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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON June 10, 2011
Registration Statement No. 333-173567
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
 
 
Amendment No. 1
to
FORM S-1
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933
 
 
 
 
Peak Resorts, Inc.
(Exact name of registrant as specified in its charter)
 
         
Missouri
(State or other jurisdiction of
incorporation or organization)
  7990
(Primary Standard Industrial
Classification Code Number)
  43-1793922
(IRS Employer
Identification No.)
 
17409 Hidden Valley Drive
Wildwood, Missouri 63025
(636) 938-7474
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
 
 
 
 
Timothy D. Boyd
17409 Hidden Valley Drive
Wildwood, Missouri 63025
(636) 549-0060
(Name, address, including zip code, and telephone number, including area code, of agent for service)
 
With copies to:
 
     
David W. Braswell
Armstrong Teasdale LLP
7700 Forsyth Boulevard, Suite 1800
St. Louis, Missouri 63105
(314) 552-6631
  Carmelo M. Gordian
David M. Kavanaugh
Laurie M. Pompa
Andrews Kurth LLP
111 Congress Avenue, Suite 1700
Austin, Texas 78701
(512) 320-9290
 
Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement is declared effective.
 
If any securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.  o
 
If this Form is filed to register additional securities for an offering pursuant to Rule 462(c) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o
 
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o
 
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
 
Large accelerated filer o Accelerated filer o Non-accelerated filer x Smaller reporting company o
(Do not check if a smaller reporting company)
 
The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
 


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The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.
 
PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED JUNE 10, 2011
 
 
(COMPANY LOGO)     
 
• Shares
 
Peak Resorts, Inc.
 
Common Stock
 
 
This is the initial public offering of our common stock. We are offering • shares of our common stock. No public market currently exists for our common stock. We currently expect the initial public offering price to be between $  •   and $  •   per share. We have applied to list our common stock on the NASDAQ Global Market (“NASDAQ”) under the symbol “PEAK”. There is no assurance that this application will be approved.
 
 
 
 
Investing in our common stock involves risk. See “Risk Factors” beginning on page 7 to read about risks you should consider before buying our common stock.
 
Neither the Securities and Exchange Commission (the “SEC”), any state securities commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this registration statement. Any representation to the contrary is a criminal offense.
 
 
 
 
                 
    Per
   
    Share   Total
 
Initial public offering price
  $                $             
 
 
Underwriting discount and commissions(1)
  $       $    
 
 
Proceeds, before expenses, to us
  $       $    
 
 
 
(1) The underwriter is also entitled to a common stock purchase warrant and expense reimbursement. See “Underwriting” beginning on page 69 of this Prospectus to read about underwriting discounts, commissions, the warrant and expense reimbursement.
 
The underwriters have an option exercisable within 45 days from the date of this Prospectus to purchase up to • additional shares of common stock from us at the initial public offering price, less the underwriting discount and commissions to cover over-allotments of shares. The shares of common stock issuable upon exercise of the underwriters’ over-allotment option have been registered under the registration statement of which this Prospectus forms a part.
 
In connection with this offering, we have also agreed to issue to the underwriters a common stock purchase warrant to purchase up to an aggregate of • shares of common stock at an exercise price of $ •  per share, assuming an initial public offering price of $ •  per share, which is the mid-point of the range listed above. The warrant is exercisable commencing on the first anniversary of the date of this offering and ending on the fifth anniversary of the effective date of this offering. The warrant is not exercisable or convertible more than five years from the effective date of this offering.
 
The underwriters expect to deliver the common stock against payment in U.S. dollars in New York, New York on or about • , 2011.
 
Rodman & Renshaw, LLC
 
Prospectus dated • , 2011.


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 EX-10.38
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 EX-23.2
 EX-23.3
 
 
 
 
No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this Prospectus. You must not rely on any unauthorized information or representations. This Prospectus is an offer to sell only the shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this Prospectus is current only as of its date.
 
For investors outside the United States: We have not and the underwriters have not done anything that would permit this offering or possession or distribution of this Prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this Prospectus must inform themselves, and observe any restrictions relating to, the offering of the shares of our common stock and the distribution of this Prospectus outside the United States.
 
 
 
 
Dealer Prospectus Delivery Obligation
 
Through and including • , 2011 (the 25th day after the date of this Prospectus), all dealers effecting transactions in these securities, whether or not participating in this offering, may be required to deliver a Prospectus when acting as an underwriter and with respect to an unsold allotment or subscription.


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Trademarks, Trade Names and Service Marks
 
Wildcat Mountain Ski AreaSM, Mount Snow®, Boston Mills Ski ResortSM, Hidden ValleySM and Crotched Mountain Ski AreaSM are trademarks, service marks and trade names owned by certain subsidiaries of Peak Resorts, Inc. All other brand names, trademarks, trade names and service marks referred to in this Prospectus are the property of their respective owners.
 
 
Industry and Market Data
 
Market data and certain industry forecasts used herein were obtained from internal surveys, market research, publicly available information and industry publications. While we believe that market research, publicly available information and industry publications we use are reliable, we have not independently verified market and industry data from third-party sources. Moreover, while we believe our internal surveys are reliable, they have not been verified by any independent source.


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PROSPECTUS SUMMARY
 
This summary highlights information contained elsewhere in this Prospectus. Because this is only a summary, it does not contain all of the information that you should consider in making your investment decision. For a more complete understanding of us and this offering, you should read and consider the entire Prospectus, including the information set forth under “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the financial statements and related notes thereto before deciding whether to invest in our common stock.
 
Except as otherwise required by the context, references to “Company,” “Peak,” “we,” “us” and “our” are to Peak Resorts, Inc. and its subsidiaries. The historical financial statements and financial data included in this Prospectus are those of Peak Resorts, Inc. and its consolidated subsidiaries. Unless otherwise indicated, we have derived industry data from publicly available sources that we believe are reliable.
 
Our Company
 
We are a leader and innovator in the ski industry with 12 ski areas through the Midwest, Northeast and Southeast United States. Our ski areas offer guests high-quality skiable terrain as well as terrain parks for snowboarding and other snow sports. We employ modern snowmaking technology on a majority of our terrain that gives our guests an opportunity to participate in snow sports even in less-than-favorable weather.
 
Combined, our ski areas had approximately 1.7 million skier visits in the 2009/2010 ski season and approximately 1.8 million skier visits in the 2010/2011 ski season, which we believe put us among the top U.S. companies in terms of number of skier visits during these seasons. We now operate more ski areas than any other company in the United States. Through development and acquisitions, our revenues have grown approximately 205% from fiscal 2006 to fiscal 2010.
 
Our largest source of revenue is the sale of ski lift tickets, followed by food and beverage sales, equipment rentals, ski instruction services, hotel/lodging and merchandise sales. We generated approximately $98 million in revenue during fiscal 2011.
 
Ski Industry
 
The United States ski industry divides ski areas into three categories: overnight fly destination ski areas, overnight drive ski areas and day ski areas. We own or lease and operate overnight drive ski areas and day ski areas, which are located in or near metropolitan areas and target a regional market. Our resorts appeal to both beginner and advanced skiers and draw on the younger generation of snowboarders and others participating in alternative snow sports.
 
Our Strengths
 
  •   Our ski areas are located in geographically diverse areas.  Adverse weather patterns are challenges that all ski area operators face. In order to mitigate the negative effects that adverse weather may have on our overall financial results, we have strategically acquired or developed our ski areas in geographically diverse regions of the United States in order to compensate for any adverse weather that one region may experience over another during a particular ski season.
 
  •   We own or lease and operate all of our ski areas.  We are unique in the ski industry in that we not only own or lease our ski areas, but we operate all 12 of our ski areas, giving us and our employees the specialized skills and experience necessary to maintain our past success. With this knowledge, we believe that we are in a better position to maximize our operational efficiencies and integrate the businesses of any future ski areas that we may acquire or develop.
 
  •   Our acquisition strategy has proven successful.  Our commitment to efficient snowmaking and our desire to diversify our ski area locations have been a key component of our past acquisition strategy. Our management team has been successful in implementing this strategy in the past, and as a result, we have enhanced our presence in certain regions and built a new presence in others,


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  while complementing our existing ski area portfolio. The business and acquisition experience of our management team has allowed us to integrate these new businesses smoothly and profitably.
 
  •   We utilize modern snowmaking technology.  We are committed to providing our guests quality ski experiences, but at the same time, are focused on reducing our costs and energy uses. We have invested in snowmaking technology on a majority of our terrain that allows us to make a significant amount of snow while reducing our energy costs.
 
Our Strategy
 
  •   We invest in and improve our existing ski areas.  Our financial success depends, in large part, on maintaining and increasing our skier visits. We have invested substantial amounts of money to adopt what we believe to be the most efficient snowmaking system available as standard equipment at all of our resorts. We believe that our snowmaking system provides us with a competitive advantage over other ski area operators. We also continually improve the existing facilities and equipment at our ski areas and are currently seeking permits for the redevelopment of our largest ski area, Mount Snow.
 
  •   We monitor potential acquisition targets to build geographical diversity and increase market share.  We believe that, given our profitable results at our current resorts and our proven acquisition history, we are positioned for further growth within the day ski area and overnight drive ski area markets. Our past acquisitions have been driven by our goals to diversify our locations and increase skier visits, which will continue to be the driving factors of any future acquisitions that we may complete.
 
Risk Factors
 
Before you invest in our common stock, you should be aware that there are various risks related to, among other things:
 
  •  weather;
 
  •  seasonality;
 
  •  competition with other leisure activities and ski areas;
 
  •  the leases and permits for property underlying certain of our ski areas;
 
  •  new acquisitions;
 
  •  environmental laws and regulations;
 
  •  our dependence on key personnel;
 
  •  the security of our guest information;
 
  •  funds for capital expenditures;
 
  •  the effect of declining revenues on margins;
 
  •  the development of our Mount Snow ski area;
 
  •  our reliance on information technology;
 
  •  our dependence on a single lender and the lender’s option to purchase certain of our ski areas;
 
  •  our dependence on a seasonal workforce; and
 
  •  the securities markets.
 
For more information about these and other risks, please read the section titled “Risk Factors.” You should carefully consider these risk factors together with all of the other information in this Prospectus.


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Corporate History and Additional Information
 
Peak Resorts, Inc. was incorporated in Missouri on September 24, 1997 as a holding company to own or lease and operate day ski areas and overnight drive destination ski areas through its wholly-owned subsidiaries. Throughout the history of the Company, including the development of the Hidden Valley and Snow Creek ski areas before the incorporation of Peak Resorts, Inc., the Company has acquired or developed a total number of 12 ski areas.
 
Our principal executive offices are located at 17409 Hidden Valley Drive, Wildwood, Missouri 63025, telephone (636) 938-7474. We maintain a website at www.peakresorts.com. We will make available on our website, free of charge, the Company’s future annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K as soon as practical after we file these reports with the U.S. Securities and Exchange Commission (the “SEC”). The information contained on our website or that can be accessed through our website neither constitutes part of this Prospectus nor is incorporated by reference herein.
 
Summary of the Offering
 
Common stock offered by us  •  shares (or •  shares if the underwriters exercise their over-allotment option in full). We are not registering any shares of common stock held by our stockholders.
 
Common stock to be outstanding after the offering
 • shares (or • shares if the underwriters exercise their over-allotment option in full).
 
Proposed trading symbol on NASDAQ Global Market “PEAK”
 
Use of proceeds We estimate that we will receive proceeds of approximately $ •  million from our offering of our common stock, after deducting underwriting discounts and commissions and estimated offering expenses payable by us, assuming the shares are offered at $ •  per share, which is the midpoint of the estimated offering price range shown on the front cover page of this Prospectus. We will use approximately $ •  of the net proceeds from this offering to repay a portion of the outstanding balance due under a promissory note in favor of our lender for the development of our Mount Snow ski area. In addition, we will use approximately $ •  million of the proceeds to partially fund the purchase and construction of a new chair lift at Mount Snow. We intend to use the remaining proceeds for working capital and general corporate purposes. See “Use of Proceeds” for additional details.
 
Dividend policy We currently expect to pay dividends on a quarterly basis, subject to the availability of funds during the quarterly periods. Our ability to pay dividends on our common stock is also limited by our existing debt agreements and may be further restricted by the terms of any future debt or preferred securities. See “Dividend Policy” for additional details.
 
Risk factors Investment in our common stock involves a high degree of risk. You should read and consider the information set forth under the heading “Risk Factors” and all other information included in this Prospectus before deciding to invest in our common stock.
 
The number of shares of common stock shown in this Prospectus to be outstanding after this offering is based on the number of shares outstanding as of • , 2011 and excludes •  shares reserved for issuance pursuant to the 2011 omnibus incentive plan that we intend to adopt prior to the completion of this offering. Except as otherwise noted, all information in this Prospectus:
 
  •  assumes no exercise of the underwriters’ overallotment option;


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  •  does not give effect to the Company’s C-corporation election to be effected prior to the offering; and
 
  •  does not give effect to an assumed 175 for 1 stock split to be effective as of • , 2011.
 
Summary Historical Consolidated Financial Data
 
The following summary consolidated financial information for each of the years in the three-year period ended April 30, 2011 is based on our audited consolidated financial statements included elsewhere in this Prospectus. The information set forth below should be read together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated historical financial statements and the notes to our consolidated financial statements included elsewhere in this Prospectus.
 
                         
    Year ended April 30,  
    2011     2010     2009  
    (In thousands, except per share information and ski areas owned/leased and operated)  
 
Income Statement Information:
                       
Revenues
  $ 97,586     $ 89,846     $ 84,293  
Operating expenses
    80,817       76,074       74,393  
     
     
Income from operations
    16,769       13,772       9,900  
Interest expense, net
    (11,338 )     (11,370 )     (10,818 )
Other income, excluding interest
    973       431       426  
     
     
Income (loss) before taxes
    6,404       2,833       (492 )
Income tax expense(1)
    (10,410 )            
     
     
Net Income (loss)
  $ (4,006 )   $ 2,833     $ (492 )
     
     
Basic and diluted earnings (loss) per share
  $ (100.59 )   $ 71.14     $ (12.36 )
Basic and diluted earnings (loss) per share assuming stock split prior to pro forma tax adjustment(2)
  $ (0.57 )   $ 0.41     $ (0.07 )
     
     
                         
Pro Forma Adjustments:
                       
Net Income (loss) before taxes as reported
  $ 6,404     $ 2,833     $ (492 )
Pro forma adjustment for income tax expense (benefit)(3)
    2,546       1,208       (8 )
     
     
Pro forma net income (loss)
  $ 3,858     $ 1,625     $ (484 )
     
     
Pro forma basic and diluted net income (loss) per share assuming tax adjustment
  $ 96.88     $ 40.80     $ (12.16 )
     
     
Pro forma basic and diluted net income (loss) per share assuming pro forma tax adjustment and stock split(2)
  $ 0.55     $ 0.23     $ (0.07 )
     
     
                         
Other Financial Information (unaudited):                        
Reported EBITDAR(4)
  $ 26,770     $ 23,175     $ 18,548  
Capital expenditures(5)
    19,116       6,009       12,076  
Cash (end of period)(6)
    16,463       19,508       10,937  
Total debt (end of period)(7)
    144,058       138,621       134,856  
                         
Operating data (unaudited):
                       
Skier visits
    1,752       1,669       1,543  
Ski areas owned/leased and operated(8)
    12       11       11  


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The following table presents a summary of our balance sheet as of April 30, 2011 on an actual basis and on a pro forma basis to reflect the sale in this offering of •  shares of common stock at an assumed initial public offering price of $ •  per share, which is the mid-point of the range listed on the cover of this Prospectus, after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.
 
                 
    As of April 30, 2011
 
    (Unaudited)  
          Pro Forma
 
    Actual     Offering  
       
    (In thousands)  
 
Balance Sheet Information:
               
Cash (6)
  $   16,463     $          
Total assets
    180,521          
Net property and equipment
    117,801          
Debt (including current portion)
    144,058          
Stockholders’ equity
    7,578          
 
(1) Prior to its C-corporation election, the Company and its subsidiaries elected and received approval from the Internal Revenue Service to be taxed as S-corporations for federal tax purposes. Pursuant to those elections, federal income taxes and income taxes related to certain other jurisdictions are the responsibility of the individual stockholders, and therefore, the consolidated statements of loss included with this Prospectus do not include provisions for income taxes. One state in which the Company operates does not recognize the Company’s S-corporation election; however, entity level income taxes levied by that state are immaterial.
 
(2) Where noted, per share calculations reflect the assumed 175 for 1 stock split to be effected prior to this offering.
 
(3) Effective as of April 30, 2011, the Company terminated its S-corporation election and is now taxed as a C-corporation. As a C-corporation, the Company will be liable for federal and state corporate income taxes on its taxable income. As result of the termination of the subchapter S-election, the Company recognized deferred income tax expense, such expense resulting from the recognition of its deferred tax assets and liabilities at April 30, 2011, the date it became a C-corporation. For fiscal 2011, pro forma income tax expense excludes the impact of the deferred taxes recorded as a result of the S-corporation election and, similar to fiscal 2010 and fiscal 2009, assumes income tax expense as if the Company was a C-corporation for the entire year.
 
(4) We have chosen to specifically include Reported EBITDAR (defined as net income before interest, income taxes, depreciation and amortization, gain on sale leaseback, investment income, other income or expense, property rent and other non-recurring items) as a measurement of our results of operations because we consider this measurement to be a significant indication of our financial performance and available capital resources. Reported EBITDAR is not a measure of financial performance under U.S. generally accepted accounting principles (“GAAP”). We provide a reconciliation of Reported EBITDAR to net income, the most directly-comparable GAAP measurement, below.
 
Management considers Reported EBITDAR to be a significant indication of our financial performance and available capital resources. Because of large depreciation and other charges relating to our ski areas, it is difficult for management to fully and accurately evaluate our financial results and available capital resources using net income. Management believes that by providing investors with Reported EBITDAR, investors will have a clearer understanding of our financial performance and cash flow because Reported EBITDAR: (i) is widely used in the ski industry to measure a company’s operating performance without regard to items excluded from the calculation of such measure, which can vary by company primarily based upon the structure or existence of their financing; (ii) helps investors to more meaningfully evaluate and compare the results of our operations from period to period by removing the effect of our capital structure and asset base from our operating structure; and (iii) is used by our management for various purposes, including as a measure of performance of our operating entities and as a basis for planning. Furthermore, as noted above, Reported EBITDAR excludes land and property rent. Financing costs on land and property that we own are accounted for as interest expense, which is also excluded in Reported EBITDAR. Rent costs associated with the land and property that we lease are not, however, accounted for as interest expense, but have the same effect on our operating results as the financing costs on property that we own. As such, we believe


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that excluding land and property rent from our net income in Reported EBITDAR provides management and investors with a more accurate understanding of our cash flow and results of operations, as noted in this paragraph.
 
Items excluded from Reported EBITDAR are significant components in understanding and assessing financial performance or liquidity. Reported EBITDAR should not be considered in isolation or as 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 Reported EBITDAR is not a measurement determined in accordance with GAAP and is susceptible to varying calculations, Reported EBITDAR as presented may not be comparable to other similarly titled measures of other companies.
 
The following table includes a reconciliation of Reported EBITDAR to net income (loss) (in thousands):
 
                         
    Year Ended April 30,
 
    2011     2010     2009  
       
 
Net income (loss)
  $ (4,006 )   $ 2,833     $ (492 )
Income tax provision
    10,410              
Interest expense, net
    11,338       11,370       10,818  
Depreciation and amortization
    8,054       7,545       6,813  
Land and building rent
    1,948       1,858       1,835  
Investment income
    (241 )     (98 )     (269 )
Gain on sale/leaseback
    (333 )     (333 )     (333 )
Gain on acquisition
    (400 )            
Other
                176  
     
     
Reported EBITDAR
  $   26,770     $   23,175     $   18,548  
   
 
(5) Capital expenditures include the Wildcat Mountain acquisition for the year ended April 30, 2011, which was financed with a seller note.
 
(6) Cash excludes restricted cash.
 
(7) Total debt includes current and long-term maturities of long-term debt and capital lease obligations.
 
(8) Effective in October 2010, we acquired substantially all of the assets and business of Wildcat Mountain ski resort. We have included Wildcat Mountain’s results of operations in our financial statements since the date of acquisition.


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RISK FACTORS
 
Investing in our common stock involves a high degree of risk. You should carefully consider and evaluate all of the information in this Prospectus, including the risks and uncertainties described below, which we believe describe the most significant risks of an investment in our common stock, before making a decision to invest in our common stock. The occurrence of any of the following risks and uncertainties could harm our business, financial condition, results of operations or growth prospects. As a result, the trading price of our common stock could decline, and you could lose all or part of your investment.
 
Risks Related to the Company
 
Our business is vulnerable to the risk of unseasonably warm weather conditions and skier perceptions of weather conditions.
 
The ability to attract visitors to our resorts is influenced by weather conditions and by the number of cold weather days during the ski season. Unseasonably warm weather can adversely affect skier visits and our revenue and profits. For example, warm weather may result in inadequate natural snowfall and render snowmaking wholly or partially ineffective in maintaining quality skiing conditions. Also, the early season snow conditions and skier perceptions of early season snow conditions influence the momentum and success of the overall season. 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.
 
Our business is highly seasonal and the occurrence of certain events during our peak times could have a negative effect on our revenues.
 
Our resort operations are highly seasonal. Although the air temperatures and timing and amount of snowfall can influence the number and type of skier visits, the majority of the skier visits are from mid-December to the end of March. Accordingly, during the past three fiscal years, we generated, on average, approximately 91% of our revenues during the third and fourth fiscal quarters. In addition, throughout our peak quarters, we generate the highest revenues on weekends and during three major holiday periods: Christmas, Dr. Martin Luther King, Jr. Day and Presidents Day. During the 2010/2011 ski season, we generated approximately 31% of our revenues on weekends and approximately 27% of our revenues during these three major holiday periods. Our resorts typically experience operating losses and negative cash flows during the first and second quarters of each fiscal year, as a result of the seasonality of our business. 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.
 
A high degree of seasonality in our revenues and our dependence on weekends and the three major ski holidays increases the impact of certain events on our operating results. Adverse weather conditions, equipment failures, and other developments of even moderate or limited duration occurring during these peak business periods could significantly reduce our revenues.
 
We compete with other leisure activities and ski areas, which makes maintaining our customer base difficult.
 
The skiing industry is highly competitive and capital intensive. Our ski resorts located in the Northeastern United States, such as Mount Snow, Attitash and Wildcat Mountain, and those located in the Southeastern United States (which includes Pennsylvania for purposes of ski industry statistics), such as Jack Frost and Big Boulder, compete against other ski areas in their markets for both day skiers and extended travel skiers. Our competitive position depends on a number of factors, such as the quality and coverage of snowmaking operations, resort size, the attractiveness of terrain, lift ticket prices, prevailing weather conditions, the appeal of related services and resort reputation. Some of our competitors have stronger competitive positions in respect of one or more of these factors, which may adversely affect our ability to maintain or grow our customer base.
 
We believe that while our Midwestern United States ski resorts face only limited competition from other ski resorts in the area, our competitors in the Midwest primarily include other recreation resorts, including warm weather resorts and various alternative leisure activities. Our resorts in the Northeastern and Southeastern United States face similar competition, in addition to the competition outlined above. Our ability to maintain our levels of


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skier visits depends on, among other things, weather conditions, costs of lift tickets and related skier services relative to the costs of other leisure activities and our ability to attract people interested in recreational sports.
 
The leases for the land underlying Jack Frost and Big Boulder may be terminated by the landlord and if terminated, would eliminate revenues from these resorts.
 
We do not own the land underlying the Jack Frost and Big Boulder resorts. We have entered into a lease with Big Boulder Corporation and a lease with Blue Ridge Real Estate Company, both of which terminate on December 1, 2033. The terms of the leases provide that the landlord has a right to terminate the leases at any time, upon the payment of approximately $500,000 plus the net book value of the assets relating to the property. If these leases are terminated, we would not be able to operate Jack Frost and Big Boulder, and therefore, the revenues generated by these resorts would be eliminated. Jack Frost and Big Boulder each generated 6% of our consolidated revenues for the fiscal year ended April 30, 2011, respectively.
 
We may engage in acquisitions that could harm our business, operating results or financial condition.
 
A key component of our business strategy is to identify and acquire properties that are complementary to our core business. We continually evaluate potential acquisitions and intend to actively pursue acquisition opportunities, some of which could be significant. For example, our acquisition of Mount Snow in 2007 involved the addition of property and operations that made up 26% of our revenues during the 2007 ski season. Our failure to merge the Mount Snow operations with our existing operations and effectively manage the additional large-scale property would have had a material negative effect on our results of operations.
 
We cannot make assurances that we will be able to successfully integrate and manage acquired properties and businesses and increase our profits from these operations. The integration of acquired businesses may not be successful and could result in disruption to other parts of our business. In addition, the integration may require that we incur significant restructuring charges. To integrate acquired businesses, we must implement our management information systems, operating systems and internal controls, and assimilate and manage the personnel of the acquired operations. The difficulties of the integrations may be further complicated by such factors as geographic distances, lack of experience operating in the geographic market or industry sector of the acquired business, delays and challenges associated with integrating the business with our existing businesses, diversion of management’s attention from daily operations of the business, potential loss of key employees and customers of the acquired business, the potential for deficiencies in internal controls at the acquired business, performance problems with the acquired business’ technology, exposure to unanticipated liabilities of the acquired business, insufficient revenues to offset increased expenses associated with the acquisition, and our ability to achieve the growth prospects and synergies expected from any such acquisition. Even when an acquired business has already developed and marketed products and services, there can be no assurance that product or service enhancements will be made in a timely fashion or that all pre-acquisition due diligence will have identified all possible issues that might arise with respect to such acquired assets.
 
Future acquisitions may also cause us to assume liabilities, record goodwill and non-amortizable intangible assets that will be subject to impairment testing and potential impairment charges, incur amortization expense related to certain intangible assets and increase our expenses and working capital requirements, which would reduce our return on invested capital. Failure to manage and successfully integrate the acquisitions we make could materially harm our business and operating results.
 
We are subject to extensive environmental laws and regulations in the ordinary course of business.
 
Our operations are subject to a variety of federal, state and local environmental laws and regulations, including those relating to emissions to the air; discharges to water; storage, treatment and disposal of wastes; land use; remediation of contaminated sites; and protection of natural resources such as wetlands. For example, future expansions of certain of our ski facilities must comply with applicable forest plans approved under the National Forest Management Act or local zoning requirements. In addition, most projects to improve, upgrade or expand our ski areas are subject to environmental review under the National Environmental Policy Act. Both acts require that the United States Forest Service study any proposal for potential environmental impacts and include in its analysis various alternatives. Our ski area improvement proposals may not be approved or may be approved with modifications that substantially increase the cost or decrease the desirability of implementing the project.


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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.
 
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 own or lease and operate, or formerly owned, leased 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.
 
The loss of our key executive officers would harm our business.
 
Our success depends to a significant extent upon the performance and continued service of our key management team which includes Timothy Boyd, our president and principal executive officer, Stephen Mueller, our vice president and principal financial and accounting officer, and Richard Deutsch, our vice president in charge of business and real estate development. The loss of the services of this management team could have a material adverse effect on our business and operations because of Messers. Boyd’s, Mueller’s and Deutsch’s specific and unique knowledge of operating multiple ski resorts, including day ski areas and overnight drive ski areas.
 
Failure to maintain the integrity of guest data could result in damage to our reputation and/or subject us to costs, fines or lawsuits.
 
We collect personally identifiable information relating to our guests for various business purposes, including marketing and promotional purposes. The integrity and privacy of our guest’s information is important to us, and our guests have a high expectation that we will adequately protect their personal information. The regulatory environment governing privacy laws is increasingly demanding, and privacy laws continue to evolve and, on occasion, may be inconsistent from one jurisdiction to another. Maintaining compliance with applicable privacy regulations may increase our operating costs and/or adversely impact our ability to market our products, properties and services to our guests. Furthermore, non-compliance with applicable privacy regulations by us (or in some circumstances non-compliance by third parties engaged by us), a breach of security on systems storing our guest data, a loss of guest data or fraudulent use of guest data could adversely impact our reputation or result in fines or other damages and litigation.
 
Our business requires significant capital expenditures to both maintain and improve our ski areas and expand our business through acquisitions. The lack of available funds for these capital expenditures could have a material adverse effect on our operating strategy.
 
Sustaining our successful financial performance depends, in part, on our ability to maintain and improve the quality of our facilities, products, and management resources (either directly or through third parties), which requires significant capital expenditures. Capital expenditures for fiscal 2011 were approximately $19 million, and we currently anticipate that capital expenditures will be approximately $11 million to $13 million for fiscal 2012. To the extent that we are unable to obtain the funds necessary to maintain and grow our business with cash generated from operating activities, or from borrowed funds or additional equity investments, our financial condition and results of operations could be affected. Although we believe that capital expenditures above maintenance levels can be deferred to address cash flow or other constraints, these expenditures cannot be deferred for extended periods without adversely affecting our competitive position and financial performance.
 
Historically, a key element of our strategy has been attracting additional skiers through investment in on-mountain capital improvements. These improvements are capital intensive and a lack of available funds for capital expenditures could have a material adverse effect on our ability to implement our operating strategy. We intend to finance resort capital improvements through internally generated funds and proceeds from the offering of debt and equity. There can be no assurance that sufficient funds will be available to fund these capital improvements or that these capital improvements will sustain our customer base, attract additional skiers or generate additional revenues.


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Future acquisitions may require additional debt or equity financing, which in the case of debt financing, will increase our leverage and, in the case of equity financing, would be dilutive to our existing stockholders. Any decline in our perceived credit-worthiness associated with an acquisition could adversely affect our ability to borrow and result in more restrictive borrowing terms. As a result of the foregoing, we also may not be able to complete acquisitions or strategic transactions in the future to the same extent as in the past, or at all. These and other factors could harm our ability to achieve anticipated levels of profitability at acquired operations or realize other anticipated benefits of an acquisition, and could adversely affect our business, financial condition and results of operations.
 
The high fixed cost structure of ski resort operations can result in significantly lower margins if revenues decline.
 
The cost structure of ski resort operations has a significant fixed component with variable expenses including, but not limited to, resort related fees, credit card fees, retail/rental cost of sales and labor, ski school labor and dining 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. 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 wages and other labor costs, energy, healthcare, insurance, transportation, fuel, and other expenses included in our fixed cost structure may also reduce our margin, profits and cash flows.
 
We may be unable to further develop our Mount Snow property if we are unable to obtain approval under Vermont’s Act 250.
 
We have plans to further develop our resort at Mount Snow. Such plans are subject to approval by the Vermont District Environmental Commission under Vermont’s Act 250, the Land Use and Development Act. Our master plan is currently in the approval process, but we will also need to submit applications for the construction phases after the master plan has been approved. Our master plan contemplates the redevelopment of skier service buildings, parking lots and ski-in/ski-out real estate. Failure to obtain approval at any stage of the process could cause a delay of such plans or prevent us from executing such redevelopment plans that we expect will enhance a skier’s experience at Mount Snow.
 
We lease all or some of the land underlying certain of our resorts from third parties.
 
We lease some or all of our property at Paoli Peaks, Crotched Mountain, Mad River, Jack Frost and Big Boulder from third parties. Our lease at Paoli Peaks terminates in 2078, our lease at Crotched Mountain terminates in 2053 (though we have 10 options to extend the lease for additional periods of 15 years each), and our lease at Mad River terminates in 2026. Currently, the leases for our Jack Frost and Big Boulder resorts provide that the lessor has a right to terminate the leases at any time, upon the payment of certain fees. Combined, these resorts contributed approximately 27.8% of our total revenues for the year ended April 30, 2011. A termination of any of these leases could negatively impact our results of operations.
 
A substantial portion of the skiable terrain at certain of our resorts is used under the terms of Forest Service permits.
 
A substantial portion of the skiable terrain at our Attitash and Mount Snow resorts and all of the land underlying the Wildcat Mountain resort is federal land that is used under the terms of permits with the United States Forest Service. The permits give the United States Forest Service the right to review and comment on the location, design, and construction of improvements in the permit area and on certain other operational matters. The permits can also be terminated or modified by the United States Forest Service for specific compelling reasons or in the event we fail to perform any of our obligations under the permits. Otherwise, the permits may be renewed. A termination or modification of any of our permits could have a material adverse affect on our results of operations. Currently, our permits expire as follows:
 
     
Ski Area   Special Use Permit Expiration Date
Attitash   April 4, 2047
Mount Snow   April 4, 2047
Wildcat Mountain   November 18, 2050


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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.
 
We depend on the use of information technology and systems, including technology and systems used for central reservations, point of sale, procurement and administration. 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 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, we 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 in implementing new or enhanced systems 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 our quality of service that we offer to our guests. Also, we may be unable to devote financial resources to new technologies and systems in the future. If any of these events occur, our business and financial performance could suffer.
 
We currently rely on one lender and its affiliates as a source for financing and credit.
 
We have historically relied on one lender and its affiliates, Entertainment Properties Trust, Inc. (“EPT”), for substantially all of our financing and credit needs, including financing relating to our resort acquisitions. EPT is an entertainment, entertainment-related, recreation and specialty real estate company with its common stock listed on the New York Stock Exchange under the symbol “EPR”. In the event EPT is not available to extend us credit, we may not be able to obtain financing on terms as favorable to us as those under our arrangements with EPT. As a result, we may be subject to more stringent financial covenants and higher interest rates.
 
We depend on a seasonal workforce.
 
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. We cannot guarantee that material increases in the cost of securing our seasonal workforce will not be necessary in the future. Furthermore, we cannot guarantee that we will be able to recruit and hire adequate seasonal personnel as the business requires. Increased seasonal wages or an inadequate workforce could have an adverse impact on our results of operations.
 
We are subject to litigation in the ordinary course of business because of the nature of our business.
 
The safety of guests and employees is a major concern and focus for all managers and employees of the Company. By the nature of our activities, we are exposed to the risk that guests or employees may be involved in accidents during the use, operation or maintenance of ski lifts, rides and other resort facilities. As a result, 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 that the outcome of all current or future litigation will not have a material adverse effect on us and our results of operations.
 
If we fail to manage future growth effectively, our business could be harmed.
 
We have experienced, and expect to continue to experience, rapid growth. This growth has placed significant demands on our management, operational and financial infrastructure. To manage growth effectively, we must continue to improve and enhance our managerial, operational and financial controls, train and manage our employees, and expand our employee base. We must also manage new and existing relationships with vendors, business partners and other third parties. These activities will require significant expenditures and allocation of valuable management resources. If we fail to maintain the efficiency of our organization as we grow, our profit margins may decrease, and we may be unable to achieve our business objectives.


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A disruption in our water supply would impact our snowmaking capabilities and impact our operations.
 
Our operations are heavily dependent upon our access to adequate supplies of water with which to make snow and otherwise conduct our operations. Our resorts in New Hampshire and Vermont are subject to state laws and regulations regarding our use of water. There can be no assurance that applicable laws and regulations will not change in a manner that could have an adverse effect on our operations, or that important permits, licenses, or agreements will not be canceled or will be renewed on terms as favorable as the current terms. Any failure to have access to adequate water supplies to support our current operations and anticipated expansion would have a material adverse effect on our financial condition and results of operations.
 
Our lender has an option to purchase, or assume our leases relating to, certain of our ski areas. If our lender exercises this option, we would incur significant tax obligations.
 
On October 30, 2007, we entered into an Option Agreement with EPT Ski Properties, Inc., a subsidiary of our lender, EPT, pursuant to which EPT Ski Properties, Inc. has the option to a) purchase Hidden Valley, Snow Creek, Brandywine, Boston Mills and the portion of Paoli Peaks that we own, at the prices set forth in the Option Agreement, and b) assume our leases relating to Big Boulder, Jack Frost and the portion of Paoli Peaks that we lease. According to the terms of the Option Agreement, EPT Ski Properties, Inc. may exercise its option relating to one or more properties on or after April 11, 2011 until we satisfy our obligations under the Amended and Restated Credit and Security Agreement among certain of our subsidiaries and EPT Ski Properties, Inc., dated as of October 30, 2007, as amended. If EPT Ski Properties, Inc. exercises its option with respect to any of the properties, it is required under the Option Agreement to immediately lease or sublease such properties back to us on substantially the same terms as the existing financing or lease arrangements relating to the properties.
 
Over the years, we have depreciated the value of these properties pursuant to applicable accounting rules, and as such, we have a low basis in the properties. As a result, we will realize significant gains on the sale of the properties to EPT Ski Properties, Inc. if the option is exercised. We will be required to pay capital gains tax on the difference between the purchase price of the properties and the tax basis in the properties, which we expect to be a substantial cost. As of the date of this Prospectus, EPT Ski Properties, Inc. has not exercised the option.
 
We are structured as a holding company and have no assets other than the common stock of our subsidiaries.
 
We are a holding company and we do not currently have any material assets other than the common stock we own in our direct and indirect subsidiaries. Our working capital needs are dependent, in part, upon the receipt of dividends and other distributions from our subsidiaries. Certain laws may restrict or limit such payments to us by our subsidiaries, in which case we may need to seek other sources of funding.
 
A natural disaster could damage our property and reduce the number of guests who visit our resorts.
 
A severe natural disaster, such as a forest fire, flood or landslide, may interrupt our operations, damage our properties and reduce the number of guests who visit our resorts in affected areas. 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 or the expense of the interruption to our business. 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 resorts is also influenced by the aesthetics and natural beauty of the outdoor environment where our resorts are located. A severe forest fire or other severe impacts from naturally occurring events could negatively impact the natural beauty of our resorts and have a long-term negative impact on our overall guest visitation as it would take several years for the environment to recover.
 
Climate change and greenhouse effects may adversely impact our results of operations.
 
There is a growing political and scientific consensus that emissions of greenhouse gases continue to alter the composition of the global atmosphere in ways that are affecting and are expected to continue affecting the global climate. The effects of climate change, including any impact of global warming, could have a material adverse effect on our results of operations.
 
Warmer overall temperatures would likely adversely affect skier visits and our revenue and profits. As noted above, warm weather may result in inadequate natural snowfall and render snowmaking wholly or partially


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ineffective in maintaining quality skiing conditions. In addition, a steady increase in global temperatures could shorten the ski season in the future.
 
Physical risks from climate change may also include an increase in changes to precipitation and extreme weather events in ways we cannot currently predict. Such changes to the amount of natural snowfall and extreme differences in weather patterns may increase our snowmaking expense, inhibit our snowmaking capabilities and negatively impact skier perceptions of the ski season.
 
Risks Related to this Offering and Ownership of Our Common Stock
 
An active, liquid trading market for our common stock may not develop.
 
Prior to this offering, there has not been a public market for our common stock. We cannot predict the extent to which investor interest in our Company will lead to the development of a trading market on the NASDAQ Global Market or otherwise or how active and liquid that market may become. If an active and liquid trading market does not develop, you may have difficulty selling any of our common stock that you purchase. The initial public offering price for the shares will be determined by negotiations between us and the underwriters and may not be indicative of prices that will prevail in the open market following this offering. The market price of our common stock may decline below the initial offering price, and you may not be able to sell your shares of our common stock at or above the price you paid in this offering, or at all.
 
Our stock price may change significantly following the offering, and you could lose all or part of your investment as a result.
 
We and the underwriters will negotiate to determine the initial public offering price. You may not be able to resell your shares at or above the initial public offering price or at all due to a number of factors such as those listed in “— Risks Related to the Company” and the following, some of which are beyond our control:
 
  •   quarterly variations in our results of operations;
 
  •   results of operations that vary from those of our competitors;
 
  •   changes in expectations as to our future financial performance, including financial estimates by securities analysts and investors;
 
  •   announcements by us, our competitors or our vendors of significant contracts, acquisitions, joint marketing relationships, joint ventures or capital commitments;
 
  •   announcements by third parties of significant claims or proceedings against us;
 
  •   future sales of our common stock; and
 
  •   changes in investor sentiment toward the stock of ski resort and recreational services companies in general.
 
Furthermore, the stock market has recently experienced extreme volatility that in some cases has been unrelated or disproportionate to the operating performance of particular companies. These broad market and industry fluctuations may adversely affect the market price of our common stock, regardless of our actual operating performance.
 
In the past, following periods of market volatility, stockholders have instituted securities class action litigation. If we were involved in securities litigation, it could be a substantial cost and divert resources and the attention of executive management from our business regardless of the outcome of such litigation.
 
Requirements associated with being a public company will increase our costs, as well as divert Company resources and management’s attention, and may affect our ability to attract and retain qualified board members and executive officers.
 
Prior to this offering, we have not been subject to the reporting requirements of the Securities Exchange Act of 1934 (the “Exchange Act”) or the other rules and regulations of the SEC or any securities exchange relating to public companies. Upon becoming a public company, we will be required to comply with the SEC’s rules implementing Section 302 of the Sarbanes-Oxley Act of 2002, which will require our management to certify


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financial and other information in our quarterly and annual reports and provide an annual management report on the effectiveness of our internal control over financial reporting. We will not be required to make our first assessment of our internal control over financial reporting until the year following our first annual report required to be filed with the SEC. Our independent registered public accounting firm will be required to formally attest to the effectiveness of our internal control over financial reporting when we become an “accelerated filer” as defined in Rule 12b-2 of the Exchange Act.
 
We are working with our legal, independent accounting, and financial advisors to identify those areas in which changes or enhancements should be made to our financial and management control systems to manage our growth and obligations as a public company. Some such areas include corporate governance, corporate control, internal audit, disclosure controls and procedures, and financial reporting and accounting systems. We have made, and will continue to make, changes in these and other areas. However, the expenses that will be required in order to prepare adequately for becoming a public company could be material.
 
Compliance with the various reporting and other requirements applicable to public companies will also require considerable time and attention of management. We cannot predict or estimate the amount of the additional costs we may incur, the timing of such costs or the impact that our management’s attention to these matters will have on our business. In addition, the changes we make may not be sufficient to satisfy our obligations as a public company on a timely basis or at all.
 
In addition, being a public company could make it more difficult or more costly for us to obtain certain types of insurance, including directors’ and officers’ liability insurance, and we may be forced to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. The impact of these events could also make it more difficult for us to attract and retain qualified persons to serve on our board of directors, our board committees and our executive team.
 
Our principal stockholders may exert substantial influence over us and may exercise their control in a manner adverse to your interests.
 
We expect that upon completion of this offering, Timothy D. Boyd, Stephen J. Mueller and Richard Deutsch, three of our named executive officers, along with three of Mr. Boyd’s siblings will own, together, a majority of our outstanding stock. Because a limited number of persons may exert substantial influence over us, transactions could be difficult or impossible to complete without the support of those persons. It is possible that these persons will exercise control over us in a manner adverse to your interests.
 
Future sales of our common stock may cause our stock price to decline.
 
If our existing stockholders sell, or indicate an intention to sell, substantial amounts of our common stock in the public market following this offering, the market price of our common stock could decline. These sales might also make it more difficult for us to sell additional equity securities at a time and price that we deem appropriate. Based on • shares of common stock outstanding as of • , upon completion of this offering, we will have • shares of common stock outstanding. Of these outstanding shares, all of the shares of our common stock sold in this offering will be freely tradable in the public market, except for any shares held by our affiliates as defined in Rule 144 of the Securities Act.
 
We, our directors and executive officers and substantially all of our stockholders have agreed with the underwriters, subject to certain exceptions, not to dispose of or hedge any shares of our common stock or any securities convertible into, or exercisable or exchangeable for, shares of our common stock for a period of 180 days from the date of this Prospectus, which may be extended upon the occurrence of specified events, except with the prior written consent of Rodman & Renshaw, LLC. Rodman & Renshaw, LLC, in its sole discretion, may release any of the securities subject to these lock-up agreements at any time without notice.
 
After the expiration of the lock-up agreements and other contractual restrictions that prohibit transfers for at least 180 days after the date of this Prospectus, up to • restricted securities may be sold into the public market in the future without registration under the Securities Act to the extent permitted under Rule 144. Of these restricted securities, approximately • shares will be available for sale approximately • days after the date of this Prospectus subject to volume or other limits under Rule 144.


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If securities or industry analysts do not publish research or reports about our business, if they adversely change their recommendations regarding our common stock, or if our operating results do not meet their expectations, our stock price and trading volume could decline.
 
The trading market for our common stock will be influenced by the research and reports that securities or industry analysts publish about us or our business. Securities analysts may elect not to provide research coverage of our common stock. This lack of research coverage could adversely affect the price of our common stock. We do not have any control over these reports or analysts. If any of the analysts who cover our Company downgrades our stock, or if our operating results do not meet the analysts’ expectations, our stock price could decline. Moreover, if any of these analysts ceases coverage of our Company or fails to publish regular reports on our business, we could lose visibility in the financial markets, which in turn could cause our stock price and trading volume to decline.
 
You will experience immediate and substantial dilution in the book value of your common stock as a result of this offering.
 
The initial public offering price of our common stock is considerably more than the pro forma, net tangible book value per share of our outstanding common stock. This reduction in the value of your equity is known as dilution. This dilution occurs in large part because our earlier investors paid substantially less than the initial public offering price when they purchased their shares. Investors purchasing common stock in this offering will incur immediate dilution of $ •  in pro forma, net tangible book value per share of common stock, based on the assumed initial public offering price of $ •  per share which is the midpoint of the price range listed on the front cover page of this Prospectus. In addition, following this offering, purchasers in the offering will have contributed • % of the total consideration paid by our stockholders to purchase shares of common stock. For a further description of the dilution that you will experience immediately after this offering, see the section of this Prospectus entitled “Dilution.” In addition, if we raise funds by issuing additional securities, the newly-issued shares will further dilute your percentage ownership of our Company.
 
Our management will have broad discretion over the proceeds we receive in this offering and might not apply the proceeds in ways that increase the value of your investment.
 
Our management will have broad discretion to use our net proceeds from this offering, and you will be relying on their judgment regarding the application of these proceeds. Our management might not apply our net proceeds of this offering in ways that increase the value of your investment. We expect to use the net proceeds from this offering to repay existing debt, to partially fund a new chair lift and for general working capital purposes. You will not have the opportunity to influence our decisions on how to use our net proceeds from this offering.
 
We have anti-takeover provisions in our organizational documents that may discourage a change of control.
 
Certain provisions of our amended and restated articles of incorporation and amended and restated bylaws may have an anti-takeover effect and may delay, defer or prevent a tender offer or takeover attempt that a stockholder might consider in its best interest, including those attempts that might result in a premium over the market price for the shares held by our stockholders.
 
These provisions provide for, among other things:
 
  •   advance notice for nominations of directors by stockholders and for stockholders to include matters to be considered at our annual meetings;
 
  •   certain limitations on convening special stockholder meetings;
 
  •   the removal of directors only for cause by our board of directors or upon the affirmative vote of holders of at least 66-2/3% of the shares of common stock entitled to vote generally in the election of directors; and
 
  •   that the amended and restated bylaws may only be amended by our board of directors.
 
These anti-takeover provisions could make it more difficult for a third party to acquire our Company, even if the third party’s offer may be considered beneficial by many of our stockholders. As a result, our stockholders may be limited in their ability to obtain a premium for their shares.


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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
 
This Prospectus contains “forward-looking statements” within the meaning of the federal securities laws. All statements other than statements of historical facts included in this Prospectus, including statements regarding our future financial position, economic performance, results of operations, business strategy, budgets, projected costs, plans and objectives of management for future operations, and the information referred to under “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” are forward-looking statements. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology, such as “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “continue” or similar terminology, although not all forward-looking statements contain these words. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, you are cautioned that any such forward-looking statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Although we believe that the expectations reflected in such forward-looking statements are reasonable as of the date made, expectations may prove to have been materially different from the results expressed or implied by such forward-looking statements. Unless otherwise required by law, we also disclaim any obligation to update our view of any such risks or uncertainties or to announce publicly the result of any revisions to the forward-looking statements made in this Prospectus. Important factors that could cause actual results to differ materially from our expectations include, among others (including the factors described in the section entitled “Risk Factors” in this Prospectus):
 
  •   unfavorable weather conditions;
  •   seasonality of operations;
  •   competition;
  •   continuation of our property leases;
  •   future acquisitions;
  •   environmental regulations;
  •   maintenance of private guest information;
  •   capital expenditures;
  •   development of Mount Snow land;
  •   continuation of forest service permits;
  •   dependence on our lender;
  •   litigation; and
  •   disruption in our water supply.
 
You should also refer to the section of this Prospectus entitled “Risk Factors” for a discussion of factors that may cause our actual results to differ materially from those expressed or implied by our forward-looking statements. As a result of these factors, we cannot assure you that the forward-looking statements in this Prospectus will prove to be accurate. Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracy may prove to be material. In light of the significant uncertainties in these forward-looking statements, you should not regard these statements as a representation or warranty by us or any other person that we will achieve our objectives and plans in any specified time-frame, or at all.
 
All written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by these cautionary statements. You should evaluate all forward-looking statements made in this Prospectus in the context of these risks and uncertainties.
 
We caution you that the important factors referenced above may not contain all of the factors that are important to you.


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CORPORATE ORGANIZATIONAL STRUCTURE
 
(FLOW CHART LOGO)
 
USE OF PROCEEDS
 
We estimate that we will receive net proceeds of approximately $ •  million from the sale of • shares of our common stock in this offering, assuming an initial public offering price of $ •  per share, the mid-point of the estimated price range set forth on the cover page of this Prospectus, and after deducting the underwriting discounts and commissions and estimated offering expenses payable by us.
 
We intend to use approximately $ •  million of the net proceeds from this offering for repayment of a portion of the outstanding debt relating to the development of our Mount Snow ski area. On April 4, 2007, we and our subsidiary Mount Snow, Ltd., as borrowers, entered into a promissory note in favor of EPT Mount Snow, Inc., as lender, in the amount of $25.0 million, which was later modified by the Modification Agreement dated as of April 1, 2010 to increase the amount of funds available under such loan to $41.0 million. The outstanding balance under this promissory note accrues interest at a rate of 10.00% annually.
 
We intend to use approximately $ •  million of the net proceeds to partially fund the purchase and construction of a new high-speed six-passenger bubble chair lift at Mount Snow.
 
The remaining proceeds will be used for working capital and general corporate purposes.
 
Pending these uses, we plan to invest the net proceeds in a variety of capital preservation instruments, including short-term, interest bearing investment grade securities. The goal with respect to the investment of these net proceeds is capital preservation and liquidity so that such funds are readily available.
 
DIVIDEND POLICY
 
We intend to pay dividends on our common stock quarterly, subject to the availability of funds during the quarterly periods. Any decision to pay dividends, however, is at the discretion of our board of directors and will depend on, among other things, our results of operations, financial condition, level of indebtedness, cash requirements, contractual restrictions and other factors that our board of directors may deem relevant. In addition, our ability to pay dividends is limited by our existing debt agreements and may be further limited by the terms of any future debt or preferred securities.


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CAPITALIZATION
 
The following table sets forth our capitalization as of April 30, 2011 on an actual basis and on a pro forma basis to reflect the sale in this offering of •  shares of common stock at an assumed initial offering price of •  per share, which is the mid-point of the range listed on the cover of this Prospectus, after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.
 
You should read the following table in conjunction with our consolidated financial statements and related notes, “Selected Historical Consolidated Financial Data” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” included elsewhere in this Prospectus.
 
                 
    (in millions)  
    As of April 30, 2011
 
    (unaudited)  
          Pro Forma
 
    Adjusted     Offering1  
 
Cash and cash equivalents
  $        16.5     $              
                 
Debt:
               
Current portion of long-term debt
  $ 34.8     $    
Long-term debt, less current portion
    109.3          
                 
      144.1          
                 
Stockholders’ Equity2
               
Common Stock, $0.01 par value;
20,000,000 shares authorized,
7,832,4753 shares issued, actual, 6,969,200 shares issued and outstanding, pro forma
    -          
Additional paid-in capital
    0.4          
Retained earnings
    7.2          
                 
      7.6          
                 
      7.6          
                 
Total capitalization
  $ 151.7     $  
                 
 
(1) A $1.00 increase (decrease) in the assumed initial public offering price of $ •  per share would increase (decrease) cash and cash equivalents, additional paid-in-capital, total stockholders’ equity and total capitalization by approximately $ •  million, assuming the number of shares offered by us, as set forth on the cover page of this Prospectus, remains the same and after deducting underwriter discounts and estimated offering expenses payable by us.
 
(2) In connection with the initial public offering of our common stock, we have adopted Amended and Restated Articles of Incorporation. Pursuant to the Amended and Restated Articles of Incorporation, we have 20,000,000 shares of common stock authorized for issuance, par value $0.01 per share.
 
(3) Pro forma adjustment assuming 175 for 1 stock split.


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DILUTION
 
If you invest in our common stock, your investment will be diluted immediately to the extent of the difference between the public offering price per share of our common stock and the pro forma net tangible book value per share of our common stock after this offering. Our pro forma net tangible book value as of • was approximately $ •  million, or $ •  per share of common stock. Pro forma net tangible book value per share represents the amount of our total tangible assets, less our total liabilities, divided by the number of shares of common stock outstanding as of •  after giving effect to an assumed 175 for 1 stock split as if it had occurred prior to April 30, 2011.
 
Net tangible book value dilution per share to new investors represents the difference between the amount per share paid by purchasers of shares of common stock in this offering and the pro forma net tangible book value per share of common stock immediately after the completion of this offering. After giving effect to our sale of shares of common stock in this offering at the initial public offering price of $ •  per share, after deducting the underwriting discounts and commissions and estimated offering expenses payable by us and after giving effect to estimates of certain expenses that we expect to be reimbursed, our pro forma as adjusted net tangible book value as of • would have been $ •  million, or $ •  per share. This represents an immediate increase in net tangible book value of $ •  per share to existing stockholders and an immediate dilution in net tangible book value of $ •  per share to investors purchasing common stock in this offering, as illustrated by the following table:
 
           
Initial public offering price per share
    $                  
Pro forma net tangible book value per share prior to this offering as of •, 2011
    $    
Increase in net tangible book value per share attributable to this offering
    $    
Pro forma net tangible book value per share after this offering
    $    
Dilution in net tangible book value per share to new stockholders
    $  
           
 
The following table summarizes, on the same pro forma basis as of • , the differences between the existing stockholders and the new stockholders in this offering with respect to the number of shares purchased from us, the total consideration paid, and the average price per share paid before deducting the underwriting discounts and commissions and estimated offering expenses payable by us. The calculations, with respect to shares purchased by new investors in this offering, reflect an assumed initial public offering price of $ •  per share, the midpoint of the price range set forth on the front cover page of this Prospectus.
 
                               
                              Average Price 
      Shares Purchased     Total Consideration     Per Share
      Number     Percent     Amount     Percent      
Existing stockholders
                             
                               
New investors
                             
                               
Total
                             
                               
 
The number of shares of common stock outstanding in the table above is based on the pro forma number of shares outstanding as of •  which assumes no exercise of the underwriters’ over-allotment option. If the underwriters’ over-allotment option is exercised in full, the number of shares of common stock held by existing stockholders will be reduced to • % of the total number of shares of common stock to be outstanding after this offering, and the number of shares of common stock held by investors participating in this offering will be increased to •  shares or • % of the total number of shares of common stock to be outstanding after this offering.


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SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA
 
Effective with the fiscal year ended April 30, 2007, we changed our fiscal year end from March 31 to April 30. As a result, our fiscal year ended April 30, 2007 consists of 13 months. The following tables set forth our selected historical consolidated financial data for the fiscal years ended April 30, 2011, 2010, 2009 and 2008 and the fiscal period ended April 30, 2007. The selected historical financial data for the fiscal years ended April 30, 2011, 2010, 2009 and 2008 and the selected consolidated balance sheet data as of April 30, 2011 and 2010 has been derived from our audited consolidated financial statements included elsewhere in this Prospectus. The selected historical financial data for the fiscal period ended April 30, 2007 and the selected consolidated balance sheet data as of April 30, 2007 has been derived from our audited consolidated financial statements not included in this Prospectus, which, in the opinion of management, include all adjustments, consisting only of usual recurring adjustments, necessary for fair presentation of such data.
 
The following table should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the financial statements included elsewhere in this Prospectus.
 
The data presented below are in thousands, except for diluted net income per share attributed to Peak Resorts, Inc. and the effective ticket price (“ETP”) amounts.
 
                                                         
                            (Unaudited)        
                            Twelve
             
    Year Ended     Months
          Period Ended
 
    April 30,     Ended
    April 30,
    April 30,
 
    2011(1)     2010     2009     2008     April 30, 2007     2006     2007(1)(2)  
 
                                                         
Revenues
    $97,586       $89,846       $84,293       $84,817       $49,668       $40       $49,708  
Operating expense
    70,815       66,672       65,745       70,787       37,228       1,063       38,291  
Depreciation and amortization
    8,054       7,545       6,813       6,478       3,876       273       4,149  
Land and building rent
    1,948       1,858       1,835       1,815       1,595       124       1,719  
Interest expense, net
    11,338       11,370       10,818       9,510       4,230       168       4,398  
Gain on sale/leaseback
    333       333       333       333       333       28       361  
Gain on acquisition
    400                                      
Other (expense)
                (176 )                        
Investment income
    240       98       269       323       119       6       125  
Income (loss) before income taxes(3)
    6,404       2,833       (492 )     (3,117 )     3,191       (1,554 )     1,637  
Net income (loss)(4)
    $(4,006 )     $2,833       $(492 )     $(3,117 )     6,920       (1,554 )     $5,366  
Basic and diluted earnings (loss) per share
    $(100.59 )     $71.14       $(12.36 )     $(78.27 )     173.75       (39.02 )     $134.73  
Other Data:
                                                       
Operations:
                                                       
Skier visits(5)
    1,752       1,669       1,543       1,628       1,349             1,349  
ETP(6)
    $29.07       $27.82       $28.16       $26.38       $27.46       N/A       $27.46  
Other Balance Sheet Data:
                                                       
Cash and cash equivalents(7)
    $16,463       $19,508       $10,937       $11,233       N/A       N/A       $9,498  
Total assets
    $180,521       $170,254       $161,088       $152,984       N/A       N/A       $136,300  
Long-term debt and capitalized lease obligations (including long-term debt due within one year)
    $144,058       $138,621       $134,856       $124,978       N/A       N/A       $104,934  
Net debt(8)
    $127,595       $119,113       $123,919       $113,746       N/A       N/A       $95,436  
Total stockholders’ equity
    $7,578       $13,733       $11,109       $11,889       N/A       N/A       $15,099  
 
(1) We made three acquisitions which impact the comparability from fiscal year 2007 through fiscal year 2011. During the period ended April 30, 2007, we acquired Mount Snow, Ltd. (Mount Snow Ski Resort) and L.B.O. Holding, Inc. (Attitash Ski Resort). Effective October 20, 2010, we acquired substantially all of the


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assets of Wildcat Mountain Ski Area. The results of operations of these acquisitions have been included in our financial statements since the dates of the acquisitions.
(2) We changed our fiscal year end from March 31 to April 30 effective with the fiscal year ended April 30, 2007. The period ended April 30, 2007 is comprised of 13 months.
(3) The Company was an S-corporation for federal and state income tax purposes until April 30, 2011 when it terminated its S-corporation election. As a result we did not have a provision for income taxes, except in fiscal 2007 when we wrote off our deferred income taxes as noted below during the period ended April 30, 2007. The Company revoked its S-corporation election effective April 30, 2011. In connection with the revocation, deferred income taxes were reinstated for the tax effect of temporary differences.
(4) The deferred income taxes recorded by Mount Snow, Ltd. and L.B.O Holding, Inc. were written off when they were approved as qualified S-corporations.
(5) A skier visit represents a person utilizing a ticket or pass to access a mountain resort for any part of one day and includes both paid and complimentary access.
(6) ETP is calculated by dividing lift ticket revenue by total skier visits during the respective periods.
(7) Cash and cash equivalents excludes restricted cash.
(8) Net debt is defined as long-term debt and capital lease obligations plus long-term debt and capital lease obligations due within one year less cash and cash equivalents.


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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 should be read in conjunction with the consolidated financial statements and notes related thereto included with this Prospectus. To the extent that the following Management’s Discussion and Analysis contains statements which are not of a historical nature, such statements involve risks and uncertainties. These risks include, but are not limited to, those discussed in the “Risk Factors” section on page 7 of this Prospectus. The following discussion and analysis should be read in conjunction with the Forward-Looking Statements and the risk factors, each included in this Prospectus.
 
Overview
 
We own or lease and operate 12 ski areas throughout the Midwest, Northeast and Southeast United States. Our ski areas, which include both day ski areas and overnight drive ski areas, offer snow skiing, snowboarding and other snow sports to an average of 1.5 million skiers every year.
 
The Company and its subsidiaries operate in a single business segment – ski resort operations. The consolidated financial data for our fiscal years ended April 30, 2010 and 2009 presented in this Prospectus is comprised of the data of 11 of our ski areas, which includes all but Wildcat Mountain, as it was acquired after the end of fiscal 2010. The consolidated financial data for the fiscal year ended April 30, 2011 includes the data for all 12 of our ski areas. Also included in the financial information presented are ancillary services, primarily food and beverage services, ski equipment rental, ski school, hotel/lodging and retail.
 
The opening and closing dates of our ski areas are dependent upon weather conditions, but our peak ski season generally runs from early December to mid-April. The following table illustrates the opening and closing dates for the 2007 through 2011 ski seasons for our 12 ski areas:
 
                         
      2007/2008 Open/Close
    2008/2009 Open/Close
    2009/2010 Open/Close
    2010/2011 Open/Close
Ski Area     Dates     Dates     Dates     Dates
Attitash
    November 18, 2007 /
April 13, 2008
    November 22, 2008 /
March 30, 2009
    December 12, 2009 /
March 28, 2010
    December 11, 2010 /
April 3, 2011
Big Boulder
    November 10, 2007 /
April 13, 2008
    November 21, 2008 /
April 5, 2009
    December 6, 2009 /
April 4, 2009
    November 29, 2010 /
April 10, 2011
Boston Mills
    December 7, 2007 /
March 23, 2008
    December 12, 2008 /
March 14, 2009
    December 12, 2009 /
March 20, 2010
    December 10, 2010 /
March 14, 2011
Brandywine
    December 22, 2007 /
March 16, 2008
    December 20, 2008 /
March 1, 2009
    December 19, 2009 /
March 20, 2010
    December 11, 2010 /
March 13, 2011
Crotched Mountain
    November 30, 2007 /
March 30, 2008
    November 22, 2008 /
March 29, 2009
    December 11, 2009 /
March 28, 2010
    December 4, 2010 /
April 3, 2011
Hidden Valley
    December 26, 2007 /
March 9, 2008
    December 20, 2008 /
March 8, 2009
    December 12, 2009 /
March 7, 2010
    December 18, 2010 /
February 27, 2011
Jack Frost
    December 8, 2007 /
March 23, 2008
    December 13, 2008 /
March 22, 2009
    December 12, 2009 /
March 21, 2010
    December 11, 2010 /
March 13, 2011
Mad River
    December 7, 2007 /
March 23, 2008
    December 12, 2008 /
March 8, 2009
    December 11, 2009 /
March 7, 2010
    December 10, 2010 /
March 6, 2011
Mount Snow
    November 10, 2007 /
April 27, 2008
    November 22, 2008 /
April 19, 2009
    December 7, 2009 /
April 11, 2010
    November 25, 2010 /
April 16, 2011
Paoli Peaks
    December 25, 2007 /
March 9, 2008
    December 20, 2008 /
March 7, 2009
    December 12, 2009 /
March 7, 2010
    December 7, 2010 /
February 27, 2011
Snow Creek
    December 15, 2007 /
March 16, 2008
    December 13, 2008 /
March 8, 2009
    December 12, 2009 /
March 7, 2010
    December 11, 2010 /
March 6, 2011
Wildcat Mountain
    November 30, 2007 /
April 27, 2008
    November 28, 2008 /
April 20, 2009
    December 11, 2009 /
April 19, 2010
    December 11, 2010 /
April 24, 2011
                         


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Our single largest source of revenue is the sale of lift tickets (including season passes) which represented approximately 52% of net revenue for each of fiscal 2011, 2010 and 2009. Lift ticket revenue is driven by the volume of lift tickets and season passes sold and the pricing of these items. Most of our season pass products are sold before the start of the ski season. Season pass revenue, although collected prior to the ski season, is recognized in the consolidated statement of earnings (loss) over the ski season based upon the estimated length of the season. For the 2010/2011, 2009/2010 and 2008/2009 ski seasons, approximately 28.6%, 26.3% and 27.7%, respectively, of total lift revenue recognized was comprised of season pass revenue.
 
The cost structure of our operations has a significant fixed component with variable expenses including, but not limited to, retail and food and beverage cost of sales, labor, power and utilities. As such, profit margins can fluctuate based on the level of revenues.
 
Seasonality and Quarterly Results
 
Our resort operations are seasonal in nature. In particular, revenue and profits for our operations are substantially lower and historically result in losses from late spring to late fall, which occur during our first and second fiscal quarters. Revenue and profits generated by our summer golf operations are not sufficient to fully offset our off-season losses from our operations. During fiscal 2011, approximately 92% of resort revenues were recognized in the third and fourth fiscal quarters. Therefore, the operating results for any interim period are not necessarily indicative of the results that may be achieved for any subsequent quarter or for a full year.
 
Recent Trends
 
Despite the recent economic recession, we experienced improved operating results as a result of price increases and increased skier visits mainly due to our acquisition of Wildcat Mountain Ski Area. Uncertainties still exist surrounding the strength and duration of the general economic climate, and as such, we cannot predict whether our favorable trends will continue and what impact the economy will have on our future operations.
 
The timing and duration of favorable weather can have an impact on our revenues in regards to the timing and number of skier visits. Though the amount of snowfall early in the ski season does encourage skier visits, all of our ski areas have snowmaking capabilities in the event that the natural snowfall is insufficient. Cold weather, however, is essential to a successful ski season. The weather was favorable during the 2010/2011 ski season, but there is no way to predict favorable weather conditions in the future. We sell season passes prior to the start of the ski season to help mitigate any negative effects that unfavorable weather may have on our revenues. For the 2009/2010 and 2010/2011 ski seasons, we have had an increase in the preseason sales of season passes. There can be no assurance that future preseason pass sales will be similar to historical trends.
 
We have increased the prices of most of our lift tickets, passes and certain other products and services in each of the last two seasons. There can be no assurance that we will be able to increase prices in the future or the impact that pricing increases may have on visitation or revenue.
 
Effective October 20, 2010, we acquired Wildcat Mountain Ski Area through the purchase of the assets of Wildcat Mountain Ski Area, Inc., Meadow Green-Wildcat Skilift Corp. and Meadow Green-Wildcat Corp. for a total of approximately $5 million. Wildcat Mountain is located in northern New Hampshire and serves the New Hampshire, Boston, Massachusetts and Rhode Island markets. Wildcat Mountain is located in close proximity to the Attitash ski area and gives our skiers the opportunity to use the same lift tickets and season passes for both Wildcat Mountain and Attitash, thus providing our visitors in this area with more ski choices and opportunities. The results of operations of Wildcat Mountain are included in our consolidated results of operations from the effective date of the acquisition, October 20, 2010, forward. Our acquisition of Wildcat Mountain has not had a significant impact on our overall results of operations.
 
In March 2011, we entered into an agreement to replace Mount Snow’s Summit Local triple chair lift with a new Leitner Poma high-speed detachable six-passenger bubble chair lift. We expect that the new lift will reduce the ride time of the current lift by nearly half. In addition, the new lift’s bubble chairs provide shelter from inclement weather and the convenience of ski-on ski-off loading and unloading.
 
Effective April 30, 2011, we terminated our S-corporation election and are now operating as a C-corporation.


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Results of Operations
 
Summary
 
Our operating results for fiscal 2011, 2010, and fiscal 2009 are presented by category as follows (dollars in thousands):
 
                                         
                      Percent
 
    Year Ended April 30,     Increase/(Decrease)  
    2011     2010     2009     2011/2010     2010/2009  
       
 
Revenue:
                                       
Lift tickets
  $ 50,938     $ 46,419     $ 43,447       9.7 %     6.8 %
Food and beverage
    15,131       14,023       12,870       7.9 %     9.0 %
Rental
    8,147       8,040       6,986       1.3 %     15.1 %
Ski school
    6,868       6,179       5,688       11.2 %     8.6 %
Hotel/lodging
    6,337       5,535       5,682       14.5 %     -2.6 %
Retail
    4,282       4,084       3,897       4.8 %     4.8 %
Other
    5,883       5,565       5,723       5.7 %     -2.8 %
     
     
Total revenue
    97,586       89,845       84,293       8.6 %     6.6 %
Operating expense:
                                       
Labor and labor related expenses
    35,163       33,505       32,924       5.5 %     1.8 %
Retail and food and beverage cost of sales
    7,803       7,205       6,915       8.3 %     4.2 %
Power and utilities
    7,439       6,671       6,872       11.5 %     -2.9 %
Real estate and other taxes
    1,946       1,697       1,829       14.7 %     -7.2 %
General and administrative expense
    2,319       2,403       2,070       -3.5 %     16.1 %
Other expense
    16,145       15,191       15,135       6.3 %     0.4 %
     
     
Total operating expense prior to depreciation and amortization and land and building rent
    70,815       66,672       65,745       6.1 %     1.4 %
     
     
Depreciation and amortization
    8,054       7,544       6,813       6.8 %     10.7 %
Land and building rent
    1,948       1,858       1,835       4.8 %     1.3 %
     
     
Total Operating Expense
    80,817       76,074       74,393       6.2 %     2.3 %
     
     
Operating Income
  $ 16,769     $ 13,771     $ 9,900       21.8 %     39.1 %
   
Total Reported EBITDAR
  $ 26,770     $ 23,175     $ 18,548       15.5 %     24.9 %
   
Total skier visits
    1,752       1,669       1,543       5.0 %     8.1 %
   
 
We have chosen to specifically include Reported EBITDAR (defined as net income before interest, income taxes, depreciation and amortization, gain on sale leaseback, investment income, other income or expense, property rent and other non-recurring items) as a measurement of our results of operations because we consider this measurement to be a significant indication of our financial performance and available capital resources. Reported EBITDAR is not a measure of financial performance under GAAP. We provide a reconciliation of Reported EBITDAR to net income, the most directly-comparable GAAP measurement, below.
 
Management considers Reported EBITDAR to be a significant indication of our financial performance and available capital resources. Because of large depreciation and other charges relating to our ski areas, it is difficult for management to fully and accurately evaluate our financial results and available capital resources using net income. Management believes that by providing investors with Reported EBITDAR, investors will have a clearer understanding of our financial performance and cash flow because Reported EBITDAR: (i) is widely used in the ski industry to measure a company’s operating performance without regard to items excluded from the calculation of such measure, which can vary by company primarily based upon the structure or existence of their financing; (ii) helps investors to more meaningfully evaluate and compare the results of our operations from period to period by removing the effect of our capital structure and asset base from our operating structure; and (iii) is used by our management for various purposes, including as a measure of performance of our operating entities and as a basis for planning. Furthermore, as noted above, Reported EBITDAR excludes land and property rent. Financing costs on land and property that we own are accounted for as interest expense, which is also excluded in Reported EBITDAR. Rent costs associated with the land and property that we lease are not, however, accounted for as interest expense,


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but have the same effect on our operating results as the financing costs on property that we own. As such, we believe that excluding land and property rent from our net income in Reported EBITDAR provides management and investors with a more accurate understanding of our cash flow and results of operations, as noted in this paragraph.
 
Items excluded from Reported EBITDAR are significant components in understanding and assessing financial performance or liquidity. Reported EBITDAR should not be considered in isolation or as 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 Reported EBITDAR is not a measurement determined in accordance with GAAP and is susceptible to varying calculations, Reported EBITDAR as presented may not be comparable to other similarly titled measures of other companies.
 
The following table includes a reconciliation of Reported EBITDAR to net income (loss) (in thousands):
 
                         
    Year Ended April 30,  
    2011     2010     2009  
       
 
Net income (loss)
  $ (4,006 )   $ 2,833     $ (492 )
Income tax provision
    10,410                  
Interest expense, net
    11,338       11,370       10,818  
Depreciation and amortization
    8,054       7,545       6,813  
Land and building rent
    1,948       1,858       1,835  
Investment income
    (241 )     (98 )     (269 )
Gain on sale/leaseback
    (333 )     (333 )     (333 )
Gain on acquisition
    (400 )            
Other
                176  
     
     
Total Reported EBITDAR
  $ 26,770     $ 23,175     $ 18,548  
   
 
Fiscal 2011 Compared to Fiscal 2010
 
Lift revenue increased $4.5 million, or 9.7%, for fiscal 2011 compared to fiscal 2010. The acquisition of Wildcat Mountain accounted for $1.9 million in lift revenue. The balance was due to a $0.7 million, or 2.2%, increase in lift revenue (excluding season passes) and a $1.9 million, or 15.5%, increase in season pass revenue. The increase in season pass revenue was due to an increase in season pass prices along with an increase in the number of season passes sold. We believe that this was attributable to public excitement about snow sports as a result of the 2010 Winter Olympics and favorable weather during the 2010/2011 ski season that allowed us to open our ski areas early and close many of the ski areas later in the season. Total skier visits for fiscal 2011 increased 5.0% compared to fiscal 2010, which was primarily due to the acquisition of Wildcat Mountain. The net change of skier visits without taking into account the Wildcat Mountain acquisition was flat.
 
Food and beverage revenue increased $1.1 million, or 7.9%, for fiscal 2011 compared to fiscal 2010, of which $0.5 million related to Wildcat Mountain, and the balance of the change was primarily due to a 4.1% increase in yield per skier visit. Yield is determined by dividing revenue by skier visits.
 
Rental revenue increased $0.1, or 1.3%, for fiscal 2011 compared to fiscal 2010, which is attributable to the acquisition of Wildcat Mountain.
 
Ski school revenue increased $0.7 million, or 11.2%, for fiscal 2011 compared to fiscal 2010, of which $0.3 million was related to Wildcat Mountain, while the rest is attributable to an increase in private lessons sold, which generates increased yield.
 
Hotel/lodging revenue increased $0.8 million, or 14.5%, for fiscal 2011 compared to fiscal 2010 primarily due to an increase in condominium rental units available for rent in fiscal 2011 as compared to fiscal 2010, an increase in the effective rate realized at Mount Snow’s Snow Lake Lodge as a result of the completion of a large refurbishment project and an increase in bookings for special events, including weddings.
 
Retail revenue increased $0.2 million, or 4.8%, for fiscal 2011 compared to fiscal 2010, which is attributable to the acquisition of Wildcat Mountain.


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Labor and related benefit expense increased by $1.7 million, or 5.0%, for fiscal 2011 compared to fiscal 2010, $1.2 million of which is attributable to the acquisition of Wildcat Mountain. The remaining difference is due to net increases in seasonal labor costs at our ski areas.
 
Retail and food and beverage cost of sales increased by $0.6 million for fiscal 2011, or 8.3%, as compared to fiscal 2010, $0.2 of which is attributable to the Wildcat Mountain acquisition. The balance is due to an increase in both food and beverage prices and sales as a result of our ski areas remaining open longer during the 2010/2011 ski season and the acquisition of Wildcat Mountain.
 
Power and utility expense for fiscal 2011 increased by $0.8 million, or 11.5%, as compared to fiscal 2010. Wildcat Mountain accounted for $0.6 million of this increase. The balance is attributable to a longer season at our larger ski areas.
 
Real estate and other taxes increased by $0.2 million, or 11.6%, for fiscal 2011 compared to fiscal 2010, which is attributable to the acquisition of Wildcat Mountain.
 
General and administrative expense for fiscal 2011 decreased by $0.1 million, or 3.5%, as compared to fiscal 2010, primarily because of favorable closeout of retrospective workers’ compensation insurance policies.
 
Other expense increased by $1.0 million, or 6.3%, for fiscal 2011 compared to fiscal 2010, of which $0.9 million is attributable to the acquisition of Wildcat Mountain.
 
Fiscal 2010 Compared to Fiscal 2009
 
Lift revenue increased $3.0 million, or 6.8%, for fiscal 2010 compared to fiscal 2009, due to a $2.8 million, or 6.4%, increase in lift revenue (excluding season passes) and a $0.2 million, or 0.4%, increase in season pass revenue. The increase in season pass revenue was due to an increase in season pass prices offset by a decrease in the number of season passes sold. Total skier visits for fiscal 2010 increased 8.1% compared to fiscal 2009 led by our day ski areas, which experienced a 20.1% increase, offset by a 1.4% decrease in skier visits to our overnight drive ski areas. Our day ski areas experienced increased skier visits during fiscal 2010 because of cold temperatures through mid-February. Our overnight drive ski areas experienced a decrease in skier visits during fiscal 2010 principally because of lower than normal snowfall.
 
Food and beverage revenue increased $1.2 million, or 9.0%, for fiscal 2010 compared to fiscal 2009, primarily due to increased skier visits and a 0.8% increase in yield per skier visit.
 
Rental revenue increased $1.1 million, or 15.1%, for fiscal 2010 compared to fiscal 2009, primarily due to increased skier visits and a 6.4% increase in yield per skier visit.
 
Ski school revenue increased $0.5 million, or 8.6%, for fiscal 2010 compared to fiscal 2009, primarily due to increased skier visits, while the yield per skier visit remained unchanged.
 
Hotel/lodging revenue decreased by $0.1 million, or 2.6%, for fiscal 2010 compared to fiscal 2009 primarily due to a 9.9% decrease in yield per skier visit and a decrease in occupancy. We experienced the decrease in occupancy mainly during the off-season months, with revenues decreasing by 6.3%. Bookings of groups and corporate business decreased because of the economic recession.
 
Retail revenue increased $0.2 million, or 4.8%, for fiscal 2010 compared to fiscal 2009, primarily due to increased skier visits, offset by a 3.1% decrease in yield per skier visit.
 
Labor and related benefit expense increased by $0.6 million, or 1.8%, for fiscal 2010 compared to fiscal 2009 primarily because of bonuses awarded to employees and an employer’s contribution to the Company’s 401(k) retirement plan in fiscal 2010 applicable to employees at our resorts. Neither bonuses nor a 401(k) match were paid in fiscal 2009 as part of our efforts to conserve cash because of the uncertain economic climate.
 
Retail and food and beverage cost of sales increased by $0.3 million for fiscal 2010, or 4.2%, as compared to fiscal 2009 primarily because of the corresponding increase in revenue and skier visits.


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Power and utility expense for fiscal 2010 decreased by $0.2 million, or 2.9%, as compared to fiscal 2009. The ski season weather during fiscal 2010 was favorable, and as a result of more snowfall, we had fewer snowmaking hours and used less power. This was offset by a utility rate structure change in Pennsylvania.
 
Real estate and other taxes decreased by $0.1 million, or 7.2%, for fiscal 2010 compared to fiscal 2009 primarily because fiscal 2009 included the payment of a $0.2 million settlement with the state of Vermont regarding a miscalculation of sales tax due.
 
General and administrative expense for fiscal 2010 increased by $0.3 million, or 16.1%, as compared to fiscal 2009 primarily because of bonuses awarded to employees and an employer’s contribution to the Company’s 401(k) retirement plan in fiscal 2010 at the Peak Resorts, Inc. level. Neither bonuses nor a 401(k) match were paid in fiscal 2009 as part of our efforts to conserve cash because of the uncertain economic climate.
 
Other Expenses
 
The following table illustrates our other expenses during the three-year period ended April 30, 2011 (in thousands):
 
                                         
    Year ended April 30,     Increase (decrease)  
    2011     2010     2009     2011/2010     2010/2009  
 
Depreciation and amortization
  $ 8,054     $ 7,544     $ 6,813     $ 510     $ 731  
Investment income
    240       98       269       142       (171 )
Interest expense, net
    11,338       11,370       10,818       (32 )     552  
Land and building rent
    1,948       1,858       1,835       90       23  
Gain on acquisition
    400                   400        
 
In addition to operating results, the following material items contribute to our overall financial performance.
 
Depreciation and amortization.  Depreciation and amortization expense for fiscal 2011 and 2010 increased due to the acquisition of Wildcat Mountain, the addition of a new equipment rental building at Snow Creek, the installation of a new tube park at Hidden Valley and the full year impact of an increase in the fixed asset base from placing in service resort assets in several of our resorts. Depreciation and amortization expense for fiscal 2009 increased primarily due to the full year impact of an increase in the fixed asset base from placing in service significant resort assets, primarily at Mount Snow and Attitash. This includes the installation of a significant amount of snowmaking equipment. The increase in depreciation was offset by savings in electricity and diesel fuel as a result of the snowmaking equipment update.
 
Investment income.  The increase in investment income for fiscal 2011 compared to fiscal 2010 is primarily due to a realized gain on the sale of available-for-sale securities of $0.2 million. The decrease in investment income for fiscal 2010 compared to fiscal 2009 is primarily due to a reduction in average interest rates and a realized investment gain of $0.1 million in fiscal 2009.
 
Interest expense, net.  Interest expense for fiscal 2011 remained relatively consistent with interest expense for fiscal 2010. The increase in interest expense for fiscal 2010 compared to fiscal 2009 is primarily due to an increase in interest rates on the debt with EPT as provided for in the loan agreements which are more fully discussed below.
 
Liquidity and Capital Resources
 
Significant Sources of Cash
 
Our available cash is the highest in our fourth quarter primarily due to the seasonality of our resort business. We had $16.5 million of cash and cash equivalents at April 30, 2011 compared to $19.5 million as of April 30, 2010. We generated $12.2 million of cash from operating activities during fiscal 2011 compared to $13.9 million in fiscal 2010. We generate the majority of our cash from operations during the ski season, which occurs in our third and fourth quarters. We currently anticipate that Reported EBITDAR will continue to provide a significant source of our future operating cash flows.


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In addition to our $16.5 million of cash and cash equivalents at April 30, 2011, we have available $28.3 million under various loan agreements to fund expansion and capital expenditures at our ski areas. We expect that our liquidity needs for the near term and the next fiscal year will be met by continued use of operating cash flows (primarily those generated in our third and fourth fiscal quarters) and additional borrowings under our loan arrangements, as needed.
 
Long-term debt at April 30, 2011 and 2010 consisted of borrowings pursuant to the loans and other credit facilities discussed below, as follows:
 
                 
    2011     2010  
 
Attitash/Mount Snow Debt, payable in monthly interest-only payments at an increasing interest rate (10.46% and 10.16% at April 30, 2011 and 2010, respectively), remaining principal and interest due on April 3, 2027
  $ 62,500,000     $ 62,500,000  
Mount Snow Development Debt, payable in monthly interest-only payments at 10.00%, remaining principal and interest due on April 1, 2012
    33,676,700       33,676,700  
Credit Facility Debt, payable in monthly interest-only payments at an increasing interest rate (9.54% and 9.40% at April 30, 2011 and 2010, respectively), remaining principal and interest due on October 29, 2027
    32,232,800       32,232,800  
Crotched Mountain Debt, payable in monthly interest-only payments at an increasing interest rate (9.82% and 9.67% at April 30, 2011 and 2010, respectively), remaining principal and interest due on March 10, 2027
    8,000,000       8,000,000  
Wildcat Mountain Debt, payable in monthly installments of $27,300, including interest at a rate of 4.00%, with remaining principal and interest due on December 22, 2020
    4,438,200        
Other debt
    847,600       292,200  
     
     
 
      141,695,300       136,701,700  
Less: current maturities
    34,071,300       93,500  
     
     
 
      $  107,624,000       $  136,608,200  
     
     
 
 
The Attitash/Mount Snow Debt due April 3, 2027 in the foregoing table represents amounts borrowed by the Company as follows:
 
  •   $15.7 million borrowed pursuant to a Loan Agreement entered into by and between the Company, as borrower, and EPT Mount Attitash, Inc., as lender, dated as of April 4, 2007, as evidenced by a promissory note in the amount of $15.7 million dated as of April 4, 2007 and modified on October 30, 2007 (collectively, the “Attitash Loan Documents”); and
 
  •   $59.0 million borrowed pursuant to a Loan Agreement entered into by and between the Company, as borrower, and EPT Mount Snow, Inc., as lender, dated as of April 4, 2007, as modified by the First Modification Agreement by and between such parties, dated as of June 30, 2009 (the “Mount Snow First Modification Agreement”), as evidenced by an amended and restated promissory note in the amount of $59.0 million, dated as of June 30, 2009 (collectively, the “Mount Snow Loan Documents”).
 
The Company entered into the Attitash Loan Documents and Mount Snow Loan Documents in connection with the 2007 acquisitions of Attitash and Mount Snow. In addition to the funds borrowed on the date of the acquisitions, the Attitash Loan Documents and the Mount Snow Loan Documents provided for $25.0 million of additional borrowing capacity as of the date of the acquisitions to be drawn to fund improvements and capital expenditures at Attitash and Mount Snow, subject to the approval of the lender. At April 30, 2011, $11.0 million remained to fund approved capital expenditures and improvements in future years.
 
The $59.0 million borrowed pursuant to the Mount Snow Loan Documents includes $1.2 million of additional funds available under the Mount Snow First Modification Agreement to be used for purposes stipulated


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by such agreement or other purposes as approved by the lender. No borrowings have been made under this arrangement.
 
Commencing April 1, 2008 and each April 1st thereafter, the interest rates relating to the debt outstanding under the Attitash Loan Documents and Mount Snow Loan Documents will increase from the prior interest rate measurement date by the lesser of three times the percentage increase in the Consumer Price Index (“CPI”) or a factor of 1.015 (the “Capped CPI Index”) unless specified debt service coverage ratios are maintained for a period of two consecutive years. If the target debt service coverage ratios are attained and maintained, the interest rate will be 100 basis points lower than it otherwise would have been. For the years ended April 30, 2011, 2010 and 2009, we have not maintained the specified debt service coverage ratios, and therefore, our interest rates have increased. We continue to work on meeting these ratios in order to stabilize interest rates in the future. The table below illustrates the range of potential interest rates for each of the next five years assuming rates are to increase by the Capped CPI Index annually:
 
                 
Attitash/Mount Snow Debt    
Rate Effective at
  Specific Debt Service Coverage
April 1:
  Attained   Not Attained
 
2011
    9.46 %     10.46 %
2012
    9.61 %     10.61 %
2013
    9.77 %     10.77 %
2014
    9.93 %     10.93 %
2015
    10.09 %     11.09 %
 
The Capped CPI Index is an embedded derivative, but the Company has concluded that the derivative does not require bifurcation and separate presentation at fair value because the Capped CPI Index was determined to be clearly and closely related to the debt instrument.
 
The Attitash Loan Documents and the Mount Snow Loan Documents provide for additional interest payments under certain circumstances. Specifically, if the gross receipts of the respective property during any fiscal year exceed an amount determined by dividing the amount of interest otherwise due during that period by 12%, an additional interest payment equal to 12% of such excess is required. Similar to the minimum required interest payments as described above, the parties have agreed that if specific target debt service coverage ratios are achieved for two consecutive years and are maintained, the interest rate used in determining both the amount of the excess gross receipts and the rate applied thereto would be reduced to 11%. No additional interest payments were due for the years ended April 30, 2011, 2010 or 2009.
 
The Mount Snow Development Debt due April 1, 2012 represents obligations incurred to provide financing for the acquisition of land at Mount Snow that is in development stages. On April 4, 2007, the Company and Mount Snow, Ltd., as borrowers, entered into a promissory note in favor of EPT Mount Snow, Inc., as lender, in the amount of $25.0 million, which was later modified by the Modification Agreement dated as of April 1, 2010 to increase the amount of funds available to $41.0 million (the “Mount Snow Development Loan Documents”). Principal payments are required to be made from all proceeds from any sale of development land at Mount Snow with any remaining principal due at maturity. The Mount Snow Development Loan Documents require, commencing May 1, 2010, monthly payments of interest arising after April 1, 2010. The increased amount available under the Mount Snow Development Loan Documents includes accrued interest to the effective date of the modification of approximately $8.7 million and, accordingly, approximately $7.3 million was available for development purposes at April 30, 2011.
 
The Credit Facility Debt due October 29, 2027 represents amounts due pursuant to the Amended and Restated Credit and Security Agreement, dated as of October 30, 2007, among the Company and certain of its affiliates, as borrowers, and EPT Ski Properties, Inc., as lender (the “Credit Facility Agreement”). In connection with entry into the Credit Facility Agreement, the borrowers executed an amended and restated promissory note, dated as of October 30, 2007, in the amount of $31.0 million, which was later modified by as second amended and restated promissory note, dated as of August 5, 2008, which increased the amount of funds available to $41 million (together with the Credit Facility Agreement, the “Credit Facility Documents”). At April 30, 2011, approximately


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$8.7 million remained available for approved capital expenditures. The interest rate for borrowings under the Credit Facility Documents increases each October 1 during the term of the Credit Facility Documents, such increase to be the lesser of two times the increase in the CPI or Capped CPI Index.
 
The Crotched Mountain Debt due March 10, 2027 noted in the table above represents amounts due to EPT Crotched Mountain, Inc. pursuant to a promissory note made by SNH Development, Inc., the Company’s wholly owned subsidiary. The promissory note, dated as of March 10, 2006 (the “Crotched Mountain Note”), was made in the principal amount of $8.0 million, the proceeds of which were used to pay off all outstanding debt secured by our Crotched Mountain ski area and for general working capital purposes. The interest rate applicable to the outstanding debt under the Crotched Mountain Note increases each April 1 during the term of the Crotched Mountain Note, such increase to be the lesser of the rate of interest in the previous year multiplied by the Capped CPI Index or the sum of the rate of interest in the previous year plus the product of (x) the rate of interest in the previous year and (y) the percentage increase in the CPI from the CPI in effect on April 1 of the current year over the CPI in effect on the April 1 of the immediately preceding year.
 
The table below illustrates the potential interest rates applicable to the Company’s fluctuating interest rate debt for each of the next five years, assuming rates increase by the Capped CPI Index:
 
                 
April 1:   Credit Facility Debt   Crotched Mountain Debt
 
2011
    9.54 %     9.82 %
2012
    9.68 %     9.96 %
2013
    9.83 %     10.11 %
2014
    9.98 %     10.26 %
2015
    10.13 %     10.42 %
 
The Wildcat Mountain Debt due December 22, 2020 represents amounts owed pursuant to a promissory note in the principal amount of $4.5 million made by WC Acquisition Corp. in favor of Wildcat Mountain Ski Area, Inc., Meadow Green — Wildcat Skilift Corp. and Meadow Green — Wildcat Corp., (the “Wildcat Note”). The Wildcat Note, dated November 22, 2010, was made in connection with the acquisition of Wildcat Mountain, which was effective as of October 20, 2010. The interest rate as set forth in the Wildcat Note is fixed at 4.00%.
 
Substantially all of the Company’s assets serve as collateral for our long-term debt.
 
We intend to use approximately $ •  million of the net proceeds from this offering for repayment of a portion of the outstanding debt relating to the development of our Mount Snow ski area. The agreements entered into in connection with the Mount Snow Development Debt do not provide for additional borrowing capacity as we pay down the principal and interest due. As such, the repayment of this debt will not result in additional borrowing capacity under these credit facilities but may create available collateral for future borrowing, if necessary.
 
Fiscal 2011 Compared to Fiscal 2010
 
We generated $12.2 million of cash from operating activities in fiscal 2011, a decrease of $1.7 million when compared to the $13.9 million of cash generated in fiscal 2010. The decrease in operating cash flows was primarily a result of a decrease in deferred revenue from fiscal 2010 to fiscal 2011 due to the change in the deadline to purchase advance season passes at Attitash, Crotched Mountain and Mount Snow from April 30 to June 1 implemented during fiscal 2011. In our experience, our customers generally purchase their advance season passes close to the purchase deadline. As such, the cash collections from advance season pass sales after April 30, 2011 are not included in fiscal 2011 operating results. As of June 1, 2011, advance season pass sales were $6.7 million compared to $6.4 million at June 1, 2010. Advanced season pass sales are complete at all of our ski areas by June 1 each year.
 
Cash used in investing activities increased by $8.8 million in fiscal 2011 compared to fiscal 2010 due to an increase in capital expenditures of $6.2 million, along with a $2.9 million increase of cash used on the development of the land at Mount Snow.


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Cash used in financing activities increased by $1.2 million for fiscal 2011 compared to fiscal 2010 primarily due the need to distribute money to the stockholders to pay taxes incurred before the Company filed the C-Corp election.
 
Fiscal 2010 Compared to Fiscal 2009
 
We generated $13.9 million of cash from operating activities in fiscal 2010, an increase of $7.9 million when compared to the $6 million of cash generated in fiscal 2009. The increase in operating cash flows was primarily a result of improved operations, an increase in sales of season passes of $2.1 million for fiscal 2010 and an increase of $2.0 million in accrued expenses, of which $1.0 million was related to salaries, wages and related benefits with the reinstatement of bonuses and the 401(k) contribution.
 
Cash used in investing activities decreased by $7.3 million in fiscal 2010 compared to fiscal 2009 due to a decrease in capital expenditures of $6.2 million, partially offset by the cash used on the development of the Mount Snow master plan.
 
Cash used in financing activities increased by $6.3 million for fiscal 2010 compared to fiscal 2009 primarily due to the borrowings on long-term debt made in fiscal 2009.
 
Significant Uses of Cash
 
Our cash uses currently include operating expenditures and capital expenditures for assets to be used in operations. We have historically invested significant cash in capital expenditures for our resort operations and expect to continue to invest in the future. Significant investments made in fiscal 2009 and fiscal 2008 for improvements at Attitash, Mount Snow and Brandywine are not of a recurring nature, such as substantial upgrades of snowmaking and development of tube parks. Current capital expenditure levels will primarily include investments that allow us to maintain our high quality standards, as well as certain incremental discretionary improvements at our resorts. Resort capital expenditures for fiscal 2011 were approximately $19 million. We currently anticipate we will spend approximately $4.0 to $5.5 million on resort capital expenditures for fiscal 2012. Included in these capital expenditures are approximately $2.0 to $3.0 million which are necessary to maintain the appearance and level of service appropriate to our resort operations, including routine replacement of our snow grooming equipment and rental fleet equipment. In addition to these estimates is $7.3 million that has already been committed for the installation of the new six pack chair lift at Mount Snow. Discretionary expenditures for fiscal 2012 include replacing diesel generators at Wildcat Mountain and the completion of a new maintenance building at Hidden Valley. We currently plan to use cash on hand, available borrowings under our loan arrangements and/or cash flow generated from future operations to provide the cash necessary to execute our capital plans and believe that these sources of cash will be adequate to meet our needs.
 
Although we have no significant third party commitments currently outstanding, we may incur substantial costs for our ongoing Mount Snow development, subject to obtaining required permits and approvals. We plan to finance any future development activity through operating cash reserves, initial condominium deposits and bridge loans, which would be paid upon project completion mostly through the receipt of remaining committed condominium unit sales.
 
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, capital lease agreements, construction contracts and operating lease agreements. Debt agreements and capital lease obligations are recognized as liabilities in our consolidated balance sheet as of April 30, 2011. Obligations under construction contracts are not recorded as liabilities in our consolidated balance sheet until the goods and/or services are received, in accordance with GAAP. Additionally, operating lease agreements, which totaled $42.5 million as of April 30, 2011, are not recognized as liabilities in our


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consolidated balance sheet, in accordance with GAAP. A summary of our contractual obligations as of April 30, 2011 is as follows (in thousands):
 
                                         
    Payments Due by Period  
          Fiscal
    2-3
    4-5
    More than
 
 Contractual Obligations   Total     2012     years     years     5 years  
   
 
Long-term debt
  $ 141,695     $ 34,071     $ 909     $ 371     $ 106,344  
Capitalized lease obligations including interest
    2,620       820       1,465       335       -  
Operating leases
    42,484       2,468       4,130       3,996       31,891  
Interest on long-term debt
    194,839       14,125       21,813       22,271       136,630  
     
     
    $ 381,638     $ 51,484     $ 28,317     $ 26,973     $ 274,865  
   
 
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, expense, 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 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.
 
Income Taxes
 
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. 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 tax benefit as the largest amount that is more 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, 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 contains uncertainty because management must use judgment to estimate the potential exposure associated with our various filing positions.


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Effect if Actual Results Differ From Assumptions
 
Although we believe the estimates and judgments discussed herein are reasonable and we have adequate reserves for our tax contingencies, actual results could differ, and we may be exposed to increases or decreases in those reserves and tax provisions that could be material.
 
An unfavorable tax settlement could require the use of cash and could possibly result in an increased tax expense and effective tax rate 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, deferred tax liabilities or intangible assets 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 case the remaining book value would be written-off or we could incur costs to remove or dispose of such assets no longer in use.
 
Judgments and Uncertainties
 
The estimate 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 $0.9 million for fiscal 2011.
 
Long-lived Asset Impairment Evaluation
 
Description
 
We evaluate our long-lived assets, including property, equipment and land held for development, for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. If circumstances require a long-lived asset to be tested for possible impairment, we compare undiscounted cash flows expected to be generated by the asset to its carrying value. If the carrying value exceeds the expected undiscounted cash flow, an impairment adjustment would be made to reduce the carrying value of the asset to its fair value. Fair value is determined by application of valuation techniques, including discounted cash flow models, and independent appraisals, if considered necessary.
 
Judgments and Uncertainties
 
The determination of whether the carrying value is recoverable requires management to determine if events have occurred which could indicate such carrying values could be impaired. Any evaluation of impairment would require management to use its judgment regarding the estimated future cash flows generated by such assets.
 
Effects if Actual Results Differ From Assumptions
 
We believe there have been no events warranting evaluation of long-lived assets for impairment. If these assumptions are not correct, this could impact the carrying value of our long-lived assets if the undiscounted cash flows are less than the carrying value. If the undiscounted cash flows are less than the carrying value, an impairment would be recorded to the extent the fair value of such assets is less than their carrying value. The estimate of fair


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value would be a judgment made by management regarding future cash flows that could differ, possibly materially, from actual results.
 
New Accounting Standards
 
Refer to Note 1, Summary of Significant Accounting Policies, of the notes to consolidated financial statements for the years ended April 30, 2011, 2010 and 2009 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.
 
Quantitative and Qualitative Disclosures About Market Risk
 
As of April 30, 2011, we had $141,695,200 in total debt owed to our lenders, EPT and its affiliates. Of the total debt, $38,962,400 million has a fixed rate and, therefore, is not subject to interest rate risk. The interest rate on the remaining $102,732,809 is subject to fluctuation, but the interest rate can only be increased by a maximum of 1.5% annually. At 1.5%, the interest expense on the variable rate outstanding debt is $1,540,992. If interest rates increased 1%, the additional interest cost to the Company would be approximately $1,027,328 for one year. We do not perform any interest rate hedging activities related to this debt.
 
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
 
Maher & Company PC previously audited the Company’s financial statements from fiscal 1998 through the fiscal year ended April 30, 2010. On January 13, 2011, in connection with this offering, the Company’s board of directors terminated the engagement of Maher & Company PC because it is not registered with the Public Company Accounting Oversight Board, a requirement of auditors issuing reports in connection with SEC filings.
 
Also on January 13, 2011, the Company’s board of directors engaged McGladrey & Pullen, LLP as the Company’s independent registered public accounting firm for the fiscal year ending April 30, 2011 and for the purposes of issuing a report on the fiscal year 2011, 2010 and 2009 financial statements filed as a part of this registration statement. During the Company’s two most recent fiscal years and subsequent interim periods, the Company did not consult with McGladrey & Pullen, LLP with respect to any of the matters or reportable events set forth in Item 304(a)(2)(i) and (ii) of Regulation S-K.
 
The reports of Maher & Company PC for the fiscal years ended April 30, 2010 and 2009 do not contain an adverse opinion or a disclaimer of opinion, and are not qualified or modified as to uncertainty, audit scope or accounting principles.
 
During the fiscal years ended April 30, 2010 and 2009, and through January 13, 2011, there were no disagreements between the Company and Maher & Company PC on any matter of accounting principles or practices, financial statements disclosure, or auditing scope or procedure which disagreements, if not resolved to the satisfaction of Maher & Company PC, would have caused Maher & Company PC to make reference thereto in the firm’s reports on the Company’s financial statements for such periods. In addition, no reportable events, as defined in Item 304 (a)(1)(v) of Regulation S-K, occurred during the Company’s two most recent fiscal years.
 
The Company has provided Maher & Company PC with a copy of the foregoing disclosure and has requested that Maher & Company PC furnish the Company with a letter addressed to the SEC stating whether or not Maher & Company PC agrees with the above statements and, if not, stating the respects in which it does not agree. A copy of the letter from Maher & Company PC is filed as an exhibit to the registration statement of which this Prospectus is a part.


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BUSINESS
 
General
 
We are a leader and innovator in the ski industry with 12 ski resorts throughout the United States. Our resorts, located in geographically diverse areas, appeal to a wide range of visitors. All of our properties employ snowmaking capability on a majority of their terrain, and all offer terrain parks for snowboarding and other alternative snow sports in addition to skiing.
 
(PERFORMANCE GRAPH)
 
Through both organic growth and acquisitions, we believe that we have created an efficient, focused and highly profitable operation. In the past six ski seasons, our revenues have grown approximately 205%, from $32,045,000 for the fiscal year ended March 31, 2006 to $97,586,100 for the fiscal year ended April 30, 2011. One of the primary ski industry statistics for measuring performance is a “skier visit,” which represents a person utilizing a ticket or pass to access a mountain resort for any part of one day and includes both paid and complimentary access. During the 2010/2011 ski season, total skier visits for all of the United States ski areas were approximately 60.1 million. Combined, our ski areas had approximately 1.7 million skier visits in the 2009/2010 ski season and approximately 1.8 million skier visits in the 2010/2011 ski season, which we believe put us among the top U.S. companies in terms of number of skier visits during these ski seasons.
 
We are also a recognized leader within the alternative snow sports industry. To compensate for the steady decline in baby boom skiers, who are traditionally downhill skiers, the ski industry began to shift its focus to snowboarding and snow tubing during the 1990s in order to attract the younger skier population. This trend is easier for day and overnight drive ski areas to incorporate and is more likely to interest a novice participant who may be more likely to visit these ski areas than an overnight fly destination ski area. Because of our snowmaking abilities, we have been able to create terrain parks with rails, jumps and pipes and other snow sport amenities that have won us


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industry recognition. Transworld Snowboarding magazine named both Mount Snow’s Carinthia terrain park and Big Boulder’s terrain park in the top five east coast parks for 2011.
 
As an operator of multiple regional and metropolitan ski resorts with a proven history of successful business integration, we believe we are uniquely poised for growth through additional acquisitions. Unlike large destination resort operators that are inhibited in their ability to grow due to a limited number of existing resorts and available mountain space, a portion of our business operates in the niche market of smaller, more metropolitan day ski areas. We have the ability to efficiently operate multiple resorts, as well as the access to funding and the specialized institutional knowledge that will enable us to expand our Company both within our existing markets and new U.S. locations.
 
While a handful of key participants in the day ski area sector operate multiple locations, single-property operators still populate the vast majority of the day ski property owners. Now with six Midwestern, four Northeastern and two Southeastern locations in operation, we operate more ski resorts than any other company in the United States.
 
To the extent available to us, we have included information and other results from our operations during our 2010/2011 ski season. However, we have not included the same information for the United States ski industry as a whole, as final surveys and other reports on the 2010/2011 ski season are not yet available.
 
Ski Industry
 
The United States ski market is estimated to represent approximately 59.8 million skier visits in the 2009/2010 ski season. The National Ski Areas Association Kottke National End of Season Survey reported that there were 471 ski areas operating during the 2009/2010 ski season in the United States. Given the consistency and strength of annual skier visits over a substantial time period and the recovering economy, we believe that participation will remain strong in the coming seasons.
 
As noted above, an important measure of ski resort industry performance is the skier visit. Based on the Preliminary Kottke End of Season Report for the 2010/2011 ski season, the United States achieved approximately 60.1 million skier visits, which is the second highest U.S. total ever reported, despite the lingering effects of the global economic downturn. The three years with the highest number of skier visits in the United States have occurred in the past five completed ski seasons. The chart below illustrates the number of skier visits to U.S. ski resorts, industry-wide, during the past ten completed ski seasons.
 
Total US Ski Resort Visits (millions)
 
(PERFORMANCE GRAPH)
 
 
Source: National Ski Areas Association: Kottke Report


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The following chart shows the aggregate number of skier visits to our 12 ski areas during the past five completed ski seasons.
 
Total Ski Visits–Peak Resorts (millions)
 
(PERFORMANCE GRAPH)
 
Calculated on a pro forma basis as if the Company’s current portfolio of 12 resorts was operated by the Company for the periods shown.
 
The ski industry divides ski areas into three distinct categories: overnight fly destination ski areas, overnight drive ski areas and day ski areas. Overnight fly destination ski areas are defined as ski areas which primarily serve skiers who fly or drive considerable distances and stay for multiple nights. Overnight drive ski areas are ski areas which primarily serve skiers from the regional drive market who stay overnight. Day ski areas are those ski areas at which overnight, dining and after-ski facilities are limited, since the areas primarily serve a day skier market.
 
Overnight fly destination ski areas are generally situated in or amidst major mountainous areas and are typically large facilities. These resorts depend, in large part, on long-distance travel by their visitors and on the development of adjacent real estate for housing, hospitality and retail uses.
 
Day ski areas are smaller in size and usually located near metropolitan areas. As an owner and operator of primarily day ski areas and overnight drive ski areas, we focus on selling lift tickets, renting ski equipment, selling ski lessons, selling convenience-oriented food and beverages and capitalizing on the convenience we provide to the targeted local market. We believe that our resorts target a wide cross-section of the skiing public, from beginners who are skiing for the first time to intermediate and advanced skiers who are honing their skills.
 
The sale of lift tickets comprises a large portion of the ski industry revenues. As such, another important measurement of the ski industry’s profitability is the ETP (effective ticket price), which is calculated by dividing ski related lift ticket revenue by total skier visits. The pricing for various lift ticket products is such that single-day or multi-day tickets, which are typically purchased for a holiday or weekend of skiing, generate a higher ETP than season passes or discounted frequency cards.
 
From the 1998/1999 ski season to 2009/2010 ski season, the average ETP of ski resorts in the United States has increased at a compound annual growth rate of 3.2%. Ski resorts in the United States had an average ETP of $35.71 during the 2009/2010 ski season, the third highest within the past ten ski seasons despite the impact of the global economic downturn.


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Average Effective Ticket Price of Ski Resorts in the United States
 
(PERFORMANCE GRAPH)
 
 
Source: National Ski Areas Association: Economic Analysis
 
The average ETP of our 12 ski resorts combined has increased at a compound annual growth rate of 2.48% from the 2005/2006 ski season to the 2009/2010 ski season, which compares to an annual compound growth rate of 3.06% for the industry as a whole, over the same five-year period.
 
Average Effective Ticket Price–Peak Resorts1
 
(PERFORMANCE GRAPH)
 
 
(1) The chart includes data from all of our resorts, except for Wildcat Mountain, for all periods. The data of Wildcat Mountain is included from October 20, 2010, the effective date of acquisition.
 
The ski industry statistics stated in the foregoing sections have been derived from data published by the Kottke National End of Season Survey 2009/2010 and other industry publications, including those of the National Ski Areas Association.
 
History
 
In 1982, Timothy Boyd, president of the Company, developed Hidden Valley, a day ski area near metropolitan St. Louis, Missouri. In 1986, Mr. Boyd developed a second day ski area near Kansas City, Missouri, called Snow Creek. After the development of Hidden Valley and Snow Creek, Mr. Boyd focused on enhancing snowmaking technology for use at the resorts and achieving the highest snowmaking capability per acre of ski-able terrain in the industry.
 
Peak Resorts, Inc. was incorporated in Missouri on September 24, 1997 as a holding company to own, through its wholly-owned subsidiaries, Hidden Valley, Snow Creek and Paoli Peaks, a third day ski area near Louisville, Kentucky acquired by the Company in 1997. Since Peak was formed, the Company has acquired nine additional ski areas, bringing the total number of resorts owned or leased and operated by the Company to twelve. Eight of these acquisitions occurred after Stephen Mueller and Richard Deutsch joined the Company. We believe that the addition of Messrs. Mueller and Deutsch and their skill sets relating to executing successful acquisitions and managing multiple operations, combined with Mr. Boyd’s unique knowledge of the ski industry and snowmaking, enabled the Company to become the industry leader it is today.


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Effective February 16, 2007, we acquired all of the outstanding common stock of Mount Snow Ltd. and L.B.O. Holding, Inc. from American Skiing Company for an aggregate purchase price of approximately $73.5 million. Mount Snow Ltd. owns and operates the Mount Snow ski resort, adjacent hotels, a golf course and parcels of land that offer development opportunities, all of which are located in West Dover and Wilmington, Vermont. L.B.O. Holding, Inc. is the owner-operator of the Attitash resort in the Mount Washington Valley area of New Hampshire, as well as a hotel and conference center. We believe that the acquisitions of the Mount Snow and Attitash ski resorts provide us with additional penetration of the heavily populated New York and New England regions and incremental revenue sources from non-ski season activities. Additionally, the locations of the resorts provide enhanced geographical diversity to the Company’s resorts, thereby lessening the impact of adverse regional weather patterns on consolidated operating results and, as equipment is upgraded, allowing us to further leverage our snowmaking abilities.
 
In October 2010, we acquired Wildcat Mountain Ski Area through the purchase of the assets of Wildcat Mountain Ski Area, Inc., Meadow Green-Wildcat Skilift Corp. and Meadow Green-Wildcat Corp. for a total of approximately $5 million. Wildcat Mountain is located in northern New Hampshire and serves the New Hampshire, Boston, Massachusetts and Rhode Island markets. Wildcat Mountain is located within 10 miles of the Attitash ski area and gives our skiers the opportunity to use the same lift tickets and season passes for both Wildcat Mountain and Attitash, thus providing our visitors with more ski choices and opportunities.
 
Resorts
 
Our ski properties are located throughout the Midwest, Northeast and Southeast United States. For purposes of ski industry statistics, Pennsylvania is considered to be in the Southeastern United States. As such, Jack Frost and Big Boulder are our Southeastern United States ski areas. The map below illustrates the geographical diversity of our 12 properties.
 
(GRAPH)
 
We operate some or all of certain of our resorts pursuant to lease agreements with third parties that own the land underlying these resorts. We lease the land on which we operate Mad River, Crotched Mountain, Jack Frost, Big Boulder and a portion of Paoli Peaks from third parties. Our lease at Paoli Peaks terminates in 2078, our lease at Crotched Mountain terminates in 2053 (though we have 10 options to extend the lease for additional periods of 15 years each), and our lease at Mad River terminates in 2026. Currently, the leases for our Jack Frost and Big Boulder resorts provide that the lessor has a right to terminate the leases at any time, upon the payment of certain fees.


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Some or all of the land underlying certain of our other resorts is owned by the federal government, and we use this land pursuant to Forest Service Special Use Permits. All of the land underlying Wildcat Mountain is owned by the federal government and used pursuant to a Special Use Permit that expires in 2050. Additionally, we use a substantial portion of the skiable terrain at our Attitash and Mount Snow resorts pursuant to Special Use Permits that each expire in 2047.
 
We own the remaining land underlying Paoli Peaks, Mount Snow and Attitash, as well as all of the land underlying Hidden Valley, Snow Creek, Boston Mills and Brandywine.
 
The following table illustrates our ski resorts, the number of visitors to each resort during the fiscal year ended April 30, 2011 and the revenues each resort contributed to the Company’s overall performance for the fiscal year ended April 30, 2011.
 
                                         
(Revenue figures in millions, Vertical Drop in feet)
    Developed/
  FY 2011   Acres   Lift
  Vertical
  Snow-
   
Resort   Acquired   Revs   % Revs   Visits   Total   Skiable   Count   Drop   making(1)   Resort Uses
 
 
Hidden Valley
  1982   $3.6   4%   84,100   250   45   6   310’   100%   Ski area,
Tube park
Snow Creek
  1985   $2.9   3%   70,900   460   40   5   300’   100%   Ski area,
Tube park
Paoli Peaks
  1997   $4.0   4%   91,900   35   35   8   300’   100%   Ski area,
Tube park
Mad River
  2001   $7.5   8%   179,500   144   60   10   300’   100%   Ski area,
Tube park
Boston Mills
  2002   $4.9   5%   141,300   100   61   8   240’   100%   Ski area
Brandywine
  2002   $4.8   5%   140,400   102   88   7   240’   100%   Ski area,
Tube park
Crotched Mountain
  2003   $3.8   4%   104,200   251   80   5   900’   100%   Ski area
Jack Frost
  2005   $6.2   6%   129,200   201   80   10   600’   100%   Ski area,
Tube park
Big Boulder
  2005   $5.5   6%   124,900   107   65   9   400’   100%   Ski area,
Tube park
Attitash
  2007   $12.0   12%   142,600   1,134   307   11   1,750’   90%   Ski area,
Summer activity
Mount Snow
  2007   $38.6   40%   466,200   588   490   21   1,700’   80%   Ski area, Tube park,
Summer activity
Wildcat
  2010   $2.9   3%   77,100   225   225   4   2,100’   90%   Ski area,
Mountain
                                      Summer activity
 
(1) Represents the approximate percentage of skiable terrain covered by our snowmaking capabilities.
 
Operational Goals
 
Our operational goals include providing a quality ski experience for both traditional and alternative snow sports and maintaining maximum snowmaking capability to increase operable business days.
 
We, like other operators of day ski areas and overnight drive ski areas, have a high fixed cost basis, attributable to snowmaking, human resource costs, equipment operation, maintenance and repairs. As such, day ski areas and overnight drive ski areas operate with significant operating leverage and economies of scale. Therefore, increasing skier visits and, to a lesser extent, increasing revenues per skier visit, has a substantial impact on revenues.
 
Adverse weather patterns are one of the core challenges faced by the entire industry. We anticipate this challenge and employ snowmaking systems, provide snowmaking capability on substantially all ski-able areas and budget for complete season snowmaking rather than rely on natural snowfall at any time during a ski season that is already relatively short.


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We believe that we have adopted the most efficient snowmaking system available, the Polecat, as standard equipment at all of our resorts. We also have access to abundant free water supplies at all of our resorts, and through evaporation and melting, the water pumped to make snow eventually returns to these onsite water sources. Thus, we pay nothing to operate the Polecat other than the cost of energy to run the equipment, and the Polecat system technology operates to make a significant amount of snow while reducing our energy costs. We average two Polecats per acre, at a cost of $30,000 per acre, believed to be among the highest ratios in the industry. We believe that this system provides us with a competitive advantage over less efficient operators and resorts with incomplete snowmaking coverage.
 
The impact that snowmaking has on the ski experience is significant. Our commitment to snowmaking excellence is an important component in developing our brand and ongoing market reputation.
 
Strategic Goals
 
Our strategic goals include continuing to build geographical diversity, increasing market share by acquiring additional locations and maximizing per-location results. We believe that we are uniquely poised for continued growth within the market as a result of our industry-tested principles, proven and profitable results at our current resorts, experience with acquisitions and resort facility revitalization and a portfolio and financial position strong enough to accommodate investment in additional properties and development opportunities. We will continue to monitor attractive acquisition targets throughout the United States.
 
Our acquisition strategy is illustrated best by our past resort acquisitions. Our commitment to snowmaking has been a core component of our expansion, as we seek to acquire properties with on-site water resources sufficient to satisfy snowmaking needs and cover substantially all of the resort terrain. We currently consider all potential acquisition targets that would fit within our day ski area and overnight drive ski area expertise and complement our current resort portfolio. More specifically, we intend to actively pursue acquisitions in the regions in which we currently operate in order to enhance our presence within those markets and maximize certain operational efficiencies. Furthermore, in order to mitigate the risk that unfavorable weather may have on our annual revenues and further diversify our geographical footprint, we also intend to identify and monitor potential acquisition targets in new regions of the United States.
 
In addition to our acquisition strategies, we are continually investing in our existing resorts in order to maximize our revenues and increase our efficiencies within our current operations. For example, we are currently seeking approval for the redevelopment of Mount Snow. In October 2010, we submitted an Act 250 Application for our master plan, which involves constructing 900 residential units and larger skier service buildings to house restaurants, ski rental and other retail shops, guest services and other functions. The Vermont District Environmental Commission held hearings in November 2010 and February 2011. In June 2011, we expect the Vermont District Environmental Commission to issue its findings, which we expect will include approval of the master plan concept, but not of the actual construction phases. In June 2011, we intend to submit an Act 250 permit application for our first phase of construction, which includes the building of 110 residential units, one of which will hold an equipment rental facility, and a 33,000 square foot base lodge that will house a cafeteria, restaurant/bar, retail shop, ticketing and bag check. In August 2011, we intend to submit a permit application for zoning approval. We expect the permitting process to last through the end of the calendar year and, depending on financing, permits and market conditions, we could begin construction as early as spring 2012. The redevelopment of Mount Snow will not disrupt any of the skier services provided to our guests. While the redevelopment will affect the location of some of these services, we will move affected services on a temporary basis, as needed.
 
Mount Snow serves the large population base of metropolitan New York City and surrounding areas. With a prime Northeast location and a decades-old tradition, we believe that appropriate mixed-use property development, including updated skier services, additional amenities and added occupancy capability, will create a significant opportunity for us and maximize Mount Snow’s profitability potential.


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Revenue Components
 
We, like other day ski area and overnight drive ski area operators, earn our revenues in five principal categories. In order of their contribution, they are: lift tickets; food and beverage sales; equipment rentals; ski instruction; hotel/lodging; and merchandise sales. We have established company-wide standards within each key revenue center geared toward increasing skier visits and providing a quality ski experience. Key components of our strategy include promoting advance ticket purchases and group sales, minimizing potential skier bottlenecks in equipment rental and encouraging participation in ski lessons, particularly for new skiers. Each revenue center is discussed in more detail below.
 
                         
 (in thousands)
                       
Revenue%   Fiscal 2011   % of Total   Fiscal 2010   % of Total   Fiscal 2009   % of Total
 
Lift Tickets
  $50,938   52.2%   $46,419   51.7%   $43,447   51.5%
Food & Beverage
  15,131   15.5%   14,023   15.6%   12,870   15.3%
Equipment Rental
  8,147   8.3%   8,040   8.9%   6,986   8.3%
Ski Instruction
  6,868   7.0%   6,179   6.9%   5,688   6.7%
Hotel/Lodging
  6,337   6.5%   5,535   6.2%   5,682   6.7%
Merchandise
  4,282   4.4%   4,084   4.5%   3,897   4.6%
Miscellaneous(1)
  5,883   6.0%   5,565   6.2%   5,723   6.8%
                         
Total Revenue
  $97,586   100.0%   $89,845   100.0%   $84,293   100.0%
                         
 
(1) Miscellaneous includes summer activities and other non-ski related operations.
 
Fiscal 2010, 2009 and 2008 Revenue Composition
 
(PERFORMANCE GRAPH)
 
(1) Miscellaneous includes summer activities and other non-ski related operations.
 
Lift Ticket Sales
 
Lift tickets are our most important source of operating revenues. We place heavy emphasis on sales of season passes and advance group ticket sales to schools, religious organizations and other social groups at a discount. We market our season passes and advance group ticket sales to on-site ski visitors and the communities we


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serve. During the past two fiscal years, we have increased our pre-sale revenues by 5.5% and 1.4%, excluding the effect of Wildcat Mountain. Pre-sold lift tickets accounted for approximately 28.6% and 26.3% of our total lift ticket sales during the past two fiscal years.
 
Most of our resorts typically offer two daily ski sessions during the week and three daily ski sessions on weekends and holidays. The cost of lift tickets at each of our resorts varies according to geographic region, session time and day of the week. The following chart demonstrates the average ETP at each of our resorts over the past six ski seasons. The data of Wildcat Mountain is included for comparison purposes but is not included in Company totals elsewhere in this Prospectus until the effective date of acquisition. The prices included in the lift ticket calculation include only the tickets sold and season pass sales.
 
(PERFORMANCE GRAPH)
 
Food and Beverage Sales
 
The second largest revenue component is generated by food and beverage sales. Our facilities generally employ cafeteria-style and self-service options to provide a limited menu of simple foods, liquor, beer and wine. We try to maximize revenues and simplify operations by focusing on a limited menu that requires minimal special preparation related personnel costs.
 
Equipment Rentals
 
The third largest revenue component is generated by equipment rentals. Day ski areas generally attain a higher percentage of rental revenue than overnight fly destination ski areas and overnight drive ski areas because a large majority of day ski area skiers are novices, who typically do not own ski equipment. Equipment rental rates generally range between $23.00 and $35.00 per person per session. We have focused on improving our equipment rental facilities to provide quick access to new and high quality equipment, self-service options with expert advice


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and fitting available, and immediate access to the lifts and ski instruction areas from the rental facility. By eliminating the equipment rental bottleneck, we believe that we have significantly enhanced the skiers’ resort experience, which corresponds to increased rental revenues.
 
Instruction Services
 
Skiing lessons do not make up a significant portion of our consolidated revenues, but are considered important to operations because of the large numbers of novice or early intermediate skiers who typically visit day ski areas. We offer low group lesson prices to encourage participation, which range from $15.00 to $48.00 per person per lesson. Individual instructions and private lessons may range from $43.00 to $100.00 or more per lesson.
 
Hotel/Lodging
 
Because we primarily operate day ski areas, not all of our resorts offer hotel or other lodging services. Our hotel/lodging revenue is comprised of the revenue generated by the lodging facilities at our Attitash and Mount Snow ski areas. Attitash and Mount Snow each have a Grand Summit Hotel on their properties, in which individuals purchase quartershare interval interests while we retain ownership of core hotel and commercial properties. We derive a revenue stream from operating the Grand Summit Hotels’ retail, restaurant and conference facilities and from renting quartershare interval interests when not in use by their owners. We also manage certain condominiums located near the Mount Snow ski area and receive a portion of the rental fees and property management fees relating to these condominiums. Finally, a small portion of the hotel/lodging revenue is comprised of room reservation fees generated by the Snow Lake Lodge at Mount Snow, fees for spa and health club services at the Grand Summit Hotels and fees for housekeeping and other related services.
 
Merchandise Sales
 
Like ski instruction services, merchandise sales also represent a relatively small percentage of our total revenues. Some of our resorts offer a selection of more substantial ski-related equipment, such as boots, skis and snowsuits, while others maintain only a minimal selection of smaller items, such as gloves and goggles. Merchandise selection and pricing decisions must be made in light of the local demographic conditions. To facilitate this level of detailed management, local ski area employees oversee their merchandise operations as they see fit for their markets. We also lease merchandise operations to third party merchants at Boston Mills, Brandywine and Paoli Peaks.
 
Marketing
 
We promote our resorts through both on-site marketing and external marketing. As discussed above, we encourage visitors to return to our resorts by offering complimentary skier orientations at our resorts. We also have marketing programs in place directed at attracting groups, such as religious organizations, social clubs, corporate entities, schools and civic organizations, and we offer discounts to active military personnel. We believe that these group discounts encourage new participants to try snow sports. Student passes are also sold through schools, and season passes are promoted through targeted direct mail marketing, the internet and local sporting goods stores.
 
Each of our resorts also maximizes community awareness through radio, special events and promotions and “free media” advertising, when possible. We host charity events and tournaments, issue free media passes and encourage live radio and television broadcasts for segments such as weather or sports, including the following:
 
  •   Dew Tour
  •   X-Games
  •   Tough Mudder
  •   SAM Cutters Camp
  •   Transworld Trans-am Snowboard Event
  •   Mountain Dew Vertical Challenge
  •   NCAA National Downhill Championships
  •   Special Olympics Games
  •   Military Salutes
  •   U.S. National Mountain Biking Championships


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Finally, local tourist bureaus, lodging providers and travel agents are contacted regularly to keep the ski experience offered by our resorts at the forefront of local entertainment options.
 
Most marketing efforts drive traffic to our websites, where we provide guests with information regarding each of our resorts, including services and amenities, weather conditions, options for advance lift ticket purchases, live snow-cams, events and hospitality information.
 
Competition
 
We believe that there are high barriers to entry for new ski areas due to the limited private lands on which ski areas can be developed, the difficulty in getting the necessary government approvals and permits to build on public land and the substantial capital resources needed to construct the required ski infrastructure. As such, we believe that the risk that our market will become saturated with new industry participants is relatively low. We believe that our resorts do not directly compete with overnight fly destination ski areas, such as the larger ski resorts in Colorado, California, Nevada, Utah and other destination ski areas worldwide. Rather, we believe that we compete primarily with other existing day ski areas, overnight drive ski areas and non-ski related day vacations. The day ski area and overnight drive ski area industries currently consist of 471 resorts nationwide.
 
Our competition varies by geographical area. While we believe that our Midwest ski resorts face only limited competition within their relative metropolitan markets, we are not the only day ski areas or overnight drive ski areas in our Northeast and Southeast markets. We compete with approximately 135 resorts in the Northeast United States and 53 resorts in the Southeast United States. Based on the number of resorts we operate, we are the largest ski resort operator in the United States.
 
Environmental Protection
 
The use of energy and environmental sustainability are concerns to the ski industry as a whole. We are committed to employing environmentally friendly practices in providing exemplary service to our guests and community. We continually evaluate and improve our operations, and we optimize the positive impact of our sustainable efforts through partnerships with our guests, local community and suppliers.
 
As noted in “Operational Goals” above, we have adopted the Polecat system of snowmaking, which produces a significant amount of snow while reducing our energy costs. In addition, we use Polecat fan guns that are powered by electricity and have on-board compressors. As a result, we use diesel powered compressors at our Wildcat Mountain ski area only. We believe that the significant reduction in our use of compressors eliminates a substantial amount of diesel exhaust and carbon dioxide emissions each year.
 
Additionally, the hotel located on our Attitash resort, the Attitash Grand Summit Hotel, has been certified as a sustainable lodging facility by the New Hampshire Lodging and Restaurant Association. Likewise, the Grand Summit Resort Hotel on our Mount Snow resort has been certified as a green hotel by Vermont’s Green Hotels in the Green Mountain State program. The operating systems and practices that we have in place at these hotels reduce energy use, conserve water and reduce both hazardous and non-hazardous waste.
 
Finally, we have implemented recycling and re-use programs at our resorts and choose environmentally friendly alternatives to harsher chemicals to operate some of our equipment. For example, we use 100% Castrol synthetic oil to lubricate the lift cables on our ski lifts instead of a petroleum-based oil. We also use an environmentally friendly anti-freeze for ski lift and snowmaking compressor maintenance.
 
Seasonality
 
Ski resort operations are highly seasonal in nature, with our typical ski season beginning mid-December and running through the end of March. In an effort to partially counterbalance the concentration of revenue during the winter months, some of our properties offer non-ski attractions, such as golf, roller coasters, swimming and zip rides, but these activities do not comprise a substantial portion of our annual revenues.
 
We generate a large percentage of our revenues on weekends (Friday through Sunday) during the ski seasons and three holiday periods during the ski season — Christmas, Dr. Martin Luther King, Jr. Day and Presidents Day.


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The following table illustrates the percent of our total consolidated revenues contributed during these times for the past three ski seasons:
 
                         
    2010/2011 Ski
  2009/2010 Ski
  2008/2009 Ski
    Season   Season   Season
 
Weekends During Ski Season(1)
    31 %     33 %     38 %
Christmas
    14 %     15 %     10 %
Dr. Martin Luther King, Jr. Day
    7 %     6 %     6 %
Presidents Day
    6 %     8 %     7 %
 
(1) Excludes Christmas, Dr. Martin Luther King, Jr. Day and Presidents Day if those days occurred on a Friday, Saturday or Sunday during the ski seasons reported.
 
Employees
 
We, together with our operating subsidiaries, currently employ approximately 400 year-round employees. During the height of our ski season, we employ approximately 7,500 seasonal employees.
 
Regulation and Legislation
 
The 1986 Ski Area Permit Act and Master Development Plans
 
The 1986 Ski Area Permit Act (the “1986 Act”) allows the Forest Service to grant Term Special Use Permits for the operation of ski areas and construction of related facilities on National Forest lands. In addition, the permits granted to our ski areas under the1986 Act require a Master Development Plan for each ski area that is granted a Special Use Permit. Of our 12 resorts, only portions of Attitash and Mount Snow and all of Wildcat Mountain operate under Special Use Permits. The ski-able terrain at our other resorts is located on land that we own or lease from non-government third parties.
 
Each area of National Forest land is required by the National Forest Management Plan to develop and maintain a Land and Resource Management Plan, which establishes standards and guidelines for the Forest Service to follow and consider in reviewing and approving our proposed actions. Under the 1986 Act, the Forest Service has the right to review and approve the locations, design and construction of improvements in the permit area and many operational matters.
 
The Special Use Permits expire as follows: Attitash ski area - April 4, 2047; Mount Snow ski area - April 4, 2047; and Wildcat Mountain ski area - November 18, 2050. We intend to request a new Special Use Permit for each resort as provided by the Forest Service regulations and terms of each existing Special Use Permit. To our knowledge, the Forest Service has never refused to issue a new Special Use Permit to replace an existing Special Use Permit for a ski resort in operation at the time of expiration.
 
Each Special Use Permit contains requirements and obligations on our part, including that we indemnify the Forest Service from third-party claims arising out of our operation under the Special Use Permit and that we comply with all applicable laws. We pay a fee to the Forest Service for the Special Use Permit which, pursuant to the terms of each Special Use Permit, could range from 1.5% to 4.0% of sales for services on Forest Service land. Historically we have paid fees ranging from 1.5% to 2.5% of sales for services on Forest Service land and do not expect that this will change in the near future. Included in the calculation are sales from lift tickets, season passes, ski instructions, food and beverages, equipment rental, merchandise, and other ancillary services.
 
The Special Use Permits may be amended by mutual agreement between us and the Forest Service to change the applicable ski area or permitted uses. The Forest Service may also modify the Special Use Permit to accommodate changes in plans or operations. Permit amendments must be consistent with the Forest Plan and are subject to the provisions of the National Environmental Policy Act (“NEPA”).


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The Forest Service may also terminate a Special Use Permit if it determines that termination is required for specific compelling reasons. However, to our knowledge, no Special Use Permit has ever been terminated by the Forest Service without the consent of the operator.
 
We must propose a Master Development Plan for all improvements that we intend to make on National Forest lands and submit such plans to the Forest Service for review and acceptance. Once the Forest Service accepts a Master Development Plan, individual projects contemplated by the Master Development Plan will only be approved by the Forest Service upon separate applications that meet the requirements set forth by the Forest Service, including the requirements contained in the Special Use Permit.
 
National Environmental Policy Act
 
Under NEPA, our major proposed actions on all National Forest land, such as the expansion of a ski area or installation of new snowmaking equipment, must be assessed to determine the environmental impacts of such actions. Upon our application to the Forest Service to undertake major projects, the Forest Service must conduct an environmental study, which can impact the time it takes to complete a project. During these studies, the Forest Service is required to consider alternatives to proposed actions and the impacts that may be unavoidable. We may not get the Forest Service’s approval to undertake a project or may be required to take alternative action, depending on the results of the environmental studies.
 
Underground Storage Tank Regulations
 
We have underground storage tanks (“USTs”) on our ski area properties in Ohio, New Hampshire, Pennsylvania and Vermont for the purpose of storing gasoline, fuel oil and propane that we use in the operation of our resorts, lodges and skier service buildings. The federal Solid Waste Disposal Act gives the Environmental Protection Agency (“EPA”) the authority to regulate USTs. State UST programs that are at least as strict as the federal regulations and that have been approved by the EPA govern the USTs in lieu of the federal regulations. The objectives of the state UST programs are to ensure that:
 
  •   USTs are properly constructed and designed in accordance with recognized industry standards;
 
  •   installations, repairs and removals are conducted and inspected by qualified and trained individuals;
 
  •   active USTs are properly operated and monitored for the release of substances; and
 
  •   upon closure, USTs are properly decommissioned and sites are assessed for contamination.
 
We believe that the USTs at our facilities meet all state and federal construction and operation standards. Compliance with these UST regulations has not had a material impact on our capital expenditures, earnings or competitive position, and we do not expect it to have a material impact in the future.


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MANAGEMENT
 
Directors and Executive Officers
 
Set forth below are the names, ages as of May 31, 2011 and positions with our Company of the persons who will serve as our directors and executive officers upon the consummation of this offering.
 
                 
Name     Age     Position
Timothy D. Boyd
      58       Chief Executive Officer, President, Director
Stephen J. Mueller
      63       Chief Financial Officer, Vice President, Secretary, Director
Richard Deutsch
      57       Vice President Business and Real Estate Development, Director
Jesse K. Boyd
      30       Vice President Resort Operations
James T. Barry, Jr. 
      65       Director
Gregory R. Diekemper
      53       Director
Stanley W. Hansen
      68       Director
Michael Staenberg
      57       Director
                 
 
Timothy D. Boyd is the Chief Executive Officer, President and Director of the Company, and has served in these roles since the Company was founded in 1997. In 1982 and 1985, he developed the Hidden Valley ski area in St. Louis, Missouri and the Snow Creek ski area in Kansas City, Missouri, respectively, which are now owned by the Company. Mr. Boyd has extensive experience in the operation of day ski areas and overnight drive ski areas, as well as snowmaking. The board believes that this experience and his positions of Chief Executive Officer and President provide him with intimate knowledge of the Company’s day-to-day operations, business and competitive environment, as well as the Company’s opportunities, challenges and risks. Mr. Boyd graduated from the University of Missouri with a Bachelor of Science degree in Education and Economics. Mr. Boyd’s son, Jesse K. Boyd, is the Company’s Vice President Resort Operations and a named executive officer.
 
Stephen J. Mueller serves as the Company’s Chief Financial Officer, Vice President, Secretary and Director and has held these positions since 2001. In these positions, Mr. Mueller serves as the Company’s principal financial officer and is responsible for all financial and accounting aspects of the operations. Prior to joining the Company, Mr. Mueller was a shareholder with a firm of certified public accountants that he founded in 1991. He has also served as a partner at Touche Ross & Co. (now Deloitte & Touche LLP) and as Chief Financial Officer of an environmental services firm. While in public accounting, Mr. Mueller served a wide variety of clients in construction, service and recreation activities. Mr. Mueller received a Bachelor of Science degree in Accounting from St. Louis University. The board selected Mr. Mueller because of his experience in finance and accounting, as well as for his in-depth knowledge of the Company.
 
Richard Deutsch is the Company’s Vice President Business and Real Estate Development and a Director. He has served in these positions for over ten years. As the Vice President Business and Real Estate Development, Mr. Deutsch is responsible for developing the Company’s growth strategy, along with Messrs. T. Boyd and Mueller, and identifying and evaluating acquisition targets and other potential growth opportunities. The board believes that Mr. Deutsch’s successful acquisition experience in the ski industry and his understanding of the Company’s operations will be valuable in executing the Company’s growth strategy.
 
Jesse K. Boyd is the Vice President Resort Operations of the Company and has served in this position since 2008. As the Vice President Resort Operations, Mr. Boyd is responsible for overseeing the implementation of all of the operating procedures and policies for our ski areas. Prior to holding this position, Mr. Boyd was the General Manager of the Jack Frost and Big Boulder ski areas. Mr. Boyd has held several positions with the Company since 2003, including Manager of Outside Operations at the Hidden Valley ski area and Manager of Terrain Park Development. Mr. Boyd has a Bachelor of Science degree in Business Administration and Computer Science from Milligan College. Jesse K. Boyd is the son of Timothy D. Boyd, the Company’s Chief Executive Officer, President and Director.


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James T. Barry, Jr., now retired, was a principal of The Barry Law Firm, which he founded in 1980. The Barry Law firm, which has received the highest legal rating (a “v”) by the Martindale — Hubbell Law directory, concentrates on banking, business and commercial matters. Mr. Barry practiced law for over 40 years and represented numerous institutions and businesses in the St. Louis, Missouri area. Mr. Barry is a 1967 graduate of the University of Notre Dame with a degree in Finance, and he received his juris doctorate from the St. Louis University School of Law in 1970. Currently, Mr. Barry is a director of the Evans Scholar Foundation/Western Golf Association and a member of the Missouri and Illinois Bar Associations, as well as a number of other professional and civic organizations. The board selected Mr. Barry because of his legal experience in the areas of taxation, mergers and acquisitions and general business matters.
 
Gregory R. Diekemper is the President and Chief Executive Officer of Swank Audio Visuals and has served in these positions since November 2005. Mr. Diekemper has served in various positions at Swank Audio Visuals and an affiliated entity since 1994, including Controller, Chief Financial Officer, Vice President and Executive Vice President. In these positions, Mr. Diekemper was responsible for company finances and accounting, risk management, budgeting, internal control, marketing and other administrative aspects of operations. Swank Audio Visuals provides audio visual equipment and related professional technical services for approximately 330 hotels, conference centers and resorts in more than 60 cities in the United States, Canada and the Middle East. From 1985 to 1994, Mr. Diekemper served as Controller, Vice President, Chief Financial Officer and Treasurer of Guarantee Electrical. He graduated from the University of Missouri with a Bachelor’s Degree in Business Administration (Accountancy). The board selected Mr. Diekemper because of his financial and accounting expertise, his experiences as the principal financial officer of large companies and his work in the hospitality industry.
 
Stanley W. Hansen, now retired, has over 40 years of experience in the operation of ski resorts. From 2008 to 2010, Mr. Hansen served as a director of Squaw Valley Development Company, the owner and operator of the Squaw Valley ski area in Lake Tahoe, California. From 2005 to 2007, he served as Senior Vice President Real Estate of American Skiing Company, the former owner of numerous ski areas throughout the United States, including Mount Snow and Attitash, and a company with a class of stock formerly registered pursuant to Section 12 of the Securities Exchange Act of 1934. Mr. Hansen served as Managing Director of Mount Snow from 2002 to 2005 when it was owned by American Skiing Company. From 1966 to 2001, Mr. Hansen held several positions with Heavenly Ski Resort, including President, General Manager and Senior Vice President. The board selected Mr. Hansen because of his specialized knowledge and skills relating to the ownership and operation of ski areas, his experience relating to past ski area acquisitions and his first-hand experience in the operations of Mount Snow. Mr. Hansen graduated from San Jose State University with a Bachelor’s degree in Business Management. He was also a part of the Stanford Executive Program in Finance and Marketing from 1985 to 1986.
 
Michael Staenberg is currently the President of THF Realty, a company he founded in 1991, and has been since 1991. THF Realty is a real estate developer with over 22 million square feet of property and retail shopping centers. Mr. Staenberg has been active in the real estate business for over 27 years, and he has served as the developer of more than 100 shopping centers in over 25 states. Mr. Staenberg has won awards in the St. Louis area recognizing his business leadership and entrepreneurship. Currently, Mr. Staenberg is a member of the International Council of Shopping Centers and the Metropolitan St. Louis Board of Realtors, in addition to being involved with numerous charitable organizations. He is a graduate of the University of Arizona with degrees in Economics and Finance. Mr. Staenberg has extensive experience in the development and acquisition of property, especially relating to large commercial property. Furthermore, Mr. Staenberg has a unique understanding of the property development process as it relates to zoning, permitting and land use as a result of his first-hand development experiences. The board feels that Mr. Staenberg’s skills will serve as an asset to the board when evaluating the Company’s growth and acquisition strategies, as well as its maintenance and improvement plans.
 
Composition and Committees of the Board
 
Our board currently consists of seven directors. Our board has established the following committees: an audit committee, a compensation committee and a nominating and corporate governance committee. The composition and responsibilities of each committee are described below. Members serve on these committees until their resignation or until otherwise determined by our board.


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The majority of our board members are independent. The board has determined that each of Messrs. Barry, Diekemper, Hansen and Staenberg is an independent director pursuant to the requirements of NASDAQ, and each of the members of the audit committee satisfies the additional conditions for independence for audit committee members required by NASDAQ.
 
Audit Committee
 
Messrs. Barry, Diekemper and Hansen, each an independent director, serve on our audit committee. Mr. Diekemper is the chair of the audit committee. The committee assists our board in its oversight responsibilities relating to (i) the quality and integrity of our financial statements, (ii) our accounting and reporting policies and procedures, (iii) our risk management policies, (iv) our compliance with legal and regulatory requirements that may have a material impact on our financial statements, (v) our independent registered public accounting firm’s qualifications, independence and performance, (vi) our disclosure controls and procedures, and (vii) our internal control over financial reporting. The board has determined that Mr. Diekemper qualifies as an “audit committee financial expert” as that term is defined in Item 407(d)(5) of Regulation S-K, as promulgated by the SEC.
 
Compensation Committee
 
Messrs. Barry, Hansen and Staenberg serve on our compensation committee. Mr. Barry is the chair of the compensation committee. The committee is responsible for designing, approving and evaluating executive compensation and benefits, as well as reviewing and approving such other compensation matters as the committee deems appropriate. Each member of the committee is independent, a “non-employee director” for purposes of Rule 16b-3 under the Exchange Act, and an “outside director” for purposes of Section 162(m) of the Internal Revenue Code of 1986.
 
Nominating and Corporate Governance Committee
 
Messrs. Barry, Diekemper and Staenberg, each an independent director, serve on our nominating and corporate governance committee. Mr. Staenberg is the chair of this committee. The committee is responsible for identifying individuals qualified to become directors and committee members; recommending director nominees to the board; developing and recommending approval of policies and guidelines relating to, and generally overseeing matters of, corporate governance; and leading the board’s annual review of its committee charters.
 
Compensation Committee Interlocks and Insider Participation
 
Though our board did not have a compensation committee during the entire current or previous fiscal year, none of the individuals who currently serve on our compensation committee has served our company or any of our subsidiaries as an officer or employee. In addition, none of our executive officers serves as a member of the board of directors or compensation committee of any entity which has one or more executive officers serving as a member of our board or compensation committee.
 
Code of Ethics
 
We have adopted a Code of Conduct and Business Ethics applicable to all employees, including executive officers, and directors. A copy of the Code of Conduct and Business Ethics is available on our corporate website at www.peakresorts.com. Any amendments to the Code of Conduct and Business Ethics, or any waivers of its requirements, will be disclosed on our website and reported to the SEC, as may be required.
 
Director Compensation
 
Historically, our directors have not received compensation for their service. In connection with this offering, we adopted a new director compensation program pursuant to which our non-employee directors will receive a $10,000 annual retainer for service on our board and $2,500 for each board and committee meeting attended. We reimburse our non-employee directors for reasonable travel expenses incurred in attending the board and committee


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meetings. We also intend to allow our non-employee directors to participate in any equity compensation plans that we adopt in the future, on the same terms as other eligible employees.
 
Our audit committee held one meeting during the fiscal year ended April 30, 2011, and the members were paid $2,500 each for participation in this meeting in accordance with our new director compensation program, as illustrated in the table below. Otherwise, no directors received compensation for their service during the year ended April 30, 2011.
 
                     
Name     Fees Earned or Paid in Cash     Total
Timothy D. Boyd
               
Stephen J. Mueller
               
Richard Deutsch
               
James T. Barry, Jr. 
    $ 2,500       $ 2,500  
Gregory R. Diekemper
    $ 2,500       $ 2,500  
Stanley W. Hansen
    $ 2,500       $ 2,500  
Michael Staenberg
               
                     
 


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EXECUTIVE COMPENSATION
 
Compensation Discussion and Analysis
 
This Compensation Discussion and Analysis describes and explains our compensation program for the fiscal year ended April 30, 2011 for our named executive officers, who are listed as follows:
 
  •   Timothy D. Boyd, Chief Executive Officer and President;
  •   Stephen J. Mueller, Chief Financial Officer, Vice President and Secretary;
  •   Richard Deutsch, Vice President Business and Real Estate Development; and
  •   Jesse K. Boyd, Vice President Resort Operations.
 
This section also explains how we expect the compensation of our named executive officers will change following this offering.
 
Historical Compensation Decisions
 
Our compensation approach has been tied to our stage of development as a Company. Before this offering, we were privately-held and therefore not subject to any stock exchange or SEC rules relating to compensation, board committees and independent board representation. We informally considered the responsibilities connected with each management position and the available funds for management compensation when making past compensation decisions. Each year after the financial statements had been prepared for the prior fiscal year, Messrs. Boyd, Mueller and Deutsch convened to discuss compensation of management and certain other employees, including themselves, and made adjustments to executive pay as they deemed appropriate and feasible given the Company’s financial position.
 
Though we did not have a formal compensation program in place, we believe that our informal program and compensation methods furthered the following objectives:
 
  •   to retain talented individuals to contribute to the Company’s sustained progress, growth and profitability; and
 
  •   to reflect the unique qualifications, skills, experiences and responsibilities of each individual.
 
New Compensation Philosophy and Objectives
 
We recently formed a compensation committee comprised of board members who meet the definition of independent as set forth in applicable NASDAQ rules. As of its inception, the compensation committee has been tasked with the responsibility to establish and implement our new compensation philosophy and objectives, administrate the Company’s executive and director compensation programs and plans, and review and approve the compensation of our named executive officers. The committee is currently in the process of evaluating our historical compensation practices and customizing a new management compensation program for our specific circumstances.
 
As we gain experience as a public company, we expect that the specific direction, emphasis and components of our executive compensation program will continue to evolve. Accordingly, the compensation paid to our named executive officers in the past is not necessarily indicative of how we will compensate them after this offering.
 
Compensation Committee Procedures
 
The compensation committee’s responsibilities are specified in its charter. The compensation committee’s functions and authority include, among other things:
 
  •   determination of the chief executive officer’s compensation and annual evaluation of the chief executive officer’s performance;
 
  •   approval of the compensation for all other executive officers;


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  •   recommendation and administration of incentive and equity compensation plans, as well as other employee benefit plans;
 
  •   review and recommendation of employment, severance and change of control agreements for executive officers; and
 
  •   management of risk relating to incentive compensation.
 
Elements of Compensation
 
Historically, our executive officers have received annual salaries as their compensation for services. We believe that our key executives’ compensation is reflective of their leadership roles in a growing company in relation to our financial performance. While we do not have access to the compensation programs of most of our peers within the industry because they are privately-held, we believe that our executive compensation is competitive within the industry and adequate to retain and incentivize our key executives.
 
As part of the compensation committee’s review of executive compensation, the committee determined to raise Mr. J. Boyd’s salary to $175,000, effective June 1, 2011. The compensation committee made this decision in light of an increase in Mr. J. Boyd’s responsibilities, as he is now responsible for the supervision of all resort operations, and to align his compensation more closely with that of a supervisory position, creating internal equity among his salary and those of the resort managers whom he supervises. The fiscal 2011 salaries for Messrs. T. Boyd and Mueller, which are set forth in their employment agreements discussed below, and Mr. Deutsch remain the same as their fiscal 2010 salaries. The compensation committee did not raise the salaries of Messrs. T. Boyd, Muller and Deutsch, as the committee felt that the compensation was adequate and appropriate for their positions and responsibilities.
 
In the past, we have not included equity compensation as part of our executive compensation packages because, prior to this offering, there was no public market for our common stock. In addition, we did not want to dilute the ownership of the stockholder group that existed prior to the public offering of our common stock. In the future, we may provide our named executive officers both short and long-term incentive compensation as part of our new compensation practices which may include cash bonuses, restricted stock and options to purchase our common stock, as the compensation committee may deem appropriate. Our compensation committee is in the process of evaluating various forms of short and long-term compensation and how such awards will fit into the new compensation program that it is developing.
 
Other Executive Benefits
 
Our named executive officers are eligible for the following benefits on the same basis as other eligible employees:
 
  •   health insurance;
  •   vacation, personal holidays and sick days;
  •   life insurance and supplemental life insurance;
  •   short-term and long-term disability; and
  •   a 401(k) plan with matching contributions.
 
Employment Agreements
 
In connection with this offering, effective June 1, 2011, the Company entered into an executive employment agreement (“Agreement”) with each of Messrs. T. Boyd and Mueller (each, an “Executive”). Pursuant to their respective Agreement, Messrs. T. Boyd and Mueller are paid the following base salaries, not to be lowered during the term of the agreement and to be reviewed annually by the compensation committee: Mr. T. Boyd — $442,000 and Mr. Mueller — $416,000.
 
Each Agreement provides that the Executive shall be eligible to participate in any incentive, equity or other compensation plans that the Company may implement relative to executive officers and to receive cash, equity or other awards as the compensation committee and board of directors deem appropriate, in their discretion.


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Furthermore each executive shall be eligible to participate in other benefit plans and receive perks on the same terms as other senior executives of the Company. The Company will provide each Executive with a travel and entertainment budget that is reasonable in light of his position and responsibility and reimburse the Executive for such expenses upon receipt of appropriate documentation.
 
The term of each Agreement is for three years, from June 1, 2011 to May 31, 2014, and shall be automatically renewed for successive one-year periods unless, no later than 60 days before the expiration of the term, either party gives the other written notice of non-renewal.
 
Each Agreement provides that the Company or Executive may terminate the agreement with or without cause and with or without good reason, respectively. Additionally, each Agreement contains termination rights in the event of the Executive’s death or disability. Please see “— Payments upon Termination or a Change in Control” for further information regarding termination rights and payments due to the Executive upon termination or a change in control.
 
Each Agreement contains non-competition and non-solicitation provisions that endure for a period of two years following the Executive’s termination of employment with the Company. The Company will indemnify the Executive in connection with legal proceedings against the Executive in his capacity as a director, officer or employee of the Company to the fullest extent permitted by the Company’s amended and restated articles of incorporation and amended and restated by-laws.
 
Tax Considerations
 
In the past, we have not taken into consideration the tax consequences to employees and the Company when considering types and levels of awards and other compensation granted to executives and directors; however, we anticipate that the compensation committee will consider these tax implications when determining executive compensation in the future.
 
Compensation Recoupment Policy
 
Our board recently adopted a compensation recoupment policy that applies to the Company’s current and former executive officers. The policy provides that in the event the Company is required to prepare an accounting restatement due to the material non-compliance of the Company with any financial reporting requirement under the laws and regulations of the SEC, the Company will recover from any current or former executive officer who received cash bonuses, equity awards or other incentive-based compensation during the three-year period preceding the date on which the Company is required to prepare an accounting restatement, based on the erroneous data, the excess paid to the executive officer due to the erroneous data.


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2010 Summary Compensation Table
 
The following table sets forth all compensation paid to our named executive officers for the years ending April 30, 2010, 2009 and 2008.
 
                         
                  All Other
     
Name and Principal Position     Year     Salary     Compensation(1)     Total
                         
Timothy D. Boyd, Chief Executive Officer and President     2011     $442,000     $27,807     $469,807
 
                         
      2010     $442,000     $25,285     $467,285
 
      2009     $442,000     $12,285     $454,285
 
                         
Stephen J. Mueller, Chief Financial Officer, Vice President
and Secretary
    2011     $416,000     $17,543     $433,543
 
                         
      2010     $416,000     $14,700     $430,700
 
      2009     $416,000         $416,000
 
                         
Richard Deutsch, Vice President Business and Real Estate Development     2011     $416,000         $416,000
 
                         
      2010     $416,000         $416,000
 
      2009     $416,000         $416,000
 
                         
Jesse K. Boyd, Vice President Resort Operations
    2011     $96,250     $11,093     $107,343
 
                         
      2010     $106,250     $7,671     $113,921
 
      2009     $105,521     $8,018     $113,539
 
 
(1) All Other Compensation consists of, for Mr. T. Boyd, the imputed value of group term life insurance premiums paid on his behalf and for Messrs. T. Boyd, Mueller and J. Boyd, for fiscal years 2011 and 2010, the Company’s matching contributions paid to the Company’s 401(k) Plan on behalf of each executive officer. All Other Compensation for Messrs. T. Boyd, Mueller and J. Boyd also includes an allowance for personal automobile usage.
 
Payments upon Termination or a Change in Control
 
Each of Messrs. T. Boyd and Mueller has entered into an Executive Employment Agreement (“Agreement”) with the Company regarding his employment. The following is a description of the termination provisions contained in each Agreement and the payments due to the Executives upon termination or a change in control.
 
The Company may terminate each Agreement at any time for cause, which is defined as: (i) any conduct related to the Company involving gross negligence, gross mismanagement, or the unauthorized disclosure of confidential information or trade secrets; (ii) dishonesty or a violation of the Company’s Code of Ethics and Business Conduct that has or reasonably could be expected to result in a detrimental impact on the reputation, goodwill or business position of any of the companies (as defined in the Agreement); (iii) gross obstruction of business operations or illegal or disreputable conduct by Executive that impairs or reasonably could be expected to impair the reputation, goodwill or business position of any of the companies, and any acts that violate any policy of the Company relating to discrimination or harassment; (iv) commission of a felony or a crime involving moral turpitude or the entrance of a plea of guilty or nolo contedere to a felony or a crime involving moral turpitude; or (v) any action involving a material breach of the terms of the Agreement including material inattention to or material neglect of duties and Executive shall not have remedied such breach within 30 days after receiving written notice from the board specifying the details thereof. In the event of a termination for cause, Executive shall be entitled to receive only Executive’s then-current base salary through the date of such termination. Further, in the event of such a termination for cause, Executive shall not be entitled to receive any bonus payment for the year of termination or subsequent years under any plan in which Executive is then participating.
 
The Company may also terminate each Agreement at any time without cause, as defined above. In the event of such termination without cause, upon execution of a mutual release, Executive shall be entitled to receive


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(i) Executive’s then-current base salary through the effective date of such termination, (ii) if entitled to receive a bonus, a pro-rated bonus for the portion of the Company’s fiscal year through the effective date of such termination, which prorated bonus shall, if applicable, be based on applying the level of achievement of the performance to Executive’s target bonus for the year of such termination payable in a lump sum at the same time as bonuses are paid to the Company’s senior executives generally (the “Pro-Rated Bonus”), and (iii) 24 months of Executive’s then current base salary payable in a lump sum. In addition, provided that both parties have signed a mutual release, all unvested shares or portions of any equity grant not yet vested made under any equity compensation plan of the Company (“Unvested Equity Grants”) shall automatically become fully vested upon termination.
 
Under each Agreement, the Executive may terminate the Agreement at any time for good reason, which means (i) the Company has breached its obligations under the Agreement in any material respect, (ii) the Company has decreased Executive’s then current base salary, (iii) the Company has effected a material diminution in Executive’s reporting responsibilities, authority, or duties as in effect immediately prior to such change, and/or (iv) the occurrence of a change in control (as defined below); provided, however, that Executive shall not have the right to terminate the Agreement for good reason unless: (A) Executive has provided notice to the Company of any of the foregoing conditions within 90 days of the initial existence of the condition; (B) the Company has been given at least 30 days after receiving such notice to cure such condition (other than if good reason is due to a change in control); and (C) Executive actually terminates employment within six months following the initial existence of the condition. In such event, provided that Executive and the Company have executed a mutual release, Executive shall be entitled to receive (i) Executive’s then current base salary through the effective date of such termination, (ii) if entitled to receive a bonus, a Pro-Rated Bonus, and (iii) 24 months of Executive’s then current base salary payable in a lump sum. In addition, provided that the mutual release has been executed, all Unvested Equity Grants, if any, shall automatically become fully vested upon termination.
 
An Executive may also terminate the Agreement at any time without good reason by giving the Company at least sixty 60 days’ prior written notice. In such event, Executive shall be entitled to receive only Executive’s then current base salary through the date of termination.
 
In the event that Executive becomes totally and permanently disabled, the Company shall have the right to terminate the Agreement upon written notice to Executive; provided, however, that in the event that Executive and the Company execute a mutual release, Executive shall be entitled to receive (i) Executive’s then current base salary through the date of such termination, (ii) if entitled to receive a bonus, a Pro-Rated Bonus, and (iii) Executive’s then-current base salary, net of short term disability payments remitted to Executive by the Company pursuant to the Company’s Short-Term Disability Plan, through the earlier of (y) the scheduled expiration date of the Agreement (but in no event less than 12 months from the date of disability) or (z) the date on which Executive’s long-term disability insurance payments commence. In addition, all Unvested Equity Grants, if any, shall automatically become fully vested upon termination.
 
The Agreement shall automatically terminate upon the death of Executive. In such event, provided Executive’s personal representative and the Company execute a mutual release, Executive’s personal representative shall be entitled to receive (i) Executive’s then current base salary through such date of termination, and (ii) if entitled to receive a bonus, a Pro-Rated Bonus. In addition, all Unvested Equity Grants, if any, shall automatically become fully vested upon termination.
 
Upon Executive’s termination without cause or for good reason, the Company agrees to pay Executive, in lump sum, one year’s COBRA premiums for continuation of health and dental coverage in existence at the time of such termination.
 
In the event of a termination of Executive’s employment by the Company without cause or by Executive for good reason, or notice by the Company of non-renewal of the Agreement, all within 365 days of a consummation of a change in control of the Company and provided that Executive and the Company execute a mutual release, Executive shall be entitled to receive (i) Executive’s then current base salary through the effective date of such termination or non-renewal, (ii) if entitled to receive a bonus , a Pro-Rated Bonus, (iii) a lump sum payment equal to 24 months of Executive’s then current base salary plus an amount equal to the cash bonus paid to Executive in the prior calendar year, if any, and (iv) full vesting of all Unvested Equity Grants, if any. A change in control shall mean an event or series of events by which: (A) any person or group (as such terms are used in Sections 13(d) and 14(d) of


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the Exchange Act, but excluding any employee benefit plan of such person or its subsidiaries, and any person or entity acting in its capacity as trustee, agent, or other fiduciary or administrator of any such plan) becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of 35% or more of the equity securities of the Company entitled to vote for members of the board or equivalent governing body of the Company on a fully-diluted basis; or (B) during any period of 24 consecutive months, a majority of the members of the board or other equivalent governing body of the Company cease to be composed of individuals (1) who were members of that board or equivalent governing body on the first day of such period, (2) whose election or nomination to that board or equivalent governing body was approved by individuals referred to in clause (1) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body, or (3) whose election or nomination to that board or other equivalent governing body was approved by individuals referred to in clauses (1) and (2) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body (excluding, in the case of both clause (2) and clause (3), any individual whose initial nomination for, or assumption of office as, a member of that board or equivalent governing body occurs as a result of an actual or threatened solicitation of proxies or consents for the election or removal of one or more directors by any person or group other than a solicitation for the election of one or more directors by or on behalf of the board); or (C) any person or two or more persons acting in concert shall have acquired, by contract or otherwise, control over the equity securities of the Company entitled to vote for members of the board or equivalent governing body of the Company on a fully-diluted basis (and taking into account all such securities that such person or group has the right to acquire pursuant to any option right) representing 51% or more of the combined voting power of such securities; or (D) the Company sells or transfers (other than by mortgage or pledge) all or substantially all of its properties and assets to, another person or group (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act).
 
The following table illustrates the payments and benefits due to each of Messrs. T. Boyd and Mueller assuming that the termination or change in control took place on the last business day of the Company’s last completed fiscal year.
 
                                                                       
                                          Termination
                                          in
                        Termination
                Connection
            Termination
    Termination
    Without
    Termination
    Termination
    with
      Termination
    Without
    For Good
    Good
    Due to
    Due to
    Change in
      For Cause     Cause     Reason     Reason     Disability     Death     Control
Timothy D. Boyd
            $ 899,262       $ 899,262               $ 1,326,000               $ 899,262  
 
Stephen J. Mueller
            $ 842,165       $ 842,165               $ 1,248,000               $ 842,165  
 


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PRINCIPAL STOCKHOLDERS
 
The following table shows the amount of our common stock beneficially owned as of June 1, 2011 prior to the offering and after giving effect to this offering by (i) each person who is known by us to own beneficially more than 5% of our common stock, (ii) each member of the board of directors, (iii) each of the named executive officers and (iv) all members of the board of directors and the executive officers, as a group. A person is a “beneficial owner” of a security if that person has or shares voting or investment power over the security or if he or she has the right to acquire beneficial ownership within 60 days. Unless otherwise noted, these persons, to our knowledge, have sole voting and investment power over the shares listed. Percentage computations are based on 6,969,200 shares of our common stock outstanding as of June 1, 2011, giving effect to the anticipated 175 for 1 stock split. In addition, all other information presented in the table below has been adjusted to reflect the anticipated 175 for 1 stock split. Except as otherwise noted, the principal address for the stockholders listed below is c/o Peak Resorts, Inc., 17409 Hidden Valley Drive, Wildwood, Missouri 63025.
 
                         
      Shares Beneficially Owned
    Shares Beneficially Owned
Name     Prior to This Offering     After This Offering
      Number     Percent     Number     Percent
 
Timothy D. Boyd(1)
    2,232,650     32.0%        
 
Stephen J. Mueller
    855,925     12.3%        
 
Richard Deutsch
    845,950     12.1%        
 
Jesse K. Boyd(2)
    106,750     1.5%        
 
James T. Barry, Jr. 
    --     --        
 
Gregory R. Diekemper
    --     --        
 
Stanley W. Hansen
    --     --        
 
Michael Staenberg
    --     --        
 
Glenn E. Boyd, Jr.(3)
    567,700     8.1%            
 
Robin B. Graham(4)
    954,275     13.7%        
 
David Grenier(5)
    366,800     5.3%        
 
All named directors
and executive officers
as a group (8 persons)
    4,041,275     58.0%        
 
 
(1) Includes 1,515,150 shares held by Mr. T. Boyd as Trustee of the Timothy D. Boyd Revocable Trust, dated August 27, 1996. This amount also includes 188,300 shares held by Mr. T. Boyd’s wife, Melissa K. Boyd, as Trustee of the Timothy D. Boyd 2011 Family Trust u/a, dated January 28, 2011, and 529,200 shares held by Ms. Boyd as Trustee of the Melissa K. Boyd Revocable Trust, dated August 27, 1996. Ms. Boyd has sole voting and investment power as Trustee.
 
(2) Includes 101,500 shares held by Mr. J. Boyd in his name and 5,250 shares held by Mr. J. Boyd and Jessica Boyd, his wife, as tenants by the entirety over which they share voting and investment power.
 
(3) Includes 567,700 shares held by Glenn Edward Boyd and Vickie L. Boyd, Trustees of the 2001 Boyd Family Trust u/a November 30, 2011, over which Mr. G. Boyd and Ms. V. Boyd share voting and investment power. Mr. G. Boyd’s principal address is 15732 Los Gatos Boulevard, #406, Los Gatos, California 95032.
 
(4) Includes 461,475 shares held by Ms. Graham in her name; 101,500 shares held by Kent D. Graham, her husband, in his name; 188,300 shares held by Mr. Graham as Trustee of the Robin B. Graham Family Trust u/a, dated January 28, 2011; 101,500 shares held by Kent and Robin Graham as Co-Trustees of the Boyd Family Trust, f/b/o Ashley E. Graham, dated November 27, 1996; and 101,500 shares held by Kent and Robin Graham as Co-Trustees of the Boyd Family Trust, f/b/o Lauren G. Graham, dated November 27, 1996. Mr. Graham has sole voting and investment power over the shares he owns in his name and as Trustee, and Mr. and Ms. Graham share voting and investment power over those shares for which they serve as Co-Trustees. The principal address for Ms. Graham is c/o Attitash Ski Area, P.O. Box 308, Bartlett, New Hampshire 03812.
 
(5) Includes 366,800 shares held by David Grenier and Linda S. Grenier, or their Successor(s) as Trustee(s) of the David Grenier Living Trust, dated August 11, 1994, over which Mr. and Ms. Grenier share voting and investment power. Mr. Grenier’s principal address is c/o Snow Creek Ski Area, P.O. Box 567, Weston, Missouri 64098.


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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
 
Resort Holdings, L.L.C. is a limited liability company previously owned by Timothy Boyd and Stephen Mueller, two of our named executive officers and directors. Mr. Boyd and Mr. Mueller each owned 50% of the interests of Resort Holdings, L.L.C.
 
In 2005, the Company loaned Resort Holdings, L.L.C. approximately $374,000 to purchase a home in Pennsylvania near the Jack Frost and Big Boulder resorts. The loan accrued interest at a rate of 6.5%, payable in installments of $1,900 per month for 30 years. On April 1, 2010, the Company and Resort Holdings, L.L.C. entered into a lease pursuant to which the Company leased the home from Resort Holdings, L.L.C. for $33,600 per year for business purposes.
 
In 2007, Resort Holdings, L.L.C. purchased a condominium in Vermont. The Company loaned Resort Holdings, L.L.C. approximately $398,000 to purchase this condominium. The loan was payable monthly over 30 years at an interest rate of 6.5%. On September 1, 2010, the Company began leasing the condominium from Resort Holdings, L.L.C. for business purposes for $48,000 per year pursuant to a lease agreement.
 
Subsequent to the purchase of the Vermont condominium in 2007, Resort Holdings, L.L.C. received a mortgage from a third party financial institution and paid down the aggregate loan amount owed to the Company.
 
Information relating to the principal amounts outstanding and payments made on the loan during the periods presented below is as follows:
 
                         
    Fiscal Year Ended April 30,  
    2011     2010     2009  
 
Largest aggregate amount of
principal outstanding
  $ 141,000     $ 103,000     $ 119,000  
Amount of principal paid
    153,000       17,000       16,000  
Amount of interest paid
    6,000       6,000       7,000  
 
Effective as of April 1, 2011, the Company entered into a Limited Liability Company Membership Interest Sale and Assignment Agreement with each of Messrs. Boyd and Mueller, pursuant to which the Company agreed to purchase the membership interests of Resort Holdings, L.L.C. owned by Messrs. Boyd and Mueller, which constitute all of the outstanding membership interests of Resort Holdings, L.L.C. The total purchase price was $27,869 to each of Messrs. Boyd and Mueller, or an aggregate of $55,738. As a result of these transactions, Resort Holdings, L.L.C. became a wholly-owned subsidiary of the Company. The outstanding liabilities of Resort Holdings, L.L.C. include approximately $473,000 due on the mortgage relating to the properties. The disinterested members of the board of directors, including the audit committee members, reviewed the facts relating to the Resort Holdings, L.L.C. transaction and ratified the Company’s purchase of Resort Holdings, L.L.C.
 
On October 30, 2007, the Company and certain of its subsidiaries entered into an Amended and Restated Credit and Security Agreement with EPT Ski Properties, Inc. pursuant to which EPT Ski Properties, Inc. provided the Company with a $31 million operating loan. This amount was later increased to $41 million upon the execution of the Second Amended and Restated Promissory Note, dated August 5, 2008. Messers Boyd and Mueller and Richard Deutsch, another of our named executive officers and directors, executed a Consent and Agreement of Guarantors on October 30, 2007 pursuant to which they each personally guaranteed payment of the amount due by the Company under, and satisfaction of all other obligations pursuant to, the Amended and Restated Credit and Security Agreement. The largest aggregate amount of principal outstanding under the Amended and Restated Credit and Security Agreement was $32.2 million during each of the fiscal years ended April 30, 2011, 2010 and 2009. As of April 30, 2011, the Company owed $32.2 million under the Amended and Restated Credit and Security Agreement. There were no required principal payments on the outstanding loan amount under the Amended and Restated Credit and Security Agreement during the fiscal years ended April 30, 2011, 2010 and 2009, but the Company made payments of $3.0 million of interest on the outstanding loan amount during each of these periods. The Company currently pays interest at a rate of 9.54% on the outstanding balance owed under the Amended and Restated Credit and Security Agreement.


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The Company has occasionally extended credit to Mr. Deutsch for personal expenses, subject to his repayment. During fiscal 2011, 2010 and 2009, the largest aggregate amounts of principal outstanding on this debt were approximately $105,000, $135,200 and $158,400, respectively. Mr. Deutsch made payments on the principal amount of the outstanding debt in the amounts of approximately $105,000, $30,350 and $30,350 during fiscal years 2011, 2010 and 2009, respectively. No interest payments were made during fiscal years 2011, 2010 and 2009. On April 12, 2011, Mr. Deutsch repaid this outstanding debt in full.
 
Policies and Procedures for Related Party Transactions
 
As provided by the audit committee’s charter, the audit committee must review and approve all transactions between the Company and any related person that are required to be disclosed pursuant to Item 404 of Regulation S-K. “Related person” and “transaction” shall have the meanings given to such terms in Item 404 of Regulation S-K, as amended from time to time. In determining whether to approve or ratify a particular transaction, the audit committee will take into account any factors it deems relevant.


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DESCRIPTION OF CAPITAL STOCK
 
The following discussion summarizes the material terms of the common stock to be issued in connection with the public offering contemplated by this Prospectus. This discussion does not purport to be complete and is qualified in its entirety by reference to our amended and restated articles of incorporation and our amended and restated by-laws, copies of which have been filed as exhibits to the registration statement of which this Prospectus forms a part.
 
Authorized capital stock
 
Our authorized capital stock consists of 20,000,000 shares of common stock, par value $0.01 per share. As of • , we had outstanding shares of common stock, held of record by •  stockholders.
 
The common stock has the voting rights described below under “—Voting,” and the dividend rights described below under “—Dividends.” Holders of common stock do not have conversion or redemption rights or any preemptive rights to subscribe for any of our unissued securities.
 
Voting
 
Holders of common stock are entitled to one vote per share on all matters to be voted on by the stockholders.
 
Dividends
 
Holders of common stock are entitled to receive such dividends and other distributions in cash, stock or property of the Company when, as, and if declared by the board of directors out of assets or funds of the Company legally available therefor.
 
Anti-Takeover Effects of Certain Provisions of Our Amended and Restated Articles of Incorporation and Amended and Restated By-laws
 
Certain provisions of our amended and restated articles of incorporation and amended and restated by-laws may have anti-takeover effects. These provisions are intended to avoid costly takeover battles, reduce our vulnerability to a hostile change of control and enhance the ability of our board of directors to maximize stockholder value in connection with any unsolicited offer to acquire us. However, these anti-takeover provisions, which are summarized below, could also discourage, delay or prevent (i) the merger or acquisition of our Company by means of a tender offer, a proxy contest or otherwise, that a stockholder may consider in its best interest, and (ii) the removal of incumbent officers and directors.
 
  •   Removal of Directors; Vacancies.  Our amended and restated by-laws provide that a director may be removed from office (i) by action of a majority of the board only if such director fails to meet the qualifications for director as stated in the amended and restated by-laws or is in breach of any agreement between such director and the Company relating to his or her services as a director or employee of the Company, or (ii) by a vote of at least 662/3% of the shares then entitled to vote in the election of directors, voting as a single class. A vacancy on the board of directors may be filled only by a majority of the remaining directors in office.
 
  •   No Cumulative Voting.  Our amended and restated articles of incorporation prohibit cumulative voting.
 
  •   Calling of Special Meetings of Stockholders.  The amended and restated by-laws provide that special meetings of the stockholders may only be called by the chairman of the board, the president of the Company, or by resolution of the board of directors upon a vote of at least 75% of all shares issued and outstanding and entitled to vote at the special meeting.
 
  •   Advance Notice Requirements for Stockholder Proposals and Director Nominations.  Our amended and restated bylaws establish an advance notice procedure for stockholder proposals to be brought before an annual meeting of our stockholders, including proposed nominations of persons for election to the board of directors. Stockholders at an annual meeting will only be able to


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  consider proposals or nominations specified in the notice of meeting or brought before the meeting by or at the direction of the board of directors or by a stockholder who was a stockholder of record on the record date for the meeting, who is entitled to vote at the meeting and who has given our secretary timely written notice, in proper form, of the stockholder’s intention to bring that business before the meeting.
 
  •   Amendment of Amended and Restated By-laws.  Our amended and restated by-laws can only be amended by the board of directors.
 
Warrant
 
In connection with the initial public offering of our common stock, we have agreed to issue to the underwriters a warrant to purchase up to an aggregate of •  shares of common stock at an exercise price of $ •  per share, assuming an initial public offering price of $ •  per share, which is the mid-point of the range listed above. The warrant is exercisable commencing on the first anniversary of the effective date of this offering and ending on the fifth anniversary of the effective date of this offering. The warrant agreement provides for a one-time demand registration right and piggy-back registration rights for a period of four years, beginning one year from the date of this Prospectus. The warrant agreement also provides for anti-dilution rights, such that the amount of common stock underlying the warrant will be adjusted to reflect stock dividends, splits and recapitalizations. According to the warrant agreement, the exercise price of the warrant will be adjusted proportionately to reflect stock dividends, split-ups, consolidations, combinations, reclassifications, reorganizations or other similar events.
 
Listing
 
We have applied to have the common stock listed on the NASDAQ Global Market under the symbol “PEAK”.
 
Transfer Agent
 
We have appointed Computershare Investor Services as the transfer agent and registrar for the common stock.


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SHARES ELIGIBLE FOR FUTURE SALE
 
Prior to this offering, there has been no public market for our common stock, and we cannot predict what effect, if any, market sales of shares of common stock or the availability of shares of common stock for sale will have on the market price of our common stock. Future sales of substantial amounts of our common stock in the public market, or the perception that substantial sales may occur, could materially and adversely affect the prevailing market price of our common stock and could impair our future ability to raise capital through the sale of our equity at a time and price we deem appropriate.
 
Upon completion of this offering, we will have •  shares of common stock outstanding. Of these shares of common stock, the •  shares of common stock being sold in this offering will be freely tradable without restriction under the Securities Act, except for any such shares which may be held or acquired by an “affiliate” of ours, as that term is defined in Rule 144 promulgated under the Securities Act, which shares will be subject to the volume limitations and other restrictions of Rule 144 described below. The remaining •  shares of common stock held by our existing stockholders upon completion of this offering will be “restricted securities,” as that phrase is defined in Rule 144, and may be resold only after registration under the Securities Act or pursuant to an exemption from such registration, including, among others, the exemptions provided by Rule 144 of the Securities Act, which is summarized below. Taking into account the lock-up agreements described below and the provisions of Rule 144, additional shares of our common stock will be available for sale in the public market as follows:
 
  •   • shares of restricted securities will be available for sale at various times after the date of this Prospectus pursuant to Rule 144; and
 
  •   • shares subject to the lock-up agreements will be eligible for sale at various times beginning 180 days after the date of this Prospectus pursuant to Rule 144.
 
Rule 144
 
The availability of Rule 144 will vary depending on whether shares of our common stock are restricted and whether they are held by an affiliate or a non-affiliate. For purposes of Rule 144, a non-affiliate is any person or entity that is not our affiliate at the time of sale and has not been our affiliate during the preceding three months.
 
In general, under Rule 144, once we have been a reporting company subject to the reporting requirements of Section 13 or Section 15(d) of the Exchange Act for at least 90 days, an affiliate who has beneficially owned shares of our restricted common stock for at least six months would be entitled to sell within any three-month period any number of such shares that does not exceed the greater of:
 
  •   1% of the number of shares of our common stock then outstanding, which will equal approximately • shares immediately after consummation of this offering; or
 
  •   the average weekly trading volume of our common stock on the open market during the four calendar weeks preceding the filing of a notice on Form 144 with respect to that sale.
 
In addition, any sales by our affiliates under Rule 144 are subject to manner of sale provisions and notice requirements and to the availability of current public information about us. Our affiliates must comply with all the provisions of Rule 144 (other than the six-month holding period requirement) in order to sell shares of our common stock that are not restricted securities, such as shares acquired by our affiliates either in this offering or through purchases in the open market following this offering. An “affiliate” is a person that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, an issuer.
 
Similarly, once we have been a reporting company for at least 90 days, a non-affiliate who has beneficially owned shares of our restricted common stock for at least six months would be entitled to sell those shares without complying with the volume limitation, manner of sale and notice provisions of Rule 144, provided that certain public information is available. Furthermore, a non-affiliate who has beneficially owned our shares of restricted common stock for at least one year will not be subject to any restrictions under Rule 144 with respect to such shares, regardless of how long we have been a reporting company.


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We are unable to estimate the number of shares that will be sold under Rule 144 since this will depend on the market price for our common stock, the personal circumstances of the stockholder and other factors.
 
Lock-Up Agreements
 
We and our officers, directors and holders of all of our common stock have agreed with the underwriters not to offer, pledge, sell, contract to sell, grant, lend or otherwise transfer or dispose of any shares of our common stock or securities convertible into or exchangeable for shares of our common stock, subject to specified limited exceptions and extensions described elsewhere in this Prospectus, during the period continuing through the date that is 180 days (subject to extension) after the date of this Prospectus, except with the prior written consent of Rodman & Renshaw, LLC, on behalf of the underwriters. See “Underwriting.” Rodman & Renshaw, LLC may release any of the securities subject to these lock-up agreements at any time without notice.
 
Immediately following the consummation of this offering, stockholders subject to lock-up agreements will hold •  shares of our common stock, representing about • % of our outstanding shares of common stock after giving effect to this offering.


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MATERIAL UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS TO
NON-UNITED STATES HOLDERS
 
The following is a summary of material United States federal income tax consequences of the purchase, ownership and disposition of our common stock to a non-United States holder that purchases shares of our common stock in this offering. For purposes of this summary, a “non-United States holder” means a beneficial owner of our common stock that is, for United States federal income tax purposes:
 
  •   a nonresident alien individual;
 
  •   a foreign corporation (or an entity treated as a foreign corporation for United States federal income tax purposes); or
 
  •   a foreign estate or foreign trust.
 
In the case of a holder that is classified as a partnership for United States federal income tax purposes, the tax treatment of a partner in such partnership generally will depend upon the status of the partner and the activities of the partner and the partnership. If you are a partner in a partnership holding our common stock, we urge you to consult your own tax advisor.
 
This summary is based upon the provisions of the United States Internal Revenue Code of 1986, as amended, which we refer to as the Code, the related Treasury regulations and applicable administrative and judicial interpretations, all as of the date of this Prospectus. Those authorities may change, perhaps retroactively, so as to result in United States federal income tax consequences different than those summarized below. We cannot assure you that a change in law will not alter significantly the tax considerations that we describe in this summary. We have not sought and do not plan to seek any ruling from the United States Internal Revenue Service, which we refer to as the IRS, with respect to statements made and the conclusions reached in the following summary, and there can be no assurance that the IRS or a court will agree with our statements and conclusions.
 
This summary does not address all aspects of United States federal income and estate taxes that may be relevant to non-United States holders in light of their personal circumstances and does not deal with federal taxes other than the United States federal income and estate taxes or with state, local or non-United States tax considerations. Special rules, not discussed here, may apply to certain non-United States holders, including:
 
  •   United States expatriates;
 
  •   controlled foreign corporations;
 
  •   passive foreign investment companies;
 
  •   corporations that accumulate earnings to avoid United States federal income tax; and
 
  •   investors in pass-through entities that are subject to special treatment under the Code.
 
Such non-United States holders are urged to consult their own tax advisors to determine the United States federal, state, local and other tax consequences that may be relevant to them.
 
This summary applies only to a non-United States holder that holds our common stock as a capital asset (generally property held for investment).
 
If you are considering the purchase of our common stock, we urge you to consult your own tax advisor concerning the United States federal income and estate tax consequences to you of the purchase, ownership and disposition of our common stock, as well as the consequences to you arising under United States tax laws other than the federal income and estate tax law or under the laws of any other taxing jurisdiction, in light of your particular circumstances.
 
Dividends
 
We do intend to pay cash distributions on our common stock on a quarterly basis, subject to the availability of funds. See “Dividend Policy.” Distributions on our common stock will constitute dividends for United States federal income tax purposes to the extent paid from our current or accumulated earnings and profits, as determined


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under United States federal income tax principles. Distributions in excess of both our current and accumulated earnings and profits will constitute a return of capital that reduces (but not below zero) the non-United States holder’s adjusted tax basis in our common stock. Any remaining excess will be treated as gain realized on the sale or other disposition of our common stock and will be treated as described under “Gain on Disposition of Common Stock” below. Dividends paid to a non-United States holder generally will be subject to withholding of United States federal income tax at a 30% rate, or such lower rate as may be specified by an applicable income tax treaty, of the gross amount of the dividends paid. However, dividends that are effectively connected with the conduct of a trade or business by the non-United States holder within the United States (and, if required by an applicable income tax treaty, are attributable to a United States permanent establishment of the non-United States holder) are not subject to the withholding tax, provided certain certification and disclosure requirements are satisfied (usually by providing us with an IRS Form W-8ECI). Instead, such dividends are subject to United States federal income tax on a net income basis in the same manner as if the non-United States holder were a United States person as defined under the Code. Any such effectively connected dividends received by a foreign corporation may be subject to an additional “branch profits tax” at a 30% rate or such lower rate as may be specified by an applicable income tax treaty. If we are a “United States real property holding company” (a “USRPHC”), as described below, distributions (or portions of distributions) to non-United States holders that are not dividends will be subject to withholding of United States federal income tax at a rate of 10%. However, a non-United States holder may be able to claim a refund of such withheld tax imposed on a return of capital distribution (up to its adjusted tax basis in our shares) by filing a timely United States federal income tax return.
 
A non-United States holder of our common stock who wishes to claim the benefit of an applicable treaty rate and avoid backup withholding, as discussed below, for dividends will be required (a) to complete IRS Form W-8BEN (or other applicable form) and certify under penalty of perjury that such holder is not a United States person as defined under the Code and is eligible for treaty benefits or (b) if our common stock is held through certain foreign intermediaries, to satisfy the relevant certification requirements of applicable Treasury regulations. Special certification and other requirements apply to certain non-United States holders that are pass-through entities rather than corporations or individuals.
 
A non-United States holder of our common stock eligible for a reduced rate of United States withholding tax pursuant to an income tax treaty may obtain a refund of any excess amounts withheld by timely filing an appropriate claim for refund with the IRS.
 
Gain on Disposition of Common Stock
 
A non-United States holder generally will not be subject to United States federal income tax with respect to gain realized on the sale or other taxable disposition of our common stock, unless:
 
  •   the gain is effectively connected with a trade or business conducted by the non-United States holder in the United States (and, if required by an applicable income tax treaty, is attributable to a United States permanent establishment of the non-United States holder);
 
  •   if the non-United States holder is an individual, such non-United States holder is present in the United States for 183 days or more in the taxable year of the sale or other taxable disposition, and such non-United States holder has a “tax home” (as defined in the Code) in the United States; or
 
  •   we are or have been a USRPHC for United States federal income tax purposes at any time during the shorter of the period that the non-United States holder held our common stock and the five-year period ending on the date the non-United States holder disposes of our common stock.
 
Unless an applicable income tax treaty provides otherwise, a non-United States holder who has gain that is described in the first bullet point immediately above will be subject to tax on the net gain derived from the sale or other taxable disposition under regular graduated United States federal income tax rates in the same manner as if it were a United States person as defined under the Code. In addition, a non-United States holder described in the first bullet point immediately above that is a foreign corporation may be subject to the branch profits tax equal to 30% of its effectively connected earnings and profits that are not reinvested in its United States trade or business or at such lower rate as may be specified by an applicable income tax treaty.


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An individual non-United States holder who is described in the second bullet point immediately above will be subject to a flat 30% tax on the gain recognized from the sale or other taxable disposition (or such lower rate as may be specified by an applicable income tax treaty), which may be offset by certain United States-source capital losses. We urge non-United States holders to consult any potentially applicable income tax treaties that may provide for different rules.
 
With respect to the third bullet point above, generally a corporation is a USRPHC if the fair market value of its United States real property interests (net of certain debt secured by such real property) equals or exceeds 50% of the sum of the fair market value of its worldwide real property interests and its other assets used or held for use in a trade or business (net of certain debt secured by such real property and other assets). We have not determined whether we are a USRPHC, but we believe that we are now likely a USRPHC and likely will remain a USRPHC for the foreseeable future. However, so long as our common stock continues to be “regularly traded on an established securities market,” a non-United States holder will be taxable on gain recognized on the sale or other taxable disposition of our common stock only if the non-United States holder actually or constructively holds or held more than 5% of our common stock at any time during the five-year period ending on the date of disposition or, if shorter, the non-United States holder’s holding period for our common stock. If our common stock ceases to be regularly traded on an established securities market, and we are or have been a USRPHC during the five-year period ending on the date of disposition or, if shorter, the non-United States holder’s holding period for our common stock, all non-United States holders would be subject to United States federal income tax on a disposition of our common stock. There can be no assurance that our common stock will continue to be regularly traded on an established securities market.
 
We urge non-United States holders to consult their tax advisors with respect to the application of the foregoing rules to their ownership and disposition of our common stock.
 
Federal Estate Tax
 
Our common stock that is owned (or treated as owned) by an individual who is not a citizen or resident of the United States (as specially defined for United States federal estate tax purposes) at the time of death will be included in such individual’s gross estate for United States federal estate tax purposes, unless an applicable estate or other tax treaty provides otherwise, and, therefore, may be subject to United States federal estate tax.
 
Information Reporting and Backup Withholding Tax
 
We must report annually to the IRS and to each non-United States holder the amount of dividends paid to such holder and the tax withheld with respect to such dividends, regardless of whether withholding was required. Copies of the information returns reporting such dividends and withholding may also be made available to the tax authorities in the country in which the non-United States holder resides under the provisions of an applicable income tax treaty or agreement.
 
A non-United States holder will be subject to backup withholding (currently at a 28% rate of tax) for dividends paid to such holder unless such holder certifies under penalty of perjury that it is a non-United States holder (and the payor does not have actual knowledge or reason to know that such holder is a United States person as defined under the Code), or such holder otherwise establishes an exemption.
 
Information reporting and, depending on the circumstances, backup withholding will apply to the proceeds of a sale of our common stock within the United States or conducted through certain United States-related financial intermediaries, unless the beneficial owner certifies under penalty of perjury that it is a non-United States holder (and the payor does not have actual knowledge or reason to know that the beneficial owner is a United States person as defined under the Code), or such owner otherwise establishes an exemption.
 
Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against a non-United States holder’s United States federal income tax liability provided the required information is timely furnished to the IRS.


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Additional Withholding Requirements
 
Recently enacted legislation imposes a United States withholding tax at a 30% rate on certain distributions and proceeds of sale in respect of shares of our common stock received by United States persons who own shares of our common stock through foreign accounts or foreign intermediaries and certain non-United States holders if certain disclosure requirements related to United States accounts or ownership are not satisfied. If payment of withholding taxes is required, non-United States holders that are otherwise eligible for an exemption from, or reduction of, United States withholding taxes with respect to such distributions and proceeds will be required to seek a refund from the IRS to obtain the benefit of such exemption or reduction. We will not pay any additional amounts in respect of any amounts withheld. These new withholding rules are generally effective for payments made after December 31, 2012.
 
THE SUMMARY OF MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES ABOVE IS INCLUDED FOR GENERAL INFORMATION PURPOSES ONLY. POTENTIAL PURCHASERS OF OUR COMMON STOCK ARE URGED TO CONSULT THEIR OWN TAX ADVISORS TO DETERMINE THE UNITED STATES FEDERAL, STATE, LOCAL AND NON-UNITED STATES TAX CONSIDERATIONS OF PURCHASING, OWNING AND DISPOSING OF OUR COMMON STOCK.


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UNDERWRITING
 
Rodman & Renshaw, LLC is acting as the sole managing underwriter of this offering. Under the terms and subject to the conditions contained in an underwriting agreement dated the date of this Prospectus, Rodman & Renshaw, LLC, or the underwriter, has agreed to purchase, and we have agreed to sell to them, all •  shares of common stock offered by this Prospectus.
 
Nature of Underwriting Commitment
 
The underwriter is offering the shares of common stock subject to its acceptance of the shares from us and subject to prior sale. The underwriting agreement provides that the obligations of the underwriter to pay for and accept delivery of the shares of common stock offered by this Prospectus are subject to the approval of certain legal matters by their counsel and to other conditions. The underwriter is obligated to take and pay for all of the shares of common stock offered by this Prospectus if any such shares are taken. However, the underwriter is not required to take or pay for the shares covered by the over-allotment option described below. The underwriter initially proposes to offer part of the shares of common stock directly to the public at the public offering price listed on the cover page of this Prospectus, less underwriting discounts and commissions, and part to certain dealers at a price that represents a concession not in excess of $ •  a share under the public offering price. After the initial offering of the shares of common stock, the offering price and other selling terms may from time to time be varied by the underwriter.
 
Option to Purchase Additional Shares
 
We have granted to the underwriter an option, exercisable for 45 days from the date of this Prospectus, to purchase up to an aggregate of •  additional shares of common stock at the public offering price, less underwriting discounts and commissions. The underwriter may exercise this option, in whole or in part, solely for the purpose of covering over-allotments, if any, made in connection with the offering of the shares of common stock offered by this Prospectus. If the over-allotment option is exercised in full, the total price to the public would be $ • , the total underwriter discounts and commissions would be $ •  and the total proceeds to us would be $ • .
 
Discounts and Commissions
 
The following table shows the per share and total underwriting discounts and commissions that we are to pay to the underwriter in connection with this offering. These amounts are shown assuming both no exercise and full exercise of the over-allotment option.
 
                         
          Total
       
    Per
    No
       
    Share     Exercise     Full Exercise  
 
Public offering price
  $  •      $  •      $  •   
Underwriting discount1
  $  •      $  •      $  •   
Non-accountable expense allowance
  $  •      $  •      $  •   
Proceeds, before expenses, to us
  $  •      $  •      $  •   
 
(1) The underwriter is also entitled to a common stock purchase warrant and expense reimbursements, as discussed below.
 
In addition, we estimate that the expenses of this offering other than underwriting discounts and commissions payable by us will be approximately $ •  million.
 
We have agreed to pay the underwriter a non-accountable expense allowance equal to 1% of the public offering price or $ • . We have also agreed to issue to the underwriter a common stock purchase warrant to purchase up to •  shares of our common stock. The warrant will have an exercise price equal to 125% of the price of the shares sold in the offering. The warrant is exercisable commencing on the first anniversary of the effective date of the offering and ending on the fifth anniversary of the effective date of this offering. The warrant is not exercisable or convertible more than five years from the effective date of this offering. The warrant also provides for unlimited “piggyback” registration rights at our expense with respect to the underlying shares of common stock. Pursuant to the rules of the Financial Industry Regulatory, Inc., or FINRA, and in particular Rule 5110, the warrant (and underlying shares) issued to the underwriter may not be sold, transferred, assigned, pledged, or hypothecated, or


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the subject of any hedging, short sale, derivative, put or call transaction that would result in the effective disposition of the securities by any person for a period of 180 days immediately following the date of delivery and payment for the shares offered; provided, however, that the warrant (and underlying shares) may be transferred to officers or partners of the underwriter as long as the warrant (and underlying shares) remains subject to the lockup.
 
We have agreed to pay the underwriter its actual and accountable out of pocket expenses related to the offering. We have also agreed that the underwriter shall have a right of first refusal for a period of twelve months from the date the offering is completed to purchase for its account or sell for the account of the Company any securities of the Company which it may seek to sell.
 
Lock-ups
 
We, all of our directors and officers and holders of our outstanding stock have agreed that, subject to specified exceptions, without the prior written consent of the underwriter, we and they will not, during the period beginning on the effective date of this offering and ending 180 days thereafter:
 
  •   offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of common stock or any securities convertible into or exercisable or exchangeable for common stock;
 
  •   enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of common stock; or
 
  •   make any demand for, or exercise any right with respect to, the registration of any shares of common stock or any security convertible into or exercisable or exchangeable for common stock;
 
whether any such transaction described above is to be settled by delivery of common stock or such other securities, in cash or otherwise.
 
The restrictions described in the preceding paragraphs do not apply to:
 
  •   the sale by us of shares to the underwriter in connection with the offering;
 
  •   the issuance by us of options or shares of stock under any stock compensation plan;
 
  •   transactions relating to shares of common stock or other securities convertible or exchangeable into common stock acquired in open market transactions after the completion of the offering of the shares; provided that no filing with the SEC shall be required or shall be made voluntarily in connection with such transaction; or
 
  •   the transfer of shares of common stock or any security convertible or exchangeable into shares of common stock as a bona fide gift, or by will or intestate succession to a member of the immediate family of our stockholders, or to a trust for the benefit of such immediate family member; provided that it shall be a condition to the transfer or distribution that the transferee provide prior written notice of such transfer or distribution to the underwriter and execute a copy of the lock-up agreement, that no filing by any donee or transferee with the SEC shall be required or shall be made voluntarily in connection with such transfer or distribution, other than a filing on Form 5, and that no such transfer or distribution may include a disposition for value.
 
The 180-day restricted period described in the preceding paragraph will be extended if:
 
  •   during the last 17 days of the 180-day restricted period we issue an earnings release or material news or a material event relating to us occurs; or
 
  •   prior to the expiration of the 180-day restricted period, we announce that we will release earnings results during the 16-day period beginning on the last day of the 180-day restricted period,
 
in which case the restrictions described in the preceding paragraph will continue to apply until the expiration of the 180-day period beginning on the issuance of the earnings release or the occurrence of the material news or material event.


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Stabilization
 
In order to facilitate this offering of common stock, the underwriter may engage in transactions that stabilize, maintain or otherwise affect the price of the common stock. Specifically, the underwriter may sell more shares than they are obligated to purchase under the underwriting agreement, creating a short position. A short sale is covered if the short position is no greater than the number of shares available for purchase by the underwriter under the over-allotment option. The underwriter can close out a covered short sale by exercising the over- allotment option or by purchasing shares in the open market. In determining the source of shares to close out a covered short sale, the underwriter will consider, among other things, the open market price of shares compared to the price available under the over-allotment option. The underwriter may also sell shares in excess of the over-allotment option, creating a naked short position. The underwriter must close out any naked short position by purchasing shares in the open market. A naked short position is more likely to be created if the underwriter is concerned that there may be downward pressure on the price of the common stock in the open market after pricing that could adversely affect investors who purchase in this offering. In addition, to stabilize the price of the common stock, the underwriter may bid for and purchase shares of common stock in the open market. These activities may raise or maintain the market price of the common stock above independent market levels or prevent or retard a decline in the market price of the common stock. The underwriter is not required to engage in these activities and may end any of these activities at any time.
 
Other Terms
 
We will apply to have our common stock approved for quotation on the NASDAQ Global Market under the symbol “PEAK”.
 
We and the underwriter have agreed to indemnify each other against certain liabilities, including liabilities under the Securities Act.
 
Prior to this offering, there has been no public market for the shares of common stock. The initial public offering price will be determined by negotiations between us and the underwriter. Among the factors to be considered in determining the initial public offering price will be our future prospects and those of our industry in general; sales, earnings and other financial operating information in recent periods; and the price-earnings ratios, price-sales ratios and market prices of securities and certain financial and operating information of companies engaged in activities similar to ours. The estimated initial public offering price range set forth on the cover page of this preliminary Prospectus is subject to change as a result of market conditions and other factors. An active trading market for the shares may not develop, and it is possible that after the offering the shares will not trade in the market above their initial offering price. A Prospectus in electronic format may be made available on a web site maintained by the underwriter, and the underwriter may distribute Prospectuses electronically.
 
Foreign Regulatory Restrictions on Purchase of Our Common Stock
 
We have not taken any action to permit a public offering of our common stock outside the U.S. or to permit the possession or distribution of this Prospectus outside the U.S. Persons outside the U.S. who come into possession of this Prospectus must inform themselves about and observe any restrictions relating to this offering and the distribution of the Prospectus outside the U.S. In addition to the public offering of our common stock in the U.S., the underwriter may, subject to applicable foreign laws, also offer our common stock to certain institutions or accredited persons in the following countries:
 
Australia
 
If this document is issued or distributed in Australia it is issued or distributed to “wholesale clients” only, not to “retail clients”. For the purposes of this paragraph, the terms “wholesale client” and “retail client” have the meanings given in section 761 of the Australian Corporations Act 2001 (Cth). This document is not a disclosure document under the Australian Corporations Act, has not been lodged with the Australian Securities & Investments Commission and does not purport to include the information required of a disclosure document under the Australian Corporations Act. Accordingly, (i) the offer of securities under this document is only made to persons to whom it is lawful to offer such securities under one or more exemptions set out in the Australian Corporations Act, (ii) this


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document is only made available in Australia to those persons referred to in clause (i) above, and (iii) the offeree must be sent a notice stating in substance that, by accepting this offer, the offeree represents that the offeree is such a person as referred to in clause (i) above, and, unless permitted under the Australian Corporations Act, agrees not to sell or offer for sale within Australia any of the securities sold to the offeree within 12 months after its transfer to the offeree under this document.
 
China
 
THIS PROSPECTUS HAS NOT BEEN AND WILL NOT BE CIRCULATED OR DISTRIBUTED IN THE PRC, AND SECURITIES MAY NOT BE OFFERED OR SOLD, AND WILL NOT BE OFFERED OR SOLD TO ANY PERSON FOR RE-OFFERING OR RESALE, DIRECTLY OR INDIRECTLY, TO ANY RESIDENT OF THE PRC EXCEPT PURSUANT TO APPLICABLE LAWS AND REGULATIONS OF THE PRC.
 
UAE
 
The offering has not been approved or licensed by the Central Bank of the United Arab Emirates (the “UAE”), Securities and Commodities Authority of the UAE and/or any other relevant licensing authority in the UAE including any licensing authority incorporated under the laws and regulations of any of the free zones established and operating in the territory of the UAE, in particular the Dubai Financial Services Authority (the “DFSA”), a regulatory authority of the Dubai International Financial Centre (the “DIFC”).
 
The offering does not constitute a public offer of securities in the UAE, DIFC and/or any other free zone in accordance with the Commercial Companies Law, Federal Law No. 8 of 1984 (as amended), DFSA Offered Securities Rules and NASDAQ Dubai Listing Rules, accordingly, or otherwise. The securities offered hereby may not be offered to the public in the UAE and/or any of the free zones, including, in particular, the DIFC.
 
The securities offered hereby may be offered and issued only to a limited number of investors in the UAE or any of its free zones (including, in particular, the DIFC) who qualify as sophisticated investors under the relevant laws and regulations of the UAE or the free zone concerned, including, in particular, the DIFC.
 
The company represents and warrants that the securities offered hereby will not be offered, sold, transferred or delivered to the public in the UAE or any of its free zones, including, in particular, the DIFC.
 
Dubai
 
The issuer is not licensed by the Dubai Financial Services Authority (“DFSA”) to provide financial services in the Dubai International Financial Centre (“DIFC”). The offering has not been approved or licensed by the Central Bank of the United Arab Emirates (the “UAE”), Securities and Commodities Authority of the UAE and/or any other relevant licensing authority in the UAE including any licensing authority incorporated under the laws and regulations of any of the free zones established and operating in the territory of the UAE, in particular the DFSA, a regulatory of the DIFC.
 
The offering does not constitute a public offer of securities in the UAE, DIFC and/or any other free zone in accordance with the Commercial Companies Law, Federal Law No. 8 of 1984 (as amended), DFSA Offered Securities Rules and NASDAQ Dubai Listing Rules, accordingly, or otherwise. The securities offered hereby may not be offered to the public in the UAE and/or any of the free zones, including, in particular, the DIFC.
 
The securities offered hereby may be offered and issued only to a limited number of investors in the UAE or any of its free zones (including, in particular, the DIFC) who qualify as sophisticated investors under the relevant laws and regulations of the UAE or the free zone concerned, including, in particular, the DIFC.
 
The company represents and warrants that the securities offered hereby will not be offered, sold, transferred or delivered to the public in the UAE or any of its free zones, including, in particular, the DIFC.
 
Israel
 
The common stock offered by this Prospectus has not been approved or disapproved by the Israeli Securities Authority (the “ISA”), nor has such common stock been registered for sale in Israel. The shares may not be offered


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or sold, directly or indirectly, to the public in Israel, absent the publication of a prospectus. The ISA has not issued permits, approvals or licenses in connection with the offering or publishing of this Prospectus; nor has it authenticated the details included herein, confirmed their reliability or completeness, or rendered an opinion as to the quality of the common stock being offered. Any resale, directly or indirectly, to the public of the common stock offered by this Prospectus is subject to restrictions on transferability and must be effected only in compliance with the Israeli securities laws and regulations.
 
Pakistan
 
The investors/subscribers in Pakistan will be responsible for ensuring their eligibility to invest under the applicable laws of Pakistan and to obtain any regulatory consents if required for such purpose.
 
Saudi Arabia
 
NO OFFERING OF SHARES IS BEING MADE IN THE KINGDOM OF SAUDI ARABIA, AND NO AGREEMENT RELATING TO THE SALE OF THE SHARES WILL BE CONCLUDED IN SAUDI ARABIA. THIS DOCUMENT IS PROVIDED AT THE REQUEST OF THE RECIPIENT AND IS BEING FORWARDED TO THE ADDRESS SPECIFIED BY THE RECIPIENT. NEITHER THE AGENT NOR THE OFFERING HAVE BEEN LICENSED BY SAUDI ARABIA’S SECURITIES AND EXCHANGE COMMISSION OR ARE OTHERWISE REGULATED BY THE LAWS OF THE KINGDOM OF SAUDI ARABIA.
 
THEREFORE, NO SERVICES RELATING TO THE OFFERING, INCLUDING THE RECEIPT OF APPLICATIONS AND/OR THE ALLOTMENT OF THE SHARES, MAY BE RENDERED WITHIN THE KINGDOM OF SAUDI ARABIA BY THE AGENT OR PERSONS REPRESENTING THE OFFERING.
 
UK
 
The content of this Prospectus has not been issued or approved by an authorised person within the meaning of the United Kingdom Financial Services and Markets Act 2000 (“FSMA”). Reliance on this Prospectus for the purpose of engaging in any investment activity may expose an investor to a significant risk of losing all of the property or other assets invested. This Prospectus does not constitute a “Prospectus” within the meaning of the FSMA and is issued in reliance upon one or more of the exemptions from the need to issue such a prospectus contained in section 86 of the FSMA.
 
VALIDITY OF COMMON STOCK
 
The validity of the shares of common stock offered hereby will be passed upon for us by Helfrey, Neiers & Jones P.C., St. Louis, Missouri. Certain legal matters in connection with this offering will be passed upon for the underwriters by Andrews Kurth LLP, Austin, Texas.
 
EXPERTS
 
The consolidated financial statements of Peak Resorts, Inc. and subsidiaries as of April 30, 2011 and 2010 and for each of the years in the three-year period ended April 30, 2011 appearing in this Prospectus and the related financial statement schedules included elsewhere in the registration statement have been audited by McGladrey & Pullen, LLP, an independent registered public accounting firm, as stated in their report appearing elsewhere in the registration statement (which report expresses an unqualified opinion on the financial statements and financial statement schedules), and are included in reliance upon such reports and upon the authority of such firm as experts in accounting and auditing.
 


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WHERE YOU CAN FIND MORE INFORMATION
 
We have filed a registration statement, of which this Prospectus is a part, on Form S-1 with the SEC relating to this offering. This Prospectus does not contain all of the information in the registration statement and the exhibits and financial statements included with the registration statement. References in this Prospectus to any of our contracts, agreements or other documents are not necessarily complete, and you should refer to the exhibits attached to the registration statement for copies of the actual contracts, agreements or documents.
 
The Company’s filings with the SEC are available to the public on the SEC’s website at http://www.sec.gov. Those filings will also be available to the public on, or accessible through, our corporate web site at http://www.peakresorts.com. The information contained on or accessible through our corporate web site or any other web site that we may maintain is not part of this Prospectus or the registration statement of which this Prospectus is a part. You may also read and copy, at SEC prescribed rates, any document we file with the SEC, including the registration statement (and its exhibits) of which this Prospectus is a part, at the SEC’s Public Reference Room located at 100 F Street, N.E., Washington D.C. 20549. You can call the SEC at 1-800-SEC-0330 to obtain information on the operation of the Public Reference Room. You may also request a copy of these filings, at no cost, by writing to us at 17409 Hidden Valley Drive, Wildwood, Missouri 63025 or telephoning us at (636) 938-7474.
 
Upon the effectiveness of the registration statement, we will be subject to the informational requirements of the Exchange Act and, in accordance with the Exchange Act, will file periodic reports, proxy and information statements and other information with the SEC. Such annual, quarterly and current reports; proxy and information statements; and other information can be inspected and copied at the locations set forth above. We will report our financial statements on a year ended April 30. We intend to furnish our stockholders with annual reports containing consolidated financial statements audited by our independent registered public accounting firm and will post on our website our quarterly reports containing unaudited consolidated financial statements for each of the first three quarters of each fiscal year.


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(mcgladrey logo)
 
Report of Independent Registered Public Accounting Firm
 
To the Board of Directors
Peak Resorts, Inc. and Subsidiaries
Wildwood, Missouri
 
We have audited the accompanying consolidated balance sheets of Peak Resorts, Inc. and Subsidiaries as of April 30, 2011 and 2010, and the related consolidated statements of earnings (loss), stockholders’ equity and comprehensive income and cash flows for the years ended April 30, 2011, 2010 and 2009. Our audits also included the financial statement schedules of Peak Resorts, Inc. and Subsidiaries listed in Item 16(b). These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.
 
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
 
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Peak Resorts, Inc. and Subsidiaries as of April 30, 2011 and 2010, and the results of their operations and their cash flows for the years ended April 30, 2011, 2010 and 2009 in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedules, when considered in the relation to the basic consolidated financial statements taken as a whole, present fairly in all material respects the information set forth therein.
 
As discussed in Note 5 to the financial statements, the Company terminated its S-corporation election effective April 30, 2011. Prior to April 30, 2011, federal and most state income taxes were not required to be recognized. As of April 30, 2011, the Company will now be responsible for corporate income taxes and has reported the impact of deferred income taxes for book and tax bases differences.
 
/s/ McGladrey & Pullen, LLP
 
St. Louis, Missouri
June 10, 2011


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Peak Resorts Inc. and Subsidiaries
Consolidated Balance Sheets
April 30,
 
                 
    2011     2010  
 
Assets
               
Current assets
               
Cash and cash equivalents
  $ 16,463,200     $ 19,508,100  
Restricted cash balances
    11,271,400       11,138,800  
Marketable securities
    -       305,600  
Accounts receivable (no allowance for doubtful accounts considered necessary)
    906,400       903,800  
Inventory
    1,329,600       1,431,500  
Deferred Income tax
    875,000       -  
Prepaid incremental stock issuance cost
    468,700       -  
Prepaid expenses and other current assets
    973,100       891,300  
                 
Total current assets
    32,287,400       34,179,100  
Property and equipment, net
    117,801,300       109,146,000  
Land held for development
    27,997,800       24,525,200  
Other assets, including related party amounts
    2,434,600       2,403,700  
                 
Total Assets
  $ 180,521,100     $ 170,254,000  
                 
Liabilities and Stockholders’ Equity
               
Current liabilities
               
Accounts payable and accrued expenses
  $ 3,140,000     $ 2,998,000  
Accrued stockholder distributions
    1,126,900       -  
Accrued interest
    1,264,000       1,250,200  
Accrued salaries, wages and related taxes and benefits
    1,560,300       1,566,000  
Unearned revenue
    4,577,700       5,785,800  
Current portion of long-term debt and capitalized lease obligation
    34,767,000       586,900  
                 
Total current liabilities
    46,435,900       12,186,900  
Long-term debt
    107,624,000       136,608,200  
Capitalized lease obligation
    1,667,000       1,425,500  
Deferred gain on sale/leaseback
    5,175,600       5,508,400  
Deferred income tax
    11,285,000       -  
Other liabilities
    756,000       792,000  
Commitments and Contingencies (Refer to Note 10)
               
Stockholders’ Equity
               
Common stock, $.01 and $1 par value, respectively; 20,000,000 and 60,000 shares authorized, respectively; 39,824 and 44,757 shares issued, respectively
    398       44,757  
Additional paid-in capital
    424,826       385,400  
Retained earnings
    7,152,376       13,566,000  
Accumulated other comprehensive income
    -       191,600  
                 
      7,577,600       14,187,757  
Less: shares in treasury (4,933 shares at cost in 2010)
    -       454,757  
                 
      7,577,600       13,733,000  
                 
Total Liabilities and Stockholders’ Equity
  $ 180,521,100     $ 170,254,000  
                 
 
See notes to consolidated financial statements.


F-3


Table of Contents

 
Peak Resorts, Inc. and Subsidiaries
Consolidated Statements of Earnings (Loss)
Years ended April 30,
 
                         
    2011     2010     2009  
 
Resort Revenues
  $ 97,586,100     $ 89,845,800     $ 84,292,700  
Costs and Expenses
                       
Resort operating expenses
    66,740,200       62,572,100       61,846,200  
Depreciation and amortization
    8,054,100       7,544,500       6,813,300  
General and administrative expenses
    2,129,200       2,402,800       2,069,700  
Land and building rent
    1,948,200       1,857,500       1,834,700  
Real estate and other taxes
    1,945,600       1,697,300       1,828,700  
                         
      80,817,300       76,074,200       74,392,600  
                         
Earnings from Operations
    16,768,800       13,771,600       9,900,100  
Other Income (Expense)
                       
Interest, net of $2,596,100, $2,205,300 and $2,069,800 capitalized in 2011, 2010 and 2009, respectively
    (11,338,100 )     (11,369,500 )     (10,817,800 )
Gain on sale/leaseback
    332,800       332,800       332,800  
Gain on acquisition
    399,900       -       -  
Other
    -       -       (176,300 )
Investment income
    240,700       98,000       269,000  
                         
      (10,364,700 )     (10,938,700 )     (10,392,300 )
                         
Taxable Income (Loss)
    6,404,100       2,832,900       (492,200 )
Income Tax Provision
    10,410,000       -       -  
                         
Net Earnings (Loss)
  $ (4,005,900 )   $ 2,832,900     $ (492,200 )
                         
Basic and diluted earnings (loss) per share
  $ (100.59 )   $ 71.14     $ (12.36 )
                         
Historical earnings (loss) before income taxes
  $ 6,404,100     $ 2,832,900     $ (492,200 )
Pro forma provision (benefit) for income taxes
    2,546,000       1,208,000       (8,000 )
                         
Pro forma net earnings (loss)
    3,858,100       1,624,900       (484,200 )
                         
Pro forma basic and diluted earnings (loss) per share
  $ 96.88     $ 40.80     $ (12.16 )
                         
 
See notes to consolidated financial statements.


F-4


Table of Contents

 
Peak Resorts Inc. and Subsidiaries
Consolidated Statements of Stockholders’ Equity
Years Ended April 30, 2011, 2010 and 2009
 
                                                                 
                                  Accumulated
             
                Additional
                Other
             
    Common Stock     Paid-in
    Retained
    Treasury
    Comprehensive
          Comprehensive
 
    Shares     Dollars     Capital     Earnings     Stock     Income     Total     Income (loss)  
 
Balances, May 1, 2008
    44,757       $44,757       $385,400       $11,913,700       $(454,757 )     $-       $11,889,100       -  
Net Loss
    -       -       -       (492,200 )     -       -       (492,200 )     $(492,200 )
Distributions to Stockholders
    -       -       -       (342,400 )     -       -       (342,400 )     -  
Unrealized gain on available-for-sale securities
    -       -       -       -       -       54,500       54,500       54,500  
                                                                 
                                                              $(437,700 )
                                                                 
Balances, April 30, 2009
    44,757       44,757       385,400       11,079,100       (454,757 )     54,500       11,109,000       -  
Net Earnings
    -       -       -       2,832,900       -       -       2,832,900       $2,832,900  
Distributions to Stockholders
    -       -       -       (346,000 )     -       -       (346,000 )     -  
Unrealized gain on available-for-sale securities
    -       -       -       -       -       137,100       137,100       137,100  
                                                                 
                                                              $2,970,000  
                                                                 
Balances, April 30, 2010
    44,757       44,757       385,400       13,566,000       (454,757 )     191,600       13,733,000       -  
Net Loss
    -       -       -       (4,005,900 )     -       -       (4,005,900 )     $(4,005,900 )
Distributions to Stockholders
    -       -       -       (1,957,900 )     -       -       (1,957,900 )     -  
Unrealized loss on available-for-sale securities
    -       -       -       -       -       (7,300 )     (7,300 )     (7,300 )
Reclassification of cumulative gain, net of tax
    -       -       -       -       -       (184,300 )     (184,300 )     (184,300 )
Retirement of Treasury Stock
    (4,933 )     (4,933 )     -       (449,824 )     454,757       -       -       -  
Change in par value
    -       (39,426 )     39,426       -       -       -       -       -  
                                                                 
                                                              $(4,577,500 )
                                                                 
Balances, April 30, 2011
    39,824       $398       $424,826       $7,152,376       $0       $0       $7,197,600          
                                                                 
 
See notes to consolidated financial statements.


F-5


Table of Contents

 
Peak Resorts, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
Years ended April 30,
 
                         
    2011     2010     2009  
 
Cash Flows from Operating Activities
                       
Net Earnings (loss)
  $ (4,005,900 )   $ 2,832,900     $