Vail CEO Aron to sell stock options
VAIL ” Vail Resorts chairman and chief executive officer Adam Aron plans to use options to buy 640,000 shares of Vail Resorts stocks at a discounted price, using the proceeds to finance his new home now under construction in Vail.
Stock options are a way of allowing employees to purchase stock at a set time and price. Typically, options are exercised near their expiration date, or when a stock’s market value is a good deal above the option (or “strike”) price. Monday, Vail Resorts stock closed at a record high of $33.45.
But Aron will have a broker exercise the options between Dec. 12, 2005 and July 20, 2007, with the timing outside his control under a rule limiting liability for executives subject to insider trading sanctions.
In a press release Monday, Aron said this is the first time he has exercised his stock options, and that he needed to act before the options expire over the next three years.
“I trust I am expressing both my strong confidence and commitment here, by retaining a sizable personal investment in Vail Resorts, and also by using the proceeds … to acquire a new residence in Vail for my long-term personal use,” Aron said in the release.
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Aron is not selling any of the 145,000 Vail Resorts shares he already owns, which have a value of about $4.7 million. He also owns 675,000 “in-the-money” options with a value in excess of $8.8 million.
After his options are exercised, Aron will retain about 65 percent of his current holdings in the company, the news release said.
The strike prices for Aron’s older options were not disclosed. In 2004, he was granted options to buy another 120,000 shares at $14.73.
Also on Monday, another Vail Resorts executive cashed out some options, according to a Securities and Exchange Commission filing. Blaise Carrig, senior vice president and chief operating officer of Heavenly Resort in California, exercised an option to purchase 10,000 shares at $15.16 and 6,667 shares at $18.73.
Based on Monday’s closing price, the profit on that transaction would be about $281,038.