit or indefinite-lived intangible asset exceeds the carrying amount. If it is determined, based on qualitative factors, that the fair value of the reporting unit or indefinite-lived intangible asset may be more likely than not less than carrying amount, or if significant changes to macro-economic factors related to the reporting unit or intangible asset have occurred that could materially impact fair value since the previous quantitative analysis was performed, a quantitative impairment test would be required, in which we would determine the estimated fair value of our reporting units using a discounted cash flow analysis. Theanalysis and determine the estimated fair value of indefinite-lived intangible assets is primarily determined using the income approach based upon estimated future revenue streams. These analyses require significant judgments, including estimation of future cash flows, which is dependent on internal forecasts, available industry/market data (to the extent available), estimation of the long-term rate of growth for our business including expectations and assumptions regarding the impact of general economic conditions on our business, estimation of the useful life over which cash flows will occur (including terminal multiples), determination of the respective weighted average cost of
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capital and market participant assumptions. Changes in these estimates and assumptions could materially affect the determination of estimated fair value and impairment for each reporting unit or indefinite-lived intangible asset. We evaluate our reporting units on an annual basis and allocate goodwill to our reporting units based on the reporting units expected to benefit from the acquisition generating the goodwill.
Effect if Actual Results Differ From Assumptions
Goodwill and indefinite-lived intangible assets are tested for impairment at least annually as of May 1. Based upon our annualOur testing for goodwill and indefinite-lived intangible asset impairment test performed during the fourth fiscal quarterconsists of Fiscal 2018,a comparison of the estimated fair value of those assets with their net carrying values. If the net carrying value of the assets exceed their estimated fair value, an impairment will be recognized for indefinite-lived intangible assets, including goodwill, in an amount equal to that excess; otherwise, no impairment loss is recognized. During Fiscal 2021, we performed quantitative analyses of our reporting units and indefinite-lived intangible assets were in excessand determined that the estimated fair value of all material reporting units and indefinite-lived intangible assets significantly exceeded their respective carrying values, and as such no impairment of goodwill or indefinite-lived intangible assets existed.values.
Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions and factors. As a result, there can be no assurance that the estimates and assumptions made for purposes of the annual goodwill impairment test will prove to be an accurate prediction of the future. Examples of events or circumstances that could reasonably be expected to negatively affect the underlying key assumptions and ultimately impact the estimated fair value of our reporting units may include such items as: (1) prolonged adverse weather conditions resulting in a sustained decline in guest visitation; (2) a prolonged weakness in the general economic conditions in which guest visitation and spending is adversely impacted;impacted (particularly with regard to the ongoing COVID-19 pandemic); and (3) volatility in the equity and debt markets which could result in a higher discount rate.
While historical performance and current expectations have generally resulted in estimated fair values of our reporting units in excess of carrying values, if our assumptions are not realized, it is possible that an impairment charge may need to be recorded in the future. However, it is not possible at this time to determine if an impairment charge would result or if such a charge would be material. As of July 31, 2018,2021, we had $1,475.7$1,781.0 million of goodwill and $221.5$256.6 million of indefinite-lived intangible assets recorded on our Consolidated Balance Sheet. There can be no assurance that the estimates and assumptions made for purposes of the annual goodwill and indefinite-lived intangible asset impairment tests for goodwill will prove to be an accurate prediction of the future.

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Tax Contingencies
Description
We must make certain estimates and judgments in determining income tax expense for financial statement purposes. These estimates and judgments occur in the calculation of tax credits and deductions and in the calculation of certain tax assets and liabilities, which arise from differences in the timing of recognition of revenue and expense for tax and financial statement purposes, as well as the interest and penalties relating to uncertain tax positions. The calculation of our tax liabilities involves dealing with uncertainties in the application of complex tax regulations, including those enacted under the Tax Act.regulations. We recognize liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step requires us to estimate and measure the largest tax benefit that is cumulatively greater than 50% likely of being realized upon ultimate settlement. It is inherently difficult and subjective to estimate such amounts, as this requires us to determine the probability of various possible outcomes. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law, interpretation of tax law, effectively settled issues under audit and new audit activity. A significant amount of time may pass before a particular matter, for which we may have established a reserve, is audited and fully resolved.
Judgments and Uncertainties
The estimates of our tax contingencies reserve contain uncertainty because management must use judgment to estimate the potential exposure associated with our various filing positions.
Effect if Actual Results Differ From Assumptions
We believe the estimates and judgments discussed herein are reasonable and we have adequate reserves for our tax contingencies for uncertain tax positions. Our reserves for uncertain tax positions, including any income tax related interest and penalties ($83.474.8 million as of July 31, 2018)2021), relate to the treatment of the TaliskerCanyons lease payments obligation as payments of debt obligations and that the tax basis in Canyons goodwill is deductible. Actual results could differ and we may be exposed to increases or decreases in those reserves and tax provisions that could be material.
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An unfavorable tax settlement could require the use of cash and could possibly result in increased tax expense and effective tax rate and/or adjustments to our deferred tax assets and deferred tax liabilities in the year of resolution. A favorable tax settlement could possibly result in a reduction in our tax expense, effective tax rate, income taxes payable, other long-term liabilities and/or adjustments to our deferred tax assets and deferred tax liabilities in the year of settlement or in future years.
Depreciable Lives of Assets
Description
Mountain and lodging operational assets, furniture and fixtures, computer equipment, software, vehicles and leasehold improvements are primarily depreciated using the straight-line method over the estimated useful life of the asset. Assets may become obsolete or require replacement before the end of their useful life in which the remaining book value would be written-off or we could incur costs to remove or dispose of assets no longer in use.
Judgments and Uncertainties
The estimates of our useful lives of the assets contain uncertainty because management must use judgment to estimate the useful life of the asset.
Effect if Actual Results Differ From Assumptions
Although we believe the estimates and judgments discussed herein are reasonable, actual results could differ, and we may be exposed to increased expense related to depreciable assets disposed of, removed or taken out of service prior to its originally estimated useful life, which may be material. A 10% decrease in the estimated useful lives of depreciable assets would have increased depreciation expense by approximately $15.9$24.0 million for Fiscal 2018.

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2021.
Business Combinations
Description
A component of our growth strategy has been to acquire and integrate businesses that complement our existing operations. We account for business combinations in accordance with the guidance for business combinations and related literature. Accordingly, we allocate the purchase price of acquired businesses to the identifiable tangible and intangible assets acquired and liabilities assumed based upon their estimated fair values at the date of acquisition. The difference between the purchase price and the estimated fair value of the net assets acquired or the excess of the aggregate estimated fair values of assets acquired and liabilities assumed is recorded as goodwill. In determining the estimated fair values of assets acquired and liabilities assumed in a business combination, we use various recognized valuation methods including present value modeling and referenced market values (where available). Valuations are performed by management or independent valuation specialists under management’s supervision, where appropriate.
Judgments and Uncertainties
Accounting for business combinations requires our management to make significant estimates and assumptions, especially at the acquisition date, including our estimates for intangible assets, contractual obligations assumed and contingent consideration, where applicable. Although we believe the assumptions and estimates we have made in the past have been reasonable and appropriate, they are based in part on historical experience and information obtained from the management of the acquired companies and are inherently uncertain. Examples of critical estimates in valuing certain of the intangible assets we have acquired include but are not limited to determination of weighted average cost of capital, market participant assumptions, royalty rates, terminal multiples and estimates of future cash flows to be generated by the acquired assets. In addition to the estimates and assumptions applied to valuing intangible assets acquired, the determination of the estimated fair value of contingent consideration, including estimating the likelihood and timing of achieving the relevant thresholds for contingent consideration payments, requires the use of subjective judgments. We estimate the fair value of the Park City contingent consideration payments using an option pricing valuation model which incorporates, among other factors, projected achievement of specified financial performance measures, discounts rates volatility, credit risk and estimation of the long-term rate of growthvolatility for the respective business.
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Effect if Actual Results Differ From Assumptions
We believe that the estimated fair values assigned to the assets acquired and liabilities assumed are based on reasonable assumptions that a marketplace participant would use. While we use our best estimates and assumptions to accurately value assets acquired and liabilities assumed at the acquisition date, our estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, we may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the estimated fair values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments would be recorded in our Consolidated Statements of Operations.
We recognize the fair value of contingent consideration at the date of acquisition as part of the consideration transferred to acquire a business. The liability associated with contingent consideration is remeasured to fair value at each reporting period subsequent to the date of acquisition taking into consideration changes in financial projections and long-term growth rates, among other factors, that may impact the timing and amount of contingent consideration payments until the term of the agreement has expired or the contingency is resolved. Increases in the fair value of contingent consideration are recorded as losses in our Consolidated Statements of Operations, while decreases in fair value are recorded as gains.
New Accounting Standards
Refer to the Summary of Significant Accounting Policies within the Notes to Consolidated Financial Statements for a discussion of new accounting standards.

Inflation
Although we cannot accurately determine the precise effect of inflation on our operations, management does not believe inflation has had a material effect on the results of operations in the last three fiscal years. When the costs of operating resorts increase, we generally have been able to pass the increase on to our customers. However, there can be no assurance that increases in labor and other operating costs due to inflation will not have an impact on our future profitability.
In May 2013, we entered into a long-term lease pursuant to which we assumed the operations of Canyons which includes the ski terrain and related amenities. The lease has an initial term of 50 years with six 50-year renewal options. The lease provides for $25.0 million in annual payments, which increase each year by an inflation linked index of CPI less 1%, with a floor of 2% per annum. As lease payments increase annually, there can be no assurance that these increases will be offset by increased cash flow generated from operations at Park City.

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Seasonality and Quarterly Results
Our mountain and lodging operations are seasonal in nature. In particular, revenue and profits for our North America mountain and most of our lodging operations are substantially lower and historically result in losses from late spring to late fall. Conversely, peak operating seasons for our NPS concessionaire properties, our mountain resort golf courses and Perisher’sour Australian resorts’ ski season generally occur during the North American summer months while the North American winter months result in operating losses. Revenue and profits generated by NPS concessionaire properties summer operations, golf operations and Perisher’sAustralian resorts’ ski operations are not sufficient to fully offset our off-season losses from our North American mountain and other lodging operations. During Fiscal 2018, 78%2021, approximately 82% of total combined Mountain and Lodging segment net revenue (excluding Lodging segment revenue associated with reimbursement of payroll costs) was earned during the second and third fiscal quarters. Therefore, the operating results for any three-month period are not necessarily indicative of the results that may be achieved for any subsequent quarter or for a full year (see Notes to Consolidated Financial Statements).

ITEM 7A.         QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Interest Rate Risk. Our exposure to market risk is limited primarily to the fluctuating interest rates associated with variable rate indebtedness. At July 31, 2018,2021, we had $932.3 millionapproximately $0.8 billion of net variable rate indebtedness (after taking into consideration $400.0 million in interest rate swaps which converts variable-rate debt to fixed-rate debt), representing approximately 73%28% of our total debt outstanding, at an average interest rate during Fiscal 20182021 of approximately 2.8%. Based on variable-rate borrowings outstanding as of July 31, 2018,2021, a 100-basis point (or 1.0%) change in LIBOR would result in our annual interest payments on our net variable-rate debt changing by $9.3$8.4 million. Our market risk exposure fluctuates based on changes in underlying interest rates.

Foreign Currency Exchange Rate Risk. We are exposed to currency translation risk because the results of our international entities are reported in local currency, which we then translate to U.S. dollars for inclusion in our consolidated financial statements.Consolidated Financial Statements. As a result, changes between the foreign exchange rates, in particular the Canadian dollar and Australian dollar compared to the U.S. dollar, affect the amounts we record for our foreign assets, liabilities, revenues and expenses, and could have a negative effect on our financial results. Additionally, we have foreign currency transaction exposure from an intercompany loan to Whistler Blackcomb that is not deemed to be permanently invested, which has and could materially change due to fluctuations in the Canadian dollar exchange rate. The results of Whistler Blackcomb and Perisherour Australian ski areas are reported in Canadian dollars and Australian dollars respectively, which we then translate to U.S. dollars for inclusion in our consolidated financial statements.Consolidated Financial Statements. We do not currently enter into hedging arrangements to minimize the impact of foreign currency fluctuations on our operations.

64



The following table summarizes the amounts of foreign currency translation adjustments, net of tax, representing gains (losses), and foreign currency gain (loss) gain on intercompany loans recognized in comprehensive income (in thousands):
Year ended July 31,
202120202019
Foreign currency translation adjustments$100,019 $(9,075)$(34,287)
Foreign currency gain (loss) on intercompany loans$8,282 $(3,230)$(2,854)

65
 Year Ended July 31,
 2018 2017
Foreign currency translation adjustments, net of tax$(61,957) $64,152
Foreign currency (loss) gain on intercompany loans$(8,966) $15,285


58








ITEM 8.FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
ITEM 8.FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
Vail Resorts, Inc.
Consolidated Financial Statements for the Years Ended July 31, 2018, 20172021, 2020 and 20162019
 

6067
6168
Consolidated Financial Statements
Consolidated Balance Sheets
6370
Consolidated Statements of Operations
6471
Consolidated Statements of Comprehensive Income
6572
Consolidated Statements of Stockholders’ Equity
6673
Consolidated Statements of Cash Flows
6774
Notes to Consolidated Financial Statements
6875


59
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Management’s Report on Internal Control over Financial Reporting
Management of Vail Resorts, Inc. (the “Company”) is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Securities Exchange Act of 1934. The Company’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States of America.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of the effectiveness of internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Management, including the Company’s Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of the Company’s internal control over financial reporting as of July 31, 2018.2021. In making this assessment, management used the criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013. Based on this assessment, management concluded that, as of July 31, 2018,2021, the Company’s internal control over financial reporting was effective.
The Company’s independent registered public accounting firm, PricewaterhouseCoopers LLP, has issued an attestation report on the effectiveness of the Company’s internal control over financial reporting as of July 31, 2018,2021, as stated in the Report of Independent Registered Public Accounting Firm on the following page.

67
60








Report of Independent Registered Public Accounting Firm

TotheBoard of Directors and Stockholders
of Vail Resorts, Inc.

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Vail Resorts, Inc.and its subsidiaries(the “Company”) as of July 31, 2018 2021and July 31, 2017,2020,and the related consolidated statements of operations, of comprehensive income, of stockholders’ equity and of cash flows for each of the three years in the period ended July 31, 2018,2021, including the related notes (collectively referred to as the “consolidated financial statements”).We also have audited the Company's internal control over financial reporting as of July 31, 2018,2021, based on criteria established in Internal Control - Integrated Framework(2013)issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).


In our opinion, the consolidatedfinancial statements referred to above present fairly, in all material respects, the financial position of the Company as of July 31, 2018 2021and July 31, 20172020, and the results of their itsoperations and their itscash flows for each of the three years in the period ended July 31, 2018 2021in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of July 31, 2018,2021, based on criteria established in Internal Control - Integrated Framework(2013)issued by the COSO.


Change in Accounting Principle
As discussed in Note 2 to the consolidated financial statements, the Company changed the manner in which it accounts for leases as of August 1, 2019.
Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanyingManagement’s Report on Internal Control over Financial Reporting. Our responsibility is to express opinions on the Company’s consolidatedfinancial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB")(PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.


We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidatedfinancial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.


Our audits of the consolidatedfinancial statements included performing procedures to assess the risks of material misstatement of the consolidatedfinancial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidatedfinancial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidatedfinancial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.


Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the
68



company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.


Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matters


61The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.




Fair Value Measurement of the Contingent Consideration



As described in Note10to the consolidatedfinancial statements, the Company has established a liability of $29.6 million as of July 31, 2021 for additional amounts that management believes are likely to be paid to the previous owner of Park City (the “Contingent Consideration”). The Company remeasures the Contingent Consideration to fair value at each reporting date until the contingency is resolved. The estimated fair value of Contingent Consideration includes the future period resort operations of Park City in the calculation of EBITDA on which participating contingent payments are made, which is determined on the basis of estimated subsequent year performance, escalated by an assumed long-term growth factor and discounted to net present value. Fair value is estimated using an option pricing valuation model. As described by management, key assumptions in determining the fair value under this model included future period Park City EBITDA, discount rate and volatility.

The principal considerations for our determination that performing procedures relating to the fair value measurement of the Contingent Consideration is a critical audit matter are (i) the significant judgment by management when developing the fair value measurement, which in turn led to a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating audit evidence related to management’s significant assumptions for the future period Park City EBITDA, discount rate, and volatility; and (ii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to management’s fair value measurement of the Contingent Consideration including controls over the Company’s significant assumptions. The procedures also included, among others, testing management’s process for developing the fair value measurement and evaluating the significant assumptions used by management, related to the future period Park City EBITDA, discount rate, and volatility. Evaluating management’s assumptions related to the future period Park City EBITDA, discount rate, and volatility involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past period EBITDA performance of Park City; (ii) the consistency with external market data; and (iii) whether these assumptions were consistent with evidence obtained in other areas of the audit. Professionals with specialized skill and knowledge were used to assist in the evaluation of the Company’s discount rate and volatility assumptions.



/s/ PricewaterhouseCoopers LLP
Denver, Colorado
September 27, 201823, 2021


We have served as the Company’s auditor since 2002.



62
69








Vail Resorts, Inc.
Consolidated Balance Sheets
(In thousands, except per share amounts)


July 31,
July 31,
20182017
20212020
Assets Assets
Current assets: Current assets:
Cash and cash equivalents$178,145
$117,389
Cash and cash equivalents$1,243,962 $390,980 
Restricted cash6,895
10,273
Restricted cash14,612 11,106 
Accounts receivable, net of allowances of $1,278 and $750, respectively230,829
186,913
Inventories, net of reserves of $1,534 and $1,518, respectively85,588
84,814
Accounts receivable, net of allowances of $7,621 and $2,484, respectivelyAccounts receivable, net of allowances of $7,621 and $2,484, respectively345,408 106,664 
Inventories, net of reserves of $2,601 and $4,447, respectivelyInventories, net of reserves of $2,601 and $4,447, respectively80,316 101,856 
Other current assets37,279
33,681
Other current assets61,288 54,482 
Total current assets538,736
433,070
Total current assets1,745,586 665,088 
Property, plant and equipment, net (Note 6)1,627,219
1,714,154
Real estate held for sale and investment99,385
103,405
Property, plant and equipment, net (Note 8)Property, plant and equipment, net (Note 8)2,067,876 2,192,679 
Real estate held for sale or investmentReal estate held for sale or investment95,615 96,844 
Goodwill, net (Note 8)Goodwill, net (Note 8)1,781,047 1,709,020 
Intangible assets, net (Note 8)Intangible assets, net (Note 8)319,110 314,776 
Operating right-of-use assets (Note 4)Operating right-of-use assets (Note 4)204,716 225,744 
Deferred charges and other assets43,386
45,414
Deferred charges and other assets37,106 40,081 
Goodwill, net (Note 6)1,475,686
1,519,743
Intangible assets, net (Note 6)280,572
294,932
Total assets$4,064,984
$4,110,718
Total assets$6,251,056 $5,244,232 
Liabilities and Stockholders’ Equity Liabilities and Stockholders’ Equity
Current liabilities: Current liabilities:
Accounts payable and accrued liabilities (Note 6)$504,533
$467,669
Accounts payable and accrued liabilities (Note 8)Accounts payable and accrued liabilities (Note 8)$815,472 $499,108 
Income taxes payable50,632
98,491
Income taxes payable48,812 40,680 
Long-term debt due within one year (Note 4)38,455
38,397
Long-term debt due within one year (Note 6)Long-term debt due within one year (Note 6)114,117 63,677 
Total current liabilities593,620
604,557
Total current liabilities978,401 603,465 
Long-term debt, net (Note 4)1,234,277
1,234,024
Other long-term liabilities (Note 6)291,506
301,736
Deferred income taxes (Note 9)133,918
171,442
Long-term debt, net (Note 6)Long-term debt, net (Note 6)2,736,175 2,387,122 
Operating lease liabilities (Note 4)Operating lease liabilities (Note 4)190,561 217,542 
Other long-term liabilitiesOther long-term liabilities264,034 270,245 
Deferred income taxes, net (Note 11)Deferred income taxes, net (Note 11)252,817 234,191 
Total liabilities2,253,321
2,311,759
Total liabilities4,421,988 3,712,565 
Commitments and contingencies (Note 11)



Commitments and contingencies (Note 13)Commitments and contingencies (Note 13)0
Stockholders’ equity: Stockholders’ equity:
Preferred stock, $0.01 par value, 25,000 shares authorized, no shares issued and outstanding—
—
Preferred stock, $0.01 par value, 25,000 shares authorized, no shares issued and outstanding— — 
Common stock, $0.01 par value, 100,000 shares authorized and 46,021 and 45,448 shares issued, respectively460
454
Exchangeable shares, $0.01 par value, 58 and 69 shares issued and outstanding, respectively (Note 5)1
1
Common stock, $0.01 par value, 100,000 shares authorized and 46,552 and 46,350 shares issued, respectivelyCommon stock, $0.01 par value, 100,000 shares authorized and 46,552 and 46,350 shares issued, respectively466 464 
Exchangeable shares, $0.01 par value, 34 and 36 shares issued and outstanding, respectively (Note 5)Exchangeable shares, $0.01 par value, 34 and 36 shares issued and outstanding, respectively (Note 5)— — 
Additional paid-in capital1,137,467
1,222,510
Additional paid-in capital1,196,993 1,131,624 
Accumulated other comprehensive (loss) income(2,227)44,395
Accumulated other comprehensive income (loss)Accumulated other comprehensive income (loss)27,799 (56,837)
Retained earnings726,722
550,985
Retained earnings773,752 645,902 
Treasury stock, at cost; 5,552 and 5,436 shares, respectively (Note 14)(272,989)(247,189)
Treasury stock, at cost; 6,161 and 6,161 shares, respectively (Note 16)Treasury stock, at cost; 6,161 and 6,161 shares, respectively (Note 16)(404,411)(404,411)
Total Vail Resorts, Inc. stockholders’ equity1,589,434
1,571,156
Total Vail Resorts, Inc. stockholders’ equity1,594,599 1,316,742 
Noncontrolling interests222,229
227,803
Noncontrolling interests234,469 214,925 
Total stockholders’ equity1,811,663
1,798,959
Total stockholders’ equity1,829,068 1,531,667 
Total liabilities and stockholders’ equity$4,064,984
$4,110,718
Total liabilities and stockholders’ equity$6,251,056 $5,244,232 
The accompanying Notes are an integral part of these consolidated financial statements.


Consolidated Financial Statements.
63
70








Vail Resorts, Inc.
Consolidated Statements of Operations
(In thousands, except per share amounts)
Year Ended July 31, Year Ended July 31,
201820172016
202120202019
Net revenue: Net revenue:
Mountain and Lodging services and other$1,584,310
$1,477,654
$1,228,716
Mountain and Lodging services and other$1,650,055 $1,578,463 $1,807,930 
Mountain and Lodging retail and dining423,255
412,646
350,442
Mountain and Lodging retail and dining257,885 380,394 462,933 
Resort net revenue2,007,565
1,890,300
1,579,158
Resort net revenue1,907,940 1,958,857 2,270,863 
Real Estate3,988
16,918
22,128
Real Estate1,770 4,847 712 
Total net revenue2,011,553
1,907,218
1,601,286
Total net revenue1,909,710 1,963,704 2,271,575 
Operating expense (exclusive of depreciation and amortization shown separately below): Operating expense (exclusive of depreciation and amortization shown separately below):
Mountain and Lodging operating expense966,566
891,135
775,590
Mountain and Lodging operating expense960,453 1,019,437 1,101,670 
Mountain and Lodging retail and dining cost of products sold174,105
170,824
143,276
Mountain and Lodging retail and dining cost of products sold112,536 159,066 190,044 
General and administrative251,806
236,799
208,991
General and administrative296,993 278,695 274,415 
Resort operating expense1,392,477
1,298,758
1,127,857
Resort operating expense1,369,982 1,457,198 1,566,129 
Real Estate, net3,546
24,083
24,639
Real EstateReal Estate6,676 9,182 5,609 
Total segment operating expense1,396,023
1,322,841
1,152,496
Total segment operating expense1,376,658 1,466,380 1,571,738 
Other operating (expense) income: Other operating (expense) income:
Depreciation and amortization(204,462)(189,157)(161,488)Depreciation and amortization(252,585)(249,572)(218,117)
Gain on sale of real property515
6,766
5,295
Gain on sale of real property324 207 580 
Change in fair value of contingent consideration (Note 8)1,854
(16,300)(4,200)
Loss on disposal of fixed assets and other, net(4,620)(6,430)(5,418)
Asset impairments (Notes 2 & 8)Asset impairments (Notes 2 & 8)— (28,372)— 
Change in fair value of contingent consideration (Note 10)Change in fair value of contingent consideration (Note 10)(14,402)2,964 (5,367)
(Loss) gain on disposal of fixed assets and other, net(Loss) gain on disposal of fixed assets and other, net(5,373)838 (664)
Income from operations408,817
379,256
282,979
Income from operations261,016 223,389 476,269 
Interest expense, netInterest expense, net(151,399)(106,721)(79,496)
Mountain equity investment income, net1,523
1,883
1,283
Mountain equity investment income, net6,698 1,690 1,960 
Investment income and other, net1,944
6,114
723
Investment income and other, net586 1,305 3,086 
Foreign currency (loss) gain on intercompany loans (Note 4)(8,966)15,285
—
Interest expense, net(63,226)(54,089)(42,366)
Income before benefit (provision) for income taxes340,092
348,449
242,619
Benefit (provision) for income taxes (Note 9)61,138
(116,731)(93,165)
Foreign currency gain (loss) on intercompany loans (Note 6)Foreign currency gain (loss) on intercompany loans (Note 6)8,282 (3,230)(2,854)
Income before provision for income taxesIncome before provision for income taxes125,183 116,433 398,965 
Provision for income taxes (Note 11)Provision for income taxes (Note 11)(726)(7,378)(75,472)
Net income401,230
231,718
149,454
Net income124,457 109,055 323,493 
Net (income) loss attributable to noncontrolling interests(21,332)(21,165)300
Net loss (income) attributable to noncontrolling interestsNet loss (income) attributable to noncontrolling interests3,393 (10,222)(22,330)
Net income attributable to Vail Resorts, Inc.$379,898
$210,553
$149,754
Net income attributable to Vail Resorts, Inc.$127,850 $98,833 $301,163 
Per share amounts (Note 3): 
Per share amounts (Note 5):Per share amounts (Note 5):
Basic net income per share attributable to Vail Resorts, Inc.$9.40
$5.36
$4.13
Basic net income per share attributable to Vail Resorts, Inc.$3.17 $2.45 $7.46 
Diluted net income per share attributable to Vail Resorts, Inc.$9.13
$5.22
$4.01
Diluted net income per share attributable to Vail Resorts, Inc.$3.13 $2.42 $7.32 
Cash dividends declared per share$5.046
$3.726
$2.865
Cash dividends declared per share$— $5.28 $6.46 
The accompanying Notes are an integral part of these consolidated financial statements.

Consolidated Financial Statements.
64
71








Vail Resorts, Inc.
Consolidated Statements of Comprehensive Income
(In thousands)




Year Ended July 31,Year Ended July 31,
201820172016 202120202019
Net income$401,230
$231,718
$149,454
Net income$124,457 $109,055 $323,493 
Foreign currency translation adjustments and other (net of tax of $1,981, ($2,831) and ($1,905), respectively)(61,957)64,152
3,363
Foreign currency translation adjustmentsForeign currency translation adjustments100,019 (9,075)(34,287)
Change in estimated fair value of hedging instruments, net of taxChange in estimated fair value of hedging instruments, net of tax12,817 (22,510)— 
Comprehensive income339,273
295,870
152,817
Comprehensive income237,293 77,470 289,206 
Comprehensive (income) loss attributable to noncontrolling interests(5,997)(39,372)300
Comprehensive income attributable to noncontrolling interestsComprehensive income attributable to noncontrolling interests(24,807)(3,744)(17,546)
Comprehensive income attributable to Vail Resorts, Inc.$333,276
$256,498
$153,117
Comprehensive income attributable to Vail Resorts, Inc.$212,486 $73,726 $271,660 
The accompanying Notes are an integral part of these consolidated financial statements.Consolidated Financial Statements.



65
72










Vail Resorts, Inc.
Consolidated Statements of Stockholders’ Equity
(In thousands, except share amounts)
 Common Stock
Additional
Paid in
Capital
Accumulated Other Comprehensive Income (Loss)
Retained
Earnings
Treasury
Stock
Total Vail Resorts, Inc. Stockholders’ Equity
Noncontrolling
Interests
Total
Stockholders’
Equity
 Vail ResortsExchangeable
  
 
  
  
  
  
  
Balance, July 31, 2015$415
$—
$623,510
$(4,913)$440,748
$(193,192)$866,568
$14,018
$880,586
Comprehensive income (loss):         
Net income (loss)—
—
—
—
149,754
—
149,754
(300)149,454
Foreign currency translation adjustments and other, net of tax—
—
—
3,363
—
—
3,363
—
3,363
Total comprehensive income (loss)      153,117
(300)152,817
Stock-based compensation (Note 15)—
—
17,025
—
—
—
17,025
—
17,025
Issuance of shares under share award plan, net of shares withheld for employee taxes (Note 15)1
—
(10,216)—
—
—
(10,215)—
(10,215)
Tax benefit from share award plan—
—
5,667
—
—
—
5,667
—
5,667
Repurchases of common stock (Note 14)—
—
—
—
—
(53,787)(53,787)—
(53,787)
Dividends (Note 3)—
—
—
—
(103,835)—
(103,835)—
(103,835)
Contributions from noncontrolling interests, net—
—
—
—
—
—
—
208
208
Balance, July 31, 2016416
—
635,986
(1,550)486,667
(246,979)874,540
13,926
888,466
Comprehensive income:         
Net income—
—
—
—
210,553
—
210,553
21,165
231,718
Foreign currency translation adjustments, net of tax—
—
—
45,945
—
—
45,945
18,207
64,152
Total comprehensive income      256,498
39,372
295,870
Stock-based compensation (Note 15)—
—
18,315
—
—
—
18,315
—
18,315
Shares issued for acquisition (Note 5)33
4
574,608
—
—
—
574,645
—
574,645
Exchangeable share transfers3
(3)—
—
—
—
—
—
—
Issuance of shares under share award plan, net of shares withheld for employee taxes (Note 15)2
—
(16,277)—
—
—
(16,275)—
(16,275)
Tax benefit from share award plan—
—
9,878
—
—
—
9,878
—
9,878
Repurchases of common stock (Note 14)—
—
—
—
—
(210)(210)—
(210)
Dividends (Note 3)—
—
—
—
(146,235)—
(146,235)—
(146,235)
Acquisition of noncontrolling interest (Note 5)—
—
—
—
—
—
—
182,579
182,579
Distributions to noncontrolling interests, net—
—
—
—
—
—
—
(8,074)(8,074)
Balance, July 31, 2017454
1
1,222,510
44,395
550,985
(247,189)1,571,156
227,803
1,798,959
Comprehensive income:         
Net income—
—
—
—
379,898
—
379,898
21,332
401,230
Foreign currency translation adjustments, net of tax—
—
—
(46,622)—
—
(46,622)(15,335)(61,957)
Total comprehensive income      333,276
5,997
339,273
Stock-based compensation (Note 15)—
—
19,040
—
—
—
19,040
—
19,040
Measurement period adjustment (Note 5)—
—
—
—
—
—
—
(1,776)(1,776)
Issuance of shares under share award plan, net of shares withheld for employee taxes (Note 15)6
—
(104,083)—
—
—
(104,077)—
(104,077)
Repurchases of common stock (Note 14)—
—
—
—
—
(25,800)(25,800)—
(25,800)
Dividends (Note 3)—
—
—
—
(204,161)—
(204,161)—
(204,161)
Distributions to noncontrolling interests, net—
—
—
—
—
—
—
(9,795)(9,795)
Balance, July 31, 2018$460
$1
$1,137,467
$(2,227)$726,722
$(272,989)$1,589,434
$222,229
$1,811,663
 Common StockAdditional
Paid in
Capital		Accumulated Other Comprehensive (Loss) IncomeRetained
Earnings		Treasury
Stock		Total Vail Resorts, Inc. Stockholders’ EquityNoncontrolling
Interests		Total
Stockholders’
Equity
 Vail ResortsExchangeable
  
  
  
  
  
  
Balance, July 31, 2018$460 $1 $1,137,467 $(2,227)$726,722 $(272,989)$1,589,434 $222,229 $1,811,663 
Comprehensive income:
Net income— — — — 301,163 — 301,163 22,330 323,493 
Foreign currency translation adjustments— — — (29,503)— — (29,503)(4,784)(34,287)
Total comprehensive income271,660 17,546 289,206 
Stock-based compensation expense (Note 17)— — 19,856 — — — 19,856 — 19,856 
Cumulative effect for adoption of revenue standard— — — — (7,517)— (7,517)— (7,517)
Issuance of shares under share award plan, net of shares withheld for employee taxes (Note 17)1 — (27,240)— — — (27,239)— (27,239)
Repurchases of common stock (Note 16)— — — — — (85,000)(85,000)— (85,000)
Dividends (Note 5)— — — — (260,567)— (260,567)— (260,567)
Distributions to noncontrolling interests, net— — — — — — — (13,562)(13,562)
Balance, July 31, 2019461 1 1,130,083 (31,730)759,801 (357,989)1,500,627 226,213 1,726,840 
Comprehensive income:
Net income— — — — 98,833 — 98,833 10,222 109,055 
Foreign currency translation adjustments— — — (2,597)— — (2,597)(6,478)(9,075)
Change in estimated fair value of hedging instruments, net of tax— — — (22,510)— — (22,510)— (22,510)
Total comprehensive income73,726 3,744 77,470 
Stock-based compensation expense (Note 17)— — 21,021 — — — 21,021 — 21,021 
Issuance of shares under share award plan, net of shares withheld for employee taxes (Note 17)2 — (19,480)— — — (19,478)— (19,478)
Exchangeable share transfers1 (1)— — — — — — — 
Repurchases of common stock (Note 16)— — — — — (46,422)(46,422)— (46,422)
Dividends (Note 5)— — — — (212,732)— (212,732)— (212,732)
Distributions to noncontrolling interests, net— — — — — — — (15,032)(15,032)
Balance, July 31, 2020464 — 1,131,624 (56,837)645,902 (404,411)1,316,742 214,925 1,531,667 
Comprehensive income:
Net income (loss)— — — — 127,850 — 127,850 (3,393)124,457 
Foreign currency translation adjustments— — — 71,819 — — 71,819 28,200 100,019 
Change in estimated fair value of hedging instruments, net of tax— — — 12,817 — — 12,817 — 12,817 
Total comprehensive income212,486 24,807 237,293 
Equity component of 0.0% Convertible Notes, net (Note 6)— — 80,066 — — — 80,066 — 80,066 
Stock-based compensation expense (Note 17)— — 24,395 — — — 24,395 — 24,395 
Issuance of shares under share award plan, net of shares withheld for employee taxes (Note 17)2 — (39,092)— — — (39,090)— (39,090)
Distributions to noncontrolling interests, net— — — — — — — (5,263)(5,263)
Balance, July 31, 2021$466 $— $1,196,993 $27,799 $773,752 $(404,411)$1,594,599 $234,469 $1,829,068 
The accompanying Notes are an integral part of these consolidated financial statements.

Consolidated Financial Statements.
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Vail Resorts, Inc.
Consolidated Statements of Cash Flows
(In thousands)
Year Ended July 31, Year Ended July 31,
201820172016 202120202019
Cash flows from operating activities: Cash flows from operating activities:
Net income$401,230
$231,718
$149,454
Net income$124,457 $109,055 $323,493 
Adjustments to reconcile net income to net cash provided by operating activities: Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization204,462
189,157
161,488
Depreciation and amortization252,585 249,572 218,117 
Asset impairmentsAsset impairments— 28,372 — 
Cost of real estate sales3,701
13,097
15,724
Cost of real estate sales— 3,684 — 
Stock-based compensation expense19,040
18,315
17,025
Stock-based compensation expense24,395 21,021 19,856 
Deferred income taxes, net(45,770)36,437
7,626
Deferred income taxes, net(16,136)17,435 22,419 
Canyons obligation accreted interest expense5,723
5,687
5,644
Change in fair value of contingent consideration(1,854)16,300
4,200
Foreign currency loss (gain) on intercompany loans8,966
(15,285)—
Gain on sale of real property(515)(6,766)(5,295)
Other non-cash income, net(13,784)(15,063)(8,044)
Other non-cash expense (income), netOther non-cash expense (income), net12,544 (10,842)(482)
Changes in assets and liabilities, net of effects of acquisitions: Changes in assets and liabilities, net of effects of acquisitions:
Restricted cash3,139
2,206
6,966
Accounts receivable, net(44,261)(36,291)(32,991)Accounts receivable, net(237,188)167,347 (35,406)
Inventories, net(963)8,086
(843)Inventories, net22,781 (1,924)(7,274)
Accounts payable and accrued liabilities1,879
(22,119)16,025
Accounts payable and accrued liabilities118,979 (82,394)23,296 
Deferred revenue42,007
24,217
36,557
Deferred revenue199,410 (98,003)35,628 
Income taxes payable - excess tax benefit from share award plans(71,077)(9,878)(5,667)Income taxes payable - excess tax benefit from share award plans(18,096)(8,236)(12,932)
Income taxes payable - other38,453
27,954
62,220
Income taxes payable - other29,946 (4,951)38,773 
Other assets and liabilities, net1,249
5,417
6,888
Other assets and liabilities, net11,573 4,814 8,743 
Net cash provided by operating activities551,625
473,189
436,977
Net cash provided by operating activities525,250 394,950 634,231 
Cash flows from investing activities: Cash flows from investing activities:
Capital expenditures(140,611)(144,432)(109,237)Capital expenditures(115,097)(172,334)(192,035)
Acquisition of businesses, net of cash acquired(1,356)(553,220)(20,245)Acquisition of businesses, net of cash acquired— (327,555)(419,044)
Cash received from sale of real property515
7,992
7,386
Other investing activities, net6,873
6,824
(1,920)Other investing activities, net11,768 7,150 15,045 
Net cash used in investing activities(134,579)(682,836)(124,016)Net cash used in investing activities(103,329)(492,739)(596,034)
Cash flows from financing activities: Cash flows from financing activities:
Proceeds from borrowings under Vail Holdings Credit Agreement225,000
669,375
210,000
Proceeds from borrowings under Vail Holdings Credit Agreement— 892,625 543,625 
Proceeds from borrowings under Whistler Credit Agreement46,513
16,917
—
Proceeds from borrowings under Whistler Credit Agreement27,775 209,634 26,518 
Proceeds from borrowings under 0.0% Convertible NotesProceeds from borrowings under 0.0% Convertible Notes575,000 — — 
Proceeds from borrowings under 6.25% NotesProceeds from borrowings under 6.25% Notes— 600,000 — 
Repayments of borrowings under Vail Holdings Credit Agreement(182,500)(213,125)(329,375)Repayments of borrowings under Vail Holdings Credit Agreement(62,500)(811,875)(235,625)
Repayments of borrowings under Whistler Credit Agreement(91,941)(53,889)—
Repayments of borrowings under Whistler Credit Agreement(45,657)(204,032)(45,060)
Employee taxes paid for share award exercises(104,077)(16,275)(10,215)Employee taxes paid for share award exercises(39,090)(19,478)(27,239)
Repurchases of common stock(25,800)(210)(53,787)Repurchases of common stock— (46,422)(85,000)
Dividends paid(204,161)(146,235)(103,835)Dividends paid— (212,732)(260,567)
Other financing activities, net(13,749)(941)5,780
Other financing activities, net(20,866)(31,487)(16,210)
Net cash (used in) provided by financing activities(350,715)255,617
(281,432)
Effect of exchange rate changes on cash and cash equivalents(5,575)3,522
909
Net increase in cash and cash equivalents60,756
49,492
32,438
Cash and cash equivalents: 
Net cash provided by (used in) financing activitiesNet cash provided by (used in) financing activities434,662 376,233 (99,558)
Effect of exchange rate changes on cash, cash equivalents and restricted cashEffect of exchange rate changes on cash, cash equivalents and restricted cash(95)5,253 (5,290)
Net increase (decrease) in cash and cash equivalentsNet increase (decrease) in cash and cash equivalents856,488 283,697 (66,651)
Cash, cash equivalents and restricted cash:Cash, cash equivalents and restricted cash:
Beginning of period$117,389
$67,897
$35,459
Beginning of period$402,086 $118,389 $185,040 
End of period$178,145
$117,389
$67,897
End of period$1,258,574 $402,086 $118,389 
Cash paid for interest$53,842
$46,454
$33,243
Cash paid for interest$125,667 $88,398 $70,888 
Taxes paid, net$16,945
$49,373
$21,994
Taxes paid, net$5,011 $4,134 $27,212 
Non-cash investing activities: Non-cash investing activities:
Accrued capital expenditures$15,638
$14,631
$16,267
Accrued capital expenditures$5,158 $15,046 $18,420 
The accompanying Notes are an integral part of these consolidated financial statements.

Consolidated Financial Statements.
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Notes to Consolidated Financial Statements

1.Organization and Business

Vail Resorts, Inc. (“Vail Resorts”) is organized as a holding company and operates through various subsidiaries. Vail Resorts and its subsidiaries (collectively, the “Company”) operate in three business segments: Mountain, Lodging and Real Estate. The Company refers to “Resort” as the combination of the Mountain and Lodging segments.

In the Mountain segment, as of July 31, 2018, the Company operated elevenoperates the following 37 destination mountain resorts and regional ski areas:
mtn-20210731_g2.jpg
*Denotes a destination mountain resort, properties and three urbanwhich generally receives a meaningful portion of skier visits from long-distance travelers, as opposed to the Company’s regional ski areas, including:
Mountain Resorts:Location:
1.Vail Mountain Resort (“Vail Mountain”)Colorado
2.Breckenridge Ski Resort (“Breckenridge”)Colorado
3.Keystone Resort (“Keystone”)Colorado
4.Beaver Creek Resort (“Beaver Creek”)Colorado
5.Park City Resort (“Park City”)Utah
6.Heavenly Mountain Resort (“Heavenly”)Lake Tahoe area of Nevada and California
7.Northstar Resort (“Northstar”)Lake Tahoe area of California
8.Kirkwood Mountain Resort (“Kirkwood”)Lake Tahoe area of California
9.Perisher Ski Resort (“Perisher”)New South Wales, Australia
10.Whistler Blackcomb Resort (“Whistler Blackcomb”)British Columbia, Canada
11.Stowe Mountain Resort (“Stowe”)Vermont
Urban Ski Areas (“Urban”):Location:
1.Wilmot Mountain (“Wilmot”)Wisconsin
2.Afton Alps Ski Area (“Afton Alps”)Minnesota
3.Mount Brighton Ski Area (“Mt. Brighton”)Michigan

which tend to generate skier visits predominantly from their respective local markets.
Additionally, the Mountain segment includes ancillary services, primarily including ski school, dining and retail/rental operations, and for Perisherthe Company’s Australian ski areas, including lodging and transportation operations. TheSeveral of the resorts located in the United States (“U.S.”), except for Northstar, Park City, Stowe and the Urban ski areas, operate primarily on federal land under the terms of Special Use Permits granted by the U.S. Department of Agriculture Forest Service. The operations of Whistler Blackcomb are conducted on land owned by the government of the Province of British Columbia, Canada within the traditional territory of the Squamish and Lil’wat Nations. The operations of Perisherthe Company’s Australian ski areas are conducted pursuant to a long-term leaseleases and licenselicenses on land owned by the governmentgovernments of New South Wales and Victoria, Australia. Okemo, Mount Sunapee and Stowe operatesoperate on land leased from the respective states in which the resorts are located and on land owned by the Company as well as land it leases from the states the resorts operate in.

Company.
In the Lodging segment, the Company owns and/or manages a collection of luxury hotels and condominiums under its RockResorts brand, as well asbrand; other strategic lodging properties and a large number of condominiums located in proximity to the Company’s North American mountain resorts,resorts; National Park Service (“NPS”) concessionaire properties including the Grand Teton Lodge Company (“GTLC”), which operates destination resorts in Grand Teton National Park,Park; a Colorado resort ground transportation company and mountain resort golf courses.

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Vail Resorts Development Company (“VRDC”), a wholly-owned subsidiary, conducts the operations of the Company’s Real Estate segment, which owns, develops and sells real estate in and around the Company’s resort communities.

The Company’s mountain business and its lodging properties at or around the Company’s mountain resorts are seasonal in nature with peak operating seasons primarily from mid-November through mid-April in North America. The Company’speak operating season at Perisher, itsthe Company’s Australian resorts, NPS concessionaire properties and its golf courses generally occuroccurs from June to early October.

2. Summary of Significant Accounting Policies
2.Summary of Significant Accounting Policies
Principles of Consolidation--Consolidation — The accompanying Consolidated Financial Statements include the accounts of the Company and its consolidated subsidiaries for which the Company has a controlling financial interest. Investments in which the Company does not have a controlling financial interest, but has significant influence, are accounted for under the equity method. All significant intercompany transactions have been eliminated in consolidation.

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Cash and Cash Equivalents--Equivalents — The Company considers all highly liquid investments with maturities of three months or less at the date of purchase to be cash equivalents.

Restricted Cash — The Company considers cash to be restricted when withdrawal or general use is legally restricted.
Accounts receivable-- — The Company records trade accounts receivable in the normal course of business related to the sale of products or services. The allowance for doubtful accounts is based on a specific reserve analysis and on a percentage of accounts receivable and takes into consideration such factors as historical write-offs, the economic climate and other factors that could affect collectability. Write-offs are evaluated on a case by case basis.
Inventories--Inventories — The Company’s inventories consist primarily of purchased retail goods, food and beverage items and spare parts. Inventories are stated at the lower of cost or net realizable value, determined using primarily an average weighted cost method. The Company records a reserve for estimated shrinkage and obsolete or unusable inventory.
Property, Plant and Equipment--Equipment — Property, plant and equipment is carried at cost net of accumulated depreciation. Repairs and maintenance are expensed as incurred. Expenditures that improve the functionality of the related asset or extend the useful life are capitalized. When property, plant and equipment is retired or otherwise disposed of, the related gain or loss is included in operating income.income from operations. Leasehold improvements are amortized on the straight-line method over the shorter of the remaining lease term or estimated useful life of the asset. Depreciation is calculated on the straight-line method, including property, plant and equipment under capitalfinance leases, generally based on the following useful lives:
Estimated Life

in Years
Land improvements10-35
Buildings and building improvements7-30
Machinery and equipment2-30
Furniture and fixtures3-10
Software3
Vehicles3-10

Real Estate Held for Sale andor Investment-- — The Company capitalizes as real estate held for sale andor investment the original land acquisition cost, direct construction and development costs, property taxes, interest recorded on costs related to real estate under development and other related costs. Sales and marketing expenses are charged against income in the period incurred. Additionally, sales commission expenses are charged against income in the period that the related revenue from real estate sales is recorded.
Deferred Financing Costs--Costs — Certain costs incurred with the issuance of debt and debt securities are capitalized and included as a reduction in the net carrying value of long-term debt, net of accumulated amortization, with the exception of costs incurred related to line-of-credit arrangements, which are included in deferred charges and other assets, net of accumulated amortization. Amortization is chargedof such deferred financing costs are recorded to interest expense, net on the Company’s Consolidated Statements of Operations over the respective term of the applicable debt issues.instruments. When debt is extinguished prior to its maturity date, the amortization of the remaining unamortized deferred financing costs, or pro-rata portion thereof, is charged to loss on extinguishment of debt.
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Goodwill and Intangible Assets-- — The Company has classified as goodwill the cost in excess of estimated fair value of the net assets of businesses acquired in purchase transactions. The Company’s major intangible asset classes are trademarks, water rights, customer lists, property management contracts and Forest Service permits and excess reorganization value.permits. Goodwill and various indefinite-lived intangible assets, including excess reorganization value, certain trademarks, water rights and certain property management contracts, are not amortized but are subject to at least annual impairment testing. The Company tests these non-amortizing assets annually (or more often, if necessary) for impairment as of May 1. Amortizable intangible assets are amortized over the shorter of their contractual terms or estimated useful lives.
For the testing of goodwill and other indefinite-lived intangible assets for impairment, the Company may perform a qualitative analysis to determine whether it is more likely than not that the fair value of a reporting unit or indefinite-lived intangible asset exceeds the carrying amount, which includes an evaluation as to whether there have been significant changes to macro-economic factors related to the reporting unit or intangible asset that could materially impact fair value. If it is determined, based on qualitative factors, that the fair value of the reporting unit or indefinite-lived intangible asset is more likely than not less than carrying amount, or if significant changes to macro-economic factors related to the reporting unit or intangible asset have occurred that could materially impact estimated fair values since the previous quantitative analysis was performed, a quantitative impairment test would be required, in which the Company would determine the estimated fair value of its reporting units using discounted cash flow analyses and determine the estimated fair value of its indefinite-lived intangible assets using an income approach. The testingquantitative test for impairment consists of a comparison of the estimated fair value of the assets with their net carrying values. If the net carrying amount of the assets exceed its estimated fair value, an impairment will be recognized for indefinite-lived intangibles, including goodwill, in an amount equal to that excess. If the net carrying amount of the assets does not exceed the estimated fair value, no impairment loss is recognized. For the testing of goodwill for impairment, the Company performs a qualitative analysis to determine whether it is more likely than not that the fair value of a reporting unit exceeds the carrying amount. If it is determined, based on qualitative factors, that the fair value of the reporting unit may be more likely than not less than carrying amount, or if significant changes to macro-economic factors related to the reporting unit have occurred that could materially impact fair value, a quantitative goodwill impairment test would be required, in which the Company determines the estimated fair value of its reporting units using discounted cash flow analyses. The estimated fair value of indefinite-lived intangible assets is estimated

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using an income approach. The Company determined that there waswere no impairment toimpairments of goodwill or definite and no significant impairment to definite or indefinite-lived intangible assets for the years ended July 31, 2018, 20172021 and 2016.2019. As a result of COVID-19 and the impact it has had on the Company’s operations during the year ended July 31, 2020, the Company determined that the estimated fair value of its Colorado resort ground transportation company reporting unit within its Lodging segment no longer exceeded its carrying value. As further discussed in Note 8, Supplementary Balance Sheet Information, the Company recognized an impairment of approximately $28.4 million related to its Colorado resort ground transportation company during the year ended July 31, 2020, which was recorded within asset impairments on the Company’s Consolidated Statement of Operations, with a corresponding reduction to goodwill, net of $25.7 million and to intangible assets, net and property, plant and equipment, net of $2.7 million. See Note 8, Supplementary Balance Sheet Information, for additional information. The Company determined that there were no other impairments of goodwill or definite and indefinite-lived assets for the year ended July 31, 2020.
Long-lived Assets--Assets — The Company evaluates potential impairment of long-lived assets and long-lived assets to be disposed of whenever events or changes in circumstances indicate that the net carrying amount of an asset may not be fully recoverable. If the sum of the expected cash flows, on an undiscounted basis, is less than the net carrying amount of the asset, an impairment loss is recognized in the amount by which the net carrying amount of the asset exceeds its estimated fair value. The Company does not believe any events or changes in circumstances indicating an impairmentdetermined that there were no impairments of the net carrying amount of a long-lived asset occurred duringassets for the years ended July 31, 2018, 20172021 and 2016.
Revenue Recognition--2019. As discussed above, the Company recorded an impairment to long-lived assets related to its Colorado resort ground transportation company during the year ended July 31, 2020. The following describes the compositionCompany determined that there were no other impairments of revenueslong-lived assets for the Company:
Mountain revenue is derived from a wide variety of sources, including, among other things, sales of lift tickets (including season passes), ski school operations, other on-mountain activities, dining operations, retail sales, equipment rentals, private ski club amortized initiation fees and dues, marketing and internet advertising, commercial leasing, employee housing, municipal services and lodging and transportation operations at Perisher, and is recognized as products are delivered or services are performed. The Company records deferred revenue related to the sale of season ski passes. The number of season pass holder visits is estimated based on historical data and the deferred revenue is recognized throughout the ski season based on this estimate, or on a straight-line basis if usage patterns cannot be determined based on available historical data.
Revenue from non-refundable private club initiation fees is recognized over the estimated life of the facilities on a straight-line basis upon inception of the club. As ofyear ended July 31, 2018, the weighted average remaining period over which the private club initiation fees will be recognized is approximately 12 years. Additionally, certain club initiation fees2020.
Revenue Recognition — The Company’s significant accounting policies with regard to revenue recognition are refundablediscussed in 30 years after the date of acceptance of a member. Under these memberships, the difference between the amount paid by the member and the present value of the refund obligation is recorded as deferred initiation fee revenue in the Company’s Consolidated Balance Sheets and recognized as revenue on a straight-line basis over 30 years. The present value of the refund obligation is recorded as an initiation deposit liability and accretes over the nonrefundable term using the effective interest method. The accretion is included in interest expense.Note 3, Revenues.
Lodging revenue is derived from a wide variety of sources, including, among other things, hotel operations, dining operations, property management services, managed hotel property payroll cost reimbursements, private golf club amortized initiation fees and dues, transportation services and golf course greens fees, and is recognized as products are delivered or services are performed. Revenue from payroll cost reimbursements relates to payroll costs of managed hotel properties where the Company is the employer. The reimbursements are based upon the costs incurred with no added margin; therefore, these revenues and corresponding expenses have no net effect on the Company’s operating income or net income.
Real estate revenue primarily includes the sale of land parcels, which is recorded primarily using the full accrual method and occurs only upon the following: (i) substantial completion of the entire development project, if applicable, (ii) receipt of certificates of occupancy or temporary certificates of occupancy from local governmental agencies, if applicable, (iii) closing of the sales transaction including receipt of all, or substantially all, sales proceeds (including any deposits previously received) and (iv) transfer of ownership.
Real Estate Cost of Sales--Sales — Costs of real estate transactions include direct project costs, common cost allocations (primarily determined on relative sales value) and sales commission expense. The Company utilizes the relative sales value method to determine cost of sales for condominium units sold within a project when specific identification of costs cannot be reasonably determined.

Foreign Currency Translation -- — The functional currency of the Company’s entities operating outside of the United States is the principal currency of the economic environment in which the entity primarily generates and expends cash, which is generally the local currency. The assets and liabilities of these foreign operations are translated at the exchange rate in effect as of the balance sheet dates. Income and expense items are translated using the weighted average exchange rate for the period. Translation adjustments from currency exchange, including intercompany transactions of a long-term nature, are recorded in accumulated other comprehensive (loss) incomeloss as a separate component of stockholders’ equity. Intercompany transactions that are not of a long-term nature are reported as gains and losses within “segment operating expense” and for intercompany loans within “foreignforeign currency gain (loss) gain on intercompany loans”loans on the Company’s Consolidated Statements of Operations.
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Reserve Estimates--Estimates — The Company uses estimates to record reserves for certain liabilities, including medical claims, workers’ compensation claims, third-party loss contingencies and property taxes, among other items. The Company estimates the probable costs related to these liabilities that will be incurred and records that amount as a liability in its consolidated financial statements.Consolidated Financial Statements. Additionally, the Company records, as applicable, receivables related to insurance recoveries for loss contingencies if deemed probable of recovery. These estimates are reviewed and adjusted as the facts and circumstances change. The Company records legal costs related to defending claims as incurred.

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Advertising Costs-- — Advertising costs are expensed at the time such advertising commences. Advertising expense for the years ended July 31, 2018, 20172021, 2020 and 20162019 was $39.8$38.6 million, $40.0$41.6 million and $32.3$44.6 million, respectively.respectively, and was recorded within Mountain and Lodging operating expenses on the Company’s Consolidated Statement of Operations.
Income Taxes--Taxes — Income tax expense includes U.S. tax (federal and state) and foreign income taxes. Tax legislation commonly known as the Tax Cuts and Jobs Act of 2017 includes a mandatory one-time tax on accumulated earnings of foreign subsidiaries and, as a result, all previously unremitted earnings for which no U.S. deferred tax liability had been accrued have now been subject to U.S. tax. The Company’s provision for income taxes is based on pre-tax income, changes in deferred tax assets and liabilities and changes in estimates with regard to uncertain tax positions. Deferred tax assets and liabilities are recorded for the estimated future tax effects of temporary differences between the tax bases of assets and liabilities and amounts reported in the accompanying Consolidated Balance Sheets and for operating loss and tax credit carrybacks or carryforwards. The change in deferred tax assets and liabilities for the period measures the deferred tax provision or benefit for the period. Effects of changes in enacted tax laws on deferred tax assets and liabilities are reflected as adjustments to the tax provision or benefit in the period of enactment. The Company’s deferred tax assets have been reduced by a valuation allowance to the extent it is deemed to be more likely than not that some or all of the deferred tax assets will not be realized. The Company recognizes liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is “more-likely-than-not” to be sustained, on audit, including resolution of related appeals or litigation processes, if any. The second step requires the Company to estimate and measure the largest tax benefit that is cumulatively greater than 50% likely of being realized upon ultimate settlement. Interest and penalties accrued in connection with uncertain tax positions are recognized as a component of income tax expense (seeexpense. See Note 9,11, Income Taxes, for more information).information.
Fair Value of Financial Instruments-- — The recorded amounts for cash and cash equivalents, restricted cash, receivables, other current assets, and accounts payable and accrued liabilities and the EB-5 Development Notes (as defined in Note 6, Long-Term Debt) approximate fair value due to their short-term nature. The fair value of amounts outstanding under the Company’s credit agreements and the Employee Housing Bonds (as defined in Note 4,6, Long-Term Debt) approximate book value due to the variable nature of the interest rate which is a market rate, associated with the debt. The estimated fair values of the 6.25% Notes and the 0.0% Convertible Notes (each as defined in Note 6, Long-Term Debt) are based on quoted market prices (a Level 2 input). The estimated fair value of the EPR Secured Notes (as defined in Note 6, Long-Term Debt) has been estimated using an analysis based on current borrowing rates for debt with similar remaining maturities and ratings (a Level 2 input). The carrying values, including any unamortized premium or discount, and estimated fair values of the 6.25% Notes, 0.0% Convertible Notes and EPR Secured Notes as of July 31, 2021 are presented below (in thousands):
July 31, 2021
Carrying ValueEstimated Fair Value
6.25% Notes$600,000 $638,730 
0.0% Convertible Notes$477,755 $580,583 
EPR Secured Notes$135,711 $206,025 
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Stock-Based Compensation--Compensation — Stock-based compensation expense is measured at the grant date based upon the estimated fair value of the portion of the award that is ultimately expected to vest and is recognized as expense over the applicable vesting period of the award generally using the straight-line method (see Note 15,17, Stock Compensation Plan, for more information)., less the amount of forfeited awards which are recorded as they occur. The following table shows total net stock-based compensation expense for the years ended July 31, 2018, 20172021, 2020 and 20162019 included in the Consolidated Statements of Operations (in thousands):
 Year Ended July 31,
  
202120202019
Mountain stock-based compensation expense$20,311 $17,410 $16,474 
Lodging stock-based compensation expense3,783 3,399 3,219 
Real Estate stock-based compensation expense301 212 163 
Pre-tax stock-based compensation expense24,395 21,021 19,856 
Less: benefit from income taxes5,871 5,027 4,589 
Net stock-based compensation expense$18,524 $15,994 $15,267 
 Year Ended July 31,
  
201820172016
Mountain stock-based compensation expense$15,716
$14,969
$13,404
Lodging stock-based compensation expense3,215
3,215
3,094
Real Estate stock-based compensation expense109
131
527
Pre-tax stock-based compensation expense19,040
18,315
17,025
Less: benefit from income taxes5,406
6,290
6,057
Net stock-based compensation expense$13,634
$12,025
$10,968
Concentration of Credit Risk--Risk — The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents and restricted cash. The Company places its cash and temporary cash investments in low risk accounts with high-quality credit institutions. The Company does not enter into financial instruments for hedging, trading or speculative purposes. Concentration of credit risk with respect to accounts and notes receivables is limited due to the wide variety of customers and markets in which the Company transacts business, as well as their dispersion across many geographical areas. The Company performs ongoing credit evaluations of its customers and generally does not require collateral, but does require advance deposits on certain transactions.
Accounting for Hedging Instruments — From time to time, the Company enters into interest rate swaps to hedge the variability in cash flows associated with variable-rate borrowings by converting the floating interest rate to a fixed interest rate (the “Interest Rate Swaps”). As of July 31, 2021, the Company hedged the future cash flows associated with $400.0 million of the principal amount outstanding of its Vail Holdings Credit Agreement (as defined in Note 6, Long-Term Debt), which were designated as cash flow hedges. The accounting for changes in fair value of hedging instruments depends on the effectiveness of the hedge. In order to qualify for hedge accounting, the underlying hedged item must expose the Company to risks associated with market fluctuations and the financial instrument used must reduce the Company’s exposure to market fluctuation throughout the hedge period. Changes in estimated fair value of the Interest Rate Swaps are recorded within change in estimated fair value of hedging instruments on the Company’s Consolidated Statements of Comprehensive Income, and such change was recorded as a gain (loss) of $12.8 million and ($22.5) million during the years ended July 31, 2021 and 2020, respectively. Such amounts are reclassified into interest expense, net from other comprehensive income during the period in which the hedged item affects earnings. During the year ended July 31, 2021 $5.4 million was reclassified into interest expense, net from other comprehensive income. As of July 31, 2021, the estimated fair value of the Interest Rate Swaps was a liability of approximately $12.9 million and was recorded within other long-term liabilities on the Company’s Consolidated Balance Sheet, and the impact of the underlying cash flows associated with the Interest Rate Swaps are recorded within interest expense, net on the Company’s Consolidated Statements of Operations. See Note 10, Fair Value Measurements, for more information.
Leases — The Company determines if an arrangement is or contains a lease at inception or modification of the arrangement. An arrangement is or contains a lease if there is one or more assets identified and the right to control the use of any identified asset is conveyed to the Company for a period of time in exchange for consideration. Control over the use of an identified asset means the lessee has both the right to obtain substantially all of the economic benefits from the use of the asset and the right to direct the use of the asset. Generally, the Company classifies a lease as a finance lease if the terms of the agreement effectively transfer control of the underlying asset; otherwise, it is classified as an operating lease. For contracts that contain lease and non-lease components, the Company accounts for these components separately. For leases with terms greater than twelve months, the associated lease right-of-use (“ROU”) assets and lease liabilities are recognized at the estimated present value of future lease payments over the lease term at commencement date. The Company’s leases do not provide a readily determinable implicit rate; therefore, the Company uses an estimated incremental borrowing rate to discount the future minimum lease payments. For leases containing fixed rental escalation clauses, the escalators are factored into the determination of future minimum lease payments. The Company includes options to extend a lease when it is reasonably certain that such options will be exercised. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. See Note 4, Leases, for more information. The Company adopted Accounting Standards Update (“ASU”) No. 2016-02 on August 1, 2019, which required lessees to recognize the assets and liabilities arising from all leases on the balance sheet, using the modified retrospective transition method as provided by the standard. Accordingly, reporting periods beginning on August 1, 2019 are
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presented under the new standard, while prior periods were not adjusted and continue to be reported in accordance with the previously applicable accounting guidance.
Use of Estimates--Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the balance sheet date and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Recently Issued Accounting Standards
Adopted Standards0Standards Being Evaluated
In March 2016,2020, the FASB issuedFinancial Accounting Standards UpdateBoard (“ASU”FASB”) No. 2016-09, “Compensation - Stock Compensationissued ASU 2020-04, “Reference Rate Reform (Topic 718)848): Improvements to Employee Share-Based Payment Accounting.Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” The newASU provides optional transition guidance, requiresfor a limited time, to companies that have contracts, hedging relationships or other transactions that reference the London Inter-bank Offered Rate (“LIBOR”) or another reference rate which is expected to record all excess tax benefitsbe discontinued because of reference rate reform. The amendments provide optional expedients and tax deficienciesexceptions for applying GAAP to contracts, hedging relationships, and other transactions if certain criteria are met. The amendments in this update are effective as income tax expenseof March 12, 2020 through December 31, 2022. The amendments in this update may be applied as of any date from the beginning of an interim period that includes or benefitis subsequent to March 12, 2020, or prospectively from a date within an interim period that includes or is subsequent to March 12, 2020, up to the date that the financial statements are available to be issued. All other amendments should be applied on a prospective basis. The Company is in the income statement whenprocess of evaluating the awards vest or are

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settled, as applicable, rather than within additional paid in capital which was required undereffect that the previous guidance. The guidance also requires companies to present excess tax benefits as an operating activity and cash paid to a taxing authority to satisfy an employee’s statutory withholding as a financing activity on the statementadoption of cash flows. Additionally, the guidance allows companies to make a policy election to account for forfeitures either upon occurrence or by estimating forfeitures. The Company adopted this standard on August 1, 2017, and is prospectively recording excess tax benefits and deficiencies within the provision or benefit for income taxeswill have on its Consolidated Financial Statements, of Operations when stock-based compensation awards vest or are exercised. The Company expects thisbut does not expect it will increase volatility of the provision or benefit for income taxes as the amount of excess tax benefits or deficiencies from stock-based compensation awards are dependent on the Company’s stock price at the date the awards vest or are exercised. As a result of adopting this provision of the standard, the Company recorded $71.1 million of excess tax benefits within benefit from income taxes on its Consolidated Statement of Operations for the year ended July 31, 2018, resulting from vesting or exercises of equity awards during the period. As of August 1, 2017, the Company prospectively presented excess tax benefits as operating activities on its Consolidated Statement of Cash Flows for the year ended July 31, 2018. Additionally, the Company has elected to record actual forfeitures for recording stock-based compensation expense when they occur, rather than estimate expected forfeitures, which did not have a material impact to the Consolidated Statement of Operations for the year ended July 31, 2018.effect.


In accordance with the disclosure provisions of the new guidance, the Company retrospectively adopted the new presentation. Cash paid to taxing authorities on an employee’s behalf was changed to be classified as a financing activity in the Consolidated Statements of Cash Flows, which resulted in decreases to cash provided by financing activities with corresponding increases to cash provided by operating activities of approximately $16.3 million and $10.2 million, respectively, for the years ended July 31, 2017 and 2016, as shown below (in thousands).
 Year Ended July 31, 2017
 Previously Reported (Previous Guidance) Tax Payments Change Revised Reported (New Guidance)
Cash flows provided by operating activities$456,914
 $16,275
 $473,189
Cash flows used in investing activities (no change)(682,836) —
 (682,836)
Cash flows provided by financing activities271,892
 (16,275) 255,617
Effect of exchange rate changes (no change)3,522
 —
 3,522
Net increase in cash and cash equivalents (no change)$49,492
 $—
 $49,492
 Year Ended July 31, 2016
 Previously Reported (Previous Guidance) Tax Payments Change Revised Reported (New Guidance)
Cash flows provided by operating activities$426,762
 $10,215
 $436,977
Cash flows used in investing activities (no change)(124,016) —
 (124,016)
Cash flows used in financing activities(271,217) (10,215) (281,432)
Effect of exchange rate changes (no change)909
 —
 909
Net increase in cash and cash equivalents (no change)$32,438
 $—
 $32,438

In January 2017,August 2020, the FASB issued ASU No. 2017-04, “Intangibles-Goodwill2020-06, “Accounting for Convertible Instruments and Other (Topic 350): SimplifyingContracts in an Entity’s Own Equity” which simplifies the Test for Goodwill Impairment.” The standard simplifies interim and annual goodwill impairment testing by eliminating step two, a hypothetical purchase price allocation, from the goodwill impairment test and leaving step one unchanged. Under the new guidance companies will continue to complete step one by comparing the estimated fair value of their reporting units with their respective carrying amounts, and will recognize an impairment charge, if any, for the amount by which the carrying amount exceeds the reporting unit’s estimated fair value. The standard is effective for financial statements issued for fiscal years beginning after December 15, 2019 (the Company’s first quarter of fiscal 2021), with early adoption permitted. The Company elected to early adopt this accounting standard on May 1, 2018, which did not have an impact on its consolidated financial statements.

Standards Being Evaluated
In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which supersedes the revenue recognition requirements in Accounting Standards Codification 605, “Revenue Recognition.” This ASU is based onCodifications (“ASC”) 470-20, “Debt – Debt with Conversion and Other Options” by reducing the

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principle that revenue is recognized to depict number of accounting separation models for convertible instruments, amending the transfer of goods or services to customersguidance in ASC 815-40, “Derivatives and Hedging – Contracts in Entity’s Own Equity” for certain contracts in an amountentity’s own equity that reflectsare currently accounted for as derivatives, and requiring entities to use the consideration to whichif-converted method for all convertible instruments in the company expects to be entitled in exchange for those goods or services. The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. Subsequent to the issuance of ASU 2014-09, the FASB has issued several amendments, which do not change the core principle of the guidance and are intended to clarify and improve understanding of certain topics included within the revenue standard.diluted earnings per share (“EPS”) calculation. This standard will be effective for the first interim period within fiscal years beginning after December 15, 2017 (the Company’s first quarter of fiscal 2019). The guidance permits two retrospective methods of adoption; adjusting each prior reporting period presented (full retrospective method) or an adjustment to retained earnings for the cumulative effect of implementing the guidance at the date of adoption (modified retrospective method). The Company has completed a review of the majority of its revenue streams consisting of (i) season pass sales, (ii) non-season pass lift ticket sales, (iii) ski school sales, (iv) retail/rental sales, (v) food and beverage sales and (vi) hospitality services and determined that the new guidance will not result in a material impact to the Company’s consolidated financial statements. The Company will adopt this guidance on August 1, 2018 under the modified retrospective transition method. Additionally, the new guidance will not have a material effect on the timing, pattern and classification of the Company’s revenue recognition. The Company expects to expand its revenue recognition related disclosures.

In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842),” which supersedes “Leases (Topic 840).” The standard requires lessees to recognize the assets and liabilities arising from all leases, including those classified as operating leases under previous accounting guidance, on the balance sheet and disclose key information about leasing arrangements. The standard also allows for an accounting policy election not to recognize on the balance sheet lease assets and liabilities for leases with a term of 12 months or less. Under the new guidance, lessees will be required to recognize a lease liability and a right-of-use asset on their balance sheets, while lessor accounting will be largely unchanged. The standard will be effective for fiscal years beginning after December 15, 2018,2021, including interim periods within those fiscal years (the Company’s first quarter of the fiscal 2020), and must be applied using a modified retrospective transition approach to leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with earlyyear ending July 31, 2023). Early adoption permitted. The Company is currently evaluating the impacts the adoption of this accounting standard will have on the Company’s financial position or results of operations and cash flows and related disclosures. Additionally, the Company is evaluating the impacts of the standard beyond accounting, including system, data and process changes required to comply with the standard and has selected an information system application that will centralize the Company’s lease information and be utilized for accounting under the new standard.

In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” The standard provides guidance for eight targeted changes with respect to how cash receipts and cash payments are classified in the statements of cash flows, with the objective of reducing diversity in practice. The standard is effective for financial statements issued forpermitted, but no earlier than fiscal years beginning after December 15, 20172020, including interim periods within those fiscal years (the Company’s first quarter of the fiscal 2019), with early adoption permitted.year ending July 31, 2022). This standard allows for a modified retrospective or fully retrospective method of transition. The Company does not expectwill adopt ASU 2020-06 on August 1, 2022 and expects to use the modified retrospective method, and therefore financial information for periods before August 1, 2022 will remain unchanged. As a result of the adoption of ASU 2020-06, the Company expects that it will reclassify the equity component of its 0.0% Convertible Notes (as defined in Note 6, Long-Term Debt) to long-term debt, net, and it will no longer record interest expense related to the amortization of the debt discount.
3.     Revenues
Revenue Recognition
The following provides information about the Company’s composition of revenue recognized from contracts with customers and other revenues, the performance obligations under those contracts, and the significant judgments made in accounting for those contracts:

•Mountain revenue is derived from a wide variety of sources, including, among other things: lift revenue, which includes sales of lift tickets and pass products; ski school revenue, which includes the revenue derived from ski school operations; dining revenue, which includes both casual and fine dining on-mountain operations; retail sales and equipment rentals; and other on-mountain revenue, which includes private ski club revenue (which includes both club dues and amortization of initiation fees), marketing and internet advertising revenue, municipal services and lodging and transportation operations at the Company’s Australian ski areas. Revenue is recognized over time as performance obligations are satisfied as control of the good or service (e.g. access to ski areas, provision of ski school services, etc.) is transferred to the customer, except for the Company’s retail sales and dining operations revenues which are recognized at a point in time when performance obligations are satisfied by transferring control of the underlying goods to the customer. The Company records deferred revenue primarily related to the sale of pass products. Deferred revenue is generally recognized throughout the ski season as the Company’s performance obligations are satisfied as control of the service (e.g. access to ski areas throughout the ski season) is transferred to the customer. Transfer of
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control is based on an estimated number of pass product holder visits relative to total expected visits. Total expected visits are estimated based on historical data, and the Company believes this accounting standardestimate provides a faithful depiction of its customers’ pass product usage. When sufficient historical data to determine usage patterns is not available, such as in the case of new product offerings, deferred revenue is recognized on a straight-line basis throughout the ski season until sufficient historical usage patterns are available. The Company also includes other sources of revenue, primarily related to commercial leasing and employee housing leasing arrangements, within other mountain revenue.

•Lodging revenue is derived from a wide variety of sources, including, among other things: revenue from owned hotel rooms and managed hotel rooms; revenue from hotel dining operations; transportation revenue which relates to the Company’s Colorado resort ground transportation operations; and other lodging revenue which includes property management services, managed properties other costs reimbursements, private golf club revenue (which includes both club dues and amortization of initiation fees), and golf course fees. Lodging revenue also includes managed hotel property payroll cost reimbursements related to payroll costs at managed properties where the Company is the employer, which are reimbursed by the owner with no added margin. Therefore, these revenues and corresponding expenses have no net effect on the Company’s operating income or net income. Other than revenue from dining operations, lodging revenue is mostly recognized over time as performance obligations are satisfied as control of the service (e.g. nightly hotel room access) is transferred to the customer.

•Real estate revenue primarily relates to the sale of development land parcels. Real estate revenue is generally recognized at a material impactpoint in time when performance obligations have been satisfied, which is usually upon closing of the sales transaction and in an amount that reflects the consideration to which the Company expects to be entitled.
For certain contracts that have an original term length of one year or less, the Company uses the practical expedient applicable to such contracts and does not consider the time value of money. For contracts with an expected term in excess of one year, the Company has considered the provisions of Topic 606 in determining whether contracts contain a financing component. The Company presents revenues in the accompanying Consolidated Statements of Operations, net of taxes, when collected from its customers that are remitted or payable to government taxing authorities, except when products are inclusive of taxes where applicable.
As a result of the COVID-19 pandemic, the Company closed its North American destination mountain resorts, regional ski areas and retail stores early during the 2019/2020 North American ski season, beginning on March 15, 2020. Subsequently, the Company 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 discounts ranged 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. The Credit Offer was considered a contract modification which constituted an option to purchase an additional pass product for 2019/2020 North American ski season guests and, as such, represented a separate performance obligation to which the Company allocated a transaction price of approximately $120.9 million. As a result, the Company deferred $120.9 million of pass product revenue, which would have otherwise been recognized as lift revenue during the year ended July 31, 2020. The Credit Offer expired on September 17, 2020 and the Company recorded $15.4 million as lift revenue during the three months ended October 31, 2020, which was the amount of Credit Offer discounts which were not redeemed. The remaining deferred revenue associated with the Credit Offer was recognized as lift revenue primarily during the 2020/2021 North American ski season, as the performance obligations were satisfied.
In April 2020, the Company announced Epic Coverage, which is included with the purchase of all pass products for no additional charge. Epic Coverage offers refunds to pass product holders if certain qualifying personal or resort closure events occur before or during the ski season. The estimated amount of refunds reduce the amount of pass product revenue recognized by the Company. To estimate the amount of refunds under Epic Coverage, the Company considers (i) historical claims data for personal events, (ii) provincial, state, county and local COVID-19 regulations and public health orders, (iii) the ability for the Company’s pass holders to make reservations on their preferred days (for only the 2020/2021 North American ski season, during which the Company utilized a reservation system) and (iv) the Company’s operating plans for its resorts. The Company believes the estimates of refunds are reasonable; however, actual results could vary materially from such estimates, and such estimates will be remeasured at each reporting date.
Additionally, for the 2020/2021 North American ski season, the Company introduced Epic Mountain Rewards, a program which provides pass product holders a discount of 20% off on-mountain food and beverage, lodging, group ski school lessons, equipment rentals and more at the Company’s North American owned and operated Resorts. Epic Mountain Rewards constitutes an option to our guests to purchase additional products and services from us at a discount and as a result, the Company allocates a portion of the pass product transaction price to these other lines of business.
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Disaggregation of Revenues
The following table presents net revenues disaggregated by segment and major revenue type for the years ended July 31, 2021, 2020 and 2019 (in thousands):
Year ended July 31,
 202120202019
Mountain net revenue:
Lift$1,076,578 $913,091 $1,033,234 
Ski School144,227 189,131 215,060 
Dining90,329 160,763 181,837 
Retail/Rental227,993 270,299 320,267 
Other150,751 177,159 205,803 
Total Mountain net revenue$1,689,878 $1,710,443 $1,956,201 
Lodging net revenue:
Owned hotel rooms$47,509 $44,992 $64,826 
Managed condominium rooms72,217 76,480 86,236 
Dining19,068 38,252 53,730 
Transportation9,271 15,796 21,275 
Golf20,437 17,412 19,648 
Other43,007 44,933 54,617 
211,509 237,865 300,332 
Payroll cost reimbursements6,553 10,549 14,330 
Total Lodging net revenue$218,062 $248,414 $314,662 
Total Resort net revenue$1,907,940 $1,958,857 $2,270,863 
Total Real Estate net revenue1,770 4,847 712 
Total net revenue$1,909,710 $1,963,704 $2,271,575 
Arrangements with Multiple Performance Obligations
Several of the Company’s contracts with customers include multiple performance obligations, primarily related to bundled services such as ski school packages, lodging packages and events (e.g. weddings and conferences). For such contracts, revenue is allocated to each distinct and separate performance obligation based on its consolidated financial statements.relative standalone selling price. The standalone selling prices are generally based on observable prices charged to customers or estimated based on historical experience and information.

Contract Balances
Contract liabilities are recorded primarily as deferred revenues when payments are received or due in advance of the Company’s performance, including amounts which may be refundable. The deferred revenue balance is primarily related to accounts receivable or cash payments recorded in advance of satisfying the Company’s performance obligations related to sales of pass products prior to the start of the ski season, private club initiation fees and other related advance purchase products, including advance purchase lift tickets, multiple-day lift tickets, ski school lessons, equipment rentals and lodging advance deposits. Due to the seasonality of the Company’s operations, its largest deferred revenue balances occur during the North American pass product selling window, which generally begins in the third quarter of its fiscal year. Deferred revenue balances of a short-term nature were $456.5 million and $256.4 million as of July 31, 2021 and 2020, respectively, and the increase was primarily due to an increase in pass product sales for the 2021/2022 North American ski season as compared to the prior year from the beginning of the selling season through each respective fiscal year-end, due largely to the lack of any spring sales deadlines in fiscal year 2020 as a result of COVID-19. Deferred revenue balances of a long-term nature, comprised primarily of long-term private club initiation fee revenue, were $121.0 million and $121.9 million as of July 31, 2021 and 2020, respectively. For the year ended July 31, 2021, the Company recognized approximately $232.8 million of revenue that was included in the deferred revenue balance as of July 31, 2020. As of July 31, 2021, the weighted average remaining period over
3.
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which revenue for unsatisfied performance obligations on long-term private club contracts will be recognized was approximately 16 years.
Contract assets are recorded as trade receivables when the right to consideration is unconditional. Trade receivable balances were $345.4 million and $106.7 million as of July 31, 2021 and 2020, respectively. Payments from customers are based on billing terms established in the contracts with customers, which vary by the type of customer, the location and the products or services offered. The term between invoicing and when payment is due is not significant. For certain products or services and customer types, contracts require payment before the products are delivered or services are provided to the customer. Impairment losses related to contract assets are recognized through the Company’s allowance for doubtful accounts analysis. Contract asset write-offs are evaluated on an individual basis.
Costs to Obtain Contracts with Customers
The Company expects that credit card fees and sales commissions paid in order to obtain season ski pass products contracts are recoverable. Accordingly, the Company records these amounts as assets when they are paid prior to the start of the ski season. As of July 31, 2021, $3.1 million of costs to obtain contracts with customers were recorded within other current assets on the Company’s Consolidated Balance Sheet. Deferred credit card fees and sales commissions are amortized commensurate with the recognition of season ski pass revenue. The Company recorded amortization of $17.8 million, $11.0 million and $10.6 million for these costs during the years ended July 31, 2021, 2020 and 2019, respectively, which were recorded within Mountain and Lodging operating expenses on the Company’s Consolidated Statement of Operations.
Utilizing the practical expedient provided for under Topic 606, the Company has elected to expense credit card fees and sales commissions related to non-season ski pass products and services as incurred, as the amortization period is generally one year or less for the time between customer purchase and utilization. These fees are recorded within Mountain and Lodging operating expenses on the Company’s Consolidated Statements of Operations.
4.     Leases
The Company’s operating leases consist primarily of commercial and retail space, office space, employee residential units, vehicles and other equipment. The Company determines if an arrangement is or contains a lease at contract inception or modification. The Company’s lease contracts generally range from 1 year to 60 years, with some lease contracts containing one or more lease extension options, exercisable at the Company’s discretion. The Company generally does not include these lease extension options in the initial lease term as it is not reasonably certain that it will exercise such options at contract inception. In addition, certain lease arrangements contain fixed and variable lease payments. The variable lease payments are primarily contingent rental payments based on: (i) a percentage of revenue related to the leased property; (ii) payments based on a percentage of sales over contractual levels; or (iii) lease payments adjusted for changes in an index or market value. These variable lease payments are typically recognized when the underlying event occurs and are included in operating expenses in the Company’s Consolidated Statements of Operations in the same line item as the expense arising from the respective fixed lease payments. The Company’s lease agreements may also include non-lease components, such as common area maintenance and insurance, which are accounted for separately. Future lease payments that are contingent and non-lease components are not included in the measurement of the operating lease liability. The Company’s lease agreements do not contain any material residual value guarantees or restrictive covenants. Lease expense related to lease payments is recognized on a straight-line basis over the term of the lease.
The Company’s leases do not provide a readily determinable implicit rate. As a result, the Company measures the lease liability using an estimated incremental borrowing rate which is intended to reflect the rate of interest the Company would pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms. The Company applies the estimated incremental borrowing rates at a portfolio level based on the economic environment associated with the lease.
The Company uses the long-lived assets impairment guidance to determine recognition and measurement of an ROU asset impairment, if any. The Company monitors for events or changes in circumstances that require a reassessment.
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The components of lease expense for the years ended July 31, 2021 and 2020 were as follows (in thousands):
Year ended July 31,
20212020
Finance leases:
Amortization of the finance ROU assets$9,753 $9,753 
Interest on lease liabilities$34,612 $34,035 
Operating leases:
Operating lease expense$43,418 $43,303 
Short-term lease expense (1)
$13,638 $13,943 
Variable lease expense$1,660 $1,583 
(1) Short-term lease expense is attributable to leases with terms of 12 months or less which are not included within the Company’s Consolidated Balance Sheets.
The following table presents the supplemental cash flow information associated with the Company’s leasing activities for the years ended July 31, 2021 and 2020 (in thousands):
Year ended July 31,
20212020
Cash flow supplemental information:
Operating cash outflows for operating leases$56,942 $55,344 
Operating cash outflows for finance leases$31,429 $29,311 
Financing cash outflows for finance leases$— $5,387 
Non-cash supplemental information:
Operating ROU assets obtained in exchange for operating lease obligations$12,615 $18,013 
Weighted-average remaining lease terms and discount rates are as follows:
July 31, 2021July 31, 2020
Weighted-average remaining lease term (in years)
Operating leases10.210.6
Finance leases41.942.9
Weighted-average discount rate
Operating leases4.5 %4.5 %
Finance leases10.0 %10.0 %
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Future fixed lease payments for operating and finance leases as of July 31, 2021 reflected by fiscal year (August 1 through July 31) are as follows (in thousands):
Operating LeasesFinance Leases
2022$47,036 $29,394 
202340,994 29,982 
202436,452 30,582 
202533,924 31,193 
202630,362 31,817 
Thereafter109,063 1,742,038 
Total future minimum lease payments297,831 1,895,006 
Less amount representing interest(72,249)(1,543,186)
Total lease liabilities$225,582 $351,820 
The current portion of operating lease liabilities of approximately $34.7 million and $36.6 million as of July 31, 2021 and 2020, respectively, are recorded within accounts payables and accrued liabilities in the Consolidated Balance Sheet. Finance lease liabilities are recorded within long-term debt, net in the Consolidated Balance Sheets.
The Canyons finance lease obligation represents the only material finance lease entered into by the Company and was $351.8 million and $346.0 million as of July 31, 2021 and 2020, respectively, which represents the estimated annual fixed lease payments for the remaining initial 50 year term of the lease assuming annual increases at the floor of 2% and discounted using an interest rate of 10%. As of July 31, 2021 and 2020, respectively, the Company has recorded $108.0 million and $117.8 million of finance lease ROU assets in connection with the Canyons lease, net of $75.5 million and $65.8 million of accumulated amortization, which is included within property, plant and equipment, net in the Company’s Consolidated Balance Sheet.
5.    Net Income Per Common Share
Earnings per Share
Basic earnings per share (“EPS”) excludes dilution and is computed by dividing net income attributable to Vail Resorts stockholders by the weighted-average shares outstanding during the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised, resulting in the issuance of shares of common stock that would then share in the earnings of Vail Resorts.

In connection with the Company’s acquisition of Whistler Blackcomb in October 2016 (see Note 5,7, Acquisitions), the Company issued consideration in the form of shares of Vail Resorts common stock (the “Vail Shares”) and shares of the Company’s wholly-owned Canadian subsidiary (“Exchangeco”). Whistler Blackcomb shareholders elected to receive 3,327,719 Vail Shares and 418,095 shares of Exchangeco (the “Exchangeco Shares”). Both Vail Shares and Exchangeco Shares have a par value of $0.01 per share, and Exchangeco Shares, while outstanding, are substantially the economic equivalent of the Vail Shares and are exchangeable, at any time prior to the seventh anniversary of the closing of the acquisition, into Vail Shares. The Company’s calculation of weighted-average shares outstanding includes the Exchangeco Shares.


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Presented below is basic and diluted EPS for the years ended July 31, 2018, 20172021, 2020 and 20162019 (in thousands, except per share amounts):
Year Ended July 31, Year Ended July 31,
201820172016
202120202019
BasicDilutedBasicDilutedBasicDiluted
BasicDilutedBasicDilutedBasicDiluted
Net income per share: Net income per share:
Net income attributable to Vail Resorts$379,898
$379,898
$210,553
$210,553
$149,754
$149,754
Net income attributable to Vail Resorts$127,850 $127,850 $98,833 $98,833 $301,163 $301,163 
Weighted-average shares outstanding40,337
40,337
39,158
39,158
36,276
36,276
Weighted-average shares outstanding40,266 40,266 40,227 40,227 40,292 40,292 
Weighted-average Exchangeco shares outstanding60
60
93
93
—
—
Weighted-average Exchangeco shares outstanding35 35 46 46 57 57 
Total Weighted-average shares outstanding40,397
40,397
39,251
39,251
36,276
36,276
Total Weighted-average shares outstanding40,301 40,301 40,273 40,273 40,349 40,349 
Effect of dilutive securities—
1,221
—
1,115
—
1,036
Effect of dilutive securities— 527 — 565 — 809 
Total shares40,397
41,618
39,251
40,366
36,276
37,312
Total shares40,301 40,828 40,273 40,838 40,349 41,158 
Net income per share attributable to Vail Resorts$9.40
$9.13
$5.36
$5.22
$4.13
$4.01
Net income per share attributable to Vail Resorts, Inc.Net income per share attributable to Vail Resorts, Inc.$3.17 $3.13 $2.45 $2.42 $7.46 $7.32 
The Company computes the effect of dilutive securities using the treasury stock method and average market prices during the period. The number of shares issuable on the exercise of share based awards that were excluded from the calculation of diluted net income per share because the effect of their inclusion would have been anti-dilutive totaled approximately 2,000, 9,0002,000 and 18,0004,000 for the years ended July 31, 2018, 20172021, 2020 and 2016,2019, respectively.

Dividends
On March 7, 2018,December 18, 2020, the Company completed an offering of $575.0 million in aggregate principal amount of 0.0% Convertible Notes (as defined in Note 6, Long-Term Debt). The Company is required to settle the principal amount of the 0.0% Convertible Notes in cash and has the option to settle the conversion spread in cash or shares. The Company uses the treasury method to calculate diluted EPS, and if the conversion value of the 0.0% Convertible Notes exceeds their conversion price of $407.17 per share of common stock, then the Company will calculate its diluted EPS as if all the notes were converted and the Company issued shares of its common stock to settle the excess value over the conversion price. The par value of the 0.0% Convertible Notes is required to be settled in cash and therefore would not impact diluted EPS. However, if reflecting the 0.0% Convertible Notes in diluted EPS in this manner is anti-dilutive, or if the conversion value of the notes does not exceed their initial conversion amount for a reporting period, then the shares underlying the notes will not be reflected in the Company’s Boardcalculation of Directors approved an increase of approximately 40% in the annual cash dividend to an annual rate of $5.88 per share, subject to quarterly declaration.diluted EPS. For the year ended July 31, 2018,2021, the average price of Vail Shares did not exceed the conversion price and therefore there was no impact to diluted EPS during those periods.
Dividends
The Company did not pay cash dividends during the year ended July 31, 2021. During the years ended July 31, 2020 and 2019, the Company paid cash dividends of $5.046$5.28 per share ($204.2212.7 million in the aggregate). and $6.46 per share ($260.6 million in the aggregate), respectively. On September 27, 201822, 2021 the Company’s Board of Directors approved a quarterly cash dividend of $1.47$0.88 per share payable on October 26, 201822, 2021 to stockholders of record as of October 9, 2018.5, 2021. Additionally, a Canadian dollar equivalent dividend on the Exchangeco Shares will be payable on October 26, 201822, 2021 to the shareholders of record on October 9, 2018.5, 2021.

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4.

6.    Long-Term Debt
Long-term debt as of July 31, 20182021 and 20172020 is summarized as follows (in thousands):
MaturityJuly 31,
2021		July 31,
2020
Vail Holdings Credit Agreement revolver (a)
2024$— $— 
Vail Holdings Credit Agreement term loan (a)
20241,140,625 1,203,125 
6.25% Notes (b)
2025600,000 600,000 
0.0% Convertible Notes (c)
2026575,000 — 
Whistler Credit Agreement revolver (d)
202444,891 58,236 
EPR Secured Notes (e)
2034-2036114,162 114,162 
EB-5 Development Notes (f)
202151,500 51,500 
Employee housing bonds (g)
2027-203952,575 52,575 
Canyons obligation (h)
2063351,820 346,034 
Other (i)
2021-203317,941 18,616 
Total debt2,948,514 2,444,248 
Less: Unamortized premiums, discounts and debt issuance costs (j)
98,222 (6,551)
Less: Current maturities (k)
 114,117 63,677 
Long-term debt, net$2,736,175 $2,387,122 
 MaturityJuly 31,
2018		July 31,
2017
Vail Holdings Credit Agreement revolver (a)2021$130,000
$50,000
Vail Holdings Credit Agreement term loan (a)2021684,375
721,875
Whistler Credit Agreement revolver (b)202265,353
113,119
Employee housing bonds (c)2027-203952,575
52,575
Canyons obligation (d)2063334,509
328,786
Other (e)2024-20289,270
10,166
Total debt 1,276,082
1,276,521
Less: Unamortized debt issuance costs 3,350
4,100
Less: Current maturities (f) 38,455
38,397
Long-term debt, net $1,234,277
$1,234,024

(a)On October 14, 2016, in order to finance the cash portion of the consideration and payment of associated fees and expenses of the Whistler Blackcomb acquisition (see Note 5, Acquisitions), the Company’s wholly-owned subsidiary, Vail Holdings, Inc. (“VHI”) entered into the Second(a)On December 18, 2020, Vail Holdings, Inc. (“VHI”), certain subsidiaries of the Company, as guarantors, Bank of America, N.A., as administrative agent, and certain Lenders entered into a Fourth Amendment to the Seventh Amended and Restated Credit Facility, dated as of May 1, 2015 (the “Vail Holdings Credit Agreement”), with Bank of America, N.A., as administrative agent, and other lenders named therein, through which these lenders provided an additional $509.4 million in incremental term loans and agreed, on behalf of all lenders, to extend the maturity date for the outstanding term loans and revolver facility under the Vail Holdings Credit Agreement to October 14, 2021 (the “Amendment”). The Vail Holdings Credit Agreement consists of a $400.0 million revolving credit facility and a $750.0 million term loan facility. The other material terms of the Vail Holdings Credit Agreement were not altered by the Amendment. VHI’s obligations under the Vail Holdings Credit Agreement are guaranteed by the Company and certain of its subsidiaries and are collateralized by a pledge of all the capital stock of VHI and substantially all of its subsidiaries (with certain additional exceptions for the pledge of the capital stock of foreign subsidiaries). In addition,

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pursuant to the terms of the Vail Holdings Credit Agreement (the “Fourth Amendment”). Pursuant to the Fourth Amendment, among other terms, VHI has the ability to increase availability (under the revolver or in the form of term loans) to an aggregate principal amount not to exceed the greater of (i) $950.0 million and (ii) the product of 2.75 and the trailing twelve-month Adjusted EBITDA, as defined inis exempt from complying with the Vail Holdings Credit Agreement.Agreement’s maximum leverage ratio, senior secured leverage ratio and minimum interest coverage ratio financial maintenance covenants for each of the fiscal quarters ending through January 31, 2022 (unless VHI makes a one-time irrevocable election to terminate such exemption period prior to such date) (such period, the “Financial Covenants Temporary Waiver Period”), after which VHI will again be required to comply with such covenants starting with the fiscal quarter ending April 30, 2022 (or such earlier fiscal quarter as elected by VHI). After the expiration of the Financial Covenants Temporary Waiver Period:

•the maximumratiopermittedunderthemaximumleverageratiofinancialmaintenancecovenantshallbe6.25to1.00;
•the maximum ratio permitted under the senior secured leverage ratio financial maintenance covenant shall be 4.00to1.00;and
•the minimumratiopermittedundertheminimuminterestcoverageratiofinancialmaintenancecovenantwillbe 2.00 to1.00.
The Company is prohibited from the following activities during the Financial Covenants Temporary Waiver Period (unless approval is obtained by a majority of the Lenders):
•paying any dividends or making share repurchases, unless (x) no default or potential default exists under the Vail Holdings Credit Agreement and (y) the Company has liquidity (as defined below) of at least $300.0 million, and the aggregate amount of dividends paid and share repurchases made by the Company during the Financial Covenants Temporary Waiver Period may not exceed $38.2 million in any fiscal quarter;
•incurring indebtedness secured by the collateral under the Vail Holdings Credit Agreement in an amount in excess of $1.75 billion; and
•making certain non-ordinary course investments in similar businesses, joint ventures and unrestricted subsidiaries unless the Company has liquidity (as defined below) of at least$300.0 million;
The Fourth Amendment also removed certain restrictions under the Financial Covenants Temporary Waiver Period, including (i) removing the restriction on acquisitions so long as the Company has liquidity (as defined below) of at least $300.0 million and (ii) removing the $200.0 million annual limit on capital expenditures.
In addition, VHI is required to comply with a monthly minimum liquidity test (liquidity is defined as unrestricted cash and temporary cash investments of VHI and its restricted subsidiaries and available commitments under the Vail Holdings
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Credit Agreement revolver) of not less than $150.0 million until the date which VHI delivers a compliance certificate for the Company and its subsidiaries’ first fiscal quarter following the end of the Financial Covenants Temporary Waiver Period.
During the Financial Covenants Temporary Waiver Period, borrowings under the Vail Holdings Credit Agreement, including the term loan facility, bear interest annually at LIBOR plus 2.50% and, for amounts in excess of $400.0 million, LIBOR is subject to a floor of 0.25% (which decreased from the floor of 0.75% that was in effect prior to the Fourth Amendment).
As of July 31, 2021, the Vail Holdings Credit Agreement consists of a $500.0 million revolving credit facility and a $1.1 billion outstanding term loan facility. The term loan facility is subject to quarterly amortization of principal of approximately $9.4$15.6 million which(which began onin January 31, 2017,2020), in equal installments, with five percentfor a total of 5% of principal payable in each year and the final payment of all amounts outstanding, plus accrued and unpaid interest due in October 2021.September 2024. The proceeds of the loans made under the Vail Holdings Credit Agreement may be used to fund the Company’s working capital needs, capital expenditures, acquisitions, investments and other general corporate purposes, including the issuance of letters of credit.credit, subject to the Financial Covenants Temporary Waiver Period limitations. Borrowings under the Vail Holdings Credit Agreement, including the term loan facility, bear interest annually at LIBOR plus 1.125%2.50% as of July 31, 2018 (3.20%2021 (2.59% for the first $400.0 million of borrowings, and for amounts in excess of $400.0 million for which LIBOR is subject to a floor of 0.25% during the Financial Covenants Temporary Waiver Period, 2.75%). Other than as of July 31, 2018). Interestimpacted by the provisions in place during the Financial Covenants Temporary Waiver Period, interest rate margins may fluctuate based upon the ratio of the Company’s Net Funded Debt to Adjusted EBITDA on a trailing four-quarterfour- quarter basis. The Vail Holdings Credit Agreement also includes a quarterly unused commitment fee, which is equal to a percentage determined by the Net Funded Debt to Adjusted EBITDA ratio, as each such term is defined in the Vail Holdings Credit Agreement, timesmultiplied by the daily amount by which the Vail Holdings Credit Agreement commitment exceeds the total of outstanding loans and outstanding letters of credit (0.2%(0.4% as of July 31, 2018)2021). The unused amounts are accessibleDuring the year ended July 31, 2020, the Company entered into various interest rate swap agreements to hedge the LIBOR-based variable interest rate component of underlying cash flows of $400.0 million in principal amount of its Vail Holdings Credit Agreement for the remaining term of the agreement at an effective rate of 1.46%.
(b)On May 4, 2020, the Company completed its offering of $600 million aggregate principal amount of 6.25% senior notes due 2025 at par (the “6.25% Notes”), and a portion of the net proceeds were utilized to pay down the outstanding balance of the revolver component of its Vail Holdings Credit Agreement in its entirety (which will continue to be available to the extent thatCompany to borrow including throughout the Net Funded DebtFinancial Covenants Temporary Waiver Period) and to Adjusted EBITDA ratio doespay the fees and expenses associated with the offering, with the remaining net proceeds intended to be used for general corporate purposes.
The Company pays interest on the 6.25% Notes on May 15 and November 15 of each year, which commenced on November 15, 2020. The 6.25% Notes will mature on May 15, 2025. The 6.25% Notes are redeemable, in whole or in part, at any time on or after May 15, 2022 at the redemption prices specified in an indenture dated as of May 4, 2020 (the “6.25% Indenture”) plus accrued and unpaid interest. Prior to May 15, 2022, the Company may redeem some or all of the 6.25% Notes at a redemption price of 100% of the principal amount, plus accrued and unpaid interest, plus a “make-whole” premium as specified in the 6.25% Indenture. In addition, prior to May 15, 2022, the Company may redeem up to 35% of the aggregate principal amount of the 6.25% Notes with an amount not to exceed the maximum ratio allowednet cash proceeds from certain equity offerings at quarter-endsthe redemption price of 106.25% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. The 6.25% Notes are senior unsecured obligations of the Company, are guaranteed by certain of the Company’s domestic subsidiaries, and rank equally in right of payment with existing and future senior indebtedness of the Company and the Adjusted EBITDA to interest on Funded Debtguarantors (as defined in the Vail Holdings Credit Agreement) ratio6.25% Indenture).
The 6.25% Indenture requires that, upon the occurrence of a Change of Control (as defined in the 6.25% Indenture), the Company shall offer to purchase all of the outstanding 6.25% Notes at a purchase price in cash equal to 101% of the outstanding principal amount of the 6.25% Notes, plus accrued and unpaid interest. If the Company or certain of its subsidiaries dispose of assets, under certain circumstances, the Company will be required to either invest the net cash proceeds from such assets sales in its business within a specified period of time, repay certain senior secured debt or debt of its non-guarantor subsidiaries, or make an offer to purchase a principal amount of the 6.25% Notes equal to the excess net cash proceeds at a purchase price of 100% of their principal amount, plus accrued and unpaid interest.
The 6.25% Indenture contains covenants that, among other things, restrict the ability of the Company and the guarantors to incur liens on assets; merge or consolidate with another company or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of the Company’s assets or engage in Sale and Leaseback Transactions (as defined in the 6.25% Indenture). The 6.25% Indenture does not fall belowcontain any financial maintenance covenants. Certain of the minimum ratio allowedcovenants will not apply to the 6.25% Notes so long as the 6.25% Notes have investment grade ratings from two specified rating
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agencies and no event of default has occurred and is continuing under the 6.25% Indenture. The 6.25% Indenture includes customary events of default, including failure to make payment, failure to comply with the obligations set forth in the 6.25% Indenture, certain defaults on certain other indebtedness, certain events of bankruptcy, insolvency or reorganization, and invalidity of the guarantees of the 6.25% Notes issued pursuant to the 6.25% Indenture.
(c)On December 18, 2020, the Company completed an offering of $575.0 million in aggregate principal amount of 0.0% Convertible Notes due 2026 in a private placement conducted pursuant to Rule 144A of the Securities Act of 1933, as amended (the “0.0% Convertible Notes”). The 0.0% Convertible Notes were issued under an indenture dated December 18, 2020 (the “Convertible Indenture”) between the Company and U.S. Bank National Association, as Trustee. The 0.0% Convertible Notes do not bear regular interest and the principal amount does not accrete. The 0.0% Convertible Notes mature on January 1, 2026, unless earlier repurchased, redeemed or converted.
The 0.0% Convertible Notes are general senior unsecured obligations of the Company. The 0.0% Convertible Notes rank senior in right of payment to any future debt that is expressly subordinated, equal in right of payment with the Company’s existing and future liabilities that are not so subordinated, and are subordinated to all of the Company’s existing and future secured debt to the extent of the value of the assets securing such debt. The 0.0% Convertible Notes will also be structurally subordinated to all of the existing and future liabilities and obligations of the Company’s subsidiaries, including such subsidiaries’ guarantees of the 6.25% Notes.
The initial conversion rate was 2.4560 shares per $1,000 principal amount of notes (the “Conversion Rate”), which represents an initial conversion price of approximately $407.17 per share (the “Conversion Price”), and is subject to adjustment upon the occurrence of certain specified events as described in the Convertible Indenture. The principal amount of the 0.0% Convertible Notes is required to be settled in cash. The Company will settle conversions by paying cash, delivering shares of its common stock, or a combination of the two, at quarter-ends. its option.
Holders may convert their notes, at their option, only under the following circumstances:
•during any calendar quarter commencing after the calendar quarter ending on March 31, 2021 if the last reported sale price per share of our common stock exceeds 130% of the Conversion Price for each of at least 20 trading days (whether or not consecutive) during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter;
•during the five consecutive business days immediately after any 10 consecutive trading day period (such 10 consecutive trading day period, the “Measurement Period”) in which the trading price per $1,000 principal amount of notes for each trading day of the Measurement Period was less than 98% of the product of the last reported sale price per share of our common stock on such trading day and the Conversion Rate on such trading day;
•upon the occurrence of certain corporate events or distributions on our common stock, as described in the Convertible Indenture;
•if the Company calls the 0.0% Convertible Notes for redemption; or
•at any time from, and including, July 1, 2025 until the close of business on the scheduled trading day immediately before the maturity date.
The Vail Holdings0.0% Convertible Notes will be redeemable, in whole or in part, at the Company’s option at any time, and from time to time, on or after January 1, 2024 and on or before the 25th scheduled trading day immediately before the maturity date, at a cash redemption price equal to the principal amount of the notes to be redeemed, plus accrued and unpaid special and additional interest, if any, to, but excluding, the redemption date, but only if the last reported sale price per share of the Company’s common stock exceeds 130% of the Conversion Price for a specified period of time. If the Company elects to redeem less than all of the 0.0% Convertible Notes, at least $50.0 million aggregate principal amount of notes must be outstanding and not subject to redemption as of the relevant redemption notice date. Calling any 0.0% Convertible Notes for redemption will constitute a make-whole fundamental change with respect to such notes, in which case the Conversion Rate applicable to the conversion of such notes will be increased in certain circumstances if such notes are converted after they are called for redemption.
In addition, upon the occurrence of a fundamental change (as defined in the Convertible Indenture), holders of the 0.0% Convertible Notes may require the Company to repurchase all or a portion of their notes at a cash repurchase price equal to the principal amount of the notes to be repurchased, plus any accrued and unpaid special and additional interest, if any, to, but excluding, the applicable repurchase date. If certain fundamental changes referred to as make-whole fundamental changes (as defined in the Convertible Indenture) occur, the Conversion Rate for the 0.0% Convertible Notes may be increased for a specified period of time.
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The Convertible Indenture includes customary events of default, including failure to make payment, failure to comply with the obligations set forth in the Convertible Indenture, certain defaults on certain other indebtedness, and certain events of bankruptcy, insolvency or reorganization. The Company may elect, at its option, that the sole remedy for an event of default relating to certain failures by the Company to comply with certain reporting covenants in the Convertible Indenture will consist exclusively of the right of the holders of the 0.0% Convertible Notes to receive additional interest on the notes for up to 360 days following such failure.
The Company separately accounts for the liability and equity components of the 0.0% Convertible Notes. The liability component at issuance was recognized at estimated fair value based on the fair value of a similar debt instrument that does not have an embedded convertible feature, and was determined to be $465.3 million and was recorded within long-term debt, net on the Company’s Consolidated Balance Sheet. The excess of the principal amount of the 0.0% Convertible Notes over the initial fair value of the liability component represents a debt discount of $109.7 million and will be amortized to interest expense, net over the term. The balance of the unamortized debt discount was $97.2 million as of July 31, 2021. The carrying amount of the equity component representing the conversion option was approximately $109.7 million and was determined by deducting the initial fair value of the liability component from the total proceeds of the 0.0% Convertible Notes of $575.0 million. Additionally, the Company recorded deferred tax liabilities of approximately $27.5 million related to the equity component of the 0.0% Convertible Notes on the date of issuance, which decreased the recorded value of the equity component. The equity component is recorded within additional paid-in capital on the Company’s Consolidated Balance Sheet and is not remeasured as long as it continues to meet the conditions for equity classification.
Deferred financing costs related to the 0.0% Convertible Notes of approximately $14.9 million were allocated between the liability and equity components of the 0.0% Convertible Notes based on the proportion of the total proceeds allocated to the debt and equity components.
(d)Whistler Mountain Resort Limited Partnership (“Whistler LP”) and Blackcomb Skiing Enterprises Limited Partnership (“Blackcomb LP”), together “The WB Partnerships,” are party to a credit agreement, dated as of November 12, 2013 (as amended, the “Whistler Credit Agreement”), by and among Whistler LP, Blackcomb LP, certain subsidiaries of Whistler LP and Blackcomb LP party thereto as guarantors (the “Whistler Subsidiary Guarantors”), the financial institutions party thereto as lenders and The Toronto-Dominion Bank, as administrative agent. The Whistler Credit Agreement consists of a C$300.0 million revolving credit facility, and during the year ended July 31, 2020, the Company entered into an amendment of the Whistler Credit Agreement which extended the maturity date of the revolving credit facility to December 15, 2024. No other material terms of the Whistler Credit Agreement were altered. The WB Partnerships’ obligations under the Whistler Credit Agreement are guaranteed by the Whistler Subsidiary Guarantors and are collateralized by a pledge of the capital stock of the Whistler Subsidiary Guarantors and a pledge of substantially all of the assets of Whistler LP, Blackcomb LP and the Whistler Subsidiary Guarantors. In addition, pursuant to the terms of the Whistler Credit Agreement, the WB Partnerships have the ability to increase the commitment amount by up to C$75.0 million, subject to lender approval. Borrowings under the Whistler Credit Agreement are available in Canadian or U.S. dollars and bear interest annually, subject to an applicable margin based on the WB Partnerships’ Consolidated Total Leverage Ratio (as defined in the Whistler Credit Agreement), with pricing as of July 31, 2021, in the case of borrowings (i) in Canadian dollars, at the WB Partnerships’ option, either (a) at the Canadian Prime Rate plus 1.00% per annum or (b) by way of the issuance of bankers’ acceptances plus 2.00% per annum; and (ii) in U.S. dollars, at the WB Partnerships option, either at (a) the U.S. Base Rate plus 1.00% per annum or (b) Bankers Acceptance Rate plus 2.00% per annum. As of July 31, 2021, all borrowings under the Whistler Credit Agreement were made in Canadian dollars and by way of the issuance of bankers’ acceptances plus 2.00% (approximately 2.46% as of July 31, 2021). The Whistler Credit Agreement also includes a quarterly unused commitment fee based on the Consolidated Total Leverage Ratio, which as of July 31, 2021 is equal to 0.45% per annum.  The Whistler Credit Agreement provides for affirmative and negative covenants that restrict, among other things, the Company’sWB Partnerships’ ability to incur indebtedness and liens, dispose of assets, make capital expenditures, make distributions and make investments. In addition, the Vail HoldingsWhistler Credit Agreement includes the following restrictive financial covenants: Net Funded Debtcovenants (leverage ratios and interest coverage ratios) customary for facilities of this type.
(e)On September 24, 2019, in conjunction with the acquisition of Peak Resorts (see Note 7, Acquisitions), the Company assumed various secured borrowings (the “EPR Secured Notes”) under the master credit and security agreements and other related agreements, as amended, (collectively, the “EPR Agreements”) with EPT Ski Properties, Inc. and its affiliates (“EPR”). The EPR Secured Notes include the following:
i.The Alpine Valley Secured Note. The $4.6 million Alpine Valley Secured Note provides for interest payments through its maturity on December 1, 2034. As of July 31, 2021, interest on this note accrued at a rate of 11.38%.
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ii.The Boston Mills/Brandywine Secured Note. The $23.3 million Boston Mills/Brandywine Secured Note provides for interest payments through its maturity on December 1, 2034. As of July 31, 2021, interest on this note accrued at a rate of 10.91%.
iii.The Jack Frost/Big Boulder Secured Note. The $14.3 million Jack Frost/Big Boulder Secured Note provides for interest payments through its maturity on December 1, 2034. As of July 31, 2021, interest on this note accrued at a rate of 10.91%.
iv.The Mount Snow Secured Note. The $51.1 million Mount Snow Secured Note provides for interest payments through its maturity on December 1, 2034. As of July 31, 2021, interest on this note accrued at a rate of 11.96%.
v.The Hunter Mountain Secured Note. The $21.0 million Hunter Mountain Secured Note provides for interest payments through its maturity on January 5, 2036. As of July 31, 2021, interest on this note accrued at a rate of 8.72%.
The EPR Secured Notes are secured by all or substantially all of the assets of Peak Resorts and its subsidiaries, including mortgages on the Alpine Valley, Boston Mills, Brandywine, Jack Frost, Big Boulder, Mount Snow and Hunter Mountain ski resorts. The EPR Secured Notes bear interest at specified interest rates, as discussed above, which are subject to Adjusted EBITDAincrease each year by the lesser of (i) three times the percentage increase in the Consumer Price Index (“CPI”) or (ii) a capped index (the “Capped CPI Index”), which is 1.75% for the Hunter Mountain Secured Note and 1.50% for all other notes. The EPR Agreements provide for affirmative and negative covenants that restrict, among other things, the ability of Peak Resorts and its subsidiaries to incur indebtedness, dispose of assets, make distributions and make investments. In addition, the EPR Agreements include restrictive covenants, including maximum leverage ratio and Adjusted EBITDAconsolidated fixed charge ratio. An additional contingent interest payment would be due to EPR if, on a calendar year basis, the gross receipts from the properties securing any of the individual EPR Secured Notes (the “Gross Receipts”) are more than the result (the “Interest Quotient”) of dividing the total interest charges for the EPR Secured Notes by a specified percentage rate (the “Additional Interest Rate”). In such a case, the additional interest payment would equal the difference between the Gross Receipts and the Interest Quotient multiplied by the Additional Interest Rate. This calculation is made on Funded Debt ratio.
On August 15, 2018, VHI enteredan aggregated basis for the notes secured by the Jack Frost, Big Boulder, Boston Mills, Brandywine and Alpine Valley ski resorts, where the Additional Interest Rate is 10.0%; on a standalone basis for the note secured by the Company’s Mount Snow ski resort, where the Additional Interest Rate is 12.0%; and on a standalone basis for the note secured by the Company’s Hunter Mountain ski resort, where the Additional Interest Rate is 8.0%. Peak Resorts does not have the right to prepay the EPR Secured Notes. The EPR Secured Notes were recorded at their estimated fair value in conjunction with the acquisition of Peak Resorts on September 24, 2019. The EPR Agreements grant EPR certain other rights including (i) the option to purchase the Boston Mills, Brandywine, Jack Frost, Big Boulder or Alpine Valley resorts, which is exercisable no sooner than two years and no later than one year prior to the maturity dates of the applicable EPR Secured Note for such properties, with any closings to be held on the applicable maturity dates; and, if EPR exercises the purchase option, EPR will enter into an agreement with the Company for the lease of each acquired property for an initial term of 20 years, plus options to amendextend the lease for two additional periods of ten years each; (ii) a right of first refusal through 2021, subject to certain conditions, to provide all or a portion of the financing associated with any purchase, ground lease, sale/leaseback, management or financing transaction contemplated by Peak Resorts with respect to any new or existing ski resort properties; and restate in its entirety(iii) a right of first refusal through 2021 to purchase the Vail Holdings Credit Agreement, dated May 1, 2015,Company’s Attitash ski resort in the formevent the Company were to desire to sell the Attitash ski resort. To date, EPR has not exercised any such purchase options.
In addition, Peak Resorts is required to maintain a debt service reserve account which amounts are applied to fund interest payments and other amounts due and payable to EPR. As of July 31, 2021, the Company had funded the EPR debt service reserve account in an Eighth Amendedamount equal to approximately $5.2 million, which was included in other current assets in the Company’s Consolidated Balance Sheet.
(f)Peak Resorts serves as the general partner for two limited partnerships, Carinthia Group 1, LP and Restated Credit Agreement, dated August 15, 2018Carinthia Group 2, LP (together, the “Carinthia Partnerships”), which were formed to raise $52.0 million through the Immigrant Investor Program administered by the U.S. Citizenship and Immigration Services (“USCIS”), pursuant to the Immigration and Nationality Act (the “Amended Vail Holdings Credit Agreement”“EB-5 Program”). The Amended Vail Holdings Credit Agreement provides for (i) an unchanged revolvingEB-5 Program was created to stimulate the U.S. economy through the creation of jobs and capital investments in U.S. companies by foreign investors. The program allocates immigrant visas to qualified individuals (“EB-5 Investors”) seeking lawful permanent resident status based on their investment in a U.S commercial enterprise. On December 27, 2016, Peak Resorts borrowed $52.0 million from the Carinthia Partnerships to fund two capital projects at Mount Snow. The amounts were borrowed through two loan facility in an aggregate principal amount of $400.0agreements, which provided $30.0 million and (ii)$22.0 million (together, the “EB-5 Development Notes”). Amounts outstanding under the EB-5 Development Notes accrue simple interest at a term loan facility infixed rate of 1.0% per annum until the maturity date, which is December 27, 2021, subject to an aggregate principal amountextension of up to $950.0 million, which was increasedtwo additional years at the option of the borrowers, with lender consent. If the maturity date is extended,
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amounts outstanding under the EB-5 Development Notes will accrue simple interest at a fixed rate of 7.0% per annum during the first year of extension and a fixed rate of 10.0% per annum during the second year of extension. Upon an event of default (as defined), amounts outstanding under the EB-5 Development Notes shall bear interest at the rate of 5.0% per annum, subject to the extension increases. While the EB-5 Development Notes are outstanding, Peak Resorts is restricted from taking certain actions without the existing termconsent of the lenders, including, but not limited to, transferring or disposing of the properties or assets financed with loan facilityproceeds. In addition, Peak Resorts is prohibited from prepaying outstanding amounts owed if such prepayment would jeopardize any of $684.4 millionthe EB-5 Investors from being admitted to the U.S. via the EB-5 Program.
(g)The Company has recorded the outstanding debt of four Employee Housing Entities (each an “Employee Housing Entity” and collectively the “Employee Housing Entities”): Breckenridge Terrace, Tarnes, BC Housing and Tenderfoot. The proceeds of the Employee Housing Bonds were used to develop apartment complexes designated primarily for use by the Company’s seasonal employees at its Colorado mountain resorts. The Employee Housing Bonds are variable rate, interest-only instruments with interest rates tied to LIBOR plus 0% to 0.09% (0.09% to 0.18% as of July 31, 2018. Refer to Note 17, Subsequent Events, for additional information.
(b)The WB Partnerships (as defined in Note 5, Acquisitions) are party to a credit agreement, dated as of November 12, 2013 (as amended, the “Whistler Credit Agreement”), by and among Whistler Mountain Resort Limited Partnership (“Whistler LP”), Blackcomb Skiing Enterprises Limited Partnership (“Blackcomb LP”), certain subsidiaries of Whistler LP and Blackcomb LP party thereto as guarantors (the “Whistler Subsidiary Guarantors”), the financial institutions party thereto as lenders and The Toronto-Dominion Bank, as administrative agent.  The Whistler Credit Agreement consists of a C$300.0 million revolving credit facility, and during the year ended July 31, 2018, the Company exercised its right under the Whistler Credit Agreement, with the consent of the lender parties thereto, to extend the maturity date for the Whistler Credit Agreement from November 12, 2021 to November 12, 2022. No other terms of the Whistler Credit Agreement were altered. The WB Partnerships’ obligations under the Whistler Credit Agreement are guaranteed by the Whistler Subsidiary Guarantors and are collateralized by a pledge of the capital stock of the Whistler Subsidiary Guarantors and a pledge of substantially all of the assets of Whistler LP, Blackcomb LP and the Whistler Subsidiary Guarantors. In addition, pursuant to the terms of the Whistler Credit Agreement, the WB Partnerships have the ability to increase the commitment amount by up to C$75.0 million subject to lender approval. Borrowings under the Whistler Credit Agreement are available in Canadian or U.S. dollars and bear interest annually, subject to an applicable margin based on the WB Partnerships’ Consolidated Total Leverage Ratio (as defined in the Whistler Credit Agreement), with pricing as of July 31, 2018, in the case of borrowings (i) in Canadian dollars, at the WB Partnerships’ option, either (a) at the Canadian Prime Rate plus 0.75% per annum or (b) by way of the issuance of bankers’ acceptances plus 1.75% per annum; and (ii) in U.S. dollars, at the WB Partnerships option, either at (a) the U.S. Base Rate plus 0.75% per annum or (b) Bankers Acceptance Rate plus 1.75% per annum. As of July 31, 2018 all borrowings under the Whistler Credit Agreement were made in Canadian dollars and by way of the issuance of bankers’ acceptances plus 1.75% (3.54% as of July 31, 2018). The Whistler Credit Agreement also includes a quarterly unused commitment fee based on the Consolidated Total Leverage Ratio, which as of July 31, 2018 is equal to 0.3937% per annum.  The Whistler Credit Agreement provides for affirmative and negative covenants that restrict, among other things, the WB Partnerships’ ability to incur indebtedness and liens, dispose of assets, make capital expenditures, make distributions and make investments. In addition, the Whistler Credit Agreement includes the restrictive financial covenants (leverage ratios and interest coverage ratios) customary for facilities of this type.
(c)The Company has recorded the outstanding debt of four Employee Housing Entities (each an “Employee Housing Entity” and collectively the “Employee Housing Entities”): Breckenridge Terrace, Tarnes, BC Housing and Tenderfoot. The proceeds of the Employee Housing Bonds were used to develop apartment complexes designated primarily for use by the Company’s seasonal employees at its Colorado mountain resorts. The Employee Housing Bonds are variable rate, interest-only instruments with interest rates tied to LIBOR plus 0% to 0.04% (2.08% to 2.12% as of July 31, 2018).

2021).

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Interest on the Employee Housing Bonds is paid monthly in arrears and the interest rate is adjusted weekly. No principal payments are due on the Employee Housing Bonds until maturity. Each Employee Housing Entity’s bonds were issued in two series. The bonds for each Employee Housing Entity are backed by letters of credit issued under the Vail Holdings Credit Agreement. The table below presents the principal amounts outstanding for the Employee Housing Bonds as of July 31, 20182021 (in thousands):    
Maturity (a)Tranche ATranche BTotal
Breckenridge Terrace2039$14,980 $5,000 $19,980 
Tarnes20398,000 2,410 10,410 
BC Housing20279,100 1,500 10,600 
Tenderfoot20355,700 5,885 11,585 
Total $37,780 $14,795 $52,575 

(h)On May 24, 2013, VR CPC Holdings, Inc. (“VR CPC”), a wholly-owned subsidiary of the Company, entered into a transaction agreement with affiliate companies of Talisker Corporation (“Talisker”) pursuant to which the parties entered into a master lease agreement (the “Lease”) and certain ancillary transaction documents on May 29, 2013 related to the former stand-alone Canyons Resort (“Canyons”), pursuant to which the Company assumed the resort operations of the Canyons. The Lease between VR CPC and Talisker has an initial term of 50 years with six 50-year renewal options. The Lease provides for $25 million in annual payments, which increase each year by an inflation-linked index of CPI less 1% per annum, with a floor of 2%. Vail Resorts has guaranteed the payments under the Lease. The obligation at July 31, 2021 represents future lease payments for the remaining initial lease term of 50 years (including annual increases at the floor of 2%) discounted using an interest rate of 10%, and includes accumulated accreted interest expense of approximately $46.5 million.
(d)On May 24, 2013, VR CPC Holdings, Inc. (“VR CPC”), a wholly-owned subsidiary of the Company, entered into a transaction agreement with affiliate companies of Talisker Corporation (“Talisker”) pursuant to which the parties entered into a master lease agreement (the “Lease”) and certain ancillary transaction documents on May 29, 2013 related to the former stand-alone Canyons Resort (“Canyons”), pursuant to which the Company assumed the resort operations of the Canyons. The Lease between VR CPC and Talisker has an initial term of 50 years with six 50-year renewal options. The Lease provides for $25 million in annual payments, which increase each year by an inflation linked index of CPI less 1%, with a floor of 2% per annum. Vail Resorts has guaranteed the payments under the Lease. The obligation at July 31, 2018 represents future lease payments for the remaining initial lease term of 50 years (including annual increases at the floor of 2%) discounted using an interest rate of 10%, and includes accumulated accreted interest expense of $29.2 million.
(i)During the year ended July 31, 2019, the Company completed two real estate sales transactions that were accounted for as financing arrangements as a result of the Company’s continuing involvement with the underlying assets that were sold, including but not limited to, the obligation to repurchase finished commercial space from the development projects upon completion. The Company received approximately $11.7 million of proceeds for these sales transactions through the year ended July 31, 2021, which are reflected within long-term debt, net. Other obligations also consist of a $3.3 million note outstanding to the Colorado Water Conservation Board, which matures on September 16, 2028, and other financing arrangements. Other obligations, including the Colorado Water Conservation Board note, bear interest at rates ranging from 5.1% to 5.5%.
(e)Other obligations primarily consist of a $4.2 million note outstanding to the Colorado Water Conservation Board, which matures on September 16, 2028, and other financing arrangements. Other obligations, including the Colorado Water Conservation Board note, bear interest at rates ranging from 5.1% to 5.5%.

(j)In connection with the issuance of the 0.0% Convertible Notes, the Company recorded a debt discount, which represents the excess of the principal amount of the 0.0% Convertible Notes over the fair value of the liability component, as discussed above. In connection with the acquisition of Peak Resorts, the Company estimated the acquisition date fair values of the debt instruments assumed, including the EPR Secured Notes and the EB-5 Development Notes, and recorded any difference between such estimated fair values and the par value of debt instruments as unamortized premiums and discounts, which is amortized and recorded to interest expense, net on the Company’s Consolidated Statements of Operations over the respective term of the applicable debt instruments. Additionally, certain costs incurred with regard to the issuance of debt instruments are capitalized and included as a reduction in the net carrying value of long-term debt, net of accumulated amortization, with the exception of costs incurred related to line-of-credit arrangements, which are included in deferred charges and other assets, net of accumulated amortization. Amortization of such deferred financing costs are
(f)Current maturities represent principal payments due in the next 12 months.
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recorded to interest expense, net on the Company’s Consolidated Statements of Operations over the respective term of the applicable debt instruments.
(k)Current maturities represent principal payments due in the next 12 months, and exclude approximately $6.2 million of proceeds resulting from a real estate transaction accounted for as a financing arrangement, as discussed above, which are expected to be recognized on the Company’s Statement of Operations during the year ending July 31, 2022 as a result of the anticipated resolution of continuing involvement, with no associated cash outflow.
Aggregate maturities for debt outstanding, including capitalfinance lease obligations, as of July 31, 20182021 reflected by fiscal year are as follows (in thousands):
  
Total
2022 (1)
$121,345 
202363,740 
202463,798 
20251,598,774 
2026575,415 
Thereafter525,442 
Total debt$2,948,514 
  
Total
2019$38,455
202038,516
202138,580
2022703,023
202366,572
Thereafter390,936
Total debt$1,276,082

(1) Includes approximately $6.2 million of proceeds resulting from a real estate transaction accounted for as a financing arrangement, as discussed above, which are expected to be recognized on the Company’s Statement of Operations during the year ending July 31, 2022 as a result of the anticipated resolution of continuing involvement, with no associated cash outflow.
The Company recorded interest expense of $63.2$151.4 million, $54.1$106.7 million and $42.4$79.5 million for the years ended July 31, 2018, 20172021, 2020 and 2016,2019, respectively, of which $1.3$4.9 million, $1.1$1.9 million and $1.0$1.3 million, respectively, was amortization of deferred financing costs. The Company was in compliance with all of its financial and operating covenants required to be maintained under its debt instruments for all periods presented.

In connection with the acquisition of Whistler Blackcomb in October 2016, VHI funded a portion of the purchase price through an intercompany loan to Whistler Blackcomb of $210.0 million, which was effective as of November 1, 2016 and requires foreign currency remeasurement to Canadian dollars, the functional currency for Whistler Blackcomb. As a result, foreign currency fluctuations associated with the loan are recorded within the Company’s results of operations. The Company recognized approximately $(9.0)$8.3 million, $(3.2) million and $15.3$(2.9) million of non-cash foreign currency gain (loss) gain on the intercompany loan to Whistler Blackcomb during the years ended July 31, 20182021, 2020 and 2017,2019, respectively, on the Company’s Consolidated Statements of Operations.


7.     Acquisitions
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5.Acquisitions
StowePeak Resorts
On June 7, 2017,September 24, 2019, the Company, through a wholly-owned subsidiary, acquired Stowe100% of the outstanding stock of Peak Resorts, Inc. (“Peak Resorts”) at a purchase price of $11.00 per share or approximately $264.5 million. In addition, contemporaneous with the closing of the transaction, Peak Resorts was required to pay approximately $70.2 million of certain outstanding debt instruments and lease obligations in order to complete the transaction. Accordingly, the total purchase price, including the repayment of certain outstanding debt instruments and lease obligations, was approximately $334.7 million, for which the Company borrowed approximately $335.6 million under the Vail Holdings Credit Agreement (see Note 6, Long-Term Debt) to fund the acquisition, repayment of debt instruments and lease obligations, and associated acquisition related expenses. The acquired resorts include: Mount Snow in Vermont; Hunter Mountain in New York; Attitash Mountain Resort, Wildcat Mountain and Crotched Mountain in Stowe, Vermont, from Mt. Mansfield Company, Inc., a wholly-owned subsidiary of American International Group, Inc., for total cash consideration of $40.7 million.New Hampshire; Liberty Mountain Resort, Roundtop Mountain Resort, Whitetail Resort, Jack Frost and Big Boulder in Pennsylvania; Alpine Valley, Boston Mills, Brandywine and Mad River Mountain in Ohio; Hidden Valley and Snow Creek in Missouri; and Paoli Peaks in Indiana. The Company acquired all ofassumed the assets related toSpecial Use Permits from the U.S. Forest Service for Attitash, Mount Snow and Wildcat Mountain, and assumed the land leases for Mad River and Paoli Peaks. The acquisition included the mountain operations of the resort,resorts, including base area skier services (food and beverage, retail and rental, lift ticket offices and ski and snowboard school facilities). The purchase price was allocated to identifiable tangible and intangible assets acquired based on their estimated fair values, as well as lodging operations at the acquisition date. The Company has completed its purchase price allocation and has recorded $39.2 million in property, plant and equipment; $3.0 million in intangible assets; $2.3 million in other assets; and $3.8 million of assumed liabilities on the date of acquisition. The Company recognized $2.0 million of transaction related expenses associated with the transaction in Mountain and Lodging operating expense in the Consolidated Statements of Operations for the year ended July 31, 2017. The operating results of Stowe are reported within the Mountain segment.

Whistler Blackcomb
On October 17, 2016, the Company, through Exchangeco, acquired all of the outstanding common shares of Whistler Blackcomb, for aggregate purchase consideration paid to Whistler Blackcomb shareholders of $1.09 billion. The consideration paid consisted of (i) approximately C$673.8 million ($512.6 million) in cash (or C$17.50 per Whistler Blackcomb share), (ii) 3,327,719 Vail Shares and (iii) 418,095 Exchangeco Shares.  Each Exchangeco Share is exchangeable by the holder thereof for one Vail Share (subject to customary adjustments for stock splits or other reorganizations). In addition, the Company may require all outstanding Exchangeco Shares to be exchanged into an equal number of Vail Shares upon the occurrence of certain events and at any time following the seventh anniversary of the closing of the acquisition. While outstanding, holders of Exchangeco Shares are entitled to cast votes on matters for which holders of Vail Shares are entitled to vote and are entitled to receive dividends economically equivalent to the dividends declared by the Company with respect to the Vail Shares.

Whistler Blackcomb owns a 75% interest in each of Whistler LP and Blackcomb LP (the “WB Partnerships”), which together operate Whistler Blackcomb resort, a year round mountain resort in British Columbia, Canada with a comprehensive offering of recreational activities, including both snow sports and summer activities. The remaining 25% limited partnership interest in each of the WB Partnerships is owned by Nippon Cable Co. Ltd. (“Nippon Cable”), an unrelated party to the Company. The WB Partnerships hold land leases and rights-of-way under long-term agreements with the government of the province of British Columbia, Canada within the traditional territory of the Squamish and Lil’wat Nations, which provide for the use of land at Whistler Mountain and Blackcomb Mountain.

The Company executed forward contracts for the underlying Canadian dollar cash consideration to economically hedge the risk associated with the U.S. dollar to Canadian dollar exchange rates. The Company’s total cost was $509.2 million to accumulate C$673.8 million which was required for the cash component of the purchase consideration. The estimated fair value of the Canadian dollars was approximately $512.6 million upon settlement. Accordingly, the Company realized a gain of $3.4 million on foreign currency exchange rate changes. The gain on foreign currency is a separate transaction as it primarily benefited the Company and therefore the Company recorded this gain within Investment income and other, net in its Consolidated Statement of Operations for the year ended July 31, 2017. The estimated fair value of $512.6 million is considered the cash component of the purchase consideration.

The Company held shares of Whistler Blackcomb common stock prior to the acquisition and, as such, the acquisition-date estimated fair value of this previously held investment was a component of the purchase consideration. Based on the acquisition-date estimated fair value of this investment of $4.3 million, the Company recorded a gain of $0.8 million within Investment income and other, net in its Consolidated Statement of Operations for the year ended July 31, 2017.

Nippon Cable’s 25% limited partnership interest is a noncontrolling economic interest containing certain protective rights and no ability to participate in the day to day operations of the WB Partnerships. The WB Partnership agreements provide that distributions made out of the partnerships be made on the basis of 75% to Whistler Blackcomb and 25% to Nippon Cable. In addition, based upon the terms of the WB Partnership agreements, the annual distribution rights are non-transferable and transfer of the limited partnership interest is limited to Nippon Cable’s entire interest. Accordingly, the estimate of fair value associated with the noncontrolling interest at the date of acquisition has been determined based on expected underlying cash flows of the WB Partnerships discounted at a rate commensurate with a market participant’s expected rate of return for an equity instrument with these associated restrictions.


resorts.
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The following summarizes the purchase consideration and the purchase price allocation to estimated fair values of the identifiable assets acquired and liabilities assumed at the date the transaction was effective (in thousands, except exchange ratiothousands):
Acquisition Date Estimated Fair Value
Current assets$19,578 
Property, plant and equipment427,793 
Goodwill135,879 
Identifiable intangible assets19,221 
Other assets16,203 
Assumed long-term debt(184,668)
Other liabilities(99,275)
Net assets acquired$334,731 
Identifiable intangible assets acquired in the transaction were primarily related to trade names and share price):
(in thousands, except exchange ratio and share price amounts) Acquisition Date Estimated Fair Value
Total Whistler Blackcomb shares acquired 38,500
Exchange ratio as of October 14, 2016 0.097294
Total Vail Resorts shares issued to Whistler Blackcomb shareholders 3,746
Vail Resorts closing share price on October 14, 2016 $153.41
Total value of Vail Resorts shares issued $574,645
Total cash consideration paid at C$17.50 ($13.31 on October 17, 2016) per Whistler Blackcomb share 512,558
Total purchase consideration to Whistler Blackcomb shareholders 1,087,203
Estimated fair value of previously held investment in Whistler Blackcomb 4,308
Estimated fair value of Nippon Cable’s 25% interest in Whistler Blackcomb 180,803
Total estimated purchase consideration $1,272,314
   
Allocation of total estimated purchase consideration:  
Estimated fair values of assets acquired:  
Current assets $36,820
Property, plant and equipment 332,609
Real estate held for sale and investment 8,216
Goodwill 956,459
Identifiable intangibles 150,681
Deferred income taxes, net 7,992
Other assets 1,973
Current liabilities (74,358)
Assumed long-term debt (144,922)
Other long-term liabilities (3,156)
Net assets acquired $1,272,314

Duringproperty management contracts, which had acquisition date estimated fair values of approximately $15.8 million and $3.1 million, respectively. The process of estimating the fair value of the depreciable property, plant, and equipment includes the use of certain estimates and assumptions related to replacement cost. The excess of the purchase price over the aggregate estimated fair values of the assets acquired and liabilities assumed was recorded as goodwill. The goodwill recognized is attributable primarily to expected synergies, the assembled workforce of the resorts and other factors, and is not expected to be deductible for income tax purposes. The Company assumed various debt obligations of Peak Resorts, which were recorded at their respective estimated fair values as of the acquisition date (see Note 6, Long-Term Debt). The Company incurred $3.1 million of acquisition related expenses associated with the transaction which were recorded within Mountain and Lodging operating expense in its Consolidated Statement of Operations for the year ended July 31, 2018,2020. The operating results of Peak Resorts are reported within the Mountain and Lodging segments prospectively from the date of acquisition.
Falls Creek and Hotham Resorts
On April 4, 2019, the Company, recordedthrough a wholly-owned subsidiary, acquired ski field leases and related infrastructure used to operate two resorts in Victoria, Australia. The Company acquired Australian Alpine Enterprises Holdings Pty. Ltd and all related corporate entities that operate the Falls Creek and Hotham resorts from Living and Leisure Australia Group, a subsidiary of Merlin Entertainments, for a cash purchase price of approximately AU$178.9 million ($127.4 million), after adjustments for certain agreed-upon terms, including an increase in the measurementpurchase price for operating losses incurred for the period to itsfrom December 29, 2018 through closing. The acquisition included the mountain operations of both resorts, including base area skier services (ski school facilities, retail and rental, reservation and property management operations).
The following summarizes the purchase consideration and the purchase price allocation which decreased the estimated fair value of noncontrolling interest and season pass holder relationships intangible asset with a corresponding net decrease to goodwill.

The estimated fair values of definite-livedthe identifiable assets acquired and indefinite-lived identifiableliabilities assumed at the date the transaction was effective (in thousands):
Acquisition Date Estimated Fair Value
Current assets$6,986 
Property, plant and equipment54,889 
Goodwill71,538 
Identifiable intangible assets and other assets5,833 
Liabilities(11,894)
Net assets acquired$127,352 
Identifiable intangible assets acquired in the transaction were determined using significantprimarily related to trade names. The process of estimating the fair value of the property, plant, and equipment includes the use of certain estimates and assumptions. The estimated fair valueassumptions related to replacement cost and estimated useful livesphysical condition at the time of identifiable intangible assets, where applicable, are as follows.
 Estimated Fair Value Weighted Average Amortization Period
 ($ in thousands) 
(in years) (1)
Trademarks$139,977
 n/a
Season pass holder relationships6,596
 5
Property management contracts4,108
 n/a
Total acquired identifiable intangible assets$150,681
  
(1) Trademarks and property management contracts are indefinite-lived intangible assets.

acquisition. The excess of the purchase considerationprice over the aggregate estimated fair values of assets acquired and liabilities assumed was recorded as goodwill. The goodwill recognized is attributable primarily to expected cost efficiencies from the elimination of certain public company costs as well as other select areas of general and administrative functions, synergies, including utilization of the Company’s yield management strategies at Whistler Blackcomb and increased season pass sales and visitation across the Company’s resort portfolio, the assembled workforce of Whistler BlackcombFalls Creek and Hotham and other factors. TheNone of the goodwill is notexpected to
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be deductible for income tax purposes. The operating results of Whistler Blackcomb, which are primarily recorded in the Mountain segment, contributed $257.8 million of net revenue and $65.6 million of earnings for the year ended July 31, 2017, prospectively from the acquisition date of

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October 17, 2016.purposes under Australian tax law. The Company recognized $3.2$4.6 million of Whistler Blackcomb transactionacquisition related expenses inassociated with the transaction, including stamp duty expense of $2.9 million, within Mountain and Lodging operating expense in theits Consolidated Statement of Operations for the year ended July 31, 2017.2019. The operating results of Falls Creek and Hotham are reported within the Mountain segment prospectively from the date of acquisition.

Triple Peaks
On February 23, 2017, Whistler LP, by its general partner Whistler Blackcomb Holdings Inc. (“WBHI”),September 27, 2018, the Company, through a wholly-owned subsidiary, acquired Triple Peaks, LLC (“Triple Peaks”), the parent company of Okemo Mountain Resort in Vermont, Crested Butte Mountain Resort in Colorado, and Mount Sunapee Resort in New Hampshire, for a cash purchase price of approximately $74.1 million, after adjustments for certain agreed-upon terms. In addition, contemporaneous with the closing of the transaction, Triple Peaks paid $155.0 million to pay the remaining obligations of the leases that all three resorts had with Ski Resort Holdings, with funds provided by the Company. Accordingly, the total purchase price, including the repayment of lease obligations, was $229.1 million, for which the Company entered intoutilized cash on hand and borrowed $195.6 million under the Vail Holdings Credit Agreement term loan (see Note 6, Long-Term Debt) to fund the transaction and associated acquisition related expenses. The Company obtained a master development agreement (the “Whistler MDA”) with Her Majesty,new Special Use Permit from the QueenU.S. Forest Service for Crested Butte, and assumed the state land leases for Okemo and Mount Sunapee. The acquisition included the mountain operations of the resorts, including base area skier services (food and beverage, retail and rental, lift ticket offices and ski school facilities).
The following summarizes the purchase consideration and the purchase price allocation to estimated fair values of the identifiable assets acquired and liabilities assumed at the date the transaction was effective (in thousands):
Acquisition Date Estimated Fair Value
Current assets$5,197 
Property, plant and equipment159,799 
Goodwill51,742 
Identifiable intangible assets27,360 
Deferred income taxes, net3,093 
Liabilities(18,098)
Net assets acquired$229,093 
Identifiable intangible assets acquired in Rightthe transaction were primarily related to property management contracts and trade names. The process of British Columbia (the “Province”) with respectestimating the fair value of the property, plant, and equipment includes the use of certain estimates and assumptions related to replacement cost and physical condition at the operationtime of acquisition. The excess of the purchase price over the aggregate estimated fair values of assets acquired and developmentliabilities assumed was recorded as goodwill. The goodwill recognized is attributable primarily to expected synergies, the assembled workforce of Whistler Mountain. Additionally, on February 23, 2017, Blackcomb LP, by its general partner WBHI, entered into a master development agreement (the “Blackcomb MDA”the resorts and togetherother factors, and is expected to be deductible for income tax purposes. The Company recognized $2.8 million of acquisition related expenses associated with the Whistler MDA,transaction within Mountain and Lodging operating expense in its Consolidated Statement of Operations for the “MDAs”year ended July 31, 2019. The operating results of Triple Peaks are reported within the Mountain and Lodging segments prospectively from the date of acquisition.
Stevens Pass Resort
On August 15, 2018, the Company, through a wholly-owned subsidiary, acquired Stevens Pass Resort in the State of Washington from Ski Resort Holdings, LLC, an affiliate of Oz Real Estate (“Ski Resort Holdings”), for total cash consideration of $64.0 million, after adjustments for certain agreed-upon terms. The Company borrowed $70.0 million on August 15, 2018 under its Vail Holdings Credit Agreement term loan (see Note 6, Long-Term Debt) to fund the transaction and associated acquisition related expenses. The acquisition included the mountain operations of the resort, including base area skier services (food and beverage, retail and rental, lift ticket offices and ski school facilities).
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The following summarizes the purchase consideration and the purchase price allocation to estimated fair values of the identifiable assets acquired and liabilities assumed at the date the transaction was effective (in thousands):
Acquisition Date Estimated Fair Value
Current assets$752 
Property, plant and equipment34,865 
Goodwill28,878 
Identifiable intangible assets2,680 
Deferred income taxes, net886 
Liabilities(4,029)
Net assets acquired$64,032 
The process of estimating the fair value of the property, plant, and equipment includes the use of certain estimates and assumptions related to replacement cost and physical condition at the time of acquisition. The excess of the purchase price over the aggregate estimated fair values of assets acquired and liabilities assumed was recorded as goodwill. The goodwill recognized is attributable primarily to expected synergies, the assembled workforce of Stevens Pass and other factors, and is expected to be deductible for income tax purposes. The Company recognized $1.2 million of acquisition related expenses associated with the Province with respect to the operationtransaction within Mountain and developmentLodging operating expense in its Consolidated Statement of Blackcomb Mountain. Each of Whistler LP and Blackcomb LP were operating under existing master development agreements that terminated upon execution of the new MDAs. The MDAs grant a general license to the WB Partnerships to use the Whistler Mountain lands and the Blackcomb Mountain landsOperations for the operation and developmentyear ended July 31, 2019. The operating results of Stevens Pass are reported within the Whistler Blackcomb Resort. Each WB Partnership is permitted to develop new improvements to Whistler Mountain or Blackcomb Mountain, assegment prospectively from the case may be, within standard municipal type development control conditions. The MDAs each have a termdate of 60 years and are replaceable for an additional 60 years by option exercisable by the WB Partnerships after the first 30 years of the initial term. In accordance with the MDAs, each WB Partnership is obligated to pay annual fees to the Province at a percentage certain gross revenues related to the Whistler Blackcomb Resort.acquisition.
Whistler Blackcomb Pro Forma Financial Information
The following presents the unaudited pro forma consolidated financial information of the Company as if the acquisitions of Peak Resorts, Falls Creek and Hotham, Triple Peaks and Stevens Pass were completed at the beginning of the fiscal year preceding the respective fiscal year in which each acquisition of Whistler Blackcomb was completed on August 1, 2015.occurred. The following unaudited pro forma financial information includes adjustments for (i) depreciation on acquired property, plant and equipment; (ii) amortization of intangible assets recorded at the date of the transactions; (iii) lease expenses incurred by the prior owners which the Company will not be subject to; (iv) transaction and business integration related costs; (iv)and (v) interest expense associated with financing the cash portion of the acquisition; and (v) total weighted average shares outstanding related to the acquisition; and excludes the impact of the intercompany loan.transactions. This unaudited pro forma financial information is presented for informational purposes only and does not purport to be indicative of the results of future operations or the results that would have occurred had the transaction taken place on August 1, 2015at the beginning of the fiscal year preceding the fiscal year in which each acquisition occurred (in thousands, except per share amounts).
  Year Ended July 31,
  20172016
Pro forma net revenue $1,929,882
$1,835,924
Pro forma net income attributable to Vail Resorts, Inc. $212,475
$170,855
Pro forma basic net income per share attributable to Vail Resorts, Inc. $5.31
$4.27
Pro forma diluted net income per share attributable to Vail Resorts, Inc. $5.16
$4.16

Wilmot Mountain
On January 19, 2016, the Company, through a wholly-owned subsidiary, acquired all of the assets of Wilmot, a ski area located in Wisconsin near the Illinois state line, for total cash consideration of $20.2 million. The purchase price was allocated to identifiable tangible and intangible assets acquired and liabilities assumed based on their estimated fair value at the acquisition date. The Company has completed its purchase price allocation and has recorded $12.5 million in property, plant and equipment, $0.2 million in other assets, $0.4 million in other intangible assets (with a weighted-average amortization period of 10 years at the date of acquisition) and $0.3 million of assumed liabilities on the date of acquisition. The excess of the purchase price over the aggregate fair value of assets acquired and liabilities assumed was $7.4 million and was recorded as goodwill. The goodwill recognized is attributable primarily to expected synergies, the assembled workforce of Wilmot and other factors. The goodwill is deductible for income tax purposes. The operating results of Wilmot are reported within the Mountain segment.


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Year Ended July 31, 2020
6.Pro forma net revenueSupplementary Balance Sheet Information$1,970,363 
Pro forma net income attributable to Vail Resorts, Inc.$100,205 
Pro forma basic net income per share attributable to Vail Resorts, Inc.$2.49 
Pro forma diluted net income per share attributable to Vail Resorts, Inc.$2.45 

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8.    Supplementary Balance Sheet Information
The composition of property, plant and equipment, including capitalfinance lease assets, follows (in thousands):
July 31, July 31,
20182017
20212020
Land and land improvements$552,271
$553,655
Land and land improvements$756,517 $750,714 
Buildings and building improvements1,193,528
1,210,864
Buildings and building improvements1,496,402 1,475,661 
Machinery and equipment1,007,250
987,080
Machinery and equipment1,417,705 1,361,178 
Furniture and fixtures283,694
280,292
Furniture and fixtures308,432 308,267 
Software113,699
108,048
Software122,778 104,223 
Vehicles60,697
59,596
Vehicles80,328 80,510 
Construction in progress59,579
49,359
Construction in progress67,710 81,967 
Gross property, plant and equipment3,270,718
3,248,894
Gross property, plant and equipment4,249,872 4,162,520 
Accumulated depreciation(1,643,499)(1,534,740)Accumulated depreciation(2,181,996)(1,969,841)
Property, plant and equipment, net$1,627,219
$1,714,154
Property, plant and equipment, net$2,067,876 $2,192,679 
Depreciation expense, which included depreciation of assets recorded under capitalfinance leases, for the years ended July 31, 2018, 20172021, 2020 and 20162019 totaled $199.2$247.2 million, $180.8$243.1 million, and $156.8$210.7 million, respectively.
The following table showssummarizes the composition of property, plant and equipment recorded under capitalfinance leases as of July 31, 20182021 and 20172020 (in thousands):

July 31,
20212020
Land$31,818 $31,818 
Land improvements49,228 49,228 
Buildings and building improvements42,160 42,160 
Machinery and equipment60,384 60,384 
Gross property, plant and equipment183,590 183,590 
Accumulated depreciation(75,545)(65,792)
Property, plant and equipment, net$108,045 $117,798 
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 July 31,
 20182017
Land$31,818
$31,818
Land improvements49,228
49,228
Buildings and building improvements42,660
42,910
Machinery and equipment60,384
61,156
Gross property, plant and equipment184,090
185,112
Accumulated depreciation(46,502)(37,000)
Property, plant and equipment, net$137,588
$148,112

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The composition of goodwill and intangible assets follows (in thousands):

July 31, July 31,
20182017
20212020
Goodwill Goodwill
Goodwill$1,493,040
$1,537,097
Goodwill$1,824,089 $1,752,062 
Accumulated impairmentsAccumulated impairments(25,688)(25,688)
Accumulated amortization(17,354)(17,354)Accumulated amortization(17,354)(17,354)
Goodwill, net$1,475,686
$1,519,743
Goodwill, net$1,781,047 $1,709,020 
 
Indefinite-lived intangible assets Indefinite-lived intangible assets
Trademarks$205,083
$216,923
Trademarks$239,786 $230,000 
Other41,160
41,275
Other41,561 41,667 
Total gross indefinite-lived intangible assets246,243
258,198
Total gross indefinite-lived intangible assets281,347 271,667 
Accumulated amortization(24,713)(24,713)Accumulated amortization(24,713)(24,713)
Indefinite-lived intangible assets, net221,530
233,485
Indefinite-lived intangible assets, net$256,634 $246,954 
Amortizable intangible assets Amortizable intangible assets
Trademarks42,971
39,071
Trademarks$38,008 $38,208 
Other47,604
49,804
Other69,397 70,772 
Total gross amortizable intangible assets90,575
88,875
Total gross amortizable intangible assets107,405 108,980 
Accumulated amortization(31,533)(27,428)Accumulated amortization(44,929)(41,158)
Amortizable intangible assets, net59,042
61,447
Amortizable intangible assets, net62,476 67,822 
Total gross intangible assets336,818
347,073
Total gross intangible assets388,752 380,647 
Total accumulated amortization(56,246)(52,141)Total accumulated amortization(69,642)(65,871)
Total intangible assets, net$280,572
$294,932
Total intangible assets, net$319,110 $314,776 
Amortization expense for intangible assets subject to amortization for the years ended July 31, 2018, 20172021, 2020 and 20162019 totaled $5.3$5.4 million, $8.3$6.5 million and $4.7$7.4 million, respectively, and is estimated to be approximately $2.8$4.1 million annually, on average, for the next five fiscal years.
The changes in the net carrying amount of goodwill allocated between the Company’s segments for the years ended July 31, 20182021 and 20172020 are as follows (in thousands):

MountainLodgingGoodwill, net
Balance at July 31, 2019$1,540,307 $67,899 $1,608,206 
Acquisitions (including measurement period adjustments)135,987 — 135,987 
Asset impairments— (25,688)(25,688)
Effects of changes in foreign currency exchange rates(9,485)— (9,485)
Balance at July 31, 20201,666,809 42,211 1,709,020 
Effects of changes in foreign currency exchange rates72,027 — 72,027 
Balance at July 31, 2021$1,738,836 $42,211 $1,781,047 
Asset Impairments
The Company recorded asset impairments during the year ended July 31, 2020 of $28.4 million, with corresponding reductions to goodwill, net of $25.7 million and intangible assets, net and property, plant and equipment, net of $2.7 million. These asset impairments encompassed various estimates and assumptions about fair value, which were based predominately on significant unobservable inputs.
As a result of COVID-19 and the impact it had on the Company’s operations during the year ended July 31, 2020, the Company determined that the estimated fair value of its Colorado resort ground transportation company reporting unit within its Lodging
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 MountainLodgingGoodwill, net
Balance at July 31, 2016$441,138
$67,899
$509,037
Acquisitions956,739
—
956,739
Effects of changes in foreign currency exchange rates53,967
—
53,967
Balance at July 31, 20171,451,844
67,899
1,519,743
Acquisitions (including measurement period adjustments)344
—
344
Effects of changes in foreign currency exchange rates(44,401)—
(44,401)
Balance at July 31, 2018$1,407,787
$67,899
$1,475,686

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segment no longer exceeded its carrying value. Additionally, the Company determined that certain long-lived assets of its Colorado resort ground transportation company were not recoverable. As a result, the Company recognized impairments of goodwill of approximately $25.7 million and intangible assets and long-lived assets of $2.7 million, which were recorded within asset impairments on the Company’s Consolidated Statement of Operations during the year ended July 31, 2020.
The Company estimated the fair value of its Colorado resort ground transportation company reporting unit based on an analysis of the present value of future cash flows (an income approach). The significant estimates used in the discounted cash flow model included the Company’s weighted average cost of capital for the reporting unit, projected cash flows and the long-term rate of growth, all of which are significant unobservable (Level 3) inputs. The Company’s assumptions were based on the actual historical performance of the reporting unit, taking into account the weakening of operating results and the expected continuation of operating results for transportation services. As a result of this impairment, the Company’s Colorado ground transportation company had no remaining goodwill recorded as of July 31, 2020.
The composition of accounts payable and accrued liabilities follows (in thousands):
 July 31,
  
20212020
Trade payables$98,261 $59,692 
Deferred revenue456,457 256,402 
Accrued salaries, wages and deferred compensation54,286 25,588 
Accrued benefits47,368 43,704 
Deposits35,263 20,070 
Operating lease liabilities34,668 36,604 
Other accruals89,169 57,048 
Total accounts payable and accrued liabilities$815,472 $499,108 
 July 31,
  
20182017
Trade payables$80,793
$71,558
Deferred revenue282,103
240,096
Accrued salaries, wages and deferred compensation40,034
44,869
Accrued benefits33,963
32,505
Deposits26,646
23,742
Other accruals40,994
54,899
Total accounts payable and accrued liabilities$504,533
$467,669
9.    Investments in Affiliates
The composition of other long-term liabilities follows (in thousands):

 July 31,
  
20182017
Private club deferred initiation fee revenue$114,319
$118,417
Unfavorable lease obligation, net21,839
24,664
Other long-term liabilities155,348
158,655
Total other long-term liabilities$291,506
$301,736

7.Investments in Affiliates
The Company held the following investments in equity method affiliates as of July 31, 2018:
2021:
Equity Method Affiliates
Ownership

Interest
Slifer, Smith, and Frampton/Vail Associates Real Estate, LLC (“SSF/VARE”)50%
KRED50%
Clinton Ditch and Reservoir Company43%
The Company had total net investments in equity method affiliates of $7.7$10.6 million and $7.6$10.2 million as of July 31, 20182021 and 2017,2020, respectively, classified as “deferredincluded within deferred charges and other assets”assets in the accompanying Consolidated Balance Sheets. The amount of retained earnings that represent undistributed earnings of 50-percent-or-less-owned50% or less owned entities accounted for by the equity method was $4.4$6.8 million and $4.3$6.5 million as of July 31, 20182021 and 2017,2020, respectively. During the years ended July 31, 2018, 20172021, 2020 and 2016,2019, distributions in the amounts of $1.5$6.4 million, $1.9$0.7 million and $1.3$1.0 million, respectively, were received from equity method affiliates.
SSF/VARE is a real estate brokerage with multiple locations in Eagle and Summit Counties, Colorado in which the Company has a 50% ownership interest. SSF/VARE leases space for real estate offices from the Company.
10.    Fair Value Measurements
The Company recognized approximately $0.4 million in revenue related to these leases for each of the years ended July 31, 2018, 2017 and 2016.

8.Fair Value Measurements
Theutilizes FASB issued fair value guidance that establishes how reporting entities should measure fair value for measurement and disclosure purposes. The guidance establishes a common definition of fair value applicable to all assets and liabilities measured at fair value and prioritizes the inputs into valuation techniques used to measure fair value. Accordingly, the Company uses valuation techniques which maximize the use of observable inputs and minimize the use of unobservable inputs when determining fair value. The three levels of the hierarchy are as follows:
Level 1: Inputs that reflect unadjusted quoted prices in active markets that are accessible to the Company for identical assets or liabilities;
Level 2: Inputs include quoted prices for similar assets and liabilities in active and inactive markets or that are observable for the asset or liability either directly or indirectly; and

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Level 3: Unobservable inputs which are supported by little or no market activity.
The table below summarizes the Company’s cash equivalents, other current assets, Interest Rate Swaps and Contingent Consideration and interest rate swap measured at their estimated fair valuevalues (all other assets and liabilities measured at fair value are immaterial) (in thousands):
Estimated Fair Value Measurement as of July 31, 2018 Estimated Fair Value Measurement as of July 31, 2021
DescriptionTotalLevel 1Level 2Level 3DescriptionTotalLevel 1Level 2Level 3
Assets: Assets:
Money Market$3,021
$3,021
$—
$—
Money Market$253,782 $253,782 $— $— 
Commercial Paper$2,401
$—
$2,401
$—
Commercial Paper$2,401 $— $2,401 $— 
Certificates of Deposit$11,249
$—
$11,249
$—
Certificates of Deposit$259,945 $— $259,945 $— 
Liabilities: Liabilities:
Interest Rate SwapsInterest Rate Swaps$12,942 $— $12,942 $— 
Contingent Consideration$21,900
$—
$—
$21,900
Contingent Consideration$29,600 $— $— $29,600 
 
Estimated Fair Value Measurement as of July 31, 2017 Estimated Fair Value Measurement as of July 31, 2020
DescriptionTotalLevel 1Level 2Level 3DescriptionTotalLevel 1Level 2Level 3
Assets: Assets:
Money Market$3,008
$3,008
$—
$—
Money Market$203,158 $203,158 $— $— 
Commercial Paper$2,401
$—
$2,401
$—
Commercial Paper$2,401 $— $2,401 $— 
Certificates of Deposit$2,405
$—
$2,405
$—
Certificates of Deposit$8,208 $— $8,208 $— 
Interest Rate Swap$236
$—
$236
$—
 
Liabilities: Liabilities:
Interest Rate SwapsInterest Rate Swaps$22,510 $— $22,510 $— 
Contingent Consideration$27,400
$—
$—
$27,400
Contingent Consideration$17,800 $— $— $17,800 
The Company’s cash equivalents, other current assets and Interest Rate SwapSwaps are measured utilizing quoted market prices or pricing models whereby all significant inputs are either observable or corroborated by observable market data. The Interest Rate Swap was an instrument assumed in the Whistler Blackcomb acquisition that was a C$125.0 million fixed swap on the floating interest rate on the Whistler Credit Agreement, and was originally set to expire in September 2020. However, the Company settledentered into the Interest Rate SwapSwaps to hedge the LIBOR-based variable interest rate component of $400.0 million in September 2017 and therefore no longer utilized anprincipal amount of its Vail Holdings Credit Agreement. Changes in the estimated fair value are recognized in change in estimated fair value of hedging instruments on the Company’s Consolidated Statements of Comprehensive Income. Such amounts are reclassified into interest expense, net from other comprehensive income during the period in which the hedged item affects earnings. During the year ended July 31, 2021 $5.4 million was reclassified into interest expense, net from other comprehensive income. The estimated fair value of the Interest Rate SwapSwaps are included within other long-term liabilities on the Company’s Consolidated Balance Sheets as of July 31, 2018. Interest Rate Swap settlements2021 and changes in estimated fair value were recognized in Interest expense, net on the Consolidated Statement of Operations.July 31, 2020.
The following changechanges in Contingent Consideration during the years ended July 31, 20182021 and 20172020 were as follows (in thousands):
Balance at July 31, 2016$11,100
Change in estimated fair value16,300
Balance at July 31, 201727,400
Payment(3,646)
Change in estimated fair value(1,854)
Balance at July 31, 2018$21,900

Contingent Consideration
Balance as of July 31, 2019$27,200 
Payment(6,436)
Change in estimated fair value(2,964)
Balance as of July 31,202017,800 
Payment(2,602)
Change in estimated fair value14,402 
Balance as of July 31, 2021$29,600 
The Lease for Park City as discussed in Note 4, Long-term Debt, provides for participating contingent payments (the “Contingent Consideration”) to the landlord of 42% of the amount by which EBITDA for the Park City resort operations, as calculated under the Lease, exceeds approximately $35 million, as established at the transaction date, with such threshold amount subsequently increased annually by an inflation linked index and a 10% adjustment for any capital improvements or investments made under the Lease by the Company. The
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estimated fair value of Contingent Consideration includes the future period resort operations of Park City in the calculation of EBITDA on which participating contingent payments are made, which is determined on the basis of estimated subsequent year performance, escalated by an assumed long-term growth factor.factor and discounted to net present value. The Company estimated the fair value of the Contingent Consideration payments using an option pricing valuation model. Key assumptions included a discount rate of 11.3%11.0%, volatility of 17.5%17.0% and future period Park City EBITDA, and capital expenditures, which are unobservable inputs and thus are considered Level 3 inputs. The Company prepared a sensitivity analysis to evaluate the effect that changes on certain key assumptions would have on the estimated fair value of the Contingent Consideration. A change in the discount rate of 100 basis

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points or a 5% change in estimated subsequent year performance would result in a change in the estimated fair value within the range of approximately $4.0$3.8 million to $5.3 million.
Contingent Consideration is classified as a liability in our Consolidated Balance Sheets and is remeasured to an estimated fair value at each reporting date until the contingency is resolved. During the year ended July 31, 2018,2021, the Company made a payment to the landlord for Contingent Consideration of approximately $3.6$2.6 million and recorded a decreasean increase in the estimated fair value of approximately $1.9$14.4 million primarily related to the Contingent Consideration paymentimproved performance compared to estimated results for Park City in the year ended July 31, 2018 and other key assumptions noted above,2021, resulting in an increase in the expected payment for the year, as well as accretion resulting from the passage of time, resulting in an estimated fair value of the Contingent Consideration of $21.9$29.6 million as of July 31, 2018,2021, which is reflected in accounts payable and accrued liabilities and other long-term liabilities in the Consolidated Balance Sheet.

11.    Income Taxes
9.Income Taxes

The Company is subject to taxation in U.S. federal, state, and local jurisdictions and various non-U.S. jurisdictions, including Australia and Canada. The Company’s effective tax rate is impacted by the tax laws, regulations, practices and interpretations in the jurisdictions in which it operates and may fluctuate significantly from period to period depending on, among other things, the geographic mix of the Company’s profits and losses, changes in tax laws and regulations or their application and interpretation, the outcome of tax audits and changes in valuation allowances associated with the Company’s deferred tax assets.
On December 22, 2017,March 27, 2020, in response to the COVID-19 pandemic, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax CutsCoronavirus Aid, Relief, and JobsEconomic Security Act (the “Tax“CARES Act”). The TaxCARES Act includes broad and complex changesvarious amendments to the U.S. tax code that impacted the Company’s accounting and reporting for income taxes during the yearyears ended July 31, 2018. These changes primarily consist2021 and 2020, and the Company expects these amendments will continue to impact its accounting and reporting for income taxes in the future. The primary provisions of the following:
A reduction in the U.S. federal corporate income tax rate from 35% to 21%, effective January 1, 2018, which resulted in a U.S. blended federal statutory income tax rate forCARES Act that the Company has been impacted by include:
•allowing a carryback of the entire amount of eligible Federal net operating losses (“NOLs”) generated in calendar years 2018, 2019 and 2020 for up to five years prior to when such losses were incurred, representing a change from previous rules under the Tax Cuts & Jobs Act of 2017 (the “TCJA”), in which NOLs could not be carried back to prior years and utilization was limited to 80% of taxable income in future years. Under the CARES Act, the Company was permitted to carry back its pre-existing NOLs to tax years prior to the enactment of the TCJA and obtain an incremental benefit of $3.8 million in the year ended July 31, 20182020 related to the differential in federal tax rates between years that NOLs were generated and years that the NOLs were carried back to;
•treatment of approximately 27% (Augustcertain qualified improvement property (“QIP”) as 15-year property and allowing such QIP placed in service after December 31, 2017 through December 2017 at 35%to be eligible for bonus depreciation; and January 2018 through July 2018 at 21%), and which will then be reduced to 21% for the year ending July 31, 2019 and thereafter, subject to future changes
•increases in the tax laws.allowable business interest deduction from 30% of adjusted taxable income to 50% of adjusted taxable income for calendar years 2020.
The remeasurement of U.S. net deferred tax liabilities as of the effective date utilizing the new U.S. federal corporate income tax rate of 21%.
A territorial tax regime resulting in a one-time transitional repatriation tax on unremitted foreign earnings (“Transition Tax”), which may be paid over an eight-year period.
The elimination of the domestic production activities deduction, as well as revised limitations on certain business expenses and executive compensation deductions under “Section 162(m)” of the Internal Revenue Code.
Provides for a tax on global intangible low-taxed income (“GILTI”), a base erosion anti-abuse tax (“BEAT”) and a deduction for foreign derived intangible income (“FDII”).

On December 22, 2017, the Securities and Exchange Commission (“SEC”) staff issued Staff Accounting Bulletin No. 118 (“SAB 118”) to provide guidance related to accounting for the income tax effects of the Tax Act. SAB 118 provides that companies (i) should record the effects of the changes from the Tax Act for which the accounting is complete (not provisional), (ii) should record provisional amounts for the effects of the changes from the Tax Act for which the accounting is not complete, and for which reasonable estimates can be determined, in the period they are identified, and (iii) should not record provisional amounts if reasonable estimates cannot be made for the effects of the changes from the Tax Act, and should continue to apply guidance based on the tax law in effect prior to the enactment on December 22, 2017. In addition, SAB 118 established a one-year measurement period (through December 22, 2018) where a provisional amount could be subject to adjustment, and requires certain qualitative and quantitative disclosures related to provisional amounts and accounting during the measurement period.

The Tax Act increased limitations on the deductibility of certain executive compensation, expands the definition of a “covered employee” under Section 162(m), and, among other modifications, repeals the exception for performance-based compensation and commissions from the $1.0 million deduction limitation. The TaxCARES Act also provides transitional guidance, which will allow certain payments made under writtenrefundable employee retention credits and binding agreements that were entered into priordefers the requirement to November 2, 2017 to be treated as if they were made underremit the provisionsemployer-paid portion of Section 162(m) that were in effect prior to enactment of the Tax Act. The Company is in the process of reviewing existing compensation arrangements for covered employees as well as assessing the impact of transitional guidance on the realizability of existing deferred tax assets related to compensation arrangements of its covered employees.social security payroll taxes. As a result, the Company did not made any adjustments related to the impact of the new executive compensation limitations in its consolidated financial statements forduring the year ended July 31, 2018. 2020, the Company recorded a benefit of approximately $9.6 million, which primarily offset Mountain and Lodging operating expense as a result of wages paid to employees who were not providing services. Additionally, the Company deferred payment of the employer-paid portion of social security payroll taxes through the end of calendar year 2020 and will remit such amounts in equal installments during calendar years 2021 and 2022.

AsThe Company also recognized benefits of approximately $30.8 million and $8.5 million during the years ended July 31, 2021 and 2020, respectively, as a result of the Tax Act, the Company recorded a one-time, provisional net tax benefit of approximately $61.0 million onrecent Canada Emergency Wage Subsidy and Australian JobKeeper legislation for its Consolidated Statement of Operations for the year ended July 31, 2018, as described below. The Company continues to evaluate the impact of these provisions; however, during this provisional period, it has determined there should be no GILTI inclusion, BEAT would not applyCanadian and there is an immaterial FDII deduction. The Company has not made a policy decision regarding whether to record deferred taxes on GILTI or use the period cost method.Australian employees, which primarily offset Mountain and Lodging operating expense.

Due to the reduction in the U.S. corporate tax rate, the Company remeasured its U.S. net deferred tax liabilities as of the effective date and recognized an estimated provisional benefit of approximately $67.0 million, as a discrete item in the benefit from income taxes for the year ended July 31, 2018, which is a reduction in net deferred tax liabilities in the accompanying Consolidated Balance


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Sheet as of July 31, 2018. The Company also recorded an estimated provisional charge for the Transition Tax of approximately $6.0 million as a discrete item in the benefit from income taxes for the year ended July 31, 2018.

The changes included in the Tax Act are broad and complex. The final transitional impacts of the Tax Act may materially differ from the above amounts due to, among other things, changes in interpretations of the Tax Act, any legislative action to address questions that arise with respect to the Tax Act or any updates the Company has utilized to calculate the transitional impacts. The Company will complete its analysis no later than December 22, 2018 (the end of the one-year measurement period).

The Tax Act does not provide for additional income taxes for any remaining undistributed foreign earnings not subject to the Transition Tax, or for any additional outside basis differences inherent in foreign entities, as these amounts continue to be indefinitely reinvested in those foreign operations. Substantially all of the Company’s unremitted foreign earnings that have not been previously taxed have now been subjected to U.S. taxation under the Transition Tax. The Company has made no additional provision for U.S. income taxes or additional non-U.S. taxes on the remaining unremitted accumulated earnings of non-U.S. subsidiaries. It is not practical at this time to determine the income tax liability related to any remaining undistributed earnings or additional basis difference not subject to the Transition Tax.

U.S. and foreign components of income (loss) before benefit (provision)provision for income taxes is as follows (in thousands):
Year Ended July 31,
202120202019
U.S.$148,898 $89,838 $306,323 
Foreign(23,715)26,595 92,642 
Income before income taxes$125,183 $116,433 $398,965 
 Year Ended July 31,
 201820172016
U.S.$264,379
$251,478
$231,756
Foreign75,713
96,971
10,863
Income before income taxes$340,092
$348,449
$242,619


Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and income tax purposes. Significant components of the Company’s deferred tax liabilities and assets are as follows (in thousands):
 July 31,
  
20212020
Deferred income tax liabilities:
Fixed assets$204,714 $216,016 
Intangible assets100,751 86,509 
Operating lease right of use assets47,915 53,727 
Convertible debt23,783 — 
Other15,116 13,709 
Total392,279 369,961 
Deferred income tax assets:
Canyons obligation16,080 14,997 
Stock-based compensation10,335 10,313 
Investment in Partnerships7,585 12,400 
Deferred compensation and other accrued benefits13,887 9,918 
Contingent Consideration7,430 4,468 
Net operating loss carryforwards and other tax credits12,182 13,205 
Operating lease liabilities53,755 60,838 
Other, net27,206 21,712 
Total148,460 147,851 
Valuation allowance for deferred income taxes(5,939)(5,330)
Deferred income tax assets, net of valuation allowance142,521 142,521 
Net deferred income tax liability$249,758 $227,440 
 July 31,
  
20182017
Deferred income tax liabilities:  
Fixed assets$126,697
$180,480
Intangible assets54,708
65,614
Other12,865
31,191
Total194,270
277,285
Deferred income tax assets:  
Canyons obligation13,145
19,276
Stock-based compensation9,824
17,862
Investment in Partnerships15,113
17,511
Deferred compensation and other accrued benefits9,220
15,215
Contingent Consideration5,476
10,472
Unfavorable lease obligation, net5,580
9,542
Net operating loss carryforwards and other tax credits5,716
12,783
Other, net11,501
19,468
Total75,575
122,129
Valuation allowance for deferred income taxes(5,450)(6,955)
Deferred income tax assets, net of valuation allowance70,125
115,174
Net deferred income tax liability$124,145
$162,111


The components of deferred income taxes recognized in the Consolidated Balance Sheets are as follows (in thousands):

July 31,
20212020
Deferred income tax asset$3,059 $6,751 
Deferred income tax liability252,817 234,191 
Net deferred income tax liability$249,758 $227,440 

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 July 31,
 20182017
Non-current deferred income tax asset$9,773
$9,331
Net non-current deferred income tax liability133,918
171,442
Net deferred income tax liability$124,145
$162,111

Significant components of the (benefit) provision for income taxes are as follows (in thousands):
 Year Ended July 31,
  
202120202019
Current:
Federal$20,387 $(13,467)$24,309 
State4,935 (731)8,539 
Foreign(8,460)4,141 20,205 
Total current16,862 (10,057)53,053 
Deferred:
Federal(16,289)12,597 16,983 
State(2,423)4,266 5,282 
Foreign2,576 572 154 
Total deferred(16,136)17,435 22,419 
Provision for income taxes$726 $7,378 $75,472 
 Year Ended July 31,
  
201820172016
Current:   
Federal$(43,366)$55,887
$70,553
State9,562
8,096
10,555
Foreign18,436
16,311
4,431
Total current(15,368)80,294
85,539
Deferred:   
Federal(45,922)29,065
7,603
State2,941
3,601
1,051
Foreign(2,789)3,771
(1,028)
Total deferred(45,770)36,437
7,626
(Benefit) provision for income taxes$(61,138)$116,731
$93,165


A reconciliation of the income tax (benefit) provision fromfor continuing operations and the amount computed by applying the United States federal statutory income tax rate to income before income taxes is as follows:
 Year Ended July 31,
  
202120202019
At U.S. federal income tax rate21.0 %21.0 %21.0 %
State income tax, net of federal benefit4.2 %3.5 %2.8 %
Change in uncertain tax positions(3.5)%(3.8)%(1.6)%
Excess tax benefits related to stock-based compensation(14.3)%(7.1)%(3.0)%
Impacts of the Tax Act and other legislative changes— %(3.2)%— %
Noncontrolling interests0.8 %(2.4)%(1.5)%
Foreign rate differential(5.0)%(2.4)%0.4 %
Taxes related to prior year filings(2.9)%— %— %
Other0.3 %0.7 %0.8 %
Effective tax rate0.6 %6.3 %18.9 %
 Year Ended July 31,
  
201820172016
At U.S. federal income tax rate26.8 %35.0 %35.0 %
State income tax, net of federal benefit3.0 %2.2 %3.1 %
Change in valuation allowance0.3 %0.9 %0.1 %
Excess tax benefits related to stock-based compensation(20.9)%— %— %
Impacts of the Tax Act(24.7)%— %— %
Noncontrolling interests(1.7)%(2.1)%— %
Foreign rate differential(1.5)%(3.4)%(0.2)%
Other0.7 %0.9 %0.4 %
Effective tax rate(18.0)%33.5 %38.4 %


A reconciliation of the beginning and ending amount of unrecognized tax benefits associated with uncertain tax positions, excluding associated deferred tax benefits and accrued interest and penalties, if applicable, is as follows (in thousands):
Year Ended July 31,
  
202120202019
Balance, beginning of year$70,299 $72,222 $78,242 
Additions for tax positions of prior years16,754 16,654 11,520 
Lapse of statute of limitations(19,196)(18,577)(17,540)
Balance, end of year$67,857 $70,299 $72,222 
 Year Ended July 31,
  
201820172016
Balance, beginning of year$76,111
$57,032
$38,572
Additions based on tax positions related to the current year—
—
—
Additions for tax positions of prior years12,394
19,079
18,460
Reductions for tax positions of prior years—
—
—
Lapse of statute of limitations(10,263)—
—
Settlements—
—
—
Balance, end of year$78,242
$76,111
$57,032


86






As of July 31, 2018,2021, the Company’s unrecognized tax benefits associated with uncertain tax positions relate to the treatment of the Talisker lease payments as payments of debt obligations and that the tax basis in Canyons goodwill is deductible, and are included within “other long-term liabilities” in the accompanying Consolidated Balance Sheets.


During the year ended July 31, 2018,2021, the Company experienced a reduction in the uncertain tax positions due to the lapse of the statute of limitations of $10.3$19.2 million, which was partially offset with an increase to the uncertain tax position of $12.4$16.8 million. Interest and penalties associated with the statute of limitations lapse were approximately $0.9$3.4 million. The Company is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next twelve months. Additionally, the Company expects a reduction to its uncertain tax positions for the fiscal year ending July 31, 2019,2022, due to the lapse of the statute of limitations. As of July 31, 20182021 and 2017,2020, accrued interest and penalties, net of tax, was $5.2$6.9 million and $3.6$6.2 million, respectively. For the years ended July 31, 2018, 20172021, 2020 and 2016,2019, the
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Company recognized as income tax expense $1.6(benefit) of $0.7 million, $2.0$(0.1) million and $1.1 million ofrelated to interest expense (benefit) and penalties, net of tax, respectively.


The Company’s major tax jurisdictions in which it files income tax returns isare the U.S. federal jurisdiction, various state jurisdictions, Australia, and Canada. The Company is no longer subject to U.S. federal examinations for tax years prior to 2014.2016. With few exceptions, the Company is no longer subject to examination by various U.S. state jurisdictions for tax years prior to 2012.2015. Additionally, the Company is no longer subject to audits for the tax years prior to 20132016 for Australia and Canada.


The Company has NOL carryforwards totaling $9.2$48.2 million, which are primarily comprised of $44.4 million of federal and state net operating loss (“NOL”) carryforwardsNOLs as a result of the acquisition of Peak Resorts in September 2019 that will expire by the year endingbeginning July 31, 2031.2031 and non-U.S. NOLs of $3.9 million that will carry forward indefinitely. In connection with Peak Resorts’ initial public offering in November 2014, as well as the Company’s acquisition of Peak Resorts in September 2019, Peak Resorts had two ownership changes pursuant to the provisions of the Tax Reform Act of 1986. As a result, the Company’s usage of its eligible Federal NOL carryforwards will be limited each year by these ownership changes; however, management believes the full benefit of those carryforwards will be realized prior to their respective expiration dates. As of July 31, 2018,2021, the Company has recorded a valuation allowance on $4.3$3.9 million of thesethe historical non-U.S. NOL carryforwards, as the Company has determined that it is more likely than not that thesethe associated NOL carryforwards will not be realized. Certain fully valued state NOLs have expired and were written off during the year ended July 31, 2018. Additionally, the Company has foreign tax credit carryforwards of $4.2 million, which expire by the year ending July 31, 2027.2028. As of July 31, 2018,2021, the Company has recorded a valuation allowance of $4.2 million on foreign tax credit carryforwards, as the Company has determined that it is more likely than not that these foreign tax credit carryforwards will not be realized. During the year ended July 31, 2021 the Company generated $2.7 million of capital losses; however the Company also recorded a valuation allowance of $2.7 million as the Company determined it is more likely than not that the capital loss will not be realized.


The Company may be required to record additional valuation allowances if, among other things, adverse economic conditions, including those caused by the COVID-19 pandemic, negatively impact the Company’s ability to realize its deferred tax assets. Evaluating and estimating the Company’s tax provision, current and deferred tax assets and liabilities and other tax accruals requires significant management judgment. The Company intends to indefinitely reinvest undistributed earnings, if any, in its Canadian foreign subsidiaries. It is not practical at this time to determine the income tax liability related to any remaining undistributed earnings.
10.
12.    Related Party Transactions
The Company has the right to appoint four4 of nine9 directors of the Beaver Creek Resort Company of Colorado (“BCRC”), a non-profit entity formed for the benefit of property owners and certain others in Beaver Creek. The Company has a management agreement with the BCRC, renewable for one-year periods, to provide management services on a fixed fee basis. Management fees and reimbursement of operating expenses paid to the Company under its agreement with the BCRC during the years ended July 31, 2018, 20172021, 2020 and 20162019 were $9.2$6.5 million, $8.9$8.3 million and $8.4$9.6 million, respectively.

13.    Commitments and Contingencies
11.Commitments and Contingencies
Metropolitan Districts
The Company credit-enhances $6.3 million of bonds issued by Holland Creek Metropolitan District (“HCMD”) through ana $6.4 million letter of credit issued under the Vail Holdings Credit Agreement. HCMD’s bonds were issued and used to build infrastructure associated with the Company’s Red Sky Ranch residential development. The Company has agreed to pay capital improvement fees to Red Sky Ranch Metropolitan District (“RSRMD”) until RSRMD’s revenue streams from property taxes are sufficient to meet debt service requirements under HCMD’s bonds. The Company recorded a liability of $2.0 million and $2.1 million, primarily within “otherother long-term liabilities”liabilities in the accompanying Consolidated Balance Sheets, as of both July 31, 20182021 and 20172020, respectively, with respect to the estimated present value of future RSRMD capital improvement fees. The Company estimates that it will make capital improvement fee payments under this arrangement through the year ending July 31, 2031.
Guarantees/Indemnifications
As of July 31, 2018,2021, the Company had various other letters of credit outstanding totaling $79.3$76.7 million, consisting of $53.4 million to support the Employee Housing Bonds $9.7and $23.3 million primarily for workers’ compensation, a wind energy purchase agreement and insurance-related deductibles, and $16.2 million for resort acquisition related activities.deductibles. The Company also had surety bonds of $9.4$13.2 million as of July 31, 2018,2021, primarily to provide collateral for its U.S. workers compensation self-insurance programs.

In addition to the guarantees noted above, the Company has entered into contracts in the normal course of business that include certain indemnifications under which it could be required to make payments to third parties upon the occurrence or non-occurrencenon-
104



occurrence of certain future events. These indemnities include indemnities related to licensees in connection with third-parties’ use of the Company’s trademarks and logos, liabilities associated with the infringement of other parties’ technology and software products, liabilities associated with the use of easements, liabilities associated with employment of contract workers and the Company’s

87





use of trustees, and liabilities associated with the Company’s use of public lands and environmental matters. The duration of these indemnities generally is indefinite and generally do not limit the future payments the Company could be obligated to make.

As permitted under applicable law, the Company and certain of its subsidiaries have agreed to indemnify their directors and officers over their lifetimes for certain events or occurrences while the officer or director is, or was, serving the Company or its subsidiaries in such a capacity. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company has a director and officer insurance policy that should enable the Company to recover a portion of any amounts paid.

Unless otherwise noted, the Company has not recorded any significant liabilities for the letters of credit, indemnities and other guarantees noted above in the accompanying Consolidated Financial Statements, either because the Company has recorded on its Consolidated Balance Sheets the underlying liability associated with the guarantee, the guarantee is with respect to the Company’s own performance and is therefore not subject to the measurement requirements as prescribed by GAAP, or because the Company has calculated the estimated fair value of the indemnification or guarantee to be immaterial based on the current facts and circumstances that would trigger a payment under the indemnification clause. In addition, with respect to certain indemnifications it is not possible to determine the maximum potential amount of liability under these potential obligations due to the unique set of facts and circumstances likely to be involved in each particular claim and indemnification provision. Historically, payments made by the Company under these obligations have not been material.

As noted above, the Company makes certain indemnifications to licensees for their use of the Company’s trademarks and logos. The Company does not record any liabilities with respect to these indemnifications.
Commitments
The operations of Northstar are conducted on land and with operating assets owned by affiliates of EPR Properties, a real-estate investment trust, primarily under operating leases which were assumed in the acquisition of Northstar by the Company. The leases provide for the payment of a minimum annual base rent over the lease term which is recognized on a straight-line basis over the remaining lease term from the date of assumption. In addition, the leases provide for the payment of percentage rent of certain gross revenues generated at the property over a revenue threshold which is incrementally adjusted annually. The initial term of the leases expires in fiscal 2027 and allows for three3 10-year extensions at the Company’s option. The operations of Perisher are conducted on land under a license and lease granted by the Office of Environment and Heritage, an agency of the New South Wales government, which initially commenced in 2008, and which the Company assumed in its acquisition of Perisher. The lease and license has a term that expires in fiscal 2048 and allows for an option to renew for an additional 20 years. The lease and license provide for the payment of an initial minimum annual base rent, with annual CPI increases, and percentage rent of AUS $1.8 million,certain gross revenue generated at the property. The operations of Falls Creek and Hotham are conducted on land under leases granted by the Governor of the State of Victoria, Australia and its dependencies, which initially commenced in 1991 and 1992, respectively, which the Company assumed in its acquisition of Falls Creek and Hotham in April 2019. The leases have terms that expire in fiscal 2041 for Falls Creek and fiscal 2058 for Hotham, and provide for the payment of rent with both a fixed and variable component. The operations of Mad River Mountain is conducted on land under a lease granted by EPT Mad River, Inc., which initially commenced in 2005, which the Company assumed in its acquisition of Peak Resorts in September 2019. The lease has a term that expires in the year ending July 31, 2035, and provides for the payment of an initial minimum annual base rent, with annual CPI increases, and percentage rent of certain gross revenue generated at the property. Additionally, the Company has entered into strategic long-term season pass alliance agreements with third-party mountain resorts in which the Company has committed to pay minimum revenue guarantees over the remaining terms of these agreements.
The Company has executed or assumed as lessee other operating leases for the rental of office and commercial space, employee residential units and land primarily through fiscal 2079. Certain of these leases have renewal terms at the Company’s option, escalation clauses, rent holidays and leasehold improvement incentives. Rent holidays and rent escalation clauses are recognized on a straight-line basis over the lease term. Leasehold improvement incentives are recorded as leasehold improvements and amortized over the shorter of their economic lives or the term of the lease. For the years ended July 31, 2018, 20172021, 2020 and 2016,2019, the Company recorded lease expense (including Northstar, Perisher, Falls Creek & Hotham and Perisher)Mad River Mountain), excluding executory costs, related to these agreements of $52.8$58.7 million, $51.9$58.8 million and $44.4$57.8 million, respectively, which is included in the accompanying Consolidated Statements of Operations.
As of July 31, 2018, See Note 4, Leases, for additional information regarding the Canyons obligation was $334.5 million, which represents the estimated annual lease payments for the remaining initial 50 year term of the lease assuming annual increases at the floor of 2% and discounted using an interest rate of 10%.

Company’s leasing arrangements.
88
105








Future minimum operating lease payments under the above leases and future minimum capital lease payments under the Canyons obligation as of July 31, 2018 reflected by fiscal year are as follows (in thousands):
 Operating Leases Capital Leases
2019$41,438
 $27,699
202038,831
 28,253
202135,950
 28,818
202232,444
 29,394
202328,840
 29,982
Thereafter155,410
 1,835,630
Total future minimum lease payments$332,913
 $1,979,776
Less amount representing interest  (1,645,267)
Net future minimum lease payments  $334,509
Self InsuranceSelf-Insurance
The Company is self-insured for claims under its U.S. health benefit plans and for the majority of workers’ compensation claims in the U.S. Workers compensation claims in the U.S. are subject to stop loss policies. The self-insurance liability related to workers’ compensation is determined actuarially based on claims filed. The self-insurance liability related to claims under the Company’s U.S. health benefit plans is determined based on analysis of actual claims. The amounts related to these claims are included as a component of accrued benefits in accounts payable and accrued liabilities (see Note 6,8, Supplementary Balance Sheet Information).
Legal

Employment-Related Litigation
From October 2020, several named plaintiffs filed respective complaints against the Company on behalf of the same or similar purported classes of current and former employees of the Company. The complaints generally allege violations of federal and state laws governing employee wage and hours practices, and seek damages in the form of unpaid wages, related penalties and other damages. The Company has proposed a settlement agreement to resolve these complaints, which is pending finalization and court approval. As a result, the Company recorded a charge of $13.2 million during the year ended July 31, 2021, which is included in general and administrative expense on the Company’s Consolidated Statement of Operations.
The Company is also a party to various lawsuits arising in the ordinary course of business. Management believes the Company has adequate insurance coverage and/or has accrued for all loss contingencies for asserted and unasserted matters deemed to be probable losses and reasonably estimable. As of July 31, 20182021 and 2017,2020, the accruals for the above loss contingencies (excluding the employment-related litigation) were not material individually or in the aggregate.

14.    Segment and Geographic Area Information
12.Segment and Geographic Area Information
Segment Information
The Company has three reportable segments: Mountain, Lodging and Real Estate. The Company refers to “Resort” as the combination of the Mountain and Lodging segments. The Mountain segment includes the operations of the Company’s mountain resorts/ski areas and related ancillary activities. The Lodging segment includes the operations of the Company’s owned hotels, RockResorts, NPS concessionaire properties, condominium management, Colorado resort ground transportation operations and mountain resort golf operations. The Real Estate segment owns, develops and sells real estate in and around the Company’s resort communities. The Company’s reportable segments, although integral to the success of the others, offer distinctly different products and services and require different types of management focus. As such, these segments are managed separately.
The Company reports its segment results using Reported EBITDA (defined as segment net revenue less segment operating expenses, plus or minus segment equity investment income or loss, and for the Real Estate segment, plus gain or loss on sale of real property). The Company reports segment results in a manner consistent with management’s internal reporting of operating results to the chief operating decision maker (Chief Executive Officer) for purposes of evaluating segment performance.
Items excluded from Reported EBITDA are significant components in understanding and assessing financial performance. Reported EBITDA should not be considered in isolation or as an alternative to, or substitute for, net income, net change in cash and cash equivalents or other financial statement data presented in the consolidated financial statementsConsolidated Financial Statements as indicators of financial performance or liquidity.
The Company utilizes Reported EBITDA in evaluating the performance of the Company and in allocating resources to its segments. Mountain Reported EBITDA consists of Mountain net revenue less Mountain operating expense plus or minus Mountain equity investment income or loss. Lodging Reported EBITDA consists of Lodging net revenue less Lodging operating expense. Real Estate Reported EBITDA consists of Real Estate net revenue less Real Estate operating expense plus gain or loss on sale of real property. All segment expenses include an allocation of corporate administrative expense. Assets are not allocated between

89





segments, or used to evaluate performance, except as shown in the table below. The accounting policies specific to each segment are the same as those described in Note 2, Summary of Significant Accounting Policies.
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Following is key financial information by reportable segment which is used by management in evaluating performance and allocating resources (in thousands):
 Year ended July 31,
  
202120202019
Net revenue:
Mountain$1,689,878 $1,710,443 $1,956,201 
Lodging218,062 248,414 314,662 
Total Resort net revenue1,907,940 1,958,857 2,270,863 
Real Estate1,770 4,847 712 
Total net revenue$1,909,710 $1,963,704 $2,271,575 
Segment operating expense:
Mountain$1,146,187 $1,212,053 $1,279,567 
Lodging223,795 245,145 286,562 
Total Resort operating expense1,369,982 1,457,198 1,566,129 
Real Estate6,676 9,182 5,609 
Total segment operating expense$1,376,658 $1,466,380 $1,571,738 
Gain on sale of real property$324 $207 $580 
Mountain equity investment income, net$6,698 $1,690 $1,960 
Reported EBITDA:
Mountain$550,389 $500,080 $678,594 
Lodging(5,733)3,269 28,100 
Resort544,656 503,349 706,694 
Real Estate(4,582)(4,128)(4,317)
Total Reported EBITDA$540,074 $499,221 $702,377 
Real estate held for sale or investment$95,615 $96,844 $101,021 
Reconciliation of net income attributable to Vail Resorts, Inc. to Total Reported EBITDA:   
Net income attributable to Vail Resorts, Inc.$127,850 $98,833 $301,163 
Net (loss) income attributable to noncontrolling interests(3,393)10,222 22,330 
Net income124,457 109,055 323,493 
Provision for income taxes726 7,378 75,472 
Income before provision for income taxes125,183 116,433 398,965 
Depreciation and amortization252,585 249,572 218,117 
Asset impairments— 28,372 — 
Loss (gain) on disposal of fixed assets and other, net5,373 (838)664 
Change in fair value of contingent consideration14,402 (2,964)5,367 
Investment income and other, net(586)(1,305)(3,086)
Foreign currency (gain) loss on intercompany loans(8,282)3,230 2,854 
Interest expense, net151,399 106,721 79,496 
Total Reported EBITDA$540,074 $499,221 $702,377 
 Year Ended July 31,
  
201820172016
Net revenue:   
Lift tickets$880,293
$818,341
$658,047
Ski school189,910
177,748
143,249
Dining161,402
150,587
121,008
Retail/rental296,466
293,428
241,134
Other194,851
171,682
141,166
Total Mountain net revenue1,722,922
1,611,786
1,304,604
Lodging284,643
278,514
274,554
Resort2,007,565
1,890,300
1,579,158
Real Estate3,988
16,918
22,128
Total net revenue$2,011,553
$1,907,218
$1,601,286
Segment operating expense:   
Mountain$1,132,840
$1,047,331
$881,472
Lodging259,637
251,427
246,385
Resort1,392,477
1,298,758
1,127,857
Real Estate, net3,546
24,083
24,639
Total segment operating expense$1,396,023
$1,322,841
$1,152,496
Gain on sale of real property$515
$6,766
$5,295
Mountain equity investment income, net$1,523
$1,883
$1,283
Reported EBITDA:   
Mountain$591,605
$566,338
$424,415
Lodging25,006
27,087
28,169
Resort616,611
593,425
452,584
Real Estate957
(399)2,784
Total Reported EBITDA$617,568
$593,026
$455,368
Real estate held for sale and investment$99,385
$103,405
$111,088
Reconciliation to net income attributable to Vail Resorts, Inc.:   
Total Reported EBITDA$617,568
$593,026
$455,368
Depreciation and amortization(204,462)(189,157)(161,488)
Change in fair value of contingent consideration1,854
(16,300)(4,200)
Loss on disposal of fixed assets and other, net(4,620)(6,430)(5,418)
Investment income and other, net1,944
6,114
723
Foreign currency (loss) gain on intercompany loans(8,966)15,285
—
Interest expense, net(63,226)(54,089)(42,366)
Income before benefit (provision) for income taxes340,092
348,449
242,619
Benefit (provision) for income taxes61,138
(116,731)(93,165)
Net income401,230
231,718
149,454
Net (income) loss attributable to noncontrolling interests(21,332)(21,165)300
Net income attributable to Vail Resorts, Inc.$379,898
$210,553
$149,754



90
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Geographic Information

Net revenue and property, plant and equipment, net by geographic region are as follows (in thousands).:
Year ended July 31,
Net revenue202120202019
U.S.$1,717,270 $1,655,961 $1,865,062 
International (1)
192,440 307,743 406,513 
Total net revenue$1,909,710 $1,963,704 $2,271,575 
July 31,
Property, plant and equipment, net20212020
U.S.$1,646,097 $1,759,692 
International (2)
421,779 432,987 
Total property, plant and equipment, net$2,067,876 $2,192,679 
 Year Ended July 31,
Net revenue201820172016
U.S.$1,610,323
$1,578,276
$1,534,716
International (a)401,230
328,942
66,570
Total net revenue$2,011,553
$1,907,218
$1,601,286
    
  As of July 31,
Property, plant and equipment, net 20182017
U.S. $1,210,169
$1,260,220
International (a) 417,050
453,933
Total property, plant and equipment, net $1,627,219
$1,714,154

(a) The only(1) No individual international country (i.e. except the U.S.) accounted for more than 10% of the Company’s revenue for the year ended July 31, 2021. The only individual international country to account for more than 10% of the Company’s revenue for the years ended July 31, 2020 and 2019 was Canada. Canada accounted for $223.3 million and $308.1 million of revenue for the years ended July 31, 2020 and 2019, respectively.
(2) The only individual international country to account for more than 10% of the Company’s property plant and equipment, net was Canada. Canada accounted for $321.0$288.4 million and $257.8 million of revenue for the years ended July 31, 2018 and 2017, respectively, and for $316.8 million and $338.8$291.7 million of property, plant and equipment, net as of July 31, 20182021 and 2017,2020, respectively.

13.15.    Selected Quarterly Financial Data (Unaudited)
  
Year ended July 31, 2021
(in thousands, except per share amounts)Full YearFourth
Quarter		Third
Quarter		Second
Quarter		First
Quarter
Total net revenue$1,909,710 $204,202 $889,078 $684,644 $131,786 
Income (loss) from operations$261,016 $(170,444)$387,705 $207,716 $(163,961)
Net income (loss)$124,457 $(144,942)$277,290 $149,130 $(157,021)
Net income (loss) attributable to Vail Resorts, Inc.$127,850 $(140,811)$274,629 $147,798 $(153,766)
Basic net income (loss) per share attributable to Vail Resorts, Inc.$3.17 $(3.49)$6.82 $3.67 $(3.82)
Diluted net income (loss) per share attributable to Vail Resorts, Inc.$3.13 $(3.49)$6.72 $3.62 $(3.82)
  
Year ended July 31, 2020
(in thousands, except per share amounts)Full YearFourth
Quarter		Third
Quarter		Second
Quarter		First
Quarter
Total net revenue$1,963,704 $77,209 $694,087 $924,638 $267,770 
Income (loss) from operations$223,389 $(170,046)$218,232 $310,733 $(135,530)
Net income (loss)$109,055 $(157,965)$159,831 $217,018 $(109,829)
Net income (loss) attributable to Vail Resorts, Inc.$98,833 $(153,608)$152,546 $206,370 $(106,475)
Basic net income (loss) per share attributable to Vail Resorts, Inc.$2.45 $(3.82)$3.79 $5.12 $(2.64)
Diluted net income (loss) per share attributable to Vail Resorts, Inc.$2.42 $(3.82)$3.74 $5.04 $(2.64)
108
  
Year Ended July 31, 2018
(in thousands, except per share amounts)Full Year
Fourth
Quarter
Third
Quarter
Second
Quarter
First
Quarter
Total net revenue$2,011,553
$211,637
$844,491
$734,575
$220,850
Income (loss) from operations$408,817
$(112,986)$367,978
$257,541
$(103,716)
Net income (loss)$401,230
$(87,791)$272,275
$248,673
$(31,927)
Net income (loss) attributable to Vail Resorts, Inc.$379,898
$(83,660)$256,252
$235,691
$(28,385)
Basic net income (loss) per share attributable to Vail Resorts, Inc.$9.40
$(2.07)$6.34
$5.82
$(0.71)
Diluted net income (loss) per share attributable to Vail Resorts, Inc.$9.13
$(2.07)$6.17
$5.67
$(0.71)




  
Year Ended July 31, 2017
(in thousands, except per share amounts)Full YearFourth
Quarter		Third
Quarter		Second
Quarter		First
Quarter
Total net revenue$1,907,218
$209,124
$794,631
$725,198
$178,265
Income (loss) from operations$379,256
$(102,577)$320,073
$252,278
$(90,518)
Net income (loss)$231,718
$(61,248)$196,856
$159,728
$(63,618)
Net income (loss) attributable to Vail Resorts, Inc.$210,553
$(57,146)$181,107
$149,179
$(62,587)
Basic net income (loss) per share attributable to Vail Resorts, Inc.$5.36
$(1.43)$4.52
$3.72
$(1.70)
Diluted net income (loss) per share attributable to Vail Resorts, Inc.$5.22
$(1.43)$4.40
$3.63
$(1.70)
16.    Share Repurchase Program


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14.Share Repurchase Program
On March 9, 2006, the Company’s Board of Directors approved a share repurchase program, authorizing the Company to repurchase up to 3,000,000 Vail Shares. On July 16, 2008, the Company’s Board of Directors increased the authorization by an additional 3,000,000 Vail Shares, and on December 4, 2015, the Company’s Board of Directors increased the authorization by an additional 1,500,000 Vail Shares for a total authorization to repurchase shares of up to 7,500,000 total shares.Vail Shares. The company did not repurchase any Vail Shares during the year ended July 31, 2021. During the year ended July 31, 2018,2020, the Company repurchased 115,422256,418 Vail Shares (at a total cost of $25.8$46.4 million). During the year ended July 31, 2017,2019, the Company repurchased 1,317353,007 Vail Shares (at a total cost of $0.2 million). During the year ended July 31, 2016, the Company repurchased 485,866 Vail Shares (at a total cost of $53.8$85.0 million). Since inception of this stock repurchase program through July 31, 2018,2021, the Company has repurchased 5,551,7166,161,141 shares at a cost of approximately $273.0$404.4 million. As of July 31, 2018, 1,948,2842021, 1,338,859 Vail Shares remained available to repurchase under the existing share repurchase program, which has no expiration date. Vail Shares purchased pursuant to the repurchase program will be held as treasury shares and may be used for issuance under the Company’s employee share award plan.

17.    Stock Compensation Plan
15.Stock Compensation Plan
The Company has a share award plan (the “Plan”) which has been approved by the Company’s stockholders. Under the Plan, up to 4.4 million shares of common stock could be issued in the form of options, stock appreciation rights, restricted shares, restricted share units, performance shares, performance share units, dividend equivalents or other share-based awards to employees, directors or consultants of the Company or its subsidiaries or affiliates. The terms of awards granted under the Plan, including exercise price, vesting period and life, are set by the Compensation Committee of the Board of Directors. All share-based awards (except for restricted shares and restricted share units) granted under the Plan have a life of ten years. Most awards vest ratably over three years; however, some have been granted with different vesting schedules. Of the awards outstanding, none have been granted to non-employees (except those granted to non-employee members of the Board of Directors of the Company) under the Plan. At July 31, 2018,2021, approximately 3.82.8 million share based awards were available to be granted under the Plan.
The fair value of stock-settled stock appreciation rights (“SARs”) granted in the years ended July 31, 2018, 20172021, 2020 and 20162019 were estimated on the date of grant using a lattice-based option valuation model that applies the assumptions noted in the table below. A lattice-based model considers factors such as exercise behavior, and assumes employees will exercise equity awards at different times over the contractual life of the equity awards. As a lattice-based model considers these factors, and is more flexible, the Company considers it to be a better method of valuing equity awards than a closed-form Black-Scholes model. Because lattice-based option valuation models incorporate ranges of assumptions for inputs, those ranges are disclosed. Expected volatility is based on historical volatility of the Company’s stock. The Company uses historical data to estimate equity award exercises and employee terminations within the valuation model; separate groups of employees that have similar historical exercise behavior are considered separately for valuation purposes. The expected term of equity awards granted is derived from the output of the option valuation model and represents the period of time that equity awards granted are expected to be outstanding; the range given below results from certain groups of employees exhibiting different behavior. The risk-free rate for periods within the contractual life of the equity award is based on the United States Treasury yield curve in effect at the time of grant.
Year Ended July 31, Year ended July 31,
201820172016
202120202019
Expected volatility40.0%40.3%40.4%Expected volatility30.7%29.7%38.6%
Expected dividends2.0%2.2%Expected dividends3.0%2.8%2.1%
Expected term (average in years)5.8-6.45.5-6.25.3-5.9Expected term (average in years)6.6-6.96.5-7.16.0-6.6
Risk-free rate1.2-2.3%0.5-1.5%0.3-2.2%Risk-free rate0.1-0.6%1.8-2.0%2.4-2.9%
The Company records actual forfeitures related to unvested awards upon employee terminations.

92109








A summary of aggregate SARs award activity under the Plan as of July 31, 2018, 20172021, 2020 and 2016,2019, and changes during the years then ended is presented below (in thousands, except exercise price and contractual term):
AwardsWeighted-Average
Exercise Price		Weighted-Average
Remaining
Contractual Term		Aggregate
Intrinsic
Value
Awards
Weighted-Average
Exercise Price
Weighted-Average
Remaining
Contractual Term
Aggregate
Intrinsic
Value
Outstanding at August 1, 20152,385
$47.96
  
Outstanding at August 1, 2018Outstanding at August 1, 20181,324 $91.01 
Granted198
$113.67
  Granted80 $293.82 
Exercised(180)$49.79
  Exercised(219)$49.09 
Forfeited or expired(22)$80.42
  Forfeited or expired(14)$217.58   
Outstanding at July 31, 20162,381
$52.98
  
Outstanding at July 31, 2019Outstanding at July 31, 20191,171 $111.12 
Granted143
$174.42
  Granted146 $245.26 
Exercised(215)$60.05
  Exercised(247)$67.19 
Forfeited or expired(19)$108.06
  Forfeited or expired(9)$252.75   
Outstanding at July 31, 20172,290
$59.12
  
Outstanding at July 31, 2020Outstanding at July 31, 20201,061 $138.59 
Granted86
$237.86
  Granted205 $233.01 
Exercised(1,049)$33.25
  Exercised(370)$84.20 
Forfeited or expired(3)$172.03
  Forfeited or expired(23)$236.31   
Outstanding at July 31, 20181,324
$91.01
5.3 years$246,198
Vested and expected to vest at July 31, 20181,309
$90.07
5.3 years$244,711
Exercisable at July 31, 20181,092
$71.54
4.7 years$224,231
Outstanding at July 31, 2021Outstanding at July 31, 2021873 $181.17 5.8 years$108,910 
Vested and expected to vest at July 31, 2021Vested and expected to vest at July 31, 2021852 $179.67 5.8 years$107,567 
Exercisable at July 31, 2021Exercisable at July 31, 2021571 $149.21 4.3 years$89,531 
The weighted-average grant-date estimated fair value of SARs granted during the years ended July 31, 2018, 20172021, 2020 and 20162019 was $78.07, $50.78$52.30, $58.25 and $35.20,$98.19, respectively. The total intrinsic value of SARs exercised during the years ended July 31, 2018, 20172021, 2020 and 20162019 was $213.8$82.0 million, $22.6$35.0 million and $13.1$41.2 million, respectively. The Company had 169,000, 247,00096,000, 91,000 and 302,000131,000 SARs that vested during the years ended July 31, 2018, 20172021, 2020 and 2016,2019, respectively. These awards had a total estimated fair value of $18.5$0.1 million, $19.6$2.6 million and $10.8$15.2 million at the date of vesting for the years ended July 31, 2018, 20172021, 2020 and 2016,2019, respectively.

A summary of the status of the Company’s nonvested SARs as of July 31, 20182021 and changes during the year then ended is presented below (in thousands, except fair value amounts):
AwardsWeighted-Average
Grant-Date
Fair Value
Awards
Weighted-Average
Grant-Date
Fair Value
Outstanding at July 31, 2017318$42.46
Nonvested at July 31, 2020Nonvested at July 31, 2020215$69.45 
Granted86$78.07
Granted205$52.30 
Vested(169)$38.59
Vested(96)$73.26 
Forfeited(3)$54.32
Forfeited(22)$62.93 
Nonvested at July 31, 2018232$56.72
Nonvested at July 31, 2021Nonvested at July 31, 2021302$57.22 
A summary of the status of the Company’s nonvested restricted share units as of July 31, 20182021 and changes during the year then ended is presented below (in thousands, except fair value amounts):
AwardsWeighted-Average
Grant-Date
Fair Value
Nonvested at July 31, 2020130$228.77 
Granted94$222.17 
Vested(66)$229.41 
Forfeited(15)$224.60 
Nonvested at July 31, 2021143$224.94 
 Awards
Weighted-Average
Grant-Date
Fair Value
Nonvested at July 31, 2017211$119.97
Granted77$215.14
Vested(101)$112.42
Forfeited(11)$159.78
Nonvested at July 31, 2018176$163.83


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The Company granted 77,00094,000 restricted share units during the year ended July 31, 20182021 with a weighted-average grant-date estimated fair value of $215.14.$222.17. The Company granted 91,00083,000 restricted share units during the year ended July 31, 20172020 with a weighted-average grant-date estimated fair value of $154.19.$217.46. The Company granted 142,00068,000 restricted share units during the year ended July 31, 20162019 with a weighted-average grant-date estimated fair value of $102.20.$264.44. The Company had 101,000, 121,000 66,000, 63,000
110



and 134,000102,000 restricted share units that vested during the years ended July 31, 2018, 20172021, 2020 and 2016,2019, respectively. These units had a total estimated fair value of $23.5$15.0 million, $19.3$14.8 million and $14.6$28.8 million at the date of vesting for the years ended July 31, 2018, 20172021, 2020 and 2016,2019, respectively.
As of July 31, 2018,2021, there was $23.0$28.2 million of total unrecognized compensation expense related to nonvested share-based compensation arrangements granted under the Plan, of which $14.0$17.1 million, $7.9$9.7 million and $1.1$1.4 million of expense is expected to be recognized in the years ending July 31, 2019, 20202022, 2023 and 2021,2024, respectively, assuming no future share-based awards are granted.granted in the future or forfeited. The tax benefit realized or expected to be realized from SARs exercised and restricted stock units vested was $79.7$24.0 million, $15.5$12.3 million and $10.3$16.3 million for the years ended July 31, 2018, 20172021, 2020 and 2016,2019, respectively.
The Company has a policy of using either authorized and unissued shares or treasury shares, including shares acquired by purchase in the open market, to satisfy equity award exercises.

18.    Retirement and Profit Sharing Plans
16.Retirement and Profit Sharing Plans
The Company maintains a defined contribution retirement plan (the “Retirement Plan”), qualified under Section 401(k) of the Internal Revenue Code, for its U.S. employees. Under this Retirement Plan, U.S. employees are eligible to make before-tax contributions on the first day of the calendar month following the later of: (i) their employment commencement date or (ii) the date they turn 21. Participants may contribute up to 100% of their qualifying annual compensation up to the annual maximum specified by the Internal Revenue Code. TheWhen the Company participates in 401(k) contribution matching, it matches an amount equal to 50% of each participant’s contribution up to 6% of a participant’s bi-weekly qualifying compensation starting the pay period containing the first day of the month after obtaining the later of: (i) 12 months of employment with at least 1,000 service hours from the commencement date or (ii) if 1,000 hours within the first 12 months was not completed, then after the employee completed a cumulative 1,500 service hours. In April 2020, the Company announced a temporary six month suspension of its 401(k) contribution matching as a result of the impacts of COVID-19 and resulting resort closures, which subsequently resumed in October 2020. The Company’s matching contribution is entirely discretionary and may be reduced or eliminated at any time.

Total Retirement Plan expense recognized by the Company for the years ended July 31, 2018, 20172021, 2020 and 20162019 was $6.9$6.5 million, $5.4$5.8 million and $5.3$7.9 million, respectively.


17.    Subsequent Events
Amendment and Restatement of the Vail Holdings Credit Facility
On August 15, 2018, VHI, a wholly-owned subsidiary of the Company, entered into an Amendment Agreement (the “Amendment Agreement”) to amend and restate in its entirety the Vail Holdings Credit Agreement, with VHI, as borrower, the Company and certain subsidiaries of the Company, as guarantors, Bank of America, N.A., as administrative agent (the “Agent”), and the other lenders party thereto. The Amended Vail Holdings Credit Agreement provides for (i) a revolving loan facility in an aggregate principal amount of $400.0 million and (ii) a term loan facility in an aggregate principal amount of up to $950.0 million, increased from the Vail Holdings Credit Agreement term loan facility of $684.4 million as of July 31, 2018. The Company borrowed $70.0 million on August 15, 2018, primarily to fund the Stevens Pass Acquisition (as defined below), and borrowed $195.6 million on September 27, 2018 to fund the Triple Peaks Acquisition (as defined below).

Pursuant to the terms of the Amended Vail Holdings Credit Agreement, VHI has the ability to increase availability (under the revolver or in the form of term loans) to an aggregate principal amount not to exceed the greater of (i) $1.2 billion and (ii) the product of 2.75 and the trailing twelve-month Adjusted EBITDA, as defined in the Amended Vail Holdings Credit Agreement. The material terms of the Amended Vail Holdings Credit Agreement are substantially similar to those of the Vail Holdings Credit Agreement. Key modifications to the Amended Vail Holdings Credit Agreement included, among other things, the extension of the maturity on the revolving credit facility to August 2023.

VHI’s obligations under the Amended Vail Holdings Credit Agreement are guaranteed by the Company and certain of its subsidiaries and are collateralized by a pledge of all the capital stock of VHI and substantially all of its subsidiaries (with certain additional exceptions for the pledge of the capital stock of foreign subsidiaries). The proceeds of the loans made under the Amended Vail Holdings Credit Agreement may be used, in addition to funding resort acquisitions, as discussed below, to fund the Company’s working capital needs, capital expenditures, acquisitions, investments and other general corporate purposes, including the issuance of letters of credit. Borrowings under the Amended Vail Holdings Credit Agreement bear interest annually at a rate of (i) LIBOR plus a margin or (ii) the Agent’s prime lending rate plus a margin. Interest rate margins may fluctuate based upon the ratio of the Company’s Net Funded Debt to Adjusted EBITDA on a trailing four-quarter basis.


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Acquisitions
Stevens Pass Resort
On August 15, 2018, the Company, through a wholly-owned subsidiary, acquired Stevens Pass in the State of Washington from Ski Resort Holdings, LLC for a total purchase price of $64.0 million, subject to certain adjustments. The Company borrowed $70.0 million on August 15, 2018 under its Amended Vail Holdings Credit Agreement term loan, as discussed above, and acquired all of the assets related to the mountain operations of the resort, including base area skier services (food and beverage, retail and rental, lift ticket offices and ski and snowboard school facilities). The initial accounting for Stevens Pass is incomplete as the Company is in the process of obtaining and reviewing additional information related to the acquisition, including an analysis of the estimated fair value of assets acquired and liabilities assumed.

Okemo Mountain Resort, Crested Butte Mountain Resort, Mount Sunapee Resort
On September 27, 2018, the Company, through a wholly-owned subsidiary, acquired Triple Peaks, LLC (“Triple Peaks”), the parent company of Okemo Mountain Resort in Vermont, Crested Butte Mountain Resort in Colorado, and Mount Sunapee Resort in New Hampshire, for a cash purchase price of approximately $74.0 million, after adjustments for certain agreed-upon terms (the “Triple Peaks Acquisition”). In addition, at closing, Triple Peaks paid $155.0 million to pay off the leases that all three resorts had with Ski Resort Holdings, LLC, an affiliate of Oz Real Estate, with funds provided by the Company. The Company acquired all of the assets related to the mountain operations of the resorts, including base area skier services (food and beverage, retail and rental, lift ticket offices and ski and snowboard school facilities). The Company borrowed the remaining capacity of its term load under the Amended Vail Holdings Credit Agreement, as discussed above, to fund the acquisition. The Company obtained a new Special Use Permit from the U.S. Forest Service for Crested Butte, and assumed the state land leases for Okemo and Mount Sunapee.


ITEM 9.CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
ITEM 9.CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
None.


ITEM 9A.CONTROLS AND PROCEDURES.
ITEM 9A.CONTROLS AND PROCEDURES.
Disclosure Controls and Procedures
Management of the Company, including the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), have evaluated the effectiveness of the Company’s disclosure controls and procedures as of the end of the period covered by this Form 10-K. The term “disclosure controls and procedures” means controls and other procedures established by the Company that are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure.
Based upon their evaluation of the Company’s disclosure controls and procedures, the CEO and the CFO concluded that, as of the end of the period covered by this Form 10-K, the disclosure controls are effective to provide reasonable assurance that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to management, including the CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure and are effective to provide reasonable assurance that such information is recorded, processed, summarized and reported within the time periods specified by the SEC’s rules and forms.
111



The Company, including its CEO and CFO, does not expect that the Company’s controls and procedures will prevent or detect all error and all fraud. A control system, no matter how well conceived or operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.
Management’s Annual Report on Internal Control Over Financial Reporting
The report of management required underby this Item 9Aitem is contained in Item 88. of this Form 10-K under the caption “Management’s Report on Internal Control over Financial Reporting.”

95





Attestation Report of the Independent Registered Public Accounting Firm
The attestation report required underby this Item 9Aitem is contained in Item 88. of this Form 10-K under the caption “Report of Independent Registered Public Accounting Firm.”
Changes in Internal Control Over Financial Reporting
There were no changes in the Company’s internal control over financial reporting during the quarter ended July 31, 20182021 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.


ITEM 9B.OTHER INFORMATION.
ITEM 9B.OTHER INFORMATION.
None.

PART III

We expect to file with the SEC in October 20182021 (and, in any event, not later than 120 days after the close of our last fiscal year), a definitive Proxy Statement, pursuant to SEC Regulation 14A in connection with our Annual Meeting of Shareholders to be held in December 2018.2021.


ITEM 10.DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
ITEM 10.DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
The information required by this item is incorporated herein by reference from the Company’s definitive Proxy Statement for the 20182021 annual meeting of stockholders under the sections entitled “Information with Respect to Nominees,” “Management” and “Corporate Governance.”


ITEM 11.EXECUTIVE COMPENSATION.
ITEM 11.EXECUTIVE COMPENSATION.
The information required by this item is incorporated herein by reference from the Company’s definitive Proxy Statement for the 20182021 annual meeting of stockholders under the section entitled “Executive Compensation.”


ITEM 12.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
ITEM 12.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
The information required by this item is incorporated herein by reference from the Company’s definitive Proxy Statement for the 20182021 annual meeting of stockholders under the sections entitled “Security Ownership of Directors and Executive Officers” andOfficers,” “Information as to Certain Stockholders.Stockholders” and “Executive Compensation - Securities Authorized for Issuance under Equity Compensation Plans.”


ITEM 13.CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.
ITEM 13.CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.
The information required by this item is incorporated herein by reference from the Company’s definitive Proxy Statement for the 20182021 annual meeting of stockholders under the sections entitled “Determinations Regarding Independence” and “Transactions with Related Persons.”

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ITEM 14.PRINCIPAL ACCOUNTING FEES AND SERVICES.
ITEM 14.PRINCIPAL ACCOUNTING FEES AND SERVICES.
The information required by this item is incorporated herein by reference from the Company’s definitive Proxy Statement for the 20182021 annual meeting of stockholders under the section entitled “Proposal 2. Ratification of the Selection of Independent Registered Public Accounting Firm.”

PART IV


ITEM 15.EXHIBITS, FINANCIAL STATEMENT SCHEDULES.
ITEM 15.EXHIBITS, FINANCIAL STATEMENT SCHEDULES.
 
a)Index to Financial Statements.

(1)See “Item 8. Financial Statements and Supplementary Data” for the index to the Financial Statements.
(2)Schedules have been omitted because they are not required or not applicable, or the required information is shown in the financial statements or notes to the financial statements.
(3)See the Index to Exhibits below.

a)Index to Financial Statements.
96(1)See Item 8. “Financial Statements and Supplementary Data” for the index to the Financial Statements.


(2)Schedules have been omitted because they are not required or not applicable, or the required information is shown in the financial statements or notes to the financial statements.



(3)See the Index to Exhibits below.
The following exhibits are either filed or furnished herewith (as applicable) or, if so indicated, incorporated by reference to the documents indicated in parentheses, which have previously been filed or furnished (as applicable) with the Securities and Exchange Commission.
Posted

Exhibit

Number
Description
2.1
Transaction Agreement, dated as of May 24, 2013, between VR CPC Holdings, Inc. and ASC Utah LLC, Talisker Land Holdings, LLC, Talisker Canyons Lands LLC, Talisker Canyons Leaseco LLC, American Skiing Company Resort Properties LLC, Talisker Canyons Propco LLC and Talisker Canyons Finance Co LLC. (Incorporated by reference to Exhibit 2.1 on Form 8-K of Vail Resorts, Inc. filed on May 30, 2013) (File No. 001-09614).
2.2
Purchase and Sale Agreement, dated as of September 11, 2014, between VR CPC Holdings, Inc. and Greater Park City Company, Powdr Corp., Greater Properties, Inc., Park Properties, Inc. and Powdr Development Company. (Incorporated by reference to Exhibit 2.1 on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 31, 2014) (File No. 001-09614).
2.3
Arrangement Agreement, dated as of August 5, 2016, between Vail Resorts, Inc., 1068877 B.C. Ltd. and Whistler Blackcomb Holdings Inc. (Incorporated by reference to Exhibit 2.1 on Form 8-K of Vail Resorts, Inc. filed on August 8, 2016) (File No. 001-09614).
3.12.4
Agreement and Plan of Merger, dated as of July 20, 2019, by and among Vail Holdings, Inc., VRAD Holdings, Inc. and Peak Resorts, Inc., and solely with respect to Section 9.14, Vail Resorts, Inc. (Incorporated by reference to Exhibit 2.1 on Form 8-K of Vail Resorts, Inc. filed on July 22, 2019) (File No. 001-09614).
3.1
Amended and Restated Certificate of Incorporation of Vail Resorts, Inc., dated January 5, 2005. (Incorporated by reference to Exhibit 3.1 on Form 10-Q of Vail Resorts, Inc. for the quarter ended January 31, 2005)(File No. 001-09614).
3.2
Certificate of Amendment of Amended and Restated Certificate of Incorporation of Vail Resorts, Inc., dated December 7, 2011. (Incorporated by reference to Exhibit 3.1 on Form 8-K of Vail Resorts, Inc. filed on December 8, 2011) (File No. 001-09614).
3.3
Certificate of Designations of Special Voting Preferred Stock of Vail Resorts, Inc., dated October 17, 2016. (Incorporated by reference to Exhibit 3.1 on Form 8-K of Vail Resorts, Inc. filed on October 17, 2016) (File No. 001-09614).

3.4
Amended and Restated Bylaws of Vail Resorts, Inc., dated December 7, 2011. (Incorporated by reference to Exhibit 3.2 on Form 8-K of Vail Resorts, Inc. filed on December 8, 2011) (File No. 001-09614).
10.14.1
Indenture, dated May 4, 2020, by and among Vail Resorts, Inc., the Guarantors named therein and U.S. Bank National Association, as Trustee (Incorporated by reference to Exhibit 4.1 of Form 8-K of Vail Resorts, Inc. filed on May 4, 2020) (File No. 001-09614).
4.2
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Posted
Exhibit
Number		Description
4.3
10.1
Forest Service Unified Permit for Heavenly ski area, dated April 29, 2002 (File No. 001-09614).
10.2(a)
Forest Service Unified Permit for Keystone ski area, dated December 30, 1996. (Incorporated by reference to Exhibit 99.2(a) on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 31, 2002) (File No. 001-09614).
10.2(b)
Amendment No. 2 to Forest Service Unified Permit for Keystone ski area. (Incorporated by reference to Exhibit 99.2(b) on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 31, 2002) (File No. 001-09614).
10.2(c)
Amendment No. 3 to Forest Service Unified Permit for Keystone ski area. (Incorporated by reference to Exhibit 10.3 (c) on Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2005) (File No. 001-09614).
10.2(d)
Amendment No. 4 to Forest Service Unified Permit for Keystone ski area. (Incorporated by reference to Exhibit 10.3 (d) on Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2005) (File No. 001-09614).
10.2(e)
Amendment No. 5 to Forest Service Unified Permit for Keystone ski area. (Incorporated by reference to Exhibit 10.3 (e) on Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2005) (File No. 001-09614).
10.3(a)
Forest Service Unified Permit for Breckenridge ski area, dated December 31, 1996. (Incorporated by reference to Exhibit 99.3(a) on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 31, 2002) (File No. 001-09614).
10.3(b)
Amendment No. 1 to Forest Service Unified Permit for Breckenridge ski area. (Incorporated by reference to Exhibit 99.3(b) on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 31, 2002) (File No. 001-09614).
10.3(c)
Amendment No. 2 to Forest Service Unified Permit for Breckenridge ski area. (Incorporated by reference to Exhibit 10.4 (c) on Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2005) (File No. 001-09614).
10.3(d)
Amendment No. 3 to Forest Service Unified Permit for Breckenridge ski area. (Incorporated by reference to Exhibit 10.4 (d) on Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2005) (File No. 001-09614).
10.3(e)
Amendment No. 4 to Forest Service Unified Permit for Breckenridge ski area. (Incorporated by reference to Exhibit 10.4 (e) on Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2005) (File No. 001-09614).
10.3(f)
Amendment No. 5 to Forest Service Unified Permit for Breckenridge ski area. (Incorporated by reference to Exhibit 10.4(f) on Form 10-Q of Vail Resorts, Inc. for the quarter ended January 31, 2006) (File No. 001-09614).
10.4(a)
Forest Service Unified Permit for Beaver Creek ski area. (Incorporated by reference to Exhibit 99.4(a) on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 31, 2002) (File No. 001-09614).
10.4(b)
Exhibits to Forest Service Unified Permit for Beaver Creek ski area. (Incorporated by reference to Exhibit 99.4(b) on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 31, 2002) (File No. 001-09614).
10.4(c)
Amendment No. 1 to Forest Service Unified Permit for Beaver Creek ski area. (Incorporated by reference to Exhibit 10.5(c) on Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2005) (File No. 001-09614).

97





Posted
Exhibit
Number
10.4(d)		Description
10.4(d)
Amendment No. 2 to Forest Service Unified Permit for Beaver Creek ski area. (Incorporated by reference to Exhibit 10.5(d) on Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2005) (File No. 001-09614).
10.4(e)
Amendment to Forest Service Unified Permit for Beaver Creek ski area. (Incorporated by reference to Exhibit 10.5(e) on Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2005) (File No. 001-09614).
10.4(f)
Amendment No. 3 to Forest Service Unified Permit for Beaver Creek ski area. (Incorporated by reference to Exhibit 10.4(f) on Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2008) (File No. 001-09614).
10.5(a)
Forest Service Unified Permit for Vail ski area, dated November 23, 1993. (Incorporated by reference to Exhibit 99.5(a) on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 31, 2002) (File No. 001-09614).
10.5(b)
Exhibits to Forest Service Unified Permit for Vail ski area. (Incorporated by reference to Exhibit 99.5(b) on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 31, 2002) (File No. 001-09614).
10.5(c)
Amendment No. 2 to Forest Service Unified Permit for Vail ski area. (Incorporated by reference to Exhibit 99.5(c) on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 31, 2002) (File No. 001-09614).
10.5(d)
Amendment No. 3 to Forest Service Unified Permit for Vail ski area. (Incorporated by reference to Exhibit 10.6 (d) on Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2005) (File No. 001-09614).
10.5(e)
Amendment No. 4 to Forest Service Unified Permit for Vail ski area. (Incorporated by reference to Exhibit 10.6 (e) on Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2005) (File No. 001-09614).
10.6*
Vail Resorts, Inc. Amended and Restated 2002 Long Term Incentive and Share Award Plan. (Incorporated by reference to Exhibit 99.1 on Form 8-K of Vail Resorts, Inc. filed on December 10, 2009) (File No. 001-09614).
10.7*
Form of Stock Option Agreement. (Incorporated by reference to Exhibit 10.20 of Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2007) (File No. 001-09614).
10.8*
Form of Restricted Share Unit Agreement. (Incorporated by reference to Exhibit 10.2 on Form 8-K of Vail Resorts, Inc. filed on December 7, 2015) (File Number 001-09614).
10.9*10.8*
Form of Share Appreciation Rights Agreement. (Incorporated by reference to Exhibit 10.3 on Form 8-K of Vail Resorts, Inc. filed on December 7, 2015) (File Number 001-09614)
10.10*10.9*
Vail Resorts Deferred Compensation Plan, effective as of January 1, 2005. (Incorporated by reference to Exhibit 10.22 on Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2009) (File No. 001-09614).
114



10.11(a)*Posted
Exhibit
Number		Description
10.10(a)*
Executive Employment Agreement made and entered into October 15, 2008 by and between Vail Resorts, Inc. and Robert A. Katz. (Incorporated by reference to Exhibit 10.1 of the report on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 31, 2008) (File No. 001-09614).
10.11(b)10.10(b)*
First Amendment to Executive Employment Agreement, dated September 30, 2011, by and between Vail Resorts, Inc. and Robert A. Katz (Incorporated by reference to Exhibit 10.1 on Form 8-K of Vail Resorts, Inc. filed September 30, 2011) (File No. 001-09614).
10.11(c)10.10(c)*
Second Amendment to Executive Employment Agreement, dated April 11, 2013, by and between Vail Resorts, Inc. and Robert A. Katz. (Incorporated by reference to Exhibit 10.1 on Form 10-Q of Vail Resorts, Inc. for the quarter ended April 30, 2013) (File No. 001-09614).

10.12*10.11*
Form of Indemnification Agreement. (Incorporated by reference to Exhibit 10.8 of the report on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 31, 2008) (File No. 001-09614).
10.1310.12
Master Agreement of Lease, dated May 29, 2013, between VR CPC Holdings, Inc. and Talisker Canyons Leaseco LLC. (Incorporated by reference to Exhibit 10.1 on Form 8-K of Vail Resorts, Inc. filed on May 30, 2013) (File No. 001-09614).
10.1410.13
Guaranty of Vail Resorts, Inc., dated May 29, 2013, in connection with the Master Agreement of Lease between VR CPC Holdings, Inc. and Talisker Canyons Leaseco LLC. (Incorporated by reference to Exhibit 10.2 on Form 8-K of Vail Resorts, Inc. filed on May 30, 2013) (File No. 001-09614).

10.15*10.14*
Vail Resorts, Inc. Management Incentive Plan.Plan (Incorporated by reference to Exhibit 10.1 on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 31, 2016)2020) (File No. 001-09614).
10.16*10.15*
Vail Resorts, Inc. 2015 Omnibus Incentive Plan (Incorporated by reference to Exhibit 10.1 on Form 8-K of Vail Resorts, Inc. filed on December 7, 2015) (File Number 001-09614).
10.17(a)10.16*
SeventhForm of Restricted Share Unit Agreement (effective September 23, 2020) (Incorporated by reference to Exhibit 10.17 on Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2020) (File Number 001-09614).
10.17*
Form of Share Appreciation Rights Agreement (effective September 23, 2020) (Incorporated by reference to Exhibit 10.18 on Form 10-K of Vail Resorts, Inc. for the year ended July 31, 2020) (File Number 001-09614).
10.18(a)
Eighth Amended and Restated Credit Agreement, Annex A to that certain Amendment Agreement, dated as of May 1, 2015,August 15, 2018, among Vail Holdings, Inc., as borrower, Bank of America, N.A., as administrative agent, U.S. Bank National Association and Wells Fargo, Bank, National Association, as co-syndication agents, BBVA Compass,Agents, and the Lenders party thereto (Incorporated by reference to Exhibit 10.1 on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 31, 2018) (File No. 001-09614).
10.18(b)
First Amendment to the Eighth Amended and Restated Credit Agreement, dated as documentationof April 15, 2019, among Vail Holdings, Inc., as borrower, and Bank of America, N.A., as administrative agent, on its own behalf and on behalf of the Lenders party thereto (Incorporated by reference to Exhibit 10.1 on Form 10-Q of Vail Resorts, Inc. for the quarter ended April 30, 2019) (File No. 001-09614).
10.18(c)
Second Amendment to the Eighth Amended and Restated Credit Agreement, dated as of September 23, 2019, among Vail Holdings, Inc., as borrower, and Bank of America, N.A., as administrative agent, on its own behalf and on behalf of the Lenders party thereto. (Incorporated by reference to Exhibit 10.1 on Form 10-Q of Vail Resorts, Inc. for the quarter ended April 30, 2015)October 31, 2019) (File No. 001-09614).
10.17(b)
First Amendment to Seventh Amended and Restated Credit Agreement dated as of December 4, 2015, among Vail Holdings, Inc., as borrower, Bank of America N.A., as administrative agent, and the Lenders party thereto (Incorporated by reference to Exhibit 10.2 on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 31, 2015) (File Number 001-09614).

98





Posted
Exhibit
Number
10.18(d)		Description
10.17(c)
Second Amendment to Seventh Amended and Restated Credit Agreement, dated October 14, 2016 (Incorporated by reference to Exhibit 10.1 on Form 8-K of Vail Resorts, Inc. filed on October 17, 2016) (File No. 001-09614).
10.17(d)
Third Amendment to Sevenththe Eighth Amended and Restated Credit Agreement, dated as of April 7, 2017, by and28, 2020, among Vail Holdings, Inc., as borrower, and Bank of America, N.A., as Administrative Agent,administrative agent, on its own behalf and on behalf of the Lenders named therein (Incorporated by reference to Exhibit 10.3 on Form 10-Q of Vail Resorts, Inc. for the quarter ended April 30, 2017) (File Number 001-09614).
10.17(e)
Fourth Amendment to Seventh Amended and Restated Credit Agreement, dated as of April 13, 2018, by and among Vail Holdings, Inc., Bank of America, N.A., as Administrative Agent, and the Lenders named thereinparty thereto (Incorporated by reference to Exhibit 10.1 on Form 10-Q of Vail Resorts, Inc. for the quarter ended April 30, 2018)2020) (File NumberNo. 001-09614).
10.18(a)10.18(e)
Fourth Amendment to the Eighth Amended and Restated Credit Agreement, dated as of December 18, 2020, between Vail Holdings, Inc., as borrower, Vail Resorts, Inc. and certain subsidiaries of Vail Resorts, Inc., as guarantors, and Bank of America, N.A., as administrative agent, on its own behalf and on the behalf of the Lenders party thereto. (Incorporated by reference to Exhibit 10.1 on Form 8-K of Vail Resorts, Inc. filed on December 18, 2020) (File No. 001-09614).
10.19(a)
Amended and Restated Credit Agreement and the amendments thereto, dated as of November 12, 2013, among Whistler Mountain Resort Limited Partnership and Blackcomb Skiing Enterprises Limited Partnership, as borrowers, the Guarantors Party thereto, the Financial Institutions named therein, The Toronto-Dominion Bank, as administrative agent, TD Securities, as lead arranger and sole bookrunner, and Royal Bank of Canada, Bank of Montreal, Wells Fargo Bank, N.A., Canadian Branch, and Bank of America, N.A., Canadian Branch, as co-documentation agents (Incorporated by reference to Exhibit 10.3 on Form 10-Q of Vail Resorts, Inc. for the quarter ended October 30, 2016) (File No. 001-09614).

10.18(b)10.19(b)
Third Amending Agreement, dated as of February 10, 2017, among Whistler Mountain Resort Limited Partnership and Blackcomb Skiing Enterprises Limited Partnership, as borrowers, the Guarantors Party thereto, and The Toronto-Dominion Bank, as administrative agent, on its own behalf and on behalf of the Lenders (Incorporated by reference to Exhibit 10.1 on Form 10-Q of Vail Resorts, Inc. for the quarter ended January 31, 2017) (File No. 001-09614).
115



10.19Posted
Exhibit
Number		Description
10.19(c)
Fourth Amending Agreement, dated as of November 30, 2018, among Whistler Mountain Resort Limited Partnership and Blackcomb Skiing Enterprises Limited Partnership, as borrowers, the Guarantors Party thereto, and The Toronto-Dominion Bank, as administrative agent, on its own behalf and on behalf of the lenders (Incorporated by reference to Exhibit 10.1 on Form 10-Q of Vail Resorts, Inc. for the quarter ended January 31, 2019) (File No. 001-09614).
10.19(d)
Fifth Amending Agreement, dated as of November 21, 2019, among Whistler Mountain Resort Limited Partnership and Blackcomb Skiing Enterprises Limited Partnership, as borrowers, the Guarantors Party thereto, and The Toronto-Dominion Bank, as administrative agent, on its own behalf and on behalf of the Lenders (Incorporated by reference to Exhibit 10.1 on Form 10-Q of Vail Resorts, Inc. for the quarter ended January 31, 2019) (File No. 001-09614).
10.20
Whistler Mountain Master Development Agreement, dated as of February 23, 2017, between Her Majesty the Queen in Right of the Province of British Columbia and Whistler Mountain Resort Limited Partnership (Incorporated by reference to Exhibit 10.1 on Form 8-K of Vail Resorts, Inc. filed on February 27, 2017) (File No. 001-09614).

10.2010.21
Blackcomb Mountain Master Development Agreement, dated as of February 23, 2017, between Her Majesty the Queen in Right of the Province of British Columbia and Blackcomb Skiing Enterprises Limited Partnership (Incorporated by reference to Exhibit 10.2 on Form 8-K of Vail Resorts, Inc. filed on February 27, 2017) (File No. 001-09614).
21
Subsidiaries of Vail Resorts, Inc.
23
Consent of Independent Registered Public Accounting Firm.
24Power of Attorney. Included on signature pages hereto.
31.1
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32
Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101101.INSXBRL Instance Document - the instance document does not appear in the interactive data file as its XBRL tags are embedded within the inline XBRL document.
101.SCHXBRL Schema Document.
101.CALXBRL Calculation Linkbase Document.
101.DEFXBRL Definition Linkbase Document.
101.LABXBRL Label Linkbase Document.
101.PREXBRL Taxonomy Extension Presentation Linkbase Document.
104The following informationcover page from the Company’s Year Endthis Annual Report on Form 10-K, for the year ended July 31, 2018 formatted in eXtensible Business Reporting Language: (i) Consolidated Balance Sheets as of July 31, 2018 and July 31, 2017; (ii) Consolidated Statements of Operations as of July 31, 2018, July 31, 2017 and July 31, 2016; (iii) Consolidated Statements of Comprehensive Income as of July 31, 2018, July 31, 2017 and July 31, 2016; (iv) Consolidated Statements of Stockholders’ Equity as of July 31, 2018, July 31, 2017 and July 31, 2016 (v) Consolidated Statements of Cash Flows as of July 31, 2018, July 31, 2017 and July 31, 2016; and (vi) Notes to the Consolidated Financial Statements.inline XBRL.
*Management contracts and compensatory plans and arrangements.


ITEM 16.FORM 10-K SUMMARY.

ITEM 16.FORM 10-K SUMMARY.
None.



99
116








SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: September 23, 2021Vail Resorts, Inc.
By:/s/ Michael Z. Barkin
Michael Z. Barkin
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)
Date: September 28, 201823, 2021Vail Resorts, Inc.
By:/s/ Michael Z. BarkinNathan Gronberg
Michael Z. BarkinNathan Gronberg
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)
Date: September 28, 2018Vail Resorts, Inc.
By:/s/ Ryan H. Siurek
Ryan H. Siurek
Senior Vice President, Controller and

Chief Accounting Officer

(Principal Accounting Officer)
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and appoints Michael Z. Barkin or Ryan H. SiurekNathan Gronberg his or her true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Form 10-K and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Form 10-K and any amendments or supplements hereto, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities indicated on September 28, 2018.

23, 2021.
100
117










/s/ Robert A. KatzChief Executive Officer and Chairman of the Board
Robert A. Katz(Principal Executive Officer)
/s/ Michael Z. BarkinExecutive Vice President and Chief Financial Officer
Michael Z. Barkin(Principal Financial Officer)
/s/ Ryan H. SiurekNathan GronbergSenior Vice President, Controller and Chief Accounting Officer
Ryan H. SiurekNathan Gronberg(Principal Accounting Officer)
/s/ Susan L. Decker
Susan L. DeckerDirector
/s/ Roland A. HernandezNadia Rawlinson
Roland A. HernandezNadia RawlinsonDirector
/s/ John T. Redmond
John T. RedmondDirector
/s/ Michele Romanow
Michele RomanowDirector
/s/ Hilary A. Schneider
Hilary A. SchneiderDirector
/s/ D. Bruce Sewell
D. Bruce SewellDirector
/s/ John F. Sorte
John F. SorteDirector
/s/ Peter A. Vaughn
Peter A. VaughnDirector


101

118