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Aprll 13, 2014

uear !ohn:
Slnce my leLLer Lo you on March 23, 2014, l have noL recelved a dlrecL response. Powever, l have seen
your commenLs Lo Lhe medla whlch l belleve are causlng unnecessary alarm ln Lhe communlLy. lL ls my
conLlnued hope LhaL you wlll respond Lo our overLures Lo begln dlscusslons abouL how we can work
LogeLher cooperaLlvely on some reallsLlc soluLlons.
?our commenLs Lo Lhe medla seem Lo suggesL LhaL ln addlLlon Lo your lnLeresL ln reLalnlng conLrol of
Lhe resorL, you are Lrylng Lo look ouL for Lhe ark ClLy communlLy by keeplng Lhe operaLlon of Lhe skl
Lerraln lndependenL." l am noL sure whaL LhaL ls based on, glven LhaL CM8 ls noL an lndependenL"
resorL. ?ou have operaLed CM8 wlLh elghL oLher properLles as parL of owdr Corp. ?ou have also
suggesLed LhaL lL would be bad for Lhe communlLy for vall 8esorLs Lo operaLe boLh Canyons and CM8.
l appreclaLe you ralslng Lhls parLlcular lssue, as we have been dlscusslng lL ourselves wlLh folks ln Lhe
communlLy. And l goL Lo see Lhe concern ln lLs full comlc glory when l aLLended a recenL showlng of Lhe
ark ClLy lollles. 1o be sure, vall 8esorLs ls new Lo Lhe ark ClLy communlLy and lL's undersLandable
LhaL Lhere ls apprehenslon abouL change. Powever, whlle our company may be new Lo ark ClLy, we
have a long Lrack record operaLlng skl areas LhroughouL Lhe unlLed SLaLes from whlch we can be
[udged.
lL's lmporLanL Lo polnL ouL LhaL Lhere are numerous slLuaLlons where Lwo or more resorLs ln Lhe same
communlLy have been successfully operaLed by Lhe same company. lor example, your own company
operaLes boLh kllllngLon and lco, whlch are wlLhln Lwo mlles of each oLher ln vermonL. Cur company
successfully operaLes vall and 8eaver Creek ln Lagle CounLy, Colo. and 8reckenrldge and keysLone ln
SummlL CounLy, Colo. And ouLslde of our Lwo companles Lhere are oLher examples, such as WhlsLler
and 8lackcomb, Aspen and Snowmass, and Squaw and Alplne Meadows, [usL Lo name a few.
vall 8esorLs operaLes 10 mounLaln resorLs ln slx sLaLes. ln each case, our company ls commlLLed Lo our
communlLles, noL only because lL ls Lhe rlghL Lhlng Lo do, buL because lL's also a crlLlcal componenL of
our buslness sLraLegy. lndeed, our guesLs conslder our communlLles Lo be parL and parcel of Lhe resorL
experlence, and as such, we are only as sLrong as Lhe communlLles ln whlch we operaLe. 1hus, no


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maLLer whaL happens beLween owdr Corp. and vall 8esorLs, Lhe well-belng of Lhe ark ClLy
communlLy wlll always be one of our hlghesL prlorlLles. lf you look aL Lhe oLher mounLaln Lowns where
vall 8esorLs operaLes, l Lhlnk you wlll see greaL collaboraLlve dlalogue, LhoughLful parLnershlp, healLhy
lnvesLmenLs ln Lhe mounLaln, conLrlbuLlons Lo crlLlcal communlLy organlzaLlons and sLrong overall
flnanclal healLh. And of course, some of Lhe mosL lnexpenslve season skl passes found anywhere ln Lhe
world.
ln addlLlon, wlLh CM8 and Canyons, whlle we would operaLe each resorL separaLely, we would be able
Lo brlng Lhe Lwo skl experlences LogeLher by connecLlng Lhe skl Lerraln and by allowlng CM8's
cusLomers Lo use boLh resorLs on a slngle skl pass--someLhlng LhaL sklers and rlders have wanLed for
years--buL no one has been able Lo brlng abouL. llnally, our ablllLy Lo lnvesL ln Lhe Lwo resorLs Lo
upgrade llfLs, resLauranLs, groomlng and guesL servlce wlll dramaLlcally lmprove Lhe guesL experlence
and ensure LhaL Lhe ark ClLy communlLy ls seL up for Lhe guesLs of Lhe fuLure.
Whlle l undersLand your lnLeresL ln reLalnlng conLrol of Lhe resorL, l fear LhaL lgnores reallLy. lf your
lease ls found Lo have explred, CM8 wlll have no rlghLs, no lnLeresL and no role ln LhaL Lerraln
anymore. uemandlng LhaL you sLlll be able Lo conLlnue operaLlng Lhe resorL, even afLer loslng your
lease, slmply ls noL reallsLlc. lL's also lmporLanL Lo hlghllghL LhaL Lhls ls noL a Lakeover" of your asseLs
by vall 8esorLs. As ouLllned ln my prevlous leLLer, lL's noL necessary for vall 8esorLs Lo purchase
anyLhlng from CM8. Cur Company ls very wllllng Lo work consLrucLlvely wlLh you Lo maxlmlze Lhe
value of your base lands for you and Lo ensure LhaL ark ClLy resldenLs and guesLs conLlnue Lo have a
hlgh-quallLy experlence aL Lhe resorL.
l compleLely undersLand LhaL posLurlng can come wlLh llLlgaLlon. 1hls courL case has already Laken
more Lhan Lwo years slnce you flled Lhe lawsulL, and based on commenLs from your sLaff, you are
conLemplaLlng appeals lf you lose whlch could drag Lhlngs ouL even furLher. 8uL, as everyone sLarLs
plannlng for Lhe 2014/2013 skl season, we Lhlnk lL's crlLlcal Lo send a message Lo Lhe ark ClLy
communlLy and Lhe broader skl markeL LhaL when you have exhausLed your legal efforLs, you wlll work
consLrucLlvely wlLh us and Lhe 1own. l Lhlnk lL wlll be good Lo share LhaL you undersLand LhaL lf you
have no lease for Lhe ark ClLy skl Lerraln, owdr Corp. wlll noL be Lhe resorL operaLor. Whlle
LhreaLenlng Lo remove skl llfLs or block skler access may make sense durlng llLlgaLlon, when Lhe case ls
over, you should make sure you geL falr value for whaL's yours, buL also Lake sLeps Lo ensure we
provlde Lhe besL guesL and communlLy experlence posslble. l can absoluLely make LhaL commlLmenL
for vall 8esorLs.


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!usL llke vall 8esorLs, owdr Corp. has a greaL Lrack record and l have Lold folks ln Lhe communlLy LhaL
we should all Lake comforL LhaL ulLlmaLely you wlll do Lhe rlghL Lhlng here, as wlll we. l genulnely look
forward Lo Lhe opporLunlLy for furLher dlscusslons and am avallable Lo meeL aL anyLlme.
Slncerely,

8ob kaLz
Chalrman and Chlef LxecuLlve Cfflcer
vall 8esorLs, lnc.