Vail Resorts Management Incentive Plan Senior Executives Grades 33 & Above

The purpose of the Management Incentive Plan (the “Plan”) is to reinforce individual employee behaviors that contribute to the mission, values, growth and profitability of Vail Resorts, Inc. and its wholly owned subsidiaries (collectively, the “Company”) by:

Rewarding and recognizing performance in one or more of the following areas:

 

The Plan is effective and will remain in effect until amended or terminated. The Plan Year will run concurrently with the fiscal year under which the employee is governed.

All full-time employees of the Company at grade levels 33 and above as identified in the Company’s compensation grade structures are eligible to participate in the Plan. Part-time employees are not eligible to participate in the Plan.

The target bonus percentages for employees are determined by the Compensation Committee in its sole discretion on a yearly basis by the end of the first quarter of each fiscal year and while the attainment of Resort, Mountain, Retail and Lodging EBITDA performance targets and corresponding funding levels and VRDC Goals is substantially uncertain.

Each employee’s target bonus incentive is calculated based on the target bonus percentage of his or her annual salary as of the first day of the second quarter of each fiscal year, after all compensation changes are made based on performance in the previous year, except where proration is needed as defined in the proration of target incentives section.

The funding at the end of the fiscal year is based on the final EBITDA results or Division Goal Attainment of the Company’s business divisions and the eligible employee’s incentive target amounts as determined by the Compensation Committee and as defined in Exhibits A and B.

EBITDA Results for each of the Company’s business divisions are defined as follows:

The funding is based on the EBITDA results of the division where the employee works, the scope of his or her responsibilities and where his or her salary expense is charged.

For Corporate executives, the Plan is 85% funded based on Resort EBITDA and 15% funded based on the attainment of the VRDC Goals.

For Mountain executives, the Plan is 85% funded based on Resort EBITDA and 15% funded based on the attainment of the VRDC Goals.

For Lodging executives, the Plan is 75% funded based on Corporate Lodging EBITDA and 25% funded based on Resort EBITDA.

For Retail executives, the Plan is 75% funded based on Retail EBITDA and 25% funded based on Resort EBITDA.

For VRDC executives, the Plan is 75% funded based on the attainment of one or more of the VRDC performance goals and 25% funded based on Resort EBITDA.

The maximum amount that may be earned as an award under the Plan for any Plan year by any one eligible employee shall be $4,000,000.

Funding Variable:

At each fiscal year-end, the funding will be based on the percentage of EBITDA target achieved. The schedule attached hereto as Exhibit A is used to determine the percent of the target incentive funded by Resort, Mountain, Retail and Lodging EBITDA performance. The Compensation Committee will establish the Resort, Mountain, Retail and Lodging EBITDA performance targets and corresponding funding levels and the VRDC Goals and may amend Exhibit A by the end of the first quarter of each fiscal year and while the attainment of such goals

is substantially uncertain. EBITDA results are rounded to the nearest whole percentage using simple rounding.

The incentive payout can be 0% to 130% of the target amount as displayed in Exhibit B.

For employees who have a change to their incentive eligibility or target incentive due to a job change, division change, grade change or compensation change, the incentive will be prorated based on the length of time in each eligible position, taking into account differences in the previous and current job.

No proration will be used if the change occurred prior to the first day of the second quarter of the fiscal year. These employees will receive their entire incentive at the compensation and target percentage of their new position.

Proration calculations will be rounded to full months. It will be considered a full month for all eligible changes that occur on or prior to the 16^thof the month. If the date of the eligible change was after the 16^thof the month, the proration calculation will not count that month. Example: A Corporate employee who on January 18^th moved from grade 33 to grade 34 will have an incentive calculation of 6 months (August through January) at the salary grade 33 target percentage and 6 months (February through July) at the grade 34 target percentage.

Exceptions to the proration rule are at the sole discretion of the Compensation Committee.

An employee hired into a position eligible for this Plan will receive a prorated incentive for the Plan Year based on the number of months worked from the employee’s hire date rounded to the number of full months worked in the Plan Year. A full month will be counted if a new hire was hired on or prior to the 16^th of the month. If the employee is hired after the 16^th of the month, the proration calculation will not count that month. Anyone hired after the16th of the last month in the fiscal year will not be eligible to receive an award in that fiscal year, except at the sole discretion of the Compensation Committee.

Individual incentive determinations for employees who have a paid or unpaid leave of absence (this does not include vacation) in excess of one month during the Plan Year will be prorated to reflect the time on leave.

Individual incentive determinations calculated in accordance with the terms of this Plan will be paid in cash or pursuant to equity awards granted under the Company’s equity compensation plan, or a combination thereof, at the discretion of the Compensation Committee, minus applicable deductions and withholding as required by law, by the close of the first quarter following the previous fiscal year end. Payouts will be rounded to the nearest whole dollar amount.

Incentive payments under the Plan do not vest until the date Plan payments are made. To be eligible to receive a payment, a participant must be employed by the Company on the date Plan payments are made. Employees whose employment ends prior to the payment date under the Plan for any fiscal year will not be eligible, subject to the discretion of the Compensation Committee. However, if an otherwise eligible employee is not employed as of the date of the payout under the Plan due to death or long-term disability under the Company long-term disability plan, such employee, if he or she would have otherwise received a payout under the Plan but for his or her death or disability, shall be entitled to receive a pro-rated payment for the portion of the fiscal year the employee was actively employed.

If an employee terminates employment and is subsequently rehired, eligibility under this Plan restarts with the employee’s rehire date.

In the event that the Board determines there has been a material restatement of publicly issued financial results from those previously issued to the public , the Board will review all incentive payments made to executive officers on the basis of having met or exceeded specific performance targets and, if such payments would have been lower had they been calculated based on such restated results, the Board will, to the extent permitted by governing law, seek to recoup for the benefit of our company such payments made in excess of the amount that would have been paid based on the restated results. This will apply to all incentive payments made during the three-year period prior to the restatement, beginning with payments earned for the 2012 fiscal year. For purposes of this policy, the term “executive officers” has the meaning given in Rule 3b-7 under the Securities Exchange Act of 1934, as amended, and the term “incentive payments” means bonuses and awards under the Plan.

This Plan is administered by the Compensation Committee. The Compensation Committee has authority to interpret the Plan and to make, amend, or nullify any rules and procedures deemed necessary for proper Plan administration, including, but not limited to, performance targets, results and extraordinary events. The EBITDA performance targets and corresponding funding levels shall be adjusted for acquisitions, divestitures, or board imposed unbudgeted expenses in the discretion of the Compensation Committee.

Notwithstanding the foregoing, no Plan payouts will be made until and unless the Compensation Committee has certified that the performance goals and all other material terms have been satisfied. The Compensation Committee has the sole discretion to modify the application of this Plan.

The Plan is not intended to and does not give any employee the right to continued employment with the Company. The Plan does not create a contract of employment with any employee and does not alter the at-will nature of employee’s employment with the Company.

EBITDA Funding Matrix

The following table illustrates how an individual’s performance rating affects the overall Management Incentive Plan Payout.