AIF 2015 - Whistler Blackcomb

WHISTLER BLACKCOMB HOLDINGS INC.
ANNUAL INFORMATION FORM
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2015
December 11, 2015
TABLE OF CONTENTS
Page
REFERENCE INFORMATION ................................................................................................................I
Forward Looking Statements .................................................................................................................. i
GAAP and Non-GAAP Financial Measures .......................................................................................... ii
Market and Industry Data ...................................................................................................................... iii
Trademarks, Tradenames and Service Markets ..................................................................................... iii
CORPORATE STRUCTURE ................................................................................................................... 1
General ................................................................................................................................................... 1
Intercorporate Relationships ................................................................................................................... 1
GENERAL DEVELOPMENT OF THE BUSINESS .............................................................................. 2
General ................................................................................................................................................... 2
History .................................................................................................................................................... 2
Location and Amenities.......................................................................................................................... 3
Industry Overview .................................................................................................................................. 4
Competitive Strengths ............................................................................................................................ 6
Strategy................................................................................................................................................... 8
BUSINESS OF THE COMPANY ........................................................................................................... 11
Lift Operations ..................................................................................................................................... 11
Snow School Operations ...................................................................................................................... 12
Retail and Rental Operations ................................................................................................................ 12
Food and Beverage Operations ............................................................................................................ 13
Other Resort Operations ....................................................................................................................... 13
Real Estate Activities ........................................................................................................................... 14
Marketing ............................................................................................................................................. 14
Sales ..................................................................................................................................................... 15
Employees ............................................................................................................................................ 15
Whistler and Blackcomb Development Agreements and Governmental Regulation........................... 15
Intellectual Property ............................................................................................................................. 16
Sustainability ........................................................................................................................................ 17
RISK FACTORS....................................................................................................................................... 17
Risks Related to Whistler Blackcomb .................................................................................................. 17
Risks Related to Third Party Interests .................................................................................................. 26
Risks Related to an Investment in the Common Shares ....................................................................... 27
DIVIDENDS .............................................................................................................................................. 27
DESCRIPTION OF CAPITAL STRUCTURE ...................................................................................... 28
THE PARTNERSHIPS ............................................................................................................................ 29
Capitalization........................................................................................................................................ 29
General Partner Interests ...................................................................................................................... 29
Units ..................................................................................................................................................... 29
Distribution Policy ............................................................................................................................... 30
Allocation of Net Income and Losses .................................................................................................. 31
Functions and Powers of General Partner ............................................................................................ 31
Limited Liability................................................................................................................................... 32
Issuance of Additional Partnership Units ............................................................................................. 32
Transfer of Partnership Interests .......................................................................................................... 33
Retirement of General Partner .............................................................................................................. 33
Amendment .......................................................................................................................................... 33
Meetings ............................................................................................................................................... 33
i
TABLE OF CONTENTS
Page
CREDIT FACILITIES OF THE PARTNERSHIPS ............................................................................. 34
MARKET FOR SECURITIES ................................................................................................................ 35
DIRECTORS AND EXECUTIVE OFFICERS ..................................................................................... 35
Conflicts of Interest .............................................................................................................................. 36
Indemnification .................................................................................................................................... 37
Cease Trade Orders, Bankruptcies, Penalties or Sanctions .................................................................. 37
AUDIT COMMITTEE INFORMATION .............................................................................................. 38
Pre-Approval Policies and Procedures ................................................................................................. 39
Audit and Non-Audit Fees Billed by Auditor ...................................................................................... 39
LEGAL PROCEEDINGS AND REGULATORY ACTIONS .............................................................. 39
INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS .................. 40
TRANSFER AGENT AND REGISTRAR ............................................................................................. 40
MATERIAL CONTRACTS .................................................................................................................... 40
INTERESTS OF EXPERTS .................................................................................................................... 41
ADDITIONAL INFORMATION ............................................................................................................ 41
GLOSSARY OF TERMS ......................................................................................................................... 42
APPENDIX A ........................................................................................................................................... A-1
ii
REFERENCE INFORMATION
The information in this Annual Information Form is stated as at September 30, 2015, unless otherwise
indicated.
Unless otherwise noted or the context otherwise indicates, the “Company”, “we”, “us” and “our” refer to
Whistler Blackcomb Holdings Inc. and its direct and indirect subsidiaries, including the Partnerships, or
other entities controlled by them.
Unless otherwise indicated, all references to “$” or dollars in this Annual Information Form refer to
Canadian dollars and all references to “US$” in this Annual Information Form refer to United States
dollars. The noon exchange rate on September 30, 2015 as reported by the Bank of Canada for the
conversion of Canadian dollars into United States dollars was $1.00 to US$0.7466. Certain totals,
subtotals and percentages throughout this Annual Information Form may not reconcile due to rounding.
In this Annual Information Form, all references to the number of skier visits and the ETP derived
therefrom are unaudited.
This Annual Information Form includes certain information derived from the consolidated financial
statements of the Company for Fiscal 2015, Fiscal 2014 and Fiscal 2013. Readers are cautioned that the
comparability of financial results of the Company and the Partnerships is impacted by the factors
discussed in the Company’s Management’s Discussion and Analysis of Financial Condition and Results
of Operations for Fiscal 2015 available under the Company’s SEDAR profile at www.sedar.com.
Certain capitalized terms and phrases used in this Annual Information Form are defined in the “Glossary
of Terms” beginning on page 42.
Forward Looking Statements
Certain statements in this Annual Information Form about the Company’s current and future plans,
expectations and intentions, results, levels of activity, performance, goals or achievements or any other
future events or developments constitute forward-looking statements. The words “may”, “will”, “would”,
“should”, “could”, “expects”, “plans”, “intends”, “trends”, “anticipates”, “believes”, “estimates”,
“predicts”, “likely” or “potential” or the negative or other variations of these words or other comparable
words or phrases, are intended to identify forward-looking statements. Discussions containing forwardlooking statements may be found, among other places, under “General Development of Business”,
“Business of the Company”, “Dividends” and “Risk Factors”. Forward-looking statements include
statements relating to: (i) anticipated visits, (ii) the number of visits that Whistler Blackcomb can
accommodate annually without incremental capital investment; (iii) Whistler Blackcomb’s strategy,
including with regard to growth projects and opportunities, (iv) the business of the Company,
(v) Distributable Cash of the Partnerships, (vi) the Company’s expectations to continue to operate the
Whistler Blackcomb resort under the Development Agreements, (vii) the Company’s expectation that the
OCP Decision and the Tsilhqot’in Decision will not lead to any fundamental changes in the operation of
Whistler Blackcomb, and (viii) the cash available for the payment of dividends and capital investment by
the Company. Forward-looking statements are based on estimates and assumptions made by management
in light of its experience and perception of historical trends, current conditions and expected future
developments, as well as other factors that management believes are appropriate and reasonable in the
circumstances, but there can be no assurance that such estimates and assumptions will prove to be correct.
Certain assumptions in respect of incremental administrative and public company expenses, financing
costs, consumer confidence levels, economic conditions, leisure activity levels, weather conditions,
competitive conditions, workforce availability, access to capital, capital expenditure estimates, plans and
activities, operating risks and cash distributions are material factors made in preparing forward-looking
information and management’s expectations. Many factors could cause the Company’s actual results,
levels of activity, performance or achievements or future events or developments to differ materially from
those expressed or implied by the forward-looking statements, including, without limitation, the following
factors, which are discussed in greater detail in the “Risk Factors” section of this Annual Information
Form: unfavourable weather conditions, unfavorable economic conditions, decreases in leisure and
business travel, seasonality of operations, capital expenditures, currency fluctuations, reliance on the
Development Agreements, competition from other resorts, dependence on key employees and seasonal
workforce, workforce risks, the impact of natural disasters, risks related to the New Credit Facility and
interest rate risks, adequacy of insurance coverage, litigation or governmental investigations, safety and
accident risks, environmental laws and regulations, risks related to privacy laws, information technology
and the processing of credit card information, negative publicity or unauthorized use of Whistler
Blackcomb trademarks or tradenames, risks relating to growth projects and acquisitions, risks relating to
third party interests and risks relating to an investment in the Common Shares, including with regard to
dividend payments and future sales or issuances of Common Shares.
These factors are not intended to represent a complete list of the factors that could affect the Company;
however, these factors should be considered carefully. The purpose of the forward-looking statements is
to provide the reader with a description of management’s expectations regarding the Company’s and the
Partnerships’ financial performance and may not be appropriate for other purposes; readers should not
place undue reliance on forward-looking statements made herein. Furthermore, unless otherwise stated,
the forward-looking statements contained in this Annual Information Form are made as of the date of this
Annual Information Form, and the Company has no intention and undertakes no obligation to update or
revise any forward-looking statements, whether as a result of new information, future events or otherwise,
except as required by law. The forward-looking statements contained in this Annual Information Form
are expressly qualified by this cautionary statement.
GAAP and Non-GAAP Financial Measures
The Company’s financial statements, available on SEDAR at www.sedar.com, are prepared in accordance
with generally accepted accounting principles (“GAAP”) in Canada as set out in the CPA Canada
Handbook – Accounting under Part 1, which incorporates International Financial Reporting Standards
(IFRS), as issued by the International Accounting Standards Board (IASB).
This Annual Information Form makes reference to certain non-GAAP measures. The non-GAAP
measures used by the Company are Adjusted EBITDA, Free Cash Flow, Effective Ticket Price or ETP.
Adjusted EBITDA, Effective Ticket Price, and Free Cash Flow do not have standardized meanings
prescribed by GAAP and are, therefore, unlikely to be comparable to similar measures presented by other
companies. Adjusted EBITDA, Effective Ticket Price, and Free Cash Flow should not be considered in
isolation or as a substitute for analysis of financial information reported under GAAP.
Adjusted EBITDA, Effective Ticket Price, and Free Cash Flow are non‐GAAP measures and are
presented to complement our GAAP measures by providing further insight, from management’s
perspective, into the financial performance of our business as a whole. The Company also believes that
securities analysts, investors and other interested parties frequently use non- GAAP measures in the
evaluation of issuers. Management also uses non-GAAP measures in order to facilitate performance
comparisons from period to period, prepare annual operating budgets and assess its ability to meet future
debt service, capital expenditure and working capital requirements. Readers should refer to the
Company’s MD&A for Fiscal 2015 available on SEDAR at www.sedar.com for further information
regarding the definition and reconciliation of Adjusted EBITDA used and presented by the Company to
the most directly comparable GAAP measures.
ii
During the first quarter of Fiscal 2015, the Company changed its presentation of Cash Available for
Payment of Dividends and Distributions to Free Cash Flow. The Cash Available for Payment of
Dividends and Distributions presented in prior year MD&As has been replaced and restated in the Fiscal
2015 MD&As. The Company believes that Free Cash Flow is a more relevant and important measure of
the cash flow available to pay dividends and distributions, repay debt, reinvest in our business, and invest
in other opportunities that may arise. The difference between Cash Available for Payment of Dividends
and Distributions to Free Cash Flow is the exclusion of debt issuance costs and prepayment penalties
from the reconciliation below as these items are not considered part of our normal operations.
Market and Industry Data
This Annual Information Form contains statistical market and industry data, market research and industry
forecasts that were obtained from independent industry publications and reports or based on estimates
derived from same and management’s knowledge of, and experience in, the markets in which Whistler
Blackcomb operates. Industry publications and reports generally indicate that they have obtained their
information from sources believed to be reliable, but do not guarantee the accuracy and completeness of
their information. While the Company believes this data to be reliable, market and industry data is
subject to variations and cannot be verified due to limits on the availability and reliability of data inputs,
the voluntary nature of the data gathering process and other limitations and uncertainties inherent in any
statistical survey. Accordingly, the accuracy and completeness of this information cannot be guaranteed.
The Company has not independently verified any of the data from third party sources referred to in this
Annual Information Form or ascertained the underlying assumptions relied upon by such sources.
Trademarks, Tradenames and Service Markets
This Annual Information Form includes trademarks and tradenames, such as “Whistler Blackcomb”,
“Whistler Mountain” and “Blackcomb Mountain”, which are protected under applicable intellectual
property laws. These trademarks and tradenames are the property of the Company, Whistler L.P. or
Blackcomb L.P., as applicable. Solely for convenience, these trademarks and tradenames referred to in
this Annual Information Form may appear without the ® or TM symbols, but such references are not
intended to indicate, in any way, that the respective owners thereof will not assert, to the fullest extent
under applicable law, its rights or the right of the applicable licensor to these trademarks and tradenames.
See “Business of the Company – Intellectual Property”. All other trademarks and tradenames used in this
Annual Information Form are the property of their respective owners.
iii
CORPORATE STRUCTURE
General
The Company was incorporated on October 4, 2010 under the Canada Business Corporations Act and
continued into British Columbia under the Business Corporations Act (British Columbia) on October 29,
2010. The principal business office of the Company is located at 4545 Blackcomb Way, Whistler, British
Columbia, V0N 1B4. The registered office of the Company is located at 1200 Waterfront Centre, 200
Burrard Street, Vancouver, British Columbia, V7X 1T2.
The Company’s articles were amended in February 2015 to include among other things, advance notice
provisions (the “Advance Notice Provisions”) providing a clear framework for advance notice of
nominations of persons for election to the Board. The Advance Notice Provisions set deadlines for a
certain number of days before a Shareholders’ meeting for a Shareholder to notify the Company of his or
her intention to nominate one or more directors, and explains the information that must be included with
the notice for it to be valid. The Advance Notice Provisions apply at any annual meeting of Shareholders
or a special meeting of Shareholders that was called to elect directors, and may be waived by the Board.
It does not affect the ability of the Shareholders to requisition a meeting or make a proposal under the
Business Corporations Act (British Columbia). A copy of the amended articles of the Company approved
by the Shareholders is available on SEDAR at www.sedar.com.
Intercorporate Relationships
The following organizational chart illustrates the material components of the structure of the Company
and its subsidiaries, together with the jurisdiction under which each entity exists:
Whistler Blackcomb
Holdings Inc. (1)
(British Columbia)
Class B Unit (2)
Class B Unit (2)
General Partner
Interest (2)(3)
Nippon Cable (5)
Notes:
(1)
(2)
(3)
Class A Units (4)
General Partner
Interest (2)(3)
Whistler L.P.
Blackcomb L.P.
(British Columbia)
(British Columbia)
Whistler Assets
Blackcomb Assets
Class A Units (4)
Nippon Cable (5)
The Company also directly owns all of the shares of Whistler Blackcomb Employment Corp., which is a wholly-owned subsidiary that
employs the employees of Whistler Blackcomb (see “Business of the Company – Employees”), and certain other non-material
subsidiaries, being WB Land Inc. and Blackcomb Skiing Enterprises Ltd., Lodging Ovations Corp. and Whistler/Blackcomb Mountain
Employee Housing Ltd. (collectively, the “Non-Material Subsidiaries”), each of which is incorporated under the Business
Corporations Act (British Columbia) other than Lodging Ovations Corp., which is incorporated under the Business Corporations Act
(Alberta).
The general partner interests of each of the Partnerships held directly and indirectly by the Company and the limited partner interests
held through Class B Units of each of the Partnerships held directly by the Company together entitle the Company to 75% of the
distributions by, and net income of, the applicable Partnership. See “The Partnerships”.
The Company holds a general partner interest in each of the Partnerships directly and also holds a general partner interest indirectly
through Whistler Blackcomb General Partner Ltd., a wholly-owned subsidiary of the Company and an additional general partner of
the each of the Partnerships. Nippon Cable also holds a general partner interest in the Partnerships. Such additional general partner
does not have any power or authority to carry on the business of either of the Partnerships except if, and for so long as, there is no
other general partner which is competent to do so. See “The Partnerships”.
(4)
(5)
The Class A Units held by Nippon Cable in each of the Partnerships entitle Nippon Cable and its affiliates to 25% of the distributions
by, and net income of, the applicable Partnership. See “The Partnerships”.
Nippon Cable holds limited partner interests through Class A Units of each of the Partnerships and its general partnership interest in
each of the Partnerships indirectly through affiliates and other related companies.
GENERAL DEVELOPMENT OF THE BUSINESS
General
Whistler Blackcomb is a four season mountain resort that features two adjacent and integrated mountains,
Whistler Mountain and Blackcomb Mountain, with 200 marked runs, over 8,000 acres of skiable terrain,
14 alpine bowls and three glaciers and is located adjacent to Whistler Village.
History
The current operations of Whistler Blackcomb were formed when Intrawest purchased Whistler Mountain
resort in 1997 to combine it with its Blackcomb Mountain resort. The integration of the Whistler
Mountain operations and Blackcomb Mountain operations was completed prior to the opening of the
1998-1999 ski season, marking Whistler Blackcomb’s first season as a combined resort.
In July 2003, Vancouver and the Resort Municipality of Whistler were selected as the host venues for the
Olympic Winter Games which were held in February and March 2010. The alpine skiing events were
held on Whistler Mountain. The Olympic Winter Games garnered a worldwide audience, including an
estimated 3.5 billion worldwide television viewers.
In December 2008, the Peak 2 Peak Gondola commenced operations connecting the high alpine areas of
Whistler Mountain and Blackcomb Mountain with the longest and highest gondola lift of its kind in the
world.
The Whistler Blackcomb Assets are currently owned, directly and indirectly, by the Partnerships. On
November 9, 2010, the Company completed its IPO and in connection with the IPO acquired, directly and
indirectly, a 75% interest in each of the Partnerships and acquired certain other assets from Intrawest and
became the controlling general partner for each of the Partnerships. The remaining 25% non-controlling
interest in each of the Partnerships is owned by Nippon Cable. Details regarding the acquisition of the
Whistler Blackcomb Assets are available in the Company’s business acquisition report on Form 51-102F4
available on SEDAR at www.sedar.com.
On January 18, 2013, the Company announced an $18 million investment in two new lifts at Whistler
Mountain and Blackcomb Mountain. The investment resulted in the replacement of the Harmony
high-speed quad chairlift with a new high-speed, detachable, six-pack lift and a high-speed quad chairlift
going into the Crystal Zone, previously accessed by fixed-grip triple chair. The $18 million investment
included the cost to supply and install the two new lifts as well as snow making enhancements, terrain
work and other improvements. The two new lifts opened on December 7 and December 14, 2013,
respectively.
On September 30, 2013, the Company acquired the retail and rental business of Affinity Snowsports.
Affinity Snowsports operates six locations in Whistler Village with a retail and rental offering catering to
price conscious guests.
On February 4, 2014, the Company announced a $6 million upgrade to the Whistler Village Gondola,
including the replacement of the original cabins with 160 new eight passenger seated cabins and gondola
terminal improvements. Additionally, the Company announced a planned capital expenditure of $5.9
2
million for technology initiatives, including a new enterprise resource planning system and radiofrequency identification access gates on most mountain lifts. These capital investments were completed
prior to 2014-2015 ski season opening.
On December 14, 2014, the Company acquired the retail and rental business of Summit Ski Limited.
Summit Ski operates the largest year-round retail and rental location at the base of Whistler Mountain and
a seasonal ski rental location on Blackcomb Mountain.
On February 11, 2015, the Company announced a $5.4 million upgrade to the Rendezvous Lodge on
Blackcomb Mountain aimed at improving guest experience and generating incremental contribution from
this important year-round mountain-top restaurant facility. The Rendezvous Lodge upgrade was
completed prior to the Blackcomb Mountain’s ski 2015/2016 season opening.
Location and Amenities
Whistler Blackcomb and the Resort Municipality of Whistler are located in the Coast Mountains of
British Columbia, Canada, some 125 kilometres from Vancouver and 350 kilometres from Seattle,
Washington. The Resort Municipality of Whistler and Whistler Blackcomb are accessible from these two
large urban centres via car, bus, train, plane and helicopter. An estimated 12 million people live in British
Columbia and Washington State with an estimated eight million people located within a five hour drive of
the Resort Municipality of Whistler and Whistler Blackcomb.
In addition to being a world-class ski and snowboard destination, other activities available in the Resort
Municipality of Whistler include mountain biking, cycling golfing, hiking, fishing, swimming, canoeing,
kayaking, bungee jumping white water rafting, tennis, zip trekking, in-line skating and sailing in the
summer and snowmobiling, snowshoeing, cross-country skiing and skating in the winter.
The Resort Municipality of Whistler has undergone considerable development over the past three decades
and its focal point is Whistler Village, a pedestrian village filled with a variety of guest amenities located
at the bases of Whistler Mountain and Blackcomb Mountain. Whistler Village has approximately 8,000
rental units (approximately 250 units managed by Whistler Blackcomb) available for nightly
accommodation.
The Resort Municipality of Whistler also boasts a wide variety of restaurants, lounges and bars with more
than 150 venues (18 operated by Whistler Blackcomb and six of which are located in or around Whistler
Village), including upscale dining establishments, bistros, pubs, cafes and quick service convenience
outlets, as well as a wide variety of entertainment options, including a movie theatre, museum, library,
First Nations cultural centre, wellness activities, spas, nightlife and après-ski venues. The Resort
Municipality of Whistler contains more than 215 boutique stores offering merchandise ranging from highend fashion apparel and handcrafted jewellery to ski and snowboard apparel and equipment. Whistler
Blackcomb owns or leases and operates 40 retail and rental stores on-mountain and in Whistler Village.
Whistler Blackcomb is a member organization of Tourism Whistler, which promotes the Resort
Municipality of Whistler as an international destination in order to increase overnight visits. Whistler
Blackcomb also coordinates marketing efforts with its strategic partners in order to share marketing plans
and media bookings, coordinate and compliment coverage and exposure, enhance marketing coverage and
marketing plans and identify target markets.
3
Industry Overview
General
The North American ski resort industry is a mature, stable industry. Since the late 1990s, industry trends
such as high-speed lifts, resort village development, innovations in ski equipment, the growth in
popularity of snowboarding, improved snowmaking capabilities and changes in industry demographics
have all played a significant role in the growth, stability and long-term sustainability of the ski industry.
The ski resort industry is characterized by significant barriers to entry as the number of attractive
mountain locations is limited, the cost of “greenfield” resort development is high and environmental and
other regulations impose significant restrictions on new development. Due to these barriers, it has been
over 30 years since the last three significant resorts, Blackcomb Mountain and Beaver Creek in 1980 and
Deer Valley in 1981, were developed in North America. Management believes that the development of
another large-scale ski area in North America is unlikely to occur in the foreseeable future.
One of the principal measures of ski resort industry performance is the “skier visit”, which represents a
person utilizing a ski ticket or ski pass to access a ski mountain for any part of one day, and includes both
paid and complimentary access (but excludes sightseeing visits, mountain biking and summer glacier
skiing). The 2014/2015 ski season generated 70.7 million skier visits to ski resorts in North America.
Source: National Ski Areas Association: Kottke Report & Canadian Ski Council.
The ski resort industry in North America consists of resorts ranging from small ski area operations that
service local and regional guests to large resorts that attract both local and regional guests, as well as
destination guests in search of a comprehensive resort experience. Destination guests typically generate a
higher total revenue per skier visit than local or regional guests. Destination guests also have a longer
length of stay per trip and are greater consumers of ancillary amenities and services, such as snow school,
equipment rental, retail and food and beverage services. While generating lower revenue per skier visit,
local and regional guests provide a consistent visitor base across ski seasons and are more frequent buyers
of season pass or frequency card sales, an important source of stable annual revenues.
From the 2005/2006 ski season to the 2014/2015 ski season, the average ETP of ski resorts in the United
States has increased at a compound annual growth rate of 4.08%. ETP is calculated by dividing ski related
lift ticket revenue by total skier visits. Ski tickets being the largest source of revenue and the core of ski
resorts, ETP is an important measure of operating performance allowing investors and others to evaluate
4
and compare the yield generated by ski lift tickets from period to period. Ski resorts in the United States
had an average ETP of US$46.70 during the 2014/2015 ski season, the highest on record. Management
believes that the compound annual growth rate of lift ticket prices at ski resorts in Western Canada since
2000 is comparable to those of the United States.
Source: National Ski Areas Association: Kottke Report.
Industry Demographics
The participant demographic of the ski industry has evolved over the past two decades. The majority of
ski resort visitors throughout the 1980s and early 1990s were middle-aged with disposable income and
were relatively skilled/experienced skiers. However, technological progress within the ski industry,
including innovations in ski and snowboard equipment, clothing, lifts and grooming and snowmaking
equipment, have enabled a new, less skilled or experienced group of individuals to enjoy skiing and
snowboarding. As ski resorts increasingly offer a wide range of non-ski amenities and services, they are
able to attract a more diverse visitor demographic.
Competition
Whistler Blackcomb over the past 10 years has averaged approximately 10.6% market share of skier visits
in the Canadian market and approximately 2.6% market share of ski visits in the North American market.
In the local and regional market, which accounted for approximately 51% of Whistler Blackcomb’s skier
visits in Fiscal 2015, Whistler Blackcomb competes with a range of smaller “drive-to” and regional
mountain resorts, including Cypress, Grouse, Big White, Sun Peaks and Crystal. Whistler Blackcomb is
the market leader in the region with unparalleled infrastructure, terrain and amenities and attracts more
annual skier visits than the top five closest regional competitors combined. The table below illustrates
Whistler Blackcomb’s competitive positioning relative to the most visited regional ski resorts.
5
Facility Statistics – Regional Ski Resorts
1
Resort
Average
Open
Whistler Blackcomb
Cypress
Grouse
Big White
Sun Peaks
Crystal
November
November
November
November
November
November
Average
Close
Skiable
Acres
Snowmaking
Acres
Average
Annual
Snowfall
(centimetres)
May
8,171
697
1,1631
April
600
81
1,083
April
212
159
1,163
April
2,765
NA
750
April
4,270
40
600
April
2,600
N/A
1,234
Source: Company websites and management estimates
Vertical
Drop
(feet)
5,280
2,010
1,312
2,550
2,894
3,100
Number
of Trails
200
53
26
118
135
57
Lift
Count
Lift
Capacity
(PPH)
37
9
5
15
12
11
69,939
9,000
6,600
28,000
12,000
19,588
Average over past 10 years.
In the destination segment, which accounted for approximately 49% of Whistler Blackcomb’s skier visits in
Fiscal 2015, Whistler Blackcomb competes for visitors with major destination mountain resorts in Canada
and the United States, including Vail, Breckenridge, Aspen/Snowmass, Deer Valley, Park City and
Mammoth. As illustrated below, Whistler Blackcomb compares favourably to each of its North American
destination resort competitors on most metrics.
Facility Statistics – Most Visited Ski Resorts in North America
Resort
Average
Open
Whistler Blackcomb ..................November
Vail ............................................November
Breckenridge ..............................November
Aspen Snowmass .......................November
Deer Valley ................................December
Park City ....................................November
Mammoth ..................................November
1
Average
Close
Skiable
Acres
Snowmaking
Acres
Average
Annual
Snowfall
(centimetres)
Vertical
Drop
(feet)
Number
of Trails
Lift
Count
Lift
Capacity
(PPH)
May
April
April
April
April
April
June
8,171
5,286
2,908
3,332
2,026
7,300
5,000
697
461
600
230
660
475
700
1,1631
897
762
762
762
907
1,016
5,280
3,450
3,398
4,406
3,000
3,195
3,100
200
195
187
94
101
302
150
37
31
34
21
21
41
28
69,939
59,092
46,800
32,358
50,470
N/A
54,000
Average over past 10 years.
Competitive Strengths
Whistler Blackcomb has a number of competitive strengths that management believes will enable it to
continue to record strong operational and financial performance.
North America’s Premier Mountain Resort
Whistler Blackcomb is North America’s largest and most visited mountain resort. Whistler Blackcomb
offers an unparalleled ski and snowboarding experience in North America with a mile-high vertical drop,
three glaciers, the largest area of skiable terrain, the most marked trails in Canada and the largest lift
capacity of any ski resort in North America.
The bases of Whistler Mountain and Blackcomb Mountain are integrated with Whistler Village, home to
an expansive array of lodging, dining, entertainment and shopping options. Whistler Blackcomb and
Whistler Village have received a number of accolades from leading travel and leisure publications
including being named the number one overall mountain resort by Ski Magazine, Freeskier Magazine and
SBC Resort Guide in 2015.
6
Balanced and Attractive Customer Mix
Whistler Blackcomb attracts guests from around the world, divided between two guest categories:
(i) local and regional guests and (ii) destination guests. Management estimates that the mix of skier visits
from local and regional guests to destination guests was 51%/49%, 59%/41% and 62%/38% in Fiscal
2015, Fiscal 2014 and Fiscal 2013, respectively.
Local and regional guests from British Columbia and Washington State provide Whistler Blackcomb with
a stable customer base for winter revenue, which is more consistent in terms of revenue from year to year
when compared to the destination market. In Fiscal 2015, 32% of total lift ticket revenue is collected
prior to December 31st of each year through the sale of season passes and frequency card products of
which the majority is purchased by local and regional guests.
While local and regional guests provide revenue stability, destination guests typically generate a higher
overall revenue per visit relative to local and regional guests. Destination guests are more frequent users
of the services and amenities available at Whistler Blackcomb, such as snow and bike school, retail and
rental outlets and food and beverage services.
Whistler Blackcomb’s destination guests are drawn from a variety of regions around the world. Over the
past two years, management estimates that an average of approximately 29% of destination guests came
from the United States (excluding Washington State), approximately 21% from Canada (excluding British
Columbia) and approximately 50% from other international locations.
Favourable Weather and Snow Conditions
Whistler Blackcomb benefits from favourable snowfall conditions which result in one of the longest ski
seasons in North America. As skier visits are influenced by weather conditions and by the amount and
timing of snowfall during the ski season, Whistler Blackcomb’s conditions can have a significant impact
on annual skier visits. Whistler Blackcomb has received average annual snowfall of 1,163 centimetres
(458 inches) over the last 10 seasons. The table below outlines the total snowfall for the last ten ski
seasons.
Ski Season
2014/15
2013/14
2012/13
2011/12
2010/11
2009/10
2008/09
2007/08
2006/07
2005/06
................................................................................................................................
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................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
............................................................................................................................... .
............................................................................................................................... .
............................................................................................................................... .
................................................................................................................................
Total Snowfall at
Whistler Blackcomb
(centimetres)
672
833
1,112
1,389
1,579
1,494
913
1,022
1,411
1,184
Due to Whistler Blackcomb’s coastal proximity, temperatures are moderate through the winter season,
rarely falling below -10°C (14°F) in the valley and -15°C (5°F) in the alpine area during the coldest part
of the year.
7
In addition to significant natural snowfall, Whistler Blackcomb benefits from investments in the latest
technology in snowmaking systems (including the acquisition and maintenance of water rights). Whistler
Blackcomb’s snowmaking volume and expertise, as well as its snow grooming capabilities, enable
Whistler Blackcomb to offer guests more consistent and predictable conditions. As a result of
improvements made by Whistler Blackcomb in advance of the Olympic Winter Games, annual
snowmaking capacity now covers 697 acres of ski terrain. Due to the favourable weather and snow
conditions, snowmaking at Whistler Blackcomb is typically only needed in high traffic areas and the
lower elevations on the mountains as the high terrain areas tend to be self-sustaining in terms of snow
coverage.
Four Season Resort
Although ski resort operations are seasonal by nature, Whistler Blackcomb’s winter ski season is
generally one of the longest of any North American ski resort and typically begins in mid-November and
extends through May. Whistler Blackcomb’s glacier ski season runs in June and July and it is one of only
two North American resorts to offer summer glacier skiing.
Whistler Blackcomb also has non-ski season activities, including Peak 2 Peak Gondola sightseeing,
hiking and mountain biking, which attract lift service customers daily during the summer and fall periods
of May and October, as well as food and beverage, mountain bike school, retail and bike rental customers.
Management believes that the Peak 2 Peak Gondola is an important feature to attracting both destination
guests and local and regional guests to Whistler Blackcomb year round. In addition, the Whistler
Mountain Bike Park is a world-renowned lift-accessed mountain bike park that is an important and
growing driver of summer and fall regional and destination visitation.
In addition, zip trekking, mini golf, alpine sliding, wall climbing, ATV tours and a host of other activities
are offered to drive summer visitation. Some of these activities are concessioned to third party operators
with Whistler Blackcomb collecting a royalty fee. These summer activities provide Whistler Blackcomb
with revenues that cover the cost of operations during the summer months.
The Resort Municipality of Whistler also offers an array of non-ski season activities, such as golf, hiking,
mountain biking, canoeing, rafting, kayaking, swimming, comprehensive children’s activities, and a
variety of festivals.
Strategy
The Company’s mission is to create memories as the best mountain resort experience again and
again. The Company considers its mission to be its purpose statement – it is why it exists; it is its unique
value proposition. In carrying out its mission, the Company will use its core values as a guide: Safety
First; Striving to be the Best; and We Care.
The Company’s vision is to be the number one mountain resort in the world…to play, to work and to
invest. The Company’s vision is where it wants to be in the future. The Company will measure its success
in achieving its vision by monitoring the following metrics:


1
To play: year round guest visits, Net Promoter Score1, and recognition as one of the top mountain
resorts in the world by various media publications;
To work: Employee Engagement Score2, eligible employees enrolled in the Company’s registered
retirement savings plan matching program, and recognition as one of Canada’s top employers;
“Net Promoter Score” is the percentage of guests who rate us a nine or above on a 10 point scale in guest surveys asking if they would
recommend us to their family and/or friends, less the percentage of guests who rate us a six or below for the same question.
8

To invest: the Company believes that if it achieves its objectives with respect to being the best
place to work and to play its business will be a desirable investment opportunity.
In order to move towards achieving its vision, the Company’s strategy is designed to grow visits, revenue
per visit and Adjusted EBITDA primarily by enhancing guest experience through product and service
leadership.
The Company’s strategic focus includes a disciplined capital allocation process that contemplates
investing capital strategically to improve guest experience and drive growth. The capital strategy
includes:
 Upgrading and/or expanding ski mountain facilities and infrastructure;
 Expanding the Company’s non-ski business (mountain and attractions); and
 Other strategic investments.
If the Company is successful on these fronts, it expects to grow visits and revenue, which should result in
higher Adjusted EBITDA and cash flow available for capital investment.
The Company believes that it has certain competitive advantages that should help it achieve its strategic
objectives. These advantages include:





Capacity: Whistler Blackcomb is currently the largest mountain resort in North America with
over 8,000 acres of terrain developed. Under the terms of its agreements with the Province of
British Columbia, the Company has in excess of 2,000 additional acres for future expansion,
giving it the physical capacity for future growth;
Diversification: the Company has a range of ancillary businesses that account for roughly 50% of
its revenue, and intend to diversify further its revenue sources. In addition, the Company’s strong
summer business provides seasonal diversification, and the variety of visitors from around the
world to our resort provides geographic diversity (in Fiscal 2015 approximately 49% of skier
visits and 60% of summer visits are from outside the region, with no one country being
dominant);
Demographics: according to third party research, approximately 70% of Whistler Blackcomb’s
guests are under the age of 45, which the Company believes is favourable compared to other
major mountain resorts and demonstrates that Whistler Blackcomb appeals to a broad range of
demographic groups;
Industry leading summer business: the Company’s summer business is a mirror of its winter
business, except it is focused on mountain biking, hiking and sightseeing, and in Fiscal 2015
accounted for approximately 18% of its total revenue. The Company believes that increasing
summer visitation to Whistler provides strong growth potential;
Regional population and market share: Populations in Seattle and its surrounding areas, Metro
Vancouver and the communities in close proximity to the Resort Municipality of Whistler are
expected to grow significantly over the next 15 years. These regions have a population of
approximately 8.4 million and are expected to grow by 25%, or to approximately 10.6 million, by
2030.3 Given improved transportation access, proximity to major population centers, a unique,
comprehensive product offering, and a significant resort accommodation base, Whistler
Blackcomb is well positioned to attract additional local and regional guests;
2
“Employee Engagement Score” is calculated as the average of all favourable (positive) scores on a five-point scale of an employee
engagement survey in which all employees participate.
3
Based on information contained in BC Stats “British Columbia Population Projections 2012-2036, September 2012” and State of
Washington Office of Financial Management “Final 2012 GMA Population Projects”.
9


Access: in the years leading up to the 2010 Winter Olympic Games that were hosted in Whistler,
approximately $2 billion was spent by various levels of government on improvements to highway
and airport infrastructure. These investments dramatically improved access for all guests to
Whistler Blackcomb; and
Olympic exposure and capital investment: hosting the Olympic Winter Games in 2010 provided
Whistler Blackcomb with significant media coverage and media broadcasts were estimated to
have reached 3.5 billion viewers globally. According to surveys conducted by Tourism Whistler,
top of mind awareness for the resort grew dramatically in the Company’s key markets of the
United Kingdom, Australia and Germany, among others. In addition, there were significant
capital improvements to the resort and our mountains in the years leading up to the Olympic
Games, including $26 million invested in a state-of-the-art snowmaking system and terrain
improvements by the Vancouver Olympic Organizing Committee.
The Company believes these competitive advantages position us well for achieving its vision.
The Company continuously evaluates growth opportunities, some of which are contingent upon the
renewal of its Development Agreements and approval of its Master Plans see “Risk Factors – Risks
Related to Whistler Blackcomb - Reliance on Agreements with the Province to Operate Whistler
Blackcomb”.
In-resort growth opportunities may include, amongst other things: (i) acquisition or development of
businesses in the adventure, retail, rental, food and beverage segments, (ii) new lifts, trails, mountain
restaurants, lodges, snowmaking systems and other facilities, (iii) improvements to existing lifts, trails,
mountain restaurants, lodges, snowmaking systems and other facilities with a view of enhancing guest
experience or adding more access capacity, (iv) development of real estate, (v) new on-mountain winter
activities such as snow tubing and night skiing, (vi) new year round on-mountain attractions such as
mountain coasters, indoor adventure facilities and water based attractions, and (vii) new summer onmountain attractions such as rock climbing, ziplines, tree canopy adventures and obstacle courses, crosscountry mountain biking trails and expanding Whistler Blackcomb’s lift serviced mountain biking,
sightseeing and hiking operations. In addition to growth opportunities in or around the Resort
Municipality of Whistler, the Company may from time to time evaluate and pursue other growth
opportunities and acquisitions outside of Whistler that are consistent with its mission and vision.
Some of the above in-resort growth opportunities are discussed in the Company’s draft Master Plans
which are available on the Company’s website at http://www.whistlerblackcomb.com/holdings/
home.aspx (the “Master Plans”). The Master Plans set forth Whistler Blackcomb’s vision for the future
and will be periodically reviewed and updated once approved by the Province of British Columbia.
Readers are reminded that visions of the future are by their nature subject to change. In addition, growth
opportunities and acquisitions may involve significant risks. There is no guarantee that Whistler
Blackcomb will be able to realize or complete any of the growth opportunities or acquisitions referred to
above or presented in the draft Master Plans. Please see “Risk Factors – Risks Related to Whistler
Blackcomb – Reliance on Agreements with the Province to Operate Whistler Blackcomb” and “Risk
Factors – Risks Related to Whistler Blackcomb – Growth Projects and Potential Acquisitions”.
10
BUSINESS OF THE COMPANY
The following table provides a breakdown of the sources of Whistler Blackcomb’s revenue:
(in thousands)
Fiscal 2015
% of Total
Fiscal 2014
% of Total
Fiscal 2013 % of Total
Revenue
Lift Operations……………………………….
$127,066
49%
$128,098
50%
$123,289
51%
Retail and Rental Operations………………...
54,480
21%
46,894
19%
40,332
17%
Food and Beverage Operations……………....
29,595
11%
30,944
12%
30,155
13%
11%
27,755
11%
25,536
11%
8%
20,826
8%
21,468
9%
$254,517
100%
$240,780
100%
Snow and Bike School
Operations………………………..
Other Resort Operations……………………...
30,178
20,935
$262,254
Amounts for Fiscal 2015, Fiscal 2014, and Fiscal 2013 have been derived from the Company’s
consolidated financial statements prepared in accordance with GAAP.
See the consolidated financial statements of the Company for Fiscal 2015 and the related Management’s
Discussion and Analysis of Financial Condition and Results of Operations available on SEDAR at
www.sedar.com for further information regarding the Company’s results of operations for Fiscal 2015.
Lift Operations
Lift operations comprise the largest single division for Whistler Blackcomb and represents the key
revenue generator throughout the year. Whistler Blackcomb is open for skiing from November through
May of each year, with a number of passenger lifts remaining open from May through October for
summer activities, including sightseeing, hiking, glacier skiing and mountain biking.
Whistler Blackcomb lift operations are located on Crown Land. See “Business of the Company Whistler and Blackcomb Development Agreements and Governmental Regulations”.
Over the past two fiscal years, lift ticket revenue from ski operations represents approximately 83% of the
total lift operations revenue, with the remainder generated by summer activities. The volume of lift
tickets sold, together with the pricing and mix of lift tickets, drive revenues from lift operations. Over the
last ten years, Whistler Blackcomb has averaged approximately 2.0 million skier visits per year.
11
Over the last ten years Whistler Blackcomb’s ETP increased at a compound annual growth rate of 4.49%.
Whistler Blackcomb sells a variety of lift ticket products targeting particular customer segments,
including single-day and multi-day tickets, frequency cards and season passes. In Fiscal 2015,
approximately 32% of total lift ticket revenue was collected prior to December 31, 2014. .
Season passes (providing unlimited mountain access during the season) and frequency cards (providing
multi-day mountain access) sales provide revenue stability and strong visibility on ski season sales. Over
the past two fiscal years, approximately 39% of total ski lift ticket revenue has been derived from the sale
of season passes and frequency cards to local and regional guests who generally display a high level of
loyalty to Whistler Blackcomb and in many cases are owners of real estate in the Resort Municipality of
Whistler and the surrounding areas.
Destination guests typically generate higher total revenue per guest visit because they are greater
consumers of Whistler Blackcomb’s non-ticket amenities such as snow and bike school, retail and rental
stores and food and beverage services. Local and regional guests are generally more price sensitive but
represent the greatest share of season pass product sales.
Snow School Operations
Whistler Blackcomb operates one of the largest snow school programs in North America. Whistler
Blackcomb offers a wide variety of private and group ski and snowboard lessons catering to all ages and
ability levels. Whistler Blackcomb employs approximately 1,100 instructors and every year, the ski and
snowboard school at Whistler Blackcomb provides approximately 60,000 adult group lessons, 140,000
children lessons and 30,000 private lessons, primarily drawn from both the destination and regional guest
segment.
Retail and Rental Operations
Shopping is generally an important part of the overall guest experience and a diverse array of attractive,
quality shops are a vital component of the total resort model. Whistler Village contains more than 215
retail outlets, of which Whistler Blackcomb owns and operates 18 retail outlets. Whistler Blackcomb’s
retail outlets are located on both Whistler Mountain and Blackcomb Mountain and in Whistler Village.
12
The shops located on either Whistler Mountain or Blackcomb Mountain generally sell ski accessories
such as goggles, sunglasses, hats and gloves, while the shops located in the Whistler Village sell those
same items as well as hard goods, such as skis, snowboards, boots and other soft goods, such as jackets
and snowsuits, mountain bikes and related gear. The majority of Whistler Blackcomb retail locations
offer Whistler Blackcomb’s own logo-wear which generally provides higher profit margins to Whistler
Blackcomb than other retail products. Three Whistler Blackcomb retail locations sell clearance
merchandise, two in Whistler Village and one in Squamish, British Columbia.
As part of delivering an extraordinary guest experience and convenience to all visitors, in particular
destination guests, Whistler Blackcomb offers a large rental fleet of ski and snowboard equipment. A
majority of rental sales is generated from destination guests, as regional guests generally tend to use their
own equipment. Whistler Blackcomb operates 22 rental shops offering more than 10,000 ski and
snowboard units for rent. Whistler Blackcomb has the largest fleet of rental equipment in the Resort
Municipality of Whistler, a competitive advantage for this high margin business. These outlets offer a
variety of equipment for skiing, snowboarding and mountain biking, with the rental shops carrying a line
of pro-equipment as well as standard fleet equipment.
Food and Beverage Operations
Food and beverage operations comprise an important component in providing an overall complete guest
experience. Whistler Blackcomb provides a variety of dining choices, including restaurants, bars, cafés,
warming huts, cafeterias and upscale dining options.
Whistler Blackcomb operates 18 restaurants and bars: (three large lodges, two full-service restaurants and
seven satellite outlets on Whistler Mountain and Blackcomb Mountain and six base area outlets), with
total indoor seating capacity of approximately 4,500. Whistler Blackcomb is the exclusive operator of
on-mountain food and beverage facilities on both Whistler Mountain and Blackcomb Mountain. The onmountain lodges offer market-style service and indoor seating capacity for approximately 3,500 guests.
Whistler Blackcomb also operates an additional 1,000 seats in its valley facilities, primarily in full service
bars/restaurants. Maintaining control over all on-mountain and a significant proportion of the base-area
food services has enabled Whistler Blackcomb to capture a large proportion of the guest food and
beverage spending as well as ensure product and service quality.
Other Resort Operations
Whistler Blackcomb’s other resort operations includes a number of supporting businesses, including
Whistler Heli-Ski, lodging management for approximately 250 condo hotel units, employee housing,
activities, Resort Reservation Whistler and event management. Whistler Heli-Ski hosts some of the more
adventurous visitors to Whistler Blackcomb, taking them on guided heli-skiing day trips throughout the
regional area. Whistler Blackcomb manages three condo-hotel buildings within the Creekside base area,
sharing the revenue with the home owners. Whistler Blackcomb employee housing has accommodation
for up to 1,230 seasonal staff and is critical to ensuring a proper employee base for Whistler Blackcomb.
Whistler Blackcomb also generates or receives revenue from numerous winter and summer activities,
including snowmobiling, snowtubing, zip trekking, mini golf, alpine sliding, wall climbing, horseback
riding and ATV tours. Some of these activities are concessioned to third party operators with Whistler
Blackcomb collecting a royalty fee. Resort Reservation Whistler books travel, accommodations and lift
and snow and bike school products for guests and is a key engine for driving demand. The numerous
sporting, music and cultural events held throughout the year in Whistler are also designed to create
additional demand during periods with historically lower volumes of activity.
13
Real Estate Activities
Whistler Blackcomb has historically developed and sold properties for both commercial and residential
use in the Whistler Village and the surrounding area. These activities have not been a source of revenue
for the Company since its IPO in 2010.
Whistler Blackcomb has entitlements for 134 bed units, none of which have been allocated to any specific
project. Although Whistler Blackcomb does not have specific plans for these entitlements, deployment of
this asset, by Whistler Blackcomb or another party to which Whistler Blackcomb could transfer these
entitlements, could include the redevelopment of existing property or the acquisition of property, both of
which would require appropriate zoning and other approvals from local and possibly provincial
authorities.
Marketing
Whistler Blackcomb, in collaboration with its business marketing partners, including Tourism Whistler,
Whistler.com and the major branded hotels such as the Four Seasons, Fairmont, the Westin, Pan Pacific
and Hilton, use their combined extensive marketing resources and programs to promote the unique
amenities and services offered by Whistler Blackcomb and at the Resort Municipality of Whistler.
Whistler Blackcomb is a member of Tourism Whistler, which promotes the Resort Municipality of
Whistler as an international destination in order to increase overnight visits. Dave Brownlie, President
and Chief Executive Officer of the Company, and Stuart Rempel, Senior Vice President Marketing and
Sales of the Company, are on the board of directors of Tourism Whistler. Whistler Blackcomb also
coordinates marketing efforts with its strategic partners in order to share marketing plans and media
opportunities, coordinate and complement coverage and exposure, enhance marketing coverage and
marketing plans and identify target markets.
The primary objectives of Whistler Blackcomb’s marketing strategy are to: (i) increase awareness and
market share of Whistler Blackcomb among North American, European, Asian and Australian ski and
mountain resort visitors, (ii) build demand for visits to Whistler Blackcomb during both peak and nonpeak periods, (iii) increase repeat customers to Whistler Blackcomb, (iv) expand the summer and other
off-season businesses of Whistler Blackcomb, and (v) increase Whistler Blackcomb’s total share of
visitor spending. Utilizing market research information gathered from customers, guests and employees,
as well as information available from Tourism Whistler’s extensive research, Whistler Blackcomb
designs its marketing programs to target particular customers, guests and season segments. Whistler
Blackcomb, through a third-party, performs surveys throughout the ski season to determine various
characteristics of their guests, including where the guests are from, that are useful in designing lift ticket
products and marketing campaigns. The results of these surveys are statistically extrapolated over the
total ski visits to determine the estimated number of destination and local and regional guests.
Traditional marketing media, such as television and print media in ski industry and lifestyle publications,
direct marketing, as well as strategic partnerships and sponsorship initiatives, are also used as part of
marketing Whistler Blackcomb, in addition to a successful social media strategy.
Whistler Blackcomb’s marketing programs will continue to leverage the significant global media
exposure gained from the 2010 Olympic Winter Games, during which an estimate 3.5 billion viewers
were exposed to the Whistler Blackcomb brand. Whistler Blackcomb is also a leader in event marketing
and production with world-class events such as the World Ski and Snowboard Festival and the
Crankworx mountain bike festivals presented in Canada, New Zealand and France, drawing significant
attendance and media exposure to Whistler Blackcomb and its associated brands. Whistler Blackcomb
14
and the Whistler area have world-class facilities such as the Whistler Mountain alpine race venues, World
Championship Half Pipe, Whistler Olympic Park (Nordic) and Whistler Olympic Sliding Centre, making
it an ideal venue for a number of events and competitions.
Sales
Whistler Blackcomb’s sales efforts are focused on: (i) sales to independent travelers; (ii) sales to meeting,
incentive and social groups; and (iii) local and regional sales. Independent travelers, meeting and
incentive and social groups are mainly destination visitors.
Whistler Blackcomb’s sales efforts related to independent travelers occur primarily in Canada, the United
States, the United Kingdom and Australia, as well as in secondary markets such as Germany, Brazil,
Mexico and Japan. Whistler Blackcomb works closely with Tourism Whistler and branded hotels in these
sales efforts. Whistler Blackcomb sells both directly and through sales partners to independent travelers
in North America and primarily through sales partners and tour operators in other markets.
Whistler Blackcomb’s sales efforts for meeting, incentive and social groups focus on leisure groups that
will use the amenities and services offered by Whistler Blackcomb and the Resort Municipality of
Whistler. Whistler Blackcomb’s group sales team works closely with the Resort Municipality of
Whistler’s major hotel brands, such as the Four Seasons, Fairmont, the Westin, Pan Pacific and Hilton,
and Tourism Whistler to attract group business to Whistler Blackcomb and the Resort Municipality of
Whistler. The Whistler Conference Centre, which is operated by Tourism Whistler, attracts large
convention groups to the Resort Municipality of Whistler and Whistler Blackcomb works closely with
Tourism Whistler to enable these large convention groups to access the amenities and services offered by
Whistler Blackcomb. Whistler Blackcomb also benefits from the new Vancouver Convention Centre,
which results in an increase in the number of group trips to the Resort Municipality of Whistler and
Whistler Blackcomb before and after conventions in Vancouver. Whistler Blackcomb’s regional sales
focus on corporate sales and student sales in British Columbia and additional sales through regional third
parties such as 7-Eleven, transportation providers and lodging partners.
Employees
Whistler Blackcomb currently employs approximately 500 year round and 3,400 seasonal employees.
None of Whistler Blackcomb’s employees are party to a collective bargaining agreement or represented
by a labour union. Whistler Blackcomb recruits staff from across Canada and several international
locations; including, but not limited to Australia, New Zealand, and the United Kingdom. Although
Canadians make up 75% of the workforce, Whistler Blackcomb considers its international staff as an
asset for regional and destination guests, and believes this recruitment expands Whistler Blackcomb’s
brand awareness. Whistler Blackcomb considers its relations with its employees to be strong and has
been named one of Canada’s Top 100 Employers for Young People and one of British Columbia’s Top
50 Employers for four years in a row. All of Whistler Blackcomb’s employees, other than certain Named
Executive Officers, are employed by Whistler Blackcomb Employment Corp., a wholly-owned subsidiary
of the Company. Whistler Blackcomb operates seven employee housing buildings and leases eight
residential houses providing accommodation for approximately 1,230 seasonal staff.
Whistler and Blackcomb Development Agreements and Governmental Regulation
Whistler Mountain and Blackcomb Mountain are located on Crown Land within the traditional territory
of the Squamish and Lil’wat Nations. The relationship between Whistler Blackcomb and the Province is
largely governed by the Whistler Development Agreement between the Province and Whistler L.P. and
the Blackcomb Development Agreement between the Province and Blackcomb L.P. The Development
15
Agreements require that each of the mountains be developed, operated and maintained in accordance with
its respective master plan, which contains requirements as to matters such as trail design and
development, passenger lift development and environmental concerns. The Development Agreements
cover the entire area of the mountains and provide for the granting of three categories of development
rights to the Partnerships: licenses, rights of way and leases.
The term of each of the Whistler Development Agreement and the Blackcomb Development Agreement
is 50 years. The Whistler Development Agreement runs from September 30, 1982 through September 30,
2032. The Whistler Development Agreement contains a right, exercisable by and at the option of
Whistler L.P., between the 30th anniversary and the 47th anniversary of the date of the agreement, to
renew the Whistler Development Agreement on terms and conditions consistent with the Provincial Ski
Area policy then in effect. The renewal terms are subject to approval by the Province. The Blackcomb
Development Agreement runs from May 1, 1979 through May 1, 2029, and does not specify any renewal
right or renewal terms.
The Province and the Partnerships are currently pursuing the updating of the Development Agreements to
a new standard form development agreement used by the Province throughout British Columbia with a
60-year renewal term or, at minimum, an extension for an additional 10 years. Discussions are
progressing with the Province and the process of consultation with First Nations is underway.
Under the Development Agreements, royalties equal to 2% of gross revenue earned from the use of lifts
and any other mountain recreational improvements are payable by the Partnerships to the Province. In
Fiscal 2015, Whistler Blackcomb incurred $2.52 million payable to the Province pursuant to the
Development Agreements. The Development Agreements provide for a potential increase in fees, which
is assessed every ten years. However, any increase in the royalty cannot be more than 1% for Whistler
Mountain and 0.5% for Blackcomb Mountain. In addition, any fee increase must be in line with the
highest fee then charged by the Province under any provincial ski area policy then in effect, the highest of
which is currently 2%. See “Risk Factors — Reliance on Agreements with the Province to Operate
Whistler Blackcomb”.
The Province also regulates certain aspects of Whistler Blackcomb’s operations, including liquor
licensing and food safety regulations applicable to Whistler Blackcomb’s food and beverage operations
and safety standards relating to Whistler Blackcomb’s lift operations and heli-ski operations. Any future
real estate development by Whistler Blackcomb would be subject to zoning regulations and approval
requirements imposed by the Resort Municipality of Whistler.
Intellectual Property
Whistler Blackcomb relies on trademark laws to protect certain aspects of its business. Whistler
Blackcomb’s registered trademarks and tradenames in Canada include the following: “Whistler
Blackcomb”, “Peak 2 Peak”, “Blackcomb”, “Crankworx” and other related design trademarks. Whistler
Blackcomb also relies on a combination of unregistered trademark and tradename rights to protect
Whistler Blackcomb as a branded business with strong name recognition.
Monitoring the unauthorized use of Whistler Blackcomb’s intellectual property is difficult, and the steps
Whistler Blackcomb has taken, including sending demand letters and taking actions against third parties,
may not prevent unauthorized use by others. The failure to adequately build, maintain and enforce
Whistler Blackcomb’s intellectual property portfolio could impair the strength of Whistler Blackcomb
brands. See “Risk Factors — Trademarks and Brand Value”.
16
Sustainability
Whistler Blackcomb is committed to sustainable operations and reducing the environmental impact of its
operations though its goal of reaching a zero operating footprint with zero waste, zero carbon and zero net
emissions. Whistler Blackcomb has taken steps to reduce waste and energy consumption, protect special
mountain eco-systems, promote sustainability awareness and be an active participant in community
environmental initiatives. Since 1997, Whistler Blackcomb has won over 30 awards recognising
environmental initiatives and culture, including being named One of Canada's Greenest Employers by
Mediacorp Canada, editors of Canada’s Top 100 Employers project, for the last seven consecutive years
(2009-2015), the 2012 BC Hydro Power Excellence Award Winner in the Power Smart Leader category,
and the Power Smart Leadership Excellence award in 2014 for achieving greater levels of energy savings
year-over-year. Whistler Blackcomb has been awarded Golden Eagle Awards for Overall Environmental
Excellence by a Ski Resort in North America for 2003, 2005 and 2010 and seven Silver Eagle Awards for
Overall Excellence by a Ski Resort by the National Ski Area Association.
RISK FACTORS
An investment in the Common Shares involves a high degree of risk. You should consider and read
carefully all of the risks and uncertainties described below, together with all of the other information
contained in this Annual Information Form, before deciding to invest in the Common Shares. If any of
the following risks actually occur, Whistler Blackcomb and its performance could be materially adversely
affected and the performance, financial condition, results of operations or cash flows of the Company
could be materially adversely affected. In any such case, the trading price of the Common Shares could
decline, and you could lose all or part of your investment. The risks below are not the only ones which
the Company faces. Additional risks not currently known to the Company or that the Company currently
deems immaterial may also have adverse effects. This Annual Information Form also contains forwardlooking statements that involve risks and uncertainties. The actual results of the Company could differ
materially from those anticipated in the forward-looking statements as a result of specific factors,
including the risks described below. See “Reference Information – Forward Looking Statements”.
Risks Related to Whistler Blackcomb
Unfavourable Weather Conditions
Whistler Blackcomb’s ability to attract visitors to its resort is influenced in part by weather conditions, the
amount and timing of snowfall during the winter season, and the number of sunny days in the summer
season. In particular, the early season snow conditions and skier perceptions of early season snow
conditions can influence the momentum and success of the overall winter season, including pre-season
sales of season passes and frequency cards. Unfavourable weather conditions can adversely affect
Whistler Blackcomb’s operations as vacationers tend to delay or postpone winter vacations if conditions
differ from those that typically prevail for a given season.
In addition, unseasonably warm weather may result in inadequate natural snowfall, which increases the
cost of snowmaking, and could render snowmaking wholly or partially ineffective in maintaining quality
skiing conditions. Excessive natural snowfall may materially increase the costs incurred for grooming
trails and may also make it difficult for visitors to obtain access to Whistler Blackcomb.
Prolonged periods of adverse weather conditions, or the occurrence of such conditions during peak
visitation periods, could have a material adverse effect on Whistler Blackcomb and its performance and
the financial condition, results of operations and cash flows of the Company.
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It is difficult to predict the specific regional and local climatic impacts of global climate change. A
milder local climate at the Resort Municipality of Whistler could give rise to shorter winter seasons. The
effect of that kind of climate change would have an impact on Whistler Blackcomb and its prospects, and
the financial condition, results of operations and cash flows of the Company, which the Company is
unable to quantify but could be material.
Sensitivity to Economic Conditions
Skiing and vacation travel are discretionary recreational activities with relatively high participation costs
and are adversely affected by economic downturn or weak economic conditions. An actual or perceived
period of economic downturn or weak economic conditions in Canada, the United States and the rest of
the world could reduce consumer spending on recreational activities, result in declines in visits and
revenue or in a change in booking trends and could have a material adverse effect on Whistler
Blackcomb, its performance and the financial condition, results of operations and cash flows of the
Company. In addition, Whistler Blackcomb is the premier ski resort destination in North America and
accordingly charges some of the highest prices for lift tickets and ancillary services in the North
American ski resort industry, which could further exacerbate the impact of an economic downturn or
weak economic conditions.
Leisure and Business Travel
Whistler Blackcomb’s business is sensitive to the willingness of its guests to travel. Acts of terrorism, the
spread of contagious diseases, regional political events and developments in military conflicts in areas of
the world from which Whistler Blackcomb draws its guests could depress the public’s willingness to
travel and cause severe disruptions in both domestic and international air travel and consumer
discretionary spending. This could reduce the number of visitors to the resort and have an adverse effect
on Whistler Blackcomb. Many of Whistler Blackcomb’s guests travel by air and the impact of higher
prices for commercial airline services and availability of air services could cause a decrease in visitation
by destination guests to the resort.
Also, many of Whistler Blackcomb’s guests travel by vehicle and higher gasoline prices could adversely
impact Whistler Blackcomb’s guests’ willingness to travel to the resort. Higher cost of travel may also
affect the amount that guests are willing to spend at the resort and could negatively impact the
Partnerships’ revenue, particularly for lodging, snow and bike school, dining and retail/rental.
Also, a decline in the reputation of the Resort Municipality of Whistler and its amenities could adversely
impact Whistler Blackcomb’s guests’ willingness to travel to its resort.
A decrease in leisure and business travel could have a material adverse effect on Whistler Blackcomb and
its performance, and the financial condition, results of operations and cash flows of the Company.
Seasonality of Operations
Resort operations are highly seasonal. Although the timing and the amount of snowfall can influence the
number and type of skier visits, the majority of the skier visits are from late December to the end of
March. The quarter ending March 31st generates the highest revenue and Adjusted EBITDA.
Furthermore, a significant portion of revenue is generated on certain holidays, particularly Christmas and
New Year, school spring breaks, and on weekends. Problems such as the occurrence of any of the risk
factors discussed herein during these peak periods could have a material adverse effect on Whistler
Blackcomb and its performance, and the financial condition, results of operations and cash flows of the
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Company. The operating results for any particular quarter are not necessarily indicative of the operating
results for a subsequent quarter or for the full fiscal year.
Capital Intensive Industry
Whistler Blackcomb operates in a capital-intensive industry and has made significant capital expenditures
to establish Whistler Blackcomb’s competitive position. There can be no assurance that Whistler
Blackcomb will have adequate funds, from internal or external sources, to make all planned or required
capital expenditures to construct, maintain and renovate its facilities. A lack of available funds for such
capital expenditures could have a material adverse effect on Whistler Blackcomb’s ability to implement
its operating and growth strategies.
In addition, Whistler Blackcomb’s ability to construct, maintain and renovate its facilities is subject to a
number of risks, including: delays or cost overruns, permits or authorizations requirements, governmental
restrictions on development, force majeure events, design defects and environmental issues. Whistler
Blackcomb’s ability to compete effectively, and its prospects, the financial condition, results of operations
and cash flows of the Company could be materially adversely affected if Whistler Blackcomb is unable to
complete capital projects on schedule or if such investments fail to improve the facilities in the manner
expected.
Currency Fluctuations
A significant portion of the destination guests as well as some regional guests are from locations outside
Canada. As a result, a significant increase in the value of the Canadian dollar, particularly against the
U.S. dollar, British pound, European euro and Australian dollar (or a significant decrease in the value of
such currencies against the Canadian dollar), could impact visits and could have a material adverse effect
on Whistler Blackcomb and its prospects and the financial condition, results of operations and cash flows
of the Company.
Reliance on Agreements with the Province to Operate Whistler Blackcomb
Whistler Mountain and Blackcomb Mountain are located on Crown Land within the traditional territory
of the Squamish and Lil’wat Nations. The operations and future development of Whistler Mountain and
Blackcomb Mountain as a ski resort are governed by the Development Agreements. The Development
Agreements set out that each of Whistler Mountain and Blackcomb Mountain must be developed in
accordance with its respective master plan, which contain details such as trail design, passenger lift
development and environmental considerations.
The term of the Whistler Development Agreement is 50 years extending from September 30, 1982 to
September 30, 2032. The Whistler Development Agreement contains a right, exercisable by and at the
option of Whistler L.P., between the 30th anniversary and the 47th anniversary of the date of the
agreement, to renew the Whistler Development Agreement on terms and conditions consistent with the
Provincial Ski Area policy then in effect. The renewal terms are subject to approval by the Province. The
term of the Blackcomb Development Agreement is 50 years from May 1, 1979 to May 1, 2029. The
Blackcomb Development Agreement does not specify any renewal option or renewal terms.
The Province and the Company are currently in the process of updating the Development Agreements to a
new standard form master development agreement to be used throughout British Columbia with a 60-year
renewal term or, at minimum, an extension for an additional 10 years. Discussions are progressing with
the Province and the process of consultation with First Nations is underway. While management believes
there is a clear understanding among the Province, the Company and the Partnerships that the right to
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operate Whistler Blackcomb will continue indefinitely if the owner of Whistler Blackcomb continues to
operate in a responsible way, there can be no assurance that an agreement on extending or renewing the
Development Agreements, or entering into new development agreements with the Province, will occur.
The Company’s inability to operate Whistler Blackcomb or to extend, renew or renegotiate the
Development Agreements could have a material adverse effect on its performance, and financial
condition, results of operations and cash flows. In addition, any such extension or renewal of the
Development Agreements or entry into a new agreement may entail the Province having to satisfy its duty
to consult, and where necessary accommodate, First Nations regarding their asserted Aboriginal rights
and title. The Squamish First Nation and the Lil’wat First Nation assert Aboriginal rights and title within
the tenures held by Whistler Blackcomb. Recent court decisions on the Crown’s duty to consult with
Aboriginal groups may influence how the Province approaches its constitutional obligations to the
Squamish and Lil’wat First Nations in connection with the renewal of the Development Agreements and
approval of the Master Plans, which may impact the scope of some of the growth projects identified in the
Master Plans and the terms and the timing of the renewal of the Development Agreements. The
Company’s inability to obtain approval for its Master Plans, timely renew or extend the Development
Agreements or negotiate commercial terms acceptable to the Company may have a material adverse effect
on the Company’s prospects, performance, financial condition, results of operations and cash flows.
On June 4, 2014, the British Columbia Supreme Court ruled that the Province and the RMOW had failed
to adequately consult the Squamish and Lil’wat Nations regarding the 2011 Official Community Plan (the
“2011 OCP”) in Squamish Nation v. BC (Community, Sport and Cultural Development) (the “OCP
Decision”). As a result, the 2011 OCP was set aside. In the OCP Decision, the judge commented that
although he could not make detailed findings regarding the strength of the Aboriginal title claim on the
hearing of a judicial review petition, he felt there was evidence that the Squamish and Lil’wat Nations
have a strong prima facie claim to Aboriginal title. The focus of the Court in the OCP Decision was not to
rule on a claim of Aboriginal title but rather to assess, based on the affidavit evidence submitted by the
parties, whether the Province had fulfilled its duty to consult the Squamish and Lil’wat Nations prior to
the adoption of the 2011 Official Community Plan. While the area discussed in the OCP Decision may
include certain lands within Whistler Blackcomb’s tenure, to date, no claim of Aboriginal title to any
portion of Whistler Blackcomb’s tenure has been adjudicated and no First Nation has established
Aboriginal title within Whistler Blackcomb’s tenure.
On June 26, 2014, the Supreme Court of Canada (the “SCC”) released its decision in Tsilhqot’in Nation v.
British Columbia (the “Tsilhqot’in Decision”). In the Tsilhqot’in Decision, the SCC recognized that
Aboriginal title to land exists and provided guidance on the evidence that Aboriginal groups must provide
to establish title, including sufficiency, continuity and exclusivity of use. While the Company does not
operate in the area involved in the Tsilhqot’in Decision and Aboriginal title hasn’t been established in the
area overlapping with Whistler Blackcomb’s tenure, the OCP Decision and the Tsilhqot’in Decision may
result in delays with the approval and execution of the Development Agreements and Master Plans.
Although the OCP Decision and the Tsilhqot’in Decision may create some uncertainty as to the timing of
the Company’s ability to execute some of the growth projects identified in its Master Plans, the Company
does not currently expect that these decisions will lead to any fundamental changes in how Whistler
Blackcomb operates.
Competition
Whistler Blackcomb operates in a competitive industry and competes with mountain resort areas in the
United States, Canada and Europe for destination visitors and with several ski areas in the region around
the Resort Municipality of Whistler for local and regional visitors. New mountain resorts that may be
developed in the region around the Resort Municipality of Whistler may lead to increased competition.
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Garibaldi at Squamish, a proposed destination all season resort currently being reviewed by the
Provincial, First Nation and municipal governments, is such a proposed mountain resort. If approved and
constructed, Garibaldi at Squamish would be located approximately 26 kilometers south of Whistler
which would increase competition for winter and summer visitations and may have an adverse impact on
the Company’s prospects, financial condition, results of operations and cash flows. Whistler Blackcomb
also competes with other worldwide recreation resorts, including warm-weather resorts, for vacation
guests outside the traditional ski season.
Whistler Blackcomb’s major North American competitors include the major Colorado and Utah ski areas,
the Lake Tahoe mountain resorts in California and Nevada, the Quebec and New England mountain
resorts and certain ski areas in the Canadian Rockies. The competitive position of Whistler Blackcomb is
dependent upon many diverse factors such as its proximity to population centers, availability and cost of
transportation to the resorts, including direct flight availability by major airlines, pricing, snowmaking
capabilities, type and quality of skiing offered, duration of the ski season, prevailing weather conditions,
quality of golf facilities, the number, quality and price of related services and lodging facilities, and the
reputation of the resort.
Unanticipated Departure of Key Personnel
The success of Whistler Blackcomb depends in part on its senior management. The unanticipated
departure of key personnel could have a material adverse effect on Whistler Blackcomb and its prospects
and the financial condition, results of operations and cash flows of the Company.
Dependence on a Seasonal Workforce and other Workforce Risks
Whistler Blackcomb’s operations are highly dependent on a large seasonal workforce (3,400 seasonal
workers and many more volunteers). Although many return year after year Whistler Blackcomb is
required to recruit year-round to fill at least one thousand positions each season. The organization
manages seasonal wages and the timing of the hiring process to ensure the appropriate workforce is in
place as needed when needed. Whistler Blackcomb cannot guarantee that material increases in the cost of
securing its seasonal workforce will not be necessary in the future. Furthermore, Whistler Blackcomb
cannot guarantee that it will be able to recruit and hire adequate seasonal personnel as the business
requires.
Whistler Blackcomb is also subject to various provincial and federal laws governing matters such as
minimum wage, overtime compensation, working conditions, immigration and work authorization
requirements, and family and medical leave. Changes to such laws could increase Whistler Blackcomb’s
labour costs. Also, as minimum wage rates increase, Whistler Blackcomb may need to increase not only
the wages of its minimum wage employees but also the wages paid to employees at wage rates that are
above the minimum wage. Labour market pressures in British Columbia (labour and skills shortages) may
pose operational challenges. Whistler Blackcomb recruits a number of foreign nationals as part of its
seasonal workforce in order to fill front line positions. A reform of the Federal government’s
International Experience Canada initiative which enables eligible youths to temporarily work in Canada
for up to two years could limit or impede Whistler Blackcomb’s ability to hire such foreign nationals.
Whistler Blackcomb also hires a limited number of foreign nationals (Temporary Foreign Workers) in
order to fill snow school positions requiring specialized skills. A reform of the Federal government’s
Temporary Foreign Worker Program would not be expected to have a direct adverse impact on Whistler
Blackcomb; however, it is an indicator of future policy restrictions that will impact access to a labour
pool.
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In addition, Whistler Blackcomb may experience non-union employees attempting to unionize from time
to time. Whistler Blackcomb has dealt successfully with union organization drives in the past and
presently no employees are currently unionized. However, Whistler Blackcomb may experience union
activity in the future.
The organization has the capacity to house 1,230 employees in its employee housing buildings and other
rental properties. Primarily reserved for new seasonal staff, some units are occupied by returning
seasonal staff. The home rental and purchase market in Whistler is limited and the ability to provide
employee accommodation may be a restricting factor to continued business growth.
Any of the potential labour impacts described above could adversely impact Whistler Blackcomb’s results
of operations and its prospects and the financial condition, results and operations and cash flows of the
Company.
Impact of Natural Disasters
A severe natural disaster, such as a forest fire, flood, landslide, avalanche or an earthquake, may interrupt
Whistler Blackcomb’s operations, damage its properties and/or reputation, limit road access to the Resort
Municipality of Whistler and reduce the number of guests who visit the Resort Municipality of Whistler.
Damage to properties, roads and affected areas could take a long time to repair. Furthermore, such a
disaster may require evacuations. There is no guarantee that the Partnerships or the Company would have
adequate insurance to cover the costs of repair to its properties or any interruption to its business.
There is one major highway between Vancouver and the Resort Municipality of Whistler. The journey of
most visitors to the resort and employees working in the resort includes travel by vehicle on this highway.
Most supplies to businesses in Whistler are delivered via this highway. Whistler Blackcomb’s business is
highly dependent on visitors and suppliers having access to the resort via the Sea to Sky Highway. A
natural disaster or accident may interrupt or impede such access causing visits to the resort to decrease for
an indefinite period and impairing the ability of resort businesses to provide goods and services.
The ability to attract visitors to the Resort Municipality of Whistler is also influenced by the aesthetics
and natural beauty of the outdoor environment where the resort is located. A severe forest fire or other
severe impacts from naturally occurring events could negatively impact the natural beauty of the Resort
Municipality of Whistler and have a long-term negative impact on guest visitation as it would take several
years for the environment to recover. A severe natural disaster could have a material adverse effect on
Whistler Blackcomb and its performance, and the financial condition, results of operations and cash flows
of the Company.
Credit Facility and Interest Rate Risk
The Credit Facility imposes, and documents governing the Company and the Partnerships’ future
indebtedness may impose, covenants and obligations on the Partnerships, the Company and their
respective subsidiaries limiting the discretion of management with respect to certain business matters.
These covenants and obligations may adversely affect Whistler Blackcomb’s ability to finance future
operations or capital needs, or to engage in other business activities and strategic initiatives that may be in
its long-term best interests.
For example, the Credit Facility restricts the ability of entities forming part of the Whistler Blackcomb
group to, among other things, incur or guarantee additional indebtedness; pay dividends and make other
distributions and restricted payments; make certain loans, acquisitions and other investments; engage in
certain transactions with Shareholders or affiliates; sell certain assets or engage in mergers, acquisitions
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and other business combinations; amend or otherwise alter the terms of any subordinated indebtedness;
and create liens, in each case without the consent of a majority of the lenders. The Credit Facility also
requires, and documents governing the Company and the Partnerships’ future indebtedness may also
require, Whistler Blackcomb to meet certain financial ratios and tests in order to pay dividends,
distributions and other restricted payments; incur additional debt; and make certain loans, acquisitions or
other investments. The ability of Whistler Blackcomb to comply with the above covenants and
restrictions and other provisions of its debt agreements is dependent on future performance, which is
subject to many factors, including many of which are beyond the Whistler Blackcomb’s control. The
breach of any of these covenants or noncompliance with any of the financial ratios and tests could limit
Whistler Blackcomb’s ability to borrow and/or result in an event of default under the Credit Facility and
debt agreements, which if not cured or waived, could result in acceleration of the related debt and
acceleration of debt under other instruments evidencing indebtedness that may contain cross-acceleration
or cross-default provisions. Whistler Blackcomb may not have or be able to obtain sufficient funds to
make these accelerated payments. In addition, any inability to borrow could have an adverse effect on
Whistler Blackcomb’s business, financial condition and results of operations.
The Credit Facility is made available at floating rates of interest. On September 5, 2014, the Partnerships
entered into a four-year, $125 million interest rate swap with a Canadian bank, which has the effect of
fixing the underlying floating interest rate on a portion of the principal amount outstanding under the
Credit Facility. Since then, the term of the swap was extended by two years to September 5, 2020. As at
September 30, 2015, the underlying floating interest rate on approximately 53% of Company’s debt
outstand was effectively fixed for the term of the swap and, as a result, an increase in the underlying
floating rate will increase and could have an adverse effect on the amount of cash available for dividend
payments to Shareholders by the Company.
Adequacy of Insurance Coverage
While the Partnerships and the Company maintain various property damage, business interruptions and
general liability insurance policies, and undertake safety and loss prevention programs to address certain
risks, the insurance policies do not cover all types of losses and liabilities. In some cases, these insurance
policies may not be sufficient to cover the ultimate cost of claims which could exceed policy limits. If the
Partnerships or the Company are held liable for amounts exceeding the limits of its insurance coverage or
for claims outside the scope of that coverage, Whistler Blackcomb and its performance and the financial
condition, results of operations and cash flow condition of the Partnerships and the Company could be
materially adversely affected. In addition, Whistler Blackcomb may not be able to renew its current
insurance policies on favorable terms, or at all. Whistler Blackcomb’s ability to obtain future insurance at
commercially reasonable rates could be materially affected if it or other companies within or outside its
industry sustain significant losses or make significant claims.
Litigation, Governmental Investigations and Indemnities
In the ordinary course of their business, the Company, the Partnerships or all of them have been named,
and may in the future be named, as a defendant or defendants in legal proceedings relating to personal
injury or wrongful death, allegations of violations of laws and regulations, labour and employment,
intellectual property, environmental matters and commercial disputes. For example, the Company and the
Partnerships are from time to time subject to various lawsuits and claims related to injuries occurring at
Whistler Blackcomb, including due to the use, operations or maintenance of our trails, lifts and other
facilities. The Partnerships and the Company may also be the subject of governmental investigations,
including tax-related investigations, from time to time. Litigation and governmental investigations can be
expensive, lengthy and disruptive to normal business operations. Moreover, the results of complex legal
proceedings or governmental investigations are difficult to predict. An unfavourable resolution of
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lawsuits or governmental investigations, including tax-related investigations, could have a material
adverse effect on Whistler Blackcomb and its prospects and the financial condition, results of operations
or cash flows of the Company.
Under various agreements with third parties, the Company and/or the Partnerships have agreed and will in
the future agree to indemnify such third parties in certain circumstances. If these indemnity obligations
were triggered in the future, it could have a material adverse effect on the financial condition and cash
flows of the Company.
Safety and Accident Risk
The safety of guests and employees is a major concern and focus for all officers and employees of
Whistler Blackcomb. While Whistler Blackcomb maintains and promotes an on-mountain safety
program, there are inherent risks associated with its resort activities. Whistler Blackcomb’s guests or
employees may be involved in accidents during the use, operation, or maintenance of ski lifts, rides and
other resort facilities. Although Whistler Blackcomb has devised and implemented emergency plans to
mitigate the consequences in case of serious accident, no assurance can be made that Whistler Blackcomb
is prepared for all possible accidents or unforeseen incidents. An accident or injury at Whistler
Blackcomb or a competing resort that receives media attention could negatively impact Whistler
Blackcomb’s brand or reputation, cause loss of consumer confidence, reduce visitation and negatively
impact the Company’s results. The increased expansion in the use and types of social media compounds
the potential impact of negative publicity.
Environmental Laws and Regulations
Whistler Blackcomb is subject to a variety of federal, provincial 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, climate change and protection of natural
resources. Certain kinds of future expansions of Whistler Blackcomb’s facilities would require it to carry
out environmental assessments and apply for government approvals which may require prior First Nations
consultation to be carried out. Such proposals may not be approved or may be approved with
modifications that substantially increase the cost or decrease the desirability of implementing the project.
Whistler Blackcomb’s facilities are also subject to risks associated with mould and other indoor building
contaminants. From time to time Whistler Blackcomb’s operations are subject to inspections by
environmental regulators or other regulatory agencies. Whistler Blackcomb is also subject to worker
health and safety requirements as well as to land use criteria and potential remediation obligations
applicable to the presence of regulated substances. Management believes that Whistler Blackcomb’s
operations are in compliance with applicable environmental, health and safety requirements in all material
respects. However, efforts to comply do not eliminate the risk that Whistler Blackcomb 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 Whistler Blackcomb now or formerly owned or operated,
newly discovered environmental impacts or contamination at or from any of Whistler Blackcomb’s
properties, or changes in environmental laws and regulations or their enforcement. Liability for any fines,
penalties, damages or remediation costs or changes in environmental laws or regulations could have a
material adverse effect on Whistler Blackcomb and its performance and the financial condition, results of
operations and cash flows of the Company.
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Privacy Laws and Information Technology
Whistler Blackcomb collects guest data, including credit card numbers and other personally identifiable
information relating, for various business purposes, including marketing and promotional purposes
through various forms of media. The integrity and privacy of its guests’ and employees’ information is
important to Whistler Blackcomb and guests have a high expectation that Whistler Blackcomb 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
Whistler Blackcomb’s operating costs and/or adversely impact Whistler Blackcomb’s ability to market its
products, properties and services to its guests. Furthermore, non-compliance with applicable privacy
regulations by Whistler Blackcomb (or in some circumstances non-compliance by third parties engaged
by Whistler Blackcomb), breach of security on systems storing Whistler Blackcomb’s guest or employee
data, a loss of guest or employee data or fraudulent use of guest or employee data could adversely impact
Whistler Blackcomb’s reputation or result in fines or other damages, litigation and regulatory
investigations.
Despite Whistler Blackcomb’s efforts, information networks and systems may be vulnerable to service
interruptions or to security breaches from inadvertent or intentional actions by its employees or vendors,
or from attacks by malicious third parties. Although steps have been taken to address these concerns,
there can be no assurance that a system interruption, security breach or unauthorized access will not
occur. Any such interruption, breach or unauthorized access to Whistler Blackcomb’s network or systems
could adversely affect Whistler Blackcomb’s business operations and/or result in the loss of critical or
sensitive confidential information or intellectual property, and could result in financial, legal, business
and reputational harm.
Whistler Blackcomb transmits confidential credit card information in connection with its various guest
services, including its lift operations, food and beverage operations, rental operations, retail operations,
snow and bike school operations and other operations. Third parties may have the technology or knowhow to breach the security of this customer information, and Whistler Blackcomb’s security measures and
those of its technology vendors may not effectively prevent others from obtaining improper access to this
information. Any security breach could expose Whistler Blackcomb to risks of data loss, litigation and
liability and could seriously disrupt its operations and significantly harm its reputation.
Trademarks and Brand Value
Whistler Blackcomb’s trademarks and tradenames are an important component of its business and the
continued success of Whistler Blackcomb depends in part upon its continued ability to use these
trademarks to increase brand awareness and further develop the “Whistler Blackcomb” brand in both
domestic and international markets. The unauthorized use of these trademarks could diminish the value
of the “Whistler Blackcomb” brand and its market acceptance, competitive advantages or goodwill, which
could adversely affect its business. Litigation has been and may continue to be necessary to enforce the
Partnerships’ or the Company’s intellectual property rights or to determine the validity and scope of the
proprietary rights of others. Additionally, negative public image or other adverse events which become
associated with the “Whistler Blackcomb” brand could adversely affect Whistler Blackcomb and its
prospects, and the financial condition, results of operations and cash flows of the Company. The
accessibility of social media may also give disgruntled visitors and contracting counterparties increased
ability to adversely affect the brand and reputation of Whistler Blackcomb.
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Growth Projects and Potential Acquisitions
Whistler Blackcomb evaluates in-resort growth projects, and acquisitions and other investments in
businesses, properties or assets, from time to time. The Company may actively pursue such opportunities,
some of which could be material. Growth projects and acquisitions can be complex to evaluate, execute
and integrate. There is no certainty that the Company will successfully complete, implement or integrate
future growth projects or acquisitions, which could result in a material adverse effect on the Partnerships
and the Company.
In addition, growth projects and acquisitions carry inherent risk factors such as: misevaluation of benefits
and/or synergies or inability to complete or integrate; diversion of management’s attention; potential
increased debt leverage; litigation arising from growth projects or acquisitions; potential impairment of
goodwill and other intangible assets; contingent liabilities; and unanticipated problems. In addition, there
is a risk that growth projects and acquisitions may fail to perform in accordance with the Company’s
expectations and that costs estimates may prove inaccurate.
Risks Related to Third Party Interests
KSL Capital Partners III GP, LLC
KSL Capital Partners III GP, LLC, through Monroe CA BC Investment, LP, Monroe CA BC
(Alternative), LP, Monroe CA BC Investment SARL and Monroe CA BC Investment II SARL, owns
24% of the Company’s outstanding Common Shares. This concentration of ownership under certain
circumstances could have the effect of delaying or preventing a change in control of the Company.
Future sales of Common Shares by KSL Capital Partners III GP, LLC
The Company has granted registration rights to KSL Capital Partners III GP, LLC, which permits KSL
Capital Partners III GP, LLC to sell all or a portion of its Common Shares through one or more
prospectus offerings. No prediction can be made as to the effect, if any, such future sales of Common
Shares will have on the market price of the Common Shares prevailing from time to time. However, the
future sale of a substantial number of Common Shares by KSL Capital Partners III GP, LLC, or the
perception that such sale could occur, could adversely affect prevailing market prices for the Common
Shares.
Non-controlling Interest of Nippon Cable in the Partnerships
Nippon Cable (directly and through its affiliates) holds a 25% limited partner interest in each of the
Partnerships. Pursuant to the Partnership Agreements, certain Partnership actions require Nippon Cable’s
approval as a limited partner. There is no guarantee that Nippon Cable will act in accordance with the
General Partner’s view of the best interests of the Partnerships in a timely manner, or at all. Nippon
Cable may also in the future be in default of its obligations under the Partnership Agreements. Nippon
Cable’s non-controlling interest in the Partnerships may, as a result, reduce the ability of the Partnerships
to take certain actions or result in a default within the Partnerships that is not within the control of the
General Partner.
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Risks Related to an Investment in the Common Shares
Fluctuations in the Price of Common Shares
The market price of the Common Shares may fluctuate substantially in response to a number of events,
including events that are beyond the Company’s control. Some companies that have had volatile market
prices for their securities have had securities class action lawsuits filed against them. If a lawsuit were to
be filed against the Company, regardless of the outcome, it could result in substantial costs and a
diversion of management’s attention and resources. Stock markets have generally experienced extreme
price and volume fluctuations. Market fluctuations, as well as general political and economic conditions
such as acts of terrorism, prolonged economic uncertainty, a recession or interest rate or currency rate
fluctuation, could adversely affect the market price of the Common Shares.
Distribution Risk
Dividend payments to Shareholders are subject to distributions being received by the Company from the
Partnerships. The distributions of the Partnerships will depend on the results, cash flows and projected
cash requirements of the Partnerships. Certain conflicts of interest could arise as a result of the
relationship among the Company and the Partnerships. As the general partner of each of the Partnerships,
the Company makes all decisions relating to the Partnerships. In such capacity, the Company has a
fiduciary duty to manage the Partnerships in a manner beneficial to their limited partners and, as such,
must exercise good faith and integrity in administering the assets and affairs of the Partnerships. The
directors and officers of the Company who make such decisions also have fiduciary duties to manage the
Company, including its investments in its subsidiaries (including the Partnerships), in a manner beneficial
to the Company and its Shareholders. There is no guarantee that the Partnerships will continue to make
distributions to the Company in the same amounts as historically made by the Partnerships or that the
Company will continue to pay dividends to its Shareholders in the same amounts as historically paid by
the Company.
Future Sales or Issuances may Affect the Price of the Common Shares
Future sales, or the ability for sale, of substantial amounts of the Common Shares in the public market
could adversely affect the prevailing market price for the Common Shares. If the Company’s
Shareholders sell substantial amounts of their Common Shares in the public market, the market price of
the Common Shares could decline. These sales might also make it more difficult for the Company to sell
equity or equity-related securities in the future at a time and price that the Company deems appropriate.
In addition, the Company’s articles of incorporation permit the issuance of an unlimited number of
Common Shares and preferred shares. The Company may issue additional Common Shares or other
equity securities in connection with financing transactions, acquisitions or pursuant to the Omnibus
Incentive Plan. The issuance of additional Common Shares, other equity securities or securities
convertible into Common Shares or equity securities could dilute the economic interest and voting rights
of the Shareholders or adversely affect the market price of the Common Shares. Preferred shares, if
issued, could have a preference with respect to dividends or liquidation entitlement. An issuance of
Common Shares or preferred shares by the Company could adversely affect the prevailing market price
for the Common Shares.
DIVIDENDS
The Company depends on the ability of the Partnerships to make distributions to the Company to pay
dividends, if declared, and to meet the Company’s obligations. The payment of dividends is not
27
guaranteed and the amount and timing of any dividends payable by the Company is at the discretion of
the Board of Directors and is established quarterly on the basis of the Company’s cash flow and earnings,
financial requirements and other relevant factors. See “Risk Factors”.
The Partnerships make quarterly distributions of a portion of their Distributable Cash to their respective
Partners, including the Company. See “The Partnerships — Distribution Policy”. The amount of cash
available for dividends by the Company will be based on the amount of cash received by the Company
from the distributions by the Partnerships, after deducting the following from such amounts:

administrative expenses and other obligations of the Company;

income and other corporate taxes of the Company; and

any amount set aside as reserves by the Company.
The Company has historically paid a quarterly dividend on the Common Shares. The table below shows
the amount of dividends paid to Shareholders since the Company’s inception:
Dividend per share
$0.14042(1)
$0.24375
$0.24375
$0.24375
$0.24375
$0.24375
$0.24375
$0.24375
$0.24375
$0.24375
$0.24375
$0.24375
$0.24375
$0.24375
$0.24375
$0.24375
$0.24375
$0.24375
$0.24375
Declaration date
Record date
Payment date
January 12, 2011
April 12, 2011
July 12, 2011
October 11, 2011
January 10, 2012
April 10, 2012
July 10, 2012
October 9, 2012
January 8, 2013
April 10, 2013
August 7, 2013
December 11, 2013
February 4, 2014
May 14, 2014
August 15, 2014
December 10, 2014
February 11, 2015
May 8, 2015
August 6, 2015
January 24, 2011
April 25, 2011
July 25, 2011
October 24, 2011
January 24, 2012
April 24, 2012
July 24, 2012
October 23, 2012
January 22, 2013
April 22, 2013
August 19, 2013
December 20, 2013
February 14, 2014
May 27, 2014
August 26, 2014
December 22, 2014
February 20, 2015
May 22, 2015
August 21, 2015
January 28, 2011
April 29, 2011
July 29, 2011
October 28, 2011
January 27, 2012
April 27, 2012
July 27, 2012
October 26, 2012
January 25, 2013
April 26, 2013
August 22, 2013
December 27, 2013
February 19, 2014
May 30, 2014
August 29, 2014
December 29, 2014
February 27, 2015
May 29, 2015
August 28, 2015
Total distribution
(thousands)
$5,314
$9,230
$9,230
$9,230
$9,240
$9,240
$9,240
$9,240
$9,300
$9,252
$9,252
$9,252
$9,269
$9,269
$9,269
$9,268
$9,274
$9,274
$9,275
Note:
(1)
Represents a quarterly dividend of $0.24375 per common share pro-rated for the period from November 9, 2010 to
December 31, 2010.
DESCRIPTION OF CAPITAL STRUCTURE
The Company’s authorized share capital consists of an unlimited number of Common Shares and an
unlimited number of preferred shares. As at September 30, 2015, there were 38,052,008 Common Shares
and no preferred shares issued and outstanding.
Shareholders are entitled to one vote in respect of each Common Share held at all meetings of
Shareholders, other than meetings at which only the holders of another class or series of shares are
entitled to vote separately as a class or series. Shareholders are entitled to receive any dividend declared
by the Company in respect of the Common Shares, subject to the rights of the holders of other classes of
28
shares ranking in priority to the Common Shares. Shareholders will be entitled to receive, subject to the
rights of the holders of other classes of shares, the remaining property and assets of the Company
available for distribution, after payment of liabilities, upon the liquidation, dissolution or winding-up of
the Company, whether voluntary or involuntary.
The preferred shares of the Company are issuable in series with such dividend rates, redemption and
conversion features and other attributes as may be determined by the Board of Directors of the Company
and without further action by Shareholders. Preferred shares of all series have preference over Common
Shares and any other shares ranking junior to the preferred shares with respect to payment of dividends
and distribution of assets of the Company on liquidation, dissolution or winding-up.
THE PARTNERSHIPS
The Company owns, directly and indirectly, a 75% interest in the Partnerships, which own, directly and
indirectly, the Whistler Blackcomb Assets. The remaining 25% non-controlling interest in each of the
Partnerships is owned by Nippon Cable and its affiliates.
The Partnerships are limited partnerships formed under the laws of British Columbia.
The following is a summary of the material attributes and characteristics of the Partnership Agreements
that govern the Partnerships.
Capitalization
Each of the Partnerships may issue an unlimited number of Units. The Whistler Partnership Agreement
authorizes the General Partner to cause Whistler L.P. to issue additional Units for any consideration and
on any terms and conditions as are established by the General Partner. The Blackcomb Partnership
Agreement authorizes the General Partner to cause Blackcomb L.P. to issue additional Units for any
consideration and on any terms and conditions as are established by the General Partner. Whistler L.P.
has 1,737,000 Class A Units and 5,197,104 Class B Units outstanding and Blackcomb L.P., has 2,717,500
Class A Units and 8,130,760 Class B Units outstanding.
General Partner Interests
The general partner interests in Whistler L.P. are held by the Company, as General Partner, and Whistler
Blackcomb General Partner Ltd., as additional general partner. The general partner interests in
Blackcomb L.P. are held by the Company, as General Partner, and Whistler Blackcomb General Partner
Ltd., as additional general partner. In addition, a Company wholly-owned and controlled by Nippon
Cable (“Second Additional GP”) is an additional general partner of each of the Partnerships. Such
additional general partner does not have any power or authority to carry on the business of either of the
Partnerships except if, and for so long as, there is no other general partner which is competent to do so.
Each of Whistler Blackcomb General Partner Ltd. and the Second Additional GP are restricted from
carrying on any business other than in its capacity as a general partner of the Partnerships.
Units
The limited partnership interests in the Partnerships are represented by Units and are held by the
Company and Nippon Cable. Nippon Cable has been a limited partner of Blackcomb L.P. since 1992 and
Whistler L.P. since 1997. Nippon Cable manufactures and distributes cable lifts and its product lines
include aerial tramways, gondola lifts and chairlifts, as well as car parking facilities, transport machinery,
special purpose elevators, amusement park rides, ski resort equipment and facilities, and resort planning
29
and operations. Nippon Cable was founded in 1953, is based in Tokyo, Japan and also owns Sun Peaks
Resorts and Harvest Golf Club in British Columbia.
Class A Units
Each Class A Unit entitles the holder thereof:
(a)
to one vote for each Class A Unit held by such holder;
(b)
to allocations of net income, net loss, taxable income and tax loss and to the share of distributions
of cash in respect of each Class A Unit held by such holder as set forth in the Partnership
Agreements; and
(c)
to such preferences, priorities and rights over holders of Units of any other class (other than
Class B Units), if any, as the General Partner may determine in respect of an offering of Units of
such other class.
Nippon Cable and its affiliates hold all of the outstanding Class A Units of Whistler L.P. and all of the
outstanding Class A Units of Blackcomb L.P.
Class B Units
Each Class B Unit entitles the holder thereof:
(a)
to one vote for each Class B Unit held by such holder;
(b)
to allocations of net income, net loss, taxable income and tax loss and to the share of distributions
of cash in respect of each Class B Unit held by such holder as set forth in the Partnership
Agreements; and
(c)
to such preferences, priorities and rights over holders of Units of any other class (other than
Class A Units), if any, as the General Partner may determine in respect of an offering of Units of
such other class.
The Company holds all of the outstanding Class B Units of Whistler L.P. and all of the outstanding
Class B Units of Blackcomb L.P.
Distribution Policy
On a quarterly basis, the General Partner distributes the Distributable Cash of the Partnerships as follows:
(a)
to the General Partner, the General Partner’s share of Distributable Cash;
(b)
to the additional general partner owned by the Company, the additional general partner’s share of
Distributable Cash;
(c)
to the Second Additional GP, the Second Additional GP’s share of Distributable Cash; and
(d)
to the limited partners, the balance of Distributable Cash.
In respect of Whistler L.P. and Blackcomb L.P., the General Partner’s share and additional general
partner’s share of Distributable Cash is 0.9999% and 0.9999%, respectively, of such amount and the
30
Second Additional GP’s share of Distributable Cash is 0.00002% of such amount. Also, the Partnership
Agreements provide that for each fiscal period commencing March 31, 2013, Nippon Cable receive, at
minimum, distributions annually representing 9% of their contributions to the relevant Partnership during
the immediately preceding fiscal period plus amounts for income taxes payable.
For the purpose of determining the availability of Distributable Cash, cash funds will include credit
balances in bank accounts and funds invested in marketable securities or other readily liquid assets but
will not include amounts which may be drawn under financings.
The ability of the Partnerships to distribute Distributable Cash is subject to the terms of the New Credit
Facility. See “Credit Facilities of the Partnerships” and the Company’s Management’s Discussion and
Analysis of Financial Condition and Results of Operations for Fiscal 2015 available on SEDAR at
www.sedar.com.
Allocation of Net Income and Losses
Approximately 75% of net income or net loss in respect of any fiscal period is allocated to the Company
on account of the Company’s general partner and limited partner interests and approximately 25% of net
income or net loss is allocated to Nippon Cable and its affiliates on account of Nippon Cable and its
affiliates’ limited partner interests. Income or loss for purposes of the Tax Act is allocated to Partners
having regard to, among other things, the deductions in each Partnership that are attributable to assets
having been contributed to that Partnership by the Company in connection with the transactions described
under “General Development of the Business  History”. As a result, a Partner who made such a
contribution is allocated less income for purposes of the Tax Act so that it will benefit from the
deductions arising from such contribution.
Functions and Powers of General Partner
The General Partner is authorized to carry on the business of the Partnerships. The General Partner has
full power and authority to administer, manage, control and operate the business and affairs of the
Partnerships, including the following:
(a)
to incur, assume or become liable in respect of any financing from time to time, and without limit
as to the amount, cost or terms of payment thereof upon the credit of the Partnerships and to incur
and to assume and covenant to pay indebtedness, liabilities and obligations of any kind, to
guarantee obligations of, co-covenant with and join in the covenants of, others, whether in respect
of the indebtedness, liabilities or obligations of the Partnerships or of others, and to raise or
secure the repayment thereof, in such manner, on such terms and conditions, and in all respects as
the General Partner thinks fit;
(b)
to provide guarantees and indemnities to third parties in respect of the indebtedness, liabilities or
obligations of the Partnerships or of any other person in the ordinary course of the business of the
Partnerships;
(c)
to incur and pay all costs, outlays, disbursements and expenditures of the Partnerships;
(d)
to engage managers, lawyers, accountants, financial advisers and other such consultants and
professionals as the General Partner may deem necessary or advisable;
(e)
to open, maintain and close bank accounts on behalf of the Partnerships and to invest funds of the
Partnerships not immediately required for the business of the Partnerships;
31
(f)
to commence or defend any legal proceeding in connection with the Partnerships or Whistler
Blackcomb, or the property or assets of the Partnerships, and take all action in connection
therewith, including consenting to a judgment against the Partnerships or agreeing to any
compromise or arrangement with creditors of the Partnerships;
(g)
to file returns required by any governmental authority and make remittances and payments in
connection therewith;
(h)
to make any election, designation or determination that may be made under the Tax Act or any
other fiscal legislation;
(i)
to sell, exchange or trade the property, assets and undertakings of the Partnerships (including
Whistler Blackcomb) as an entirety or any part thereof;
(j)
to lease or licence all or any part of the property, assets or undertaking of the Partnerships, in such
manner and on such terms as the General Partner considers appropriate;
(k)
to enter into any agreement for the management or operation of the business, property or other
assets of the Partnerships;
(1)
to acquire and maintain insurance coverage that the General Partner deems necessary or advisable
for the protection of the Partnerships against claims, liabilities and losses arising;
(m)
to employ, supervise, manage and terminate all employees in the conduct of the business of the
Partnerships;
(n)
to execute all agreements related to the management of the business of the Partnerships; and
(o)
to do all other acts or things necessary for the furtherance of the business of the Partnerships.
The General Partner must exercise its powers honestly, in good faith and with a view to the best interests
of the Partnerships.
Limited Liability
Subject to applicable legislation, the liability of limited partners of the Partnerships, who are not
otherwise the General Partner or the additional general partner, for indebtedness, liabilities and
obligations of the Partnerships is limited to the amount contributed to the Partnerships in respect of the
Units held by the limited partner. Limited partners are not liable for any further claims or contributions to
the Partnerships. The General Partner will indemnify a limited partner for costs, damages, liabilities or
expenses suffered or incurred by the limited partner because the liability of the limited partner is not so
limited as a result of, or arising out of, any act or omission of the General Partner.
The General Partner and additional general partners of the Partnerships have unlimited liability for the
indebtedness, liabilities and obligations of the Partnerships.
Issuance of Additional Partnership Units
Pursuant to the terms of the Partnership Agreements, the General Partner may not offer for sale, by a
public or private offering, or issue to any person, additional Units of either of the Partnerships unless the
General Partner first offers a certain amount of such additional Units (as calculated pursuant to the terms
of the applicable Partnership Agreement) to the limited partners of the applicable Partnership. In such
32
case, each limited partner of the applicable Partnership has the right to subscribe for all or any of such
additional Units subject to and on the terms and conditions of the applicable Partnership Agreement.
Transfer of Partnership Interests
The Units may not be assigned and no assignee will be admitted to either Partnership as a limited partner
except with the written consent of the General Partner. A Unit is assignable, however, to the General
Partner. If an assignee is accepted as a limited partner, the General Partner is authorized to admit the
assignee as a limited partner and pursuant to the Partnership Agreements the limited partners
automatically consent to the admission of the new limited partner.
Subject to and on the terms and conditions of the Partnership Agreements, the General Partner or Whistler
Blackcomb General Partner Ltd. may, in certain circumstances, sell all but not less than all of their
general partner interests in either Partnership to a bona fide arm’s length person.
The General Partner may also sell all or any part of the issued and outstanding Units in the applicable
Partnership to a bona fide arm’s length third party provided an equivalent offer is made for the Units of
the other limited partners. In the case of a sale of the general partner interests or a sale of Units resulting
in the General Partner holding less than 50% of the Units, and in certain other circumstances prescribed in
the Partnership Agreements, the limited partners have a right of dissent, pursuant to which, the limited
partners have the right to have their Units purchased by the General Partner for an amount equal to the
fair market value of the Units.
Retirement of General Partner
The General Partner may retire if it assigns all of its general partner interests in the Partnerships to an
affiliate or if the assignment is the result of an amalgamation of the General Partner with an affiliate. The
General Partner does not require the consent of the limited partners to resign in such circumstances.
Alternatively, the General Partner may retire with the consent of the limited partners by extraordinary
resolution. The limited partners do not base the right to require the General Partner to retire.
Amendment
The General Partner may amend the Partnership Agreements in order to give effect to an extraordinary
resolution, if additional Units are offered, or if there is a change of partners. However, the Partnership
Agreements cannot otherwise be amended unless the amendment is by instrument in writing executed by
all Partners.
Meetings
The General Partner will call an annual general meeting and may, at its discretion, call additional
meetings of the Partners of each Partnership. If the General Partner receives a requisition for a meeting
signed by limited partners holding in the aggregate more than 10% of the Units of a Partnership, then the
General Partner must call a meeting to be held within 21 days. Meetings will be held in either
Vancouver, British Columbia or the Resort Municipality of Whistler. Quorum consists of at least one
person present who owns or represents more than 50% of all issued and outstanding Units entitled to vote.
Limited partners have one vote for each Unit held and the General Partner is entitled to vote on any Units
it holds.
33
With respect to Board meetings of the General Partner, Nippon Cable has the right to appoint a nonvoting observer to attend all Board meetings.
CREDIT FACILITIES OF THE PARTNERSHIPS
The Partnerships entered into an amended and restated $300 million five-year senior secured revolving
credit facility which matures on November 12, 2018 with a syndicate of nine Canadian and US banks on
November 12, 2013 (as amended and restated, the “New Credit Facility”). The New Credit Facility is
fully committed and includes additional availability, subject to certain requirements, of up to $75 million.
Interest is payable at a floating rate based by way of the issue of bankers’ acceptances or prime rate
borrowings, at the Partnerships’ election, plus an applicable margin of, in the case of bankers’
acceptances, 1.75% to 3.00% per annum and, in the case of prime rate borrowings, an applicable margin
that is 1.00% less than the margin applicable to bankers’ acceptances, in each case depending on the
Partnerships’ total leverage ratio. Notwithstanding the foregoing, the applicable margin was 2.50% from
November 12, 2013 until approximately May 15, 2014, in accordance with the terms of the New Credit
Facility.
The New Credit Facility is subject to customary representations, warranties, covenants, events of default
and other terms and conditions for a facility of this nature, including but not limited to limitations on
liens, acquisitions, sales of assets, affiliate transactions, investments, indebtedness, mergers,
consolidations, liquidations and dissolutions, sale leasebacks and distributions. The New Credit Facility is
guaranteed by the Company, certain subsidiaries of the Company and all of the Partnerships’ direct and
indirect subsidiaries (collectively, the “Subsidiary Guarantors”), and is secured by first ranking security
interests over substantially all of the tangible and intangible assets of the Partnerships and the Subsidiary
Guarantors. This security includes material real property, an assignment by way of security of material
agreements, a pledge of the Company’s interests in the Partnerships and in the Subsidiary Guarantors that
are subsidiaries of the Company, and a pledge by the Partnerships of their interests in the other Subsidiary
Guarantors.
The New Credit Facility includes the following applicable financial covenants: maximum consolidated
total leverage ratio (as defined in the New Credit Facility agreement) not to exceed 4:1 and minimum
consolidated interest coverage ratio (as defined in the New Credit Facility agreement) of not less than
2.00:1.
The New Credit Facility replaced the Partnerships’ existing Old Credit Facilities and refinancing proceeds
of $261 million were used to repay all amounts due under the Old Credit Facilities. The Partnerships
incurred a call premium of approximately $5.5 million in connection with the prepayment of the Second
Lien Notes, which was funded from the Partnerships’ cash on hand, and was recorded in finance expense
in the Company’s 2014 first quarter consolidated financial statements.
As of the date of this Annual Information Form, no funds remain payable by the Company pursuant to the
Old Credit Facilities. Subsequent to September 30, 2014, the Partnerships agreed with the syndicate of
banks to extend the term of the New Credit Facility by one year to November 12, 2019.
34
MARKET FOR SECURITIES
The Common Shares are listed on the Toronto Stock Exchange under the symbol “WB”. The following
table sets out the market price ranges and trading volumes on a monthly basis for the period from
October 1, 2014 to September 30, 2015:
Month
October 2014
November 2014
December 2014
January 2015
February 2015
March 2015
April 2015
May 2015
June 2015
July 2015
August 2015
September 2015
High
$19.19
$20.00
$20.77
$21.07
$19.98
$20.46
$18.90
$19.89
$20.25
$20.85
$22.50
$22.38
Low
$17.55
$18.89
$19.42
$19.11
$18.26
$17.92
$17.67
$17.90
$19.17
$19.01
$20.40
$21.42
Volume
773,291
919,914
852,759
2,618,920
1,651,807
990,808
1,645,768
1,721,997
769,315
1,424,765
1,056,878
1,565,509
DIRECTORS AND EXECUTIVE OFFICERS
The following tables set out, for each of the directors and executive officers of the Company as at
September 30, 2015, the person’s name, province or state and country of residence, positions with the
Company and principal occupation during the five preceding years. All directors and executive officers
of the Company were appointed to their offices on October 6, 2010, unless otherwise noted. Unless
otherwise indicated, directors are expected to hold office until the next annual meeting of shareholders.
Directors are elected annually and, unless re-elected, retire from office at the end of the next annual
general meeting of Shareholders. As at September 30, 2015, the directors and executive officers of the
Company, as a group, owned or exercised control of or direction over directly or indirectly, less than 1%
of the outstanding Common Shares.
Directors
Name and Province or State and
Country of Residence
Positions(s)/Title
Principal Occupation For Past Five Years
Dave Brownlie
British Columbia, Canada
President and Chief
Executive Officer and
Director(4)
President and Chief Executive Officer of the Company.
Previously, President and Chief Operating Officer of the
Company.
John Furlong(1)(2)
British Columbia, Canada
Director
Corporate director. Previously, Chief Executive Officer,
Vancouver Organizing Committee for the 2010 Olympic and
Paralympic Winter Games until 2011.
Russell Goodman(1)(3)
Québec, Canada
Director
Corporate director. Previously, Partner,
PricewaterhouseCoopers LLP until his retirement on June
30, 2011.
Scott Hutcheson(1)(3)
Alberta, Canada
Director
Founding Partner and Executive Chairman, Aspen
Properties Ltd.
Peter McDermott(3)
Colorado, United
States of America
Director(5)
Partner, KSL Capital Partners, LLC
Eric Resnick(1)(2)
Colorado, United States of America
Director(6)
Chief Executive Officer, KSL Capital Partners, LLC
Michele Romanow(1)(2)
Ontario, Canada
Director(7)
Entrepreneur and senior marketing executive with Snap by
Groupon. Previously, co-founder SnapSaves (2013-2014),
Director, Strategy and Business Improvement, Sears Canada
(2009-2011).
35
Directors
Name and Province or State and
Country of Residence
Graham Savage(2)(3)
Ontario, Canada
Positions(s)/Title
Principal Occupation For Past Five Years
Chairman
Corporate Director. Previously, Chairman and Founding
Partner, Callisto Capital (merchant banking) until 2008.
Notes:
(1)
Member of the Compensation Committee as at September 30, 2015.
(2)
Member of the Corporate Governance & Nominating Committee as at September 30, 2015.
(3)
Member of the Audit Committee as at September 30, 2015.
(4)
Mr. Brownlie was appointed as President and Chief Executive Officer and a Director of the Company effective December 4, 2012.
(5)
Mr. McDermott was appointed a director of the Company effective December 4, 2012.
(6)
Mr. Resnick was appointed a director of the Company effective December 4, 2012.
(7)
Ms. Romanow was appointed a director of the Company effective June 23, 2015.
Executive Officers
Name and Province or State and
Country of Residence
Positions(s)/Title
Principal Occupation For Past Five Years
Jeremy Black
British Columbia, Canada
Senior Vice President &
Chief Financial Officer(1)
Chief Financial Officer of the Company; previously, Vice
President, Business Development & Corporate Secretary of
Ritchie Bros Auctioneers Incorporated (2002-2012)
Dave Brownlie
British Columbia, Canada
President and Chief
Executive Officer and
Director(2)
President and Chief Executive Officer of the Company;
previously, President and Chief Operating Officer of the
Company
Joel Chevalier
British Columbia, Canada
Vice President, Employee
Experience
Vice President, Employee Experience; previously, Director
Employee Experience of the Company (2007-2014)
Robert Dufour
British Columbia, Canada
Vice President, Mountain
Operations &
Maintenance
Vice President, Mountain Operations of the Company
Flora Ferraro
British Columbia, Canada
Vice President, Finance
Vice President, Finance of the Company
Todd Friesen
British Columbia, Canada
Vice President, Retail &
Rental
Vice President, Retail & Rental of the Company
Thierry Keable
British Columbia, Canada
General Counsel and
Corporate Secretary(3)
General Counsel and Corporate Secretary. Previously,
business lawyer, Farris, Vaughan, Wills & Murphy LLP and
Osler, Hoskin & Harcourt LLP (2004-2014)
Rob McSkimming
British Columbia, Canada
Vice President, Business
Development
Vice President, Business Development of the Company
Stuart Rempel
British Columbia, Canada
Senior Vice President,
Marketing and Sales
Senior Vice President, Marketing and Sales of the Company
Marc Sedgwick
British Columbia, Canada
Vice President,
Information Technology
Vice President, Information Technology of the Company
Paul Street
British Columbia, Canada
Vice President, Food &
Beverage
Vice President, Food & Beverage of the Company;
previously, Director Food and Beverage of the Company
(2006-2014)
Notes:
(1)
Mr. Black was appointed Chief Financial Officer of the Company effective January 15, 2013.
(2)
Mr. Brownlie was appointed as President and Chief Executive Officer and a Director of the Company effective December 4, 2012.
(3)
Mr. Keable was appointed as General Counsel and Corporate Secretary of the Company effective February 9, 2014.
Conflicts of Interest
To the best of the knowledge of management of the Company, there are no known existing or potential
conflicts of interest among the Company and its directors, officers or other members of management as a
result of their outside business interests except that certain of the Company’s directors and officers serve
as directors and officers of other companies, and therefore it is possible that a conflict may arise between
their duties to the Company and their duties as a director or officer of such other companies. See “Interest
of Management and Others in Material Transactions”.
36
Eric Resnick and Peter McDermott, directors of the Company appointed to such capacity effective
December 4, 2012, are an officer and a member, respectively, of KSL Capital Partners III GP, LLC. As
KSL Capital Partners III GP, LLC exercises control or direction over KSL Capital Partners III GP, LLC,
such individuals may from time to time be in a conflict of interest related to their respective duties as
directors of the Company. In the event of such a conflict, the Board and Messrs. Resnick and McDermott
will comply with the conflict of interest provisions of the Business Corporations Act (British Columbia),
which may require Messrs. Resnick and McDermott to withhold from voting on certain matters. See
“Risk Factors—Risks Related to Third Party Interests — Investment by KSL Capital Partners III GP,
LLC”.
Indemnification
The Company has entered into indemnification agreements with each of its directors and officers and the
officers of its subsidiaries. The indemnification agreements generally require that the Company
indemnify and hold the indemnitees harmless to the greatest extent permitted by law for liabilities arising
out of the indemnitees’ service to the Company or its subsidiaries as directors and officers, provided that
the indemnitees acted honestly and in good faith and in a manner the indemnitees reasonably believed to
be in or not opposed to the Company’s best interests and, with respect to criminal and administrative
actions or proceedings that are enforced by monetary penalty, the indemnitees had no reasonable grounds
to believe that his or her conduct was unlawful. The indemnification agreements also provide for the
advancement of defence expenses to the indemnitees by the Company.
Cease Trade Orders, Bankruptcies, Penalties or Sanctions
To the best of the knowledge of management of the Company and except as set out below, no director or
executive officer or any Shareholder holding a sufficient number of Common Shares to materially affect
the control of the Company:
(a)
(b)
is, as at the date of this Annual Information Form, or has been, within the ten years
before, a director or executive officer of any company (including the Company), that
while that person was acting in that capacity,
(i)
was the subject of a cease trade or similar order or an order that denied the
relevant company access to any exemption under securities legislation, for a
period of more than 30 consecutive days,
(ii)
was subject to an event that resulted, after the director or executive officer
ceased to be a director or executive officer, in the company being the subject of a
cease trade or similar order or an order that denied the relevant company access
to any exemption under securities legislation, for a period of more than 30
consecutive days, or
(iii)
or within a year of that person ceasing to act in that capacity, became bankrupt,
made a proposal under any legislation relating to bankruptcy or insolvency or
was subject to or instituted any proceedings, arrangement or compromise with
creditors or had a receiver, receiver manager or trustee appointed to hold its
assets, or
has, within the 10 years before the date of this Annual Information Form, become
bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or
become subject to or instituted any proceedings, arrangement or compromise with
37
creditors, or had a receiver, receiver manager or trustee appointed to hold the assets of the
director or executive officer or shareholder.
Graham Savage was a director of Microcell Inc. when it filed for protection under the Companies’
Creditors Arrangement Act (Canada). From July 2003 until November 30, 2009, Mr. Savage was a
director of Sun-Times Media Group, Inc., a successor entity of Hollinger International Inc. (“Hollinger”).
On June 1, 2004, the Ontario Securities Commission issued a permanent management cease trade order
(the “Ontario Cease Trade Order”) against the insiders of Hollinger for failing to file its interim financial
statements and interim management’s discussion and analysis for the three-month period ended March 31,
2004 and its annual financial statements, management’s discussion and analysis, and annual information
form for the year ended December 31, 2003. In addition, the British Columbia Securities Commission
issued a cease trade order against insiders of Hollinger resident in British Columbia on May 21, 2004, as
updated on May 31, 2004 (the “BC Cease Trade Order”). The Ontario Cease Trade Order was allowed to
expire on January 9, 2006 and is no longer in effect. The BC Cease Trade Order was revoked on
February 10, 2006 and is no longer in effect.
To the best of the knowledge of management of the Company, none of its directors or executive officers
or any Shareholder holding a sufficient number of the Common Shares to materially affect the control of
the Company have been subject to:
(a)
any penalties or sanctions imposed by a court relating to securities legislation or by a
securities regulatory authority or has entered into a settlement agreement with a securities
regulatory authority, or
(b)
any other penalties or sanctions imposed by a court or regulatory body that would likely
be considered important to a reasonable investor in making an investment decision.
AUDIT COMMITTEE INFORMATION
The audit committee of the Company (the “Audit Committee”) is composed of a minimum of three
directors, each of whom must at all times be financially literate within the meaning of NI 52-110. The
Audit Committee is presently composed of Russell Goodman, Peter McDermott, Scott Hutcheson and
Graham Savage, each of whom is independent and financially literate. Mr. Goodman acts as chair of the
Audit Committee. Each of the Audit Committee members has an understanding of the accounting
principles used to prepare financial statements and varied experience as to the general application of such
accounting principles, as well as an understanding of the internal controls and procedures necessary for
financial reporting. See below for a brief summary of the education and experience of each Audit
Committee member that is relevant to his performance as a member of the Audit Committee.
Audit Committee Member
Relevant Experience
Russell Goodman
Mr. Goodman is a Chartered Accountant and was a partner at the
accounting firm PricewaterhouseCoopers LLP until his retirement on
June 30, 2011.
Scott Hutcheson
Mr. Hutcheson is Executive Chairman of a real estate firm that
manages approximately one billion dollars in assets and previously
was an investment banker with Goldman & Sachs.
Graham Savage
Mr. Savage has a degree in Business Administration, seven years
experience as the Chief Financial Officer of Rogers Communications
Inc., has chaired the audit committees of a number of other public
companies and was the founding partner of a merchant banking firm.
Peter McDermott
Mr. McDermott holds a B.A. in Economics from Harvard College and
38
Audit Committee Member
Relevant Experience
an M.B.A. from the Stanford Graduate School of Business. He has 15
years of experience in banking and investing and is currently a Partner
of KSL Capital Partners, LLC.
The Board of Directors has adopted a written charter for the Audit Committee (the “Charter of the Audit
Committee”), which sets out the Audit Committee’s responsibility in reviewing the financial statements
of the Company and public disclosure documents containing financial information and reporting on such
review to the Board of Directors, ensuring that adequate procedures are in place for the review of the
Company’s public disclosure documents that contain financial information, overseeing the work and
review the independence of the external auditors and reviewing, evaluating and approving the internal
control procedures that are implemented and maintained by management. A copy of the Charter of the
Audit Committee is attached to this Annual Information Form as Appendix A.
Pre-Approval Policies and Procedures
The Audit Committee reviews and pre-approves the planned non-audit services and the related fees
provided by the external auditor. Any changes in such services and related fees are reviewed and
approved by the Chair of the Audit Committee, who will present the item at the first scheduled meeting
following such change.
Audit and Non-Audit Fees Billed by Auditor
The auditors of the Company and the Partnerships are KPMG LLP, located at 900-777 Dunsmuir Street,
P.O. Box 10426 Pacific Centre, Vancouver, British Columbia, V7Y 1K3. KPMG’s fees relating to Fiscal
2015 and Fiscal 2014 are set out below:
(1)
Audit Fees
Audit Related Fees
Tax Fees(3)
All Other Fees
Total Fees
(4)
(2)
Fiscal 2015
Fiscal 2014
$282,951
$305,221
$55,375
13,750
$49,594
48,740
$21,400
–
$409,320
$367,711
Notes:
(1) “Audit fees” consist of fees charged by the auditor in connection with the audit and review of the Company’s annual and interim financial
statements and management’s discussion and analysis.
(2) “Audit Related Fees” consist of fees charged by the auditor in relation to performing the audit of, or reviewing financial statements, that were
not part of the audit fees.
(3) “Tax Fees” consist of fees charged by the auditor for tax compliance or advice.
(4) “All Other Fees” consist of fees charged by the auditor in connection with the testing of the Company’s adoption of SAP.
LEGAL PROCEEDINGS AND REGULATORY ACTIONS
Neither the Company, the Partnerships nor Whistler Blackcomb is involved in any litigation proceedings
or regulatory actions that would have a material adverse effect on their financial condition or results of
operations or cash flows or resulted in penalties or sanctions being imposed against the Company or the
Partnerships or settlement agreements being entered into by the Company or the Partnerships before a
court or with any regulatory authority.
The Company, the Partnerships and their respective subsidiaries are involved in, and the Company, the
Partnerships and their respective subsidiaries may from time to time in the future be involved in, litigation
39
in the ordinary course of business, including lawsuits with respect to personal injury claims related
principally to heli-skiing and skiing, snowboarding and mountain biking activities on Whistler Mountain
and Blackcomb Mountain. The Company, the Partnerships and their respective subsidiaries maintain
liability insurance that they consider adequate to insure claims related to usual and customary risks
associated with the operation of a four season mountain resort.
INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS
No director, executive officer or holder of more than 10% of the outstanding Common Shares or any
associate or affiliate of the foregoing has, or has had, any material interest in any transaction prior to the
date hereof or any proposed transaction that has materially affected or will materially affect the Company
or any of its affiliates, except as disclosed elsewhere in this Annual Information Form.
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for the Common Shares is Computershare Investor Services Inc. at its
principal offices in Vancouver and Toronto.
MATERIAL CONTRACTS
The following are the only material contracts, other than those contracts entered into in the ordinary
course of business, which the Company has entered into since the beginning of the last financial year
before the date of this Annual Information Form or entered into prior to such date but which contract is
still in effect:

the Whistler Development Agreement referred to under “Business of the Company 
Whistler and Blackcomb Development Agreements”;

the Blackcomb Development Agreement referred to under “Business of the Company 
Whistler and Blackcomb Development Agreements”;

the Whistler Partnership Agreement referred to under “The Partnerships”;

the Blackcomb Partnership Agreement referred to under “The Partnerships”;

the New Credit Facility referred to under “Credit Facilities of the Partnerships”; and

the Registration Rights Agreement. In connection with the Acquisition, the Company
and Intrawest entered into the Registration Rights Agreement. Effective December 4,
2012, Intrawest assigned its rights and obligations under the Registration Rights
Agreement to Monroe CA BC Investment, LP. The Registration Rights Agreement
obligates the Company to file a prospectus in Canada to assist Monroe CA BC
Investment, LP with the distribution of its common shares of the Company at Monroe CA
BC Investment, LP’s demand.
Copies of the above material agreements may be inspected during ordinary office business hours at the
Company’s principal executive offices located at 4545 Blackcomb Way, Whistler, British Columbia or
are available on SEDAR at www.sedar.com.
40
INTERESTS OF EXPERTS
KPMG LLP has audited the consolidated financial statements of the Company for Fiscal 2015 and the
combined and consolidated financial statements of the Partnerships for Fiscal 2015 and has confirmed
that they are independent with respect to the Company within the meaning of the Rules of Professional
Conduct of the Institute of Chartered Accountants of British Columbia.
ADDITIONAL INFORMATION
Additional information relating to the Company is available on SEDAR at www.sedar.com. Additional
financial information is provided in the Company’s consolidated financial statements for Fiscal 2015 and
the related Management’s Discussion and Analysis of Financial Condition and Results of Operations
available on SEDAR at www.sedar.com.
Additional information, including directors’ and officers’ remuneration and indebtedness, principal
holders of Common Shares and securities authorized for issuance under equity compensation plans is
contained in the Company’s information circular for its most recent annual meeting of shareholders
involving the election of directors.
41
GLOSSARY OF TERMS
“Acquisition” means the transactions completed in connection with the IPO as described under the
heading “General Development of the Business – History”.
“Adjusted EBITDA” means, unless otherwise noted or the context otherwise indicates, net income,
including any non-controlling interest’s share of net income adjusted for finance income, net,
provision/(recovery) for income taxes and depreciation and amortization.
“Audit Committee” has the meaning set out under the heading “Audit Committee Information”.
“bed unit” means a unit of development that reflects the servicing and facility requirements for one
person.
“Blackcomb Assets” means, as the context requires, the assets owned, directly or indirectly, by
Blackcomb L.P. in connection with Whistler Blackcomb immediately prior to, or immediately following,
the completion of the IPO.
“Blackcomb Development Agreement” means the legacy development agreement dated May 1, 1979, as
amended, among Blackcomb L.P., the Company and the Province in respect of Blackcomb Mountain.
“Blackcomb L.P.” means, at the relevant time, Blackcomb Skiing Enterprises Limited Partnership and its
subsidiaries, as the context requires.
“Blackcomb Mountain” means Blackcomb Mountain located in the Resort Municipality of Whistler.
“Blackcomb Partnership Agreement” means the amended and restated agreement of limited
partnership among the Company, as General Partner, Whistler Blackcomb General Partner Ltd., as
additional general partner, Second Additional GP, as additional general partner, and the Company and
Nippon Cable, as limited partners, dated November 12, 2010 in respect of Blackcomb L.P.
“Board of Directors” means the board of directors of the Company.
“Class A Units” means the Class A units of Whistler L.P. or Blackcomb L.P., as the context requires, as
described under “The Partnerships — Class A Units”.
“Class B Units” means the Class B units of Whistler L.P. or Blackcomb L.P., as the context requires, as
described under “The Partnerships — Class B Units”.
“Code” means the Company’s code of business conduct and ethics governing the conduct of directors,
officers, management and employees of the Company and its subsidiaries.
“Common Shares” means Common Shares in the capital of the Company.
“Compensation Committee” has the meaning set out under the heading “Corporate Governance —
Board of Directors — Compensation Committee”.
“Crown Land” means land that is owned by the Province.
“Development Agreements” means, together, the Whistler Development Agreement and the Blackcomb
Development Agreement.
42
“Distributable Cash” means the amount, if any, that the General Partner determines to be the amount by
which the cash funds of each Partnership from any source exceeds the aggregate, without duplication, of:
(a) all amounts which are due and payable by the Partnership in respect of any financing; (b) all amounts
payable and accrued liabilities of the Partnership which have been incurred and are payable within six
months; and (c) the amount set aside as reserves.
“Effective Ticket Price” or “ETP” means the lift ticket yield per skier visit and is calculated as total skirelated lift revenue divided by total skier visits. Ski-related lift revenue and skier visits exclude revenue
and visits from summer glacier skiing and other revenue amounts.
“Fiscal 2013” means the Company’s fiscal year beginning on October 1, 2012 and ending on September
30, 2013.
“Fiscal 2014” means the Company’s fiscal year beginning on October 1, 2013 and ending on September
30, 2014.
“Fiscal 2015” means the Company’s fiscal year beginning on October 1, 2014 and ending on September
30, 2015.
“General Partner” means the general partner of each of Whistler L.P. and Blackcomb L.P., respectively,
as the context may require, with power and authority to control and operate their business, which is
currently the Company.
“Intrawest” means Intrawest ULC, an unlimited liability Company amalgamated under the laws of the
Province of Alberta, Canada.
“IPO” means the initial public offering of Common Shares completed on November 9, 2010.
“Named Executive Officers” means the Company’s Chief Executive Officer and Chief Financial
Officer, or persons performing those functions for the Company at any time during Fiscal 2015, and the
three next most highly compensated executive officers of the Company who are currently serving as
executive officers.
“New Credit Facilities” has the meaning set out under the heading “Credit Facilities of the Partnerships”.
“NI 52-110” has the meaning set out under the heading “Corporate Governance — Board of Directors”.
“Nippon Cable” means Nippon Cable Co., Ltd. and its affiliates.
“Old Credit Facilities” means the credit facilities of the Partnerships that were repaid in their entirety in
November 2014, consisting of first lien facilities with a group of financial institutions and a second lien
senior secured facility with a Canadian institutional investor.
“Olympic Winter Games” means the 2010 Olympic and Paralympic Winter Games.
“Partners” means the General Partner, additional general partners and limited partners of Whistler L.P.,
Blackcomb L.P. or both Whistler L.P. and Blackcomb L.P., as the context requires.
“Partnership Agreements” means, together, the Whistler Partnership Agreement and the Blackcomb
Partnership Agreement.
“Partnerships” means, together, Whistler L.P. and Blackcomb L.P.
43
“PPH” means people per hour.
“Province” means the Province of British Columbia.
“Registration Rights Agreement” means the registration rights agreement between the Company and
Intrawest dated November 9, 2010, as assigned to Monroe CA BC Investment, LP effective December 4,
2012.
“Resort Municipality of Whistler” or “RMOW” means the Resort Municipality of Whistler and
surrounding areas, including the Callaghan Valley.
“Second Additional GP” has the meaning set out under the heading “The Partnerships – General Partner
Interests”.
“Second Lien Notes” means the second lien senior secured notes issued by the Partnerships at the time of
the IPO and forming part of the Old Credit Facilities.
“Shareholder” means a holder of Common Shares.
“Tax Act” means the Income Tax Act (Canada) and the regulations thereunder.
“Units” means the limited partnership units of Blackcomb L.P. or Whistler L.P., or both, as the context
may require, described under the heading “Partnerships”.
“U.S.” or “United States” means United States of America, its territories and possessions, any state of
the United States and the District of Columbia.
“VANOC” means the Vancouver Organizing Committee for the Olympic Winter Games.
“Whistler Assets” means, as the context requires, the assets owned, directly or indirectly, by Whistler
L.P. in connection with Whistler Blackcomb immediately prior to, or immediately following, the
completion of the IPO.
“Whistler Blackcomb” refers to, as the context requires, either: (i) the four season mountain resort
business and operations historically carried on by the Partnerships at the Resort Municipality of Whistler
and the assets owned by the Partnerships and Intrawest in connection therewith; or (ii) the four season
mountain resort business and operations currently carried on by the Partnerships at the Resort
Municipality of Whistler and the assets owned by the Partnerships and the Company in connection
therewith.
“Whistler Blackcomb Assets” means, together, the Whistler Assets and the Blackcomb Assets.
“Whistler Development Agreement” means the legacy development agreement dated September 30,
1982, as amended, among Whistler L.P., the Company and the Province in respect of Whistler Mountain.
“Whistler L.P.” means, at the relevant time, Whistler Mountain Resort Limited Partnership and its
subsidiaries, as the context requires.
“Whistler Mountain” means Whistler Mountain located in the Resort Municipality of Whistler.
“Whistler Partnership Agreement” means the amended and restated agreement of limited partnership
among the Company, as General Partner, Whistler Blackcomb General Partner Ltd., as additional general
44
partner, Second Additional GP, as additional general partner, and the Company, an affiliate of Nippon
Cable Co., Ltd. and two companies related to Nippon Cable Co., Ltd., as limited partners, dated
November 12, 2010, in respect of Whistler L.P.
“Whistler Village” means the pedestrian villages located at the bases of Whistler Mountain and
Blackcomb Mountain.
45
APPENDIX A
AUDIT COMMITTEE CHARTER
I.
PURPOSE
The Audit Committee (the “Committee”) is appointed by the Board of Directors (the “Board”) of
Whistler Blackcomb Holdings Inc. (the “Company”) to assist the Board in fulfilling its oversight
responsibilities. The Committee will:
•
Review the financial statements, management’s discussion and analysis, annual and
interim earnings press releases and other financial information provided by the Company
to its shareholders and filed with securities commissions;
•
Review the annual financial plan, including all modifications thereto, and details of any
proposed financing;
•
Monitor the integrity of the financial reporting and disclosure processes and the system of
internal controls that management and the Board have established, including the plan and
framework for compliance with regulatory requirements for officer certification of annual
and interim filings;
•
Monitor management of the principal risks that could impact the financial reporting of
the Company;
•
Review and approve the audit plan, process, results and performance of the Company’s
independent external auditor (the “External Auditor”) while providing an open avenue of
communication between the External Auditor, management and the Board; and
•
Establish procedures for complaints received by the Company regarding accounting,
internal accounting controls or auditing matters, and the confidential, anonymous
submission by employees of the Company of concerns regarding questionable accounting
or auditing matters.
The Committee has the authority to conduct any investigation appropriate to fulfilling its
responsibilities, and shall have direct access to the External Auditor and anyone in the Company
to fulfill its responsibilities. The Committee has the authority to retain, at the Company’s
expense, special legal, accounting and other consultants or experts it deems necessary in the
performance of its duties.
II.
AUDIT COMMITTEE COMPOSITION AND MEETINGS
The Committee shall consist of three or more independent directors, as determined by the Board,
each of whom are unrelated directors, free from any direct or indirect relationship with the
Company that would interfere with the exercise of his or her independent judgment. The
Committee shall be appointed by the Board at the first meeting of the Board following the Annual
General Meeting and hold office until the next Annual General Meeting. All Committee
members shall be financially literate with a working familiarity of basic finance and accounting
practices, and at least one Committee member shall be a financial expert having accounting or
related financial management expertise.
A-1
A chair of the Committee (the “Chair”) shall be elected or appointed annually by the Board from
among the members of the Committee. Any Committee member may be removed or replaced at
any time by the Board. Committee members shall cease to be a member upon ceasing to be a
director of the Company. Each member shall hold office until the earlier of the close of the next
annual meeting of shareholders of the Company or until the member resigns or is replaced.
The Committee shall meet at least quarterly, or more frequently as deemed necessary by the
Chair. The Chair shall prepare and/or approve an agenda in advance of each meeting. The
Committee shall meet privately at least quarterly with management and the External Auditor to
discuss any matters that the Committee or either of those groups believes should be discussed.
A quorum of a meeting of the Committee shall consist of a simple majority of the members of the
Committee.
The External Auditor shall be given notice of, and have the right to appear before and to be heard
at, every meeting of the Committee, and shall appear before the Committee when requested to do
so by the Committee.
If all members consent, and proper notice has been given or waived, a member or members of the
Committee may participate in a Committee meeting by means of such telephonic, electronic or
other communication facilities as will permit all persons participating in the meeting to
communicate adequately with each other, and a member participating in such a meeting by such
means is deemed to be present at that meeting.
III.
PRIMARY DUTIES AND RESPONSIBILITIES
To fulfill its primary duties and responsibilities, the Committee shall adhere to the following
terms:
(a)
Review and Reporting Procedures
•
The Committee is authorized to review and/or investigate any financial, internal
control or risk management related issue or activity of the Company. The
Committee shall report to the Board at the Board’s next regular meeting all such
action it has taken since the previous report.
•
The Committee is authorized to request the presence, at any meeting, of a
representative from the External Auditor, senior management, legal counsel or
anyone else who could contribute to the subject of a meeting.
•
The Committee will review and reassess this Charter at least annually to
determine whether revisions are necessary. The Committee shall periodically
self-assess its performance and effectiveness in fulfilling its role.
•
The minutes of all meetings of the Committee will be provided to the Board. The
Committee shall appoint a secretary of the Committee who shall record the
proceedings of meetings. Supporting schedules and information reviewed by the
Committee will be available for examination by any member of the Board upon
request to the secretary of the Committee.
A-2
(b)
(c)
Financial Strategy and Plans
•
The Committee is authorized to review and approve the Company’s long-term
financing strategy. The financing strategy will be updated at least every three
years.
•
The Committee is authorized to review and approve for recommendation to the
Board from time to time the Company’s annual financing plan and any
amendments thereto and ensure the plan is in accordance with the strategy.
•
The Committee will also review and approve for recommendation to the Board
details of specific proposed financings.
Internal Controls and Risk Management Processes
To assure itself that the Company has appropriate controls and procedures in place to
achieve:
•
Effectiveness and efficiency of operations (including safeguarding of assets);
•
Reliable external financial reporting, including disclosure of financial
information extracted or derived from financial statements; and
•
Compliance with applicable laws and regulations and internal policies;
and
To ensure the Company has appropriate processes in place to manage the principal risks
of its business, the Committee shall:
•
Consider and review internal processes for managing the principal risks of the
Company’s business, including a review of insurance coverage;
•
Obtain assurance from management regarding the adequacy of risk management
processes; and
•
Review with management and the External Auditor:
-
The adequacy of the Company’s internal controls,
computerized information systems, controls and security; and
including
-
Any related significant internal control findings and recommendations of
the External Auditor together with management’s responses thereto.
•
Ensure that the Board, through management, has in place an effective, ongoing
process to identify the potential risks to the Company.
•
Ensure a system is in place to effectively monitor and manage the principal risks
of the Company.
A-3
(d)
•
Regularly review, with management, the strategic environment and emergence of
new opportunities and risks, including any implications on the strategic direction
of the Company.
•
Ensure that the Board is contributing to the development of strategic direction
and approving a strategic plan for the Company that takes into account an
identification of business opportunities and business risks.
Corporate Reporting
1.
Financial Reporting
In order to satisfy itself that the Company’s annual and interim financial
statements are fairly presented in accordance with generally accepted accounting
principles and in a form sufficient for the Committee’s recommendation for approval by
the Board, and that the financial information contained in the Company’s financial
statements, annual report to shareholders and other financial disclosure documents
(including management’s discussion and analysis and annual information forms) are
complete and accurate in all material respects, the Committee shall:
(i)
General
•
Review significant accounting and reporting issues, including recent
professional and regulatory pronouncements, and understand their impact
on the financial statements;
(ii)
Annual and Interim Financial Statements and Other Financial
Information
•
Review the draft financial statements, along with the related press
releases and reports prepared by management which set out the results
and the major factors affecting performance in the reporting period, and
assess the reasonableness of such financial statements;
•
Review any material changes in accounting principles or policies or
financial reporting practises or requirements that may affect the current
period’s financial statements;
•
Review management’s assumptions supporting significant estimates or
judgements affecting the financial statements;
•
Obtain and review any summaries of significant or unusual transactions
and other potentially complex matters whose treatment in the financial
statements merits advance consideration;
•
Review any summary provided by the Company’s legal counsel of the
status of any material pending or threatened litigation, claims and
assessments annually and material changes quarterly;
•
Review the tax status of the Company and monitor the Company’s
approach to tax strategy and risk management, the status of any related
A-4
tax reserves and potential reassessments or other matters which could
affect the financial statements;
•
Review and assess the quality and appropriateness of the Company’s
accounting and reporting principles and policies;
•
Review and discuss the External Auditor’s report in detail with
management;
•
Through discussion with management and the External Auditor, obtain
assurance that the risk of material misstatement of the financial
statements is acceptably low;
•
Through discussion and review with management, obtain assurance that
all required securities certifications and attestations have been completed
and filed as required;
•
Provide to the Board a recommendation as to whether the financial
statements and the related press release should be approved; and
(iii)
Prospectuses and Information Circulars
•
Review the financial information included in any prospectus or
information circular prior to its release and, as appropriate, recommend
to the Board whether such prospectus or information circular should be
approved by the Board.
2.
Management’s Discussion and Analysis (MD&A) Reporting
In order to satisfy itself that the Company’s annual and interim MD&A is
prepared in accordance with general disclosure principles for MD&A, the Committee
shall:
•
Review the MD&A and consider whether the information:
-
Compliments as well as supplements the financial statements;
-
Is reliable, complete, fair and balanced, providing material
information about the Company;
-
Has a forward-looking orientation;
-
Is focused on management’s strategy for generating value over
time; and
-
Is written in plain language, with candour and without
exaggeration, and embodies the qualities of clarity, relevance,
comparability and consistency over reporting periods; and
A-5
•
(e)
Through discussion with management:
-
Obtain assurance that the disclosures comply with regulatory
requirements;
-
Determine what information (1) was omitted due to competitive
concerns; (2) was presented in the prior period but now omitted;
(3) was updated in light of intervening events; or (4) is a
significant issue that is not disclosed; and
-
Determine what, if any, external feedback or advice has been
received on the adequacy of the MD&A.
External Audit
The External Auditor is accountable to the Board, as a representative of the shareholders,
and reports directly to the Committee. The Committee is responsible for overseeing the
work of the External Auditor, including the resolution of disagreements between
management and the External Auditor regarding financial reporting.
In order to assure itself that the external audit function has been effectively carried out
and that any matters that the External Auditor considers appropriate to bring to the
attention of the Board have been addressed, the Committee shall:
•
Recommend to the Board the selection (retention or replacement) of the External
Auditor, considering independence and effectiveness, and recommend approval
of audit fees to be paid to the External Auditor. On an annual basis, the
Committee should review and discuss with the External Auditor all significant
relationships its accountants have with the Company. The Committee will
specifically confirm the External Auditor’s independence and will ensure
management documents the review and assessment.
If there is a
recommendation to change the External Auditor, the Committee shall review all
issues to changes and steps planned for an orderly transition;
•
Review the External Auditor’s audit plan and engagement letter with
management and the External Auditor, including audit scope and approach;
•
Meet with the External Auditor and management in separate private sessions to
discuss any matters that the Committee or either of these groups believes should
be discussed privately with the Committee;
•
Review annually the actual non-audit services and related fees provided by the
External Auditor;
•
Review and pre-approve the planned non-audit services and the related fees
provided by the External Auditor. Any changes in such services and related fees
must be reviewed and approved by the Chair, who will present the item at the
first scheduled meeting following such change;
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(f)
•
Review and assess the performance of the External Auditor, including
consideration of demonstrated external audit judgement and application and
adherence to accounting policies and standards; and
•
Review and approve the hiring policies of the Company regarding partners,
employees and former partners and employees of the present and former External
Auditors.
Whistleblower, Ethics and Internal Controls Complaint Procedures
In order to assure itself that the Company has in place adequate procedures for
complaints received by the Company regarding accounting, internal accounting controls
or auditing matters, the confidential, anonymous submission by employees of the
Company of concerns regarding questionable accounting or auditing matters, and that
these submissions have been investigated effectively, the Committee shall:
(g)
•
Review reports on any fraud, whether or not material, that involves management
or other employees who have a significant role in the Company’s internal
controls. Where the CEO, COO and/or CFO are named in a complaint, an
independent party designated under the whistleblower policy will speak directly
to the Chair;
•
Review and consider any reports on the results of the investigation of
whistleblower, ethics and internal controls complaints;
•
Satisfy itself that management has taken appropriate action to deal with all
complaints; and
•
Satisfy itself that an effective facility and process exists for the anonymous
reporting and investigation of concerns regarding questionable accounting or
auditing matters.
Oversight on Compliance with National Instrument 52-109 Certification of Disclosure
in Issuers’ Annual and Interim Filings (“NI 52-109”)
In order to ensure that the Company is complying with NI 52-109 officer certification
requirements for annual or interim filings, the Committee shall:
•
Receive and review reports from management on the status of the Company’s
progress in documenting and assessing disclosure processes and controls,
documenting and assessing internal controls for financial reporting, remedying
material or significant weaknesses in the design of internal control, assessing the
effectiveness of internal controls and establishing a sustainable framework for
ongoing certification; and
•
Confirm with management that there are no issues or material weaknesses arising
during the reporting period that require specific disclosure in the certification
representation letters. To the extent that there are reportable weaknesses, ensure
that management has appropriate remediation plans to correct the weakness and
further ensure that management has implemented substitute procedures to satisfy
themselves that the financial reports present fairly the financial position.
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IV.
OTHER DUTIES
(a)
Legal and Regulatory Compliance
To provide assurance of Company compliance with all legal and regulatory requirements,
the Committee shall:
(b)
•
At least annually, review the procedures in place for the review of the
Company’s public disclosure of financial information extracted or derived from
the Company’s financial statements;
•
In areas in which it has oversight responsibility, monitor the Company’s
compliance with applicable laws, regulations and internal policies. The
Committee will consider the financial statement implications of applicable laws
and regulations, including the laws and regulations overseen by other committees
of the Board;
•
Receive and review copies of legal letters provided to the External Auditor by inhouse and outside counsel regarding claims and possible claims against the
Company;
•
Make inquiries of management, as well as the External Auditor, to ensure that all
material legal matters have been brought to the attention of the Committee;
•
Obtain assurance from management regarding the Company’s compliance with
applicable laws and regulations in all jurisdictions where the Company does
business; and
•
At least annually, review with the Company’s legal counsel any legal matters that
could have a significant impact on the organization’s financial statements or risk
profile, the Company’s compliance with applicable laws and regulations, and
inquiries received from regulators or governmental agencies.
Code of Business Conduct and Ethics
The Company’s Code of Business Conduct and Ethics (the “Code”) establishes
procedures for the confidential, anonymous submission by employees of the Company
regarding breaches of the Code. Oversight and approval of the Code are the direct
responsibility of the Company’s Corporate Governance & Nominating Committee.
However, all submissions made regarding questionable accounting, auditing, financial
reporting, internal controls or any other matter that may have a material impact on the
reported financial results of the Company are reported to the Committee.
To provide assurance that the necessary submissions are received, the Committee shall
review regularly with management the results of their review of the Company’s
monitoring of compliance with the Code as it relates to employee submissions regarding
questionable accounting, auditing, financial reporting, internal controls or any other
matter that may have a material impact on the reported financial results of the Company.
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(c)
Officer’s Expenses
The Committee shall review the policies and procedures with respect to the chair of the
Board and the CEO’s expense accounts and perquisites, including their use of corporate
assets.
The Committee shall periodically review a summary of major expenses incurred by the
chair of the Board and the CEO.
(d)
Pension and Other Post-Employment Benefits
This section applies to the extent the Company has implemented any Pension and Other
Post-Employment Benefits plans.
The Committee ensures that management has a process in place to accurately calculate
pension and other post-employment benefit liabilities. In addition, the Committee
monitors management’s plans to ensure that sufficient assets exist to meet these
obligations. In contrast, the Company’s Compensation Committee is concerned that
pensions and benefits be consistent with an overall compensation plan that is
motivational and competitive, and which attracts, holds and inspires performance. Any
changes contemplated by the Compensation Committee will potentially impact the total
liabilities of the plans. Accordingly, both the Committee and the Compensation
Committee are concerned with the impact on the plans. To ensure all concerns are
addressed, the Compensation Committee provides a regular report to both committees.
In connection with the foregoing, the Committee shall:
(e)
•
Review pension and other post-employment benefit plan assumptions on a
regular basis and understand the impacts of changes in those assumptions;
•
Review the financial health of the plans, including the annual solvency
calculations; and
•
Review disclosure of pension and other post-employment benefits in the annual
financial statements.
Other Duties
The Committee will perform such other functions as assigned by law or regulation or as
required by the Board.
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