As filed with the Securities and Exchange Commission on January 18, 2002
                                                   Registration No.
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                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549
                             -----------------------
                                    FORM S-4

                             REGISTRATION STATEMENT
                        UNDER THE SECURITIES ACT OF 1933
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                               VAIL RESORTS, INC.
             (Exact name of registrant as specified in its charter)

Delaware 7990 51-0291762 (State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer incorporation or organization) Classification Code Number) Identification Number)
----------------------- See Table of Additional Registrants ----------------------- 137 Benchmark Road Avon, Colorado 81620 (970) 845-2500 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) ----------------------- Martha D. Rehm, Esq. Senior Vice President and General Counsel Vail Resorts, Inc. 137 Benchmark Road Avon, Colorado 81620 (970) 845-2500 (Name, address, including zip code, and telephone number, including area code, of agent for service) ----------------------- Copy to: James J. Clark, Esq. Cahill Gordon & Reindel 80 Pine Street New York, New York 10005 (212) 701-3000 ----------------------- Approximate date of commencement of proposed issuance of the securities to the public: As soon as practicable after this Registration Statement becomes effective. If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box. |_| If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. |_| If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. |_| -----------------------
CALCULATION OF REGISTRATION FEE ==================================================================================================================================== Title of Each Class of Securities Amount to Be Proposed Maximum Proposed Maximum Amount of to Be Registered Registered Offering Price Per Unit Aggregate Offering Price Registration Fee (2) (1) - ------------------------------------------------------------------------------------------------------------------------------------ 8 3/4% Senior Subordinated Notes Due 2009........................ $160,000,000 100% $160,000,000 $38,240 - ------------------------------------------------------------------------------------------------------------------------------------ Guarantees of 8 3/4% Senior Subordinated Notes Due 2009..... (3) (3) (3) (3) ====================================================================================================================================
(1) Estimated solely for the purpose of computing the registration fee in accordance with Rule 457(f)(2) under the Securities Act of 1933, as amended (the "Securities Act"). (2) Calculated pursuant to Rule 457(f)(2) under the Securities Act. (3) Pursuant to Rule 457(n), no registration fee is required with respect to the Guarantees. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
Additional Registrants Exact name of State or other Primary Standard registrant as jurisdiction of incor- Industrial Classifi- I.R.S. Employer specified in its charter poration or organization cation Code Number Identification No. Beaver Creek Associates, Inc. Colorado 71392 84-0677537 Beaver Creek Consultants, Inc. Colorado 56151 84-0760348 Beaver Creek Food Services, Inc. Colorado 72231 84-0815288 Breckenridge Resort Properties, Colorado 531311 N/A Inc. Complete Telecommunications, Inc. Colorado 7385 84-1533678 GHTV, Inc. Delaware 551112 39-1284459 Gillett Broadcasting, Inc. Delaware 551112 37-0920781 Grand Teton Lodge Company Wyoming 7211 83-0161154 Jackson Hole Golf and Tennis Wyoming 7997 N/A Club, Inc. JHL&S LLC Wyoming 7211 83-0332983 Keystone Conference Services, Inc. Colorado 72111 84-1075280 Keystone Development Sales, Inc. Colorado 53121 43-1463384 Keystone Food and Beverage Company Colorado 72231 84-0678950 Keystone Resort Property Colorado 531311 84-0705922 Management Company Larkspur Restaurant & Bar, LLC Colorado 7223 84-1510919 Lodge Properties, Inc. Colorado 72111 84-0607010 Lodge Realty, Inc. Colorado 53121 13-3051423 Property Management Acquisition Tennessee 531311 62-1634422 Corp., Inc. Rockresorts Casa Madrona, LLC Delaware 7211 84-1606603 Rockresorts Cheeca, LLC Delaware 7211 84-1606605 Rockresorts Equinox, Inc. Vermont 7211 06-1634157 Rockresorts International, LLC Delaware 7211 84-1606606 Rockresorts LaPosada, LLC Delaware 7211 84-1606604 Rockresorts LLC Delaware 7211 75-2829919 Rockresorts Rosario, LLC Delaware 7211 84-1606602 Teton Hospitality LLC Wyoming 7211 83-0332997 Teton Hospitality Services, Inc. Wyoming 7211 83-0332998 The Vail Corporation Colorado 71392 84-0601461 The Village at Breckenridge Tennessee 72111 62-1633660 Acquisition Corp., Inc. Vail Associates Consultants, Inc. Colorado 53121 84-0738502 Vail Associated Holdings, Ltd. Colorado 53139 84-1214955 Vail Associates Management Company Colorado 531311 84-1248614 Vail Associates Real Estate, Inc. Colorado 53121 84-1013094 Vail Food Services, Inc. Colorado 72231 84-0596378 Vail Holdings, Inc. Colorado 551112 84-0568230 Vail Resorts Development Company Colorado 23311 84-1242948 Vail Summit Resorts, Inc. Colorado 71392 43-1273996 Vail Trademarks, Inc. Colorado 541199 84-1253320 Vail/Arrowhead, Inc. Colorado 23311 84-1253319 Vail/Battle Mountain, Inc. Colorado 53139 84-1146997 Vail/Beaver Creek Resort Colorado 531311 52-1479879 Properties, Inc. VAMHC, Inc. Colorado 7211 N/A Vail RR, Inc. Colorado 7211 84-1606210 VA Rancho Mirage I, Inc. Colorado 7211 84-1606209 VA Rancho Mirage II, Inc. Colorado 7211 84-1606208 VA Rancho Mirage Resort, L.P. Delaware 7211 78-2578150 ===============================================================================================================
The information in this prospectus is not complete and may be changed. We may not consummate the exchange offer until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these notes and is not soliciting an offer to acquire these notes in any state where the offer or sale is not permitted. PROSPECTUS SUBJECT TO COMPLETION, DATED January 18, 2002 VAIL RESORTS, INC. Exchange Offer for $160,000,000 Aggregate Principal Amount of 8 3/4% Senior Subordinated Notes due 2009 -------------------------------- Terms of Exchange Offer: o Expires 5:00 p.m., New York City time, on , 2002 unless extended. o Subject to certain customary conditions which may be waived by us. o All outstanding 8 3/4% Senior Subordinated Notes due 2009 that are validly tendered and not withdrawn will be exchanged. o Tenders of outstanding notes may be withdrawn any time prior to the expiration of this exchange offer. o The exchange of the outstanding notes will not be a taxable exchange for U.S. federal income tax purposes. o We will not receive any cash proceeds from the exchange offer. o The terms of the notes to be issued in exchange for the outstanding notes are substantially identical to the outstanding notes, except for certain transfer restrictions and registration rights relating to the outstanding notes. o Any outstanding notes not validly tendered will remain subject to existing transfer restrictions. See "Risk Factors," beginning on page 17, for a discussion of certain factors that should be considered by holders before tendering their outstanding notes in the exchange offer. There has not previously been any public market for the exchange notes that will be issued in the exchange offer. We do not intend to list the exchange notes on any national stock exchange or on the Nasdaq National Market. There can be no assurance that an active market for such exchange notes will develop. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. ------------------------------------ The date of this prospectus is January , 2002. TABLE OF CONTENTS Page Notice to United Kingdom Residents...........................................i Where You Can Find More Information..........................................i Forward-Looking Statements..................................................ii Prospectus Summary...........................................................1 Summary Consolidated Financial and Operating Data...........................14 Risk Factors................................................................17 Use of Proceeds.............................................................25 Capitalization..............................................................26 The Exchange Offer..........................................................27 Description of Notes........................................................38 Description of Certain Indebtedness.........................................76 Plan of Distribution........................................................78 Certain Federal Income Tax Considerations...................................79 Legal Matters...............................................................83 Independent Public Accountants..............................................83 The exchange offer is not being made to, nor will we accept surrenders for exchange from, holders of outstanding notes in any jurisdiction in which the exchange offer or the acceptance thereof would not be in compliance with the securities or blue sky laws of such jurisdiction. NOTICE TO UNITED KINGDOM RESIDENTS The notes will not be offered or sold to persons in the United Kingdom, except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their business or otherwise in circumstances which have not resulted and will not result in an offer to the public in the United Kingdom within the meaning of the Public Offers of Securities Regulations 1995. This prospectus may only be issued or passed on in or into the United Kingdom to a person who is of a kind described in Article 11(3) of the Financial Services Act 1986 (Investment Advertisements) (Exemption) Order 1996 or after 30 November 2001, in Article 19 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2001, or is a person to whom such document may otherwise lawfully be issued or passed on. WHERE YOU CAN FIND MORE INFORMATION We file annual, quarterly and special reports, proxy statements and other information with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended. The Exchange Act file number for our Commission filings is 001-09614. You may read and copy any document we file at the Commission public reference room at 450 Fifth Street, N.W., Washington, D.C. 20549. You may obtain information on the operation of the public reference room by calling the Commission at 1-800-SEC-0330. We file information electronically with the Commission. Our Commission filings are available from the Commission's Internet site at http://www.sec.gov, which -i- contains reports, proxy and information statements, and other information regarding issuers that file electronically. The Commission allows us to "incorporate by reference" certain documents we file with it, which means that we can disclose important information to you by referring you to those documents. We are incorporating by reference the documents listed below and any future filings we will make with the Commission under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act. o Annual Report on Form 10-K for the year ended July 31, 2001; o Quarterly Report on Form 10-Q for the period ended October 31, 2001, filed on December 13, 2001; and o Proxy Statement on Schedule 14A for the fiscal 2001 Annual Meeting of Shareholders. The information in the documents incorporated by reference is considered to be part of this prospectus, and information in documents that we file later with the Commission will automatically update and supersede such information. Any statement contained in a document incorporated or deemed to by incorporated by reference in this prospectus is modified or superseded for purposes of this prospectus to the extent that a statement contained in this prospectus or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any statement so modified or superseded does not, except as so modified or superseded, constitute a part of this prospectus. We will provide a copy of the documents we incorporate by reference, at no cost, to any person who receives this prospectus, including any beneficial owner of our common stock. To request a copy of any or all of these documents, you should write or telephone us at the following address and telephone number: Vail Resorts, Inc. Post Office Box 7 Vail, Colorado 81658 Telephone: (970) 845-2500 Attention: Investor Relations http://www.vailresorts.com To obtain timely delivery, you must make your request no later than , 2002 (five business days prior to the expiration date for the exchange offer). FORWARD-LOOKING STATEMENTS This prospectus includes and incorporates by reference forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to analyses and other information which are based on forecasts of future results and estimates of amounts not yet -ii- determinable. These statements also relate to our future prospects, developments and business strategies. These forward-looking statements are identified by their use of terms and phrases such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "plan," "predict," "project," "will" and similar terms and phrases, including references to assumptions. These statements are contained in sections entitled "Prospectus Summary," "Risk Factors" and other sections of this prospectus, and in the documents incorporated by reference in this prospectus. Although we believe that our plans, intentions and expectations reflected in or suggested by such forward-looking statements are reasonable, we cannot assure you that such plans, intentions or expectations will be achieved. Important factors that could cause actual results to differ materially from our forward-looking statements are set forth below and elsewhere in this prospectus, including under the section headed "Risk Factors." Such factors include, among others, economic downturns; terrorist acts upon the United States; unfavorable weather conditions; our ability to obtain financing on terms acceptable to us to finance our capital expenditure and growth strategy; our ability to develop our resort and real estate operations; competition in our resort businesses; our reliance on government permits for our use of federal land; our ability to integrate and successfully operate future acquisitions; and adverse changes in the real estate market. All forward-looking statements attributable to us or any persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. Our risks are more specifically described in "Risk Factors" and in our Annual Report on Form 10-K, which is incorporated by reference in this prospectus. If one or more of these risks or uncertainties materialize, or if underlying assumptions prove incorrect, our actual results may vary materially from those expected, estimated or projected. We will not update these forward-looking statements, even if new information, future events or other circumstances have made them incorrect or misleading. -ii- PROSPECTUS SUMMARY The following summary is qualified in its entirety by, and should be read in connection with, the more detailed information and consolidated financial statements (including the notes thereto) appearing elsewhere in, or incorporated by reference into, this prospectus. The terms "Vail," "the Company," "we," "us" and "our" as used in this prospectus refer to Vail Resorts, Inc. and its subsidiaries and predecessors as a combined entity, except where it is clear from the context that such term means only the parent company. Our fiscal year end is July 31. Unless otherwise specified, "ski season" shall mean the period from the opening of any of our mountains for skiing to the closing of our last mountain for skiing, typically late October to early May, and "skier visit" shall mean one guest accessing a ski mountain for all or any part of a day or night and includes both paid and complimentary tickets and ski passes. "Beaver Creek" and other designated trademarks are registered trademarks of Vail Resorts, Inc. The Company Vail Resorts is one of the leading resort operators in North America. Through our premier properties we provide a comprehensive resort experience throughout the year to a diverse clientele with an attractive demographic profile. Included within our resort portfolio are four owned and operated mountain resorts in the Colorado Rocky Mountains: o Vail Mountain-- the largest and most popular single ski mountain complex in North America; o Beaver Creek Resort-- one of the world's premier family-oriented mountain resorts; o Breckenridge Mountain-- an attractive destination resort with numerous apres-ski activities and an extensive bed base; and o Keystone Resort -- a year-round family vacation destination. We are one of the most profitable mountain resort operators due to the following competitive strengths: o ownership of premium resorts; o attractive guest demographics; o strong brand franchise; o scope, diversity and quality of our complementary activities and guest services; and o proximity of our ski resorts to both Denver International Airport and Vail/Eagle County Airport. All of our ski resorts were rated among the top twelve ski resorts in North America in SKI Magazine's October 2001 readers survey, with Vail Mountain rated as the number two ski resort des- -1- tination in North America. We had an 8.7% share of skier visits in the United States for the 2000-01 ski season, with an 8.3% increase in skier visits at our four ski resorts from the 1999-00 ski season. In addition, Vail, Breckenridge and Keystone were the three most visited ski resorts in the United States for the 2000-01 ski season. Our ski resorts are located within 50 miles of each other, which enables us to offer guests the opportunity to visit each ski resort during one vacation stay and participate in common loyalty programs. We also own leading non-ski destination resorts and hotels and operate a premier hospitality management company: o Grand Teton Lodge Company -- premier summer resort properties in and around Grand Teton National Park in Wyoming; and o Rockresorts International, LLC -- a luxury hotel management company currently with 10 properties under management. We also own substantial real estate proximate to our resorts from which we derive significant strategic benefits and cash flow. In addition, we develop and sell technology-based products and services for the hospitality and resort industries. For the quarter ended October 31, 2001, our revenue from resort operations and Resort EBITDA was $57.4 million and a loss of $24.6 million, respectively. It is normal for us to experience losses in resort operations in our first fiscal quarter due to the seasonal nature of our business. For the quarter ended October 31, 2001, our revenue from real estate operations and technology operations was $15.9 million and $1.1 million, respectively. Resort, Real Estate &Technology Resort Vail Mountain Located 100 miles west of Denver, Vail is the largest and most popular single ski mountain complex in North America, offering over 5,200 acres of unique and varied ski terrain interconnected by a large network of high-speed chairlifts. Vail's offerings include the world-famous Back Bowls, a top rated ski and snowboard school and a wide variety of lodging, dining and retail venues. Over the past two years, we have made significant investments in capital improvements, primarily to open Blue Sky Basin, which increased Vail's skiable terrain by approximately 645 acres, as well as to renovate The Lodge at Vail and to fund the expansion and upgrade of Vail's snowmaking systems and grooming equipment. Vail hosted the 1999 and 1989 World Alpine Ski Championships, the first time a North American ski resort has been selected to host this prestigious event twice. For ten of the last fourteen years, Vail has been rated the number one ski resort in North America by SKI Magazine. Vail was the most visited ski resort in the United States for the 2000-01 ski season, attracting in excess of 1.6 million skier visits. -2- Beaver Creek Resort Located ten miles west of Vail, Beaver Creek is one of the world's premier family-oriented mountain resorts, offering its guests a superior level of service in a pristine alpine setting. Known for its unique diversity, European-style village-to-village skiing, exceptional snow quality and an award-winning ski and snowboard school, Beaver Creek offers more than 1,600 acres of skiable terrain, and operates 13 lifts connecting the Beaver Creek, Bachelor Gulch and Arrowhead villages. We have a significant presence of retailing and dining options in Beaver Creek Village and also own and operate two hotels, the Inn at Beaver Creek and The Pines Lodge. In addition, a joint venture, of which we are a partner, has recently commenced the construction of the Ritz-Carlton, Bachelor Gulch, which will be a 5-star hotel with 238 rooms and 23 luxury condominium residences, providing further high-end lodging options for our destination guests. This premier property is scheduled to open in the 2002-03 ski season. Beaver Creek has become one of the most popular resorts in the United States, attracting in excess of 675,000 skier visits in the 2000-01 ski season, its best ski season in its 20 year history. Beaver Creek was rated the number six ski resort in North America in SKI Magazine's October 2001 readers survey. Breckenridge Mountain Located approximately 85 miles west of Denver and 40 miles east of Vail, Breckenridge offers over 2,000 acres of skiing on four different mountain peaks, including open bowl skiing and excellent beginner and intermediate ski terrain. The Town of Breckenridge, situated adjacent to the ski area, has numerous apres-ski activities and an extensive and growing bed base, making it an attractive destination resort for national and international skiers. Since acquiring Breckenridge in 1997, we have made significant capital improvements to the resort, including one high-speed double loading six passenger chairlift, two high-speed quadruple chairlifts, a 50% increase in snowmaking capacity, and the opening of the first new on-mountain restaurant at Breckenridge in more than 12 years. We own and operate two lodging properties in the Town of Breckenridge--The Great Divide Lodge, which has undergone a substantial renovation, and the Village at Breckenridge, a resort property that includes lodging, condominiums and commercial space and serves as the primary portal to Breckenridge Mountain. With more than 1.4 million skier visits, Breckenridge was second only to Vail in terms of skier visits during the 2000-01 ski season. Breckenridge was rated the tenth most popular ski resort in North America in SKI Magazine's October 2001 readers survey. Keystone Resort Located 70 miles west of Denver and 15 miles from Breckenridge, Keystone features over 1,850 acres of skiing on three mountains interconnected by a network of 22 lifts, including two high-speed gondolas, one high speed six passenger chairlift and six high-speed quadruple chairlifts. Keystone has a large and advanced snowmaking system, which provides snowmaking coverage for more than 50% of its skiable terrain and which enables Keystone to be one of the first Rocky Mountain ski resorts to open each ski season and one of the last to close. As the largest single-mountain night skiing experience in North America, with 17 lighted trails including a halfpipe and terrain park, Keystone provides a 12.5-hour ski day. Keystone is a planned family-oriented community that offers numerous year-round activities and amenities, such as the Keystone Conference Center, where capacity was recently doubled, and The River Course, Keystone's second golf course, which opened in -3- 2000. During the 2000-01 ski season, Keystone attracted more than 1.2 million skier visits, the third most visited ski resort in the United States. Keystone was rated the twelfth most popular ski resort in North America in SKI Magazine's October 2001 readers survey. Grand Teton Lodge Company Based in the Jackson Hole valley in Wyoming, Grand Teton owns and operates four premier summer seasonal destination resort properties in and around Grand Teton National Park. Within the park, we operate the Jackson Lake Lodge, a full-service 385-room lodge with conference facilities that can accommodate up to 650 people; the Jenny Lake Lodge, a AAA four-diamond 37-cabin lodge; and Colter Bay Village, a family-oriented facility with 166 log cabins as well as extensive camping and recreational facilities. Outside the park, we own and operate the Jackson Hole Golf and Tennis Club, which has the number one rated golf course (by Golf Digest magazine) in the State of Wyoming. We also operate and have a majority ownership interest in Snake River Lodge & Spa, which has 95 deluxe hotel rooms and 75 luxury condominium bedrooms. Located in Teton Village, Snake River Lodge operates year-round due to its desirable location at the base of the Jackson Hole ski area. Rockresorts International We recently completed the acquisition of a majority interest in Rockresorts International, a luxury resort hotel management company. In connection with this acquisition, we have secured contracts to manage five leading resort hotels across the United States: the Cheeca Lodge in the Florida Keys, The Equinox in Manchester Village, Vermont, La Posada Resort & Spa in Sante Fe, New Mexico, Rosario Resort in the San Juan islands and Casa Madrona in Sausalito, California. We have also flagged and manage six of our existing hotels under the Rockresorts brand: The Great Divide Lodge in Breckenridge, The Lodge at Vail, The Keystone Lodge, The Pines Lodge in Beaver Creek, the Snake River Lodge & Spa and the Lodge at Rancho Mirage. We believe Rockresorts provides a powerful brand name that we can leverage across our existing hotel portfolio and will create additional hotel management opportunities. The Lodge at Rancho Mirage We recently completed the acquisition of the Ritz-Carlton, Rancho Mirage, a four-star hotel located in the Palm Springs area of California. With its variety of luxury amenities, including a full service spa, salon and fitness center, outdoor swimming pool, three restaurants and 12,000 feet of meeting space, the Rancho Mirage caters to the same attractive demographic profile as our ski properties, thereby offering numerous cross-selling opportunities. The hotel has been renamed the Lodge at Rancho Mirage and re-flagged under our Rockresorts brand, expanding our portfolio of premier Rockresorts hotels. Vail Marriott Mountain Resort We acquired the Vail Marriott Mountain Resort from Host Marriott Corporation in December 2001. The Vail Marriott, which we operate, is located 150 yards from Vail's gondola and is the largest hotel in the Vail Valley with 349 rooms and amenities, which include a restaurant and bar, over -4- 16,500 square feet of meeting space, indoor and outdoor pools, a full service spa, a 3,600 square foot fitness center, four tennis courts, and over 4,500 square feet of retail space. Real Estate We also benefit from our extensive holdings of real property in proximity to our resorts. Our real estate operations include the planning, oversight, marketing, infrastructure improvement and development of our real property holdings. As of October 31, 2001, the book value of our real estate held for sale was approximately $173.0 million. In addition to the substantial cash flow generated from real estate sales, our resort operations benefit from these development activities through: o the creation of additional resort lodging which is available to our guests; o the ability to control the architectural theming of our resorts; o the creation of unique facilities and venues which provide us with the opportunity to create new sources of recurring revenue; and o the expansion of our property management and brokerage operations, which are the preferred providers of these services for developments on our land. In order to facilitate the development and sale of its real estate holdings, Vail Resorts Development Company, a wholly owned subsidiary of the Company, also invests in mountain improvements such as ski lifts, snowmaking equipment and trail construction. These mountain improvements enhance the value of the real estate held for sale and also benefit resort operations. Generally, we seek to minimize our exposure to development risks and maximize the long-term value of our real property holdings by selling land to third party developers for cash payments prior to the commencement of construction, while retaining approval of the development plans as well as an interest in the developer's profit. We also typically retain the option to purchase any commercial space created in a development. We are able to secure these benefits from third party developers as a result of the high property values and strong demand associated with property in close proximity to our world-class mountain resort facilities. Technology In addition, we develop and sell technology-based products and services for the hospitality and resort industries. We own a 51% ownership interest in Resort Technology Partners LLC, which develops and sells, among other products, a comprehensive proprietary point-of-sale system tailored to the needs of resort companies. We also have a 49% equity investment in Lowther Ltd., a joint venture with Datalex plc, a leading provider of e-business solutions for the global travel industry. Business Strategy Internal Growth Initiatives. A key component of the business strategy for our mountain resorts has been to expand and enhance our core ski operations, while at the same time increasing the scope, diversity and quality of the complementary activities and services offered to our skiing and non-skiing guests throughout the year. Our resorts derive revenue through a combination of activities -5- available to guests, including lift ticket sales, ski and snowboard lesson packages, a large inventory of resort accommodations, retail and equipment rental outlets, a variety of dining venues, meeting and event planning services and other recreational activities such as golf, tennis, horseback riding, guided fishing, float trips, and on-mountain activities centers. As a result of this strategy, non-lift ticket revenue as a percentage of total Resort revenue has increased to approximately 70% of total Resort revenue in fiscal 2001, as compared to 52% in fiscal 1996. Our focus on developing a comprehensive destination resort experience has also allowed us to attract a diverse guest population with an attractive demographic and economic profile, including a significant number of affluent and family-oriented destination guests, who tend to generate higher and more diversified revenues per guest than day skiers from local population centers. While our Resort revenue per skier visit is currently among the highest in the industry, we estimate that we currently capture only a portion of the total vacation expenditures of an average destination guest at our resorts. In connection with this strategy, we have completed numerous internal growth initiatives over the past several years to add new attractions and improve on-mountain facilities, including: o the addition of Vail's new Blue Sky Basin, 645 acres of natural, gladed ski terrain serviced by four high-speed quadruple chairlifts; o the opening of The River Course at Keystone, Keystone's second 18-hole championship golf course; and o the development of the Red Sky Ranch golf community, located approximately 10 miles west of Beaver Creek, which will include 87 homesites and two championship golf courses. We will also continue to enhance our existing hotel portfolio by completing selective capital improvements on room upgrades and adding hotel facilities, such as spas, meeting rooms, restaurants and other amenities. These expenditures are designed to enhance the overall guest experience, thereby enabling us to increase occupancy rates and average room rates and improve operations. Selective Acquisitions of New Resorts and Properties. We will continue to seek potential acquisitions of additional ski and other destination resorts and properties, which we believe can be successfully integrated into our existing operations, enhance our ability to attract destination guests to all of our resorts and benefit from our capital investment and management expertise. Our 1997 acquisition of Breckenridge and Keystone exemplifies this strategy. We believe we have successfully broadened the appeal of these resorts to destination guests and improved their operating performance through capital investment, coordinated marketing, improved central reservations and common, four-resort lift tickets. We have also realized efficiencies in our purchasing, information systems, accounting and legal areas by sharing these functions across all of our resorts. With our acquisition of Grand Teton in 1999, we capitalized on an opportunity to further leverage our hospitality, dining, retail and recreation expertise while geographically diversifying our resort operations to the state of Wyoming. Furthermore, with its peak season from the late Spring to early Fall, Grand Teton has also significantly increased our summer Resort revenue. -6- We will also continue to selectively acquire hotel properties proximate to our resorts that we believe allow us to broaden our participation in the services available to our guests, increase our ability to offer "package" vacation products and, with respect to our ski resorts, increase Resort revenue per skier visit. The recent acquisition of the Vail Marriott reflects our implementation of this strategy. Expanding Hospitality Business. The personal creation of Laurence Rockefeller in the 1950s, Rockresorts is one of the most storied resort brands in the United States. We believe that leveraging this powerful brand name will enable superior cross-marketing and form the basis for building a luxury resort hospitality business. Our 11 hotel properties currently under Rockresorts management provide us with a coast-to-coast presence, with 1,742 rooms in the aggregate. We believe the acquisition of Rockresorts provides us with an excellent platform for further national and international expansion of our hospitality business either through third party management contracts, management contracts secured with minority equity investments or direct property ownership. Future expansion of our hospitality business will be focused on identifying properties that exhibit superior attributes consistent with the positioning of the Rockresorts brand, including desirable locations, attractive guest demographic profiles and reputation for high quality guest services. Our principal executive offices are located at 137 Benchmark Road, Avon, Colorado 81620 and our telephone number is (970) 845-2500. -7- The Exchange Offer Registration Rights....................... You are entitled to exchange your outstanding notes for freely tradeable exchange notes with substantially identical terms. The exchange offer is intended to satisfy your exchange rights. After the exchange offer is complete, you will no longer be entitled to any exchange or registration rights with respect to your outstanding notes. Accordingly, if you do not exchange your outstanding notes, you will not be able to reoffer, resell or otherwise dispose of your outstanding notes unless you comply with the registration and prospectus delivery requirements of the Securities Act, or there is an exemption available. The Exchange Offer........................ We are offering to exchange $1,000 principal amount of our 8 3/4% Senior Subordinated Notes due 2009, which have been registered under the Securities Act, for $1,000 principal amount of our outstanding 8 3/4% Senior Subordinated Notes due 2009, which were issued in a private offering on November 21, 2001. As of the date of this prospectus, there are $160.0 million principal amount at maturity of outstanding notes. We will issue exchange notes promptly after the expiration of the exchange offer. Resales................................... We believe that the exchange notes issued in the exchange offer may be offered for resale, resold or otherwise transferred by you without compliance with the registration and prospectus delivery requirements of the Securities Act, provided that: o you are acquiring the exchange notes in the ordinary course of your business; o you are not participating, do not intend to participate and have no arrangement or understanding with any person to participate in a distribution of the exchange notes; and o you are not an "affiliate" of ours. If you do not meet the above criteria you will have to comply with the registration and prospectus delivery requirements of the Securities Act in connection with any reoffer, resale or other disposition of your exchange notes. Each broker or dealer that receives exchange notes for its -8- own account in exchange for outstanding notes that were acquired as a result of market-making or other trading activities must acknowledge that it will deliver this prospectus in connection with any sale of exchange notes. Expiration Date........................... 5:00 p.m., New York City time, on , 2002, unless we extend the expiration date. Conditions to the Exchange Offer.......... The exchange offer is subject to certain customary conditions, which may be waived by us. The exchange offer is not conditioned upon any minimum principal amount of outstanding notes being tendered. Procedures for Tendering Outstanding Notes...................... If you wish to tender outstanding notes, you must complete, sign and date the letter of transmittal, or a facsimile of it, in accordance with its instructions and transmit the letter of transmittal, together with your notes to be exchanged and any other required documentation, to The Bank of New York, who is the exchange agent, at the address set forth in the letter of transmittal to arrive by 5:00 p.m., New York City time, on the expiration date. See "The Exchange Offer--Procedures for Tendering Outstanding Notes." By executing the letter of transmittal, you will represent to us that you are acquiring the exchange notes in the ordinary course of your business, that you are not participating, do not intend to participate and have no arrangement or understanding with any person to participate in the distribution of exchange notes, and that you are not an "affiliate" of ours. See "The Exchange Offer--Procedures for Tendering Outstanding Notes." Special Procedures for Beneficial Holders............................. If you are the beneficial holder of outstanding notes that are registered in the name of your broker, dealer, commercial bank, trust company or other nominee, and you wish to tender in the exchange offer, you should contact the person in whose name your outstanding notes are registered promptly and instruct such person to tender on your behalf. See "The Exchange Offer--Outstanding Notes." Guaranteed Delivery Procedures............ If you wish to tender your outstanding notes and you cannot deliver such notes, the letter of transmittal or any other required documents to the exchange agent before the expiration date, you may tender your outstanding notes according to the guaranteed delivery procedures set forth in -9- "The Exchange Offer--Guaranteed Delivery Procedures." Withdrawal Rights......................... Tenders may be withdrawn at any time before 5:00 p.m., New York City time, on the expiration date. Acceptance of Outstanding Notes and Delivery of Exchange Notes............. Subject to certain conditions, we will accept for exchange any and all outstanding notes which are properly tendered in the exchange offer before 5:00 p.m., New York City time, on the expiration date. The exchange notes will be delivered promptly after the expiration date. See "The Exchange Offer--Terms of the Exchange Offer." Certain Federal Income Tax Considerations.......................... The exchange of outstanding notes for exchange notes will not be a taxable event for federal income tax purposes. You will not recognize any taxable gain or loss as a result of exchanging outstanding notes for exchange notes, and you will have the same tax basis and holding period in the exchange notes as you had in the outstanding notes immediately before the exchange. See "Certain Federal Income Tax Considerations." Use of Proceeds........................... We will not receive any proceeds from the issuance of the exchange notes. Exchange Agent............................ The Bank of New York is serving as exchange agent in connection with the exchange offer. The address, telephone number and facsimile number of the exchange agent are set forth in "The Exchange Offer--Exchange Agent." -10- Summary of the Exchange Notes The summary below describes the principal terms of the exchange notes. Certain of the terms and conditions described below are subject to important limitations and exceptions. The "Description of Notes" section of this prospectus contains a more detailed description of the terms and conditions of the exchange notes. Issuer..................................... Vail Resorts, Inc. Notes Offered.............................. $160,000,000 aggregate principal amount of 8 3/4% Senior Subordinated Notes due 2009. Interest Payment Dates..................... Interest will accrue in the exchange notes from the last interest payment date on which interest was paid on the outstanding notes surrendered in exchange therefor or if no interest has been paid on the outstanding notes, from November 21, 2001 and will be payable semi-annually on May 15 and November 15 of each year, commencing May 15, 2002. Maturity................................... May 15, 2009. Original Issue Discount.................... The outstanding Notes were offered at an original issue discount for federal income tax purposes. The exchange notes will have original issue discount identical to that of the outstanding notes. Original issue discount has accrued from the issue date of the outstanding Notes and will continue to accrue and will be included as interest income periodically in a holder's gross income for U.S. federal income tax purposes in advance of receipt of the cash payments to which the income is attributable. See "Certain Federal Income Tax Considerations." Guarantees................................. Certain of our subsidiaries other than those treated as Unrestricted Subsidiaries will guarantee the exchange notes on a senior subordinated basis. Future subsidiaries which are deemed restricted subsidiaries will also be required to guarantee the exchange notes if they guarantee any of our other debt. See "Description of Notes--Guarantees." Ranking.................................... The exchange notes will be unsecured senior subordinated obligations and will be subordinated to all our existing and future senior debt. The exchange notes will rank equally with all our other existing and future senior subordinated debt, including the existing notes, and will rank senior to all our subordinated indebtedness. -11- Our subsidiaries' guarantees with respect to the exchange notes will be general unsecured senior subordinated obligations of such guarantors and will be subordinated to all of such guarantors' existing and future senior debt. The guarantees will rank equally with any senior subordinated indebtedness of the guarantors, including their guarantees of the existing notes, and will rank senior to such guarantors' subordinated debt. Because the exchange notes are subordinated, in the event of bankruptcy, liquidation or dissolution, holders of the exchange notes will not receive any payment until holders of senior indebtedness have been paid in full. The term "senior debt" is defined in the "Description of Exchange Notes--Subordination" section of this prospectus. At December 26, 2001, after giving effect to the offering and the application of the net proceeds, we had approximately $162.8 million of senior debt outstanding on a consolidated basis. Redemption................................. We may redeem the exchange notes, in whole or in part, at any time on or after May 15, 2004, at the declining redemption prices set forth in this prospectus plus accrued interest. Optional Redemption........................ On or prior to May 15, 2002, we may redeem up to 35% of the exchange notes with the net proceeds of certain equity offerings at 108.75% of the principal amount thereof, plus accrued interest, if at least 65% of the aggregate principal amount of the exchange notes remains outstanding. See "Description of Exchange Notes--Optional Redemption." Prior to May 15, 2004, we may also redeem the exchange notes, in whole or in part, upon the occurrence of a change of control at a make-whole price as described under "Description of Exchange Notes--Optional Redemption." Change of Control.......................... Upon certain change of control events, if we do not redeem the exchange notes, each holder of exchange notes may require us to repurchase all or a portion of its exchange notes at a purchase price equal to 101% of the principal amount thereof, plus accrued interest. Our ability to repurchase the exchange notes upon a change of control event will be limited by the terms of our debt agreements, including our Credit Facility. We cannot assure you that we -12- will have the financial resources to repurchase the exchange notes. See "Description of Exchange Notes--Repurchase at the Option of Holders--Change of Control." Certain Covenants.......................... The indenture governing the exchange notes will contain covenants that, among other things, will limit our ability and the ability of certain of our subsidiaries to: o incur additional indebtedness; o pay dividends on, redeem or repurchase our capital stock; o make investments; o engage in transactions with affiliates; o create certain liens; o sell assets; or o consolidate, merge or transfer all or substantially all our assets and the assets of our subsidiaries on a consolidated basis. These covenants are subject to important exceptions and qualifications, which are described in the "Description of Exchange Notes" section of this prospectus. Risk Factors............................... See "Risk Factors" for a discussion of factors you should carefully consider before deciding to invest in the exchange notes. -13- SUMMARY CONSOLIDATED FINANCIAL AND OPERATING DATA The summary historical data for the fiscal years 1997, 1998, 1999, 2000 and 2001 is derived from actual audited results for such years. On September 1, 1997, we changed our fiscal year end from September 30 to July 31. Accordingly, our fiscal year 1998 ended on July 31, 1998 and consisted of ten months. See the "Management's Discussion and Analysis of Financial Condition and Results of Operations" section and our consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K incorporated by reference herein. The summary historical data for the three months ended October 31, 2001 and 2000 is derived from our unaudited consolidated financial statements, which included all adjustments management considers necessary to present fairly the financial results for this interim period. All of these adjustments were of a normal recurring nature. The results of such interim periods are not necessarily indicative of results to be expected for the full year due to the highly seasonal nature of our business (which ordinarily produces losses for the first and fourth quarters). See "Risk Factors--Our business is seasonal in Nature."
Fiscal Fiscal Three Three Ten Year Months Months Months Ended Ended Ended Fiscal Year Ended July 31, Ended September October October ---------------------------------- July 31, 30, 31, 31, 2001 2000 1999 1998 1997 2001 2000 ---------- ---------- ---------- ----------- ---------- --------- ---------- (Unaudited) (In thousands, except per share, per skier visit, percentage and ratio data) Statement of Operations Data: Revenues: Resort---------------- $520,762 $499,415 $431,788 $336,547 $259,038 $57,421 $60,708 Real estate----------- 35,243 51,684 43,912 73,722 71,485 15,850 8,976 Technology------------ 3,274 1,960 -- -- -- 1,059 743 ---------- ---------- ---------- ----------- ---------- --------- ---------- Total revenues------ 559,279 553,059 475,700 410,269 330,523 74,330 70,427 Operating expenses: Resort---------------- 402,662 386,637 345,687 222,201 177,378 81,973 79,331 Real estate----------- 22,971 42,066 34,386 62,619 66,307 9,539 4,309 Technology------------ 5,046 1,676 -- -- -- 1,123 622 Depreciation and amortization---------- 65,167 61,435 53,256 36,838 34,044 15,362 15,643 ---------- ---------- ---------- ----------- ---------- --------- ---------- Total operating expenses------------ 495,846 491,814 433,329 321,658 277,729 107,997 99,905 ---------- ---------- ---------- ----------- ---------- --------- ---------- Income (loss) from operations--------------- 63,433 61,245 42,371 88,611 52,794 (33,667) (29,478) Net income (loss)-------- 18,700 15,338 12,791 41,018 19,698 (24,420) (21,181) Diluted net income (loss) per Common $0.53 $0.44 $0.37 $1.18 $0.64 $(0.70) $(0.61) Share--------------- Other Data: Resort Resort EBITDA (1)----- $118,100 $112,778 $86,101 $114,346 $81,660 $(24,552) $(18,623) Resort EBITDA margin-- 22.7% 22.6% 19.9% 34.0% 31.5% (42.8)% (30.7)% Skier visits (2)------ 4,975 4,595 4,606 4,717 4,273 10 8 Resort revenue per skier visit (3)------- $98.65 $102.35 $91.16 $71.35 $60.62 Real Estate Real estate operating income (4)------------ 12,272 9,618 9,526 11,103 5,178 6,311 4,667 Real estate held for sale and investment 159,177 147,172 152,508 138,916 154,925 172,962 152,364 (5)----------------- -14- Technology Technology operating income (loss)------- (1,772) 284 -- -- -- (64) 121 Total EBITDA (6)--------- 128,600 122,680 95,627 125,449 86,838 (18,305) (13,835) Resort capital expenditures (7)--------- 57,814 77,656 65,168 80,454 51,020 21,173 16,612 Total debt to Resort EBITDA------------------- 3.29 3.50 4.62 2.48 3.25 Resort EBITDA to interest expense--------- 3.69 3.21 3.43 6.43 4.02 Resort EBITDA to pro forma interest expense 2.93 (8)---------------------- Total debt to Total 3.02 3.21 4.16 2.26 3.05 EBITDA------------------- Total EBITDA to interest expense------------------ 4.01 3.49 3.80 7.05 4.28 Total EBITDA to pro forma interest expense 3.19 (8)---------------------- Ratio of earnings to fixed charges (9)-------- 1.77 1.61 1.71 4.85 2.62 Pro forma ratio of earnings to fixed 1.48 charges (10)------------- Balance Sheet Data (at period end): Total assets---------- 1,180,965 1,127,818 1,089,239 912,122 855,949 1,194,367 1,143,742 Long-term debt (including current maturities)--------- 388,380 394,235 398,186 284,014 265,062 418,166 422,030 Stockholders' equity-- $519,171 $493,755 $476,775 $462,624 $405,666 $494,894 $475,405
- ----------------------- (1) Resort EBITDA (earnings before interest expense, income tax expense, depreciation and amortization) is defined as revenues from resort operations less resort operating expenses. Resort EBITDA is not a term that has an established meaning under generally accepted accounting principles ("GAAP"), and it might not be comparable to similarly titled measures reported by other companies. We have included the information concerning Resort EBITDA because our management believes it is an indicative measure of a resort company's operating performance and is generally used by investors to evaluate companies in the resort industry. Resort EBITDA does not purport to represent cash provided by operating activities, and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. For information regarding our historical cash flows from operating, investing and financing activities, see our consolidated financial statements included elsewhere in this prospectus. (2) A skier visit represents one guest accessing a ski mountain for all or any part of a day or night and includes both paid and complimentary tickets and ski passes. (3) Resort revenue per skier visit excludes revenue generated by Grand Teton Lodge Company and Snake River Lodge & Spa from the calculation because those business do not support any of our ski areas. (4) Real estate operating income is defined as revenue from real estate operations less real estate costs and expenses, which include selling and holding costs, operating expenses, and an allocation of the land, infrastructure, mountain improvement and other costs relating to property sold. Real estate costs and expenses exclude charges for depreciation and amortization, as we have determined that the portion of those expenses allocable to real estate is not significant. (5) Real estate held for sale and investment includes all land, development costs and other improvements associated with real estate held for sale and investment, as well as investments in real estate joint ventures. (6) Total EBITDA represents earnings before interest expense, income tax expense, depreciation and amortization. EBITDA is presented because management believes it provides useful information regarding a company's ability to incur and service debt. EBITDA should not be considered in isolation or as a substitute for net income or cash flows prepared in accordance with GAAP, nor should it be used as a measure of our profitability or liquidity. (7) We typically categorize approximately $25 million to $35 million per calendar year of total resort capital expenditures as maintenance capital expenditures. -15- (8) Pro forma interest expense gives effect to the offering of the notes and the repayment of indebtedness under our old credit facility (which may be reborrowed) with the proceeds thereof as if it occurred on July 31, 2001. Pro forma interest expense does not give effect to the interest rates in effect under the Credit Facility, see "Description of Certain Indebtedness." (9) The ratio of earnings to fixed charges represents the number of times fixed charges were covered by pre-tax earnings before provision for interest expense. Fixed charges consist of interest expense, capitalized interest, amortization of debt issuance costs, and a portion of the operating lease expense deemed to be representative of the interest factor. The ratio is not presented for the three months ended October 31, 2001 and 2000 as the ratio is negative for these periods due to the seasonal nature of the Company's business, and is not indicative of results to be expected for a full fiscal year. (10) The pro forma ratio of earnings to fixed charges incorporates the use of pro forma interest expense described in (8) in the calculation of the ratio of earnings to fixed charges. -16- RISK FACTORS You should carefully consider the following factors and other information in this prospectus before deciding to invest in the notes. We are highly leveraged. At October 31, 2001, we had $418.2 million of indebtedness, representing approximately 45.8% of our total capitalization. See "Capitalization." Furthermore, subject to certain restrictions in our Credit Facility and the indenture governing the notes and the existing notes, we, along with our subsidiaries, may incur additional indebtedness from time to time to finance acquisitions, provide for working capital or capital expenditures or for other purposes. Our high level of indebtedness could have important consequences to you, including limiting our ability to: o obtain additional financing for acquisitions, working capital, capital expenditures or other purposes; o use operating cash flow in other areas of our business because we must dedicate a substantial portion of these funds to make principal payments and fund debt service; o borrow additional funds or dispose of assets; o compete with others who are not as highly leveraged; and o react to changing market conditions, changes in our industry and economic downturns. We currently expect that we will be able to service our indebtedness out of cash flow from operations. If we are unable to generate sufficient cash flow to meet our debt service obligations, we will have to pursue one or more alternatives, such as reducing or delaying capital expenditures, refinancing debt, selling assets or raising equity capital. Each of these alternatives is dependent upon financial, business and other general economic factors that affect us, many of which are beyond our control. We cannot assure you that any of these alternatives could be accomplished on satisfactory terms or that they would yield sufficient funds to retire the notes and the indebtedness senior to the notes. While we believe that our cash flow from operations will provide an adequate source of long-term liquidity, a significant drop in operating cash flows resulting from economic conditions, competition or other uncertainties beyond our control would increase the need for alternative sources of liquidity. See the "Management's Discussion and Analysis of Financial Condition and Results of Operations--Liquidity and Capital Resources" section of our Annual Report on Form 10-K incorporated by reference herein. Our future growth requires additional capital whose availability is not assured. We intend to make significant investments in our resorts to maintain our competitive position. We spent approximately $57.8 million and $77.7 million in the fiscal years ended July 31, 2001 and 2000, respectively, on resort capital expenditures and expect to continue making substantial resort capital expenditures. We could finance future expenditures from any of the following sources: o cash flow from operations; -17- o bank borrowings; o public offerings of debt or equity; o private placements of debt or equity; or o some combination of the above. We might not be able to obtain financing for future expenditures on favorable terms. Our recent or future acquisitions might not be successful. In recent years, we have acquired several major ski resorts and other destination resorts and hotel properties, including the Ritz-Carlton, Rancho Mirage, the Vail Marriott and a number of real estate developments. Although we believe we have enhanced our earnings and achieved cost savings by integrating these acquisitions into our operations, we cannot assure you that we will be able to continue this successful integration, manage these acquired properties profitably or increase our profits from these operations. We continually evaluate and are currently evaluating potential acquisitions and intend to actively pursue acquisition opportunities, some of which could be significant. We would face various risks from additional acquisitions, including: o inability to integrate acquired businesses into our operations; o potential goodwill impairment; o diversion of our management's attention; and o unanticipated problems or liabilities. These problems from future acquisitions could adversely affect our operations and financial performance. Terrorist acts upon the United States could have a material adverse effect on us. The terrorist acts carried out against the United States on September 11, 2001 have had an adverse effect on the global travel and leisure industry. We cannot guarantee if or when normal travel and vacation patterns will resume. Furthermore, additional terrorist acts against the United States and the declaration of war by the United States could result in further degradation of discretionary travel upon which our operations are highly dependent. Such degradation could have a material adverse impact on our results of operations. Due to the revenue cancellations and shortfalls relating to September 11th and the weak economy, Resort EBITDA for the first quarter of fiscal 2002 was less than Resort EBITDA in the first quarter of fiscal 2001. As of the date of this prospectus, we anticipate that Resort EBITDA for fiscal 2002, excluding fiscal 2002 acquisitions, will be less than fiscal 2001 Resort EBITDA. Our future development might not be successful. We have significant development plans for our resort and real estate operations. We could experience significant difficulties completing these projects, including: o delays in completion; -18- o inaccurate cost estimates; o difficulty in receiving the necessary regulatory approvals; or o we may not benefit from the projects as we expected. We may not be able to fund these projects with cash flow from operations and borrowings under our Credit Facility if we faced these difficulties. We face significant competition. The number of people who ski in the United States (as measured in skier visits) has increased by approximately 10% since the 1985-86 ski season and there is substantial competition among ski resorts for these customers. The factors that we believe are important to these customers include: o proximity to population centers; o availability and cost of transportation to ski areas; o ease of travel to ski areas (including direct flights by major airlines); o pricing of our products and services; o snowmaking facilities; o type and quality of skiing offered; o duration of the ski season; o weather conditions; o number, quality and price of related services and lodging; and o reputation. We have many competitors for our ski vacationers, including ski resorts in Utah, California, Nevada, New England and the other major resorts in Colorado. Our destination guests can choose from any of these alternatives, as well as non-skiing vacation destinations around the world. Our day skier customers can choose from a number of nearby competitors, including Copper Mountain, Telluride, Steamboat Springs, Winter Park and the Aspen resorts, as well as other forms of leisure such as attendance at movies, sporting events and participation in other indoor and outdoor recreational activities. This competition may adversely affect our skier visits and the pricing of our products and services. We rely on government permits. Virtually all of our ski trails and related activities on Vail, Breckenridge and Keystone and a substantial portion on Beaver Creek are located on federal land. The United States Forest Service has granted us permits to use these lands, but maintains the right to review and approve the location, design and construction of improvements in these areas and on many -19- operational matters. The Forest Service can terminate most of these permits if required in the public interest. Although we do not know of any permit used by a major ski resort then in operation that has been terminated by the Forest Service over the opposition of the permitee, a termination of any of our permits would adversely affect our business and operations. We have applied for several new permits or other approvals for improvements and new development. While these efforts, if not successful, could impact our expansion efforts as currently contemplated, we do not believe they would adversely affect our results of operations or financial condition. Furthermore, Congress may increase the fees we pay to the Forest Service for use of these federal lands. We operate three resort properties within Grand Teton National Park under a concession contract with the National Park Service. The concession contract expires at the end of December 2002, at which time the contract renewal will be subject to a competitive bidding process. Should we not receive the renewal of the concession contract, we would be compensated for the value of our "possessory interest" in the assets of the three resort properties operated under the concession contract, which is generally defined as the replacement cost of such assets less depreciation. We are subject to economic downturns. Skiing and tourism are discretionary recreational activities that can be impacted by a significant economic slowdown, which, in turn, could impact our operating results. Although historically economic downturns have not had an adverse impact on our operating results, there can be no assurance that a decrease in the amount of discretionary spending by the public in the future would not have an adverse effect on us. We are subject to unfavorable weather conditions. The ski industry's ability to attract visitors to its resorts is influenced by weather conditions and the amount and timing of snowfall during the ski season. Unfavorable weather conditions can adversely affect skier visits. In the past 20 years our ski resorts have averaged between 20 and 30 feet of annual snowfall, significantly in excess of the average for U.S. ski resorts. However, there is no assurance that our resorts will receive seasonal snowfalls near the historical average in the upcoming or future ski seasons. Also, the early ski season snow conditions and skier perceptions of early ski season snow conditions influence the momentum and success of the overall ski season. We believe that poor snow conditions early in the ski season during the 1998-99 and 1999-00 ski seasons had an adverse effect on operating results for those periods. There is no way for us to predict future weather patterns or the impact that weather patterns may have on results of operations or visitation. We are dependent on a seasonal workforce. Our resort operations are largely dependent on a seasonal workforce. We recruit worldwide to fill staffing needs each ski season, and utilize H2B visas to enable the use of foreign workers. In addition, we manage seasonal wages and timing of the hiring process to ensure the appropriate workforce is in place. While we do not currently foresee the need to increase seasonal wages to attract employees, we cannot guarantee that such an increase would not be necessary in the future. In addition, we cannot guarantee that we will be able to obtain the visas necessary to hire foreign workers, who are an important source for the seasonal workforce. Increased seasonal wages or an inadequate workforce could have an adverse impact on our results of operations; however, we are unable to predict with any certainty whether such situations will arise or the potential impact to results of operations. -20- Our business is seasonal in nature. Our ski and resort operations are seasonal in nature. In particular, revenues and profits at our ski resorts are substantially lower and historically result in losses in the summer months due to the closure of its ski operations. Snake River Lodge & Spa, while open year-round, generates the majority of its revenues during the winter season. Conversely, Grand Teton Lodge Company's peak operating season occurs during the summer months while the winter season generally results in operating losses due to closure of all revenue generating operations. However, revenues and profits generated by Grand Teton Lodge Company's summer operations are not sufficient to fully offset our off-season losses from our ski resorts. During the 2001 fiscal year, 76.5% of total resort revenues were earned during the second and third fiscal quarters. Quarterly results may be materially affected by the timing of snowfall and the integration of acquisitions. Therefore, the operating results for any three-month period are not necessarily indicative of the results that may be achieved for any subsequent fiscal quarter or for a full fiscal year. We are taking steps to smooth our earnings cycle by investing in additional summer activities, such as golf course development, and also through the acquisition of new resorts, such as Grand Teton Lodge Company. (See Note 13 of the Notes to Consolidated Financial Statements for Selected Quarterly Financial Data included in our Annual Report on Form 10-K incorporated by reference herein.) Apollo Ski Partners has influence over us. Apollo Ski Partners owns approximately 99.9% of our outstanding shares of Class A Common Stock, giving them approximately 21% of the combined voting power with respect to all matters submitted for a vote of all stockholders. The holders of Class A Common Stock elect a class of directors that constitutes two-thirds of our board of directors. Accordingly, Apollo Ski Partners and, indirectly, Apollo Advisors, L.P. (which indirectly controls Apollo Ski Partners) will be able to elect two-thirds of our board of directors and control the approval of matters requiring approval by the board of directors, including mergers, liquidations and asset acquisitions and dispositions. In addition, Apollo Ski Partners and Apollo Advisors, L.P. may be able to significantly influence decisions on matters submitted for stockholder consideration. Future changes in the real estate market could affect the value of our investments. We have extensive real estate holdings in proximity to our mountain resorts. We have made capital expenditures of approximately $40.4 million and $39.2 million in fiscal years 2000 and 2001, respectively, in our real estate operations. We plan to make significant additional investments in developing property at all our resorts. The value of our real property and the revenue from related development activities may be adversely affected by a number of factors, including: o national and local economic climate; o local real estate conditions (such as an oversupply of space or a reduction in demand for real estate in an area); o attractiveness of the properties to prospective purchasers and tenants; o competition from other available property or space; o our ability to obtain adequate insurance; o unexpected construction costs; -21- o government regulations and changes in real estate, zoning or tax laws; o interest rate levels and the availability of financing; and o potential liabilities under environmental and other laws. In addition, we run the risk that our new acquisitions may fail to perform in accordance with our expectations, and that our estimates of the costs of improvements for such properties may prove inaccurate. While we attempt to mitigate our exposure to these risks by selling multi-family development parcels to third-party developers who assume the risk of construction or by pre-selling single-family homesites or condominium residences to individual purchasers prior to the start of our construction projects, we cannot assure you that we will continue to do so in the future. Although we believe that the current market for the sale of our resort property is strong, we cannot assure you that such market conditions will continue. See the "Business--Real Estate" section in our Annual Report on From 10-K incorporated by reference herein. Your claims are subordinated to our and our subsidiaries' senior debt. Payments on the notes and the guarantees are subordinated to all of our and the guarantors' existing and future indebtedness, including amounts under our Credit Facility, other than the existing notes and other than any future indebtedness that expressly provides that it is equal to or subordinated in right of payment to the notes and the guarantees. As a result, upon any distribution to our creditors in a bankruptcy, liquidation or reorganization or similar proceeding with respect to us or our property, the holders of our senior debt and our guarantors' senior debt will be entitled to be paid in full before any payment may be made with respect to the notes and the guarantees. Claims in respect of the notes will be effectively subordinated to all liabilities, including trade payables, of any of our subsidiaries that are not subsidiary guarantors. At December 26, 2001, after giving effect to the offering and the application of the net proceeds, we had approximately $162.8 million of senior debt outstanding on a consolidated basis. Our subsidiary, The Vail Corporation, is the borrower under our $421.0 million revolving Credit Facility and its obligations are guaranteed by us and certain of our subsidiaries. At December 26, 2001, after giving effect to the offering and the application of the net proceeds, we had approximately $55.0 million outstanding, $129.2 million of letters of credit issued thereunder and remaining availability of $236.8 million (subject to limitation by the financial covenants of the Credit Facility). At October 31, 2001, SSI Venture, LLC, in which we have a 51.9% ownership interest, had $20.2 million outstanding under the $25 million SSI Venture Credit Facility, all of which was guaranteed by one of our subsidiaries. See the "Management's Discussion and Analysis of Financial Condition and Results of Operations--Liquidity and Capital Resources" section in our Annual Report on Form 10-K incorporated by reference herein. -22- Guarantees may be unenforceable due to fraudulent conveyance statutes. Although laws differ among various jurisdictions, in general, under fraudulent conveyance laws, a court could subordinate or avoid any subsidiary guarantee if it found that: o the guarantee was incurred with actual intent to hinder, delay or defraud creditors; or o the guarantor did not receive fair consideration or reasonably equivalent value for the guarantee and the guarantor was any of the following: o insolvent or rendered insolvent because of the guarantee; o engaged in business or transactions for which its remaining assets constituted unreasonably small capital; or o intended to incur, or believed that it would incur, debts beyond its ability to pay at maturity. If a court avoided a guarantee as a result of fraudulent conveyance, or held it unenforceable for any other reason, noteholders would cease to have a claim against the guarantor and would be creditors solely of Vail Resorts and the remaining guarantors. There are restrictions imposed by the terms of our indebtedness. The operating and financial restrictions and covenants in our Credit Facility may adversely affect our ability to finance future operations or capital needs or to engage in other business activities. Our Credit Facility includes covenants that will require us to meet certain financial ratios and financial conditions which may require that we take action to reduce debt or to act in a manner contrary to our business objectives. If we breach any of these restrictions or covenants or suffer a material adverse change which restricts our borrowing ability under our Credit Facility, we would be unable to borrow funds thereunder without a waiver. A breach could cause a default under the notes and our other debt. Our indebtedness may then become immediately due and payable. We may not have or be able to obtain sufficient funds to make these accelerated payments, including payments on the notes. In addition, the indenture governing the notes restricts, among other things, our ability to: o borrow money; o pay dividends on stock or make certain other restricted payments; o use assets as security in other transactions; o make investments; o enter into certain transactions with our affiliates; and o sell certain assets or merge with other companies. -23- If we fail to comply with these covenants, we would be in default under the indenture governing the notes, and the principal and accrued interest on the notes would become due and payable. See "Description of Notes--Certain Covenants." There are possible implications from original issue discount. The outstanding notes were issued at an original issue discount ("OID") for U.S. federal income tax purposes. OID is the excess of (i) the stated redemption price at maturity of the notes over (ii) the issue price of the notes. U.S. holders will be required to include the OID in income as it accrues in advance of the receipt of cash payments attributable to such income, regardless of such holders' regular method of accounting for United States federal income tax purposes. The exchange notes will have original issue discount identical to that of the outstanding notes. In addition, if a bankruptcy case is commenced by or against us under the U.S. Bankruptcy Code after the issuance of the notes, the claim of a holder of notes may be limited to an amount equal to the sum of (i) the issue price and (ii) that portion of the OID which is not deemed to constitute "unmatured interest" for purposes of the U.S. Bankruptcy Code. Any OID that was not amortized as of the date of any such bankruptcy filing would constitute "unmatured interest." See "Certain Federal Income Tax Considerations" for a more detailed discussion of the U.S. federal income tax consequences to the holders of notes of the purchase, ownership and disposition of the notes. We may not be able to purchase the notes upon a change of control. Upon certain change of control events, each holder of notes may require us to repurchase all or a portion of its notes at a purchase price equal to 101% of the principal amount thereof, plus accrued interest. Our ability to repurchase the notes upon a change of control event could be limited by the terms of our debt agreements. Upon a change of control event, we may be required to repay the outstanding principal and any accrued interest on any other amounts owed by us under our credit facility. We cannot assure you that we would be able to repay amounts outstanding under our credit facility or obtain necessary consents under such facilities to repurchase these notes. Any requirement to offer to purchase any outstanding notes may result in our having to refinance our outstanding indebtedness, which we may not be able to do. In addition, even if we were able to refinance such indebtedness, such financing may be on terms unfavorable to us. Certain provisions in our credit facility may delay, defer or prevent a merger, tender offer or other takeover attempt. The term "Change of Control" is defined in "Description of Notes--Certain Definitions." The exchange notes will be new securities for which there is currently no public market. We do not intend to list the exchange notes on any national securities exchange or quotation system. The initial purchasers in the offering of outstanding notes have advised us that they currently intend to make a market in the exchange notes, but they are not obligated to do so and, if commenced, may discontinue such market making at any time. Accordingly, no market may develop for the exchange notes, and if a market does develop, it may have limited or no liquidity. Failure to exchange your outstanding notes will leave them subject to transfer restrictions. If you do not exchange your outstanding notes for exchange notes, you will continue to be subject to the restrictions on transfer of your outstanding notes set forth in their legend because the outstanding notes were issued pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. In general, outstanding notes may not be offered or sold, unless registered under the Securities Act, except pursuant to an exemption from, or in a trans- -24- action not subject to, the Securities Act and applicable state securities laws. We currently do not anticipate registering the outstanding notes under the Securities Act. As outstanding notes are tendered and accepted in the exchange offer, the aggregate principal amount of outstanding notes will decrease, which will decrease their liquidity. USE OF PROCEEDS The exchange offer is intended to satisfy certain of our obligations under the registration rights agreement. We will not receive any cash proceeds from the exchange offer. The net proceeds from the original sale of the outstanding notes were $148.1 million. We used the net proceeds from the sale of the outstanding notes to repay indebtedness under our Credit Facility (thereby increasing our borrowing capacity under the Credit Facility). -25- CAPITALIZATION The following table sets forth our capitalization as of October 31, 2001, and as adjusted to reflect the sale of the notes and the application of the estimated net proceeds of this offering. See "Description of Certain Indebtedness."
As Actual Adjusted (In thousands, except share amounts) Cash........................................................................ $21,044 $38,190 ========== ========= Debt: Short-term debt............................................................. $3,143 $3,143 Industrial Development Bonds................................................ 61,700 61,700 Credit facilities(1)........................................................ 150,150 19,150 Notes offered hereby(2)..................................................... -- 152,646 Existing Notes.............................................................. 200,000 200,000 Other....................................................................... 3,173 3,173 ---------- --------- Total debt......................................................... 418,166 439,812 Stockholders' equity: Class A common stock, $0.01 par value, 20,000,000 shares authorized, 7,439,834 shares issued and outstanding................................ 74 74 Common stock, $0.01 par value, 80,000,000 shares authorized, 27,693,821 shares issued and outstanding............................... 277 277 Additional paid-in capital............................................... 411,418 411,418 Retained earnings........................................................ 83,125 83,125 ---------- --------- Total stockholders' equity......................................... 494,894 494,894 ---------- --------- Total capitalization........................................................ $913,060 $934,706 ========== =========
- ------------------------- (1) At December 26, 2001, we had approximately $55.0 million outstanding under the Credit Facility and approximately $19.5 million outstanding under the SSI Venture Credit Facility. (2) Total principal amount $160 million net of Original Issue Discount of $7.4 million. -26- THE EXCHANGE OFFER Purpose and Effect of the Exchange Offer Exchange Offer Registration Statement. We issued the outstanding notes on November 21, 2001. The initial purchasers have advised us that they subsequently resold the outstanding notes to "qualified institutional buyers" in reliance on Rule 144A under the Securities Act and to certain persons in offshore transactions in reliance on Regulation S under the Securities Act. As a condition to the offering of the outstanding notes, we entered into a registration rights agreement dated November 21, 2001, pursuant to which we agreed, for the benefit of all holders of the outstanding notes, at our own expense, to do the following: (1) to file the registration statement of which this prospectus is a part with the Commission on or prior to 60 days after the closing date of the outstanding notes, (2) to use our commercially reasonable best efforts to cause the registration statement to be declared effective under the Securities Act on or prior to 180 days after the closing date of the outstanding notes, (3) to use our commercially reasonable best efforts to keep the registration statement effective until the closing of the exchange offer, and (4) to use our commercially reasonable best efforts to issue, on or prior to 60 days after the date on which the exchange offer registration statement was declared effective by the Commission, exchange notes in exchange for all outstanding notes tendered prior thereto. Further, we agreed to keep the exchange offer open for acceptance for not less than the minimum period required under applicable Federal and state securities laws. For each outstanding Note validly tendered pursuant to the exchange offer and not withdrawn, the holder of the outstanding Note will receive an exchange note having a principal amount equal to that of the tendered outstanding Note. Interest on each exchange note will accrue from the last date on which interest was paid on the tendered outstanding Note in exchange therefor or, if no interest was paid on such outstanding Note, from the issue date. The following is a summary of the registration rights agreement. It does not purport to be complete and it does not contain all of the information you might find useful. For further information you should read the registration rights agreement, a copy of which has been filed as an exhibit to the registration statement. The exchange offer is intended to satisfy certain of our obligations under the registration rights agreement. Transferability. We issued the outstanding notes on November 21, 2001 in a transaction exempt from the registration requirements of the Securities Act and applicable state securities laws. Accordingly, the outstanding notes may not be offered or sold in the United States unless registered or pursuant to an applicable exemption under the Securities Act and applicable state securities laws. Based on no-action letters issued by the staff of the Commission with respect to similar transactions, we believe that the exchange notes issued pursuant to the exchange offer in exchange for outstanding notes may be offered for resale, resold and otherwise transferred by holders of notes who are not our -27- affiliates without further compliance with the registration and prospectus delivery requirements of the Securities Act, provided that: (1) any exchange notes to be received by the holder were acquired in the ordinary course of the holder's business; (2) at the time of the commencement of the exchange offer the holder has no arrangement or understanding with any person to participate in the distribution (within the meaning of the Securities Act) of the exchange notes; and (3) the holder is not an "affiliate" of the Company, as defined in Rule 405 under the Securities Act, or, if it is an affiliate, that it will comply with the registration and prospectus delivery requirements of the Securities Act to the extent applicable. However, we have not sought a no-action letter with respect to the exchange offer and we cannot assure you that the staff of the Commission would make a similar determination with respect to the exchange offer. Any holder who tenders his outstanding notes in the exchange offer with any intention of participating in a distribution of exchange notes (1) cannot rely on the interpretation by the staff of the Commission, (2) will not be able to validly tender outstanding notes in the exchange offer and (3) must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any secondary resale transactions. In addition, each broker-dealer that receives exchange notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. The letter of transmittal accompanying this prospectus states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is acting in the capacity of an "underwriter" within the meaning of Section 2(11) of the Securities Act. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of exchange notes received in exchange for outstanding notes where the outstanding notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. Pursuant to the registration rights agreement, we agreed to make this prospectus available to any such broker-dealer for use in connection with any such resale. Shelf Registration Statement. We will, at our cost, (a) file with the Commission a shelf registration statement covering resales of the outstanding notes as soon as practicable, but, in any event, on or prior to the 60th day after the date we become obligated to file the shelf registration statement, (b) use our commercially reasonable best efforts to cause the shelf registration statement to be declared effective under the Securities Act on or prior to the 180th day after the date we become obligated to file the shelf registration statement and (c) use our commercially reasonable best efforts to keep the shelf registration statement continually effective, supplemented and amended to the extent necessary to ensure that it is available for resales of notes by the holders of Transfer Restricted Securities for a period of at least two years following the effective date of such shelf registration statement (or shorter period that will terminate when all the Notes covered by such shelf registration statement have been sold pursuant to such shelf registration statement or are otherwise no longer Transfer Restricted Securities), if: -28- (1) we are not required to file the exchange offer registration statement or not permitted to consummate the exchange offer because the exchange offer is not permitted by applicable law or Commission policy or (2) any initial purchaser that is a holder of Transfer Restricted Securities notifies us prior to the 20th day following consummation of the exchange offer that (a) it is prohibited by law or Commission policy from participating in the exchange offer or (b) it may not resell the exchange notes acquired by it in the exchange offer to the public without delivering a prospectus and the prospectus contained in the exchange offer registration statement is not appropriate or available for such resales. We will, in the event of the filing of the shelf registration statement, provide to each holder of the outstanding notes copies of the prospectus which is a part of the shelf registration statement, notify each such holder when the shelf registration statement for the outstanding notes has become effective and take certain other action as is required to permit unrestricted resales of the outstanding notes. A holder of outstanding notes who sells such outstanding notes pursuant to the shelf registration statement generally will (1) be required to be named as a selling security holder in the related prospectus, (2) be required to deliver the prospectus to purchasers, (3) be subject to certain of the civil liability provisions under the Securities Act in connection with such sales and (4) be bound by the provisions of the registration rights agreement which are applicable to the holder (including certain indemnification obligations). In addition, each holder of the outstanding notes will be required to deliver information to be used in connection with the shelf registration statement and to provide comments on the shelf registration statement within the time periods set forth in the registration rights agreement in order to have their outstanding notes included in the shelf registration statement and to benefit from the provisions regarding the increase in interest rate set forth in the following paragraph. Terms of the Exchange Offer Upon satisfaction or waiver of all the conditions of the exchange offer, we will accept any and all outstanding notes properly tendered and not withdrawn prior to the expiration date and will issue the exchange notes promptly after acceptance of the outstanding notes. See "--Conditions to the Exchange Offer" and "Procedures for Tendering Private Notes." We will issue $1,000 principal amount of exchange notes in exchange for each $1,000 principal amount of outstanding notes accepted in the exchange offer. As of the date of this prospectus, $160,000,000 aggregate principal amount of the notes are outstanding. Holders may tender some or all of their outstanding notes pursuant to the exchange offer. However, outstanding notes may be tendered only in integral multiples of $1,000. The exchange notes are identical to the outstanding notes except for the elimination of certain transfer restrictions, registration rights, restrictions on holding notes in certificated form and liquidated damages provisions. The exchange notes will evidence the same debt as the outstanding notes and will be issued pursuant to, and entitled to the benefits of, the indenture pursuant to which the outstanding notes were issued and will be deemed one issue of notes, together with the outstanding notes. This prospectus, together with the letter of transmittal, is being sent to all registered holders and to others believed to have beneficial interests in the outstanding -29- notes. Holders of outstanding notes do not have any appraisal or dissenters' rights under the indenture in connection with the exchange offer. We intend to conduct the exchange offer in accordance with the applicable requirements of the Securities Act, the Exchange Act and the rules and regulations of the Commission promulgated thereunder. For purposes of the exchange offer, we will be deemed to have accepted validly tendered private notes when, and as if, we have given oral or written notice thereof to the exchange agent. The exchange agent will act as our agent for the purpose of distributing the exchange notes from us to the tendering holders. If we do not accept any tendered outstanding notes because of an invalid tender, the occurrence of certain other events set forth in this prospectus or otherwise, we will return the unaccepted outstanding notes, without expense, to the tendering holder thereof as promptly as practicable after the expiration date. Holders who tender private notes in the exchange offer will not be required to pay brokerage commissions or fees or, except as set forth below under "--Transfer Taxes," transfer taxes with respect to the exchange of outstanding notes pursuant to the exchange offer. We will pay all charges and expenses, other than certain applicable taxes, in connection with the exchange offer. See "--Fees and Expenses." Expiration Date; Extensions; Amendments The term "expiration date" shall mean 5:00 p.m., New York City time, on , 2002, unless we, in our sole discretion, extend the exchange offer, in which case the term "expiration date" shall mean the latest date and time to which the exchange offer is extended. In order to extend the exchange offer, we will notify the exchange agent by oral or written notice and each registered holder by means of press release or other public announcement of any extension, in each case, prior to 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration date. We reserve the right, in our sole discretion, (1) to delay accepting any outstanding notes, (2) to extend the exchange offer, (3) to terminate the exchange offer if the conditions set forth below under "--Conditions" shall not have been satisfied, or (4) to amend the terms of the exchange offer in any manner. We will notify the exchange agent of any delay, extension, termination or amendment by oral or written notice. We will additionally notify each registered holder of any amendment. We will give to the exchange agent written confirmation of any oral notice. Exchange Date As soon as practicable after the close of the exchange offer we will accept for exchange all outstanding notes properly tendered and not validly withdrawn prior to 5:00 p.m., New York City time, on the expiration date in accordance with the terms of this prospectus and the letters of transmittal. Conditions to the Exchange Offer Notwithstanding any other provisions of the exchange offer, and subject to our obligations under the registration rights agreement, we (1) shall not be required to accept any outstanding notes for exchange, (2) shall not be required to issue exchange notes in exchange for any outstanding notes -30- and (3) may terminate or amend the exchange offer if, at any time before the acceptance of such exchange notes for exchange, any of the following events shall occur: (1) any injunction, order or decree shall have been issued by any court or any governmental agency that would prohibit, prevent or otherwise materially impair our ability to proceed with the exchange offer; (2) any change, or any development involving a prospective change, in our business or financial affairs or any of our subsidiaries has occurred which, in our sole judgment, might materially impair our ability to proceed with the exchange offer or materially impair the contemplated benefits of the exchange offer to us; (3) any law, statute, rule or regulation is proposed, adopted or enacted which, in our sole judgment, might materially impair our ability to proceed with the exchange offer or materially impair the contemplated benefits of the exchange offer to us; (4) any governmental approval has not been obtained, which approval we shall, in our sole discretion, deem necessary for the consummation of the exchange offer as contemplated hereby; or (5) the exchange offer will violate any applicable law or any applicable interpretation of the staff of the Commission. The foregoing conditions are for our sole benefit and may be asserted by us regardless of the circumstances giving rise to any such condition or may be waived by us in whole or in part at any time and from time to time in our sole discretion. Our failure at any time to exercise any of the foregoing rights shall not be deemed a waiver of any such right and such right shall be deemed an ongoing right which may be asserted at any time and from time to time. In addition, we will not accept for exchange any outstanding notes tendered, and no exchange notes will be issued in exchange for any such outstanding notes if at such time any stop order shall be threatened by the Commission or be in effect with respect to the registration statement of which this prospectus is a part or the qualification of the indenture under the Trust Indenture Act of 1939, as amended. The exchange offer is not conditioned on any minimum aggregate principal amount of outstanding notes being tendered for exchange. Consequences of Failure to Exchange Any outstanding notes not tendered pursuant to the exchange offer will remain outstanding and continue to accrue interest. The outstanding notes will remain "restricted securities" within the meaning of the Securities Act. Accordingly, prior to the date that is one year after the later of the issue date and the last date on which we or any of our affiliates was the owner of the outstanding notes, the outstanding notes may be resold only (1) to us, (2) to a person who the seller reasonably believes is a "qualified institutional buyer" purchasing for its own account or for the account of another "qualified institutional buyer" in compliance with the resale limitations of Rule 144A, (3) to an Insti- -31- tutional Accredited Investor that, prior to the transfer, furnishes to the trustee a written certification containing certain representations and agreements relating to the restrictions on transfer of the notes (the form of this letter can be obtained from the trustee), (4) pursuant to the limitations on resale provided by Rule 144 under the Securities Act, (5) pursuant to the resale provisions of Rule 904 of Regulation S under the Securities Act, (6) pursuant to an effective registration statement under the Securities Act, or (7) pursuant to any other available exemption from the registration requirements of the Securities Act, subject in each of the foregoing cases to compliance with applicable state securities laws. As a result, the liquidity of the market for non-tendered outstanding notes could be adversely affected upon completion of the exchange offer. The foregoing restrictions on resale will no longer apply after the first anniversary of the issue date of the outstanding note or the purchase of the outstanding notes from us or an affiliate. Fees and Expenses We will not make any payments to brokers, dealers or others soliciting acceptances of the exchange offer. The principal solicitation is being made by mail; however, additional solicitations may be made in person or by telephone by our officers and employees. Expenses incurred in connection with the exchange offer will be paid by us. Such expenses include, among others, the fees and expenses of the trustee and the exchange agent, accounting and legal fees, printing costs and other miscellaneous fees and expenses. Accounting Treatment We will not recognize any gain or loss for accounting purposes upon the consummation of the exchange offer. We will amortize the expenses of the exchange offer as additional interest expense over the term of the exchange notes. Procedures for Tendering Outstanding Notes The tender of outstanding notes pursuant to any of the procedures set forth in this prospectus and in the letter of transmittal will constitute a binding agreement between the tendering holder and us in accordance with the terms and subject to the conditions set forth in this prospectus and in the letter of transmittal. The tender of outstanding notes will constitute an agreement to deliver good and marketable title to all tendered outstanding notes prior to the expiration date free and clear of all liens, charges, claims, encumbrances, interests and restrictions of any kind. Except as provided in "--Guaranteed Delivery Procedures," unless the outstanding notes being tendered are deposited by you with the exchange agent prior to the expiration date and are accompanied by a properly completed and duly executed letter of transmittal, we may, at our option, reject the tender. Issuance of exchange notes will be made only against deposit of tendered outstanding notes and delivery of all other required documents. Notwithstanding the foregoing, DTC participants tendering through its Automated Tender Offer Program ("ATOP") will be deemed to have made valid delivery where the exchange agent receives an agent's message prior to the expiration date. Accordingly, to properly tender outstanding notes, the following procedures must be followed: -32- Notes held through a Custodian. Each beneficial owner holding outstanding notes through a DTC participant must instruct the DTC participant to cause its outstanding notes to be tendered in accordance with the procedures set forth in this prospectus. Notes held through DTC. Pursuant to an authorization given by DTC to the DTC participants, each DTC participant holding outstanding notes through DTC must (1) electronically transmit its acceptance through ATOP, and DTC will then edit and verify the acceptance, execute a book-entry delivery to the exchange agent's account at DTC and send an agent's message to the exchange agent for its acceptance, or (2) comply with the guaranteed delivery procedures set forth below and in a notice of guaranteed delivery. See "--Guaranteed Delivery Procedures--Notes held through DTC." The exchange agent will (promptly after the date of this prospectus) establish accounts at DTC for purposes of the exchange offer with respect to outstanding notes held through DTC. Any financial institution that is a DTC participant may make book-entry delivery of interests in outstanding notes into the exchange agent's account through ATOP. However, although delivery of interests in the outstanding notes may be effected through book-entry transfer into the exchange agent's account through ATOP, an agent's message in connection with such book-entry transfer, and any other required documents, must be, in any case, transmitted to and received by the exchange agent at its address set forth under "--Exchange Agent," or the guaranteed delivery procedures set forth below must be complied with, in each case, prior to the expiration date. Delivery of documents to DTC does not constitute delivery to the exchange agent. The confirmation of a book-entry transfer into the exchange agent's account at DTC as described above is referred to herein as a "Book-Entry Confirmation." The term "agent's message" means a message transmitted by DTC to, and received by, the exchange agent and forming a part of the book-entry confirmation, which states that DTC has received an express acknowledgment from each DTC participant tendering through ATOP that such DTC participants have received a letter of transmittal and agree to be bound by the terms of the letter of transmittal and that we may enforce such agreement against such DTC participants. Cede & Co., as the holder of the global note, will tender a portion of the global note equal to the aggregate principal amount due at the stated maturity for which instructions to tender are given by DTC participants. By tendering, each holder and each DTC participant will represent to us that, among other things, (1) it is not our affiliate, (2) it is not a broker-dealer tendering outstanding notes acquired directly from us for its own account, (3) it is acquiring the exchange notes in its ordinary course of business and (4) it is not engaged in, and does not intend to engage in, and has no arrangement or understanding with any person to participate in, a distribution of the exchange notes. We will not accept any alternative, conditional, irregular or contingent tenders (unless waived by us). By executing a letter of transmittal or transmitting an acceptance through ATOP, as the case may be, each tendering holder waives any right to receive any notice of the acceptance for purchase of its outstanding notes. -33- We will resolve all questions as to the validity, form, eligibility (including time of receipt) and acceptance of tendered outstanding notes, and such determination will be final and binding. We reserve the absolute right to reject any or all tenders that are not in proper form or the acceptance of which may, in the opinion of our counsel, be unlawful. We also reserve the absolute right to waive any condition to the exchange offer and any irregularities or conditions of tender as to particular outstanding notes. Our interpretation of the terms and conditions of the exchange offer (including the instructions in the letter of transmittal) will be final and binding. Unless waived, any irregularities in connection with tenders must be cured within such time as we shall determine. We, along with the exchange agent, shall be under no duty to give notification of defects in such tenders and shall not incur liabilities for failure to give such notification. Tenders of outstanding notes will not be deemed to have been made until such irregularities have been cured or waived. Any outstanding notes received by the exchange agent that are not properly tendered and as to which the irregularities have not been cured or waived will be returned by the exchange agent to the tendering holder, unless otherwise provided in the letter of transmittal, as soon as practicable following the expiration date. LETTERS OF TRANSMITTAL AND OUTSTANDING NOTES MUST BE SENT ONLY TO THE EXCHANGE AGENT. DO NOT SEND LETTERS OF TRANSMITTAL OR OUTSTANDING NOTES TO US OR DTC. The method of delivery of outstanding notes, letters of transmittal, any required signature guaranties and all other required documents, including delivery through DTC and any acceptance through ATOP, is at the election and risk of the persons tendering and delivering acceptances or letters of transmittal and, except as otherwise provided in the applicable letter of transmittal, delivery will be deemed made only when actually received by the exchange agent. If delivery is by mail, it is suggested that the holder use properly insured, registered mail with return receipt requested, and that the mailing be made sufficiently in advance of the expiration date to permit delivery to the exchange agent prior to the expiration date. Guaranteed Delivery Procedures Notes held through DTC. DTC participants holding outstanding notes through DTC who wish to cause their outstanding notes to be tendered, but who cannot transmit their acceptances through ATOP prior to the expiration date, may cause a tender to be effected if: (1) guaranteed delivery is made by or through a firm or other entity identified in Rule 17Ad-15 under the Exchange Act, including: o a bank; o a broker, dealer, municipal securities dealer, municipal securities broker, government securities dealer or government securities broker; o a credit union; o a national securities exchange, registered securities association or clearing agency; or o a savings institution that is a participant in a Securities Transfer Association recognized program; -34- (2) prior to the expiration date, the exchange agent receives from any of the above institutions a properly completed and duly executed notice of guaranteed delivery (by mail, hand delivery, facsimile transmission or overnight courier) substantially in the form provided with this prospectus; and (3) book-entry confirmation and an agent's message in connection therewith are received by the exchange agent within three NYSE trading days after the date of the execution of the notice of guaranteed delivery. Notes held by Holders. Holders who wish to tender their outstanding notes but (1) whose outstanding notes are not immediately available and will not be available for tendering prior to the expiration date, or (2) who cannot deliver their outstanding notes, the letter of transmittal, or any other required documents to the exchange agent prior to the expiration date, may effect a tender if: o the tender is made by or through any of the above-listed institutions; o prior to the expiration date, the exchange agent receives from any above-listed institution a properly completed and duly executed notice of guaranteed delivery, whether by mail, hand delivery, facsimile transmission or overnight courier, substantially in the form provided with this prospectus; and o a properly completed and executed letter of transmittal, as well as the certificate(s) representing all tendered outstanding notes in proper form for transfer, and all other documents required by the letter of transmittal, are received by the exchange agent within three NYSE trading days after the date of the execution of the notice of guaranteed delivery. Withdrawal Rights You may withdraw tenders of outstanding notes, or any portion of your outstanding notes, in integral multiples of $1,000 principal amount due at the stated maturity, at any time prior to 5:00 p.m., New York City time, on the expiration date. Any outstanding notes properly withdrawn will be deemed to be not validly tendered for purposes of the exchange offer. Notes held through DTC. DTC participants holding outstanding notes who have transmitted their acceptances through ATOP may, prior to 5:00 p.m., New York City time, on the expiration date, withdraw the instruction given thereby by delivering to the exchange agent, at its address set forth under "--Exchange Agent," a written, telegraphic or facsimile notice of withdrawal of such instruction. Such notice of withdrawal must contain the name and number of the DTC participant, the principal amount due at the stated maturity of outstanding notes to which such withdrawal relates and the signature of the DTC participant. Receipt of such written notice of withdrawal by the exchange agent effectuates a withdrawal. -35- Notes held by Holders. Holders may withdraw their tender of outstanding notes, prior to 5:00 p.m., New York City time, on the expiration date, by delivering to the exchange agent, at its address set forth under "--Exchange Agent," a written, telegraphic or facsimile notice of withdrawal. Any such notice of withdrawal must (1) specify the name of the person who tendered the outstanding notes to be withdrawn, (2) contain a description of the outstanding notes to be withdrawn and identify the certificate number or numbers shown on the particular certificates evidencing such outstanding notes and the aggregate principal amount due at the stated maturity represented by such outstanding notes and (3) be signed by the holder of such outstanding notes in the same manner as the original signature on the letter of transmittal by which such outstanding notes were tendered (including any required signature guaranties), or be accompanied by (x) documents of transfer in a form acceptable to us, in our sole discretion, and (y) a properly completed irrevocable proxy that authorized such person to effect such revocation on behalf such holder. If the outstanding notes to be withdrawn have been delivered or otherwise identified to the exchange agent, a signed notice of withdrawal is effective immediately upon written, telegraphic or facsimile notice of withdrawal even if physical release is not yet effected. All signatures on a notice of withdrawal must be guaranteed by a recognized participant in the Securities Transfer Agents Medalion Program, the New York Stock Exchange Medallion Signature Program or the Stock Exchange Medallion Program; provided, however, that signatures on the notice of withdrawal need not be guaranteed if the outstanding notes being withdrawn are held for the account of any of the institutions listed above under "--Guaranteed Delivery Procedures." A withdrawal of an instruction or a withdrawal of a tender must be executed by a DTC participant or a holder of outstanding notes, as the case may be, in the same manner as the person's name appears on its transmission through ATOP or letter of transmittal, as the case may be, to which such withdrawal relates. If a notice of withdrawal is signed by a trustee, partner, executor, administrator, guardian, attorney-in-fact, agent, officer of a corporation or other person acting in a fiduciary or representative capacity, such person must so indicate when signing and must submit with the revocation appropriate evidence of authority to execute the notice of withdrawal. A DTC participant or a holder may withdraw an instruction or a tender, as the case may be, only if such withdrawal complies with the provisions of this prospectus. A withdrawal of a tender of outstanding notes by a DTC participant or a holder, as the case may be, may be rescinded only by a new transmission of an acceptance through ATOP or execution and delivery of a new letter of transmittal, as the case may be, in accordance with the procedures described herein. Exchange Agent The Bank of New York has been appointed as exchange agent for the exchange offer. Questions, requests for assistance and requests for additional copies of this prospectus or of the letter of transmittal should be directed to the exchange agent addressed as follows: -36- By Registered or Certified Mail: The Bank of New York, as Exchange Agent P.O. Box 843 Cooper Station New York, New York 10276 Attention: Corporate Trust Services By Hand before 4:30 p.m.: The Bank of New York 111 Broadway New York, New York 10006 Attention: Lower Level Corporate Trust Window By Hand after 4:30 p.m. or by Overnight Courier: The Bank of New York 770 Broadway, 13th Floor New York, New York 10003 Facsimile: (212) 780-0592 Telephone: (212) 548-6565 Attention: Customer Service The exchange agent also acts as trustee under the Indenture. Transfer Taxes Holders of outstanding notes who tender their outstanding notes for exchange notes will not be obligated to pay any transfer taxes in connection therewith, except that holders who instruct us to register exchange notes in the name of, or request that outstanding notes not tendered or not accepted in the exchange offer be returned to, a person other than the registered tendering holder will be responsible for the payment of any applicable transfer tax thereon. -37- DESCRIPTION OF NOTES General The outstanding notes were and the exchange notes will be issued pursuant to an Indenture (the "Original Indenture"), dated as of November 21, 2001, as amended by the First Supplemental Indenture, dated as of January 16, 2002 (the "Supplemental Indenture" and together with the Original Indenture, the "Indenture"), among the Company, as Issuer, The Vail Corporation, Vail Holdings, Inc. and each of the other Guarantors, as guarantors, and The Bank of New York, as trustee (the "Trustee"). The terms of the exchange notes are identical in all material respects to the outstanding notes, except that the exchange notes have been registered under the Securities Act and, therefore, will not bear legends restricting their transfer and will not contain certain provisions providing for liquidated damages under certain circumstances described in the Registration Rights Agreement, the provisions of which will terminate upon the consummation of the exchange offer. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (the "Trust Indenture Act"). The Notes are subject to all such terms, and Holders of Notes are referred to the Indenture and the Trust Indenture Act for a statement thereof. The following summary of the material provisions of the Indenture does not purport to be complete and is qualified in its entirety by reference to the Indenture, including the definitions therein of certain terms used below. Copies of the Indenture and Registration Rights Agreement can be requested by prospective investors from the Company at the address and telephone number set forth under "Where You Can Find More Information." The definitions of certain terms used in the following summary are set forth below under "Certain Definitions." For purposes of this "Description of Notes," the term "Company" refers only to Vail Resorts, Inc. and not to any of its Subsidiaries and the term "Notes" refers to both the outstanding notes and the exchange notes. The Notes are general unsecured obligations of the Company and are subordinated in right of payment to all existing and future Senior Debt of the Company. As of October 31, 2001, after giving pro forma effect to the offering of the outstanding notes (the "Offering") and the application of the net proceeds therefrom, the Company and the Guarantors would have had consolidated Senior Debt of approximately $87.2 million outstanding. The Indenture, subject to certain limitations, permits the incurrence of additional Senior Debt in the future. As of the date of the Indenture, all of the Company's consolidated Subsidiaries will be Restricted Subsidiaries, other than Boulder/Beaver, LLC, Colter Bay Corporation, Eagle Park Reservoir Company, Forest Ridge Holdings, Inc., Gros Ventre Utility Company, Jackson Lake Lodge Corporation, Jenny Lake Lodge, Inc., Mountain Thunder, Inc., Resort Technology Partners, LLC, RT Partners, Inc., SSI Venture, LLC, Vail Associates Investments, Inc. and VR Holdings, Inc. However, under certain circumstances, the Company is able to designate current or future Subsidiaries as Unrestricted Subsidiaries. Unrestricted Subsidiaries will not be subject to many of the restrictive covenants set forth in the Indenture. The obligations of the Company under the Notes are guaranteed, jointly and severally on a senior subordinated basis, by the Guarantors. The Subsidiary Guarantee of each Guarantor is subordinated in right of payment to all existing and future Senior Debt of such Guarantor. See "--Subsidiary Guarantees." -38- Principal, Maturity and Interest The Notes are limited in aggregate principal amount to $300,000,000 (of which $160,000,000 were issued in the Offering) and will mature on May 15, 2009. Interest on the Notes will accrue at the rate of 8 3/4% per annum and will be payable semi-annually in arrears on May 15 and November 15 of each year, commencing on May 15, 2002, to Holders of record on the immediately preceding May 1 and November 1, respectively. Interest on the Notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of original issuance. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months. Principal of and premium, if any, interest and Liquidated Damages, if any, on the Notes will be payable at the office or agency of the Company maintained for such purpose or, at the option of the Company, payment of interest and Liquidated Damages may be made by check mailed to the Holders of the Notes at their respective addresses set forth in the register of Holders of Notes; provided that all payments of principal, premium, if any, interest and Liquidated Damages, if any, with respect to Notes the Holders of which have given wire transfer instructions to the Company will be required to be made by wire transfer of immediately available funds to the accounts specified by the Holders thereof. Until otherwise designated by the Company, the Company's office or agency will be the office of the Trustee maintained for such purpose. The Notes will be issued in denominations of $1,000 and integral multiples thereof. Subordination The payment (by set-off, redemption, repurchase or otherwise) of principal of and premium, if any, interest and Liquidated Damages, if any, on the Notes (including with respect to any repurchases of the Notes) is subordinated in right of payment, as set forth in the Indenture, to the prior payment in full in cash or, at the option of the holders of Senior Debt of the Company, in Cash Equivalents of all Obligations in respect of Senior Debt of the Company, whether outstanding on the date of the Indenture or thereafter incurred. Upon any distribution to creditors of the Company upon any liquidation, dissolution or winding up of the Company or in a bankruptcy, reorganization, insolvency, receivership or similar proceeding relating to the Company or its property, whether voluntary or involuntary, an assignment for the benefit of creditors or any marshalling of the Company's assets and liabilities, the holders of Senior Debt of the Company are entitled to receive payment in full in cash or, at the option of the holders of Senior Debt of the Company, in Cash Equivalents of all Obligations due or to become due in respect of such Senior Debt (including interest after the commencement of any such proceeding, at the rate specified in the applicable Senior Debt) before the Holders of Notes are entitled to receive any payment of principal of or premium, if any, interest or Liquidated Damages, if any, on the Notes, and until all Obligations with respect to Senior Debt of the Company are paid in full in cash or, at the option of the holders of Senior Debt of the Company, in Cash Equivalents, any distribution of any kind or character to which the Holders of Notes would be entitled shall be made to the holders of Senior Debt of the Company (except that Holders of Notes may receive Permitted Junior Securities and payments made from the trust described under "--Legal Defeasance and Covenant Defeasance" or "--Satisfaction and Discharge of Indenture"). -39- The Company also shall not, directly or indirectly, (x) make any payment of principal of or premium, if any, interest or Liquidated Damages, if any, on the Notes (except in Permitted Junior Securities or from the trust described under "--Legal Defeasance and Covenant Defeasance" or "--Satisfaction and Discharge of Indenture," if no default of the kind referred to in clause (i) below had occurred and was continuing, and no Payment Blockage Notice (as defined below) was in effect, at the time amounts were deposited with the Trustee as described therein) or (y) acquire any of the Notes for cash or property or otherwise or make any other distribution with respect to the Notes if (i) any default occurs and is continuing in the payment when due, whether at maturity, upon any redemption, by declaration or otherwise, of any principal of, or premium, if any, or interest on, any Designated Senior Debt of the Company or (ii) any other default occurs and is continuing with respect to Designated Senior Debt of the Company that permits holders of the Designated Senior Debt of the Company as to which such default relates to accelerate its maturity and the Trustee receives a notice of such default (a "Payment Blockage Notice") from the holders of such Designated Senior Debt of the Company. Payments on the Notes may and shall be resumed (a) in the case of a payment default, upon the date on which such default is cured or waived or otherwise has ceased to exist and (b) in the case of a nonpayment default, upon the earlier of the date on which such nonpayment default is cured or waived or otherwise has ceased to exist or 179 days after the date on which the applicable Payment Blockage Notice is received, unless the maturity of any Designated Senior Debt of the Company has been accelerated and such acceleration remains in full force and effect. No new period of payment blockage may be commenced unless and until 360 days have elapsed since the effectiveness of the immediately prior Payment Blockage Notice. No nonpayment default that existed or was continuing on the date of delivery of any Payment Blockage Notice to the Trustee shall be, or be made, the basis for a subsequent Payment Blockage Notice unless such nonpayment default shall have been waived for a period of not less than 90 days. Each Holder by such Holder's acceptance of a Note irrevocably agrees that if any payment or payments shall be made pursuant to the Indenture and the amount or total amount of such payment or payments exceeds the amount, if any, that such Holder would be entitled to receive upon the proper application of the subordination provisions of the Indenture, then such Holder will be obliged to pay over the amount of such excess payment to the holders of Senior Debt of the Person that made such payment or payments or their representative or representatives, as instructed in a written notice of such excess payment, within ten days of receiving such notice. The Indenture further requires that the Company promptly notify holders of Senior Debt of the Company and the Guarantors if payment of the Notes is accelerated because of an Event of Default. As a result of the subordination provisions described above, in the event of a liquidation or insolvency, Holders of Notes may recover less ratably than creditors of the Company who are holders of Senior Debt. On a pro forma basis, after giving effect to the Offering and the application of the net proceeds therefrom, the principal amount of consolidated Senior Debt of the Company and Guarantors outstanding at October 31, 2001 would have been approximately $87.2 million. The Indenture limits, through certain financial tests, the amount of additional Indebtedness, including Senior Debt, that the Company and its Restricted Subsidiaries can incur. See "--Certain Covenants--Incurrence of Indebtedness and Issuance of Preferred Stock." "Designated Senior Debt" of any Person means (i) any Indebtedness of such Person outstanding under the Credit Agreement and (ii) any other Senior Debt of such Person, the principal -40- amount of which is $25 million or more and that has been designated by the Company as "Designated Senior Debt" of such Person. "Permitted Junior Securities" means Equity Interests (other than Disqualified Stock) in the Company or debt securities that are subordinated to all Senior Debt of the issuer of such debt securities (and any debt securities issued in exchange for Senior Debt of the issuer of such debt securities) to substantially the same extent as, or to a greater extent than, the Notes are subordinated to Senior Debt. "Senior Debt" of any Person means (i) the Obligations of such Person under the Credit Agreement, including, without limitation, Hedging Obligations and reimbursement obligations in respect of letters of credit and bankers acceptances, and (ii) any other Indebtedness of such Person, unless the instrument under which such Indebtedness is incurred expressly provides that it is on a parity with or subordinated in right of payment to the Notes. Notwithstanding anything to the contrary in the foregoing, Senior Debt of a Person will not include (u) any Indebtedness represented by the Existing Notes or by any Guarantee of the Existing Notes, (v) any obligation to, in respect of or imposed by any environmental, landfill, waste management or other regulatory governmental agency, statute, law or court order, (w) any liability for federal, state, local or other taxes, (x) any Indebtedness of such Person to any of its Subsidiaries or other Affiliates, (y) any trade payables or (z) any Indebtedness that is incurred by such Person in violation of the Indenture (except to the extent that the original holder thereof relied in good faith after being provided with a copy of the Indenture upon an Officer's Certificate of such Person to the effect that the incurrence of such Indebtedness did not violate the Indenture). Subsidiary Guarantees The Company's payment obligations under the Notes are jointly and severally guaranteed (the "Subsidiary Guarantees") by all of the Company's consolidated Subsidiaries existing on the Closing Date, other than Boulder/Beaver, LLC, Colter Bay Corporation, Eagle Park Reservoir Company, Forest Ridge Holdings, Inc., Gros Ventre Utility Company, Jackson Lake Lodge Corporation, Jenny Lake Lodge, Inc., Mountain Thunder, Inc., Resort Technology Partners, LLC, RT Partners, Inc., SSI Venture, LLC, Vail Associates Investments, Inc. and VR Holdings, Inc. See Note 14 to "Consolidated Financial Statements" included in our Annual Report on Form 10-K incorporated by reference herein. In addition, VA Rancho Mirage Resort, L.P. and Rockresorts International, LLC (and its subsidiaries), each of which was acquired by the Company on November 15, 2001, and VAMHC, Inc., which was acquired by the Company on December 17, 2001, became Guarantors pursuant to the Supplemental Indenture on January 16, 2002. The Subsidiary Guarantee of each Guarantor are subordinated in right of payment to the same extent as the obligations of the Company in respect of the Notes, as set forth in the Indenture, to the prior payment in full in cash or, at the option of the holders of Senior Debt of such Guarantor, in Cash Equivalents of all Senior Debt of such Guarantor, which would include any Guarantee issued by such Guarantor that constitutes Senior Debt of such Guarantor, including Guarantees of Indebtedness under the Credit Agreement. The Indenture provides that if the Company or any of its Restricted Subsidiaries shall acquire or create another Restricted Subsidiary after the Closing Date, or any Unrestricted Subsidiary shall cease to be an Unrestricted Subsidiary and shall become a Restricted Subsidiary, then, unless such Subsidiary is not required to guarantee and has not guaranteed the Company's Obligations under the Credit Agreement -41- and has not guaranteed any other Indebtedness of the Company or any Restricted Subsidiary, such Subsidiary shall become a Guarantor in accordance with the terms of the Indenture. A Subsidiary shall, without limitation, be deemed to have guaranteed Indebtedness of another Person if such Subsidiary has Indebtedness of the kind described in clause (ii) or clause (iii) of the definition of the term "Indebtedness." The obligations of each Guarantor under its Subsidiary Guarantee will be limited to the maximum amount that would not result in the obligations of such Guarantor under its Subsidiary Guarantee constituting a fraudulent conveyance under applicable law. The Indenture provides that no Guarantor may consolidate with or merge with or into (whether or not such Guarantor is the surviving Person) another Person, whether or not affiliated with such Guarantor, or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets in one or more related transactions to another Person, unless (i) the Person formed by or surviving such consolidation or merger (if other than such Guarantor) or to which such sale, assignment, transfer, lease, conveyance or other disposition shall have been made is a Person organized and existing under the laws of the United States of America, any state thereof or the District of Columbia and expressly assumes all the obligations of such Guarantor, pursuant to a supplemental indenture in form and substance reasonably satisfactory to the Trustee, under the Notes and the Indenture and (ii) immediately after giving effect to such transaction, no Default or Event of Default exists. The provisions of clause (i) of the preceding sentence shall not apply if the Person formed by or surviving the relevant consolidation or merger or to which the relevant sale, assignment, transfer, lease, conveyance or other disposition shall have been made is the Company, a Guarantor or a Person that is not, after giving effect to such transaction, a Restricted Subsidiary of the Company. The Indenture provides that in the event of (i) a merger or consolidation to which a Guarantor is a party, then the Person formed by or surviving such merger or consolidation (if, after giving effect to such transaction, other than the Company or a Restricted Subsidiary of the Company) shall be released and discharged from the obligations of such Guarantor under its Subsidiary Guarantee, (ii) a sale or other disposition (whether by merger, consolidation or otherwise) of all of the Equity Interests of a Guarantor at the time owned by the Company and its Restricted Subsidiaries to any Person that, after giving effect to such transaction, is neither the Company nor a Restricted Subsidiary of the Company, or (iii) the release and discharge of a Guarantor from all obligations under Guarantees of (x) Obligations under the Credit Agreement and (y) any other Indebtedness of the Company or any of its Restricted Subsidiaries, then in each such case such Guarantor shall be released and discharged from its obligations under its Subsidiary Guarantee; provided that, in the case of each of clauses (i) and (ii), (a) the relevant transaction is in compliance with the Indenture, and (b) the Person being released and discharged shall have been released and discharged from all obligations it might otherwise have under Guarantees of Indebtedness of the Company or any of its Restricted Subsidiaries and, in the case of each of clauses (i), (ii) and (iii), immediately after giving effect to such transaction, no Default or Event of Default shall exist. Optional Redemption Except as described below, the Notes are not redeemable at the Company's option prior to May 15, 2004. Thereafter, the Notes will be subject to redemption at any time at the option of the Company, in whole or in part, upon not less than 30 nor more than 60 days' notice, at the redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid inter- -42- est and Liquidated Damages, if any, thereon to the applicable redemption date, if redeemed during the twelve-month period beginning on May 15 of the years indicated below: Year Percentage ---- ---------- 2004........................................ 104.375% 2005........................................ 102.916% 2006........................................ 101.458% 2007 and thereafter......................... 100.000% Notwithstanding the foregoing, at any time on or prior to May 15, 2002, the Company may on any one or more occasions redeem up to 35% of the aggregate principal amount of Notes theretofore issued under the Indenture at a redemption price equal to 108.75% of the principal amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the redemption date, with the net cash proceeds of one or more Equity Offerings; provided that (i) at least 65% of the aggregate principal amount of Notes theretofore issued remain outstanding immediately following each such redemption and (ii) such redemption shall occur within 60 days of the closing of any such Equity Offering. In addition, upon the occurrence of a Change of Control (as defined below) at any time prior to May 15, 2004, the Notes will be subject to redemption at any time at the option of the Company, in whole or in part, upon not less than 30 nor more than 60 days' notice given within 30 days following such Change of Control, at the Make-Whole Price, plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the applicable redemption date. Selection and Notice If less than all of the Notes are to be redeemed at any time, selection of Notes for redemption will be made by the Trustee in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed, or, if the Notes are not so listed, on a pro rata basis, by lot or by such method as the Trustee shall deem fair and appropriate; provided that no Notes of $1,000 or less shall be redeemed in part. Notices of redemption shall be mailed by first class mail at least 30 but not more than 60 days before the redemption date to each Holder of Notes to be redeemed at its registered address. If any note is to be redeemed in part only, the notice of redemption that relates to such note shall state the portion of the principal amount thereof to be redeemed. A new note in principal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancellation of the original note. Notes called for redemption become due on the date fixed for redemption. On and after the redemption date, interest shall cease to accrue on Notes or portions of Notes called for redemption. Mandatory Redemption Except as set forth below under "--Repurchase at the Option of Holders," the Company is not required to make mandatory redemption or sinking fund payments with respect to the Notes. -43- Repurchase at the Option of Holders Change of Control Upon the occurrence of a Change of Control, unless notice of redemption of the notes in whole has been given pursuant to the provisions of the Indenture described above under "Optional Redemption," the Company will be obligated to make an offer (a "Change of Control Offer") to each Holder of Notes to repurchase all or any part (equal to $1,000 or an integral multiple thereof) of such Holder's Notes at an offer price in cash equal to 101% of the aggregate principal amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the date of purchase (the "Change of Control Payment"). Within 30 days following a Change of Control, the Company will mail a notice to each Holder with a copy to the Trustee describing the transaction or transactions that constitute the Change of Control and offering to repurchase Notes on the date specified in such notice, which date shall be no earlier than 30 days and no later than 60 days from the date such notice is mailed (the "Change of Control Payment Date"), pursuant to the procedures required by the Indenture and described in such notice. In addition, the Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the repurchase of the Notes as a result of a Change of Control. On the Change of Control Payment Date, the Company will, to the extent lawful, (i) accept for payment all Notes or portions thereof properly tendered pursuant to the Change of Control Offer, (ii) deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of all Notes or portions thereof so tendered and (iii) deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officers' Certificate stating the aggregate principal amount of Notes or portions thereof being purchased by the Company. The Paying Agent will promptly mail or deliver to each Holder of Notes so tendered the Change of Control Payment for such Notes, and the Trustee will promptly authenticate and mail (or cause to be transferred by book entry) to each Holder a new Note equal in principal amount to any unpurchased portion of the Notes surrendered, if any; provided that each such new Note will be in a principal amount of $1,000 or an integral multiple thereof. The Company will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date. The Company is not required to make a Change of Control Offer following a Change of Control if a third party makes such a Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in the Indenture applicable to a Change of Control Offer made by the Company and purchases all notes validly tendered and not withdrawn pursuant to such Change of Control Offer. The Change of Control provisions described above will be applicable whether or not any other provisions of the Indenture are applicable. Except as described above with respect to a Change of Control, the Indenture does not contain provisions that permit the Holders of the Notes to require that the Company repurchase or redeem the Notes in the event of a takeover, recapitalization or similar transaction. However, restrictions in the Indenture described herein on the ability of the Company and its Restricted Subsidiaries to incur additional Indebtedness, to grant Liens on their respective properties, to make Restricted Payments and to make Asset Sales may also make more difficult or -44- discourage a takeover of the Company, whether favored or opposed by the management of the Company. Consummation of any such transaction in certain circumstances may require repurchase of the Notes, and there can be no assurance that the Company or the acquiring party will have sufficient financial resources to effect such repurchase. Such restrictions and the restrictions on transactions with Affiliates may, in certain circumstances, make more difficult or discourage any leveraged buyout of the Company or any of its Subsidiaries by their management. While such restrictions cover a wide variety of arrangements which have traditionally been used to effect highly leveraged transactions, the Indenture may not afford the Holders of Notes protection in all circumstances from the adverse aspects of a highly leveraged transaction, reorganization, restructuring, merger or similar transaction. The Credit Agreement prohibits the Company from repurchasing any Notes without the prior written consent of lenders holding a majority of the commitments under the Credit Agreement. Any other credit agreements or other agreements governing indebtedness to which the Company becomes a party may contain similar restrictions and provisions and may, like the Credit Agreement, provide that certain change of control events with respect to the Company would constitute events of default thereunder. In the event a Change of Control occurs at a time when the Company is prohibited from repurchasing Notes, the Company could seek the consent of its lenders to the repurchase of Notes or could attempt to refinance or repay the borrowings that contain such prohibition. If the Company does not obtain such a consent or repay such borrowings, the Company will remain prohibited from repurchasing Notes. In such case, the Company's failure to repurchase tendered Notes would constitute an Event of Default under the Indenture which would, in turn, constitute a default under the Credit Agreement. In such circumstances, the subordination provisions in the Indenture would likely restrict payments to the Holders of the Notes. The definition of Change of Control includes a phrase relating to the sale, lease, transfer, conveyance or other disposition of "all or substantially all" of the assets of the Company and its Restricted Subsidiaries taken as a whole. Although there is case law interpreting the phrase "substantially all," there is no precise established definition of the phrase under applicable law. Accordingly, the ability of a Holder of Notes to require the Company to repurchase such Notes as a result of a sale, lease, transfer, conveyance or other disposition of less than all of the assets of the Company and its Restricted Subsidiaries taken as a whole to another Person or group may be uncertain. Asset Sales The Indenture provides that the Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, consummate an Asset Sale unless (i) the Company (or such Restricted Subsidiary, as the case may be) receives consideration at the time of such Asset Sale at least equal to the fair market value (evidenced by a Board Resolution) of the assets or Equity Interests issued or sold or otherwise disposed of and (ii) at least 75% of the consideration therefor received by the Company or such Restricted Subsidiary is in the form of (x) cash or Cash Equivalents or (y) a controlling interest in another business or fixed or other long-term assets, in each case, in a Similar Business; provided that the amount of (a) any liabilities (as shown on the Company's or such Restricted Subsidiary's most recent balance sheet) of the Company or such Restricted Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated to the Notes or any Guarantee thereof) that are assumed by the transferee of any such assets or Equity Interests such that the Company or such Restricted Subsidiary are released from further liability and (b) any securities, -45- Notes or other obligations received by the Company or such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash within 90 days or are guaranteed (by means of a letter of credit or otherwise) by an institution specified in the definition of "Cash Equivalents" (to the extent of the cash received or the obligations so guaranteed) shall be deemed to be cash or Cash Equivalents for purposes of this provision, subject to application as provided in the following paragraph. Within 365 days after the receipt of any Net Proceeds from an Asset Sale, the Company, at its option, may (i) apply such Net Proceeds to permanently prepay, repay or reduce any Senior Debt of the Company (and to correspondingly reduce commitments with respect thereto in the case of revolving borrowings) or (ii) apply such Net Proceeds to the acquisition of a controlling interest in another business, the making of a capital expenditure or the acquisition of other long-term assets, in each case, in a Similar Business, or determine to retain such Net Proceeds to the extent such Net Proceeds constitute such a controlling interest or long-term asset in a Similar Business. Pending the final application of any such Net Proceeds, the Company may invest such Net Proceeds in any manner that is not prohibited by the Indenture. Any Net Proceeds from Asset Sales that are not applied or invested as provided in the first sentence of this paragraph will be deemed to constitute "Excess Proceeds." When the aggregate amount of Excess Proceeds exceeds $10 million, the Company will be required to make an offer to all Holders of Notes (and holders of other Indebtedness of the Company, including the Existing Notes, to the extent required by the terms of such other Indebtedness) (an "Asset Sale Offer") to purchase the maximum principal amount of Notes (and such other Indebtedness) that does not exceed the Excess Proceeds at an offer price in cash in an amount equal to 100% of the principal amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any, thereon to the date of purchase, in accordance with the procedures set forth in the Indenture. To the extent that the aggregate principal amount of Notes (and such other Indebtedness) tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds, the Company may use any remaining Excess Proceeds for general corporate purposes. If the aggregate principal amount of Notes (and such other Indebtedness) tendered exceeds the amount of Excess Proceeds, the Notes (and such other Indebtedness) to be purchased will be selected on a pro rata basis. Upon completion of an Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero. The Asset Sale Offer must be commenced within 60 days following the date on which the aggregate amount of Excess Proceeds exceeds $10 million and remain open for at least 30 and not more than 40 days (unless otherwise required by applicable law). The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the repurchase of notes pursuant to an Asset Sale Offer. The Credit Agreement prohibits the Company from repurchasing any Notes without the prior written consent of lenders holding a majority of the commitments under the Credit Agreement. Any other credit agreements or other agreements governing indebtedness to which the Company becomes a party may contain similar restrictions and provisions. In the event the Company is required to make an Asset Sale Offer at a time when the Company is prohibited from repurchasing Notes, the Company could seek the consent of its lenders to the repurchase of Notes or could attempt to refinance or repay the borrowings that contain such prohibition. If the Company does not obtain such a consent or repay such borrowings, the Company will remain prohibited from repurchasing Notes. In such case, the Company's failure to repurchase tendered Notes would constitute an Event of Default under the Indenture which would, in turn, constitute a default under the Credit Agreement. In such circum- -46- stances, the subordination provisions in the Indenture would likely restrict payments to the Holders of the Notes. Any other credit agreements or other agreements governing indebtedness to which the Company becomes a party may require that the Company and its Subsidiaries apply all proceeds from certain asset sales to repay in full outstanding obligations thereunder prior to the application of such proceeds to repurchase outstanding Notes. Certain Covenants Restricted Payments The Indenture provides that neither the Company nor any of its Restricted Subsidiaries will, directly or indirectly, (i) declare or pay any dividend or make any other payment or distribution on account of the Company's Equity Interests (including, without limitation, any payment in connection with any merger or consolidation involving the Company) or to any direct or indirect holders of the Company's Equity Interests in their capacity as such (other than dividends or distributions (a) payable in Equity Interests (other than Disqualified Stock) of the Company, (b) payable in Capital Stock or assets of an Unrestricted Subsidiary of the Company or (c) payable to the Company or any Restricted Subsidiary of the Company); (ii) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation involving the Company) any Equity Interests of the Company, or any Equity Interests of any of its Restricted Subsidiaries held by any Affiliate of the Company (other than any such Equity Interests owned by the Company or any Restricted Subsidiary of the Company, any Equity Interests then being issued by the Company or a Restricted Subsidiary of the Company or any Investment in a Person that, after giving effect to such Investment, is a Restricted Subsidiary of the Company); (iii) make any payment on or with respect to, or purchase, redeem, repay, defease or otherwise acquire or retire for value, any Indebtedness of the Company or any Guarantor that is subordinated in right of payment to the Notes or any Guarantee thereof, except a regularly scheduled payment of interest or principal or sinking fund payment (other than the purchase or other acquisition of such subordinated Indebtedness made in anticipation of satisfying any sinking fund payment due within one year from the date of acquisition); or (iv) make any Restricted Investment (all such payments and other actions set forth in clauses (i) through (iv) above being collectively referred to as "Restricted Payments"), unless, at the time of and after giving effect to such Restricted Payment: (a) no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof; and (b) the Company would, at the time of such Restricted Payment and after giving pro forma effect thereto as if such Restricted Payment had been made at the beginning of the applicable four-quarter period, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the Consolidated Interest Coverage Ratio test set forth in the first paragraph of the covenant described below under the caption "Incurrence of Indebtedness and Issuance of Preferred Stock"; and -47- (c) such Restricted Payment, together with the aggregate amount of all other Restricted Payments declared or made by the Company and its Restricted Subsidiaries after May 11, 1999 (without duplication and excluding Restricted Payments permitted by clauses (ii) and (iii) of the following paragraph), is less than the sum of (1) 50% of the Consolidated Net Income of the Company for the period (taken as one accounting period) from the beginning of the first fiscal quarter commencing after May 11, 1999 to the end of the Company's most recently ended fiscal quarter for which internal financial statements are available at the time of such Restricted Payment (or, if such Consolidated Net Income for such period is a deficit, less 100% of such deficit); plus (2) 100% of the aggregate net cash proceeds and the fair market value of any assets or property (as determined in good faith by the Board of Directors of the Company) received by the Company from the issue or sale since May 11, 1999 of Equity Interests of the Company (other than Disqualified Stock), or of Disqualified Stock or debt securities of the Company that have been converted into such Equity Interests (other than Equity Interests or Disqualified Stock or convertible debt securities sold to a Subsidiary of the Company and other than Disqualified Stock or convertible debt securities that have been converted into Disqualified Stock); plus (3) with respect to Restricted Investments made after May 11, 1999, the net reduction of such Restricted Investments as a result of (x) any disposition of any such Restricted Investments sold or otherwise liquidated or repaid, to the extent of the net cash proceeds and the fair market value of any assets or property (as determined in good faith by the Board of Directors of the Company) received, (y) dividends, repayment of loans or advances or other transfers of assets to the Company or any Restricted Subsidiary of the Company or (z) the portion (proportionate to the Company's interest in the equity of a Person) of the fair market value of the net assets of an Unrestricted Subsidiary or other Person immediately prior to the time such Unrestricted Subsidiary or other Person is designated or becomes a Restricted Subsidiary of the Company (but only to the extent not included in subclause (1) of this clause (c)); provided that the sum of items (x), (y) and (z) of this subclause (3) shall not exceed, in the aggregate, the aggregate amount of such Restricted Investments made after May 11, 1999. The foregoing provisions will not prohibit (i) the payment of any dividend within 60 days after the date of declaration thereof, if at said date of declaration such payment would have complied with the provisions of the Indenture, (ii) the redemption, repurchase, retirement, defeasance or other acquisition of any subordinated Indebtedness or Equity Interests of the Company in exchange for, or out of the net cash proceeds of the substantially concurrent sale (other than to a Subsidiary of the Company) of, Equity Interests of the Company (other than any Disqualified Stock, except to the extent that such Disqualified Stock is issued in exchange for other Disqualified Stock or the net cash proceeds of such Disqualified Stock is used to redeem, repurchase, retire or otherwise acquire other Disqualified Stock); provided that the amount of any such net cash proceeds that are utilized for any such redemption, repurchase, retirement, defeasance or other acquisition shall be excluded from clause (c)(2) of the preceding paragraph; (iii) the defeasance, redemption, repurchase or other acquisition of subordinated Indebtedness in exchange for, or out of the net cash proceeds from an incurrence of Permitted Refinancing Indebtedness; (iv) the repurchase, redemption or other acquisition or retirement for value of any Equity Interests of the Company or any Restricted Subsidiary of the Company held by any employees, officers or directors of the Company or any of its Restricted Subsidiaries or, upon the death, disability or termination of employment of such officers, directors and employees, their authorized representatives in an aggregate amount not to exceed in any twelve month -48- period, $2.0 million plus the aggregate net cash proceeds from any issuance during such period of Equity Interests by the Company to such employees, officers, directors, or representatives plus the aggregate net cash proceeds from any payments on life insurance policies in which the Company or its Restricted Subsidiaries is the beneficiary with respect to such employees, officers or directors the proceeds of which are used to repurchase, redeem or acquire Equity Interests of the Company held by such employees, officers, directors or representative; (v) the repurchase of Equity Interests of the Company deemed to occur upon the exercise of stock options or similar arrangement if such Equity Interests represents a portion of the exercise price thereof; or (vi) additional Restricted Payments in an amount not to exceed $15 million (less the amount, if any, of any Restricted Payments made after May 11, 1999 and on or prior to the Closing Date that would not have been permitted under any of the foregoing clauses); provided, however, that at the time of, and after giving effect to, any Restricted Payment permitted under clause (iv) or (vi) no Default or Event of Default shall have occurred and be continuing. In the case of any Restricted Payments made other than in cash, the amount thereof shall be the fair market value on the date of such Restricted Payment of the asset(s) or securities proposed to be transferred or issued by the Company or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair market value of any such asset(s) or securities shall be determined in good faith by the Board of Directors of the Company. Where the amount of any Investment made other than in cash is otherwise required to be determined for purposes of the Indenture, then unless otherwise specified such amount shall be the fair market value thereof on the date of such Investment, and fair market value shall be determined in good faith by the Board of Directors of the Company. Designation of Unrestricted Subsidiaries The Board of Directors of the Company may designate any Restricted Subsidiary to be an Unrestricted Subsidiary if such designation would not cause a Default. For purposes of making such determination, all outstanding Investments (including without limitation any direct or indirect obligation to subscribe for additional Equity Interests or maintain or preserve such subsidiary's financial condition or to cause such person to achieve any specified level of operating results) by the Company and its Restricted Subsidiaries (except to the extent repaid) in the Subsidiary so designated will be deemed to be Investments at the time of such designation and, except to the extent, if any, that such Investments are Permitted Investments at such time, will reduce the amount otherwise available for Restricted Payments. All such outstanding Investments will be deemed to constitute Investments in an amount equal to the fair market value of such Investments at the time of such designation. Such designation will only be permitted if such Investment would be permitted at such time and if such Restricted Subsidiary otherwise meets (or would meet concurrently with the effectiveness of such designation) the definition of an Unrestricted Subsidiary. Any such designation by the Board of Directors of the Company shall be evidenced to the Trustee by filing with the Trustee a Board Resolution giving effect to such designation. The Board of Directors of the Company may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such designation shall be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of the Company of any outstanding Indebtedness of such Unrestricted Subsidiary and such designation shall only be permitted if (i) such Indebtedness is permitted under the cove- -49- nant described under the caption "Incurrence of Indebtedness and Issuance of Preferred Stock," and (ii) no Default or Event of Default would be in existence following such designation. To the extent that Unrestricted Subsidiaries were designated as such under the Existing Note Indenture after the issuance of the Existing notes on May 11, 1999 and on or prior to the date of the Indenture, and such designation resulted in or constituted Restricted Payments and/or Permitted Investments under the Existing note Indenture, such designations shall be deemed to have resulted in or constituted Restricted Payments and/or Permitted Investments under the Indenture. Incurrence of Indebtedness and Issuance of Preferred Stock The Indenture provides that neither the Company nor any of its Restricted Subsidiaries will, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt) and that the Company's Restricted Subsidiaries will not issue any shares of Preferred Stock (other than to the Company or a Restricted Subsidiary of the Company); provided, however, that the Company and the Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) if the Consolidated Interest Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred would have been equal to or greater than 2 to 1, determined on a pro forma basis, as if the additional Indebtedness had been incurred at the beginning of such four-quarter period and no Event of Default shall have occurred and be continuing after giving effect on a pro forma basis to such incurrence. The provisions of the first paragraph of this covenant will not apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"): (i) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness under the Credit Agreement in an aggregate amount outstanding (with letters of credit being deemed for all purposes of the Indenture to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries in respect thereof) at any time not to exceed the greater of (x) $450 million and (y) 3.5 times Consolidated Resort EBITDA for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such Indebtedness is being incurred less, in each case, the aggregate amount of such Indebtedness permanently repaid with the Net Proceeds of any Asset Sale; (ii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by (x) the Notes (including the exchange notes), the Guarantees thereof and the Indenture in the principal amount of Notes originally issued on the Closing Date and (y) the Existing notes, the Guarantees thereof and the Existing note Indenture; (iii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness; -50- (iv) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness (other than Hedging Obligations) after May 11, 1999 in an aggregate principal amount not to exceed $50 million at any time outstanding; (v) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness after May 11, 1999 in connection with the acquisition of assets or a new Restricted Subsidiary (including Indebtedness that was incurred by the prior owner of such assets or by such Restricted Subsidiary prior to such acquisition by the Company and its Restricted Subsidiaries); provided that the aggregate principal amount of Indebtedness incurred after May 11, 1999 pursuant to this clause (v) does not exceed $20 million at any time outstanding; (vi) the incurrence by the Company and its Restricted Subsidiaries of Permitted Refinancing Indebtedness; (vii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and its Restricted Subsidiaries; provided, however, that any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company, and any sale or other transfer of any such Indebtedness to a Person that is not the Company or a Restricted Subsidiary of the Company, shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be; (viii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations incurred for the purpose of hedging against fluctuations in currency values or for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness of the Company or any of its Restricted Subsidiaries permitted by the Indenture; provided that the notional principal amount of any Hedging Obligations does not significantly exceed the principal amount of Indebtedness to which such agreement relates; (ix) the Guarantee by the Company or any of its Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company permitted by the Indenture; (x) the incurrence of Indebtedness arising from agreements providing for indemnification, adjustment of purchase price, earn out or other similar obligations, in each case incurred in connection with the acquisition or disposition of any business or assets or subsidiaries of the Company permitted by the Indenture; (xi) the Indebtedness incurred from time to time under a revolving Credit Facility of SSI Venture in an aggregate amount outstanding at any time not to exceed $10 million, so long as SSI Venture remains a Restricted Subsidiary of the Company (as of the Closing Date, SSI Venture is an Unrestricted Subsidiary); and -51- (xii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness not covered by any other clause of this paragraph which is outstanding on the Closing Date and was incurred subsequent to May 11, 1999 in compliance with the Existing Note Indenture. For purposes of determining the amount of any Indebtedness of any Person under this covenant, (a) the principal amount of any Indebtedness of such Person arising by reason of such Person having granted or assumed a Lien on its property to secure Indebtedness of another Person shall be the lower of the fair market value of such property and the principal amount of such Indebtedness outstanding (or committed to be advanced) at the time of determination; (b) the amount of any Indebtedness of such Person arising by reason of such Person having Guaranteed Indebtedness of another Person where the amount of such Guarantee is limited to an amount less than the principal amount of the Indebtedness so Guaranteed shall be such amount as so limited; and (c) Indebtedness shall not include a non-recourse pledge by the Company or any of its Restricted Subsidiaries of Investments in any Person that is not a Restricted Subsidiary of the Company to secure the Indebtedness of such Person. For purposes of determining compliance with this covenant, in the event that an item of Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (xii) above or is entitled to be incurred pursuant to the first paragraph of this covenant, the Company, in its sole discretion, either (a) shall classify (and may later reclassify) such item of Indebtedness in one of such categories in any manner that complies with this covenant or (b) shall divide and classify (and may later redivide and reclassify) such item of Indebtedness into more than one of such categories pursuant to such first paragraph. Liens The Indenture provides that neither the Company nor any of its Restricted Subsidiaries will, directly or indirectly, create, incur, assume or suffer to exist any Lien securing Indebtedness on any asset now owned or here after acquired, or any income or profits therefrom or assign or convey any right to receive income therefrom, except Permitted Liens. Dividend and Other Payment Restrictions Affecting Subsidiaries The Indenture provides that neither the Company nor any of its Restricted Subsidiaries will, directly or indirectly, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to (i) (a) pay dividends or make any other distributions to the Company or any of its Restricted Subsidiaries (1) on its Capital Stock or (2) with respect to any other interest or participation in, or measured by, its profits, or (b) pay any indebtedness or other obligations owed to the Company or any of its Restricted Subsidiaries, (ii) make loans or advances to the Company or any of its Restricted Subsidiaries, (iii) transfer any of its properties or assets to the Company or any of its Restricted Subsidiaries or (iv) guarantee the Notes or any renewals or refinancings thereof, in each case except for such encumbrances or restrictions (other than encumbrances and restrictions in respect of clause (iv) of this sentence) existing under or by reason of (a) Existing Indebtedness as in effect on May 11, 1999, (b) the Credit Agreement (as defined in the Existing Note Indenture) as in effect on May 11, 1999, and any amendments, modifications, re- -52- statements, renewals, increases, supplements, refundings, replacements or refinancings thereof; provided that such amendments, modifications, restatements, renewals, increases, supplements, refundings, replacement or refinancings are no more restrictive with respect to such dividend and other payment restrictions than those contained in the Credit Agreement (as defined in the Existing Note Indenture) as in effect on May 11, 1999, (c) (x) the Existing notes, any Guarantee thereof and the Existing note Indenture and (y) the Notes, any Guarantee thereof and the Indenture, (d) applicable law, (e) any instrument governing Indebtedness or Equity Interests of a Person acquired by the Company or any of its Restricted Subsidiaries as in effect at the time of such acquisition (except to the extent such Indebtedness or Equity Interests were incurred in connection with or in contemplation of such acquisition), which encumbrance or restriction is not applicable to any Person, or the Equity Interests, properties or assets of any Person, other than the Person, or the Equity Interests, property or assets of the Person, so acquired; provided that, in the case of Indebtedness, such Indebtedness was permitted by the Indenture, (f) by reason of customary nonassignment provisions in leases entered into in the ordinary course of business and consistent with past practices, (g) purchase money obligations for property acquired in the ordinary course of business that impose restrictions of the nature described in clause (iii) above on the property so acquired or proceeds therefrom, (h) customary restrictions in asset or stock sale agreements limiting transfer of such assets or stock pending the closing of such sale, (i) customary non-assignment provisions in contracts entered into in the ordinary course of business, or (j) Permitted Refinancing Indebtedness; provided that the restrictions contained in the agreements governing such Permitted Refinancing Indebtedness are no more restrictive than those contained in the agreements governing the Indebtedness being refinanced. Merger, Consolidation or Sale of Assets The Indenture provides that the Company may not consolidate or merge with or into (whether or not the Company is the surviving Person), or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets in one or more related transactions to, another Person unless (i) the Company is the surviving Person or the Person formed by or surviving any such consolidation or merger (if other than the Company) or to which such sale, assignment, transfer, lease, conveyance or other disposition shall have been made is a Person organized or existing under the laws of the United States, any state thereof or the District of Columbia; (ii) the Person formed by or surviving any such consolidation or merger (if other than the Company) or the Person to which such sale, assignment, transfer, lease, conveyance or other disposition shall have been made assumes all the obligations of the Company under the Notes and the Indenture pursuant to a supplemental indenture in a form reasonably satisfactory to the Trustee; (iii) immediately after giving effect to such transaction no Default or Event of Default exists; and (iv) except in the case of a merger of the Company with or into a Restricted Subsidiary of the Company, the Company or the Person formed by or surviving any such consolidation or merger (if other than the Company), or to which such sale, assignment, transfer, lease, conveyance or other disposition shall have been made, (a) will have Consolidated Net Worth immediately after the transaction equal to or greater than the Consolidated Net Worth of the Company, immediately preceding the transaction and (b) will, at the time of such transaction and after giving pro forma effect thereto as if such transaction had occurred at the beginning of the applicable four-quarter period, be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Consolidated Interest Coverage Ratio test set forth in the first paragraph of the covenant described above under the caption "Incurrence of Indebtedness and Issuance of Preferred Stock." -53- Nothing contained in the foregoing paragraph shall prohibit (i) any Restricted Subsidiary from consolidating with, merging with or into, or transferring all or part of its properties and assets to the Company or (ii) the Company from merging with an Affiliate for the purpose of reincorporating the Company in another jurisdiction to realize tax or other benefits; provided, however, that in connection with any such merger, consolidation or asset transfer no consideration, other than common stock (that is not Disqualified Stock) in the surviving Person or the Company shall be issued or distributed. Transactions with Affiliates The Indenture provides that neither the Company nor any of its Restricted Subsidiaries will make any payment to, or sell, lease, transfer or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction, contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate (each of the foregoing, an "Affiliate Transaction"), unless (i) such Affiliate Transaction is on terms that are no less favorable to Company or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction by the Company or such Restricted Subsidiary with an unrelated Person and (ii) the Company delivers to the Trustee (a) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate payments or consideration in excess of $5.0 million, a Board Resolution authorizing and determining the fairness of such Affiliate Transaction approved by a majority of the independent members of the Board of Directors of the Company and (b) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate payments or consideration in excess of $15.0 million, an opinion as to the fairness to the Company or such Restricted Subsidiary of such Affiliate Transaction from a financial point of view issued by an accounting, appraisal or investment banking firm of national standing. The foregoing provisions will not prohibit (i) reasonable fees and compensation paid to and indemnity provided on behalf of officers, directors, employees, agents or consultants of the Company or any Restricted Subsidiary of the Company as determined in good faith by the Company's Board of Directors or senior management including, without limitation, any issuance of Equity Interests of the Company pursuant to stock option, stock ownership or similar plans; (ii) transactions between or among the Company and/or its Restricted Subsidiaries; (iii) any agreement or arrangement as in effect on May 11, 1999 and publicly disclosed or any amendment thereto or any transaction contemplated thereby (including pursuant to any amendment thereto) in any replacement agreement or arrangement thereto so long as any such amendment or replacement agreement or arrangement is not more disadvantageous to the Company or its Restricted Subsidiaries, as the case may be, in any material respect than the original agreement as in effect on May 11, 1999; (iv) loans or advances to employees and officers of the Company and its Restricted Subsidiaries not in excess of $5 million at any time outstanding; and (v) any Permitted Investment or any Restricted Payment that is permitted by the provisions of the Indenture described above under the caption "Restricted Payments." Limitation on Layering Debt The Indenture provides that (a) the Company will not, directly or indirectly, incur, create, issue, assume, guarantee or otherwise become liable for any Indebtedness that is by its terms subordinate or junior in right of payment to any Senior Debt of the Company and senior in any respect in -54- right of payment to the Notes and (b) no Guarantor will, directly or indirectly, incur, create, issue, assume, guarantee or otherwise become liable for any Indebtedness that is by its terms subordinate or junior in right of payment to any Senior Debt of such Guarantor and senior in any respect in right of payment to the Subsidiary Guarantee of such Guarantor. Additional Subsidiary Guarantees The Indenture provides that if any Restricted Subsidiary of the Company after the date of the Indenture shall become or be required to become a guarantor under the Credit Agreement or shall become a guarantor of any other Indebtedness of the Company or any Restricted Subsidiary, then such Restricted Subsidiary shall become a Guarantor, in accordance with the terms of the Indenture; provided that if such Restricted Subsidiary is released and discharged from all obligations under such guarantees, it shall be released and discharged from its obligations under its Subsidiary Guarantee as described under "--Subsidiary Guarantees" above. Payments for Consent The Indenture provides that neither the Company nor any of its Restricted Subsidiaries will, directly or indirectly, pay or cause to be paid any consideration, whether by way of interest, fee or otherwise, to any Holder of any Notes for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of the Indenture or the Notes unless such consideration is offered to be paid or is paid to all Holders of the Notes that consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to such consent, waiver or agreement. Reports The Indenture provides that, whether or not required by the rules and regulations of the Commission, so long as any Notes are outstanding, the Company will furnish to the Holders of Notes (i) all quarterly and annual financial information that would be required to be contained in a filing with the Commission on Forms 10-Q and 10-K if the Company were required to file such forms and, with respect to the annual information only, a report thereon by the Company's certified independent accountants and (ii) all current reports that would be required to be filed with the Commission on Form 8-K if the Company were required to file such reports. In addition, whether or not required by the rules and regulations of the Commission, the Company will file a copy of all such information and reports with the Commission for public availability (unless the Commission will not accept such a filing) and make such information available to securities analysts and prospective investors upon request. In addition, the Company and its Restricted Subsidiaries will agree that, for so long as any Notes remain outstanding, they will furnish to the Holders and to securities analysts and prospective investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Act. Events of Default and Remedies The Indenture provides that each of the following constitutes an Event of Default: (i) default for 30 days in the payment when due of interest on, or Liquidated Damages, if any, with respect to, the Notes (whether or not prohibited by the subordination provisions of the Indenture); (ii) default in -55- payment when due (whether payable at maturity, upon redemption or repurchase or otherwise) of the principal of or premium, if any, on the Notes (whether or not prohibited by the subordination provisions of the Indenture); (iii) failure by the Company or any of its Restricted Subsidiaries to comply with the provisions described under the caption "Merger, Consolidation or Sale of Assets"; (iv) failure by the Company to comply with the provisions described under the captions "Change of Control" or "Asset Sale" (whether or not prohibited by the subordination provisions of the Indenture) (other than a failure to purchase notes pursuant to an offer commenced under such provisions, which shall be subject to clause (ii) above) for 30 days after written notice by the Trustee or the Holders of at least 25% in principal amount of the then outstanding Notes; (v) failure by the Company or any of its Restricted Subsidiaries for 60 days after written notice by the Trustee or the Holders of at least 25% in principal amount of the then outstanding Notes to comply with any of its other agreements in the Indenture or the Notes other than those referred to in clauses (i), (ii), (iii) or (iv) above; (vi) default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Company or any of its Significant Subsidiaries (or the payment of which is guaranteed by the Company or any of its Significant Subsidiaries), whether such Indebtedness or guarantee now exists, or is created after the Closing Date, which default (a) is caused by a failure to pay principal after final maturity of such Indebtedness prior to the expiration of the grace period provided in such Indebtedness on the date of such default (a "Payment Default") or (b) results in the acceleration of such Indebtedness prior to its express maturity and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates $10 million or more without such Indebtedness being discharged or such acceleration having been cured, waived or rescinded within 30 days of acceleration; (vii) failure by the Company or any of its Significant Subsidiaries to pay final judgments aggregating in excess of $10 million and either (a) any creditor commences enforcement proceedings upon any such judgment or (b) such judgments are not paid, discharged or stayed for a period of 60 days; (viii) except as permitted by the Indenture, any Guarantee of the Notes by a Significant Subsidiary shall be held in any judicial proceeding to be unenforceable or invalid or shall cease for any reason to be in full force and effect, or any Guarantor which is a Significant Subsidiary or any Person acting on behalf of any such Guarantor, shall deny or disaffirm its obligations under its Guarantee of the Notes; and (ix) certain events of bankruptcy or insolvency with respect to the Company or any of its Significant Subsidiaries. If any Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the then outstanding Notes may declare all the Notes and all other Obligations thereunder to be due and payable immediately. Notwithstanding the foregoing, in the case of an Event of Default arising from certain events of bankruptcy or insolvency, with respect to the Company, all outstanding Notes will become due and payable without further action or notice. Holders of the Notes may not enforce the Indenture or the Notes except as provided in the Indenture. Subject to certain limitations, Holders of a majority in principal amount of the then outstanding Notes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders of the Notes notice of any continuing Default or Event of Default (except a Default or Event of Default relating to the payment of principal, premium, if any, interest or Liquidated Damages, if any) if it determines that withholding notice is in their interest. -56- In the case of any Event of Default occurring by reason of any willful action (or inaction) taken (or not taken) by or on behalf of the Company or any Guarantor with the intention of avoiding payment of the premium that the Company would have had to pay if the Company then had elected to redeem the Notes pursuant to the optional redemption provisions of the Indenture, an equivalent premium shall also become and be immediately due and payable to the extent permitted by law upon the acceleration of the Notes. The Holders of a majority in aggregate principal amount of the Notes then outstanding by notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing Default or Event of Default and its consequences under the Indenture except a continuing Default or Event of Default in the payment of principal, premium, if any, interest or Liquidated Damages, if any, on the Notes. The Company is required to deliver to the Trustee annually a statement regarding compliance with the Indenture, and the Company is required, upon becoming aware of any Default or Event of Default, to deliver to the Trustee a statement specifying such Default or Event of Default. No Personal Liability of Directors, Officers, Employees, Incorporators and Stockholders No director, officer, employee, incorporator or stockholder of the Company or any Guarantor, as such, shall have any liability for any obligations of the Company or such Guarantor under the Notes, the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Such waiver may not be effective to waive liabilities under the federal securities laws and it is the view of the Commission that such a waiver is against public policy. Legal Defeasance and Covenant Defeasance The Company may, at its option and at any time, elect to have all of its obligations discharged with respect to the outstanding Notes ("Legal Defeasance") except for (i) the rights of Holders of outstanding Notes to receive payments in respect of the principal of and premium, if any, interest and Liquidated Damages, if any, on the Notes when such payments are due from the trust referred to below, (ii) the Company's obligations with respect to the Notes concerning issuing temporary Notes, registration of Notes, mutilated, destroyed, lost or stolen Notes and the maintenance of an office or agency for payment and money for security payments held in trust, (iii) the rights, powers, trusts, duties and immunities of the Trustee, and the Company's obligations in connection therewith and (iv) the Legal Defeasance provisions of the Indenture. In addition, the Company may, at its option and at any time, elect to have the obligations of the Company released with respect to certain covenants that are described in the Indenture ("Covenant Defeasance") and thereafter any omission to comply with such obligations shall not constitute a Default or Event of Default with respect to the Notes. In the event Covenant Defeasance occurs, certain events (not including non-payment, bankruptcy, receivership, rehabilitation and insolvency events) described under "Events of Default" will no longer constitute an Event of Default with respect to the Notes. -57- In order to exercise either Legal Defeasance or Covenant Defeasance, (i) the Company must irrevocably deposit with the Trustee, in trust, for the benefit of the Holders of the Notes, cash in U.S. dollars, non-callable Government Securities, or a combination thereof, in such amounts as will be sufficient, in the opinion of a nationally recognized firm of independent public accountants, to pay the principal of and premium, if any, interest and Liquidated Damages, if any, on the outstanding Notes on the Stated Maturity or on the applicable redemption date, as the case may be, and the Company must specify whether the Notes are being defeased to maturity or to a particular redemption date; (ii) in the case of Legal Defeasance, the Company shall have delivered to the Trustee an opinion of counsel in the United States reasonably acceptable to the Trustee confirming that (a) the Company has received from, or there has been published by, the Internal Revenue Service a ruling or (b) since the Closing Date, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such opinion of counsel shall confirm that, the Holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes, as a result of such Legal Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred; (iii) in the case of Covenant Defeasance, the Company shall have delivered to the Trustee an opinion of counsel in the United States reasonably acceptable to the Trustee confirming that the Holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred; (iv) no Default or Event of Default shall have occurred and be continuing on the date of such deposit (other than a Default or Event of Default resulting from the borrowing of funds to be applied to such deposit); (v) such Legal Defeasance or Covenant Defeasance will not result in a breach or violation of, or constitute a default under, any material agreement or instrument (other than the Indenture) to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound; (vi) the Company shall have delivered to the Trustee an opinion of counsel to the effect that after the 91st day following the deposit, the trust fund will not be subject to the effect of any applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors' rights generally; (vii) the Company must deliver to the Trustee an Officers' Certificate stating that the deposit was not made by the Company with the intent of preferring the Holders of Notes over the other creditors of the Company with the intent of defeating, hindering, delaying or defrauding creditors of the Company or others; and (viii) the Company must deliver to the Trustee an Officers' Certificate and an opinion of counsel, each stating that all conditions precedent provided for relating to the Legal Defeasance or the Covenant Defeasance have been complied with. Satisfaction and Discharge of the Indenture The obligations of the Company and the other Guarantors under the Indenture will terminate when (i) either (a) all outstanding Notes have been delivered to the Trustee for cancellation, or (b) all such Notes not theretofore delivered to the Trustee for cancellation have become due and payable, will become due and payable within one year or are to be called for redemption within one year under irrevocable arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name and at the expense of the Company and the Company has irrevocably deposited or caused to be deposited with the Trustee, in trust, funds in an amount sufficient to pay and discharge the entire indebtedness on the Notes not theretofore delivered to the Trustee for cancellation, for principal of (and premium, if any, on) and interest and Liquidated Damages, if any, to the date of maturity -58- or date of redemption, (ii) the Company has paid or caused to be paid all sums payable by the Company under the Indenture, and (iii) the Company has delivered an Officers' Certificate and an Opinion of Counsel relating to compliance with the conditions set forth in the Indenture. Transfer and Exchange A Holder may transfer or exchange Notes in accordance with the Indenture. The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Company may require a Holder to pay any taxes and fees required by law or permitted by the Indenture. The Company is not required to transfer or exchange any Note selected for redemption. Also, the Company is not required to transfer or exchange any Note for a period of 15 days before a selection of Notes to be redeemed. The registered Holder of a Note will be treated as the owner of it for all purposes. Amendment, Supplement and Waiver Except as provided in the next two succeeding paragraphs, the Indenture or the Notes may be amended or supplemented with the consent of the Holders of at least a majority in principal amount of the Notes then outstanding (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Notes), and any existing default or compliance with any provision of the Indenture, or the Notes thereof may be waived with the consent of the Holders of a majority in principal amount of the then outstanding Notes (including consents obtained in connection with a tender offer or exchange offer for Notes). Without the consent of each Holder affected, an amendment or waiver may not (with respect to any Notes held by a non-consenting Holder): (i) reduce the principal amount of Notes whose Holders must consent to an amendment, supplement or waiver; (ii) reduce the principal of or change the fixed maturity of any note or alter the provisions with respect to the price to be paid, or the timing of redemption or payment, upon redemption of the Notes or, after the Company has become obligated to make a Change of Control Offer or an Asset Sale Offer, amend, change or modify the obligation of the Company to make or consummate such Change of Control Offer or Asset Sale Offer; (iii) reduce the rate of or change the time for payment of interest or Liquidated Damages, if any, on any Note; (iv) waive a Default or Event of Default in the payment of principal of or premium, interest or Liquidated Damages, if any, on the Notes (except a rescission of acceleration of the notes by the Holders of at least a majority in aggregate principal amount of the Notes and a waiver of the payment default that resulted from such acceleration); (v) make any Note payable in money other than that stated in the Notes; (vi) except pursuant to the terms of the Indenture, release any Guarantor from its Guarantee of the Notes; (vii) make any change in the subordination provisions in the Indenture that adversely affects the rights of any Holder of any Notes in any material respect or any change to any other provision thereof that adversely affects the rights of any Holder of Notes under the subordination provisions of the Indenture in any material respect (it being understood that amendments to the provisions of the Indenture described above under the caption "Certain Covenants--Incurrence of Indebtedness and Issuance of Preferred Stock" which may have the effect of increasing the amount of Senior Debt that the Company and its Restricted Subsidiaries may incur shall not, for purposes of this clause (vii), be deemed to be a change that adversely affects in a material respect the rights of any Holder of Notes -59- under the subordination provisions of the Indenture); or (viii) make any change in the foregoing amendment and waiver provisions. Notwithstanding the foregoing, without the consent of any Holder of Notes, the Company, the Guarantors and the Trustee may amend or supplement the Indenture, the Notes to cure any ambiguity, defect or inconsistency, to provide for uncertificated Notes in addition to or in place of certificated Notes, to provide for the assumption of the Company's or any Guarantor's obligations to Holders of Notes in the case of a merger, consolidation or sale of assets, to provide security for the Notes, to add a Guarantor, to make any change that would provide any additional rights or benefits to the Holders of Notes or that does not adversely affect the legal rights under the Indenture of any such Holder in any material respect, or to comply with requirements of the Commission in order to effect or maintain the qualification of the Indenture under the Trust Indenture Act. The consent of the Holders of the Notes is not necessary under the Indenture to approve the particular form of any proposed amendment. It is sufficient if such consent approves the substance of the proposed amendment. Concerning the Trustee The Trustee has been appointed by the Company as Registrar and Paying Agent with respect to the Notes. The Indenture contains certain limitations on the rights of the Trustee, should it become a creditor of the Company, to obtain payment of claims in certain cases, or to realize on certain property received in respect of any such claim as security or otherwise. The Trustee will be permitted to engage in other transactions; however, if it acquires any conflicting interest it must eliminate such conflict within 90 days and apply to the Commission for permission to continue or resign. The Holders of a majority in principal amount of the then outstanding Notes will have the right to direct the time, method and place of conducting any proceeding for exercising any remedy available to the Trustee, subject to certain exceptions. The Indenture provides that in case an Event of Default shall occur (which shall not be cured), the Trustee will be required, in the exercise of its power, to use the degree of care of a prudent man in the conduct of his own affairs. Subject to such provisions, the Trustee will be under no obligation to exercise any of its rights or powers under the Indenture at the request of any Holder of Notes, unless such Holder shall have offered to the Trustee security and indemnity satisfactory to the Trustee against any loss, liability or expense. Book-Entry, Delivery and Form Book-Entry The outstanding notes were sold to "qualified institutional buyers" (as defined in Rule 144A under the Securities Act) in reliance on Rule 144A under the Securities Act. The outstanding notes are represented by a note in registered, global form without interest coupons (the "Rule 144A Global Note"). The Rule 144A Global Note was deposited upon issuance with the Trustee as custodian for the Depositary Trust Company ("DTC") and registered in the name of Cede & Co., as nominee of DTC, for credit to the accounts of DTC participants or indirect participants (each as defined below). -60- The new notes will be represented by one or more notes in registered, global form without interest coupons (the "Exchange Global Notes" and, together with the Rule 144A Global Note, the "Global Notes"). The Exchange Global Notes will be deposited on the date of the acceptance for exchange of the outstanding notes and the issuance of the exchange notes with the Trustee as custodian for DTC and registered in the name of Cede & Co. as nominee of DTC, in each case for credit to the accounts of DTC "participants" and "indirect participants" (each as defined below). Except as set forth below, the Global Notes may be transferred, in whole and not in part, only to another nominee of DTC or to a successor of DTC or its nominee. Beneficial interests in the Global Notes may not be exchanged for Notes in certificated form except in the limited circumstances described below. See "--Certificated Certificates." The Exchange Global Notes The descriptions of the operations and procedures of DTC, Euroclear and Clearstream set forth below are provided solely as a matter of convenience. These operations and procedures are solely within the control of the respective settlement systems and are subject to change by them from time to time. Neither the Company nor the initial purchasers take any responsibility for these operations or procedures, and we urge you to contact the relevant system or one of its participants directly to discuss these matters. The Company expects that pursuant to procedures established by DTC (i) upon the issuance of the Exchange Global Notes, DTC or its custodian will credit, on its internal system, the principal amount at maturity of the individual beneficial interests represented by such Exchange Global Notes to the respective accounts of persons who have accounts with such depositary and (ii) ownership of beneficial interests in the Exchange Global Notes will be shown on, and the transfer of such ownership will be effected only through, records maintained by DTC or its nominee (with respect to interests of participants) and the records of participants (with respect to interests of persons other than participants). Ownership of beneficial interests in the Exchange Global Notes will be limited to persons who have accounts with DTC ("participants") or persons who hold interests through participants ("indirect participants"). Holders may hold their interests in the Exchange Global Notes directly through DTC if they are participants in such system, or indirectly through organizations that are participants in such system. So long as DTC, or its nominee, is the registered owner or holder of the Exchange Notes, DTC or such nominee, as the case may be, will be considered the sole owner or holder of the Exchange Notes represented by such Exchange Global Notes for all purposes under the indenture. No beneficial owner of an interest in the Global Notes will be able to transfer that interest except in accordance with DTC's procedures, in addition to those provided for under the indenture with respect to the Notes. Payments of the principal of, premium (if any), interest (including Liquidated Damages) on, the Exchange Global Notes will be made to DTC or its nominee, as the case may be, as the registered owner thereof. Neither the Company, the Trustee or any Paying Agent will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial owner- -61- ship interests in the Exchange Global Notes or for maintaining, supervising or reviewing any records relating to such beneficial ownership interest. The Company expects that DTC or its nominee, upon receipt of any payment of principal, premium, if any, interest (including Liquidated Damages) on the Exchange Global Notes, will credit participants' accounts with payments in amounts proportionate to their respective beneficial interests in the principal amount of the Exchange Global Notes as shown on the records of DTC or its nominee. The Company also expects that payments by participants to owners of beneficial interests in the Exchange Global Notes held through such participants will be governed by standing instructions and customary practice, as is now the case with securities held for the accounts of customers registered in the names of nominees for such customers. Such payments will be the responsibility of such participants. Redemption notices will be sent to DTC. If less than all of the Exchange Notes are to be redeemed, DTC's practice is to determine by lot the amount of the interest of each Participant in issues like the Exchange Notes to be redeemed. Consequently, the Exchange Notes may not be redeemed pro rata from each holder of securities entitlements in the Exchange Notes. The Company expects that transfers between participants in DTC will be effected in the ordinary way through DTC's same-day funds system in accordance with DTC rules and will be settled in same-day funds. Transfers between participants in Euroclear or Clearstream will be effected in the ordinary way in accordance with their respective rules and operating procedures. Because of time zone differences, the securities amount of a Euroclear or Clearstream participant purchasing a security entitlement in a Exchange Global Note from a Participant in DTC will be credited, and any such crediting will be reported to the relevant Euroclear or Clearstream participant, during the securities settlement processing day (which must be a business day for Euroclear and Clearstream) immediately following the settlement date of DTC. Cash received in Euroclear or Clearstream as a result of sales of security entitlements in a Global Security by or through a Euroclear or Clearstream participant to a Participant in DTC will be received with value on the settlement date of DTC but will be available in the relevant Euroclear or Clearstream cash account only as of the business day for Euroclear or Clearstream following DTC's settlement date. If a holder requires physical delivery of a Certificated Security for any reason, including to sell Notes to persons in states which require physical delivery of the Notes, or to pledge such securities, such holder must transfer its interest in a Exchange Global Note, in accordance with the normal procedures of DTC and with the procedures set forth in the indenture. DTC has advised the Company that it will take any action permitted to be taken by a holder of Exchange Notes (including the presentation of Exchange Notes for exchange as described below) only at the direction of one or more participants to whose account the DTC interests in the Exchange Global Notes are credited and only in respect of such portion of the aggregate principal amount of Exchange Notes as to which such participant or participants has or have given such direction. However, if there is an Event of Default under the Indenture, DTC will exchange the Global Notes for Certificated Securities, which it will distribute to its participants and which will be legended as set forth under "Transfer Restrictions." -62- Subject to compliance with the transfer restrictions applicable to the Exchange Notes, cross-market transfers between the Participants in DTC, on the one hand, and Euroclear or Clearstream participants, on the other hand, will be effected through DTC in accordance with DTC's rules on behalf of Euroclear or Clearstream, as the case may be, by its respective depositary; however, such cross-market transactions will require delivery of instructions to Euroclear or Clearstream, as the case may be, by the counterparty in such system in accordance with the rules and procedures and within the established deadlines (Brussels time) of such system. Euroclear or Clearstream, as the case may be, will, if the transaction meets its settlement requirements, deliver instructions to its respective depositary to take action to effect final settlement on its behalf by delivering or receiving security entitlements in the relevant Exchange Global Notes in DTC, and making or receiving payment in accordance with normal procedures for same-day funds settlement applicable to DTC. Euroclear participants and Clearstream participants may not deliver instructions directly to the depositories for Euroclear or Clearstream. DTC has advised the Company as follows: DTC is a limited purpose trust company organized under the laws of the State of New York, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the Uniform Commercial Code and a "Clearing Agency" registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). DTC was created to hold securities for its participants and facilitate the clearance and settlement of securities transactions between participants through electronic book-entry changes in accounts of its participants, thereby eliminating the need for physical movement of certificates. Participants include securities brokers and dealers, banks, trust companies and clearing corporations and certain other organizations, including Euroclear and Clearstream. Indirect access to the DTC system is available to others such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a participant, either directly or indirectly ("indirect participants"). Although DTC, Euroclear and Clearstream have agreed to the foregoing procedures in order to facilitate transfers of interests in the Global Note among participants of DTC, Euroclear and Clearstream, they are under no obligation to perform such procedures, and such procedures may be discontinued at any time. Neither the Company nor the Trustee will have any responsibility for the performance by DTC, Euroclear and Clearstream or their respective participants or indirect participants of their respective obligations under the rules and procedures governing their operations. Certificated Securities Certificated Securities shall be issued in exchange for beneficial interests in the Exchange Global Notes (i) if requested by a holder of such interests, (ii) the Company, at its option, notifies the trustee in writing that it elects to cause the issuance of Certificated Exchange Notes under the indenture or (iii) if DTC is at any time unwilling or unable to continue as a depositary for the Exchange Global Notes and a successor depositary is not appointed by the Company within 90 days. Neither the Company nor the trustee shall be liable for any delay by DTC or any Participant or Indirect Participant in identifying the owners of security entitlements in the related Exchange Notes and the Company and the trustee may conclusively rely on, and shall be protected in relying on, instructions from DTC for all purposes (including with respect to the registration and delivery, and the respective principal amounts, of the Exchange Notes to be issued). -63- Transfer Agent, Registrar, Paying Agent and Exchange Agent The Trustee acts as the transfer agent, registrar, paying agent and exchange agent for the Notes. The Trustee, in its capacity as the paying agent, may appoint co-paying agents, which must be acceptable to the Company. Registration of transfers or exchanges of the Notes are effected without charge by or on behalf of the Company, but any holder transferring any interest in a note is required to pay to the trustee or the Company, as appropriate, any tax or other governmental charges that may be imposed in connection with that transfer or exchange. The Company is not required to register or cause to be registered the transfer of any note after it has been called for redemption. Certain Definitions Set forth below are certain defined terms used in the Indenture. Reference is made to the Indenture for a full disclosure of all such terms, as well as any other capitalized terms used herein for which no definition is provided. "Acquired Debt" means, with respect to any specified Person, (i) Indebtedness or preferred stock of any other Person existing at the time such other Person is merged with or into or became a Subsidiary of such specified Person, including, without limitation, Indebtedness or preferred stock incurred in connection with, or in contemplation of, such other Person merging with or into or becoming a Subsidiary of such specified Person and (ii) Indebtedness secured by a Lien encumbering any asset acquired by such specified Person. "Affiliate" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, "control" (including, with correlative meanings, the terms "controlling," "controlled by" and "under common control with"), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise. "Asset Sale" means (i) the sale, lease, conveyance or other disposition (collectively, "dispositions") of any assets or rights (including, without limitation, by way of a Sale and Leaseback Transaction), other than dispositions of inventory or sales or leases of real estate constituting Real Estate Held for Sale in the ordinary course of business, and (ii) the issuance of Equity Interests by any Restricted Subsidiary or the disposition by the Company or a Restricted Subsidiary of Equity Interests in any of the Company's Restricted Subsidiaries (other than directors' qualifying shares or shares required by applicable law to be held by a Person other than the Company or a Restricted Subsidiary of the Company), in the case of either clause (i) or (ii), whether in a single transaction or a series of related transactions (a) that have a fair market value in excess of $3.0 million or (b) for net proceeds in excess of $3.0 million. Notwithstanding the foregoing, the following will be deemed not to be Asset Sales: (i) a transfer of assets by the Company to a Restricted Subsidiary or by a Restricted Subsidiary to the Company or to another Restricted Subsidiary; (ii) an issuance of Equity Interests by a Restricted Subsidiary to the Company or to another Restricted Subsidiary; (iii) a Permitted Investment or Restricted Payment that is permitted by the covenant described above under the caption "Restricted -64- Payment"; (iv) a disposition of Cash Equivalents solely for cash or other Cash Equivalents; (v) a disposition in the ordinary course of business of used, worn-out, obsolete, damaged or replaced equipment; (vi) the grant of licenses to third parties in respect of intellectual property in the ordinary course of business of the Company or any of its Restricted Subsidiaries, as applicable; (vii) any disposition of properties or assets that is governed by the provisions described under "Change of Control" or "Merger, Consolidation or Sale of Asset"; and (viii) the granting or incurrence of any Permitted Lien. "Board Resolution" means a duly adopted resolution of the Board of Directors of the Company in full force and effect at the time of determination and certified as such by the Secretary or an Assistant Secretary of the Company and delivered to the Trustee. "Capital Lease Obligation" means, at the time any determination thereof is to be made, the amount of the liability in respect of a capital lease that would at such time be required to be capitalized on a balance sheet in accordance with GAAP. "Capital Stock" means (i) in the case of a corporation, corporate stock, (ii) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock, (iii) in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited) and (iv) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person. "Cash Equivalents" means (a) marketable obligations issued or unconditionally guaranteed by the U.S. or issued by any of its agencies and backed by the full faith and credit of the U.S., in each case maturing within one year from the date of acquisition; (b) short-term investment grade domestic and eurodollar certificates of deposit or time deposits that are fully insured by the Federal Deposit Insurance Corporation or are issued by commercial banks organized under the laws of the U.S. or any of its states having combined capital, surplus, and undivided profits of not less than $100,000,000 (as shown on its most recently published statement of condition); (c) commercial paper and similar obligations rated "P-1" by Moody's Investors Service, Inc. ("Moody's") or "A-1" by Standard & Poor's Rating Services, a division of The McGraw-Hill Companies, Inc. ("S & P"); (d) readily marketable tax-free municipal bonds of domestic issuer rated "A-2" or better by Moody's or "A" or better by S&P, and maturing within one year from the date of issuance; and (e) mutual funds or money market accounts investing primarily in items described in clauses (a) through (d) above. "Change of Control" means, with respect to the Company or any successor Person permitted under the covenant "Merger, Consolidation or Sale of Assets," the occurrence of any of the following: (a) any "person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), other than Apollo and its Affiliates, acquires "beneficial ownership" (as determined in accordance with Rule 13d-3 under the Exchange Act), directly or indirectly, of more than 50% of the total outstanding shares of Voting Stock (as defined) except to the extent that, and so long as, Apollo and its affiliates hold the right, by voting power, contract or otherwise, to elect or designate, and do so elect or designate, a majority of the Company's Board of Directors; (b) the Company consolidates with or merges into any other corporation, or conveys, transfers or leases all or substantially all of its assets to any person, or any other corporation merges into the Company and, in the case of any such transaction, the outstanding common stock of the Company is changed or exchanged as a result, unless the -65- shareholders of the Company immediately before such transaction own, directly or indirectly, at least 51% of the outstanding shares of Voting Stock of the corporation resulting from such transaction in substantially the same proportion as their ownership of the Voting Stock immediately before such transaction (except to the extent that, and so long as, Apollo and its affiliates hold the right, by voting power or otherwise, to elect or designate, and do so elect or designate, a majority of the Board of Directors of the corporation resulting from such transaction); or (c) the first day on which more than a majority of the members of the Board of Directors of the Company are not Continuing Directors. "Closing Date" means the date of the closing of the sale of the notes initially issued pursuant to the Indenture. "Consolidated EBITDA" means, with respect to any Person for any period, the Consolidated Net Income of such Person for such period plus, to the extent deducted in computing such Consolidated Net Income, (i) an amount equal to any extraordinary loss plus any net loss realized in connection with an Asset Sale, (ii) provision for taxes based on income or profits of such Person and its Restricted Subsidiaries for such period, (iii) Consolidated Interest Expense, and (iv) depreciation and amortization (including amortization of goodwill and other intangibles but excluding amortization of prepaid cash expenses that were paid in a prior period) and other non-cash expenses (excluding any such non-cash expense to the extent that it represents an accrual of or reserve for cash expenses in any future period or amortization of a prepaid cash expense that was paid in a prior period) of such Person and its Restricted Subsidiaries for such period to the extent that such depreciation, amortization and other non-cash expenses were deducted in computing such Consolidated Net Income, minus (v) non-cash items increasing such Consolidated Net Income, in each case, for such period without duplication on a consolidated basis and determined in accordance with GAAP. "Consolidated Interest Coverage Ratio" means with respect to any Person for any period, the ratio of the Consolidated Resort EBITDA of such Person for such period to the Consolidated Interest Expense of such Person and its Restricted Subsidiaries for such period. In the event that the Company or any of its Restricted Subsidiaries incurs, assumes, Guarantees, redeems, repays or otherwise retires any Indebtedness (other than revolving credit borrowings) subsequent to the commencement of the period for which the Consolidated Interest Coverage Ratio is being calculated but prior to the date on which the event for which the calculation of the Consolidated Interest Coverage Ratio is made (the "Calculation Date"), then the Consolidated Interest Coverage Ratio shall be calculated giving pro forma effect to such incurrence, assumption, Guarantee, redemption, repayment or retirement of Indebtedness as if the same had occurred at the beginning of the applicable four-quarter reference period. In addition, for purposes of making the computation referred to above, (i)(a) acquisitions that have been made by the Company or any of its Restricted Subsidiaries, including through mergers or consolidations and including any related financing transactions and (b) other transactions consummated by the Company or any of its Restricted Subsidiaries with respect to which pro forma effect may be given pursuant to Article 11 of Regulation S-X under the Securities Act, in each case during the four-quarter reference period or subsequent to such reference period and on or prior to the Calculation Date shall be deemed to have occurred on the first day of the four-quarter reference period and Consolidated Resort EBITDA for such reference period shall be calculated without giving effect to clause (iii) of the proviso set forth in the definition of Consolidated Net Income, (ii) the Consolidated Resort EBITDA attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses disposed of prior to the Calculation Date, shall be excluded and (iii) the Con- -66- solidated Interest Expense attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses disposed of prior to the Calculation Date, shall be excluded, but only to the extent (x) that the obligations giving rise to such Consolidated Interest Expense will not be obligations of the referent Person or any of its Restricted Subsidiaries following the Calculation Date, or (without duplication) (y) such Consolidated Interest Expense is less than the Consolidated Resort EBITDA attributable to such discontinued operations for the same period. "Consolidated Interest Expense" means with respect to any Person for any period the sum, without duplication, of (i) the consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued (including, without limitation, amortization of debt issuance costs and original issue discount, non-cash interest payments, the interest component of any deferred payment obligations, the interest component of all payments associated with Capital Lease Obligations, commissions, discounts and other fees and charges incurred in respect of letter of credit or bankers' acceptance financings, and net payments (if any) pursuant to Hedging Obligations), (ii) the consolidated interest expense of such Person and its Restricted Subsidiaries that was capitalized during such period, (iii) any interest expense for such period on Indebtedness of another Person that is guaranteed by such Person or one of its Restricted Subsidiaries or secured by a Lien on assets of such Person or one of its Restricted Subsidiaries (whether or not such Guarantee or Lien is called upon), in each case, on a consolidated basis and in accordance with GAAP, and (iv) any Preferred Stock dividends paid in cash by the Company or any of its Restricted Subsidiaries to a Person other than the Company or any of its Restricted Subsidiaries, determined, in each case, on a consolidated basis and in accordance with GAAP. "Consolidated Net Income" means, with respect to any Person for any period, the aggregate of the Net Income of such Person and its Restricted Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP; provided that (i) the net income (but not loss) of any Person that is not a Restricted Subsidiary of such Person or that is accounted for by the equity method of accounting shall be included only to the extent of the amount of dividends or distributions paid in cash by such Person during such period to the referent Person or a Restricted Subsidiary thereof, (ii) the net income (but not loss) of any Restricted Subsidiary shall be excluded to the extent that the declaration or payment of dividends or similar distributions by that Restricted Subsidiary of that net income is not at the date of determination permitted by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary or its stockholders, (iii) the Net Income of any Person acquired in a pooling of interests transaction for any period prior to the date of such acquisition shall be excluded, and (iv) the cumulative effect of a change in accounting principles shall be excluded. "Consolidated Net Worth" means, with respect to any Person as of any date, the consolidated stockholders' equity of such Person and its consolidated Restricted Subsidiaries as of such date, less (without duplication) amounts attributable to Disqualified Stock of such Person, in each case determined in accordance with GAAP. "Consolidated Resort EBITDA" means, with respect to any Person for any period, the Consolidated EBITDA of such Person for such period minus consolidated real estate revenue of such Person and its Restricted Subsidiaries for such period plus consolidated real estate operating expenses of such Person and its Restricted Subsidiaries for such period minus any portion of such Consolidated -67- EBITDA attributable to Unrestricted Subsidiaries of such Person for such period, in each case as reported on such Person's consolidated statement of operations and determined on a consolidated basis and in accordance with GAAP. "Continuing Directors" means, as of any date of determination, any member of the Board of Directors of the Company who (i) was a member of such Board of Directors on May 11, 1999 or (ii) was nominated for election or elected to such Board of Directors with the approval of a majority of the Continuing Directors who were members of such Board at the time of such nomination or election. "Credit Agreement" means that certain Second Amended and Restated Credit Agreement, dated as of November 13, 2001, by and among The Vail Corporation, the Lenders named therein, Bank of America, N.A., as Agent, and Banc of America Securities LLC, including any related notes, guarantees, collateral documents, instruments and agreements executed in connection therewith, and in each case, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time. "Default" means any event that is or with the passage of time or the giving of notice or both would be an Event of Default. "Disqualified Stock" means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable at the option of the holder), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the holder thereof, in whole or in part, on or prior to the date that is 91 days after the date on which the Notes mature; provided, however, that any Capital Stock that would not constitute Disqualified Stock but for provisions thereof giving holders thereof the right to require such Person to purchase or redeem such Capital Stock upon the occurrence of an "asset sale" or "change of control" occurring on or prior to 91 days after the date on which the Notes mature shall not constitute Disqualified Stock if (1) the "asset sale" or "change of control" provisions applicable to such Capital Stock are not more favorable in any respect to the holders of such Capital Stock than the terms applicable to the Notes and described under the captions "Repurchase at the Option of Holders--Asset Sales" and "Repurchase at the Option of Holders--Change of Control"; and (2) any such requirement only becomes operative after compliance with such terms applicable to the Notes, including the purchase of any Notes tendered pursuant thereto. "Equity Interests" means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock). "Equity Offering" means (1) a public or private sale of Capital Stock of the Company and (ii) the sale of other securities convertible or exchangeable into Capital Stock (other than Disqualified Stock) of the Company; provided, an Equity Offering shall be deemed to occur with respect to all or a portion of such securities only upon the conversion or exchange of such securities into Capital Stock. -68- "Existing Indebtedness" means Indebtedness of the Company and the Company's Subsidiaries (other than Indebtedness under the Credit Agreement and the Existing Notes) in existence on May 11, 1999. "Existing Note Indenture" means the Indenture dated as of May 11, 1999 among the Company, the trustee named therein and the guarantors named therein relating to the Existing Notes, as supplemented on or before the Closing Date. "Existing Notes" means the $200.0 million aggregate principal amount of 8 3/4% Senior Subordinated Notes due 2009 issued by the Company under the Existing Note Indenture and outstanding on the Closing Date. "GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession, which are in effect in the United States from time to time. "Guarantee" means a guarantee (other than by endorsement of negotiable instruments for collection in the ordinary course of business), direct or indirect, in any manner (including, without limitation, letters of credit and reimbursement agreements in respect thereof), of all or any part of any Indebtedness. "Guarantor" means (i) each of the Company's Restricted Subsidiaries that is a party to the Indenture on the date of execution and delivery of the Indenture and (ii) each other Person that becomes a guarantor of the obligations of the Company under the Notes and the Indenture from time to time in accordance with the provisions of the Indenture described under the caption "Certain Covenants--Additional Subsidiary Guarantees," and their respective successors and assigns; provided, however, that "Guarantor" shall not include any Person that is released from its Guarantee of the obligations of the Company under the Notes and the Indenture as described under "Subsidiary Guarantees." "Hedging Obligations" means, with respect to any Person, the obligations of such Person under (i) currency exchange or interest rate swap, cap or collar agreements and (ii) other agreements or arrangements designed to protect such Person against fluctuations in currency exchange or interest rates. "Indebtedness" means, with respect to any Person, without duplication, (i) any indebtedness of such Person, whether or not contingent, in respect of borrowed money or evidenced by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof) or bankers' acceptances or representing Capital Lease Obligations or the balance deferred and unpaid of the purchase price of any property (which purchase price is due more than one year after taking title to such property) or services or representing any Hedging Obligations, except any such balance that constitutes an accrued expense or trade payable, if and to the extent any of the foregoing indebtedness (other than letters of credit and Hedging Obligations) would appear as a liability upon a balance sheet of such Person prepared in accordance with GAAP; (ii) all indebtedness of others se- -69- cured by a Lien on any asset of such Person (whether or not such indebtedness is assumed by such Person the amount of such obligation, to the extent it is without recourse to such Person, being deemed to be the lesser of the value of such property or assets or the amount of the obligation so secured); (iii) to the extent not otherwise included, the Guarantee by such Person of any Indebtedness of any other Person; provided, however, that (1) the amount outstanding at any time of any Indebtedness issued with original issue discount is the face amount of such indebtedness less the remaining unamortized portion of the original issue discount of such Indebtedness at such time as determined in conformity with GAAP; and (2) Indebtedness shall not include any liability for federal, state, local or other taxes; and (iv) with respect to any Restricted Subsidiary of the Company, Preferred Stock of such Person (in an amount equal to the greater of (x) the sum of all obligations of such Person with respect to redemption, repayment or repurchase thereof and (y) the book value of such Preferred Stock as reflected on the most recent financial statements of such Person). "Investments" means, with respect to any Person, all investments by such Person in other Persons (including Affiliates) in the forms of direct or indirect loans (including guarantees of Indebtedness or other obligations), advances or capital contributions (excluding commission, travel and similar advances to officers and employees made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities, together with all items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP, excluding, however, trade accounts receivable and bank deposits made in the ordinary course of business consistent with past practice. If the Company or any Restricted Subsidiary of the Company sells or otherwise disposes of any Equity Interests of any direct or indirect Restricted Subsidiary of the Company such that, after giving effect to any such sale or disposition, such Person is no longer a Restricted Subsidiary of the Company shall be deemed to have made an Investment on the date of any such sale or disposition equal to the fair market value of the Equity Interests of such Restricted Subsidiary not sold or disposed of in an amount determined as provided in the penultimate paragraph of the covenant described above under the caption "Restricted Payments." "Lien" means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law (including any conditional, sale or other title retention agreement, any lease in the nature thereof, and any option or other agreement to sell or give a Lien). "Make-Whole Amount" means, with respect to any note, an amount equal to the excess, if any, of (a) the present value of the remaining principal, premium, if any, and interest (other than accrued interest otherwise payable upon redemption) payments that would be payable with respect to such note if such note were redeemed on May 15, 2004, computed using a discount rate equal to the Treasury Rate plus 50 basis points, over (b) the principal amount of such note. "Make-Whole Average Life" means, with respect to any date of redemption of Notes, the number of years (calculated to the nearest one-twelfth) from such redemption date to May 15, 2004. "Make-Whole Price" means, with respect to any Note, the greater of (a) the sum of the principal amount of and Make-Whole Amount with respect to such Note, and (b) the redemption price of such note on May 15, 2004. -70- "Net Income" means, with respect to any Person, the net income (or loss) of such Person, determined in accordance with GAAP and before any reduction in respect of Preferred Stock dividends, excluding, however, (i) any gain (or loss), together with any related provision for taxes on such gain (or loss), realized in connection with (a) any Asset Sale (including, without limitation, dispositions pursuant to Sale and Leaseback Transactions) or (b) the disposition of any securities by such Person or any of its Subsidiaries or the extinguishment of any Indebtedness of such Person or any of its Subsidiaries and (ii) any extraordinary or nonrecurring gain (or loss), together with any related provision for taxes on such extraordinary or nonrecurring gain (or loss). "Net Proceeds" means the aggregate cash proceeds or Cash Equivalents proceeds received by the Company or any of its Restricted Subsidiaries in respect of any Asset Sale (including, without limitation, any cash received upon the sale or other disposition of any non-cash consideration received in any Asset Sale, but only as and when received, and any proceeds deemed to be cash or Cash Equivalents pursuant to clause (b) of the first paragraph under the caption "Asset Sales"), net of (i) the direct costs relating to such Asset Sale (including, without limitation, legal, accounting and investment banking fees, and sales commissions) and any relocation expenses incurred as a result thereof, (ii) taxes paid or payable as a result thereof (after taking into account any available tax credits or deductions and any tax sharing arrangements), (iii) amounts required to be applied to the repayment of Indebtedness secured by a Lien on the asset or assets that were the subject of such Asset Sale, (iv) all distributions and other payments required to be made to minority interest holders of a Restricted Subsidiary or joint venture as a result of such Asset Sale, and (v) any reserve for adjustment in respect of the sale price of such asset or assets established in accordance with GAAP. "Obligations" means any principal, interest (including post-petition interest), penalties, fees, indemnifications, reimbursements, damages and other liabilities payable under the documentation governing any Indebtedness. "Permitted Holder" means Apollo Advisors, L.P., a Delaware limited partnership, or any fund, investment vehicle or account managed, advised or controlled by Apollo Advisors, L.P., or any of its Affiliates. "Permitted Investments" means (i) any Investment in the Company or a Restricted Subsidiary of the Company; (ii) any Investment in Cash Equivalents; (iii) any Investment by the Company or any Restricted Subsidiary of the Company in a Person, if as a result of such Investment (a) such Person becomes a Restricted Subsidiary of the Company and, to the extent required under the Indenture, a Guarantor or (b) such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, the Company or a Restricted Subsidiary of the Company; (iv) any Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in compliance with the covenant described above under the caption "Repurchase at the Option of Holders--Asset Sales"; (v) any acquisition of assets received solely in exchange for the issuance of Equity Interests (other than Disqualified Stock) of the Company; (vi) any Investment in a Similar Business (including any Investment made in any Unrestricted Subsidiaries in a Similar Business) if, after giving effect to such Investment, the aggregate amount of all Investments made after May 11, 1999 pursuant to this clause (vi) then constituting Unrestricted Investments Outstanding does not exceed the greater of (x) $75 million and (y) 7.5% of Total Consolidated Assets of the Company at the time of such Investment; (vii) contributions of Real -71- Estate Held for Sale to Real Estate Joint Ventures; provided, in the case of any Investment made pursuant to this clause (vii) or the preceding clause (vi), that after giving effect to such Investment (a) no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof, and (b) the Company would, at the time of such Investment and after giving pro forma effect thereto as if such Investment had been made at the beginning of the applicable four-quarter period, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the Consolidated Interest Coverage Ratio test set forth in the first paragraph of the covenant described under the caption "Incurrence of Indebtedness and Issuance of Preferred Stock"; and (viii) Investments received in connection with the settlement of any ordinary course obligations owed to the Company or any of its Restricted Subsidiaries. "Permitted Liens" means (i) Liens in favor of the Company or any of its Restricted Subsidiaries; (ii) Liens securing Senior Debt of the Company or any Restricted Subsidiary of the Company; (iii) Liens on property or Equity Interests of a Person existing at the time such Person is merged into or consolidated with the Company or any Restricted Subsidiary of the Company; provided that such Liens were in existence prior to the contemplation of such merger or consolidation and do not extend to any assets or Equity Interests other than those of the Person merged into or consolidated with the Company; (iv) Liens on property existing at the time of acquisition thereof by the Company or any Restricted Subsidiary of the Company; provided that such Liens were in existence prior to the contemplation of such acquisition; (v) Liens incurred or pledges and deposits made in connection with worker's compensation, unemployment insurance and other social security benefits, statutory obligations, bid, surety or appeal bonds, performance bonds or other obligations of a like nature incurred in the ordinary course of business (other than contracts in respect of borrowed money and other Indebtedness); (vi) Liens existing on May 11, 1999; (vii) Liens for taxes, assessments or governmental charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings promptly instituted and diligently concluded; provided that any reserve or other appropriate provision as shall be required in conformity with GAAP shall have been made therefore; (viii) Liens securing the Notes or any Guarantee thereof; (ix) Liens securing Permitted Refinancing Indebtedness to the extent that the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded was permitted to be secured by a Lien; provided that such Liens do not extend to any assets other than those that secured the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded; (x) Liens incurred in the ordinary course of business of the Company or any Restricted Subsidiary of the Company with respect to obligations that do not exceed $5.0 million at any one time outstanding and that (a) are not incurred in connection with the borrowing of money or the obtaining of advances or credit (other than trade credit in the ordinary course of business) and (b) do not in the aggregate materially detract from the value of the property or materially impair the use thereof in the operation of business by the Company or such Restricted Subsidiary; (xi) Liens securing Capital Lease Obligations; provided that such Liens do not extend to any property or assets which are not leased property subject to such Capitalized Lease Obligation; (xii) judgment liens not giving rise to an Event of Default so long as such Lien is adequately bonded and any appropriate legal proceedings that may have been duly initiated for the review of such judgment, degree or order shall not have been finally terminated or the period within such proceedings may be initiated shall not have expired; (xiii) Liens securing obligations of the Company under Hedging Obligations; (xiv) purchase money Liens securing Purchase Money Obligations; provided that the related Indebtedness shall not be secured by any property or assets of the Company or any Restricted Subsidiary other than the property or assets so acquired pursuant to such Purchase Money Obligation; (xv) Liens upon specific -72- items of inventory or other goods and proceeds of any Person securing such Person's obligations in respect of bankers' acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods; (xvi) Liens encumbering deposits made to secure obligations arising from statutory, regulatory, contractual, or warranty requirements of the Company or any of its Restricted Subsidiaries, including rights of offset and set-off; (xvii) Liens arising from filing Uniform Commercial Code financing statements regarding leases; provided that such Liens do not extend to any property or assets which are not leased property subject to such leases or subleases; and (xviii) Liens created for the benefit of all of the Notes and/or any Guarantees thereof. "Permitted Refinancing Indebtedness" means any Indebtedness of the Company or any of its Restricted Subsidiaries issued in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund other Indebtedness (other than Hedging Obligations and other than Indebtedness permitted to be incurred pursuant to clause (i), clause (iv) or clause (vii) of the second paragraph under "--Incurrence of Indebtedness and Issuance of Preferred Stock") of the Company or any of its Restricted Subsidiaries; provided that: (i) the principal amount (or accreted value, if applicable) of such Permitted Refinancing Indebtedness does not exceed the principal amount of (or accreted value, if applicable), plus premium and accrued interest on, the Indebtedness so extended, refinanced, renewed, replaced, defeased or refunded (plus the amount of reasonable expenses incurred in connection therewith); (ii) such Permitted Refinancing Indebtedness has a final maturity date equal to or later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded; (iii) if the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded is subordinated in right of payment to the Notes or any Guarantee thereof, such Permitted Refinancing Indebtedness is subordinated in right of payment to the Notes or such Guarantee on terms at least as favorable to the Holders of Notes as those contained in the documentation governing the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded; and (iv) such Indebtedness is incurred either by the Company or by the Restricted Subsidiary that is an obligor on the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded. "Person" means an individual, limited or general partnership, corporation, limited liability company, association, unincorporated organization, trust, joint stock company, joint venture or other entity, or a government or any agency or political subdivisions thereof. "Preferred Stock" of any Person means Capital Stock of such Person of any class or classes (however designated) that ranks prior, as to the payment of dividends or as to the distribution of assets upon any voluntary or involuntary liquidation, dissolution or winding up of such Person, to shares of Capital Stock of any other class of such Person. "Purchase Money Obligations" of any Person means any obligations of such Person or any of its Subsidiaries to any seller or any other person incurred or assumed in connection with the purchase of real or personal property to be used in the business of such person or any of its subsidiaries within 180 days of such purchase. -73- "Real Estate Held for Sale" means, with respect to any Person, the real estate of such Person and its Restricted Subsidiaries classified for financial reporting purposes as Real Estate Held for Sale on May 11, 1999 or thereafter acquired as Real Estate Held for Sale. "Real Estate Joint Venture" means any Person engaged exclusively in the acquisition, development and operation or resale of any real estate asset or group of related real estate assets (and directly related activities). "Restricted Investment" means an Investment other than a Permitted Investment. "Restricted Subsidiary" of a Person means any Subsidiary of the referent Person that is not an Unrestricted Subsidiary. "Sale and Leaseback Transaction" means an arrangement relating to property now owned or hereafter acquired whereby the Company or a Restricted Subsidiary transfers such property to a Person and the Company or a Restricted Subsidiary leases it from such Person. "Significant Subsidiary" means any Restricted Subsidiary that would be a "significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act, as such Regulation was in effect on the date of the Existing Note Indenture. "Similar Business" means any business conducted by the Company or any of its Subsidiaries as of May 11, 1999 or any other recreation, leisure and/or hospitality business including without limitation ski mountain resort operations, or any business or activity that is reasonably similar thereto or a reasonable extension, development or expansion thereof or is reasonably ancillary thereto. "Stated Maturity" means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which such payment of interest or principal was scheduled to be paid in the original documentation governing such Indebtedness, and shall not include any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof. "Subsidiary" means, with respect to any Person, (i) any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of at least a majority of the directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person (or a combination thereof) and (ii) any partnership (a) the sole general partner or the managing general partner of which is such Person or a Subsidiary of such Person or (b) the only general partners of which are such Person or one or more Subsidiaries of such Person (or any combination thereof). "Total Consolidated Assets" means, with respect to any Person as of any date, the book value of the assets of such Person and its Restricted Subsidiaries as shown on the most recent consolidated balance sheet of such Person. "Treasury Rate" means, at any time of computation, the yield to maturity at such time (as compiled by and published in the most recent statistical release (or any successor release) of the Fed- -74- eral Reserve Bank of New York, which has become publicly available at least two business days prior to the date of the redemption notice or, if such statistical release (or successor release) is no longer published, any generally recognized publicly available source of similar market data) of United States Treasury securities with a constant maturity most nearly equal to the Make-Whole Average Life; provided, however, that if the Make-Whole Average Life is not equal to the constant maturity of the United States Treasury security for which a weekly average yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one-twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given, except that if the Make-Whole Average Life is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year shall be used. "Unrestricted Investments Outstanding" means, at any time of determination, in respect of all Permitted Investments made pursuant to clause (vi) of the definition of the term Permitted Investments, the excess, if any, of (i) the sum of all Permitted Investments theretofore made by the Company or any Restricted Subsidiary on or after May 11, 1999 pursuant to clause (vi) of the definition of Permitted Investments over (ii) the amount of all cash, and the fair market value of any assets or property, distributed as dividends and distributions to the Company or a Restricted Subsidiary of the Company (to the extent that the Company does not elect to include the amount of such dividends and distributions in the computation of Consolidated Net Income pursuant to the parenthetical of clause (i) of the definition thereof at the time of determination), and all repayments of the principal amount of loans or advances, the net cash proceeds, and the fair market value of assets or property, received from sales or transfers, in respect of such Investments to the Company or any of its Restricted Subsidiaries and any other reduction made in cash of such Investments in such Person. "Unrestricted Subsidiary" means Boulder/Beaver, LLC, Colter Bay Corporation, Eagle Park Reservoir Company, Forest Ridge Holdings, Inc., Gros Ventre Utility Company, Jackson Lake Lodge Corporation, Jenny Lake Lodge, Inc., Mountain Thunder, Inc., Resort Technology Partners, LLC, RT Partners, Inc., SSI Venture, LLC, Vail Associates Investments, Inc. and VR Holdings, Inc. and any other Subsidiary that is designated by the Board of Directors as an Unrestricted Subsidiary pursuant to a Board Resolution, but only to the extent that such Subsidiary is not party to any agreement, contract, arrangement or understanding with the Company or any Restricted Subsidiary of the Company unless the terms of any such agreement, contract, arrangement or understanding comply with the covenant set forth under "Transactions with Affiliates." "Voting Stock" of any Person as of any date means classes of the Capital Stock of such Person that is at the time entitled to vote in the election of at least a majority of the directors, managers, trustees or other governing body of such Person. "Weighted Average Life to Maturity" means, when applied to any Indebtedness at any date, the number of years obtained by dividing (i) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment, by (ii) the then outstanding principal amount of such Indebtedness. -75- DESCRIPTION OF CERTAIN INDEBTEDNESS New Credit Facility On November 13, 2001, we entered into a revolving Credit Facility (the "Credit Facility") to replace our existing Credit Facility. Our subsidiary, The Vail Corporation, is the borrower under the Credit Facility, with Bank of America, N.A., as agent (the "Agent"), certain other financial institutions, as lenders, and Banc of America Securities LLC. The Credit Facility provides for debt financing up to an aggregate principal amount of $421.0 million. The proceeds of the loans made under the Credit Facility may be used to fund our working capital needs, capital expenditures, permitted investments and other general corporate purposes, including the issuance of letters of credit. Borrowings under the Credit Facility bear interest annually at the borrower's option at the rate of (i) LIBOR (the London interbank offered rate for a given interest period) plus a margin (ranging from 1.50% to 2.50%) or (ii) the Base Rate (defined as the higher of the Federal Funds Rate, as published by the Federal Reserve Bank of New York, plus 0.50%, or the Agent's prime lending rate) plus a margin of up to 0.75%. In addition, the borrower must pay a fee on the face amount of each commercial letter of credit equal to 1/8 of 1.0% of the actual daily available amount under each such letter of credit and for each standby letter of credit the borrower must pay a rate equal to the applicable margin for LIBOR loans times the actual daily amount available to be drawn under such letter of credit. The borrower must also pay a quarterly unused commitment fee ranging from 0.35% to 0.50%. The interest margins and fees described in this paragraph fluctuate based upon the ratio of Funded Debt (as defined) to Adjusted EBITDA (as defined). The Credit Facility terminates on November 13, 2004. The Vail Corporation's obligations under the Credit Facility are guaranteed by us and certain of our subsidiaries. In addition, The Vail Corporation's obligations under the Credit Facility are secured by a pledge of all of the capital stock of The Vail Corporation and substantially all of its subsidiaries. The Credit Facility contains various covenants that limit, among other things, subject to certain exceptions, indebtedness, liens, transactions with affiliates, loans, advances and investments, acquisitions, mergers, and dissolutions, sales of assets, management fees and distributions and certain other business activities. The Credit Facility also contains certain financial covenants, including Funded Debt to Adjusted EBITDA, Senior Debt to EBITDA, a Minimum Fixed Charge Coverage Ratio, an Interest Coverage Ratio and limitations on the types and amounts of Capital Expenditures (each as defined in the Credit Facility). Industrial Revenue Bonds Pursuant to an indenture (the "IRB Indenture") dated as of April 1, 1998, between Eagle County, Colorado, as issuer (the "IRB Issuer"), and U.S. Bank National Association, as trustee (the "IRB Trustee"), $41.2 million aggregate principal amount of industrial revenue bonds (the "IRBs") were issued for the purpose of providing funds to The Vail Corporation d/b/a Vail Associates, Inc. ("VAI") to refinance certain existing industrial revenue bonds. Pursuant to a financing agreement (the "IRB Agreement") dated as of April 1, 1998, among the IRB Issuer and VAI, the IRB Issuer -76- loaned to VAI the proceeds of the issuance of the IRBs and VAI agreed to make payments in the aggregate amount, bearing interest at rates and payable at times, corresponding to the principal amount of, interest rates on and due dates under the IRBs. The obligations of VAI under the IRB Indenture, the IRB Agreement and the IRBs are secured by certain multi-party agreements between VAI, the IRB Trustee and the U.S. Forest Service (the "Permit Agreements") relating to the Vail Mountain and Beaver Creek Mountain Forest Service Permits (the "Permits"). The Permit Agreements provide that the U.S. Forest Service will cooperate with the IRB Trustee in obtaining a new holder of the Permits (acceptable to the U.S. Forest Service in its sole discretion) in the event of a default by VAI with respect to its obligations under the IRBs. However, the Permit Agreements expressly provide that no security interest is created in or collateral assignment made with respect to the Permits. The IRBs mature, subject to prior redemption, on August 1, 2019. The IRBs bear interest at the rate of 6.95% per annum, with interest payable semi-annually on February 1 and August 1. The IRBs are subject to redemption at the option of VAI, at any time and from time to time on or after August 1, 2008, and are subject to mandatory redemption if interest payments on the IRBs lose their tax exempt status. Furthermore, in the event that VAI or one of its affiliates incurs additional indebtedness with (1) senior or superior rights to the Permits or (2) equivalent rights with respect to the Permits above an aggregate principal amount of $250,000,000 (including the unpaid principal amount of the IRBs) the IRBs will bear an interest rate of 7.45% per annum or, under certain limited circumstances, may be subject to mandatory redemption. We also have indebtedness in connection with $22.0 million of outstanding industrial revenue bonds which we assumed in connection with our acquisition of Keystone and Breckenridge. These IRBs consist of two series of refunding bonds which were originally issued to finance the cost of sports and recreational facilities at Keystone. The Series 1990 Sports Facilities Refunding Revenue Bonds have an aggregate outstanding principal amount of $19.0 million. The principal matures in installments in 2006 and 2008. These bonds bear interest at a rate of 7.75% for bonds maturing in 2006 and 7.875% for bonds maturing in 2008. The Series 1991 Sports Facilities Refunding Revenue Bonds have an aggregate outstanding principal amount of $3 million and bear interest at 7.125% for bonds maturing in 2002 and 7.375% for bonds maturing in 2010. SSI Venture Credit Facility SSI Venture has a credit facility that provides debt financing up to an aggregate principal amount of $25 million. The SSI Venture Credit Facility consists of (i) a $15 million Tranche A Revolving Credit Facility and (ii) a $10 million Tranche B Term Loan Facility (of which $7.3 million was outstanding as of October 31, 2001). The SSI Venture Credit Facility matures on the earlier of December 31, 2003 or the termination date of the Credit Facility discussed above. The Vail Corporation guarantees the SSI Venture Credit Facility. Minimum amortization under the Tranche B Term Loan Facility is $1 million in each of fiscal 2002 and 2003 and the outstanding due on the termination date. The SSI Venture Credit Facility bears interest annually at the rates prescribed above for the Credit Facility. SSI Venture also pays a quarterly unused commitment fee at the same rates as the unused commitment fee for the Credit Facility. -77- PLAN OF DISTRIBUTION Each broker-dealer that receives exchange notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of exchange notes received in exchange for outstanding notes where such outstanding notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. We have agreed that for a period of 30 days after effectiveness of the exchange offer registration statement, we will make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with any such resale. We will not receive any proceeds from any sale of exchange notes by broker-dealers. Exchange notes received by broker-dealers for their own account pursuant to the exchange offer may be sold from time to time in one or more transactions in the over-the-counter market, in negotiated transactions, through the writing of options on the exchange notes or a combination of such methods of resale, at market prices prevailing at the time of resale, at prices related to such prevailing market prices or at negotiated prices. Any such resale may be made directly to purchasers or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from any such broker-dealer and/or the purchasers of any such exchange notes. Any broker-dealer that resells exchange notes that were received by it for its own account pursuant to the exchange offer and any broker or dealer that participates in a distribution of such exchange notes may be deemed to be an "underwriter" within the meaning of the Securities Act and any profit of any such resale of exchange notes and any commissions or concessions received by any such persons may be deemed to be underwriting compensation under the Securities Act. The letter of transmittal states that, by acknowledging that it will deliver and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act. By acceptance of the exchange offer, each broker-dealer that receives exchange notes pursuant to the exchange offer hereby agrees to notify us prior to using this prospectus in connection with the sale or transfer of exchange notes, and acknowledges and agrees that, upon receipt of notice from us of the happening of any event which makes any statement in this prospectus untrue in any material respect or which requires the making of any changes in this prospectus in order to make the statements herein not misleading (which notice we agree to deliver promptly to such broker-dealer), such broker-dealer will suspend use of this prospectus until we have amended or supplemented the prospectus to correct such misstatement or omission and have furnished copies of the amended or supplemented prospectus to such broker-dealer. For a period of 30 days after effectiveness of the exchange offer registration statement, we will promptly upon request send additional copies of this prospectus and any amendment or supplement thereto to any broker-dealer that requests such documents in the letter of transmittal. We have agreed to pay all expenses incident to the exchange offer (including the expenses of any one special counsel for the Holders of the Notes) other than commissions or concessions of any brokers or dealers and will indemnify the Holders of the Notes participating in the exchange offer (including any broker-dealers) against certain liabilities, including liabilities under the Securities Act. -78- CERTAIN FEDERAL INCOME TAX CONSIDERATIONS General The following is a discussion of certain U.S. federal income tax and estate tax consequences of the ownership and disposition of the exchange notes by holders who acquired the exchange notes in the exchange offer. For purposes of this discussion, a "U.S. Holder" is a Holder that is for U.S. federal income tax purposes an individual who is a citizen or resident of the United States, a corporation that is organized in or under the laws of the United States or any state thereof, an estate the income of which is includable in gross income for U.S. tax purposes regardless of its source or, a trust (1) the administration of which is subject to the primary supervision of a United States court and as to which one or more United States persons have the authority to control all substantial decisions of the trust or (2) which has made a valid election to be treated as a U.S. person. A "Non-U.S. Holder" is a Holder that for U.S. federal income tax purposes is a non-resident alien or a corporation, estate or trust that is not a U.S. Holder. For United States federal income tax purposes, income earned through a foreign or domestic partnership or similar entity is generally attributed to the entity's owners. This summary applies only to exchange notes held as capital assets within the meaning of Section 1221 of the Internal Revenue Code of 1986, as amended (the "Code"). It does not discuss all of the tax consequences that may be relevant to a holder in light of its particular circumstances or to holders subject to special rules, such as tax-exempt organizations, dealers in securities or foreign currencies, financial institutions, partnerships or other pass-through entities, life insurance companies, or regulated investment companies, or to holders whose functional currency is not the United States dollar or who hold the exchange notes as part of a synthetic security, conversion transaction, or certain "straddle" or hedging transactions. The U.S. federal income tax and estate tax considerations set forth below are based upon the Code and regulations, rulings and judicial decisions thereunder as of the date hereof, and such authorities may be repealed, revoked or modified, possibly with retroactive effect, so as to result in U.S. federal income tax consequences different from those presented below. Exchange Offer. The exchange of outstanding notes for exchange notes will not be a taxable event for federal income tax purposes. A holder will not be recognize any taxable gain or loss as a result of exchanging outstanding notes for exchange notes, and the holder will have the same tax basis and holding period in the exchange notes as he had in the outstanding notes immediately before exchange. U.S. Holders Stated Interest. Stated interest on an exchange note will be taxable to a U.S. Holder as ordinary interest income in accordance with the U.S. Holder's method of accounting for U.S. federal income tax purposes. Original Issue Discount. The outstanding notes were issued with OID for U.S. federal income tax purposes. Because the exchange notes will be treated as a continuation of the U.S. Holder's investment in the outstanding notes, the exchange notes will also be considered as issued with OID. OID is the excess of (i) the stated redemption price at maturity of a note over (ii) its issue price. The -79- amount of OID is deemed to be zero if such excess is less than a de minimis amount (generally 1/4 of 1% of the note's stated redemption price at maturity multiplied by the number of complete years to its maturity from its issue date). The "stated redemption price at maturity" of a note is the sum of all payments provided by the instrument, other than qualified stated interest. The "issue price" of a note is the first price at which a substantial amount of the notes are sold to the public (excluding sales to bond houses, brokers or similar persons or organizations acting in the capacity as underwriters, placement agents or wholesalers). The term "qualified stated interest" generally means stated interest that is unconditionally payable in cash or property (other than debt instruments of the issuer) at least annually at a single fixed rate. The stated interest payable on the exchange notes will be qualified stated interest and the amount of OID on the exchange notes will not be de minimis. Since the exchange notes will be issued with OID in excess of a de minimis amount, a U.S. Holder will be required to include OID in gross income as ordinary interest as it accrues under a constant yield method in advance of receipt of the cash payments attributable to such income, regardless of such U.S. Holder's regular method of accounting. In general, the amount of OID included in income by the holder of a note is the sum of the daily portions of OID for each day during the taxable year (or portion of the taxable year) on which such holder held such note, including the purchase date and excluding the disposition date. The "daily portion" is determined by allocating the OID for an accrual period equally to each day in that accrual period. The "accrual period" for a note may be of any length and may vary in length over the term of a note, provided that each accrual period is no longer than one year and each scheduled payment of principal or interest occurs either on the first or final day of an accrual period. The amount of OID for an accrual period is generally equal to the excess of (i) the product of the note's adjusted issue price at the beginning of such accrual period and its yield to maturity over (ii) the qualified stated interest allocable to such accrual period. The "adjusted issue price" of a note at the beginning of any accrual period is the sum of the issue price of the note plus the amount of OID allocable to all prior accrual periods minus the amount of any prior payments on the note (other than payments of qualified stated interest). Under those rules, a U.S. Holder generally will have to include in income increasingly greater amounts of OID in successive accrual periods. The "yield to maturity" of a note is the discount rate that, when used in computing the present value of all payments to be made on a note, produces an amount equal to the issue price of the note. Sale, Exchange or Redemption of a Note. A U.S. Holder will recognize gain or loss, if any, on the sale, redemption or other taxable disposition of an exchange note in an amount equal to the difference, if any, between the U.S. Holder's adjusted tax basis in the exchange note and the amount received therefor (other than amounts attributable to accrued and unpaid interest on the notes, which will be taxable as ordinary income unless previously included in income). A U.S. Holders adjusted tax basis in a exchange note generally will equal the cost of the outstanding Note which it was exchanged to the U.S. Holder increased by any OID included in income through the date of disposition and decreased by any payments received on the notes (other than payments of qualified stated interest). Subject to the market discount rules noted under "--U.S. Holders--Market Discount and Bond Premium" below, gain or loss, if any, recognized on the sale, redemption or other taxable disposition -80- of a exchange note generally should be long-term capital gain or loss if the exchange note was held as a capital asset and was held for more than one year as of the date of disposition. Market Discount and Acquisition Premium. If a U.S. Holder acquires an note (or purchased an outstanding Note for which the exchange not was exchanged subsequent to its original issuance) and the note's adjusted issue price at the time of purchase exceeds the U.S. Holder's initial tax basis in the note by more than a de minimis amount, the U.S. Holder will be treated as having acquired the note at a "market discount" equal to such excess. In addition, if a U.S. Holder's initial tax basis in a note exceeds the adjusted issue price of the note, the U.S. Holder will generally be treated as having acquired the note with "premium" or "acquisition premium" in an amount equal to such excess. U.S. Holders should consult their tax advisors regarding the existence, if any, and the tax consequences of market discount, premium and acquisition premium. Backup Withholding and Information Reporting. A U.S. Holder of an note may be subject to information reporting and possible backup withholding. If applicable, backup withholding would apply at a rate of 30.5% (30% after December 31, 2001 and subject to periodic reductions through 2006) with respect to interest on (including OID), or the proceeds of a sale, exchange, redemption, retirement, or other disposition of, such exchange note, unless such U.S. Holder (i) is a corporation or comes within certain other exempt categories and, when required, demonstrates this fact, or (ii) provides a taxpayer identification number, certifies as to no loss of exemption from backup withholding, and otherwise complies with applicable backup withholding rules. We will furnish annually to the IRS and to record holders of the notes (to whom it is required to furnish such information) information relating to the amount of OID and interest, as applicable. Non-U.S. Holders The Exchange Notes. The payment of interest (including OID) on an exchange note will generally not be subject to U.S. federal income tax (or to withholding of tax), if (1) the interest and/or OID is not effectively connected with the conduct of a trade or business within the United States or, if a tax treaty applies, the interest is not attributable to a permanent establishment or fixed base in the United States, (2) the Non-U.S. Holder does not actually or constructively own 10% or more of the total combined voting power of all classes of our stock entitled to vote, (3) the Non-U.S. Holder is not a controlled foreign corporation that is related to us actually or constructively through stock ownership and (4) either (i) the beneficial owner of the exchange note certifies to us or our agent, under penalties of perjury, that it is not a U.S. Holder and provides its name and address on U.S. Treasury Form W-8 BEN (or on a suitable substitute form) or (ii) a securities clearing organization, bank or other financial institution that holds customers' securities in the ordinary course of its trade or business (a "financial institution") and holds the exchange note certifies under penalties of perjury that such a Form W-8 BEN (or suitable substitute form) has been received from the beneficial owner or a qualified intermediary by it and furnishes the payer with a copy thereof. A Non-U.S. Holder will generally not be subject to U.S. federal income tax on any gain realized in connection with the sale, exchange, retirement, or other disposition of an exchange note, unless (i) the gain is effectively connected with a trade or business of the Non-U.S. Holder in the United States (or, if a tax treaty applies, the gain is attributable to a permanent establishment or a fixed base -81- in the United States); (ii) in the case of a Non-U.S. Holder who is an individual and holds the exchange note as a capital asset, such holder is present in the United States for 183 or more days in the taxable year of the disposition and either (a) has a "tax home" for United States federal income tax purposes in the United States or (b) has an office or other fixed place of business in the United States to which the gain is attributable; or (iii) the Non-U.S. Holder is subject to tax pursuant to the provisions of United States federal income tax laws applicable to certain United States expatriates. An exchange note held directly by an individual who, at the time of death, is not a citizen or resident of the United States should not be includable in such individual's gross estate for U.S. estate tax purposes as a result of such individual's death if the individual does not actually or constructively own 10% or more of the total combined voting power of all classes of our stock entitled to vote and, at the time of the individual's death, if payments with respect to such exchange note would not have been effectively connected with the conduct by such individual of a trade or business in the United States. Even if the exchange note was includable in the gross estate under the foregoing rules, the exchange note may be excluded under the provisions of an applicable estate tax treaty. Backup Withholding and Information Reporting. We must report annually to the IRS and to each Non-U.S. Holder the amount of interest paid on an exchange note, regardless of whether withholding was required, and any tax withheld with respect to the interest. Under the provisions of an income tax treaty and other applicable agreements, copies of these information returns may be made available to the tax authorities of the country in which the Non-U.S. Holder resides. Interest payments on the exchange notes made by us or any paying agent of ours to Non-U.S. Holders generally will not be subject to "backup withholding" if the certification described under "--Non-U.S. Holders--The Exchange Notes" above is received or an exemption is otherwise established, provided in each case that the payer does not have actual knowledge that the holder is a U.S. Holder. Payment of proceeds from a sale of an exchange note to or through the U.S. office of a broker is subject to information reporting and backup withholding unless the Non-U.S. Holder certifies as to its non-U.S. status or otherwise establishes an exemption from information reporting and backup withholding. Payment outside the United States of the proceeds of the sale of an exchange note to or through a foreign office of a "broker" (as defined in applicable U.S. Treasury Regulations) should not be subject to information reporting or backup withholding, except that if the broker is a U.S. person, a controlled foreign corporation for U.S. federal income tax purposes or a foreign person 50% or more of whose gross income is from a U.S. trade or business, information reporting should apply to such payment unless the broker has documentary evidence in its records that the beneficial owner is not a U.S. Holder and certain other conditions are met or the beneficial owner otherwise establishes an exemption. THE U.S. FEDERAL INCOME TAX AND ESTATE TAX DISCUSSION SET FORTH ABOVE IS INTENDED FOR GENERAL INFORMATION ONLY AND MAY NOT BE APPLICABLE TO A PARTICULAR HOLDER'S SITUATION. PERSONS CONSIDERING A PURCHASE OF THE NOTES SHOULD CONSULT THEIR OWN TAX ADVISORS REGARDING THE PARTICULAR TAX CONSEQUENCES OF PURCHASING, OWNING AND DISPOSING OF THE NOTES, INCLUDING THE TAX CONSEQUENCES UNDER STATE, LOCAL OR FOREIGN -82- LAWS AND OTHER TAX LAWS AND THE POSSIBLE EFFECTS OF CHANGES (POSSIBLY INCLUDING RETROACTIVE CHANGES) IN U.S. FEDERAL AND OTHER TAX LAWS. LEGAL MATTERS Certain legal matters with respect to the exchange notes and the guarantees will be passed upon for us by Cahill Gordon & Reindel, New York, New York and by Martha D. Rehm, Esq., General Counsel to the Company. INDEPENDENT PUBLIC ACCOUNTANTS The consolidated financial statements of Vail Resorts, Inc. and subsidiaries as of July 31, 2001 and 2000, included in our Annual Report on Form 10-K incorporated by reference herein have been audited by Arthur Andersen LLP, independent public accountants, as indicated in their report with respect thereto, which is incorporated by reference in reliance upon the authority of said firm as experts in giving said report. -83- - -------------------------------------------------------------------------------- $160,000,000 VAIL RESORTS, INC. Exchange Offer for $160,000,000 Aggregate Principal Amount of 8 3/4% Senior Subordinated Notes due 2009 -------------- PROSPECTUS -------------- , 2002 - -------------------------------------------------------------------------------- We have not authorized any dealer, salesperson or other person to give any information or represent anything not contained in this prospectus. You must not rely on unauthorized information. This prospectus is not an offer to sell or buy any securities in any jurisdiction where it is unlawful. The information in this prospectus is current as of , 2002. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- PART II INFORMATION NOT REQUIRED IN THE PROSPECTUS ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS. Section 145 of the Delaware General Corporation Law (the "DGCL") makes provision for the indemnification of officers and directors of corporations in terms sufficiently broad to indemnify the officers and directors of the registrant under certain circumstances for liabilities (including reimbursement of expenses incurred) arising under the Securities Act. The Company's Restated Certificate of Incorporation (the "Certificate") provides that to the fullest extent permitted by Delaware law or another applicable law, a director of the Company shall not be liable to the Company or its stockholders for monetary damages for breach of fiduciary duty as a director. Under current Delaware law, liability of a director may not be limited (i) for any breach of the director's duty of loyalty to the Company or its stockholders, (ii) for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law, (iii) in respect of certain unlawful dividend payments or stock redemptions or repurchases and (iv) for any transaction from which the director derives an improper personal benefit. The effect of the provision of the Certificate is to eliminate the rights of the Company and its stockholders (through stockholders' derivative suits on behalf of the Company) to recover monetary damages against a director for breach of the fiduciary duty of care as a director (including breaches resulting from negligent or grossly negligent behavior) except in the situations described in clauses (i) through (iv) above. This provision does not limit or eliminate the rights of the Company or any stockholder to seek nonmonetary relief such as an injunction or rescission in the event of a breach of a director's duty of care. In addition, the Company's Restated Bylaws (the "Bylaws") provide that the Company shall indemnify its directors, officers and employees to the fullest extent permitted by applicable law. The Bylaws provide that the Company may indemnify any person who is or was involved in any manner or is threatened to be made so involved in any threatened, pending or completed investigation, claim, action, suit or proceeding, whether civil, criminal, administrative or investigative (including any action, suit or proceeding by or in the right of the registrant to procure a judgment in its town), by reason of the fact that he is or was or had agreed to become a director, officer or employee of the registrant or is or was or had agreed to become at the request of the board or an officer of the registrant a director, officer or employee of another corporation, partnership, joint venture, trust or other entity against all expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such Proceeding. II-1 ITEM 21. EXHIBITS AND FINANCIAL STATEMENTS INDEX. (a) Exhibits: Exhibit No. Description 3.1 Amended and Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware (Incorporated by reference to Exhibit 3.1 of the Registration Statement of Form S-4 of Gillett Holdings, Inc. (Registration No. 33-52854) including all amendments thereto.) 3.2 Amended and Restated By-Laws (Incorporated by reference to Exhibit 3.2 of the Registration Statement on Form S-4 of Gillett Holdings, Inc. (Registration No. 33-52854) including all amendments thereto.). 4.1* Purchase Agreement, dated as of November 16, 2001 among Vail Resorts, Inc., the guarantors named on Schedule I thereto, and Deutsche Banc Alex. Brown, Banc of America Securities LLC, Bear, Stearns & Co. Inc., CIBC World Markets and Fleet Securities, Inc. 4.2* Indenture, dated as of November 21, 2001 among Vail Resorts, Inc., the guarantors named therein and The Bank of New York, as trustee. 4.3* First Supplemental Indenture, dated as of January 16, 2002, to Indenture dated as of November 21, 2001 among Vail Resorts, Inc., the guarantors named therein and The Bank of New York, as trustee. 4.4* Form of Global Note (included in Exhibit 4.2). 4.5* Registration Rights Agreement, dated as of November 21, 2001 among Vail Resorts, Inc., the guarantors signatory thereto and Deutsche Banc Alex. Brown, Banc of America Securities LLC, Bear, Stearns & Co. Inc., CIBC World Markets and Fleet Securities, Inc. 5.1* Opinion of Cahill Gordon & Reindel as to the legality of the Exchange Notes and the Guarantees of certain of the Guarantors. 5.2* Opinion of General Counsel to the Company as to the legality of the Exchange Notes and the Guarantees of certain of the Guarantors. 12.1* Computation of Ratio of Earnings to Fixed Charges. 23.1* Consent of Arthur Andersen LLP, independent public accountants. 23.2* Consent of Cahill Gordon & Reindel (included in Exhibit 5.1) 23.3 Consent of General Counsel to the Company (included in Exhibit 5.2) 24.1* Power of Attorney (set forth on the signature pages to this Registration Statement). II-2 25.1* Statement regarding eligibility of Trustee on Form T-1. 99.1** Form of Letter of Transmittal. 99.2** Form of Notice of Guaranteed Delivery. - ----------------------------- * Filed Herewith ** To be filed by Amendment ITEM 22. UNDERTAKINGS. The undersigned Registrants hereby undertake that: (a) For purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in this registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (b) To deliver or cause to be delivered with the prospectus, to each person to whom the prospectus is sent or given, the latest annual report to security holders that is incorporated by reference in the prospectus and furnished pursuant to and meeting the requirements of Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of 1934; and, where interim financial information required to be presented by Article 3 of Regulation S-X are not set forth in the prospectus, to deliver, or cause to be delivered to each person to whom the prospectus is sent or given, the latest quarterly report that is specifically incorporated by reference in the prospectus to provide such interim financial information. (c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. (d) To respond to requests for information that is incorporated by reference into the prospectus pursuant to Item 4, 10(b), 11 or 13 of this Form, within one business day of receipt of II-3 such request, and to send the incorporated documents by first class mail or other equally prompt means. This undertaking includes information contained in documents filed subsequent to the effective date of this registration statement through the date of responding to the request. (e) To supply by means of a post-effective amendment all information concerning a transaction and the company being acquired involved therein, that was not the subject of and included in this registration statement when it became effective. II-4 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAIL RESORTS, INC. By: /s/ James P. Donohue ------------------------------------------- Name: James P. Donohue Title: Chief Financial Officer and Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board, Chief Executive January 18, 2002 - --------------------------------------- Officer and Director Adam M. Aron /s/ Andrew P. Daly President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Chief Financial January 18, 2002 - --------------------------------------- Officer James P. Donohue Director - --------------------------------------- Antony P. Ressler /s/ Bruce H. Spector Director January 18, 2002 - --------------------------------------- Bruce H. Spector S-1 /s/ Craig M. Cogut Director January 18, 2002 - --------------------------------------- Craig M. Cogut /s/ Frank Biondi Director January 18, 2002 - --------------------------------------- Frank Biondi Director - --------------------------------------- James S. Tisch /s/ John F. Sorte Director January 18, 2002 - --------------------------------------- John F. Sorte /s/ John J. Ryan III Director January 18, 2002 - --------------------------------------- John J. Ryan III /s/ Joe R. Micheletto Director January 18, 2002 - --------------------------------------- Joe R. Micheletto Director - --------------------------------------- Leon D. Black /s/ Marc J. Rowan Director January 18, 2002 - --------------------------------------- Marc J. Rowan /s/ Robert A. Katz Director January 18, 2002 - --------------------------------------- Robert A. Katz /s/ Stephen C. Hilbert Director January 18, 2002 - --------------------------------------- Stephen C. Hilbert /s/ Thomas H. Lee Director January 18, 2002 - --------------------------------------- Thomas H. Lee /s/ William L. Mack Director January 18, 2002 - --------------------------------------- William L. Mack /s/ William Stiritz Director January 18, 2002 - --------------------------------------- William Stiritz
S-2 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. BEAVER CREEK ASSOCIATES, INC. By: /s/ James P. Donohue ------------------------------------------- Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew P. Daly President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-3 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. BEAVER CREEK CONSULTANTS, INC. By: /s/ James P. Donohue --------------------------------------------- Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew P. Daly President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-4 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. BEAVER CREEK FOOD SERVICES, INC. By: /s/ James P. Donohue -------------------------------------------- Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ John Garnsey Chairman of the Board, President and Director January 18, 2002 - --------------------------------------- John Garnsey /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-5 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. BRECKENRIDGE RESORT PROPERTIES, INC. By: /s/ James P. Donohue ----------------------------------------------- Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ James P. Thompson President and Director January 18, 2002 - --------------------------------------- James P. Thompson /s/ Eric Thompson Director January 18, 2002 - --------------------------------------- Eric Thompson /s/ Alex Iskenderian Director January 18, 2002 - --------------------------------------- Alex Iskenderian /s/ James P. Donohue Senior Vice President January 18, 2002 - --------------------------------------- James P. Donohue S-6 /s/ Martha Dugan Rehm Senior Vice President January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-7 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. COMPLETE TELECOMMUNICATIONS, INC. By: /s/ James P. Donohue ----------------------------------------------- Name: James P. Donohue Title: Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ James P. Donohue Chairman of the Board, Vice President and January 18, 2002 - --------------------------------------- Director James P. Donohue /s/ R. Keith Gwinn President and Director January 18, 2002 - --------------------------------------- R. Keith Gwinn /s/ Nanci N. Northway Vice President and Director January 18, 2002 - --------------------------------------- Nanci N. Northway /s/ Martha Dugan Rehm Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm Director - --------------------------------------- John Uhley
S-8 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. GHTV, INC. By: /s/ James P. Donohue -------------------------------------------- Name: James P. Donohue Title: Chief Financial Officer and Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Andrew P. Daly Chairman of the Board, President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Chief Financial Officer and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm /s/ Adam M. Aron Director January 18, 2002 - --------------------------------------- Adam M. Aron
S-9 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. GILLETT BROADCASTING, INC. By: /s/ James P. Donohue ----------------------------------------- Name: James P. Donohue Title: Chief Financial Officer and Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Andrew P. Daly Chairman of the Board, President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Chief Financial Officer and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm /s/ Adam M. Aron Director January 18, 2002 - --------------------------------------- Adam M. Aron
S-10 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. GRAND TETON LODGE COMPANY By: /s/ James P. Donohue ---------------------------------------- Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew P. Daly President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-11 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. JACKSON HOLE GOLF & TENNIS CLUB, INC. By: /s/ James P. Donohue ---------------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew P. Daly President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-12 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. JHL&S, LLC. By: /s/ James P. Donohue ------------------------------------------ Name: James P. Donohue Title: Chief Financial Officer and Chief Accounting Officer POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Manager January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Clayton James Manager January 18, 2002 - --------------------------------------- Clayton James Manager - --------------------------------------- Joseph Byron Manager - --------------------------------------- Jerry Johnson Manager and Chief Executive Officer for SEC January 18, 2002 /s/ Andrew P. Daly purposes - --------------------------------------- Andrew P. Daly Chief Financial Officer and Chief Accounting January 18, 2002 /s/ James P. Donohue Officer for SEC purposes - --------------------------------------- James P. Donohue Senior Vice President for SEC purposes January 18, 2002 /s/ Martha Dugan Rehm - --------------------------------------- Martha Dugan Rehm
S-13 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. KEYSTONE CONFERENCE SERVICES, INC. By: /s/ James P. Donohue ------------------------------------------ Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Andrew P. Daly Chairman of the Board, President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm /s/ John W. Rutter Senior Vice President and Director January 18, 2002 - --------------------------------------- John W. Rutter
S-14 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. KEYSTONE DEVELOPMENT SALES, INC. By: /s/ James P. Donohue ------------------------------------------- Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew P. Daly President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President January 18, 2002 - --------------------------------------- Martha Dugan Rehm /s/ James P. Thompson Director January 18, 2002 - --------------------------------------- James P. Thompson S-15 /s/ John W. Rutter Senior Vice President and Director January 18, 2002 - --------------------------------------- John W. Rutter
S-16 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. KEYSTONE FOOD & BEVERAGE COMPANY By: /s/ James P. Donohue ------------------------------------------ Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ John W. Rutter Chairman of the Board, President and Director January 18, 2002 - --------------------------------------- John W. Rutter /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-17 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. KEYSTONE RESORT PROPERTY MANAGEMENT, INC. By: /s/ James P. Donohue --------------------------------------------- Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew P. Daly President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President January 18, 2002 - --------------------------------------- James P. Donohue /s/ John W. Rutter Senior Vice President and Director January 18, 2002 - --------------------------------------- John W. Rutter /s/ James P. Thompson Director January 18, 2002 - --------------------------------------- James P. Thompson S-18 /s/ Martha Dugan Rehm Senior Vice President January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-19 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. LARKSPUR RESTAURANT & BAR, LLC By: /s/ James P. Donohue ---------------------------------------------- Name: James P. Donohue Title: Chief Financial Officer and Chief Accounting Officer POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ William Jensen Manager January 18, 2002 - --------------------------------------- William Jensen /s/ Marla Steele Manager January 18, 2002 - --------------------------------------- Marla Steele /s/ Federick Smith Manager January 18, 2002 - --------------------------------------- Federick Smith Manager and President - --------------------------------------- Thomas Salamunovich Manager - --------------------------------------- Kevin Deighan Manager - --------------------------------------- Dave Ferguson /s/ Chris Jarnot Manager January 18, 2002 - --------------------------------------- Chris Jarnot /s/ Andrew P. Daly Chief Executive Officer for SEC Purposes January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Chief Financial Officer and Chief Accounting January 18, 2002 - --------------------------------------- Officer for SEC Purposes James P. Donohue /s/ Martha Dugan Rehm Senior Vice President for SEC Purposes January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-20 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. LODGE PROPERTIES, INC. By: /s/ James P. Donohue ---------------------------------------------- Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew P. Daly President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-21 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. LODGE REALTY, INC. By: /s/ James P. Donohue ------------------------------------------ Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron President and Director January 18, 2002 /s/ James P. Thompson - --------------------------------------- James P. Thompson Senior Vice President and Director January 18, 2002 /s/ James P. Donohue - --------------------------------------- James P. Donohue Senior Vice President and Director January 18, 2002 /s/ Martha Dugan Rehm - --------------------------------------- Martha Dugan Rehm Vice President and Director - --------------------------------------- Victor Charles Viola S-22 Director January 18, 2002 /s/ Andrew P. Daly - --------------------------------------- Andrew P. Daly
S-23 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. PROPERTY MANAGEMENT ACQUISITION CORP., INC. By: /s/ James P. Donohue -------------------------------------------- Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Andrew P. Daly Chairman of the Board President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President, and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-24 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VA RANCHO MIRAGE RESORT, L.P. By: /s/ James P. Donohue -------------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Martha Dugan Rehm General Partner January 18, 2002 - --------------------------------------- VA Rancho Mirage I, Inc. By its Authorized Officer Martha Dugan Rehm /s/ Martha Dugan Rehm Limited Partner January 18, 2002 - --------------------------------------- VA Rancho Mirage II, Inc. By its Authorized Officer Martha Dugan Rehm /s/ Adam M. Aron Chairman and President January 18, 2002 - --------------------------------------- Adam M. Aron S-25 /s/ Andrew P. Daly Director and Senior Vice President January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Director , Senior Vice President and January 18, 2002 - --------------------------------------- Assistant Treasurer James P. Donohue /s/ Martha Dugan Rehm Director and Senior Vice President January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-26 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. ROCKRESORTS CASA MADRONA, LLC By: ROCKRESORTS INTERNATIONAL, LLC By: /s/ James P. Donohue -------------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ James P. Donohue Manager January 18, 2002 - --------------------------------------- Rockresorts International, LLC By: James P. Donohue Senior Vice President /s/ Edward E. Mace President and Chief Executive Officer January 18, 2002 - --------------------------------------- Edward E. Mace /s/ James P. Donohue Senior Vice President January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-27 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. ROCKRESORTS CHEECA, LLC By: ROCKRESORTS INTERNATIONAL, LLC By: /s/ James P. Donohue ---------------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ James P. Donohue Manager January 18, 2002 - --------------------------------------- Rockresorts International, LLC By: James P. Donohue Senior Vice President /s/ Edward E. Mace President and Chief Executive Officer January 18, 2002 - --------------------------------------- Edward E. Mace /s/ James P. Donohue Senior Vice President January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-28 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. ROCKRESORTS EQUINOX, INC. By: /s/ James P. Donohue ----------------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Edward E. Mace President and Chief Executive Officer January 18, 2002 - --------------------------------------- Edward E. Mace /s/ Janice McGill Director January 18, 2002 - --------------------------------------- Janice McGill /s/ John Alexopolous Director January 18, 2002 - --------------------------------------- John Alexopolous /s/ James P. Donohue Senior Vice President January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-29 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. ROCKRESORTS INTERNATIONAL, LLC By: /s/ James P. Donohue --------------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Class "A" Manager January 18, 2002 - --------------------------------------- Adam M. Aron, Chairman /s/ Andrew P. Daly Class "A" Manager January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ Robert Katz Class "A" Manager January 18, 2002 - --------------------------------------- Robert Katz /s/ James P. Donohue Class "A" Manager and Senior Vice President January 18, 2002 - --------------------------------------- James P. Donohue S-30 /s/ Edward Mace Class "A" Manager, Chief Executive Officer January 18, 2002 - --------------------------------------- and President Edward Mace Class "B" Manager - --------------------------------------- David B. Deniger Class "B" Manager - --------------------------------------- Clark W. Hanraltie Class "B" Manager - --------------------------------------- Robert S. Riggs /s/ Martha Dugan Rehm Senior Vice President January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-31 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. ROCKRESORTS LAPOSADA, LLC By: /s/ James P. Donohue ------------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ James P. Donohue Manager January 18, 2002 - --------------------------------------- Rockresorts International, LLC By: James P. Donohue Senior Vice President /s/ Edward E. Mace President and Chief Executive Officer January 18, 2002 - --------------------------------------- Edward E. Mace /s/ James P. Donohue Senior Vice President January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha D. Rehm Senior Vice President January 18, 2002 - --------------------------------------- Martha D.Rehm
S-32 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. ROCKRESORTS LLC By: ROCKRESORTS INTERNATIONAL, LLC By: /s/ James P. Donohue ------------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ James P. Donohue Manager January 18, 2002 - --------------------------------------- Rockresorts International, LLC By: James P. Donohue Senior Vice President /s/ Edward E. Mace President and Chief Executive Officer January 18, 2002 - --------------------------------------- Edward E. Mace /s/ James P. Donohue Senior Vice President January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-33 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. ROCKRESORTS ROSARIO, LLC By: ROCKRESORTS INTERNATIONAL, LLC By: /s/ James P. Donohue ------------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ James P. Donohue Manager January 18, 2002 - --------------------------------------- Rockresorts International, LLC By: James P. Donohue Senior Vice President /s/ Edward E. Mace President and Chief Executive Officer January 18, 2002 - --------------------------------------- Edward E. Mace /s/ James P. Donohue Senior Vice President January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-34 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. TETON HOSPITALITY SERVICES, INC. By: /s/ James P. Donohue ------------------------------------------- Name: James P. Donohue Title: Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew Daly President and Director January 18, 2002 - --------------------------------------- Andrew Daly /s/ James P. Donohue Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-35 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAIL/ARROWHEAD, INC. By: /s/ James P. Donohue ------------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ James P. Thompson President and Director January 18, 2002 - --------------------------------------- James P. Thompson /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm S-36 /s/ Andrew P. Daly Director January 18, 2002 - --------------------------------------- Andrew P. Daly
S-37 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAIL ASSOCIATES CONSULTANTS, INC. By: /s/ James P. Donohue -------------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Andrew P. Daly Chairman of the Board, President and January 18, 2002 - ---------------------------------------- Director Andrew P. Daly /s/ Adam M. Aron Director January 18, 2002 - ---------------------------------------- Adam M. Aron /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - ---------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President January 18, 2002 - ---------------------------------------- Martha Dugan Rehm
S-38 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAIL ASSOCIATES HOLDINGS, LTD. By: /s/ James P. Donohue ----------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ James P. Thompson President and Director January 18, 2002 - --------------------------------------- James P. Thompson /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm S-39 /s/ Andrew P. Daly Director January 18, 2002 - --------------------------------------- Andrew P. Daly
S-40 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAIL ASSOCIATES INVESTMENTS, INC. By: /s/ James P. Donohue ------------------------------------------ Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Andrew P. Daly Chairman of the Board, President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ James P. Thompson Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Thompson /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-41 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAIL ASSOCIATES MANAGEMENT COMPANY By: /s/ James P. Donohue ------------------------------------------ Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ James P. Thompson President and Director January 18, 2002 - --------------------------------------- James P. Thompson /s/ James P. Donohue Senior Vice President January 18, 2002 - --------------------------------------- James P. Donohue /s/ Andrew P. Daly Director January 18, 2002 - --------------------------------------- Andrew P. Daly S-42 /s/ Martha Dugan Rehm Senior Vice President January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-43 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAIL ASSOCIATES REAL ESTATE, INC. By: /s/ James P. Donohue ------------------------------------------ Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ James P. Thompson President and Director January 18, 2002 - --------------------------------------- James P. Thompson /s/ James P. Donohue Senior Vice President January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President January 18, 2002 - --------------------------------------- Martha Dugan Rehm S-44 /s/ Andrew P. Daly Director January 18, 2002 - --------------------------------------- Andrew P. Daly
S-45 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAIL/BATTLE MOUNTAIN, INC. By: /s/ James P. Donohue ----------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Andrew P. Daly Chairman of the Board, President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm /s/ James P. Thompson Vice President and Director January 18, 2002 - --------------------------------------- James P. Thompson
S-46 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAIL/BEAVER CREEK RESORT PROPERTIES, INC. By: /s/ James P. Donohue ---------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew P. Daly President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm S-47 /s/ James P. Thompson Vice President and Director January 18, 2002 - --------------------------------------- James P. Thompson
S-48 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. THE VAIL CORPORATION By: /s/ James P. Donohue ------------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew P. Daly President, Chief Executive Officer and January 18, 2002 - --------------------------------------- Director Andrew P. Daly /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-49 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAIL FOOD SERVICES, INC. By: /s/ James P. Donohue ------------------------------------------ Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ William Jensen Chairman of the Board, President and Director January 18, 2002 - --------------------------------------- William Jensen /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-50 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAIL HOLDINGS, INC. By: /s/ James P. Donohue -------------------------------------------- Name: James P. Donohue Title: Chief Financial Officer and Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly and James P. Donohue each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board, Chief Executive January 18, 2002 - --------------------------------------- Officer and Director Adam M. Aron /s/ Andrew P. Daly President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President, Chief Financial January 18, 2002 - --------------------------------------- Officer and Director James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-51 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAIL RESORTS DEVELOPMENT COMPANY By: /s/ James P. Donohue --------------------------------------------- Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ James P. Thompson Chief Executive Officer, President and January 18, 2002 - --------------------------------------- Director James P. Thompson /s/ James P. Donohue Senior Vice President January 18, 2002 - --------------------------------------- James P. Donohue /s/ Andrew P. Daly Director January 18, 2002 - --------------------------------------- Andrew P. Daly S-52 /s/ Marc J. Rowan Director January 18, 2002 - --------------------------------------- Marc J. Rowan /s/ Robert A. Katz Director January 18, 2002 - --------------------------------------- Robert A. Katz Director - --------------------------------------- James S. Mandel /s/ Martha Dugan Rehm Senior Vice President January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-53 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAIL RR, INC. By: /s/ James P. Donohue ------------------------------------------ Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board President and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew P. Daly Senior Vice President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-54 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAIL SUMMIT RESORTS, INC. By: /s/ James P. Donohue ----------------------------------------- Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew P. Daly President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-55 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAIL TRADEMARKS, INC. By: /s/ James P. Donohue ----------------------------------------------- Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew P. Daly President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-56 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VAMHC, INC. By: /s/ James P. Donohue ------------------------------------------ Name: James P. Donohue Title: Senior Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman of the Board and Director January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew P. Daly President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Director January 18, 2002 - --------------------------------------- James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-57 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VA RANCHO MIRAGE I, INC. By: /s/ James P. Donohue ------------------------------------------ Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman and President January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew P. Daly Senior Vice President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Assistant January 18, 2002 - --------------------------------------- Treasurer and Director James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-58 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. VA RANCHO MIRAGE II, INC. By: /s/ James P. Donohue -------------------------------------- Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Adam M. Aron Chairman and President January 18, 2002 - --------------------------------------- Adam M. Aron /s/ Andrew P. Daly Senior Vice President and Director January 18, 2002 - --------------------------------------- Andrew P. Daly /s/ James P. Donohue Senior Vice President and Assistant January 18, 2002 - --------------------------------------- Treasurer and Director James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-59 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of New York, State of New York, on the 18th day of January, 2002. THE VILLAGE AT BRECKENRIDGE ACQUISITION CORP., INC. By: /s/ James P. Donohue ----------------------------------------------- Name: James P. Donohue Title: Sr. Vice President POWER OF ATTORNEY Each person whose signature appears below hereby constitutes and appoints Andrew P. Daly, James P. Donohue and Martha Dugan Rehm and each acting alone, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments or supplements to this Registration Statement and to file the same with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing necessary or appropriate to be done with this Registration Statement and any amendments or supplements hereto, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ Roger McCarthy President and Director January 18, 2002 - --------------------------------------- Roger McCarthy /s/ James P. Donohue Senior Vice President, Director and January 18, 2002 - --------------------------------------- Assistant Secretary James P. Donohue /s/ Martha Dugan Rehm Senior Vice President and Director January 18, 2002 - --------------------------------------- Martha Dugan Rehm
S-60
                                                                     Exhibit 4.1

                                                                  EXECUTION COPY




                               VAIL RESORTS, INC.

                     GUARANTORS (named in Schedule I hereto)
                                   ----------

                                  $160,000,000

                    8 3/4% Senior Subordinated Notes due 2009

                               PURCHASE AGREEMENT

                                November 16, 2001

                         DEUTSCHE BANC ALEX. BROWN INC.


                         BANC OF AMERICA SECURITIES LLC


                            BEAR, STEARNS & CO. INC.


                            CIBC WORLD MARKETS CORP.


                             FLEET SECURITIES, INC.



                                      -1-



                               VAIL RESORTS, INC.

                                  $160,000,000

                    8 3/4% Senior Subordinated Notes due 2009

                               PURCHASE AGREEMENT

                                                               November 16, 2001
                                                              New York, New York

DEUTSCHE BANC ALEX. BROWN INC.
BANC OF AMERICA SECURITIES LLC
BEAR, STEARNS & CO. INC.
CIBC WORLD MARKETS CORP
FLEET SECURITIES, INC.
         c/o Deutsche Banc Alex. Brown Inc.
         31 West 52nd Street
         New York, New York  10019

Ladies & Gentlemen:

     Vail Resorts, Inc., a Delaware corporation (the "Company"), proposes to
issue and sell to Deutsche Banc Alex. Brown Inc., Banc of America Securities
LLC, Bear, Stearns & Co. Inc., CIBC World Markets Corp. and Fleet Securities,
Inc. (each, an "Initial Purchaser" and, collectively, the "Initial Purchasers")
$160,000,000 in aggregate principal amount of 8 3/4% Senior Subordinated Notes
due 2009 (the "Restricted Notes"), subject to the terms and conditions set forth
herein. The Restricted Notes will be issued pursuant to an indenture (the
"Indenture"), to be dated the Closing Date (as defined), among the Company, the
Guarantors (as defined) and The Bank of New York, as trustee (the "Trustee").
The Notes (as defined) will be fully and unconditionally guaranteed (the
"Guarantees") as to payment of principal, interest, premium and liquidated
damages, if any, on an unsecured senior subordinated basis, jointly and
severally by each entity listed on Schedule I hereto (collectively, the
"Guarantors"). Capitalized terms used herein and not otherwise defined shall
have the meanings assigned to such terms in the Indenture.

     1. Issuance of Securities. The Company proposes, upon the terms and subject
to the conditions set forth herein, to issue and sell to the Initial Purchasers
an aggregate of $160,000,000 in principal amount of Restricted Notes. The
Restricted Notes and the Exchange Notes (as defined) issuable in exchange
therefor are collectively referred to herein as the "Notes."

     Upon original issuance thereof, and until such time as the same is no
longer required under the applicable requirements of the Securities Act of 1933,
as amended (the "Act"), the Restricted Notes (and all securities issued in
exchange therefor or in substitution thereof) shall bear the following legend:



                                      -2-


                  THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S.
                  SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND,
                  ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED
                  STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS,
                  EXCEPT AS SET FORTH BELOW. BY ITS ACQUISITION HEREOF, THE
                  HOLDER (1) REPRESENTS THAT (a) IT IS A "QUALIFIED
                  INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
                  SECURITIES ACT) (A "QIB") OR (b) IT IS NOT A U.S. PERSON AND
                  IS ACQUIRING THE NOTE EVIDENCED HEREBY IN AN OFFSHORE
                  TRANSACTION, (2) AGREES THAT IT WILL NOT, WITHIN TWO YEARS
                  AFTER THE ORIGINAL ISSUANCE OF THIS SECURITY RESELL OR
                  OTHERWISE TRANSFER THIS SECURITY EXCEPT (a) TO THE COMPANY OR
                  ANY SUBSIDIARY THEREOF, (b) INSIDE THE UNITED STATES TO A QIB
                  IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (c)
                  INSIDE THE UNITED STATES TO AN ACCREDITED INVESTOR (AS DEFINED
                  IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT)
                  THAT, PRIOR TO SUCH TRANSFER, FURNISHES (OR HAS FURNISHED ON
                  ITS BEHALF BY A U.S. BROKER-DEALER) TO THE TRUSTEE A SIGNED
                  LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
                  RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS SECURITY (THE
                  FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE FOR THIS
                  SECURITY), (d) OUTSIDE THE UNITED STATES IN AN OFFSHORE
                  TRANSACTION IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER
                  THE SECURITIES ACT, (e) PURSUANT TO THE EXEMPTION FROM
                  REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
                  AVAILABLE), OR (f) PURSUANT TO AN EFFECTIVE REGISTRATION
                  STATEMENT UNDER THE SECURITIES ACT, AND (3) AGREES THAT IT
                  WILL GIVE TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED
                  A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN
                  CONNECTION WITH ANY TRANSFER OF THIS SECURITY, IF THE PROPOSED
                  TRANSFEREE IS AN ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR
                  TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND THE COMPANY SUCH
                  CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS EITHER
                  OF THEM MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER
                  IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A
                  TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF
                  THE SECURITIES ACT. AS USED HEREIN, THE TERMS "OFFSHORE
                  TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE
                  MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES
                  ACT.

     2. Offering. The Restricted Notes will be offered and sold to the Initial
Purchasers pursuant to an exemption from the registration requirements under the
Act. The



                                      -3-


Company has prepared an offering memorandum, dated November 16, 2001 (the
"Offering Memorandum"), relating to the Company and its subsidiaries and the
Restricted Notes.

     The Initial Purchasers have advised the Company that the Initial Purchasers
will make offers (the "Exempt Resales") of the Restricted Notes on the terms set
forth in the Offering Memorandum, as amended or supplemented, solely to (i)
persons whom the Initial Purchasers reasonably believe to be "qualified
institutional buyers," as defined in Rule 144A under the Act ("QIBs") and (ii)
non-U.S. persons outside the United States in reliance upon Regulation S
("Regulation S") under the Act (each, a "Reg S Investor"). The QIBs and the Reg
S Investors are collectively referred to herein as the "Eligible Purchasers."
The Initial Purchaser will offer the Restricted Notes to such Eligible
Purchasers initially at a price equal to that set forth on the cover of the
Offering Memorandum. Such price may be changed by the Initial Purchasers at any
time without notice.

     Holders (including subsequent transferees) of the Restricted Notes will
have the registration rights set forth in the registration rights agreement
relating thereto (the "Registration Rights Agreement"), to be dated the Closing
Date (as defined), for so long as such Restricted Notes constitute "Transfer
Restricted Securities" (as defined in the Registration Rights Agreement).
Pursuant to the Registration Rights Agreement, the Company and the Guarantors
will agree to file with the Securities and Exchange Commission (the
"Commission"), under the circumstances set forth therein, (i) a registration
statement under the Act (the "Exchange Offer Registration Statement") relating
to the Company's 8 3/4% Senior Subordinated Notes due 2009 (the "Exchange
Notes") and Guarantees thereof to be offered in exchange for the Restricted
Notes and Guarantees thereof (the "Exchange Offer") and (ii) a shelf
registration statement pursuant to Rule 415 under the Act (the "Shelf
Registration Statement" and, together with the Exchange Offer Registration
Statement, the "Registration Statements") relating to the resale by certain
holders of the Restricted Notes, and to use their commercially reasonable best
efforts to cause such Registration Statements to be declared effective and to
consummate the Exchange Offer. This Agreement, the Notes, the Guarantees, the
Indenture and the Registration Rights Agreement are hereinafter referred to
collectively as the "Operative Documents."

     (a) Purchase, Sale and Delivery. On the basis of the representations,
warranties and covenants contained in this Agreement, and subject to its terms
and conditions, the Company agrees to issue and sell to the Initial Purchasers,
and each Initial Purchaser agrees, severally and not jointly, to purchase from
the Company the principal amounts of Restricted Notes set forth opposite the
name of such Initial Purchaser on Schedule II hereto. The purchase price for the
Restricted Notes will be $929.04 per $1,000 principal amount Restricted Note.

     (b) Delivery of the Restricted Notes shall be made, against payment of the
purchase price therefor, at the offices of Kramer Levin Naftalis & Frankel LLP,
919 Third Avenue, New York, New York or such other location as may be mutually
acceptable. Such delivery and payment shall be made at 9:00 a.m., New York City
time, on November 21, 2001 or at such other time as shall be agreed upon by the
Initial Purchasers and the Company. The time and date of such delivery and
payment are herein called the "Closing Date."



                                      -4-


     (c) On the Closing Date, one or more Restricted Notes in definitive global
form, registered in the name of Cede & Co., as nominee of The Depository Trust
Company ("DTC"), having an aggregate amount corresponding to the aggregate
principal amount of the Restricted Notes (the "Global Note") sold pursuant to
Exempt Resales to Eligible Purchasers shall be delivered by the Company to the
Initial Purchasers (or as the Initial Purchasers direct), against payment by the
Initial Purchasers of the purchase price therefor, by wire transfer of same day
funds, to an account designated by the Company, provided that the Company shall
give at least two business days' prior notice to the Initial Purchasers of the
information required to effect such wire transfer. The Global Note shall be made
available to the Initial Purchasers for inspection not later than 9:30 a.m. on
the business day immediately preceding the Closing Date.

     3. Agreements of the Company and the Guarantors. Each of the Company and
the Guarantors covenants and agrees with the Initial Purchasers as follows:

     (a) To advise the Initial Purchasers promptly and, if requested by the
Initial Purchasers, confirm such advice in writing, (i) of the issuance by any
state securities commission of any stop order suspending the qualification or
exemption from qualification of any Notes or the related Guarantees for offering
or sale in any jurisdiction, or the initiation of any proceeding for such
purpose by any state securities commission or other regulatory authority and
(ii) of the happening of any event that makes any statement of a material fact
made in the Offering Memorandum untrue or that requires the making of any
additions to or changes in the Offering Memorandum in order to make the
statements therein, in the light of the circumstances under which they are made,
not misleading. The Company and the Guarantors shall use their commercially
reasonable best efforts to prevent the issuance of any stop order or order
suspending the qualification or exemption of any Notes or the related Guarantees
under any state securities or Blue Sky laws and, if at any time any state
securities commission or other regulatory authority shall issue an order
suspending the qualification or exemption of any Notes or the related Guarantees
under any state securities or Blue Sky laws, the Company and the Guarantors
shall use their commercially reasonable best efforts to obtain the withdrawal or
lifting of such order at the earliest possible time.

     (b) To furnish the Initial Purchasers and those persons identified by the
Initial Purchasers to the Company, without charge, as many copies of the
Offering Memorandum, including all documents incorporated therein by reference,
and any amendments or supplements thereto, as the Initial Purchasers may
reasonably request. The Company and the Guarantors consent to the use of the
Offering Memorandum, and any amendments and supplements thereto required
pursuant hereto, by the Initial Purchasers in connection with Exempt Resales.

     (c) Not to amend or supplement the Offering Memorandum during such period
as in the opinion of counsel for the Initial Purchasers the Offering Memorandum
is required by law to be delivered in connection with Exempt Resales and in
connection with market-making activities of the Initial Purchasers for so long
as any Restricted Notes are outstanding unless the Initial Purchasers shall
previously have been advised thereof and shall not have objected thereto within
a reasonable time after being furnished a copy thereof. The Company and the
Guarantors shall promptly prepare, upon the Initial Purchasers' request, any
amendment or supplement to the



                                      -5-


Offering Memorandum that may be necessary or advisable in connection with such
Exempt Resales or such market making activities.

     (d) If, during the period referred to in Section 4(c) above, any event
shall occur as a result of which, in the judgment of the Company and the
Guarantors or in the reasonable opinion of counsel for the Company and the
Guarantors or counsel for the Initial Purchasers, it becomes necessary or
advisable to amend or supplement the Offering Memorandum in order to make the
statements therein, in the light of the circumstances when such Offering
Memorandum is delivered to an Eligible Purchaser, not misleading, or if it is
necessary or advisable to amend or supplement the Offering Memorandum to comply
with applicable law, (i) to notify the Initial Purchasers and (ii) forthwith to
prepare an appropriate amendment or supplement to the Offering Memorandum so
that the statements therein as so amended or supplemented will not, in the light
of the circumstances when it is so delivered, be misleading, or so that the
Offering Memorandum will comply with applicable law.

     (e) To cooperate with the Initial Purchasers and counsel for the Initial
Purchasers in connection with the qualification or registration of the
Restricted Notes and the Guarantees thereof under the securities or Blue Sky
laws of such jurisdictions as the Initial Purchasers may reasonably request and
to continue such qualification in effect so long as required for the Exempt
Resales; provided, however, that neither the Company nor any Guarantor shall be
required in connection therewith to register or qualify as a foreign corporation
where it is not now so qualified or to take any action that would subject it to
service of process in suits or taxation, in each case, other than as to matters
and transactions relating to the Offering Memorandum or Exempt Resales, in any
jurisdiction where it is not now so subject.

     (f) Whether or not the transactions contemplated by this Agreement are
consummated or this Agreement becomes effective or is terminated, to pay all
costs, expenses, fees and taxes incident to the performance of the obligations
of the Company and the Guarantors hereunder, including in connection with: (i)
the preparation, printing, filing and distribution of the Offering Memorandum
(including but not limited to, without limitation, financial statements) and all
amendments and supplements thereto required pursuant hereto, (ii) the
preparation (including, without limitation, duplication costs) and delivery of
all agreements, correspondence and all other documents prepared and delivered in
connection herewith and with the Exempt Resales, (iii) the issuance, transfer
and delivery of the Restricted Notes and the Guarantees endorsed thereon to the
Initial Purchasers, (iv) the qualification or registration of the Notes and the
related Guarantees for offer and sale under the securities or Blue Sky laws of
the several states (including, without limitation, the cost of printing and
mailing a preliminary and final Blue Sky Memorandum and the reasonable fees and
disbursements of counsel for the Initial Purchasers relating thereto), (v)
furnishing such copies of the Offering Memorandum, and all amendments and
supplements thereto, as may be requested for use in connection with Exempt
Resales, (vi) the preparation of certificates for the Notes (including, without
limitation, printing and engraving thereof), (vii) the fees, disbursements and
expenses of the Company's and the Guarantors' counsel and accountants, (viii)
all fees and expenses (including fees and expenses of counsel) of the Company
and the Guarantors in connection with the approval of the Notes by DTC for
"book-entry" transfer, (ix) rating the Notes by rating agencies, (x) the
reasonable fees and expenses of the Trustee and its counsel, (xi) the
performance by the Company and the



                                      -6-


Guarantors of their other obligations under this Agreement and the other
Operative Documents and (xii) "roadshow" travel and other expenses incurred in
connection with the marketing and sale of the Notes.

     (g) To use the proceeds from the sale of the Restricted Notes in the manner
described in the Offering Memorandum under the caption "Use of Proceeds."

     (h) Not to voluntarily claim, and to resist actively any attempts to claim,
the benefit of any usury laws against the holders of any Notes.

     (i) To use their respective commercially reasonable best efforts to do and
perform all things required to be done and performed under this Agreement by
them prior to or after the Closing Date and use their respective commercially
reasonable best efforts to satisfy all conditions precedent on their part to the
delivery of the Restricted Notes.

     (j) Not to sell, offer for sale or solicit offers to buy or otherwise
negotiate in respect of any security (as defined in the Act) that would be
integrated with the sale of the Restricted Notes in a manner that would require
the registration under the Act of the sale to the Initial Purchasers or the
Eligible Purchasers of the Restricted Notes or to take any other action that
would result in the Exempt Resales not being exempt from registration under the
Act.

     (k) For so long as any of the Notes remain outstanding and during any
period in which the Company and the Guarantors are not subject to Section 13 or
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
to make available to any holder or beneficial owner of Restricted Notes in
connection with any sale thereof and any prospective purchaser of such
Restricted Notes from such holder or beneficial owner, the information required
by Rule 144A(d)(4) under the Act.

     (l) To cause the Exchange Offer to be made in the appropriate form to
permit registered Exchange Notes and the Guarantees thereof to be offered in
exchange for the Restricted Notes and the Guarantees thereof and to comply with
all applicable federal and state securities laws in connection with the Exchange
Offer.

     (m) To comply with the Registration Rights Agreement and the representation
letters to DTC relating to the approval of the Notes by DTC for "book-entry"
transfer.

     (n) To effect the inclusion of the Notes in PORTAL and to obtain approval
of the Restricted Notes by DTC for "book-entry" transfer.

     (o) During a period of two years following the Closing Date, to deliver
without charge to the Initial Purchasers, as they may reasonably request,
promptly upon their becoming available, copies of (i) all reports or other
publicly available information that the Company and the Guarantors shall mail or
otherwise make available to their securityholders and (ii) all reports,
financial statements and proxy or information statements filed by the Company
with the Commission or any national securities exchange and such other publicly
available information concerning the Company or any of its subsidiaries.



                                      -7-


     (p) Prior to the Closing Date, to furnish to the Initial Purchasers, as
soon as they have been prepared in the ordinary course by the Company, copies of
any unaudited interim financial statements for any period subsequent to the
periods covered by the financial statements appearing or incorporated in the
Offering Memorandum.

     (q) Not to take, directly or indirectly, any action designed to, or that
might reasonably be expected to, cause or result in stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Notes. Except as permitted by the Act, neither the Company nor
any Guarantor will distribute any (i) preliminary offering memorandum, (ii)
offering memorandum, including, without limitation, the Offering Memorandum, or
(iii) other offering material in connection with the offering and sale of the
Notes.

     4. Representations and Warranties.

     (a) The Company and the Guarantors, jointly and severally, represent and
warrant to the Initial Purchasers that:

          (i) The Offering Memorandum as of its date and as of the Closing Date
     does not and will not, and any supplement or amendment to it will not,
     contain any untrue statement of a material fact or omit to state any
     material fact required to be stated therein or necessary in order to make
     the statements therein, in the light of the circumstances under which they
     were made, not misleading, except that the representations and warranties
     contained in this paragraph shall not apply to statements in or omissions
     from the Offering Memorandum (or any supplement or amendment thereto) made
     in reliance upon and in conformity with information relating to the Initial
     Purchasers furnished to the Company and the Guarantors in writing by the
     Initial Purchasers expressly for use therein. No stop order preventing the
     use of the Offering Memorandum, or any amendment or supplement thereto, or
     any order asserting that any of the transactions contemplated by this
     Agreement are subject to the registration requirements of the Act, has been
     issued.

          (ii) (A) The documents incorporated by reference in the Offering
     Memorandum, when they were filed with the Commission, did not contain an
     untrue statement of a material fact or omit to state a material fact
     required to be stated therein or necessary to make the statements therein
     not misleading; (B) the documents incorporated by reference in the Offering
     Memorandum when they were filed with the Commission conformed in all
     material respects to the requirements of the Exchange Act; and (C) any
     further documents so filed and incorporated by reference in the Offering
     Memorandum or any further amendment or supplement thereto, when such
     documents are filed with the Commission, will conform in all material
     respects to the requirements of the Exchange Act.

          (iii) The accountants who have certified or will certify the financial
     statements included or to be included as part of the Offering Memorandum
     are independent accountants as required by the Act. The historical
     consolidated financial statements, together with related schedules and
     notes thereto, comply as to form in all material



                                      -8-


     respects with the requirements applicable to registration statements on
     Form S-1 under the Act and present fairly in all material respects the
     consolidated financial position and results of operations of the Company
     and its subsidiaries at the dates and for the periods indicated. Such
     financial statements have been prepared in accordance with generally
     accepted accounting principles applied on a consistent basis throughout the
     periods presented. The pro forma financial statements included in the
     Offering Memorandum fairly present the information purported to be shown
     therein at the respective dates thereof and for all respective periods
     covered thereby and all adjustments have been properly applied.

          (iv) Subsequent to the respective dates as of which information is
     given in the Offering Memorandum and up to the Closing Date, except as set
     forth in the Offering Memorandum, there has not been any material adverse
     change in the business, properties, operations, condition (financial or
     other) or results of operations of the Company and the subsidiaries (as
     defined below) taken as a whole, whether or not arising from transactions
     in the ordinary course of business, and since the date of the latest
     balance sheet of the Company included in the Offering Memorandum, and
     except as described in the Offering Memorandum, (A) neither the Company nor
     any subsidiary (1) has incurred or undertaken any liabilities or
     obligations, direct or contingent, that are, individually or in the
     aggregate, material to the Company and the subsidiaries taken as a whole,
     or (2) entered into any transaction not in the ordinary course of business
     that is material to the Company and the subsidiaries taken as a whole; and
     (B) the Company has not declared or paid any dividend on or made any
     distribution of or with respect to any shares of its capital stock or
     redeemed, purchased or otherwise acquired or agreed to redeem, purchase or
     otherwise acquire any shares of its or its subsidiaries' capital stock. As
     used in this Agreement, the term "subsidiary" means any corporation,
     partnership, joint venture, association, company, business trust or other
     entity in which the Company directly or indirectly (x) beneficially owns or
     controls at least 50% of the outstanding voting securities having by the
     terms thereof ordinary voting power to elect a majority of the board of
     directors (or other body fulfilling a substantially similar function) of
     such entity (irrespective of whether or not at the time any class or
     classes of such voting securities shall have or might have voting power by
     reason of the happening of any contingency) or (y) has the authority or
     ability to control the policies of such entity (including, but without
     limitation, any partnership of which the Company or a subsidiary is a
     general partner or owns or has the right to obtain a majority of limited
     partnership interests and any joint venture in which the Company or a
     subsidiary has liability similar to the liability of a general partner of a
     partnership or owns or has the right to obtain at least 50% of the joint
     venture interests); provided, however, that for the purposes of any
     representations and warranties made in this Section 5, the term
     "subsidiaries" shall include Keystone/Intrawest LLC, Slifer, Smith &
     Frampton/Vail Associates Real Estate, L.L.C., SSI Venture, LLC and Resort
     Technology Partners, LLC only to the extent of the Company's actual
     knowledge (the Company hereby representing to the Initial Purchasers that
     the Company does not manage the day to day operations of any of such
     subsidiaries); and provided further, that, for the purposes of any
     representations and warranties made in this Section 5, except for Section
     5(a)(i) and (ii), the term "subsidiaries" shall exclude



                                      -9-


     Avon Partners II, Limited Liability Company; Clinton Ditch & Reservoir
     Company; BC Housing, LLC; Eagle Park Reservoir Company; Boulder/Beaver,
     LLC; Eclipse Television and Sports Marketing LLC; Breckenridge Terrace,
     LLC; and Tenderfoot Seasonal Housing, LLC.

          (v) When the Restricted Notes and the Guarantees thereof are issued
     and delivered pursuant to this Agreement, no Restricted Note or Guarantee
     thereof will be of the same class (within the meaning of Rule 144A under
     the Act) as securities of the Company or any Guarantor that are listed on a
     national securities exchange registered under Section 6 of the Exchange Act
     or that are quoted in a United States automated inter-dealer quotation
     system.

          (vi) Each of the Company and the Guarantors has all requisite
     corporate power and authority to execute, deliver and perform its
     obligations under this Agreement and each of the other Operative Documents
     to which it is a party. This Agreement has been duly and validly
     authorized, executed and delivered by the Company and each Guarantor and
     (assuming the due authorization, execution and delivery by the Initial
     Purchasers) is a legal and binding obligation of the Company and each
     Guarantor, enforceable against each of them in accordance with its terms,
     subject to (A) applicable bankruptcy, insolvency, fraudulent transfer,
     reorganization, moratorium or similar laws now or hereafter in effect
     relating to creditors rights generally and (B) general principles of equity
     (regardless of whether such enforceability is considered in a proceeding at
     law or in equity except insofar as rights to indemnification and
     contribution contained herein may be limited by federal or state securities
     laws or related public policy).

          (vii) The Indenture has been duly and validly authorized by the
     Company and each Guarantor and, when duly executed and delivered by the
     Company and each Guarantor (assuming the due authorization, execution and
     delivery by the Trustee), will be a legal and binding agreement of the
     Company and each Guarantor, enforceable against each of them in accordance
     with its terms, subject to (A) applicable bankruptcy, insolvency,
     fraudulent transfer, reorganization, moratorium or similar laws now or
     hereafter in effect relating to creditors rights generally and (B) general
     principles of equity (regardless of whether such enforceability is
     considered in a proceeding at law or in equity except insofar as rights to
     indemnification and contribution contained herein may be limited by federal
     or state securities laws or related public policy). On the Closing Date,
     the Indenture will conform in all material respects to the requirements of
     the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"),
     and the rules and regulations of the Commission applicable to an indenture
     which is qualified thereunder. The Offering Memorandum contains a summary
     of the material terms of the Indenture, which is accurate in all material
     respects.

          (viii) The Registration Rights Agreement has been duly and validly
     authorized by the Company and each Guarantor and, when duly executed and
     delivered by the Company and each Guarantor (assuming due authorization,
     execution and delivery by the Initial Purchasers), will be a legal and
     binding obligation of the Company and each Guarantor, enforceable against
     each of them in accordance with its terms, subject to (A) applicable


                                      -10-


     bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or
     similar laws now or hereafter in effect relating to creditors rights
     generally and (B) general principles of equity (regardless of whether such
     enforceability is considered in a proceeding at law or in equity except
     insofar as rights to indemnification and contribution contained herein may
     be limited by federal or state securities laws or related public policy).
     The Offering Memorandum contains a summary of the material terms of the
     Registration Rights Agreement, which is accurate in all material respects.

          (ix) The Restricted Notes have been duly and validly authorized by the
     Company for issuance and sale to the Initial Purchasers pursuant to this
     Agreement and, when issued and authenticated in accordance with the terms
     of the Indenture and delivered against payment therefor in accordance with
     the terms hereof and thereof, will be the legal and binding obligations of
     the Company, enforceable against it in accordance with their terms and
     entitled to the benefits of the Indenture, subject to (A) applicable
     bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or
     similar laws now or hereafter in effect relating to creditors rights
     generally and (B) general principles of equity (regardless of whether such
     enforceability is considered in a proceeding at law or in equity except
     insofar as rights to indemnification and contribution contained herein may
     be limited by federal or state securities laws or related public policy).
     The Offering Memorandum contains a summary of the material terms of the
     Notes, which is accurate in all material respects.

          (x) The Guarantees of the Restricted Notes have been duly and validly
     authorized by each of the Guarantors and, when executed and delivered in
     accordance with the terms of the Indenture and when the Restricted Notes
     have been issued and authenticated in accordance with the terms of the
     Indenture and delivered against payment therefor in accordance with the
     terms hereof and thereof, will be the legal and binding obligations of each
     of the Guarantors, enforceable against each of them in accordance with
     their terms and entitled to the benefits of the Indenture, subject to (A)
     applicable bankruptcy, insolvency, fraudulent transfer, reorganization,
     moratorium or similar laws now and hereafter in effect relating to
     creditors rights generally and (B) general principles of equity (regardless
     of whether such enforceability is considered in a proceeding at law or in
     equity except insofar as rights to indemnification and contribution
     contained herein may be limited by federal or state securities laws or
     related public policy). The Offering Memorandum contains a summary of the
     material terms of the Guarantees, which is accurate in all material
     respects.

          (xi) The Exchange Notes have been duly and validly authorized for
     issuance by the Company and, when issued and authenticated in accordance
     with the terms of the Exchange Offer and the Indenture, will be the legal,
     valid and binding obligations of the Company, enforceable against it in
     accordance with their terms and entitled to the benefits of the Indenture,
     subject to (A) applicable bankruptcy, insolvency, fraudulent transfer,
     reorganization, moratorium or similar laws now and hereafter in effect
     relating to creditors rights generally and (B) general principles of equity
     (regardless of whether such enforceability is considered in a proceeding at
     law or in equity except insofar as



                                      -11-


     rights to indemnification and contribution contained herein may be limited
     by federal or state securities laws or related public policy).

          (xii) The Guarantees of the Exchange Notes have been duly and validly
     authorized by each of the Guarantors and, when executed and delivered in
     accordance with the terms of the Indenture and when the Exchange Notes have
     been issued and authenticated in accordance with the terms of the Exchange
     Offer and the Indenture, will be the legal and binding obligations of each
     of the Guarantors, enforceable against each of them in accordance with
     their terms and entitled to the benefits of the Indenture, subject to (A)
     applicable bankruptcy, insolvency, fraudulent transfer, reorganization,
     moratorium or similar laws now and hereafter in effect relating to
     creditors rights generally and (B) general principles of equity (regardless
     of whether such enforceability is considered in a proceeding at law or in
     equity except insofar as rights to indemnification and contribution
     contained herein may be limited by federal or state securities laws or
     related public policy).

          (xiii) The execution, delivery or performance by the Company or any
     Guarantor of this Agreement or any of the other Operative Documents to
     which it is a party will not (1) conflict with or result in a breach of any
     of the terms and provisions of, or constitute a default under (or an event
     that with notice or lapse of time, or both, would constitute a default
     under) or require approval or consent under, or result in the creation or
     imposition of any lien, charge or encumbrance upon any property or assets
     of the Company or any subsidiary pursuant to the terms of any agreement,
     contract, indenture, mortgage, lease, license, arrangement or understanding
     to which the Company or a subsidiary is a party, or to which any of their
     properties is subject, that is material to the Company and the subsidiaries
     taken as a whole (hereafter, collectively, "Material Contracts"), or any
     governmental franchise, license or permit heretofore issued to the Company
     or any subsidiary that is material to the Company and the subsidiaries
     taken as a whole (hereafter, collectively, "Material Permits"), (2) violate
     or conflict with any provision of the certificate of incorporation, by-laws
     or similar governing instruments of the Company or any subsidiary listed on
     Schedule III hereto (the "Material Subsidiaries") or (3) violate or
     conflict with any judgment, decree, order, statute, rule or regulation of
     any court or any public, governmental or regulatory agency or body having
     jurisdiction over the Company or any Material Subsidiary or any of its
     respective properties or assets, except for those violations or conflicts,
     that, individually or in the aggregate, could not reasonably be expected to
     have, a material adverse effect on the Company and its subsidiaries, taken
     as a whole (hereinafter referred to as a "Material Adverse Effect").

          (xiv) No consent, approval, authorization, order, registration,
     filing, qualification, license or permit of or with any court or any
     public, governmental or regulatory agency or body having jurisdiction over
     the Company or any subsidiary or any of its respective properties or assets
     is required for (A) the execution, delivery and performance by each of the
     Company and the Guarantors of this Agreement or any of the other Operative
     Documents to which it is a party or (B) the issuance and sale of the Notes,
     the issuance of the Guarantees and the transactions contemplated hereby and
     thereby, except such as have been or will be obtained and made on or prior
     to the Closing Date (or, in the case of the



                                      -12-


     Registration Rights Agreement, will be obtained and made under the Act, the
     Trust Indenture Act, and state securities or Blue Sky laws and
     regulations).

          (xv) All of the currently outstanding shares of capital stock of the
     Company, and all of the outstanding shares of capital stock (or similar
     interests) owned directly or indirectly by the Company of each of the
     subsidiaries of the Company have been duly and validly authorized and
     issued, are fully paid and nonassessable and were not issued in violation
     of or subject to any preemptive rights. The Company has, as of the date
     hereof, and will have, as of the Closing Date an authorized and outstanding
     capitalization as set forth in the Offering Memorandum, both on an
     historical basis and as adjusted to give effect to the offering of the
     Notes. The Company owns directly or indirectly such percentage of the
     outstanding capital stock (or similar interests) of each of its
     subsidiaries as is set forth opposite the name of such subsidiary in
     Schedule IV hereto, free and clear of all claims, liens, security
     interests, pledges, charges, encumbrances, stockholders agreements and
     voting trusts, subject to such exceptions as would not have a Material
     Adverse Effect.

          (xvi) The Company has no subsidiaries other than those listed in
     Schedule IV hereto. Each of the Company and the Material Subsidiaries has
     been duly organized and is validly existing as a corporation or other
     entity in good standing under the laws of its jurisdiction of incorporation
     or organization, as the case may be. Each of the Company and the Material
     Subsidiaries is duly qualified and in good standing as a foreign
     corporation or other entity in each jurisdiction in which the character or
     location of its properties (owned, leased or licensed) or the nature or
     conduct of its business makes such qualification necessary, except for
     those failures to be so qualified or in good standing that will not have a
     Material Adverse Effect. Each of the Company and the Material Subsidiaries
     has all requisite corporate, or other, power and authority, and all
     necessary consents, approvals, authorizations, orders, registrations,
     filings, qualifications, licenses and permits of and from all public,
     regulatory or governmental agencies and bodies, to own, lease and operate
     its properties and conduct its business as now being conducted and as
     described in the Offering Memorandum (except for those the absence of which
     would not have a Material Adverse Effect). Neither the Company nor any of
     the Material Subsidiaries has received any notice of proceedings relating
     to revocation or modification of any such consents, approvals,
     authorizations, orders, registrations, filings, qualifications, licenses or
     permits.

          (xvii) Neither the Company nor any subsidiary is in violation or
     breach of, or in default under (nor has an event occurred that with notice,
     lapse of time or both, would constitute a default under) any Material
     Contract, and each Material Contract is in full force and effect, and is
     the legal, valid, and binding obligation of the Company or such subsidiary,
     as the case may be, and (subject to applicable bankruptcy, insolvency, and
     other laws affecting the enforceability of creditors' rights generally) is
     enforceable as to the Company or such subsidiary, as the case may be, in
     accordance with its terms, subject to such exceptions which, individually
     or in the aggregate, do not have and are not reasonably likely to have a
     Material Adverse Effect. Neither the Company nor any



                                      -13-


     Material Subsidiary is in violation of its certificate of incorporation,
     by-laws or similar governing instrument.

          (xviii) There is no litigation, arbitration, claim, governmental or
     other proceeding or investigation pending or, to the best knowledge of the
     Company, threatened in writing with respect to the Company or any Material
     Subsidiary, or any of its respective operations, businesses, properties or
     assets, except as described in the Offering Memorandum, that, individually
     or in the aggregate, could reasonably be expected to have a Material
     Adverse Effect. Neither the Company nor any Material Subsidiary is, or, to
     the best knowledge of the Company, with the giving of notice or lapse of
     time or both would be, in violation of or non-compliance with the
     requirements of any Material Permit or the provisions of any law, rule,
     regulation, order, judgment or decree, including, but without limitation
     thereto, all applicable federal, state and local laws and regulations
     relating to (A) zoning, land use, protection of the environment, human
     health and safety or hazardous or toxic substances, wastes, pollutants or
     contaminants and (B) employee or occupational safety, discrimination in
     hiring, promotion or pay of employees, employee hours and wages or employee
     benefits, except for such violations or failures of compliance that,
     individually or in the aggregate, would not have a Material Adverse Effect.

          (xix) Except as described in the Offering Memorandum, the Company and
     each Material Subsidiary have (A) good and marketable title to all real and
     personal properties owned by them, free and clear of all liens, security
     interests, pledges, charges, encumbrances, and mortgages, and (B) valid,
     subsisting and enforceable leases for all real and personal properties
     leased by them, in each case, subject to such exceptions as, individually
     or in the aggregate, do not have and are not reasonably likely to have a
     Material Adverse Effect. Except as disclosed in the Offering Memorandum, no
     real property owned, leased, licensed or used by the Company or by a
     Material Subsidiary lies in an area that is, or to the best knowledge of
     the Company will be, subject to zoning, use, or building code restrictions
     that would prohibit or prevent the continued effective ownership, leasing,
     licensing, or use of such real property in the business of the Company or
     such Material Subsidiary as presently conducted or as the Offering
     Memorandum indicates is contemplated to be conducted, subject to such
     exceptions which, individually or in the aggregate, do not have and are not
     reasonably likely to have a Material Adverse Effect.

          (xx) The Company, directly or through one or more of the subsidiaries,
     owns or possesses all patents, patent rights, licenses, inventions,
     copyrights, trademarks, know-how (including trade secrets and other
     unpatented and/or unpatentable proprietary or confidential information,
     systems or procedures), service marks and trade names (collectively,
     "Intellectual Property") necessary to conduct its business as now conducted
     and proposed to be conducted as disclosed in the Offering Memorandum,
     except where the failure to own or possess such Intellectual Property,
     individually or in the aggregate, would not have a Material Adverse Effect.
     Neither the Company nor any subsidiary has received notice of infringement
     of or conflict with the asserted rights of others with respect to any
     Intellectual Property, except for those which would not have a



                                      -14-


     Material Adverse Effect. To the best actual knowledge of the Company's
     senior management (no duty of inquiry being implied), there is no
     infringement by others of any Intellectual Property of the Company or any
     subsidiary that has had or may in the future have a Material Adverse
     Effect. The Company or a predecessor has registered, and the Company or a
     subsidiary owns the rights to all registrations of the rights to the
     trademark and related logo for each of "Vail" and "Beaver Creek" in all
     jurisdictions in which the failure to so register or to so own such rights
     to such registrations would, individually or in the aggregate, have a
     Material Adverse Effect.

          (xxi) To the Company's best knowledge, neither the Company nor any
     subsidiary, nor any director, officer or employee of the Company or any
     subsidiary has, directly or indirectly, used any corporate funds for
     unlawful contributions, gifts, entertainment, or other unlawful expenses
     relating to political activity, made any unlawful payment to foreign or
     domestic government officials or employees or to foreign or domestic
     political parties or campaigns from corporate funds, violated any provision
     of the Foreign Corrupt Practices Act of 1977, as amended, or made any
     bribe, rebate, payoff, influence payment, kickback, or other unlawful
     payment.

          (xxii) There are no holders of securities of the Company or any of its
     subsidiaries who, by reason of the execution by the Company or any of the
     Guarantors of this Agreement or any other Operative Document to which it is
     a party or the consummation by the Company or any of the Guarantors of the
     transactions contemplated hereby and thereby, have the right to request or
     demand that the Company or any of its subsidiaries register under the Act
     or analogous foreign laws and regulations securities held by them other
     than pursuant to the Registration Right Agreement.

          (xxiii) None of the Company or any of its subsidiaries is an
     "investment company" or a company "controlled" by an "investment company"
     within the meaning of the Investment Company Act of 1940, as amended (the
     "Investment Company Act").

          (xxiv) Except pursuant to this Agreement, there are no contracts,
     agreements or understandings between the Company and its subsidiaries and
     any other person that would give rise to a valid claim against the Company
     or any of its subsidiaries or the Initial Purchasers for a brokerage
     commission, finder's fee or like payment in connection with the issuance,
     purchase and sale of the Notes.

          (xxv) Other than as disclosed in the Offering Memorandum, no labor
     dispute with the employees of the Company or any subsidiary exists or, to
     the best knowledge of the Company, is imminent that, individually or in the
     aggregate, is reasonably likely to have a Material Adverse Effect.

          (xxvi) (A) All United States Federal income tax returns of the Company
     and each subsidiary required by law to be filed have been filed and all
     taxes shown by such returns or otherwise assessed that are due and payable
     have been paid, except assessments against which appeals have been or will
     be promptly taken and (B) the Company and the subsidiaries have filed all
     other tax returns that are required to have been filed by them



                                      -15-


     pursuant to the applicable laws of all other jurisdictions, except, as to
     each of the foregoing clauses (A) and (B), insofar as the failure to file
     such returns, individually or in the aggregate, would not have a Material
     Adverse Effect, and the Company and the subsidiaries have paid all taxes
     due pursuant to said returns or pursuant to any assessment received by the
     Company or any subsidiary, except for such taxes, if any, as are being
     contested in good faith and as to which adequate reserves have been
     provided in accordance with US GAAP. The charges, accruals and reserves on
     the consolidated books of the Company in respect of any tax liability for
     any years not finally determined are adequate to meet any assessments or
     re-assessments for additional tax for any years not finally determined,
     except to the extent of any inadequacy that would not have a Material
     Adverse Effect.

          (xxvii) The Company and each subsidiary is insured by insurers of
     recognized financial responsibility against such losses and risks and in
     such amounts as are prudent and customary in the businesses in which the
     Company and the subsidiaries are engaged.

          (xxviii) Except as disclosed in, or incorporated by reference into,
     the Offering Memorandum, there are no business relationships or related
     party transactions of the nature described in Item 404 of Regulation S-K of
     the Commission involving the Company or any other persons referred to in
     such Item 404, except for such transactions that would be considered
     immaterial under such Item 404.

          (xxix) No action has been taken and no statute, rule, regulation or
     order has been enacted, adopted or issued by any governmental agency that
     prevents the issuance of the Notes or the Guarantees or prevents or
     suspends the use of the Offering Memorandum; no injunction, restraining
     order or order of any nature by a federal or state court of competent
     jurisdiction has been issued that prevents the issuance of the Notes or the
     Guarantees or prevents or suspends the sale of the Notes or the Guarantees
     in any jurisdiction referred to in Section 4(e) hereof; and every request
     of any securities authority or agency of any jurisdiction for additional
     information has been complied with in all material respects.

          (xxx) No registration under the Act of the Restricted Notes or the
     Guarantees thereof is required for the sale of the Restricted Notes to the
     Initial Purchasers as contemplated hereby or for the Exempt Resales
     assuming (A) that the purchasers who buy the Restricted Notes in the Exempt
     Resales are Eligible Purchasers and (B) the accuracy of the Initial
     Purchasers' representations regarding the absence of general solicitation
     in connection with the sale of Restricted Notes to the Initial Purchasers
     and the Exempt Resales contained herein. No form of general solicitation or
     general advertising (as defined in Regulation D under the Act) was used by
     the Company or any of the Guarantors or any of their representatives (other
     than the Initial Purchasers, as to which the Company and the Guarantors
     make no representation or warranty) in connection with the offer and sale
     of any of the Restricted Notes or the Guarantees thereof or in connection
     with Exempt Resales, including, but not limited to, articles, notices or
     other communications published in any newspaper, magazine, or similar
     medium or broadcast over television or radio, or any seminar or meeting
     whose attendees have been invited by any general solicitation or general
     advertising. No securities of the



                                      -16-


     same class as the Notes have been issued and sold by the Company or any of
     its subsidiaries within the six-month period immediately prior to the date
     hereof.

          (xxxi) The execution and delivery of this Agreement and the other
     Operative Documents and the sale of the Restricted Notes to be purchased by
     Eligible Purchasers will not involve any prohibited transaction within the
     meaning of Section 406 of ERISA or Section 4975 of the Internal Revenue
     Code of 1986, as amended. The representation made by the Company and the
     Guarantors in the preceding sentence is made in reliance upon and subject
     to the accuracy of, and compliance with, the representations and covenants
     made or deemed made by Eligible Purchasers as set forth in the Offering
     Memorandum under the caption "Transfer Restrictions."

          (xxxii) The statistical and market-related data included in the
     Offering Memorandum are based on or derived from sources which the Company
     and the Guarantors believe to be reliable and accurate in all material
     respects.

          (xxxiii) The Offering Memorandum, as of its date, contains the
     information specified in, and meets the requirements of, Rule 144A(d)(4)
     under the Act.

          (xxxiv) Prior to the effectiveness of any Registration Statement, the
     Indenture is not required to be qualified under the Trust Indenture Act.

          (xxxv) None of the execution, delivery and performance of this
     Agreement, the issuance and sale of the Notes, the application of the
     proceeds from the issuance and sale of the Notes and the consummation of
     the transactions contemplated thereby as set forth in the Offering
     Memorandum, will violate Regulations T, U or X promulgated by the Board of
     Governors of the Federal Reserve System.

          (xxxvi) Neither the Company nor any Guarantor intends to, nor believes
     that it will, incur debts beyond its ability to pay such debts as they
     mature. The present fair saleable value of the assets of the Company and
     each Guarantor exceeds the amount that will be required to be paid on or in
     respect of its existing debts and other liabilities (including contingent
     liabilities) as they become absolute and matured. The assets of the Company
     and each Guarantor does not constitute unreasonably small capital to carry
     out its business as conducted or as proposed to be conducted. Upon the
     issuance of the Notes and the Guarantees, the present fair saleable value
     of the assets of the Company and each Guarantor will exceed the amount that
     will be required to be paid on or in respect of its existing debts and
     other liabilities (including contingent liabilities) as they become
     absolute and matured. Upon the issuance of the Notes and the Guarantees,
     the assets of the Company and each Guarantor will not constitute
     unreasonably small capital to carry out its business as now conducted.

          (xxxvii) Each certificate signed by any officer of the Company or any
     Guarantor and delivered to the Initial Purchasers or counsel for the
     Initial Purchasers shall be deemed to be a representation and warranty by
     the Company or such Guarantor, as the case may be, to the Initial
     Purchasers as to the matters covered thereby.



                                      -17-


          (xxxviii)Each of the Company and the Guarantors acknowledge that the
     Initial Purchasers and, for purposes of the opinions to be delivered to the
     Initial Purchasers pursuant to Section 8 hereof, counsel for the Company
     and the Guarantors and counsel for the Initial Purchasers, will rely upon
     the accuracy and truth of the foregoing representations and hereby consent
     to such reliance.

          (xxxix) None of the Company, the Guarantors nor any of their
     respective affiliates or any person acting on its or their behalf (other
     than the Initial Purchasers, as to whom the Company and the Guarantors make
     no representation) has engaged or will engage in any directed selling
     efforts within the meaning of Regulation S with respect to the Restricted
     Notes.

          (xl) The Restricted Notes offered and sold in reliance on Regulation S
     have been and will be offered and sold only in offshore transactions.

          (xli) The sale of the Restricted Notes pursuant to Regulation S is not
     part of a plan or scheme to evade the registration provisions of the Act.

          (xlii) The Company, the Guarantors and their respective affiliates and
     all persons acting on their behalf (other than the Initial Purchasers, as
     to whom the Company and the Guarantors make no representation) have
     complied with and will comply with the offering restrictions requirements
     of Regulation S in connection with the offering of the Restricted Notes
     outside the United States and, in connection therewith, the Offering
     Memorandum contains the disclosure required by Rule 902(g)(2).

          (xliii) Each of the Company and the Guarantors is a "reporting
     issuer," as defined in Rule 902 under the Act.

     (b) Each of the Initial Purchasers, severally and not jointly, represents,
warrants and covenants to the Company and the Guarantors and agrees that:

          (i) Such Initial Purchaser is a QIB, with such knowledge and
     experience in financial and business matters as are necessary in order to
     evaluate the merits and risks of an investment in the Restricted Notes.

          (ii) Such Initial Purchaser (A) is not acquiring the Restricted Notes
     with a view to any distribution thereof that would violate the Act or the
     securities laws of any state of the United States or any other applicable
     jurisdiction and (B) will be reoffering and reselling the Restricted Notes
     only to QIBs in reliance on the exemption from the registration
     requirements of the Act provided by Rule 144A and in offshore transactions
     in reliance upon Regulation S under the Act.

          (iii) No form of general solicitation or general advertising (within
     the meaning of Regulation D under the Act) has been or will be used by such
     Initial Purchaser or any of its representatives in connection with the
     offer and sale of any of the Restricted Notes or Guarantees, including, but
     not limited to, articles, notices or other communications published in any
     newspaper, magazine, or similar medium or broadcast over television or


                                      -18-


     radio, or any seminar or meeting whose attendees have been invited by any
     general solicitation or general advertising.

          (iv) Such Initial Purchaser agrees that, in connection with the Exempt
     Resales, it will solicit offers to buy the Restricted Notes only from, and
     will offer to sell the Restricted Notes only to, Eligible Purchasers. Such
     Initial Purchaser further agrees that (A) it will offer to sell the
     Restricted Notes only to, and will solicit offers to buy the Restricted
     Notes only from Eligible Purchasers who in purchasing such Restricted Notes
     will be deemed to have represented and agreed that they are purchasing the
     Restricted Notes for their own account or accounts with respect to which
     they exercise sole investment discretion and that they or such accounts are
     Eligible Purchasers, and (B) such Eligible Purchasers will acknowledge and
     agree that such Restricted Notes will not have been registered under the
     Act and may be resold, pledged or otherwise transferred within two years of
     issuance only (1) to the Company or any subsidiary thereof, (2) inside the
     United States to a QIB in compliance with Rule 144A under the Act, (3)
     inside the United States to an accredited investor (as defined in Rule
     501(a)(1), (2), (3) or (7) under the Act) that, prior to such transfer,
     furnishes (or has furnished on its behalf by a U.S. broker-dealer) to the
     trustee a signed letter containing certain representations and agreements
     relating to the restrictions on transfer of this security (the form of
     which letter can be obtained from the trustee for this security), (4)
     outside the United States in an offshore transaction in compliance with
     Rule 904 of Regulation S under the Act, (5) pursuant to the exemption from
     registration provided by Rule 144 under the Act (if available), or (6)
     pursuant to an effective registration statement under the Act, and (C)
     acknowledges that it will, and each subsequent holder is required to,
     notify any purchaser of a Restricted Note of the resale restrictions set
     forth in (B) above.

          (v) Such Initial Purchaser and its affiliates or any person acting on
     its or their behalf have not engaged and will not engage in any directed
     selling efforts within the meaning of Regulation S with respect to the
     Restricted Notes or the Guarantees thereof.

          (vi) The Restricted Notes offered and sold by such Initial Purchaser
     pursuant hereto in reliance on Regulation S have been and will be offered
     and sold only in offshore transactions.

          (vii) The sale of Restricted Notes offered and sold by such Initial
     Purchaser pursuant hereto in reliance on Regulation S is not part of a plan
     or scheme to evade the registration provisions of the Act.

          (viii) Such Initial Purchaser agrees that it has not offered or sold
     and will not offer or sell the Restricted Notes in the United States or to,
     or for the benefit or account of, a U.S. Person (other than a distributor),
     in each case, as defined in Rule 902 under the Act (1) as part of its
     distribution at any time and (2) otherwise until 40 days after the later of
     the commencement of the offering of the Restricted Notes pursuant hereto
     and the Closing Date, other than in accordance with Regulation S of the Act
     or another exemption from the registration requirements of the Act. Such
     Initial Purchaser agrees that, during such 40-day distribution compliance
     period, it will not cause any



                                      -19-


     advertisement with respect to the Restricted Notes (including any
     "tombstone" advertisement) to be published in any newspaper or periodical
     or posted in any public place and will not issue any circular relating to
     the Restricted Notes, except such advertisements as are permitted by and
     include the statements required by Regulation S.

          (ix) Such Initial Purchaser agrees that, at or prior to confirmation
     of a sale of Restricted Notes by it to any distributor, dealer or person
     receiving a selling concession, fee or other remuneration during the 40-day
     distribution compliance period referred to in Rule 903(c)(2) under the Act,
     it will send to such distributor, dealer or person receiving a selling
     concession, fee or other remuneration a confirmation or notice to
     substantially the following effect:

          "The Restricted Notes covered hereby have not been registered under
          the U.S. Securities Act of 1933, as amended (the "Securities Act"),
          and may not be offered and sold within the United States or to, or for
          the account or benefit of, U.S. persons (i) as part of your
          distribution at any time or (ii) otherwise until 40 days after the
          later of the commencement of the Offering and the Closing Date, except
          in either case in accordance with Regulation S under the Securities
          Act (or Rule 144A or to an accredited investor (as defined in Rule
          501(a)(1), (2), (3) or (7) under the Securities Act) in transactions
          that are exempt from the registration requirements of the Securities
          Act), and in connection with any subsequent sale by you of the
          Restricted Notes covered hereby in reliance on Regulation S during the
          period referred to above to any distributor, dealer or person
          receiving a selling concession, fee or other remuneration, you must
          deliver a notice to substantially the foregoing effect. Terms used
          above have the meanings assigned to them in Regulation S."

     The Initial Purchasers acknowledge that the Company and the Guarantors and,
for purposes of the opinions to be delivered to the Initial Purchasers pursuant
to Section 8 hereof, counsel for the Company and the Guarantors and counsel for
the Initial Purchasers will rely upon the accuracy and truth of the foregoing
representations and hereby consent to such reliance.

     5. Indemnification.

     (a) The Company and the Guarantors, jointly and severally, agree to
indemnify and hold harmless (i) the Initial Purchasers, (ii) each person, if
any, who controls the Initial Purchasers within the meaning of Section 15 of the
Act or Section 20(a) of the Exchange Act and (iii) the respective officers,
directors, partners, employees, representatives and agents of the Initial
Purchasers or any controlling person against any and all losses, liabilities,
claims, damages and expenses whatsoever (including but not limited to reasonable
attorneys' fees and any and all expenses whatsoever incurred in investigating,
preparing or defending against any investigation or litigation, commenced or
threatened, or any claim whatsoever, and any and all amounts paid in settlement
of any claim or litigation, provided that such settlement was effected with the
Company's and the Guarantor's written consent in accordance with Section 6(c)
hereof), joint or several, to which they or any of them may become subject under
the Act, the Exchange Act or



                                      -20-


otherwise, insofar as such losses, liabilities, claims, damages or expenses (or
actions in respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of a material fact contained in the Offering
Memorandum (including the documents incorporated by reference therein), or in
any supplement thereto or amendment thereof, or arise out of or are based upon
the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that neither the Company nor any Guarantor will be liable in any such case to
the extent, but only to the extent, that any such loss, liability, claim, damage
or expense arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in reliance upon
and in conformity with information relating to the Initial Purchasers furnished
to the Company and the Guarantors in writing by or on behalf of the Initial
Purchasers expressly for use therein. This indemnity agreement will be in
addition to any liability which the Company and the Guarantors may otherwise
have, including under this Agreement.

     (b) The Initial Purchasers, severally and not jointly, agree to indemnify
and hold harmless (i) the Company and the Guarantors, (ii) each person, if any,
who controls the Company or any of the Guarantors within the meaning of Section
15 of the Act or Section 20(a) of the Exchange Act, and (iii) the officers,
directors, partners, employees, representatives and agents of the Company and
the Guarantors, against any losses, liabilities, claims, damages and expenses
whatsoever (including but not limited to reasonable attorneys' fees and any and
all expenses whatsoever incurred in investigating, preparing or defending
against any investigation or litigation, commenced or threatened, or any claim
whatsoever and any and all amounts paid in settlement of any claim or
litigation, provided that such settlement was effected with such Initial
Purchaser's written consent in accordance with Section 6(c) hereof), joint or
several, to which they or any of them may become subject under the Act, the
Exchange Act or otherwise, insofar as such losses, liabilities, claims, damages
or expenses (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained in the
Offering Memorandum, or in any amendment thereof or supplement thereto, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, in each case to the extent, but only to the extent, that any such
loss, liability, claim, damage or expense arises out of or is based upon any
untrue statement or alleged untrue statement or omission or alleged omission
made therein in reliance upon and in conformity with information relating to the
Initial Purchasers furnished to the Company and the Guarantors in writing by or
on behalf of the Initial Purchasers expressly for use therein; provided,
however, that in no case shall the Initial Purchasers be liable or responsible
for any amount in excess of the discounts and commissions received by the
Initial Purchasers, as set forth on the cover page of the Offering Memorandum.
This indemnity will be in addition to any liability which the Initial Purchasers
may otherwise have, including under this Agreement.

     (c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify each party against whom indemnification is
to be sought in writing of the commencement thereof (but the failure so to
notify an indemnifying party shall not relieve it from any liability which it
may



                                      -21-


have under this Section 6 except to the extent that it has been prejudiced in
any material respect by such failure or from any liability which it may
otherwise have). In case any such action is brought against any indemnified
party, and it notifies an indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein, and to the extent it
may elect by written notice delivered to the indemnified party promptly after
receiving the aforesaid notice from such indemnified party, to assume the
defense thereof with counsel reasonably satisfactory to such indemnified party.
Notwithstanding the foregoing, the indemnified party or parties shall have the
right to employ its or their own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of such indemnified party or
parties unless (i) the employment of such counsel shall have been authorized in
writing by the indemnifying parties in connection with the defense of such
action, (ii) the indemnifying parties shall not have employed counsel to take
charge of the defense of such action within a reasonable time after notice of
commencement of the action, or (iii) such indemnified party or parties shall
have reasonably concluded that there may be defenses available to it or them
which are different from or additional to those available to one or all of the
indemnifying parties (in which case the indemnifying party or parties shall not
have the right to direct the defense of such action on behalf of the indemnified
party or parties with respect to such different defenses), in any of which
events such fees and expenses of counsel shall be borne by the indemnifying
parties; provided, however, that the indemnifying party under subsection (a) or
(b) above shall only be liable for the legal expenses of one counsel (in
addition to any local counsel) for all indemnified parties in each jurisdiction
in which any claim or action is brought. Anything in this subsection to the
contrary notwithstanding, an indemnifying party shall not be liable for any
settlement of any claim or action effected without its prior written consent,
provided that such consent was not unreasonably withheld.

     6. Contribution. In order to provide for contribution in circumstances in
which the indemnification provided for in Section 6 is for any reason held to be
unavailable from an indemnifying party or is insufficient to hold harmless a
party indemnified thereunder, the Company and the Guarantors, on the one hand,
and the Initial Purchasers, on the other hand, shall contribute to the aggregate
losses, liabilities, claims, damages and expenses of the nature contemplated by
such indemnification provision (including any investigation, legal and other
expenses reasonably incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claims asserted, but after
deducting in the case of losses, liabilities, claims, damages and expenses
suffered by the Company or any Guarantor, any contribution received by the
Company and the Guarantors from persons, other than the Initial Purchasers, who
may also be liable for contribution, including persons who control the Company
or any of the Guarantors within the meaning of Section 15 of the Act or Section
20(a) of the Exchange Act) to which the Company, the Guarantors and the Initial
Purchasers may be subject, in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Guarantors, on the one hand,
and the Initial Purchasers, on the other hand, from the offering of the
Restricted Notes or, if such allocation is not permitted by applicable law or
indemnification is not available as a result of the indemnifying party not
having received notice as provided in Section 6, in such proportion as is
appropriate to reflect not only the relative benefits referred to above but also
the relative fault of the Company and the Guarantors, on the one hand, and the
Initial Purchasers, on the other hand, in connection with the statements or


                                      -22-


omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations. The relative
benefits received by the Company and the Guarantors, on the one hand, and the
Initial Purchasers, on the other hand, shall be deemed to be in the same
proportion as (i) the total proceeds from the offering of Restricted Notes (net
of discounts and commissions but before deducting expenses) received by the
Company and the Guarantors and (ii) the discounts and commissions received by
the Initial Purchasers, respectively, in each case as set forth on the cover
page of the Offering Memorandum. The relative fault of the Company and the
Guarantors, on the one hand, and of the Initial Purchasers, on the other hand,
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company, any
Guarantor or the Initial Purchasers and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company, the Guarantors and the Initial Purchasers agree that it
would not be just and equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation (even if the Initial Purchasers were treated
as one entity for such purpose) or by any other method of allocation which does
not take into account the equitable considerations referred to above.

     Notwithstanding the provisions of this Section 7, (i) in no case shall the
Initial Purchasers be required to contribute any amount in excess of the amount
by which the discounts and commissions applicable to the Restricted Notes
purchased by the Initial Purchasers pursuant to this Agreement exceeds the
amount of any damages which the Initial Purchasers has otherwise been required
to pay by reason of any untrue or alleged untrue statement or omission or
alleged omission and (ii) no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 7, (A) each person, if any, who
controls the Initial Purchasers within the meaning of Section 15 of the Act or
Section 20(a) of the Exchange Act and (B) the respective officers, directors,
partners, employees, representatives and agents of the Initial Purchasers or any
controlling person shall have the same rights to contribution as the Initial
Purchasers, and (A) each person, if any, who controls the Company or any
Guarantor within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act and (B) the respective officers, directors, partners, employees,
representatives and agents of the Company and the Guarantors shall have the same
rights to contribution as the Company and the Guarantors, subject in each case
to clauses (i) and (ii) of this Section 7. Any party entitled to contribution
will, promptly after receipt of notice of commencement of any action, suit or
proceeding against such party in respect of which a claim for contribution may
be made against another party or parties under this Section 7, notify such party
or parties from whom contribution may be sought, but the failure to so notify
such party or parties shall not relieve the party or parties from whom
contribution may be sought from any obligation it or they may have under this
Section 7 or otherwise. No party shall be liable for contribution with respect
to any action or claim settled without its prior written consent, provided that
such written consent was not unreasonably withheld. The Initial Purchasers'
obligations to contribute pursuant to this Section 7 are several in proportion
to the respective principal amounts of Restricted Notes purchased by each of the
Initial Purchasers hereunder and not joint.



                                      -23-


     7. Conditions of Initial Purchasers' Obligations. The obligations of the
Initial Purchasers to purchase and pay for the Restricted Notes, as provided
herein, shall be subject to the satisfaction of the following conditions:

     (a) At the Closing Date, the Initial Purchasers shall have received a
certificate of the Company, executed by each of the Chief Executive Officer and
the Chief Financial Officer of the Company, and a certificate of each Guarantor,
executed by two authorized officers of such Guarantor, dated the date of its
delivery, to the effect that as of the date of such certificate the
representations and warranties of the Company or the Guarantor, as applicable,
set forth in Section 5 hereof are true and correct in all material respects as
of such Closing Date, the obligations of the Company or the Guarantor, as
applicable, to be performed hereunder on or prior thereto have been duly
performed in all material respects, and subsequent to the respective dates of
which information is given in the Offering Memorandum, the Company or Guarantor,
as applicable, and its subsidiaries have not sustained any material loss or
interference with their respective businesses or properties from fire, flood,
hurricane, accident or other calamity, whether or not covered by insurance, or
from any labor dispute or any legal or governmental proceeding, and there has
not been any material adverse change, or any development involving a material
adverse change, in the business prospects, properties, operations, condition
(financial or otherwise), or results of operations of the Company and its
subsidiaries taken as a whole, except in which case as described in or
contemplated by the Offering Memorandum.

     (b) At the Closing Date, the Initial Purchasers shall have received (i) the
written opinion of Martha D. Rehm, Esq., General Counsel to the Company, dated
the Closing Date, addressed to the Initial Purchasers, in form and substance
reasonably acceptable to the Initial Purchasers' counsel, (ii) the written
opinion of Cahill Gordon & Reindel, special counsel for the Company, dated the
Closing Date, addressed to the Initial Purchasers, in form and substance
reasonably satisfactory to Initial Purchasers' counsel and (iii) the written
opinion of Arnold & Porter, special counsel for the Company, dated the Closing
Date, addressed to the Initial Purchasers, in form and substance reasonably
satisfactory to Initial Purchasers' counsel.

     (c) At the Closing Date, the Initial Purchasers shall have received the
written opinion of Balcomb & Green, P.C., special counsel for the Initial
Purchasers, dated the Closing Date, addressed to the Initial Purchasers, in form
and substance reasonably satisfactory to Initial Purchasers' counsel.

     (d) At the time this Agreement is executed and at the Closing Date, the
Initial Purchasers shall have received from Arthur Andersen LLP, independent
public accountants, dated as of the date of this Agreement and as of the Closing
Date, customary comfort letters addressed to the Initial Purchasers and in form
and substance satisfactory to the Initial Purchasers and counsel for the Initial
Purchasers with respect to the financial statements and certain financial
information of the Company and its subsidiaries contained in the Offering
Memorandum and/or incorporated therein by reference.

     (e) The Initial Purchasers shall have received an opinion, dated the
Closing Date, in form and substance reasonably satisfactory to the Initial
Purchasers, of Kramer Levin Naftalis



                                      -24-


& Frankel LLP, counsel for the Initial Purchasers, covering such matters as are
customarily covered in such opinions.

     (f) Kramer Levin Naftalis & Frankel LLP shall have been furnished with such
documents, in addition to those set forth above, as they may reasonably require
for the purpose of enabling them to review or pass upon the matters referred to
in this Section 8 and in order to evidence the accuracy, completeness or
satisfaction in all material respects of any of the representations, warranties
or conditions herein contained.

     (g) Prior to the Closing Date, the Company and the Guarantors shall have
furnished to the Initial Purchasers such further information, certificates and
documents as the Initial Purchasers may reasonably request.

     (h) The Company, the Guarantors and the Trustee shall have entered into the
Indenture and the Initial Purchasers shall have received counterparts, conformed
as executed, thereof.

     (i) The Company, the Guarantors and the Initial Purchasers shall have
entered into the Registration Rights Agreement and the Initial Purchasers shall
have received counterparts, conformed as executed, thereof.

     (j) On or after the date hereof, (i) there shall not have occurred any
downgrading, suspension or withdrawal of, nor shall any notice have been given
of any potential or intended downgrading, suspension or withdrawal of, or of any
review (or of any potential or intended review) for a possible change that does
not indicate the direction of the possible change in, any rating of the Company
or any Guarantor or any securities of the Company or any Guarantor (including,
without limitation, the placing of any of the foregoing ratings on credit watch
with negative or developing implications or under review with an uncertain
direction) by any "nationally recognized statistical rating organization" as
such term is defined for purposes of Rule 436(g)(2) under the Act, (ii) there
shall not have occurred any change, nor shall any notice have been given of any
potential or intended change, in the outlook for any rating of the Company or
any Guarantor or any securities of the Company or any Guarantor by any such
rating organization and (iii) no such rating organization shall have given
notice that it has assigned (or is considering assigning) a lower rating to the
Notes than that on which the Notes were marketed.

     (k) The Notes shall have been approved for trading on PORTAL.

     (l) All opinions, certificates, letters and other documents required by
this Section 8 to be delivered by the Company and the Guarantors will be in
compliance with the provisions hereof only if they are reasonably satisfactory
in form and substance to the Initial Purchasers. The Company and the Guarantors
shall furnish the Initial Purchasers with such conformed copies of such
opinions, certificates, letters and other documents as it shall reasonably
request.

     8. Initial Purchasers' Information. The Company and the Guarantors
acknowledge that the statements with respect to the offering of the Restricted
Notes set forth in (i) the third sentence of the penultimate paragraph on the
cover page and (ii) the first and last two



                                      -25-


paragraphs in "Private Placement" in the Offering Memorandum constitute the only
information relating to any of the Initial Purchasers furnished to the Company
and the Guarantors in writing by or on behalf of the Initial Purchasers
expressly for use in the Offering Memorandum.

     9. Survival of Representations and Agreements. All representations and
warranties, covenants and agreements of the Initial Purchasers, the Company and
the Guarantors contained in this Agreement, including the agreements contained
in Sections 4(f) and 11(d), the indemnity agreements contained in Section 6 and
the contribution agreements contained in Section 7, shall remain operative and
in full force and effect regardless of any investigation made by or on behalf of
the Initial Purchasers, any controlling person thereof, or by or on behalf of
the Company, the Guarantors or any controlling person thereof, and shall survive
delivery of and payment for the Restricted Notes to and by the Initial
Purchasers. The representations contained in Section 5 and the agreements
contained in Sections 4(f), 6, 7 and 11(d) shall survive the termination of this
Agreement, including any termination pursuant to Section 11.

     10. Effective Date of Agreement; Termination.

     (a) This Agreement shall become effective upon execution and delivery of a
counterpart hereof by each of the parties hereto.

     (b) The Initial Purchasers shall have the right to terminate this Agreement
at any time prior to the Closing Date by notice to the Company from the Initial
Purchasers, without liability (other than with respect to Sections 6 and 7) on
the Initial Purchasers' part to the Company or any of the Guarantors if, on or
prior to such date, (i) the Company or any of the Guarantors shall have failed,
refused or been unable to perform in any material respect any agreement on its
part to be performed hereunder, (ii) any other condition to the obligations of
the Initial Purchasers hereunder as provided in Section 8 is not fulfilled when
and as required in any material respect, (iii) in the reasonable judgment of the
Initial Purchasers, any material adverse change shall have occurred since the
respective dates as of which information is given in the Offering Memorandum in
the condition (financial or otherwise), business, prospects, or results of
operations of the Company and its subsidiaries, taken as a whole, other than as
set forth in the Offering Memorandum, or (iv) (A) trading in securities
generally on the New York Stock Exchange, the American Stock Exchange, or the
Nasdaq National Market shall have been suspended or materially limited, or
minimum or maximum prices for trading shall have been established, or maximum
ranges for prices for securities shall have been required, on such exchange or
the Nasdaq National Market, or by such exchange or other regulatory body or
governmental authority having jurisdiction; or (B) a banking moratorium shall
have been declared by federal or state authorities; or (C) there is an outbreak
or escalation of armed hostilities involving the United States on or after the
date hereof, or if there has been a declaration by the United States of a
national emergency or war, the effect of which shall be, in the Initial
Purchasers' judgment, to make it inadvisable or impracticable to proceed with
the offering or delivery of the Restricted Notes on the terms and in the manner
contemplated in the Offering Memorandum; or (D) there shall have occurred such a
material adverse change in the financial markets in the United States or any
other calamity or crisis or materially adverse change in general economic,
political or financial conditions having an effect on the U.S. financial



                                      -26-


markets such as, in the Initial Purchasers' judgment, makes it inadvisable or
impracticable to proceed with the delivery of the Restricted Notes as
contemplated hereby.

     (c) Any notice of termination pursuant to this Section 11 shall be by
telephone or facsimile and, in either case, confirmed in writing by letter.

     (d) If this Agreement shall be terminated pursuant to any of the provisions
hereof (otherwise than pursuant to clause (iv) of Section 11(b), in which case
each party will be responsible for its own expenses), or if the sale of the
Restricted Notes provided for herein is not consummated because any condition to
the obligations of the Initial Purchasers set forth herein is not satisfied or
because of any refusal, inability or failure on the part of the Company or any
Guarantor to perform any agreement herein or comply with any provision hereof,
the Company and the Guarantors shall reimburse the Initial Purchasers for all
out-of-pocket expenses (including the reasonable fees and expenses of the
Initial Purchasers' counsel), incurred by the Initial Purchasers in connection
herewith.

     (e) If on the Closing Date any one or more of the Initial Purchasers shall
fail or refuse to purchase the Restricted Notes which it or they have agreed to
purchase hereunder on such date and the aggregate principal amount of the
Restricted Notes which such defaulting Initial Purchaser or Initial Purchasers,
as the case may be, agreed but failed or refused to purchase is not more than
one-tenth of the aggregate principal amount of the Restricted Notes to be
purchased on such date by all Initial Purchasers, each non-defaulting Initial
Purchaser shall be obligated severally, in the proportion which the principal
amount of the Restricted Notes set forth opposite its name in Schedule II bears
to the aggregate principal amount of the Restricted Notes which all the
non-defaulting Initial Purchasers, as the case may be, have agreed to purchase,
or in such other proportion as Deutsche Banc Alex. Brown Inc. ("Deutsche Bank")
may specify, to purchase the Restricted Notes which such defaulting Initial
Purchaser or Initial Purchasers, as the case may be, agreed but failed or
refused to purchase on such date; provided that in no event shall the aggregate
principal amount of the Restricted Notes which any Initial Purchaser has agreed
to purchase pursuant to Section 3 hereof be increased pursuant to this Section
11 by an amount in excess of one-ninth of such principal amount of the
Restricted Notes without the written consent of such Initial Purchaser. If on
the Closing Date any Initial Purchaser or Initial Purchasers shall fail or
refuse to purchase the Restricted Notes and the aggregate principal amount of
the Restricted Notes with respect to which such default occurs is more than
one-tenth of the aggregate principal amount of the Restricted Notes to be
purchased by all Initial Purchasers and arrangements satisfactory to the Initial
Purchasers and the Company for purchase of such the Restricted Notes are not
made within 48 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Initial Purchaser and the Company.
In any such case which does not result in termination of this Agreement, either
Deutsche Bank or the Company shall have the right to postpone the Closing Date,
but in no event for longer than seven days, in order that the required changes,
if any, in the Offering Memorandum or any other documents or arrangements may be
effected. Any action taken under this paragraph shall not relieve any defaulting
Initial Purchaser from liability in respect of any default of any such Initial
Purchaser under this Agreement.



                                      -27-


     11. Notice. All communications hereunder, except as may be otherwise
specifically provided herein, shall be in writing and, if sent to the Initial
Purchasers shall be mailed, delivered, telecopied and confirmed in writing or
sent by a nationally recognized overnight courier service guaranteeing delivery
on the next business day to Deutsche Banc Alex. Brown Inc., 31 West 52nd Street,
New York, New York 10019, Attention: Leveraged Finance Group, telecopy number:
(646) 324-7467, with a copy to Kramer Levin Naftalis & Frankel LLP, 919 Third
Avenue, New York, New York 10022, Attention: Howard A. Sobel, Esq., telecopy
number: (212) 715-8000; and if sent to the Company and the Guarantors, shall be
mailed, delivered, telecopied and confirmed in writing or sent by a nationally
recognized overnight courier service guaranteeing delivery on the next business
day to Vail Resort, Inc., 137 Benchmark Road, Avon, Colorado 81620, Attention:
Chief Financial Officer, telecopy number: (970) 845-2521, with a copy to Cahill
Gordon & Reindel, 80 Pine Street, New York, New York 10005, Attention: James J.
Clark, Esq., telecopy number: (212) 269-5420.

     12. Parties. This Agreement shall inure solely to the benefit of, and shall
be binding upon, the Initial Purchasers, the Company, the Guarantors and the
controlling persons and agents referred to in Sections 6 and 7, and their
respective successors and assigns, and no other person shall have or be
construed to have any legal or equitable right, remedy or claim under or in
respect of or by virtue of this Agreement or any provision herein contained. The
term "successors and assigns" shall not include a purchaser, in its capacity as
such, of Notes from the Initial Purchasers.

     13. Construction. This Agreement shall be construed in accordance with the
internal laws of the State of New York.

     14. Captions. The captions included in this Agreement are included solely
for convenience of reference and are not to be considered a part of this
Agreement.

     15. Counterparts. This Agreement may be executed in various counterparts
which together shall constitute one and the same instrument.




                                      -28-



     If the foregoing correctly sets forth the understanding among the Initial
Purchasers, the Company and the Guarantors please so indicate in the space
provided below for that purpose, whereupon this letter shall constitute a
binding agreement among us.


                         Very truly yours,

                         VAIL RESORTS, INC.


                         By: /s/ Martha D. Rehm
                             ------------------------------------
                             Name: Martha D. Rehm
                             Title:     Senior Vice President


















                 [Purchase Agreement Signature Page for Company]




                                      -29-



                       BEAVER CREEK ASSOCIATES, INC.
                       BEAVER CREEK CONSULTANTS, INC.
                       BEAVER CREEK FOOD SERVICES, INC.
                       BRECKENRIDGE RESORT PROPERTIES, INC.
                       COMPLETE TELECOMMUNICATIONS, INC.
                       GHTV, INC.
                       GILLETT BROADCASTING, INC.
                       GRAND TETON LODGE COMPANY
                       JACKSON HOLE GOLF AND TENNIS CLUB, INC.
                       JHL&S LLC
                       KEYSTONE CONFERENCE SERVICES, INC.
                       KEYSTONE DEVELOPMENT SALES, INC.
                       KEYSTONE FOOD AND BEVERAGE COMPANY
                       KEYSTONE RESORT PROPERTY MANAGEMENT COMPANY
                       LARKSPUR RESTAURANT & BAR, LLC
                       LODGE PROPERTIES, INC.
                       LODGE REALTY, INC.
                       PROPERTY MANAGEMENT ACQUISITION CORP., INC.
                       TETON HOSPITALITY LLC
                       TETON HOSPITALITY SERVICES, INC.
                       THE VAIL CORPORATION
                       THE VILLAGE AT BRECKENRIDGE ACQUISITION CORP., INC.
                       VAIL ASSOCIATES CONSULTANTS, INC.
                       VAIL ASSOCIATES HOLDINGS, LTD.
                       VAIL ASSOCIATES MANAGEMENT COMPANY
                       VAIL ASSOCIATES REAL ESTATE, INC.
                       VAIL FOOD SERVICES, INC.
                       VAIL HOLDINGS, INC.
                       VAIL RESORTS DEVELOPMENT COMPANY
                       VAIL SUMMIT RESORTS, INC.
                       VAIL TRADEMARKS, INC.
                       VAIL/ARROWHEAD, INC.
                       VAIL/BATTLE MOUNTAIN, INC.
                       VAIL/BEAVER CREEK RESORT PROPERTIES, INC.
                       VAMHC, INC.
                       VAIL RR, INC.
                       VA RANCHO MIRAGE I, INC.
                       VA RANCHO MIRAGE II, INC.

                       Each by its authorized officer:

                       By: /s/ Martha D. Rehm
                           --------------------------------------------------
                             Name: Martha D. Rehm
                             Title:   Senior Vice President of each Guarantor
                                      listed above



               [Purchase Agreement Signature Page for Guarantors]



                                      -30-




Accepted and agreed to as of the date first above written:

DEUTSCHE BANC ALEX. BROWN INC.

By:  /s/ Scott Tolchin
     --------------------------------
     Name:   Scott Tolchin
     Title:  Managing Director

BANC OF AMERICA SECURITIES LLC

By:  /s/ Diane Scott
     --------------------------------
     Name:   Diane Scott
     Title:  Vice President

BEAR, STEARNS & CO. INC.

By:  /s/ John Kilgallon
     --------------------------------
     Name:   John Kilgallon
     Title:  SMD

CIBC WORLD MARKETS CORP.

By:  /s/ Brian Gerson
     --------------------------------
     Name:   Brian Gerson
     Title:  Managing Director

FLEET SECURITIES, INC.

By:  /s/ Brad Stewart
     --------------------------------
     Name:   Brad Stewart
     Title:  Vice President





           [Purchase Agreement Signature Page for Initial Purchasers]




                                      -31-



                                   SCHEDULE I

                                   Guarantors

Beaver Creek Associates, Inc.
Beaver Creek Consultants, Inc.
Beaver Creek Food Services, Inc.
Breckenridge Resort Properties, Inc.
Complete Telecommunications, Inc.
GHTV, Inc.
Gillett Broadcasting, Inc.
Grand Teton Lodge Company
Jackson Hole Golf and Tennis Club, Inc.
JHL&S LLC
Keystone Conference Services, Inc.
Keystone Development Sales, Inc.
Keystone Food and Beverage Company
Keystone Resort Property Management Company
Larkspur Restaurant & Bar, LLC
Lodge Properties, Inc.
Lodge Realty, Inc.
Property Management Acquisition Corp., Inc.
Teton Hospitality LLC
Teton Hospitality Services, Inc.
The Vail Corporation
The Village at Breckenridge Acquisition Corp., Inc.
Vail Associates Consultants, Inc.
Vail Associates Holdings, Ltd.
Vail Associates Management Company
Vail Associates Real Estate, Inc.
Vail Food Services, Inc.
Vail Holdings, Inc.
Vail Resorts Development Company
Vail Summit Resorts, Inc.
Vail Trademarks, Inc.
Vail/Arrowhead, Inc.
Vail/Battle Mountain, Inc.
Vail/Beaver Creek Resort Properties, Inc.
VAMHC, Inc.
Vail RR, Inc.
VA Rancho Mirage I, Inc.
VA Rancho Mirage II, Inc.



                                      -32-



                                   SCHEDULE II
                               Initial Purchasers


Initial Purchasers                                         Principal Amount

Deutsche Banc Alex. Brown Inc....................................72,000,000

Banc of America Securities LLC...................................40,000,000

Bear, Stearns & Co. Inc..........................................16,000,000

CIBC World Markets Corp..........................................16,000,000

Fleet Securities, Inc............................................16,000,000

         Total ................................................$160,000,000
                                                                ===========



                                      -33-



                                  SCHEDULE III

Material Domestic Subsidiaries of the Company(1)

Owned Directly by Vail Resorts, Inc.

         GHTV, Inc.
         Gillett Broadcasting, Inc.
         Vail Holdings, Inc.


Owned Directly by Vail Holdings, Inc.

         The Vail Corporation


Owned Directly by The Vail Corporation

         Beaver Creek Associates, Inc.
         Beaver Creek Consultants, Inc.
         Lodge Properties, Inc.
         SSI Venture, LLC
         Vail Associates Investments, Inc.
         Vail Food Services, Inc.
         Vail Resorts Development Company
         Vail Summit Resorts, Inc.
         Vail Trademarks, Inc.
         Vail/Arrowhead, Inc.
         Vail/Beaver Creek Resort Properties, Inc.
         Complete Telecommunications, Inc.
         Forest Ridge Holdings, Inc.
         Grand Teton Lodge Company
         Larkspur Restaurant & Bar, LLC
         Resort Technology Partners, LLC
         Teton Hospitality Services, Inc.
         VAMHC, Inc.
         VA Rancho Mirage I, Inc.
         VA Rancho Mirage II, Inc.
         Avon Partners II, LLC
         Eagle Park Reservoir Company
         Vail RR, Inc.

- ----------

1    Those owned 50% or greater


                                      -34-



Owned Directly by Beaver Creek Associates, Inc.

         Beaver Creek Food Services, Inc.


Owned Directly by Beaver Creek Food Services, Inc.

         Boulder/Beaver, LLC

Owned Directly by Grand Teton Lodge Company

         Colter Bay Corporation
         Gros Ventre Utility Company
         Jackson Hole Golf and Tennis Club, Inc.
         Jackson Lake Lodge Corporation
         Jenny Lake Lodge, Inc.

Owned Directly by Lodge Properties, Inc.

         Lodge Realty, Inc.


Owned Directly by Resort Technology Partners, LLC

         RT Partners, Inc.


Owned Directly by Teton Hospitality Services, Inc.

         Teton Hospitality LLC


Owned Directly by Teton Hospitality LLC

         JHL&S LLC

Owned Directly by Vail/Arrowhead, Inc. and Vail Summit Resorts, Inc.

         VR Holdings, Inc.

Owned Directly by VR Holdings, Inc.

         Mountain Thunder, Inc.


Owned Directly by Vail Resorts Development Company

         Breckenridge Resort Properties, Inc.


                                      -35-


         Vail Associates Consultants, Inc.
         Vail Associates Holdings, Ltd.
         Vail Associates Management Company
         Vail Associates Real Estate, Inc.


Owned Directly by Vail Associates Real Estate, Inc.

         Slifer Smith & Frampton/Vail Associates Real Estate, LLC
         Vail/Battle Mountain, Inc.


Owned Directly by Vail Summit Resorts, Inc.

         Breckenridge Terrace, LLC
         Tenderfoot Seasonal Housing, LLC
         Keystone Conference Services, Inc.
         Keystone Development Sales, Inc.
         Keystone Food and Beverage Company
         Keystone/Intrawest, LLC
         Keystone Resort Property Management Company
         Property Management Acquisition Corp., Inc.
         The Village at Breckenridge Acquisition Corp., Inc.


Owned Directly by Vail RR, Inc.

         Rockresorts International, LLC

Owned Directly by Rockresorts International, LLC

         Rockresorts LLC
         Rockresorts Cheeca, LLC
         Rockresorts Equinox, Inc.
         Rockresorts LaPosada, LLC
         Rockresorts Casa Madrona, LLC
         Rockresorts Rosario, LLC

Owned Directly by VA Rancho Mirage I, Inc. and by
VA Rancho Mirage II, Inc.

         VA Rancho Mirage Resort L.P.




                                      -36-



                                   SCHEDULE IV

             Subsidiaries and Other Equity Interests of the Company

               Owned Directly by Vail Resorts, Inc.
- --------------------------------------------------------------------------------
Subsidiary                     % Owned      State of           Qualified to do
                                            Incorporation      Business in
- --------------------------------------------------------------------------------
GHTV, Inc.                     100%         Delaware           California
- --------------------------------------------------------------------------------
Gillett Broadcasting, Inc.     100%         Delaware          --
- --------------------------------------------------------------------------------
Vail Holdings, Inc.            100%         Colorado          --
- --------------------------------------------------------------------------------

               Owned Directly by Vail Holdings, Inc.
- --------------------------------------------------------------------------------
Subsidiary                     % Owned      State of           Qualified to do
                                            Incorporation      Business in
- --------------------------------------------------------------------------------
The Vail Corporation           100%         Colorado          --
- --------------------------------------------------------------------------------

    Owned Directly by The Vail Corporation
- --------------------------------------------------------------------------------
Subsidiary                            % Owned   State of         Qualified to do
                                                Incorporation    Business in
- --------------------------------------------------------------------------------
Avon Partners II, LLC                 50%       Colorado        --
- --------------------------------------------------------------------------------
Beaver Creek Associates, Inc.         100%      Colorado        --
- --------------------------------------------------------------------------------
Beaver Creek Consultants, Inc.        100%      Colorado        --
- --------------------------------------------------------------------------------
BC Housing, LLC                       49%       Colorado        --
- --------------------------------------------------------------------------------
Complete Telecommunications, Inc.     100%      Colorado        --
- --------------------------------------------------------------------------------
Eagle Park Reservoir Company          55%       Colorado        --
- --------------------------------------------------------------------------------
Eclipse Television and Sports         25%       Colorado        --
Marketing, LLC
- --------------------------------------------------------------------------------
Forest Ridge Holdings, Inc.           100%      Colorado        --
- --------------------------------------------------------------------------------
Grand Teton Lodge Company             100%      Wyoming         --
- --------------------------------------------------------------------------------
Larkspur Restaurant & Bar, LLC        83%       Colorado        --
- --------------------------------------------------------------------------------
Lodge Properties, Inc.                100%      Colorado        --
- --------------------------------------------------------------------------------
Lowther Limited                       49%       Republic of     --
                                                Ireland
- --------------------------------------------------------------------------------
Resort Technology Partners, LLC       51%       Colorado        --
- --------------------------------------------------------------------------------
SSI Venture, LLC                      52%       Colorado        --
- --------------------------------------------------------------------------------
The Tarnes at BC, LLC                 31%       Colorado        --
- --------------------------------------------------------------------------------


                           -37-


Teton Hospitality Services, Inc.      100%         Wyoming     --
- --------------------------------------------------------------------------------
Vail Associates Investments, Inc.     100%         Colorado    --
- --------------------------------------------------------------------------------
Vail Food Services, Inc.              100%         Colorado    --
- --------------------------------------------------------------------------------
Vail Resorts Development Company      100%         Colorado     Wyoming
- --------------------------------------------------------------------------------
Vail Summit Resorts, Inc.             100%         Colorado    --
- --------------------------------------------------------------------------------
Vail Trademarks, Inc.                 100%         Colorado    --
- --------------------------------------------------------------------------------
Vail/Arrowhead, Inc.                  100%         Colorado    --
- --------------------------------------------------------------------------------
Vail/Beaver Creek Resort              100%         Colorado    --
Properties, Inc.
- --------------------------------------------------------------------------------
VAMHC, Inc.                           100%         Colorado    --
- --------------------------------------------------------------------------------
Vail RR, Inc.                         100%         Colorado    --
- --------------------------------------------------------------------------------
VA Rancho Mirage I, Inc.              100%         Colorado    --
- --------------------------------------------------------------------------------
VA Rancho Mirage II, Inc.             100%         Colorado    --
- --------------------------------------------------------------------------------

    Owned Directly by Beaver Creek Associates, Inc.
- --------------------------------------------------------------------------------
Subsidiary                        % Owned      State of         Qualified to do
                                               Incorporation    Business in
- --------------------------------------------------------------------------------
Beaver Creek Food Services, Inc.  100%         Colorado        --
- --------------------------------------------------------------------------------

               Owned Directly by Beaver Creek Food Services, Inc.
- --------------------------------------------------------------------------------
Subsidiary                       % Owned      State of          Qualified to do
                                              Incorporation     Business in
- --------------------------------------------------------------------------------
Boulder/Beaver, LLC              97%          Colorado         --
- --------------------------------------------------------------------------------


                                      -38-



               Owned Directly by Grand Teton Lodge Company
- --------------------------------------------------------------------------------
Subsidiary                            % Owned   State of         Qualified to do
                                                Incorporation    Business in
- --------------------------------------------------------------------------------
Colter Bay Corporation                100%      Wyoming         --
- --------------------------------------------------------------------------------
Gros Ventre Utility Company           100%      Wyoming         --
- --------------------------------------------------------------------------------
Jackson Hole Golf and Tennis Club,    100%      Wyoming         --
Inc.
- --------------------------------------------------------------------------------
Jackson Lake Lodge Corporation        100%      Wyoming         --
- --------------------------------------------------------------------------------
Jenny Lake Lodge, Inc.                100%      Wyoming         --
- --------------------------------------------------------------------------------


               Owned Directly by Lodge Properties, Inc.
- --------------------------------------------------------------------------------
Subsidiary               % Owned      State of               Qualified to do
                                      Incorporation          Business in
- --------------------------------------------------------------------------------
Lodge Realty, Inc.       100%         Colorado              --
- --------------------------------------------------------------------------------

               Owned Directly by Resort Technology Partners, LLC
- --------------------------------------------------------------------------------
Subsidiary               % Owned      State of               Qualified to do
                                      Incorporation          Business in
- ------------------------------------------------------------------------------
RT Partners, Inc.        100%         Delaware               Colorado
- ------------------------------------------------------------------------------

               Owned Directly by  Teton Hospitality Services, Inc.
- --------------------------------------------------------------------------------
Subsidiary               % Owned      State of               Qualified to do
                                      Incorporation          Business in
- -------------------------------------------------------------------------------
Teton Hospitality LLC    100%         Wyoming               --
- -------------------------------------------------------------------------------

               Owned Directly by  Teton Hospitality LLC
- --------------------------------------------------------------------------------
Subsidiary               % Owned      State of               Qualified to do
                                      Incorporation          Business in
- ------------------------------------------------------------------------------
JHL&S LLC                51%          Wyoming               --
- -----------------------------------------------------------------------------

      Owned Directly by Vail/Arrowhead, Inc. and Vail Summit Resorts, Inc.
- --------------------------------------------------------------------------------
Subsidiary               % Owned      State of               Qualified to do
                                      Incorporation          Business in
- -------------------------------------------------------------------------------
VR Holdings, Inc.        100%         Colorado              --
- -------------------------------------------------------------------------------

               Owned Directly by  VR Holdings, Inc.
- --------------------------------------------------------------------------------
Subsidiary               % Owned      State of               Qualified to do
                                      Incorporation          Business in
- --------------------------------------------------------------------------------
Bachelor Gulch Resort LLC             49%          Colorado              --
- --------------------------------------------------------------------------------
Mountain Thunder, Inc.                100%         Colorado              --
- --------------------------------------------------------------------------------

                                      -39-



                Owned Directly by Vail Resorts Development Company
- --------------------------------------------------------------------------------
Subsidiary                            % Owned  State of        Qualified to do
                                               Incorporation   Business in
- --------------------------------------------------------------------------------
Breckenridge Resort Properties, Inc.  100%     Colorado       --
- --------------------------------------------------------------------------------
Vail Associates Consultants, Inc.     100%     Colorado       --
- --------------------------------------------------------------------------------
Vail Associates Holdings, Ltd.        100%     Colorado       --
- --------------------------------------------------------------------------------
Vail Associates Management Company    100%     Colorado       --
- --------------------------------------------------------------------------------
Vail Associates Real Estate, Inc.     100%     Colorado       --
- --------------------------------------------------------------------------------

               Owned Directly by Vail Associates Real Estate, Inc.
- --------------------------------------------------------------------------------
Subsidiary                            % Owned  State of         Qualified to do
                                               Incorporation    Business in
- --------------------------------------------------------------------------------
Slifer, Smith & Frampton/Vail         50%      Colorado        --
Associates Real Estate, LLC
- --------------------------------------------------------------------------------
Vail/Battle Mountain, Inc.            100%     Colorado        --
- --------------------------------------------------------------------------------

               Owned Directly by Vail Summit Resorts, Inc.
- --------------------------------------------------------------------------------
Subsidiary                            % Owned   State of        Qualified to do
                                                Incorporation   Business in
- --------------------------------------------------------------------------------
Breckenridge Terrace, LLC             50%       Colorado       --
- --------------------------------------------------------------------------------
Clinton Ditch and Reservoir Company   43%       Colorado       --
- --------------------------------------------------------------------------------
Keystone Conference Services, Inc.    100%      Colorado       --
- --------------------------------------------------------------------------------
Keystone Development Sales, Inc.      100%      Colorado       --
- --------------------------------------------------------------------------------
Keystone Food and Beverage Company    100%      Colorado       --
- --------------------------------------------------------------------------------
Keystone/Intrawest, LLC               50%       Delaware       --
- --------------------------------------------------------------------------------
Keystone Resort Property Management   100%      Colorado       --
Company
- --------------------------------------------------------------------------------
Tenderfoot Seasonal Housing, LLC      50%       Colorado       --
- --------------------------------------------------------------------------------
Property Management Acquisition       100%      Tennessee       Colorado
Corp., Inc.
- --------------------------------------------------------------------------------
The Village at Breckenridge           100%      Tennessee       Colorado
Acquisition Corp., Inc.
- --------------------------------------------------------------------------------

                                      -40-



               Owned Directly by  Vail RR, Inc.
- -------------------------------------------------------------------------------
Subsidiary                         % Owned    State of        Qualified to do
                                              Incorporation   Business in
- --------------------------------------------------------------------------------
Rockresorts International, LLC     100%       Delaware        California,
                                   (Class A)                  Colorado, Florida,
                                                              New Mexico,
                                                                 Vermont,
                                                                 Washington
- --------------------------------------------------------------------------------

               Owned Directly by  Rockresorts International, LLC
- --------------------------------------------------------------------------------
Subsidiary                       % Owned   State of          Qualified to do
                                           Incorporation     Business in
- --------------------------------------------------------------------------------
Rockresorts LLC                  100%      Delaware         --
- --------------------------------------------------------------------------------
Rockresorts Cheeca, LLC          100%      Delaware          Florida
- --------------------------------------------------------------------------------
Rockresorts Equinox, Inc.        100%      Vermont          --
- --------------------------------------------------------------------------------
Rockresorts LaPosada, LLC        100%      Delaware          New Mexico
- --------------------------------------------------------------------------------
Rockresorts Casa Madrona, LLC    100%      Delaware          California
- --------------------------------------------------------------------------------
Rockresorts Rosario, LLC         100%      Delaware          Washington
- --------------------------------------------------------------------------------

    Owned Directly by VA Rancho Mirage I, Inc. and VA Rancho Mirage II, Inc.
- --------------------------------------------------------------------------------
Subsidiary                       % Owned   State of          Qualified to do
                                           Incorporation     Business in
- --------------------------------------------------------------------------------
VA Rancho Mirage Resort, L.P.    100%      Delaware          California
- --------------------------------------------------------------------------------


                                      -41-

                                                                     Exhibit 4.2

                                                                  EXECUTION COPY









                              VAIL RESORTS, INC.,

                                   as Issuer

                          THE GUARANTORS NAMED HEREIN,

                                 as Guarantors

                             THE BANK OF NEW YORK,

                                   as Trustee

                   8 3/4% SENIOR SUBORDINATED NOTES DUE 2009



                                   INDENTURE

                         Dated as of November 21, 2001









                               TABLE OF CONTENTS

ARTICLE 1         DEFINITIONS AND INCORPORATION BY REFERENCE ............... 1
SECTION 1.01.  Definitions ................................................. 1
SECTION 1.02.  Other Definitions ...........................................19
SECTION 1.03.  Incorporation by Reference of Trust Indenture Act ...........19
SECTION 1.04.  Rules of Construction .......................................20
SECTION 1.05.  Compliance Certificates and Opinions ........................20
SECTION 1.06.  Form of Documents Delivered to Trustee ......................21
SECTION 1.07.  Acts of Holders .............................................21

ARTICLE 2         THE NOTES ................................................23
SECTION 2.01.  Form and Dating .............................................23
SECTION 2.02.  Execution and Authentication ................................24
SECTION 2.03.  Registrar and Paying Agent ..................................24
SECTION 2.04.  Paying Agent to Hold Assets in Trust ........................25
SECTION 2.05.  Holder Lists ................................................25
SECTION 2.06.  Transfer and Exchange .......................................25
SECTION 2.07.  Replacement Notes ...........................................39
SECTION 2.08.  Outstanding Notes ...........................................39
SECTION 2.09.  Treasury Notes ..............................................40
SECTION 2.10.  Temporary Notes .............................................40
SECTION 2.11.  Cancellation ................................................40
SECTION 2.12.  Defaulted Interest ..........................................40
SECTION 2.13.  CUSIP Number ................................................41
SECTION 2.14.  Deposit of Moneys ...........................................41
SECTION 2.15.  Issuance of Additional Notes ................................41

ARTICLE 3         REDEMPTION AND OFFERS TO PURCHASE ........................42
SECTION 3.01.  Applicability of Article ....................................42
SECTION 3.02.  Election to Redeem; Notice to Trustee .......................42
SECTION 3.03.  Selection of Notes to Be Redeemed ...........................42
SECTION 3.04.  Notice of Redemption ........................................43
SECTION 3.05.  Deposit of Redemption Price .................................44
SECTION 3.06.  Notes Payable on Redemption Date ............................44
SECTION 3.07.  Notes Redeemed in Part ......................................44
SECTION 3.08.  Optional Redemption .........................................45
SECTION 3.09.  Mandatory Redemption ........................................45
SECTION 3.10.  Offer to Purchase by Application of Excess Proceeds .........45

ARTICLE 4         COVENANTS ................................................47
SECTION 4.01.  Payment of Notes ............................................47
SECTION 4.02.  Maintenance of Office or Agency .............................48
SECTION 4.03.  Money for Security Payments to be Held in Trust .............48
SECTION 4.04.  Reports .....................................................50
SECTION 4.05.  Compliance Certificate ......................................50
SECTION 4.06.  Taxes .......................................................51
SECTION 4.07.  Stay, Extension and Usury Laws ..............................51

                                      -i-

                                                                            Page
                                                                            ----

SECTION 4.08.  Corporate Existence; Maintenance of Properties and Insurance .51
SECTION 4.09.  Limitation on the Incurrence of Indebtedness and Issuance
                 of Preferred Stock .........................................52
SECTION 4.10.  Limitation on Restricted Payments ............................54
SECTION 4.11.  Limitation on Liens ..........................................57
SECTION 4.12.  Limitation on Transactions with Affiliates ...................57
SECTION 4.13.  Limitation on Dividend and Other Payment Restrictions
                 Affecting Subsidiaries .....................................58
SECTION 4.14.  Limitation on Layering Debt ..................................59
SECTION 4.15.  Payments for Consent .........................................59
SECTION 4.16.  Asset Sales ..................................................59
SECTION 4.17.  Offer to Repurchase Upon Change of Control ...................60
SECTION 4.18.  Additional Subsidiary Guarantees .............................62

ARTICLE 5         SUCCESSORS ................................................63
SECTION 5.01.  Limitation on Merger, Consolidation or Sale of Assets ........63
SECTION 5.02.  Successor Person Substituted .................................63

ARTICLE 6         DEFAULTS AND REMEDIES .....................................64
SECTION 6.01.  Events of Default ............................................64
SECTION 6.02.  Acceleration of Maturity .....................................66
SECTION 6.03.  Other Remedies ...............................................66
SECTION 6.04.  Waiver of Past Defaults ......................................66
SECTION 6.05.  Control by Majority ..........................................67
SECTION 6.06.  Limitation on Suits ..........................................67
SECTION 6.07.  Rights of Holders to Receive Payment .........................67
SECTION 6.08.  Collection Suit by Trustee ...................................68
SECTION 6.09.  Trustee May File Proofs of Claim .............................68
SECTION 6.10.  Priorities ...................................................68
SECTION 6.11.  Undertaking for Costs ........................................69

ARTICLE 7         TRUSTEE ...................................................69
SECTION 7.01.  Duties of Trustee ............................................69
SECTION 7.02.  Rights of Trustee ............................................70
SECTION 7.03.  Individual Rights of Trustee .................................72
SECTION 7.04.  Trustee's Disclaimer .........................................72
SECTION 7.05.  Notice of Defaults ...........................................72
SECTION 7.06.  Reports by Trustee to Holders of Notes .......................72
SECTION 7.07.  Compensation and Indemnity ...................................72
SECTION 7.08.  Replacement of Trustee .......................................74
SECTION 7.09.  Successor Trustee by Merger, etc. ............................75
SECTION 7.10.  Eligibility; Disqualification ................................75
SECTION 7.11.  Preferential Collection of Claims Against Company ............75

ARTICLE 8         LEGAL DEFEASANCE AND COVENANT DEFEASANCE ..................76
SECTION 8.01.  Option to Effect Legal Defeasance or Covenant Defeasance .....76
SECTION 8.02.  Legal Defeasance and Discharge ...............................76
SECTION 8.03.  Covenant Defeasance ..........................................76


                                      -ii-

                                                                            Page
                                                                            ----

SECTION 8.04.  Conditions to Legal Defeasance or Covenant Defeasance ........77
SECTION 8.05.  Deposited Money and Government Securities to be Held in
                 Trust; Other Miscellaneous Provisions ......................78
SECTION 8.06.  Repayment to Company .........................................79
SECTION 8.07.  Reinstatement ................................................79

ARTICLE 9         AMENDMENTS ................................................79
SECTION 9.01.  Without Consent of Holders ...................................79
SECTION 9.02.  With Consent of Holders ......................................80
SECTION 9.03.  Compliance with Trust Indenture Act ..........................81
SECTION 9.04.  Revocation and Effect of Consents ............................82
SECTION 9.05.  Notation on or Exchange of Notes .............................82
SECTION 9.06.  Trustee to Sign Amendments, etc. .............................82

ARTICLE 10        SUBORDINATION .............................................82
SECTION 10.01.  Agreement to Subordinate ....................................82
SECTION 10.02.  Liquidation; Dissolution; Bankruptcy ........................83
SECTION 10.03.  Default on Designated Senior Debt ...........................83
SECTION 10.04.  Acceleration of Notes .......................................84
SECTION 10.05.  When Distribution Must be Paid Over .........................84
SECTION 10.06.  Notice by Company ...........................................85
SECTION 10.07.  Subrogation .................................................85
SECTION 10.08.  Relative Rights .............................................85
SECTION 10.09.  Subordination May Not be Impaired by Company ................86
SECTION 10.10.  Distribution or Notice to Representative ....................86
SECTION 10.11.  Rights of Trustee and Paying Agent ..........................86
SECTION 10.12.  Authorization to Effect Subordination .......................87

ARTICLE 11        SATISFACTION AND DISCHARGE ................................87
SECTION 11.01.  Satisfaction and Discharge of Indenture .....................87
SECTION 11.02.  Application of Trust Money ..................................88

ARTICLE 12        SUBSIDIARY GUARANTEES .....................................88
SECTION 12.01.  Subsidiary Guarantee ........................................88
SECTION 12.02.  Obligation of the Guarantors Unconditional ..................88
SECTION 12.03.  Waiver Relating to Subsidiary Guarantees ....................89
SECTION 12.04.  Subordination of Subsidiary Guarantees ......................89
SECTION 12.05.  Guarantors May Consolidate, etc., on Certain Terms ..........90
SECTION 12.06.  Release of Subsidiary Guarantee .............................90
SECTION 12.07.  Contribution of Guarantors ..................................91
SECTION 12.08.  Reinstatement of Subsidiary Guarantees ......................91

ARTICLE 13        MISCELLANEOUS .............................................91
SECTION 13.01.  Trust Indenture Act Controls ................................91
SECTION 13.02.  Notices .....................................................92
SECTION 13.03.  Communication by Holders with Other Holders .................93
SECTION 13.04.  Certificate and Opinion as to Conditions Precedent ..........93
SECTION 13.05.  Rules by Trustee and Agents .................................93
SECTION 13.06.  Legal Holidays ..............................................93


                                      -iii-

                                                                            Page
                                                                            ----

SECTION 13.07.  No Personal Liability of Directors, Officers, Employees,
                  Incorporators and Stockholders ............................93
SECTION 13.08.  Governing Law; Submission to Jurisdiction ...................94
SECTION 13.09.  No Adverse Interpretation of Other Agreements ...............94
SECTION 13.10.  Successors and Assigns ......................................94
SECTION 13.11.  Severability ................................................94
SECTION 13.12.  Counterpart Originals .......................................94
SECTION 13.13.  Table of Contents, Headings, etc. ...........................94



EXHIBITS

Exhibit A       Form of Note
Exhibit B       Form of Certificate of Transfer
Exhibit C       Form of Certificate of Exchange
Exhibit D       Form of Certificate from Acquiring Institutional
                Accredited Investor












                                      -iv-





                             CROSS-REFERENCE TABLE*

Trust Indenture    Act Section                                Indenture Section

310(a)(1) ............................................................. 7.10
   (a)(2) ............................................................. 7.10
   (a)(3) ............................................................. N.A.
   (a)(4) ............................................................. N.A.
   (a)(5) ............................................................. 7.10
   (b) .......................................................... 7.08, 7.10
   (c) ................................................................ N.A.
311(a) ................................................................ 7.11
   (b) ................................................................ 7.11
   (c) ................................................................ N.A.
312(a) ................................................................ 2.05
   (b) ................................................................13.03
   (c) ................................................................13.03
313(a) ................................................................ 7.06
   (b)(1) ............................................................. N.A.
   (b)(2) ....................................................... 7.06; 7.07
   (c) ................................................................ 7.06
   (d) ................................................................ 7.06
314(a) .......................................................... 4.04, 4.05
   (b) ................................................................ N.A.
   (c)(1) .............................................................13.04
   (c)(2) .............................................................13.04
   (c)(3) ............................................................. N.A.
   (d) ................................................................ N.A.
   (e) ................................................................ 1.05
   (f) ................................................................ N.A.
315(a) ................................................................ 7.01
   (b) .......................................................... 7.05;13.02
   (c) ................................................................ 7.01
   (d) ................................................................ 7.01
   (e) ................................................................ 6.11
316(a)(last sentence) ................................................. 2.09
   (a)(1)(A) .......................................................... 6.05
   (a)(1)(B) .......................................................... 6.04
   (a)(2) ............................................................. N.A.
   (b) ................................................................ 6.07
   (c) ................................................................ 1.07
317(a)(1) ............................................................. 6.08
   (a)(2) ............................................................. 6.09
   (b) ................................................................ 2.04
318(a) ................................................................13.01
   (b) ................................................................ N.A.
   (c) ................................................................13.01

N.A. means not applicable.
*This Cross-Reference Table is not part of the Indenture.



                                       -v-





     INDENTURE, dated as of November 21, 2001, among VAIL RESORTS, INC., a
Delaware corporation (the "Company"), as Issuer, the Guarantors named on the
signature pages hereto, as Guarantors, and The Bank of New York, a New York
banking corporation, as trustee (the "Trustee").

     The Company, the Guarantors and the Trustee agree as follows for the
benefit of each other and for the equal and ratable benefit of the Holders of
the 8 3/4% Senior Subordinated Notes due 2009 of the Company (the "Notes").

                                   ARTICLE 1

                   DEFINITIONS AND INCORPORATION BY REFERENCE

SECTION 1.01. Definitions

     "144A Global Note" means a global note substantially in the form of Exhibit
A hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with or on behalf of, and registered in the name of, the Depositary or
its nominee that will be issued in a denomination equal to the initial
outstanding principal amount of the Notes sold in reliance on Rule 144A.

     "Acquired Debt" means, with respect to any specified Person, (i)
Indebtedness or preferred stock of any other Person existing at the time such
other Person is merged with or into or became a Subsidiary of such specified
Person, including, without limitation, Indebtedness or preferred stock incurred
in connection with, or in contemplation of, such other Person merging with or
into or becoming a Subsidiary of such specified Person, and (ii) Indebtedness
secured by a Lien encumbering any asset acquired by such specified Person.

     "Additional Notes" means, subject to the Company's compliance with Section
4.09 hereof, 8 3/4% Senior Subordinated Notes due 2009 issued from time to time
after November 21, 2001, under the terms of this Indenture (other than those
issued pursuant to Sections 2.06, 2.07, 2.10, 3.07, 3.10, 4.17 or 9.05 of this
Indenture and other than Exchange Notes issued pursuant to an Exchange Offer for
other Notes outstanding under this Indenture).

     "Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise.

     "Agent" means any Registrar or Paying Agent.

     "Agent Members" means members of, or participants in, the Depositary.




     "Applicable Procedures" means, with respect to any transfer or exchange of
or for beneficial interest in any Global Note, the rule and regulations and
procedures of the Depositary that apply to such transfer or exchange.

     "Apollo" means Apollo Ski Partners, an indirect subsidiary of Apollo
Advisors, L.P., a Delaware limited partnership.

     "Asset Sale" means (i) the sale, lease, conveyance or other disposition
(collectively, "dispositions") of any assets or rights (including, without
limitation, by way of a Sale and Leaseback Transaction), other than dispositions
of inventory or sales or leases of real estate constituting Real Estate Held for
Sale in the ordinary course of business, and (ii) the issuance of Equity
Interests by any Restricted Subsidiary or the disposition by the Company or a
Restricted Subsidiary of Equity Interests in any of the Company's Restricted
Subsidiaries (other than directors' qualifying shares or shares required by
applicable law to be held by a Person other than the Company or a Restricted
Subsidiary of the Company), in the case of either clause (i) or (ii), whether in
a single transaction or a series of related transactions (a) that have a fair
market value in excess of $3.0 million or (b) for net proceeds in excess of $3.0
million. Notwithstanding the foregoing, the following will be deemed not to be
Asset Sales: (i) a transfer of assets by the Company to a Restricted Subsidiary
or by a Restricted Subsidiary to the Company or to another Restricted
Subsidiary; (ii) an issuance of Equity Interests by a Restricted Subsidiary to
the Company or to another Restricted Subsidiary; (iii) a Permitted Investment or
Restricted Payment that is permitted by Section 4.10 hereof; (iv) a disposition
of Cash Equivalents solely for cash or other Cash Equivalents; (v) a disposition
in the ordinary course of business of used, worn-out, obsolete, damaged or
replaced equipment; (vi) the grant of licenses to third parties in respect of
intellectual property in the ordinary course of business of the Company or any
of its Restricted Subsidiaries, as applicable; (vii) any disposition of
properties or assets that is governed by Section 4.17 hereof or Section 5.01
hereof; and (viii) the granting or incurrence of any Permitted Lien.

     "Bankruptcy Law" means Title 11, U.S. Code or any similar foreign, federal
or state law for the relief of debtors, as amended.

     "Board of Directors" means, with respect to any Person, the board of
directors of such Person, or any duly authorized committee of such board of
directors.

     "Board Resolution" means a duly adopted resolution of the Board of
Directors of the Company in full force and effect at the time of determination
and certified as such by the Secretary or an Assistant Secretary of the Company
and delivered to the Trustee.

     "Broker-Dealer" has the meaning set forth in the Registration Rights
Agreement.

     "Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday
that is not a day on which banking institutions in The City of New York are
authorized or obligated by law, regulation or executive order to close.

     "Capital Lease Obligation" means, at the time any determination thereof is
to be made, the amount of the liability in respect of a capital lease that would
at such time be required to be capitalized on a balance sheet in accordance with
GAAP.



                                      -2-


     "Capital Stock" means (i) in the case of a corporation, corporate stock,
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
corporate stock, (iii) in the case of a partnership or limited liability
company, partnership or membership interests (whether general or limited) and
(iv) any other interest or participation that confers on a Person the right to
receive a share of the profits and losses of, or distributions of assets of, the
issuing Person.

     "Cash Equivalents" means (a) marketable obligations issued or
unconditionally guaranteed by the U.S. or issued by any of its agencies and
backed by the full faith and credit of the U.S., in each case maturing within
one year from the date of acquisition; (b) short-term investment grade domestic
and eurodollar certificates of deposit or time deposits that are fully insured
by the Federal Deposit Insurance Corporation or are issued by commercial banks
organized under the laws of the U.S. or any of its states having combined
capital, surplus, and undivided profits of not less than $100,000,000 (as shown
on its most recently published statement of condition); (c) commercial paper and
similar obligations rated "P-1" by Moody's Investors Service, Inc. ("Moody's")
or "A-1" by Standard & Poor's Rating Services, a division of The McGraw-Hill
Companies, Inc. ("S & P"); (d) readily marketable tax-free municipal bonds of
domestic issuer rated "A-2" or better by Moody's or "A" or better by S&P, and
maturing within one year from the date of issuance; and (e) mutual funds or
money market accounts investing primarily in items described in clauses (a)
through (d) above.

     "Cedel" means Cedel Bank, societe anonyme.

     "Change of Control" means, with respect to the Company or any successor
Person permitted under Article 5 hereof, the occurrence of any of the following:
(a) any "person" or "group" (as such terms are used in Sections 13(d) and 14(d)
of the Exchange Act), other than Apollo and its Affiliates, acquires "beneficial
ownership" (as determined in accordance with Rule 13d-3 under the Exchange Act),
directly or indirectly, of more than 50% of the total outstanding shares of
Voting Stock except to the extent that, and so long as, Apollo and its
affiliates hold the right, by voting power, contract or otherwise, to elect or
designate, and do so elect or designate, a majority of the Company's Board of
Directors; (b) the Company consolidates with or merges into any other
corporation, or conveys, transfers or leases all or substantially all of its
assets to any person, or any other corporation merges into the Company and, in
the case of any such transaction, the outstanding common stock of the Company is
changed or exchanged as a result, unless the shareholders of the Company
immediately before such transaction own, directly or indirectly, at least 51% of
the outstanding shares of Voting Stock of the corporation resulting from such
transaction in substantially the same proportion as their ownership of the
Voting Stock immediately before such transaction (except to the extent that, and
so long as, Apollo and its affiliates hold the right, by voting power or
otherwise, to elect or designate, and do so elect or designate, a majority of
the Board of Directors of the corporation resulting from such transaction); or
(c) the first day on which more than a majority of the members of the Board of
Directors of the Company are not Continuing Directors.

     "Clearstream" means Clearstream Banking, S.A.

     "Closing Date" means November 21, 2001.



                                      -3-


     "Code" means the Internal Revenue Code of 1986, as amended, or any
successor thereto.

     "Company" means Vail Resorts, Inc., a Delaware corporation, and any
successor thereto pursuant to Section 5.01 hereof.

     "Company Request" or "Company Order" means a written request or order
signed in the name of the Company (i) by its Chairman, a Vice Chairman, its
President, Senior Vice President or a Vice President and (ii) by its Treasurer,
an Assistant Treasurer, its Secretary or an Assistant Secretary and delivered to
the Trustee; provided, however, that such written request or order may be signed
by any two of the officers or directors listed in clause (i) above in lieu of
being signed by one of such officers or directors listed in such clause (i) and
one of the officers listed in clause (ii) above.

     "Consolidated EBITDA" means, with respect to any Person for any period, the
Consolidated Net Income of such Person for such period plus, to the extent
deducted in computing such Consolidated Net Income, (i) an amount equal to any
extraordinary loss plus any net loss realized in connection with an Asset Sale,
(ii) provision for taxes based on income or profits of such Person and its
Restricted Subsidiaries for such period, (iii) Consolidated Interest Expense,
and (iv) depreciation and amortization (including amortization of goodwill and
other intangibles but excluding amortization of prepaid cash expenses that were
paid in a prior period) and other non-cash expenses (excluding any such non-cash
expense to the extent that it represents an accrual of or reserve for cash
expenses in any future period or amortization of a prepaid cash expense that was
paid in a prior period) of such Person and its Restricted Subsidiaries for such
period to the extent that such depreciation, amortization and other non-cash
expenses were deducted in computing such Consolidated Net Income, minus (v)
non-cash items increasing such Consolidated Net Income, in each case, for such
period without duplication on a consolidated basis and determined in accordance
with GAAP.

     "Consolidated Interest Coverage Ratio" means with respect to any Person for
any period, the ratio of the Consolidated Resort EBITDA of such Person for such
period to the Consolidated Interest Expense of such Person and its Restricted
Subsidiaries for such period. In the event that the Company or any of its
Restricted Subsidiaries incurs, assumes, Guarantees, redeems, repays or
otherwise retires any Indebtedness (other than revolving credit borrowings)
subsequent to the commencement of the period for which the Consolidated Interest
Coverage Ratio is being calculated but prior to the date on which the event for
which the calculation of the Consolidated Interest Coverage Ratio is made (the
"Calculation Date"), then the Consolidated Interest Coverage Ratio shall be
calculated giving pro forma effect to such incurrence, assumption, Guarantee,
redemption, repayment or retirement of Indebtedness as if the same had occurred
at the beginning of the applicable four-quarter reference period. In addition,
for purposes of making the computation referred to above, (i) (a) acquisitions
that have been made by the Company or any of its Restricted Subsidiaries,
including through mergers or consolidations and including any related financing
transactions and (b) other transactions consummated by the Company or any of its
Restricted Subsidiaries with respect to which pro forma effect may be given
pursuant to Article 11 of Regulation S-X under the Securities Act, in each case
during the four-quarter reference period or subsequent to such reference period
and on or prior to the Calculation Date shall be deemed to have occurred on the
first day of the four-quarter reference period and Consolidated Resort EBITDA
for such reference period shall be calculated without giving effect



                                      -4-


to clause (iii) of the proviso set forth in the definition of Consolidated Net
Income, (ii) the Consolidated Resort EBITDA attributable to discontinued
operations, as determined in accordance with GAAP, and operations or businesses
disposed of prior to the Calculation Date, shall be excluded and (iii) the
Consolidated Interest Expense attributable to discontinued operations, as
determined in accordance with GAAP, and operations or businesses disposed of
prior to the Calculation Date, shall be excluded, but only to the extent (x)
that the obligations giving rise to such Consolidated Interest Expense will not
be obligations of the referent Person or any of its Restricted Subsidiaries
following the Calculation Date, or (without duplication) (y) such Consolidated
Interest Expense is less than the Consolidated Resort EBITDA attributable to
such discontinued operations for the same period.

     "Consolidated Interest Expense" means with respect to any Person for any
period the sum, without duplication, of (i) the consolidated interest expense of
such Person and its Restricted Subsidiaries for such period, whether paid or
accrued (including, without limitation, amortization of debt issuance costs and
original issue discount, non-cash interest payments, the interest component of
any deferred payment obligations, the interest component of all payments
associated with Capital Lease Obligations, commissions, discounts and other fees
and charges incurred in respect of letter of credit or bankers' acceptance
financings, and net payments (if any) pursuant to Hedging Obligations), (ii) the
consolidated interest expense of such Person and its Restricted Subsidiaries
that was capitalized during such period, (iii) any interest expense for such
period on Indebtedness of another Person that is guaranteed by such Person or
one of its Restricted Subsidiaries or secured by a Lien on assets of such Person
or one of its Restricted Subsidiaries (whether or not such Guarantee or Lien is
called upon), in each case, on a consolidated basis and in accordance with GAAP,
and (iv) any Preferred Stock dividends paid in cash by the Company or any of its
Restricted Subsidiaries to a Person other than the Company or any of its
Restricted Subsidiaries, determined, in each case, on a consolidated basis and
in accordance with GAAP.

     "Consolidated Net Income" means, with respect to any Person for any period,
the aggregate of the Net Income of such Person and its Restricted Subsidiaries
for such period, on a consolidated basis, determined in accordance with GAAP;
provided that (i) the net income (but not loss) of any Person that is not a
Restricted Subsidiary of such Person or that is accounted for by the equity
method of accounting shall be included only to the extent of the amount of
dividends or distributions paid in cash by such Person during such period to the
referent Person or a Restricted Subsidiary thereof, (ii) the net income (but not
loss) of any Restricted Subsidiary shall be excluded to the extent that the
declaration or payment of dividends or similar distributions by that Restricted
Subsidiary of that net income is not at the date of determination permitted by
operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Restricted Subsidiary or its stockholders, (iii) the Net Income of any Person
acquired in a pooling of interests transaction for any period prior to the date
of such acquisition shall be excluded, and (iv) the cumulative effect of a
change in accounting principles shall be excluded.

     "Consolidated Net Worth" means, with respect to any Person as of any date,
the consolidated stockholders' equity of such Person and its consolidated
Restricted Subsidiaries as of such date, less (without duplication) amounts
attributable to Disqualified Stock of such Person, in each case determined in
accordance with GAAP.



                                      -5-


     "Consolidated Resort EBITDA" means, with respect to any Person for any
period, the Consolidated EBITDA of such Person for such period minus
consolidated real estate revenue of such Person and its Restricted Subsidiaries
for such period plus consolidated real estate operating expenses of such Person
and its Restricted Subsidiaries for such period minus any portion of such
Consolidated EBITDA attributable to Unrestricted Subsidiaries of such Person for
such period, in each case as reported on such Person's consolidated statement of
operations and determined on a consolidated basis and in accordance with GAAP.

     "Continuing Directors" means, as of any date of determination, any member
of the Board of Directors of the Company who (i) was a member of such Board of
Directors on May 11, 1999 or (ii) was nominated for election or elected to such
Board of Directors with the approval of a majority of the Continuing Directors
who were members of such Board at the time of such nomination or election.

     "Corporate Trust Office of the Trustee" means the principal corporate trust
office of the Trustee at which at any particular time its corporate trust
business shall be administered, which office at the date of execution of this
Indenture is located at c/o United States Trust Company of New York, 114 West
47th Street, New York, New York 10036.

     "Credit Agreement" means that certain Second Amended and Restated Credit
Agreement, dated as of November 13, 2001, by and among The Vail Corporation, the
Lenders named therein, Bank of America, N.A., as Agent, and Banc of America
Securities LLC, including any related notes, guarantees, collateral documents,
instruments and agreements executed in connection therewith, and in each case,
as amended, restated, modified, renewed, refunded, replaced or refinanced in
whole or in part from time to time.

     "Custodian" means any receiver, trustee, assignee, liquidator or similar
official under any Bankruptcy Law.

     "Default" means any event that is, or with the passage of time or the
giving of notice or both would be, an Event of Default.

     "Definitive Notes" means a certificated Note registered in the name of the
Holder thereof and issued in accordance with Section 2.06 hereof, substantially
in the form of Exhibit A hereto except that such Note shall not bear the Global
Note Legend and shall not have the "Schedule of Exchanges of Interests in the
Global Note" attached thereto.

     "Depositary" means, with respect to any Global Note, the Person specified
in Section 2.03 hereof as the Depositary with respect to such Note, until a
successor shall have been appointed and become such pursuant to the applicable
provision of this Indenture, and, thereafter, "Depositary" shall mean or include
such successor.

     "Designated Senior Debt" of any Person means (i) any Indebtedness of such
Person outstanding under the Credit Agreement and (ii) any other Senior Debt of
such Person, the principal amount of which is $25.0 million or more and that has
been designated by the Company as "Designated Senior Debt" of such Person.



                                      -6-


     "Disqualified Stock" means any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable at the option of the holder), or upon the happening of any event,
matures or is mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise, or redeemable at the option of the holder thereof, in whole or in
part, on or prior to the date that is 91 days after the date on which the Notes
mature; provided, however, that any Capital Stock that would not constitute
Disqualified Stock but for provisions thereof giving holders thereof the right
to require such Person to purchase or redeem such Capital Stock upon the
occurrence of an "asset sale" or "change of control" occurring on or prior to 91
days after the date on which the Notes mature shall not constitute Disqualified
Stock if (1) the "asset sale" or "change of control" provisions applicable to
such Capital Stock are not more favorable in any respect to the holders of such
Capital Stock than the terms applicable to the Notes pursuant to Sections 3.10,
4.16 and 4.17 hereof; and (2) any such requirement only becomes operative after
compliance with such terms applicable to the Notes, including the purchase of
any Notes tendered pursuant thereto.

     "Distribution Compliance Period" has the meaning set forth in Regulation S.

     "Equity Interests" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).

     "Equity Offering" means (1) a public or private sale of Capital Stock of
the Company and (ii) the sale of other securities convertible or exchangeable
into Capital Stock (other than Disqualified Stock) of the Company; provided, an
Equity Offering shall be deemed to occur with respect to all or a portion of
such securities only upon the conversion or exchange of such securities into
Capital Stock.

     "Euroclear" means Morgan Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear system.

     "Event of Default" has the meaning set forth in Section 6.01 hereof.

     "Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the SEC promulgated thereunder.

     "Exchange Notes" means the Notes issued in the Exchange Offer pursuant to
Section 2.06(f) hereof.

     "Exchange Offer" means the offer that may be made by the Company pursuant
to any Registration Rights Agreement to exchange Notes for Exchange Notes and
any similar exchange of Additional Notes.

     "Exchange Offer Registration Statement" has the meaning set forth in the
Registration Rights Agreement.

     "Existing Indebtedness" means Indebtedness of the Company and the Company's
Subsidiaries (other than Indebtedness under the Credit Agreement and the
Existing Notes) in existence on May 11, 1999.



                                      -7-


     Existing Note Indenture" means the Indenture dated as of May 11, 1999 among
the Company, the trustee named therein and the guarantors named therein relating
to the Existing Notes, as supplemented on or before the Closing Date.

     "Existing Notes" means the $200.0 million aggregate principal amount of 8
3/4% Senior Subordinated Notes due 2009 issued by the Company under the Existing
Note Indenture and outstanding on the Closing Date.

     "GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect in the United States from time to time.

     "Global Note" means, individually and collectively, each of the Restricted
Global Notes and the Unrestricted Global Notes, substantially in the form of
Exhibit A hereto that bears the Global Note Legend and that has the "Schedule of
Exchange of Interests in the Global Note" attached thereto.

     "Global Note Legend" means the legend set forth in Section 2.06(g)(ii),
which is required to be placed on all Global Notes issued under this Indenture.

     "Government Securities" means securities that are (a) direct obligations of
the United States of America for the timely payment of which its full faith and
credit is pledged or (b) obligations of a Person controlled or supervised by and
acting as an agency or instrumentality of the United States of America the
timely payment of which is unconditionally guaranteed as a full faith and credit
obligation by the United States of America, which, in either case, are not
callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act), as custodian with respect to any such Government Securities
or a specific payment of principal of or interest on any such Government
Securities held by such custodian for the account of the holder of such
depository receipt; provided that (except as required by law) such custodian is
not authorized to make any deduction from the amount payable to the holder of
such depository receipt from any amount received by the custodian in respect of
the Government Securities or the specific payment of principal of or interest on
the Government Securities evidenced by such depository receipt.

     "Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness.

     "Guarantor" means (i) each of the Company's Restricted Subsidiaries that is
a party to this Indenture on the date of execution and delivery of this
Indenture and (ii) each other Person that becomes a guarantor of the obligations
of the Company under the Notes and this Indenture from time to time in
accordance with the provisions of this Indenture, and their respective
successors and assigns; provided, however, that "Guarantor" shall not include
any Person that is



                                      -8-


released from its Guarantee of the obligations of the Company under the Notes
and this Indenture as provided in Article 12 hereof.

     "Hedging Obligations" means, with respect to any Person, the obligations of
such Person under (i) currency exchange or interest rate swap, cap or collar
agreements and (ii) other agreements or arrangements designed to protect such
Person against fluctuations in currency exchange or interest rates.

     "Holder" means a Person in whose name a Note is registered.

     "IAI Global Note" means a global note substantially in the form of Exhibit
A hereto bearing the Global Note Legend and the Private Placement Legend (with
such changes therein as may be necessary or appropriate to reflect the interest
of an Institutional Accredited Investor) and deposited with or on behalf of, and
registered in the name of, the Depositary or its nominee that will be issued in
a denomination equal to the outstanding principal amount of the Notes sold or
otherwise transferred to Institutional Accredited Investors.

     "Indebtedness" means, with respect to any Person, without duplication, (i)
any indebtedness of such Person, whether or not contingent, in respect of
borrowed money or evidenced by bonds, notes, debentures or similar instruments
or letters of credit (or reimbursement agreements in respect thereof) or
bankers' acceptances or representing Capital Lease Obligations or the balance
deferred and unpaid of the purchase price of any property (which purchase price
is due more than one year after taking title to such property) or services or
representing any Hedging Obligations, except any such balance that constitutes
an accrued expense or trade payable, if and to the extent any of the foregoing
indebtedness (other than letters of credit and Hedging Obligations) would appear
as a liability upon a balance sheet of such Person prepared in accordance with
GAAP; (ii) all indebtedness of others secured by a Lien on any asset of such
Person (whether or not such indebtedness is assumed by such Person the amount of
such obligation, to the extent it is without recourse to such Person, being
deemed to be the lesser of the value of such property or assets or the amount of
the obligation so secured); (iii) to the extent not otherwise included, the
Guarantee by such Person of any Indebtedness of any other Person; provided,
however, that (1) the amount outstanding at any time of any Indebtedness issued
with original issue discount is the face amount of such indebtedness less the
remaining unamortized portion of the original issue discount of such
Indebtedness at such time as determined in conformity with GAAP; and (2)
Indebtedness shall not include any liability for federal, state, local or other
taxes; and (iv) with respect to any Restricted Subsidiary of the Company,
Preferred Stock of such Person (in an amount equal to the greater of (x) the sum
of all obligations of such Person with respect to redemption, repayment or
repurchase thereof and (y) the book value of such Preferred Stock as reflected
on the most recent financial statements of such Person).

     "Indenture" means this Indenture, as amended or supplemented from time to
time.

     "Initial Purchasers" means Deutsche Banc Alex. Brown Inc., Banc of America
Securities LLC, Bear, Stearns & Co. Inc., CIBC World Markets Corp. and Fleet
Securities, Inc.



                                      -9-


     "Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act.

     "Interest Payment Date" means each May 15 and November 15.

     "Investments" means, with respect to any Person, all investments by such
Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including guarantees of Indebtedness or other obligations),
advances or capital contributions (excluding commission, travel and similar
advances to officers and employees made in the ordinary course of business),
purchases or other acquisitions for consideration of Indebtedness, Equity
Interests or other securities, together with all items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP,
excluding, however, trade accounts receivable and bank deposits made in the
ordinary course of business consistent with past practice. If the Company or any
Restricted Subsidiary of the Company sells or otherwise disposes of any Equity
Interests of any direct or indirect Restricted Subsidiary of the Company such
that, after giving effect to any such sale or disposition, such Person is no
longer a Restricted Subsidiary of the Company, the Company shall be deemed to
have made an Investment on the date of any such sale or disposition equal to the
fair market value of the Equity Interests of such Restricted Subsidiary not sold
or disposed of in an amount determined as provided in the penultimate paragraph
of Section 4.10 hereof.

     "Letter of Transmittal" means the letter of transmittal to be prepared by
the Company and sent to all Holders of the Notes for use by such Holders in
connection with the Exchange Offer.

     "Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional, sale or other title retention agreement, any lease
in the nature thereof, and any option or other agreement to sell or give a
Lien).

     "Liquidated Damages" has the meaning set forth in the Registration Rights
Agreement.

     "Make-Whole Amount" means, with respect to any Note, an amount equal to the
excess, if any, of (a) the present value of the remaining principal, premium, if
any, and interest (other than accrued interest otherwise payable upon
redemption) payments that would be payable with respect to such Note if such
Note were redeemed on May 15, 2004, computed using a discount rate equal to the
Treasury Rate plus 50 basis points, over (b) the principal amount of such Note.

     "Make-Whole Average Life" means, with respect to any date of redemption of
Notes, the number of years (calculated to the nearest one-twelfth) from such
redemption date to May 15, 2004.

     "Make-Whole Price" means, with respect to any Note, the greater of (a) the
sum of the principal amount of and Make-Whole Amount with respect to such Note,
and (b) the redemption price of such Note on May 15, 2004.

     "Maturity" when used in respect to any Note means the date on which the
principal of (and premium, if any) and interest and Liquidated Damages, if any,
on such Note becomes due



                                      -10-


and payable as therein or herein provided, whether at Stated Maturity or the
applicable Redemption Date and whether by declaration of acceleration, call for
redemption or otherwise.

     "Net Income" means, with respect to any Person for any period, the net
income (or loss) of such Person, determined in accordance with GAAP and before
any reduction in respect of Preferred Stock dividends, excluding, however, (i)
any gain (or loss), together with any related provision for taxes on such gain
(or loss), realized in connection with (a) any Asset Sale (including, without
limitation, dispositions pursuant to Sale and Leaseback Transactions) or (b) the
disposition of any securities by such Person or any of its Subsidiaries or the
extinguishment of any Indebtedness of such Person or any of its Subsidiaries and
(ii) any extraordinary or nonrecurring gain (or loss), together with any related
provision for taxes on such extraordinary or nonrecurring gain (or loss).

     "Net Proceeds" means the aggregate cash proceeds or Cash Equivalents
proceeds received by the Company or any of its Restricted Subsidiaries in
respect of any Asset Sale (including, without limitation, any cash received upon
the sale or other disposition of any non-cash consideration received in any
Asset Sale, but only as and when received, and any proceeds deemed to be cash or
Cash Equivalents pursuant to clause (b) of the first paragraph of Section 4.16
hereof, net of (i) the direct costs relating to such Asset Sale (including,
without limitation, legal, accounting and investment banking fees, and sales
commissions) and any relocation expenses incurred as a result thereof, (ii)
taxes paid or payable as a result thereof (after taking into account any
available tax credits or deductions and any tax sharing arrangements), (iii)
amounts required to be applied to the repayment of Indebtedness secured by a
Lien on the asset or assets that were the subject of such Asset Sale, (iv) all
distributions and other payments required to be made to minority interest
holders of a Restricted Subsidiary or joint venture as a result of such Asset
Sale, and (v) any reserve for adjustment in respect of the sale price of such
asset or assets established in accordance with GAAP.

     "Non-U.S. Person" means a Person who is not a U.S. Person.

     "Note Custodian" means the custodian for the Depositary of the Global Note
or any successor entity thereto.

     "Notes" means $160,000,000 aggregate principal amount of the Company's 8
3/4% Senior Subordinated Notes due 2009 issued pursuant to this Indenture on the
Closing Date and any other 8 3/4% Senior Subordinated Notes due 2009 hereafter
issued in compliance with the provisions of this Indenture.

     "Obligations" means any principal, premium, interest (including
post-petition interest), penalties, fees, indemnifications, reimbursements,
damages and other liabilities payable under the documentation governing any
Indebtedness.

     "Officer" means, with respect to any Person, the Chairman of the Board, the
Chief Executive Officer, the President, any Senior Vice President, any Vice
President, the Chief Financial Officer, the Secretary or any Assistant Secretary
of such Person.



                                      -11-


     "Officers' Certificate" means, with respect to any Person, a certificate
signed on behalf of such Person by the Chief Executive Officer or President and
by the Chief Financial Officer or chief accounting officer of such Person.

     "Opinion of Counsel" means a written opinion from legal counsel who is
acceptable to the Trustee, that meets the requirements of Section 1.05 hereof
and, to the extent required by the TIA, complies with TIA ss. 314.

     "Participant" means, with respect to DTC, Euroclear or Clearstream, a
Person who has an account with DTC, Euroclear or Clearstream, respectively (and,
with respect to DTC, shall include Euroclear and Clearstream).

     "Permitted Holder" means Apollo Advisors, L.P., a Delaware limited
partnership, or any fund, investment vehicle or account managed, advised or
controlled by Apollo Advisors, L.P., or any of its Affiliates.

     "Permitted Investments" means (i) any Investment in the Company or a
Restricted Subsidiary of the Company; (ii) any Investment in Cash Equivalents;
(iii) any Investment by the Company or any Restricted Subsidiary of the Company
in a Person, if as a result of such Investment (a) such Person becomes a
Restricted Subsidiary of the Company and, to the extent required under the
Indenture, a Guarantor or (b) such Person is merged, consolidated or amalgamated
with or into, or transfers or conveys substantially all of its assets to, or is
liquidated into, the Company or a Restricted Subsidiary of the Company; (iv) any
Investment made as a result of the receipt of non-cash consideration from an
Asset Sale that was made pursuant to and in compliance with Section 4.16 hereof;
(v) any acquisition of assets received solely in exchange for the issuance of
Equity Interests (other than Disqualified Stock) of the Company; (vi) any
Investment in a Similar Business (including any Investment made in any
Unrestricted Subsidiaries in a Similar Business) if, after giving effect to such
Investment, the aggregate amount of all Investments made after May 11, 1999
pursuant to this clause (vi) then constituting Unrestricted Investments
Outstanding does not exceed the greater of (x) $75 million and (y) 7.5% of Total
Consolidated Assets of the Company at the time of such Investment; (vii)
contributions of Real Estate Held for Sale to Real Estate Joint Ventures;
provided, in the case of any Investment made pursuant to this clause (vii) or
the preceding clause (vi), that after giving effect to such Investment (a) no
Default or Event of Default shall have occurred and be continuing or would occur
as a consequence thereof, and (b) the Company would, at the time of such
Investment and after giving pro forma effect thereto as if such Investment had
been made at the beginning of the applicable four-quarter period, have been
permitted to incur at least $1.00 of additional Indebtedness pursuant to the
Consolidated Interest Coverage Ratio test set forth in the first paragraph of
Section 4.09 hereof; and (viii) Investments received in connection with the
settlement of any ordinary course obligations owed to the Company or any of its
Restricted Subsidiaries.

     "Permitted Junior Securities" means Equity Interests (other than
Disqualified Stock) in the Company or debt securities that are subordinated to
all Senior Debt of the issuer of such debt securities (and any debt securities
issued in exchange for Senior Debt of the issuer of such debt securities) to
substantially the same extent as, or to a greater extent than, the Notes are
subordinated to Senior Debt.



                                      -12-


     "Permitted Liens" means (i) Liens in favor of the Company or any of its
Restricted Subsidiaries; (ii) Liens securing Senior Debt of the Company or any
Restricted Subsidiary of the Company; (iii) Liens on property or Equity
Interests of a Person existing at the time such Person is merged into or
consolidated with the Company or any Restricted Subsidiary of the Company;
provided that such Liens were in existence prior to the contemplation of such
merger or consolidation and do not extend to any assets or Equity Interests
other than those of the Person merged into or consolidated with the Company;
(iv) Liens on property existing at the time of acquisition thereof by the
Company or any Restricted Subsidiary of the Company; provided that such Liens
were in existence prior to the contemplation of such acquisition; (v) Liens
incurred or pledges and deposits made in connection with worker's compensation,
unemployment insurance and other social security benefits, statutory
obligations, bid, surety or appeal bonds, performance bonds or other obligations
of a like nature incurred in the ordinary course of business (other than
contracts in respect of borrowed money and other Indebtedness); (vi) Liens
existing on May 11, 1999; (vii) Liens for taxes, assessments or governmental
charges or claims that are not yet delinquent or that are being contested in
good faith by appropriate proceedings promptly instituted and diligently
concluded; provided that any reserve or other appropriate provision as shall be
required in conformity with GAAP shall have been made therefore; (viii) Liens
securing the Notes or any Guarantee thereof; (ix) Liens securing Permitted
Refinancing Indebtedness to the extent that the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded was permitted to be secured
by a Lien; provided that such Liens do not extend to any assets other than those
that secured the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded; (x) Liens incurred in the ordinary course of business of
the Company or any Restricted Subsidiary of the Company with respect to
obligations that do not exceed $5.0 million at any one time outstanding and that
(a) are not incurred in connection with the borrowing of money or the obtaining
of advances or credit (other than trade credit in the ordinary course of
business) and (b) do not in the aggregate materially detract from the value of
the property or materially impair the use thereof in the operation of business
by the Company or such Restricted Subsidiary; (xi) Liens securing Capital Lease
Obligations, provided that such Liens do not extend to any property or assets
which are not leased property subject to such Capitalized Lease Obligation;
(xii) judgment liens not giving rise to an Event of Default so long as such Lien
is adequately bonded and any appropriate legal proceedings that may have been
duly initiated for the review of such judgment, degree or order shall not have
been finally terminated or the period within such proceedings may be initiated
shall not have expired; (xiii) Liens securing obligations of the Company under
Hedging Obligations; (xiv) purchase money Liens securing Purchase Money
Obligations; provided, that the related Indebtedness shall not be secured by any
property or assets of the Company or any Restricted Subsidiary other than the
property or assets so acquired pursuant to such Purchase Money Obligation; (xv)
Liens upon specific items of inventory or other goods and proceeds of any Person
securing such Person's obligations in respect of bankers' acceptances issued or
created for the account of such Person to facilitate the purchase, shipment or
storage of such inventory or other goods; (xvi) Liens encumbering deposits made
to secure obligations arising from statutory, regulatory, contractual, or
warranty requirements of the Company or any of its Restricted Subsidiaries,
including rights of offset and set-off; (xvii) Liens arising from filing Uniform
Commercial Code financing statements regarding leases; provided that such Liens
do not extend to any property or assets which are not leased property subject to
such leases or subleases; and (xviii) Liens created for the benefit of all of
the Notes and/or any Guarantees thereof.



                                      -13-


     "Permitted Refinancing Indebtedness" means any Indebtedness of the Company
or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness (other than Hedging Obligations and other than
Indebtedness permitted to be incurred pursuant to clause (i), clause (iv) or
clause (vii) of the second paragraph of Section 4.09 hereof) of the Company or
any of its Restricted Subsidiaries; provided that: (i) the principal amount (or
accreted value, if applicable) of such Permitted Refinancing Indebtedness does
not exceed the principal amount of (or accreted value, if applicable), plus
premium and accrued interest on, the Indebtedness so extended, refinanced,
renewed, replaced, defeased or refunded (plus the amount of reasonable expenses
incurred in connection therewith); (ii) such Permitted Refinancing Indebtedness
has a final maturity date equal to or later than the final maturity date of, and
has a Weighted Average Life to Maturity equal to or greater than the Weighted
Average Life to Maturity of, the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded; (iii) if the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded is subordinated in
right of payment to the Notes or any Guarantee thereof, such Permitted
Refinancing Indebtedness is subordinated in right of payment to the Notes or
such Guarantee on terms at least as favorable to the Holders of Notes as those
contained in the documentation governing the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded; and (iv) such Indebtedness
is incurred either by the Company or by the Restricted Subsidiary that is an
obligor on the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded.

     "Person" means any individual, limited or general partnership, corporation,
limited liability company, association, unincorporated organization, trust,
joint stock company, joint venture or other entity, or a government or any
agency or political subdivision thereof.

     "Preferred Stock" of any Person means Capital Stock of such Person of any
class or classes (however designated) that ranks prior, as to the payment of
dividends or as to the distribution of assets upon any voluntary or involuntary
liquidation, dissolution or winding up of such Person, to shares of Capital
Stock of any other class of such Person.

     "Private Placement Legend" means the legend set forth in Section
2.06(g)(i)(A) to be placed on all Notes issued under this Indenture except as
permitted pursuant to Section 2.06(g)(i)(B).

     "Purchase Money Obligations" of any Person means any obligations of such
Person or any of its Subsidiaries to any seller or any other person incurred or
assumed in connection with the purchase of real or personal property to be used
in the business of such person or any of its subsidiaries within 180 days of
such purchase.

     "Real Estate Held for Sale" means, with respect to any Person, the real
estate of such Person and its Restricted Subsidiaries classified for financial
reporting purposes as Real Estate Held for Sale on May 11, 1999 or thereafter
acquired as Real Estate Held for Sale.

     "Real Estate Joint Venture" means any Person engaged exclusively in the
acquisition, development and operation or resale of any real estate asset or
group of related real estate assets (and directly related activities).



                                      -14-


     "Redemption Date," when used with respect to any Note to be redeemed, means
the date fixed for such redemption pursuant to this Indenture.

     "Redemption Price," when used with respect to any Note to be redeemed,
means the price (exclusive of any accrued and unpaid interest thereon) at which
it is to be redeemed pursuant to this Indenture.

     "Registration Rights Agreement" means that certain Registration Rights
Agreement, dated as of the date of this Indenture, among the Company, the
Guarantors and the Initial Purchaser, as amended or supplemented from time to
time, or similar agreement relating to Additional Notes.

     "Regular Record Date" for the interest payable on any Interest Payment Date
means the May 1 or November 1 (whether or not a Business Day), as the case may
be, next preceding such Interest Payment Date.

     "Regulation S" means Regulation S promulgated under the Securities Act.

     "Regulation S Global Note" means a Regulation S Temporary Global Note or
Regulation S Permanent Global Note, as appropriate.

     "Regulation S Permanent Global Note" means a permanent global Note in the
form of Exhibit A hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of, and registered in the name
of, the Depositary or its nominee that will be issued in a denomination equal to
the outstanding principal amount of the Regulation S Temporary Global Note upon
expiration of the Distribution Compliance Period.

     "Regulation S Temporary Global Note" means a temporary global Note in the
form of Exhibit A hereto bearing the Global Note Legend, the Private Placement
Legend and the Regulation S Temporary Global Note Legend and deposited with or
on behalf of, and registered in the name of, the Depositary or its nominee that
will be issued in a denomination equal to the initial outstanding principal
amount of the Notes sold in reliance on Rule 904 of Regulation S.

     "Regulation S Temporary Global Note Legend" means the legend set forth in
Section 2.06(g)(iii) which is required to be placed on all Regulation S
Temporary Global Notes issued under this Indenture.

     "Responsible Officer" when used with respect to the Trustee, shall mean any
officer assigned to the Corporate Trust Office, including any managing director,
vice president, assistant vice president, assistant treasurer, assistant
secretary or any other officer of the Trustee customarily performing functions
similar to those performed by any of the above designated officers and having
direct responsibility for the administration of this Indenture, and also, with
respect to a particular matter, any other officer, to whom such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject.

     "Restricted Definitive Note" means a Definitive Note bearing the Private
Placement Legend.



                                      -15-


     "Restricted Global Note" means a Global Note bearing the Private Placement
Legend.

     "Restricted Investment" means an Investment other than a Permitted
Investment.

     "Restricted Period" means the 40 day restricted period as defined in
Regulation S.

     "Restricted Subsidiary" of a Person means any Subsidiary of the referent
Person that is not an Unrestricted Subsidiary.

     "Rule 144" means Rule 144 promulgated under the Securities Act.

     "Rule 144A" means Rule 144A promulgated under the Securities Act.

     "Rule 903" means Rule 903 promulgated under the Securities Act.

     "Rule 904" means Rule 904 promulgated under the Securities Act.

     "Sale and Leaseback Transaction" means an arrangement relating to property
now owned or hereafter acquired whereby the Company or a Restricted Subsidiary
transfers such property to a Person and the Company or a Restricted Subsidiary
leases it from such Person.

     "SEC" means the Securities and Exchange Commission.

     "Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.

     "Senior Debt" of any Person means (i) the Obligations of such Person under
the Credit Agreement, including, without limitation, Hedging Obligations and
reimbursement obligations in respect of letters of credit and bankers
acceptances, and (ii) any other Indebtedness of such Person, unless the
instrument under which such Indebtedness is incurred expressly provides that it
is on a parity with or subordinated in right of payment to the Notes.
Notwithstanding anything to the contrary in the foregoing, Senior Debt of a
Person shall not include (u) any Indebtedness represented by the Existing Notes
or by any Guarantee of the Existing Notes, (v) any obligation to, in respect of
or imposed by any environmental, landfill, waste management or other regulatory
governmental agency, statute, law or court order, (w) any liability for federal,
state, local or other taxes, (x) any Indebtedness of such Person to any of its
Subsidiaries or other Affiliates, (y) any trade payables or (z) any Indebtedness
that is incurred by such Person in violation of the Indenture (except to the
extent that the original holder thereof relied in good faith after being
provided with a copy of this Indenture upon an Officer's Certificate of such
Person to the effect that the incurrence of such Indebtedness did not violate
this Indenture).

     "Shelf Registration Statement" has the meaning set forth in the
Registration Rights Agreement.

     "Significant Subsidiary" means any Restricted Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation was in effect on
May 11, 1999.



                                      -16-


     "Similar Business" means any business conducted by the Company or any of
its Subsidiaries as of May 11, 1999 or any other recreation, leisure and/or
hospitality business including without limitation ski mountain resort
operations, or any business or activity that is reasonably similar thereto or a
reasonable extension, development or expansion thereof or is reasonably
ancillary thereto.

     "Special Record Date" means a date fixed by the Trustee for the payment of
any Defaulted Interest pursuant to Section 2.12 thereof.

     "Stated Maturity" means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and shall not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.

     "Subsidiary" means, with respect to any Person, (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of at least a majority of the
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by such Person or one or more of the other Subsidiaries
of that Person (or a combination thereof) and (ii) any partnership (a) the sole
general partner or the managing general partner of which is such Person or a
Subsidiary of such Person or (b) the only general partners of which are such
Person or one or more Subsidiaries of such Person (or any combination thereof).

     "Subsidiary Guarantee" means any guarantee of the obligations of the
Company pursuant to this Indenture and the Notes by any Person in accordance
with the provisions of this Indenture.

     "TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ss.ss. 77a-77bbbb)
as in effect on the date on which this Indenture is qualified under the TIA;
provided, however, that in the event the Trust Indenture Act of 1939 is amended
after such date, then "TIA" means, to the extent required by such amendment, the
Trust Indenture Act of 1939 as so amended.

     "Total Consolidated Assets" means, with respect to any Person as of any
date, the book value of the assets of such Person and its Restricted
Subsidiaries as shown on the most recent consolidated balance sheet of such
Person.

     "Treasury Rate" means, at any time of computation, the yield to maturity at
such time (as compiled by and published in the most recent statistical release
(or any successor release) of the Federal Reserve Bank of New York, which has
become publicly available at least two business days prior to the date of the
redemption notice or, if such statistical release (or successor release) is no
longer published, any generally recognized publicly available source of similar
market data) of United States Treasury securities with a constant maturity most
nearly equal to the Make-Whole Average Life; provided, however, that if the
Make-Whole Average Life is not equal to the constant maturity of the United
States Treasury security for which a weekly average yield is given, the Treasury
Rate shall be obtained by linear interpolation (calculated to the nearest
one-twelfth of a year) from the weekly average yields of United States Treasury


                                      -17-


securities for which such yields are given, except that if the Make-Whole
Average Life is less than one year, the weekly average yield on actually traded
United States Treasury securities adjusted to a constant maturity of one year
shall be used.

     "Trustee" means the party named as such above until a successor replaces it
in accordance with applicable provisions of this Indenture and thereafter means
such successor.

     "Unrestricted Definitive Note" means one or more Definitive Notes that do
not bear and are not required to bear the Private Placement Legend.

     "Unrestricted Global Note" means a permanent global Note substantially in
the form of Exhibit A attached hereto that bears the Global Note Legend and that
has the "Schedule of Exchanges of Interests in the Global Note" attached
thereto, and that is deposited with or on behalf of and registered in the name
of the Depositary, representing Notes that do not bear the Private Placement
Legend.

     "Unrestricted Investments Outstanding" means, at any time of determination,
in respect of all Permitted Investments made pursuant to clause (vi) of the
definition of the term Permitted Investments, the excess, if any, of (i) the sum
of all Permitted Investments theretofore made by the Company or any Restricted
Subsidiary on or after May 11, 1999 pursuant to clause (vi) of the definition of
Permitted Investments over (ii) the amount of all cash, and the fair market
value of any assets or property, distributed as dividends and distributions to
the Company or a Restricted Subsidiary of the Company (to the extent that the
Company does not elect to include the amount of such dividends and distributions
in the computation of Consolidated Net Income pursuant to the parenthetical of
clause (i) of the definition thereof at the time of determination), and all
repayments of the principal amount of loans or advances, the net cash proceeds,
and the fair market value of assets or property, received from sales or
transfers, in respect of such Investments to the Company or any of its
Restricted Subsidiaries and any other reduction made in cash of such Investments
in such Person.

     "Unrestricted Subsidiary" means Boulder/Beaver, LLC, Colter Bay
Corporation, Eagle Park Reservoir Company, Forest Ridge Holdings, Inc., Gros
Ventre Utility Company, Jackson Lake Lodge Corporation, Jenny Lake Lodge, Inc.,
Mountain Thunder, Inc., Resort Technology Partners, LLC, RT Partners, Inc., SSI
Venture, LLC, Vail Associates Investments, Inc. and VR Holdings, Inc., and any
other Subsidiary that is designated by the Board of Directors as an Unrestricted
Subsidiary pursuant to a Board Resolution, but only to the extent that such
Subsidiary is not party to any agreement, contract, arrangement or understanding
with the Company or any Restricted Subsidiary of the Company unless the terms of
any such agreement, contract, arrangement or understanding comply with Section
4.12 hereof.

     "U.S. Person" means a U.S. person as defined in Rule 902(k) under the
Securities Act.

     "Voting Stock" of any Person as of any date means classes of the Capital
Stock of such Person that is at the time entitled to vote in the election of at
least a majority of the directors, managers, trustees or other governing body of
such Person.

     "Weighted Average Life to Maturity" means, when applied to any Indebtedness
at any date, the number of years obtained by dividing (i) the sum of the
products obtained by



                                      -18-


multiplying (a) the amount of each then remaining installment, sinking fund,
serial maturity or other required payments of principal, including payment at
final maturity, in respect thereof, by (b) the number of years (calculated to
the nearest one-twelfth) that will elapse between such date and the making of
such payment, by (ii) the then outstanding principal amount of such
Indebtedness.

SECTION 1.02. Other Definitions

                                                              Defined
     Term                                                    in Section
     ----                                                    ----------

     "Act"                                                       1.07
     "Affiliate Transaction"                                     4.12
     "Asset Sale Offer"                                          3.10
     "Change of Control Offer"                                   4.17
     "Change of Control Payment"                                 4.17
     "Change of Control Payment Date"                            4.17
     "Contributor"                                              12.07
     "Covenant Defeasance"                                       8.03
     "DTC"                                                       2.03
     "Defaulted Interest"                                        2.12
     "Event of Default"                                          6.01
     "Excess Proceeds"                                           4.16
     "Expiration Date"                                           4.17
     "Funding Party"                                            12.07
     "Guaranteed Obligations"                                   12.01
     "incur"                                                     4.09
     "Legal Defeasance"                                          8.02
     "Offer Amount"                                              3.10
     "Offer Period"                                              3.10
     "Paying Agent"                                              2.03
     "Payment Blockage Notice"                                  10.03
     "Payment Default"                                           6.01
     "Permitted Debt"                                            4.09
     "Purchase Date"                                             3.10
     "QIB"                                                       2.01
     "Registrar"                                                 2.03
     "Restricted Payments"                                       4.10


SECTION 1.03. Incorporation by Reference of Trust Indenture Act

     Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture.



                                      -19-


     The following TIA terms used in this Indenture have the following meanings:

     "indenture securities" means the Notes and the Subsidiary Guarantees;

     "indenture security Holder" means a Holder of a Note;

     "indenture to be qualified" means this Indenture;

     "indenture trustee" or "institutional trustee" means the Trustee;

     "obligor" on the Notes means the Company, each Guarantor and any successor
obligors upon the Notes.

     All other terms used in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by SEC rule under the TIA have
the meanings so assigned to them.

SECTION 1.04. Rules of Construction

     Unless the context otherwise requires:

          (1) a term has the meaning assigned to it;

          (2) an accounting term not otherwise defined has the meaning assigned
     to it in accordance with GAAP;

          (3) "or" is not exclusive;

          (4) words in the singular include the plural, and words in the plural
     include the singular;

          (5) provisions apply to successive events and transactions; and

          (6) references to sections of or rules under the Securities Act or the
     Exchange Act shall be deemed to include substitute, replacement or
     successor sections or rules adopted by the SEC from time to time.

SECTION 1.05.  Compliance Certificates and Opinions

     Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee an Officers' Certificate stating that all conditions precedent, if any,
provided for in this Indenture (including any covenant compliance with which
constitutes a condition precedent) relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with, except
that, in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.



                                      -20-


     Every certificate or opinion (other than the certificates required by
Section 4.05(a) hereof) with respect to compliance with a condition or covenant
provided for in this Indenture shall comply with the provisions of TIA ss.
314(e) and shall include:

          (a) a statement that each individual signing such certificate or
     opinion has read such covenant or condition and the definitions herein
     relating thereto;

          (b) a brief statement as to the nature and scope of the examination or
     investigation upon which the statements or opinions contained in such
     certificate or opinion are based;

          (c) a statement that, in the opinion of each such individual, he or
     she has made such examination or investigation as is necessary to enable
     him or her to express an informed opinion as to whether or not such
     covenant or condition has been complied with; and

          (d) a statement as to whether, in the opinion of each such individual,
     such condition or covenant has been complied with.

SECTION 1.06.  Form of Documents Delivered to Trustee

     In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.

     Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representation
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel, may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.

     Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.

SECTION 1.07.  Acts of Holders

     (a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Holders may
be embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an agent duly appointed in writing;
and, except as herein otherwise expressly



                                      -21-


provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the Holders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Indenture and (subject to TIA ss. 315) conclusive in favor of
the Trustee and the Company, if made in the manner provided in this Section
1.07.

     (b) The fact and date of the execution by any Person of any such instrument
or writing may be proved in any reasonable manner that the Trustee deems
sufficient.

     (c) The ownership of Notes shall be proved by a register kept by the
Registrar.

     (d) If the Company shall solicit from the Holders any request, demand,
authorization, direction, notice, consent, waiver or other Act, the Company may,
at its option, by or pursuant to a Board Resolution, fix in advance a record
date for the determination of such Holders entitled to give such request,
demand, authorization, direction, notice, consent, waiver or other Act or to
revoke any consent previously given, but the Company shall have no obligation to
do so. Notwithstanding TIA ss. 316(c), any such record date shall be the record
date specified in or pursuant to such Board Resolution, which shall be a date
not more than 30 days prior to the first solicitation of Holders generally in
connection therewith and no later than the date such solicitation is completed.

     If such a record date is fixed, such request, demand, authorization,
direction, notice, consent, waiver or other Act or revocation of any consent
previously given may be given before or after such record date, but only the
Holders of record at the close of business on such record date shall be deemed
to be Holders for the purposes of determining whether Holders of the requisite
proportion of Notes then outstanding have authorized or agreed or consented to
such request, demand, authorization, direction, notice, consent, waiver or other
Act, and for this purpose the Notes then outstanding shall be computed as of
such record date; provided that no such request, demand, authorization,
direction, notice, consent, waiver or other Act by the Holders on such record
date shall be deemed effective unless it shall become effective pursuant to the
provisions of this Indenture not later than nine months after the record date.

     (e) Any request, demand, authorization, direction, notice, consent, waiver
or other Act by the Holder of any Note shall bind every future Holder of the
same Note or the Holder of every Note issued upon the registration of transfer
thereof or in exchange therefor or in lieu thereof, in respect of anything done,
suffered or omitted to be done by the Trustee, any Paying Agent or the Company
in reliance thereon, whether or not notation of such action is made upon such
Note.

     (f) All Notes issued pursuant to this Indenture shall vote as one class on
all matters.



                                      -22-


                                   ARTICLE 2

                                   THE NOTES

SECTION 2.01.  Form and Dating

     (a) General. The Notes and the Trustee's certificate of authentication
relating thereto shall be substantially in the form of Exhibit A attached hereto
with such appropriate insertions, substitutions and other variations as are
required or permitted by this Indenture. The Notes may have notations, legends
or endorsements required by law, stock exchange rule or usage, as designated by
the Company or its counsel. Each Note shall be dated the date of its
authentication. The Notes shall be in denominations of $1,000 and integral
multiples thereof.

     (b) Global Notes. Notes issued in global form shall be substantially in the
form of Exhibit A attached hereto (including the Global Note Legend and the
"Schedule of Exchanges in the Global Note" attached thereto). Notes issued in
definitive form shall be substantially in the form of Exhibit A attached hereto
(but without the Global Note Legend and without the "Schedule of Exchanges of
Interests in the Global Note" attached thereto). Each Global Note shall
represent such of the outstanding Notes as shall be specified therein and the
aggregate principal amount of outstanding Notes represented thereby from time to
time shall be reflected on the records maintained by the Trustee. The aggregate
principal amount of outstanding Notes represented by a Global Note may from time
to time be reduced or increased, as appropriate, to reflect transfers,
exchanges, repurchases and redemptions. Any increase or decrease in the
aggregate principal amount outstanding of a Global Note shall be reflected on
the records maintained by the Trustee or the Note Custodian, at the direction of
the Trustee, in accordance with instructions given by the Holder thereof as
required by Section 2.06 hereof.

     (c) Temporary Global Notes. Notes offered and sold in reliance on
Regulation S shall be issued initially in the form of the Regulation S Temporary
Global Note, which shall be deposited on behalf of the purchasers of the Notes
represented thereby with the Trustee, at its New York office, as custodian for
the Depositary, and registered in the name of the Depositary or the nominee of
the Depositary for the accounts of designated agents holding on behalf of
Euroclear or Clearstream, duly executed by the Company and authenticated by the
Trustee as hereinafter provided. The Distribution Compliance Period shall be
terminated upon the receipt by the Trustee of (i) a written certificate from the
Depositary, together with copies of certificates from Euroclear and Clearstream
certifying that they have received certification of non-United States beneficial
ownership of 100% of the aggregate principal amount of the Regulation S
Temporary Global Note (except to the extent of any beneficial owners thereof who
acquired an interest therein during the Distribution Compliance Period pursuant
to another exemption from registration under the Securities Act and who will
take delivery of a beneficial ownership interest in a 144A Global Note or an IAI
Global Note bearing a Private Placement Legend, all as contemplated by Section
2.06(g)(i)), and (ii) an Officers' Certificate from the Company. Following the
termination of the Distribution Compliance Period, beneficial interests in the
Regulation S Temporary Global Note shall be exchanged for beneficial interests
in Regulation S Permanent Global Notes pursuant to the Applicable Procedures.
Simultaneously with the authentication of Regulation S Permanent Global Notes,
the Trustee shall cancel the Regulation S Temporary Global Note. The aggregate
principal amount of the Regulation S



                                      -23-


Temporary Global Note and the Regulation S Permanent Global Notes may from time
to time be increased or decreased by adjustments made on the records of the
Trustee and the Depositary or its nominee, as the case may be, in connection
with transfers of interest as hereinafter provided.

     (d) Euroclear and Clearstream Procedures Applicable. The provisions of the
"Operating Procedures of the Euroclear System" and "Terms and Conditions
Governing Use of Euroclear" and the "General Terms and Conditions of
Clearstream" and "Customer Handbook" of Cedel Bank (as adopted by Clearstream)
and any alternative or additional procedures from time to time adopted by
Euroclear or Clearstream shall be applicable to transfers of beneficial
interests in the Regulation S Temporary Global Note and the Regulation S
Permanent Global Notes that are held by Participants through Euroclear or
Clearstream.

SECTION 2.02.  Execution and Authentication

     Two Officers of the Company shall sign the Notes for the Company by manual
or facsimile signature.

     If an Officer of the Company whose signature is on a Note no longer holds
that office at the time the Note is authenticated, the Note shall nevertheless
be valid.

     A Note shall not be valid until authenticated by the manual signature of
the Trustee. The signature of the Trustee shall be conclusive evidence that the
Note so authenticated has been duly authenticated and delivered hereunder.

     The Trustee shall, by a written order of the Company signed by two Officers
(an "Authentication Order"), authenticate Notes for original issue in the
aggregate principal amount of up to $300,000,000. Except as contemplated by
Section 2.08 hereof, the aggregate principal amount of Notes outstanding at any
time may not exceed $300,000,000.

     The Trustee may appoint an authenticating agent acceptable to the Company
to authenticate Notes. Unless limited by the terms of such appointment, an
authenticating agent may authenticate Notes whenever the Trustee may do so. Each
reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same rights as an
Agent to deal with any Holder, the Company or an Affiliate of the Company. The
Trustee shall not be liable for any act or failure to act of the authenticating
agent to perform any duty either required herein or authorized herein to be
performed by such person in accordance with this Indenture. Each authenticating
agent shall be acceptable to the Company and otherwise comply in all respects
with the eligibility requirements of the Trustee contained in this Indenture.

SECTION 2.03.  Registrar and Paying Agent

     The Company shall maintain an office or agency where Notes may be presented
for registration of transfer or for exchange ("Registrar") and an office or
agency where Notes may be presented or surrendered for payment ("Paying Agent").
The Registrar shall keep a register of the Notes and of their transfer and
exchange. The Company may appoint one or more co-registrars and one or more
additional paying agents. The term "Paying Agent" includes any additional paying
agents. The Company may change any Paying Agent or Registrar without



                                      -24-


notice to any Holder. The Company shall notify the Trustee in writing of the
name and address of any Agent not a party to this Indenture. If the Company
fails to appoint or maintain another entity as Registrar or Paying Agent, the
Trustee shall act as such and shall be entitled to appropriate compensation in
accordance with Section 7.07 hereof. The Company or any of its Subsidiaries may
not act as Paying Agent or Registrar.

     The Company shall enter into an appropriate agency agreement with any Agent
not a party to this Indenture, which shall incorporate the provisions of the
TIA. The agreement shall implement the provisions of this Indenture that relate
to such Agent. The Company initially appoints The Depository Trust Company
("DTC") to act as Depositary with respect to the Global Notes.

     The Company initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as Note Custodian with respect to the Global Notes.

SECTION 2.04.  Paying Agent to Hold Assets in Trust

     The Company shall require each Paying Agent other than the Trustee to agree
in writing that the Paying Agent will hold in trust for the benefit of Holders
or the Trustee all assets held by the Paying Agent for the payment of principal
of, premium or Liquidated Damages, if any, or interest on the Notes (whether
such assets have been distributed to it by the Company or any other obligor on
the Notes), and will notify the Trustee of any default by the Company or any
Guarantor in making any such payment. While any such default continues, the
Trustee may require a Paying Agent to pay all money held by it to the Trustee.
The Company at any time may require a Paying Agent to distribute all assets held
by it to the Trustee and account for any assets disbursed. Upon payment over and
accounting to the Trustee, the Paying Agent shall have no further liability for
the assets. Upon any bankruptcy or reorganization proceedings relating to the
Company or any Guarantor, the Trustee shall serve as Paying Agent for the Notes.

SECTION 2.05. Holder Lists

     The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA ss. 312(a). If the Trustee is
not the Registrar, the Company and/or the Guarantors shall furnish to the
Trustee at least seven Business Days before each Interest Payment Date and at
such other times as the Trustee may request in writing, a list in such form and
as of such date as the Trustee may reasonably require of the names and addresses
of the Holders of Notes, including the aggregate principal amount of Notes held
by each Holder, and the Company and/or the Guarantors shall otherwise comply
with TIA ss. 312(a).

SECTION 2.06.  Transfer and Exchange

     (a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes will be exchanged by
the Company for Definitive Notes if, and only if, either (i) the Company
delivers to the Trustee notice from the Depositary that it is unwilling or
unable to



                                      -25-


continue as depositary and a successor depositary is not appointed by the
Company within 90 days after the date of such notice from the Depositary, or
(ii) the Company in its sole discretion determines that the Global Notes (in
whole but not in part) should be exchanged for Definitive Notes and delivers a
written notice to such effect to the Trustee; provided that in no event shall
the Regulation S Temporary Global Note be exchanged by the Company for
Definitive Notes prior to (x) the expiration of the Distribution Compliance
Period and (y) the receipt by the Registrar of any certificates required
pursuant to Rule 903(c)(3)(ii)(B) under the Securities Act, then, upon surrender
by the Global Note Holder of a Global Note, Notes in the form of Definitive
Notes will be issued to each person that the Global Note Holder and the
Depositary identify as being the beneficial owner of the related Notes. Upon the
occurrence of any of the preceding events in (i) or (ii) above, Definitive Notes
shall be issued in such names as the Depositary shall instruct the Trustee.
Global Notes also may be exchanged or replaced, in whole or in part, as provided
in Sections 2.07 and 2.10 hereof. Every Note authenticated and delivered in
exchange for, or in lieu of, a Global Note or any portion thereof, pursuant to
Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form
of, and shall be, a Global Note. A Global Note may not be exchanged for another
Note other than as provided in this Section 2.06(a), however, beneficial
interests in a Global Note may be transferred and exchanged as provided in
Section 2.06(b), (c) or (f) hereof.

     (b) Transfer and Exchange of Beneficial Interests in the Global Notes. The
transfer and exchange of beneficial interests in the Global Notes shall be
effected through the Depositary, in accordance with the provisions of this
Indenture and the Applicable Procedures. Beneficial interests in the Restricted
Global Notes shall be subject to restrictions on transfer comparable to those
set forth herein to the extent required by the Securities Act. Transfers of
beneficial interests in the Global Notes also shall require compliance with
either subparagraph (i) or (ii) below, as applicable, as well as one or more of
the other following subparagraphs as applicable:

          (i) Transfer of Beneficial Interests in the Same Global Note.
     Beneficial interests in any Restricted Global Note may be transferred to
     Persons who take delivery thereof in the form of a beneficial interest in
     the same Restricted Global Note in accordance with the transfer
     restrictions set forth in the Private Placement Legend; provided, however,
     that prior to the expiration of the Distribution Compliance Period
     transfers of beneficial interests in the Temporary Regulation S Global Note
     may not be made to a U.S. Person or for the account or benefit of a U.S.
     Person. Beneficial interests in any Unrestricted Global Note may be
     transferred to Persons who take delivery thereof in the form of a
     beneficial interest in an Unrestricted Global Note. No written orders or
     instructions shall be required to be delivered to the Registrar to effect
     the transfers described in this Section 2.06(b)(i).

          (ii) All Other Transfers and Exchanges of Beneficial Interests in
     Global Notes. In connection with all transfers and exchanges of beneficial
     interests (other than a transfer of a beneficial interest in a Global Note
     to a Person who takes delivery thereof in the form of a beneficial interest
     in the same Global Note), the transferor of such beneficial interest must
     deliver to the Registrar either (A) (1) a written order from a Participant
     or an Indirect Participant given to the Depositary in accordance with the
     Applicable Procedures directing the Depositary to credit or cause to be
     credited a beneficial interest in another Global Note in an amount equal to
     the beneficial interest to



                                      -26-


     be transferred or exchanged and (2) instructions given in accordance with
     the Applicable Procedures containing information regarding the Participant
     account to be credited with such increase or (B) (1) a written order from a
     Participant or an Indirect Participant given to the Depositary in
     accordance with the Applicable Procedures directing the Depositary to cause
     to be issued a Definitive Note in an amount equal to the beneficial
     interest to be transferred or exchanged and (2) instructions given by the
     Depositary to the Registrar containing information regarding the Person in
     whose name such Definitive Note shall be registered to effect the transfer
     or exchange referred to in (1) above; provided that in no event shall
     Definitive Notes be issued upon the transfer or exchange of beneficial
     interests in the Regulation S Temporary Global Note prior to (x) the
     expiration of the Distribution Compliance Period and (y) the receipt by the
     Registrar of any certificates required pursuant to Rule 903 under the
     Securities Act. Upon consummation of an Exchange Offer by the Company in
     accordance with Section 2.06(f) hereof, the requirements of this Section
     2.06(b)(ii) shall be deemed to have been satisfied upon receipt by the
     Registrar of the instructions contained in the Letter of Transmittal
     delivered by the Holder of such beneficial interests in the Restricted
     Global Notes. Upon satisfaction of all of the requirements for transfer or
     exchange of beneficial interests in Global Notes contained in this
     Indenture, the Notes and otherwise applicable under the Securities Act, the
     Trustee shall adjust the principal amount of the relevant Global Note(s)
     pursuant to Section 2.06(h) hereof.

          (iii) Transfer of Beneficial Interests to Another Restricted Global
     Note. A beneficial interest in any Restricted Global Note may be
     transferred to a Person who takes delivery thereof in the form of a
     beneficial interest in another Restricted Global Note if the transfer
     complies with the requirements of clause (ii) above and the Registrar
     receives the following:

               (A) if the transferee will take delivery in the form of a
          beneficial interest in the 144A Global Note, then the transferor must
          deliver a certificate in the form of Exhibit B hereto, including the
          certifications in item (1) thereof;

               (B) if the transferee will take delivery in the form of a
          beneficial interest in the Regulation S Temporary Global Note or the
          Regulation S Global Note, then the transferor must deliver a
          certificate in the form of Exhibit B hereto, including the
          certifications in item (2) thereof; and

               (C) if the transferee will take delivery in the form of a
          beneficial interest in the IAI Global Note, then the transferor must
          deliver a certificate in the form of Exhibit B hereto, including the
          certifications, certificates and Opinion of Counsel required by item
          (3)(d) thereof, if applicable.

          (iv) Transfer and Exchange of Beneficial Interests in a Restricted
     Global Note for Beneficial Interests in the Unrestricted Global Note. A
     beneficial interest in any Restricted Global Note may be exchanged by any
     holder thereof for a beneficial interest in an Unrestricted Global Note or
     transferred to a Person who takes delivery thereof in the form of a
     beneficial interest in an Unrestricted Global Note if the exchange or
     transfer complies with the requirements of clause (ii) above and:



                                      -27-


               (A) such exchange or transfer is effected pursuant to the
          Exchange Offer in accordance with the Registration Rights Agreement
          and the holder of the beneficial interest to be transferred, in the
          case of an exchange, or the transferee, in the case of a transfer,
          certifies in the applicable Letter of Transmittal that it is not (1) a
          Broker-Dealer, (2) a Person participating in the distribution of the
          Exchange Notes or (3) a Person who is an affiliate (as defined in Rule
          144) of the Company;

               (B) any such transfer is effected pursuant to the Shelf
          Registration Statement in accordance with the Registration Rights
          Agreement;

               (C) any such transfer is effected by a Broker-Dealer pursuant to
          the Exchange Offer Registration Statement in accordance with the
          Registration Rights Agreement; or

               (D) the Registrar receives the following:

                    (1) if the holder of such beneficial interest in a
               Restricted Global Note proposes to exchange such beneficial
               interest for a beneficial interest in an Unrestricted Global
               Note, a certificate from such holder in the form of Exhibit C
               hereto, including the certifications in item (1)(a) thereof; or

                    (2) if the holder of such beneficial interest in a
               Restricted Global Note proposes to transfer such beneficial
               interest to a Person who shall take delivery thereof in the form
               of a beneficial interest in an Unrestricted Global Note, a
               certificate from such holder in the form of Exhibit B hereto,
               including the certifications in item (4) thereof;

          and, in each such case set forth in this subparagraph (D), if the
          Registrar so requests or if the Applicable Procedures so require, an
          Opinion of Counsel in form reasonably acceptable to the Registrar to
          the effect that such exchange or transfer is in compliance with the
          Securities Act and that the restrictions on transfer contained herein
          and in the Private Placement Legend are no longer required in order to
          maintain compliance with the Securities Act.

     If any such transfer is effected pursuant to subparagraph (B) or (D) above
at a time when an Unrestricted Global Note has not yet been issued, the Company
shall issue and, upon receipt of an authentication order in accordance with
Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted
Global Notes in an aggregate principal amount equal to the principal amount of
beneficial interests transferred pursuant to subparagraph (B) or (D) above.

     Beneficial interests in an Unrestricted Global Note cannot be exchanged
for, or transferred to Persons who take delivery thereof in the form of, a
beneficial interest in a Restricted Global Note.

     (c) Transfer or Exchange of Beneficial Interests for Definitive Notes.



                                      -28-


     (i) Beneficial Interest in Restricted Global Notes to Restricted Definitive
Notes. If any holder of a beneficial interest in a Restricted Global Note
proposes to exchange such beneficial interest for a Restricted Definitive Note
or to transfer such beneficial interest to a Person who takes delivery thereof
in the form of a Restricted Definitive Note, then, upon receipt by the Registrar
of the following documentation:

          (A) if the holder of such beneficial interest in a Restricted Global
     Note proposes to exchange such beneficial interest for a Restricted
     Definitive Note, a certificate from such holder in the form of Exhibit C
     hereto, including the certifications in item (2)(a) thereof;

          (B) if such beneficial interest is being transferred to a QIB in
     accordance with Rule 144A under the Securities Act, a certificate to the
     effect set forth in Exhibit B hereto, including the certifications in item
     (1) thereof;

          (C) if such beneficial interest is being transferred to a Non-U.S.
     Person in an offshore transaction in accordance with Rule 903 or Rule 904
     under the Securities Act, a certificate to the effect set forth in Exhibit
     B hereto, including the certifications in item (2) thereof;

          (D) if such beneficial interest is being transferred pursuant to an
     exemption from the registration requirements of the Securities Act in
     accordance with Rule 144 under the Securities Act, a certificate to the
     effect set forth in Exhibit B hereto, including the certifications in item
     (3)(a) thereof;

          (E) if such beneficial interest is being transferred to an
     Institutional Accredited Investor in reliance on an exemption from the
     registration requirements of the Securities Act other than those listed in
     subparagraphs (B) through (D) above, a certificate to the effect set forth
     in Exhibit B hereto, including the certifications, certificates and Opinion
     of Counsel required by item (3) thereof, if applicable;

          (F) if such beneficial interest is being transferred to the Company or
     any of its Subsidiaries, a certificate to the effect set forth in Exhibit B
     hereto, including the certifications in item (3)(b) thereof; or

          (G) if such beneficial interest is being transferred pursuant to an
     effective registration statement under the Securities Act, a certificate to
     the effect set forth in Exhibit B hereto, including the certifications in
     item (3)(c) thereof,

the Trustee shall cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and the
Company shall execute and the Trustee shall authenticate and deliver to the
Person designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section 2.06(c) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect



                                      -29-


Participant. The Trustee shall deliver such Definitive Notes to the Persons in
whose names such Notes are so registered. Any Definitive Note issued in exchange
for a beneficial interest in a Restricted Global Note pursuant to this Section
2.06(c)(i) shall bear the Private Placement Legend and shall be subject to all
restrictions on transfer contained therein.

     Notwithstanding Sections 2.06(c)(i)(A) and (C), a beneficial interest in
the Regulation S Temporary Global Note may not be exchanged for a Definitive
Note or transferred to a Person who takes delivery thereof in the form of a
Definitive Note prior to (x) the expiration of the Distribution Compliance
Period and (y) the receipt by the Registrar of any certificates required
pursuant to Rule 903(c)(3)(ii)(B) under the Securities Act, except in the case
of a transfer pursuant to an exemption from the registration requirements of the
Securities Act other than Rule 903 or Rule 904.

     (ii) Beneficial Interests in Restricted Global Notes to Unrestricted
Definitive Notes. A holder of a beneficial interest in a Restricted Global Note
may exchange such beneficial interest for an Unrestricted Definitive Note or may
transfer such beneficial interest to a Person who takes delivery thereof in the
form of an Unrestricted Definitive Note only if:

          (A) such exchange or transfer is effected pursuant to the Exchange
     Offer in accordance with the Registration Rights Agreement and the holder
     of such beneficial interest, in the case of an exchange, or the transferee,
     in the case of a transfer, is not (1) a Broker-Dealer, (2) a Person
     participating in the distribution of the Exchange Notes or (3) a Person who
     is an affiliate (as defined in Rule 144) of the Company;

          (B) any such transfer is effected pursuant to the Shelf Registration
     Statement in accordance with the Registration Rights Agreement;

          (C) any such transfer is effected by a Broker-Dealer pursuant to the
     Exchange Offer Registration Statement in accordance with the Registration
     Rights Agreement; or

          (D) the Registrar receives the following:

               (1) if the holder of such beneficial interest in a Restricted
          Global Note proposes to exchange such beneficial interest for a
          Definitive Note that does not bear the Private Placement Legend, a
          certificate from such holder in the form of Exhibit C hereto,
          including the certifications in item (1)(b) thereof; or

               (2) if the holder of such beneficial interest in a Restricted
          Global Note proposes to transfer such beneficial interest to a Person
          who shall take delivery thereof in the form of a Definitive Note that
          does not bear the Private Placement Legend, a certificate from such
          holder in the form of Exhibit B hereto, including the certifications
          in item (4) thereof;



                                      -30-


     and, in each such case set forth in this subparagraph (D), if the Registrar
     so requests or if the Applicable Procedures so require, an Opinion of
     Counsel in form reasonably acceptable to the Company, to the effect that
     such exchange or transfer is in compliance with the Securities Act and that
     the restrictions on transfer contained herein and in the Private Placement
     Legend are no longer required in order to maintain compliance with the
     Securities Act.

     (iii) Beneficial Interests in Unrestricted Global Notes to Unrestricted
Definitive Notes. If any holder of a beneficial interest in an Unrestricted
Global Note proposes to exchange such beneficial interest for a Definitive Note
or to transfer such beneficial interest to a Person who takes delivery thereof
in the form of a Definitive Note, then, upon satisfaction of the conditions set
forth in Section 2.06(b)(ii) hereof, the Trustee shall cause the aggregate
principal amount of the applicable Global Note to be reduced accordingly
pursuant to Section 2.06(h) hereof, and the Company shall execute and the
Trustee shall authenticate and deliver to the Person designated in the
instructions a Definitive Note in the appropriate principal amount. Any
Definitive Note issued in exchange for a beneficial interest pursuant to this
Section 2.06(c)(iii) shall be registered in such name or names and in such
authorized denomination or denominations as the holder of such beneficial
interest shall instruct the Registrar through instructions from the Depositary
and the Participant or Indirect Participant. The Trustee shall deliver such
Definitive Notes to the Persons in whose names such Notes are so registered. Any
Definitive Note issued in exchange for a beneficial interest pursuant to this
Section 2.06(c)(iii) shall not bear the Private Placement Legend. A beneficial
interest in an Unrestricted Global Note cannot be exchanged for a Definitive
Note bearing the Private Placement Legend or transferred to a Person who takes
delivery thereof in the form of a Definitive Note bearing the Private Placement
Legend.

     (d) Transfer and Exchange of Definitive Notes for Beneficial Interests.

     (i) Restricted Definitive Notes to Beneficial Interests in Restricted
Global Notes. If any Holder of a Restricted Definitive Note proposes to exchange
such Note for a beneficial interest in a Restricted Global Note or to transfer
such Restricted Definitive Notes to a Person who takes delivery thereof in the
form of a beneficial interest in a Restricted Global Note, then, upon receipt by
the Registrar of the following documentation:

          (A) if the Holder of such Restricted Definitive Note proposes to
     exchange such Note for a beneficial interest in a Restricted Global Note, a
     certificate from such Holder in the form of Exhibit C hereto, including the
     certifications in item (2)(b) thereof;

          (B) if such Restricted Definitive Note is being transferred to a QIB
     in accordance with Rule 144A under the Securities Act, a certificate to the
     effect set forth in Exhibit B hereto, including the certifications in item
     (1) thereof;

          (C) if such Restricted Definitive Note is being transferred to a
     Non-U.S. Person in an offshore transaction in accordance with Rule 903 or
     Rule



                                      -31-


     904 under the Securities Act, a certificate to the effect set forth in
     Exhibit B hereto, including the certifications in item (2) thereof;

          (D) if such Restricted Definitive Note is being transferred pursuant
     to an exemption from the registration requirements of the Securities Act in
     accordance with Rule 144 under the Securities Act, a certificate to the
     effect set forth in Exhibit B hereto, including the certifications in item
     (3)(a) thereof;

          (E) if such Restricted Definitive Note is being transferred to an
     Institutional Accredited Investor in reliance on an exemption from the
     registration requirements of the Securities Act other than those listed in
     subparagraphs (B) through (D) above, a certificate to the effect set forth
     in Exhibit B hereto, including the certifications, certificates and Opinion
     of Counsel required by item (3) thereof, if applicable;

          (F) if such Restricted Definitive Note is being transferred to the
     Company or any of its Subsidiaries, a certificate to the effect set forth
     in Exhibit B hereto, including the certifications in item (3)(b) thereof;
     or

          (G) if such Restricted Definitive Note is being transferred pursuant
     to an effective registration statement under the Securities Act, a
     certificate to the effect set forth in Exhibit B hereto, including the
     certifications in item (3)(c) thereof,

the Trustee shall cancel the Restricted Definitive Note, increase or cause to be
increased the aggregate principal amount of, in the case of clause (A) above,
the appropriate Restricted Global Note, in the case of clause (B) above, the
144A Global Note, in the case of clause (C) above, the Regulation S Global Note,
and in the case of clause (E) above, the IAI Global Note.

     (ii) Restricted Definitive Notes to Beneficial Interests in Unrestricted
Global Notes. A Holder of a Restricted Definitive Note may exchange such Note
for a beneficial interest in an Unrestricted Global Note or transfer such
Restricted Definitive Note to a Person who takes delivery thereof in the form of
a beneficial interest in an Unrestricted Global Note only if:

          (A) such exchange or transfer is effected pursuant to the Exchange
     Offer in accordance with the Registration Rights Agreement and the Holder,
     in the case of an exchange, or the transferee, in the case of a transfer,
     certifies in the applicable Letter of Transmittal that it is not (1) a
     Broker-Dealer, (2) a Person participating in the distribution of the
     Exchange Notes or (3) a Person who is an affiliate (as defined in Rule 144)
     of the Company;

          (B) any such transfer is effected pursuant to the Shelf Registration
     Statement in accordance with the Registration Rights Agreement;



                                      -32-


          (C) any such transfer is effected by a Broker-Dealer pursuant to the
     Exchange Offer Registration Statement in accordance with the Registration
     Rights Agreement; or

          (D) the Registrar receives the following:

               (1) if the Holder of such Definitive Notes proposes to exchange
          such Notes for a beneficial interest in the Unrestricted Global Note,
          a certificate from such Holder in the form of Exhibit C hereto,
          including the certifications in item (1)(c) thereof; or

               (2) if the Holder of such Definitive Notes proposes to transfer
          such Notes to a Person who shall take delivery thereof in the form of
          a beneficial interest in the Unrestricted Global Note, a certificate
          from such Holder in the form of Exhibit B hereto, including the
          certifications in item (4) thereof;

     and, in each such case set forth in this subparagraph (D), if the Registrar
     so requests or if the Applicable Procedures so require, an Opinion of
     Counsel in form reasonably acceptable to the Company to the effect that
     such exchange or transfer is in compliance with the Securities Act, that
     the restrictions on transfer contained herein and in the Private Placement
     Legend are not required in order to maintain compliance with the Securities
     Act, and such Definitive Notes are being exchanged or transferred in
     compliance with any applicable blue sky securities laws of any State of the
     United States.

     Upon satisfaction of the conditions of any of the subparagraphs in this
Section 2.06(d)(ii), the Trustee shall cancel the Definitive Notes and increase
or cause to be increased the aggregate principal amount of the Unrestricted
Global Note.

     (iii) Unrestricted Definitive Notes to Beneficial Interests in Unrestricted
Global Notes. A Holder of an Unrestricted Definitive Note may exchange such Note
for a beneficial interest in an Unrestricted Global Note or transfer such
Definitive Notes to a Person who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note at any time. Upon receipt of
a request for such an exchange or transfer, the Trustee shall cancel the
applicable Unrestricted Definitive Note and increase or cause to be increased
the aggregate principal amount of one of the Unrestricted Global Notes.

     If any such exchange or transfer from a Definitive Note to a beneficial
interest is effected pursuant to subparagraphs (ii)(B), (ii)(D) or (iii) above
at a time when an Unrestricted Global Note has not yet been issued, the Company
shall issue and, upon receipt of an Authentication Order in accordance with
Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted
Global Notes in an aggregate principal amount equal to the principal amount of
Definitive Notes so transferred.

     (e) Transfer and Exchange of Definitive Notes for Definitive Notes. Upon
request by a Holder of Definitive Notes and such Holder's compliance with the
provisions of this Section 2.06(e), the Registrar shall register the transfer or
exchange of Definitive Notes. Prior to such



                                      -33-


registration of transfer or exchange, the requesting Holder shall present or
surrender to the Registrar the Definitive Notes duly endorsed or accompanied by
a written instruction of transfer in form satisfactory to the Registrar duly
executed by such Holder or by his attorney, duly authorized in writing. In
addition, the requesting Holder shall provide any additional certifications,
documents and information, as applicable, pursuant to the provisions of this
Section 2.06(e).

     (i) Restricted Definitive Notes to Restricted Definitive Notes. Any
Restricted Definitive Note may be transferred to and registered in the name of
Persons who take delivery thereof in the form of a Restricted Definitive Note if
the Registrar receives the following:

          (A) if the transfer will be made pursuant to Rule 144A under the
     Securities Act, then the transferor must deliver a certificate in the form
     of Exhibit B hereto, including the certifications in item (1) thereof;

          (B) if the transfer will be made pursuant to Rule 903 or Rule 904,
     then the transferor must deliver a certificate in the form of Exhibit B
     hereto, including the certifications in item (2) thereof; and

          (C) if the transfer will be made pursuant to any other exemption from
     the registration requirements of the Securities Act, then the transferor
     must deliver a certificate in the form of Exhibit B hereto, including the
     certifications, certificates and Opinion of Counsel required by item (3)
     thereof, if applicable.

     (ii) Restricted Definitive Notes to Unrestricted Definitive Notes. Any
Restricted Definitive Note may be exchanged by the Holder thereof for an
Unrestricted Definitive Note or transferred to a Person or Persons who take
delivery thereof in the form of an Unrestricted Definitive Note if:

          (A) such exchange or transfer is effected pursuant to the Exchange
     Offer in accordance with the Registration Rights Agreement and the Holder,
     in the case of an exchange, or the transferee, in the case of a transfer,
     certifies in the applicable Letter of Transmittal that it is not (1) a
     Broker-Dealer, (2) a Person participating in the distribution of the
     Exchange Notes or (3) a Person who is an affiliate (as defined in Rule 144)
     of the Company;

          (B) any such transfer is effected pursuant to the Shelf Registration
     Statement in accordance with the Registration Rights Agreement;

          (C) any such transfer is effected by a Broker-Dealer pursuant to the
     Exchange Offer Registration Statement in accordance with the Registration
     Rights Agreement; or

          (D) the Registrar receives the following:

               (1) if the Holder of such Restricted Definitive Notes proposes to
          exchange such Notes for an Unrestricted Definitive Note, a certificate


                                      -34-


          from such Holder in the form of Exhibit C hereto, including the
          certifications in item (1)(a) thereof; or

               (2) if the Holder of such Restricted Definitive Notes proposes to
          transfer such Notes to a Person who shall take delivery thereof in the
          form of an Unrestricted Definitive Note, a certificate from such
          Holder in the form of Exhibit B hereto, including the certifications
          in item (4) thereof;

     and, in each such case set forth in this subparagraph (D), if the Registrar
     so requests or the Applicable Procedures so require, an Opinion of Counsel
     in form reasonably acceptable to the Company to the effect that such
     exchange or transfer is in compliance with the Securities Act, that the
     restrictions on transfer contained herein and in the Private Placement
     Legend are not required in order to maintain compliance with the Securities
     Act, and such Restricted Definitive Note is being exchanged or transferred
     in compliance with any applicable blue sky securities laws of any State of
     the United States.

     (iii) Unrestricted Definitive Notes to Unrestricted Definitive Notes. A
Holder of Unrestricted Definitive Notes may transfer such Notes to a Person who
takes delivery thereof in the form of an Unrestricted Definitive Note. Upon
receipt of a request for such a transfer, the Registrar shall register the
Unrestricted Definitive Notes pursuant to the instructions from the Holder
thereof. Unrestricted Definitive Notes cannot be exchanged for or transferred to
Persons who take delivery thereof in the form of a Restricted Definitive Note.

     (f) Exchange Offer. Upon the consummation of an Exchange Offer, the Company
shall issue and, upon receipt of an Authentication Order in accordance with
Section 2.02, the Trustee shall authenticate (i) one or more Unrestricted Global
Notes in an aggregate principal amount equal to the principal amount of the
beneficial interests in the Restricted Global Notes tendered for acceptance by
Persons that certify in the applicable Letter of Transmittal that (x) they are
not Broker-Dealers, (y) they are not participating in the distribution of the
Exchange Notes or (z) they are not affiliates (as defined in Rule 144) of the
Company, and accepted for exchange in the Exchange Offer and (ii) Definitive
Notes in an aggregate principal amount equal to the principal amount of the
Restricted Definitive Notes accepted for exchange in the Exchange Offer.
Concurrently with the issuance of such Notes, the Trustee shall cause the
aggregate principal amount of the applicable Restricted Global Notes to be
reduced accordingly, and the Company shall execute and the Trustee shall
authenticate and deliver to the Persons designated by the Holders of Definitive
Notes so accepted Definitive Notes in the appropriate principal amount.

     (g) Legends. The following legends shall appear on the face of all Global
Notes and Definitive Notes issued under this Indenture unless specifically
stated otherwise in the applicable provisions of this Indenture.

     (i) Private Placement Legend.



                                      -35-


          (A) Except as permitted by subparagraph (B) below, each Global Note
     and each Definitive Note (and all Notes issued in exchange therefor or
     substitution thereof) shall bear the legend in substantially the following
     form:

          "THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT
          OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT
          BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT
          OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH BELOW. BY ITS
          ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (a) IT IS A
          "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
          SECURITIES ACT) OR (b) IT IS NOT A U.S. PERSON AND IS ACQUIRING THE
          NOTE EVIDENCED HEREBY IN AN OFFSHORE TRANSACTION, (2) AGREES THAT IT
          WILL NOT, WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS
          SECURITY RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (a) TO THE
          COMPANY OR ANY SUBSIDIARY THEREOF, (b) INSIDE THE UNITED STATES TO A
          QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE
          SECURITIES ACT, (c) INSIDE THE UNITED STATES TO AN ACCREDITED INVESTOR
          (AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES
          ACT) THAT, PRIOR TO SUCH TRANSFER, FURNISHES (OR HAS FURNISHED ON ITS
          BEHALF BY A U.S. BROKER-DEALER) TO THE TRUSTEE A SIGNED LETTER
          CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
          RESTRICTIONS ON TRANSFER OF THIS SECURITY (THE FORM OF WHICH LETTER
          CAN BE OBTAINED FROM THE TRUSTEE FOR THIS SECURITY), (d) OUTSIDE THE
          UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904
          OF REGULATION S UNDER THE SECURITIES ACT, (e) PURSUANT TO THE
          EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES
          ACT (IF AVAILABLE), OR (f) PURSUANT TO AN EFFECTIVE REGISTRATION
          STATEMENT UNDER THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE TO
          EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE
          SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY
          TRANSFER OF THIS SECURITY WITHIN ONE YEAR AFTER THE ORIGINAL ISSUANCE
          OF THIS SECURITY, IF THE PROPOSED TRANSFEREE IS AN ACCREDITED
          INVESTOR, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH THE TRUSTEE
          AND THE COMPANY SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER
          INFORMATION AS EITHER OF THEM MAY REASONABLY REQUIRE TO CONFIRM THAT
          SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A
          TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE


                                      -36-


          SECURITIES ACT. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION,"
          "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY
          REGULATION S UNDER THE SECURITIES ACT."

          (B) Notwithstanding the foregoing, any Global Note or Definitive Note
     issued pursuant to subparagraphs (b)(iv), (c)(ii), (c)(iii), (d)(ii),
     (d)(iii), (e)(ii), (e)(iii) or (f) to this Section 2.06 (and all Notes
     issued in exchange therefor or substitution thereof) shall not bear the
     Private Placement Legend.

     (ii) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:

     "THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
     GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
     BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
     CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS
     MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL
     NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a)
     OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE
     FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS
     GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR
     WRITTEN CONSENT OF THE COMPANY."

     (iii) Regulation S Temporary Global Note Legend. The Regulation S Temporary
Global Note shall bear a legend in substantially the following form:

     "THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
     CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES,
     ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER
     NOR THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL
     BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON."

     (h) Cancellation and/or Adjustment of Global Notes. At such time as all
beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
cancelled in whole and not in part, each such Global Note shall be returned to
or retained and cancelled by the Trustee in accordance with Section 2.11 hereof.
At any time prior to such cancellation, if any beneficial interest in a Global
Note is exchanged for or transferred to a Person who will take delivery thereof
in the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note shall be
reduced accordingly and an endorsement shall be made on such Global Note, by the
Trustee or by the Depositary at the direction of the Trustee, to



                                      -37-


reflect such reduction; and if the beneficial interest is being exchanged for or
transferred to a Person who will take delivery thereof in the form of a
beneficial interest in another Global Note, such other Global Note shall be
increased accordingly and an endorsement shall be made on such Global Note, by
the Trustee or by the Depositary at the direction of the Trustee, to reflect
such increase.

     (i) General Provisions Relating to Transfers and Exchanges.

          (i) To permit registrations of transfers and exchanges, the Company
     shall execute and the Trustee shall authenticate Global Notes and
     Definitive Notes upon Company's Order or at the Registrar's request.

          (ii) No service charge shall be made to a holder of a beneficial
     interest in a Global Note or to a Holder of a Definitive Note for any
     registration of transfer or exchange, but the Company may require payment
     of a sum sufficient to cover any transfer tax or similar governmental
     charge payable in connection therewith (other than any such transfer taxes
     or similar governmental charge payable upon exchange or transfer pursuant
     to Sections 2.10, 3.07, 3.10, 4.16 and 9.05 hereof).

          (iii) The Registrar shall not be required to register the transfer of
     or exchange any Note selected for redemption in whole or in part, except
     the unredeemed portion of any Note being redeemed in part.

          (iv) All Global Notes and Definitive Notes issued upon any
     registration of transfer or exchange of Global Notes or Definitive Notes
     shall be the valid obligations of the Company, evidencing the same debt,
     and entitled to the same benefits under this Indenture, as the Global Notes
     or Definitive Notes surrendered upon such registration of transfer or
     exchange.

          (v) The Company shall not be required (A) to issue, to register the
     transfer of or to exchange Notes during a period beginning at the opening
     of business 15 days before the day of any selection of Notes for redemption
     under Section 3.03 hereof and ending at the close of business on the day of
     selection, (B) to register the transfer of or to exchange any Note so
     selected for redemption in whole or in part, except the unredeemed portion
     of any Note being redeemed in part or (C) to register the transfer of or to
     exchange a Note between a record date and the next succeeding Interest
     Payment Date.

          (vi) Prior to due presentment for the registration of a transfer of
     any Note, the Trustee, any Agent and the Company may deem and treat the
     Person in whose name any Note is registered as the absolute owner of such
     Note for the purpose of receiving payment of principal of and interest on
     such Notes and for all other purposes, and none of the Trustee, any Agent
     or the Company shall be affected by notice to the contrary.

          (vii) The Trustee shall authenticate Global Notes and Definitive Notes
     in accordance with the provisions of Section 2.02 hereof.



                                      -38-


          (viii) All certifications, certificates and Opinions of Counsel
     required to be submitted to the Registrar pursuant to this Section 2.06 to
     effect a transfer or exchange may be submitted by facsimile.

SECTION 2.07.  Replacement Notes

     If any mutilated Note is surrendered to the Trustee or the Company or the
Trustee and the Company receive evidence to their satisfaction of the
destruction, loss or theft of any Note, the Company shall issue and the Trustee,
upon the written order of the Company signed by two Officers of the Company,
shall authenticate a replacement Note if the Trustee's and the Company's
requirements are met. If required by the Trustee or the Company, an indemnity
bond must be supplied by the Holder that is sufficient in the judgment of the
Trustee and the Company to protect the Company, the Trustee, any Agent and any
authenticating agent from any loss that any of them may suffer if a Note is
replaced. The Company and the Trustee may charge for their expenses in replacing
a Note. If after the delivery of such new Note, a bona fide purchaser of the
original Note in lieu of which such new Note was issued presents for payment
such original Note, the Company and the Trustee shall be entitled to recover
such new Note from the person to whom it was delivered or any transferee
thereof, except a bona fide purchaser, and shall be entitled to recover upon the
security or indemnity provided therefor to the extent of any loss, damage, cost
or expense incurred by the Company or the Trustee in connection therewith.

     Every replacement Note is an additional obligation of the Company and shall
be entitled to all the benefits of this Indenture equally and proportionately
with any and all other Notes duly issued hereunder.

SECTION 2.08.  Outstanding Notes

     The Notes outstanding at any time are all the Notes authenticated by the
Trustee except for those cancelled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee hereunder in accordance with the provisions hereof, and those described
in this Section 2.08 as not outstanding. Except as set forth in Section 2.09
hereof, a Note does not cease to be outstanding because either of the Company or
an Affiliate of the Company holds a Note.

     If a Note is replaced pursuant to Section 2.07 hereof, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.

     If the principal amount of any Note is considered paid under Section 4.01
hereof, it ceases to be outstanding and interest on it ceases to accrue.

     If the Paying Agent segregates and holds in trust, in accordance with this
Indenture, on the Redemption Date or maturity date, money sufficient to pay all
principal, premium, if any, interest and Liquidated Damages, if any, payable on
that date on the Notes (or the portion thereof to be redeemed or maturing, as
the case may be), then on and after that date such Notes (or a portion thereof)
shall be deemed to be no longer outstanding and shall cease to accrue interest.



                                      -39-


SECTION 2.09.  Treasury Notes

     In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company or any Affiliate of the Company, shall be considered as though not
outstanding, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Notes that a Responsible Officer of the Trustee actually knows are so owned
shall be so disregarded. The Company shall notify the Trustee, in writing, when
the Company or any of its Affiliates repurchases or otherwise acquires Notes and
the aggregate principal amount of such Notes so repurchased or otherwise
acquired.

SECTION 2.10.  Temporary Notes

     Until certificates representing Notes are ready for delivery, the Company
may prepare and the Trustee upon receipt of an Authentication Order, shall
authenticate and deliver temporary Notes. Temporary Notes shall be substantially
in the form of definitive Notes but may have variations that the Company and the
Trustee consider appropriate for temporary Notes. Without unreasonable delay,
upon receipt of an Authentication Order, the Company shall prepare and the
Trustee shall authenticate and deliver definitive Notes in exchange for
temporary Notes.

     Holders of temporary Notes shall be entitled to all of the rights, benefits
and privileges of this Indenture.

SECTION 2.11.  Cancellation

     The Company at any time may deliver Notes to the Trustee for cancellation.
The Registrar and Paying Agent shall forward to the Trustee any Notes
surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation, except as expressly
permitted by this Indenture. The Company may not issue new Notes to replace
Notes that it has redeemed or paid or that have been delivered to the Trustee
for cancellation. All cancelled Notes held by the Trustee shall be destroyed
(subject to the record retention requirement of the Exchange Act). Certification
of the destruction of all cancelled Notes shall be delivered to the Company. The
Company may not issue new Notes to replace Notes that it has paid or that have
been delivered to the Trustee for cancellation.

SECTION 2.12.  Defaulted Interest

     Interest on any Note which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall be paid to the Person in whose
name that Note is registered at the close of business on the Regular Record Date
for such interest.

     Any interest on any Note which is payable, but is not punctually paid or
duly provided for, on any Interest Payment Date and interest on such defaulted
interest at the applicable interest rate borne by the Notes, to the extent
lawful (such defaulted interest (and interest thereon) herein collectively
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder; and
such Defaulted Interest shall be paid by the Company to the Persons in whose
names the Notes are registered at the close



                                      -40-


of business on a Special Record Date for the payment of such Defaulted Interest,
which shall be fixed in the following manner. The Company shall give the Trustee
at least 15 days' written notice (unless a shorter period is acceptable to the
Trustee for its convenience) of the amount of Defaulted Interest proposed to be
paid on each Note and the date of the proposed payment, and at the same time the
Company shall deposit with the Trustee an amount of money equal to the aggregate
amount proposed to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the date of
the proposed payment, such money when deposited to be held by the Trustee in
trust for the benefit of the Persons entitled to such Defaulted Interest as is
provided in this Section 2.12. Thereupon the Trustee shall fix a Special Record
Date for the payment of such Defaulted Interest which shall not be more than 15
days and not less than 10 days prior to the date of the proposed payment and not
less than 10 days after the receipt by the Trustee of the notice of the proposed
payment. The Trustee shall promptly notify the Company of such Special Record
Date. In the name and at the expense of the Company, the Trustee shall cause
notice of the proposed payment of such Defaulted Interest and the Special Record
Date therefor to be mailed, first-class postage prepaid, to each Holder at his
address as it appears in the Registrar, not less than 10 days prior to such
Special Record Date. Notice of the proposed payment of such Defaulted Interest
and the Special Record Date therefor having been so mailed, such Defaulted
Interest shall be paid to the Persons in whose names the Notes are registered at
the close of business on such Special Record Date.

     Subject to the foregoing provisions of this Section 2.12, each Note
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Note shall carry the rights to interest accrued and
unpaid, and to accrue, which were carried by such other Note.

SECTION 2.13.  CUSIP Number

     The Company in issuing the Notes shall use a CUSIP number, and the Trustee
shall use the CUSIP number in notices of redemption or exchange as a convenience
to Holders of Notes; provided, however, that no representation is hereby deemed
to be made by the Trustee as to the correctness or accuracy of the CUSIP number
printed in the notice or on the certificates representing the Notes, and that
reliance may be placed only on the other identification numbers printed on the
certificates representing the Notes. The Company will promptly notify the
Trustee of any change in a CUSIP number.

SECTION 2.14. Deposit of Moneys

     On each Interest Payment Date and each date on which payments in respect of
the Notes are required to be made pursuant to the terms of this Indenture, the
Company shall, not later than 12:00 noon (New York City time), deposit with the
Paying Agent in immediately available funds money sufficient to make any cash
payments due on such date in a timely manner which permits the Paying Agent to
remit payment to the Holders on such date.

SECTION 2.15.  Issuance of Additional Notes

     The Company shall be entitled to issue Additional Notes under this
Indenture which shall have identical terms as the Notes issued on November 21,
2001, other than with respect to the



                                      -41-


date of issuance, issue price and amount of interest payable on the first
payment date applicable thereto (and, if such Additional Notes shall be issued
in the form of Exchange Notes, other than with respect to transfer
restrictions); provided, that such issuance is not prohibited by Section 4.09
hereof.

     With respect to any Additional Notes, the Company shall set forth in a
resolution of the Board of Directors and in an Officers' Certificate, a copy of
each which shall be delivered to the Trustee, the following information:

          (A) the aggregate principal amount of such Additional Notes to be
     authenticated and delivered pursuant to this Indenture;

          (B) the issue price, the issue date and the CUSIP number of such
     Additional Notes and the amount of interest payable on the first payment
     date applicable thereto; provided, however, that no Additional Notes may be
     issued at a price that would cause such Additional Notes to have "original
     issue discount" within the meaning of Section 1273 of the Code;

          (C) whether such Additional Notes shall be transfer restricted
     securities and issued in the form of Notes or shall be registered
     securities issued in the form of Exchange Notes as set forth in Section
     2.06 hereof; and

     Any Additional Notes shall vote, together with any Notes previously issued
pursuant to this Indenture, as one class for all matters.

                                   ARTICLE 3



                       REDEMPTION AND OFFERS TO PURCHASE

SECTION 3.01.  Applicability of Article

     Redemption of Notes at the election of the Company shall be made in
accordance with this Article 3.

SECTION 3.02.  Election to Redeem; Notice to Trustee

     The election of the Company to redeem any Notes pursuant to Section 3.08
hereof shall be evidenced by a Board Resolution. In case of any redemption at
the election of the Company, the Company shall, simultaneously with providing
the notice to Holders specified in Section 3.08 hereof, notify the Trustee of
such Redemption Date and of the principal amount of Notes intended to be
redeemed.

SECTION 3.03.  Selection of Notes to Be Redeemed

     If less than all of the Notes are to be redeemed at any time, selection of
Notes for redemption shall be made by the Trustee in compliance with the
requirements of the principal national securities exchange, if any, on which the
Notes are listed or, if the Notes are not so



                                      -42-


listed, on a pro rata basis, by lot or by such method as the Trustee shall deem
fair and appropriate; provided that no Notes of $1,000 or less shall be redeemed
in part.

     The Trustee shall promptly notify the Company and the Registrar (if other
than the Trustee) in writing of the Notes selected for redemption and, in the
case of any Notes selected for partial redemption, the principal amount thereof
to be redeemed.

     For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to redemption of Notes shall relate, in the case of any
Note redeemed or to be redeemed only in part, to the portion of the principal
amount of such Note which has been or is to be redeemed.

SECTION 3.04.  Notice of Redemption

     Notices of redemption shall be mailed by first class mail, postage prepaid,
at least 30 but not more than 60 days before the Redemption Date to each Holder
of Notes to be redeemed at such Holder's registered address. If any Note is to
be redeemed in part only, the notice of redemption that relates to such Note
shall state the portion of the principal amount thereof to be redeemed.

     All notices of redemption shall state:

     (1) the Redemption Date;

     (2) the Redemption Price, separately stating the amount of any accrued and
unpaid interest and Liquidated Damages, if any, to be paid in connection with
the redemption;

     (3) if less than all Notes then outstanding are to be redeemed, the
identification (and, in the case of a Note to be redeemed in part, principal
amount) of such Note to be redeemed;

     (4) that on the Redemption Date the Redemption Price, plus accrued and
unpaid interest and Liquidated Damages, if any, thereon to the Redemption Date,
will become due and payable upon each such Note or portion thereof, and that
(unless the Company shall default in payment of the Redemption Price and accrued
interest and Liquidated Damages, if any, thereon) interest thereon shall cease
to accrue on or after said date;

     (5) the place or places where such Notes are to be surrendered for payment
of the Redemption Price and accrued interest and Liquidated Damages, if any,
thereon;

     (6) that Notes called for redemption must be surrendered to the Paying
Agent to collect the Redemption Price, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the Redemption Date;

     (7) the CUSIP number, if any, relating to such Notes; and



                                      -43-


     (8) in the case of a Note to be redeemed in part, the principal amount of
such Note to be redeemed and that after the Redemption Date upon surrender of
such Note, a new Note or Notes in the aggregate principal amount equal to the
unredeemed portion thereof will be issued.

     At the Company's request, the Trustee shall give the notice of redemption
in the name of the Company and at the Company's expense: provided, however, that
the Company shall deliver to the Trustee, at least 5 business days prior to the
date the Company is requesting notice be given to the Holders (unless a shorter
notice period shall be satisfactory to the Trustee for its convenience), an
Officers' Certificate requesting that the Trustee give such notice and setting
forth the information to be stated in such notice as provided in the preceding
paragraph.

SECTION 3.05. Deposit of Redemption Price

     On or prior to any Redemption Date, the Company shall deposit with the
Trustee (to the extent not already held by the Trustee) or with the Paying Agent
an amount of money in same day funds (or New York Clearing House funds if such
deposit is made prior to the applicable Redemption Date) sufficient to pay the
Redemption Price of, and accrued and interest and Liquidated Damages, if any, to
the Redemption Date, on all Notes or portions thereof which are to be redeemed
on that date.

SECTION 3.06.  Notes Payable on Redemption Date

     Notice of redemption having been given as aforesaid, the Notes so to be
redeemed shall, on the Redemption Date, become due and payable at the Redemption
Price therein specified, plus accrued and unpaid interest and Liquidated
Damages, if any, thereon to the Redemption Date, and from and after such date
(unless the Company shall default in the payment of the Redemption Price and
accrued interest and Liquidated Damages, if any, thereon) such Notes shall cease
to bear interest and Liquidated Damages, if any. Any such Note surrendered for
redemption in accordance with said notice shall be paid by the Company at the
Redemption Price, plus accrued and unpaid interest and Liquidated Damages, if
any, thereon to the Redemption Date; provided, however, that installments of
interest and Liquidated Damages, if any, whose Stated Maturity is on or prior to
the Redemption Date shall be payable to the Holders of such Notes, registered as
such on the relevant Regular Record Dates according to the terms and provisions
of Section 2.12 hereof.

     If any Note called for redemption shall not be so paid in accordance with
the terms hereof, the principal thereof (and premium, if any, thereon) shall,
until paid, bear interest and Liquidated Damages, if any, from the Redemption
Date at the rate borne by such Note.

SECTION 3.07.  Notes Redeemed in Part

     Any Note which is to be redeemed only in part shall be surrendered at the
office or agency of the Company maintained for such purpose pursuant to Section
4.02 hereof (with, if the Company, the Registrar or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company, the Registrar or the Trustee duly executed by, the Holder thereof or
his attorney duly authorized in writing), and a new Note in principal amount
equal to the unredeemed portion will be issued in the name of the Holder thereof
upon



                                      -44-


cancellation of the original Note. On and after the Redemption Date, unless the
Company defaults in payment of the Redemption Price and accrued interest and
Liquidated Damages, if any, thereon, interest and Liquidated Damages, if any,
shall cease to accrue on Notes or portions thereof called for redemption.

SECTION 3.08.  Optional Redemption

     Except as described below, the Notes are not redeemable at the Company's
option prior to May 15, 2004. Thereafter, the Notes will be subject to
redemption at any time at the option of the Company, in whole or in part, upon
not less than 30 nor more than 60 days' notice, at the redemption prices
(expressed as percentages of principal amount) set forth below, plus accrued and
unpaid interest and Liquidated Damages, if any, thereon to the applicable
Redemption Date, if redeemed during the twelve-month period beginning on May 15
of the years indicated below:

            Year                               Percentage
            ----                               ----------

            2004 ...........................    104.375%
            2005 ...........................    102.916%
            2006 ...........................    101.458%
            2007 and thereafter ............    100.000%

     Notwithstanding the foregoing, at any time on or prior to May 15, 2002, the
Company may on any one or more occasions redeem up to 35% of the aggregate
principal amount of the Notes theretofore issued under this Indenture at a
redemption price equal to 108.75% of the principal amount thereof, plus accrued
and unpaid interest and Liquidated Damages, if any, thereon, to the Redemption
Date, with the net cash proceeds of one or more Equity Offerings; provided that
(i) at least 65% of the aggregate principal amount of the Notes theretofore
issued remain outstanding immediately following each such redemption and (ii)
such redemption shall occur within 60 days of the closing of any such Equity
Offering.

     In addition, at any time prior to May 15, 2004, following the occurrence of
a Change of Control, the Notes will be subject to redemption at the option of
the Company, in whole or in part, upon not less than 30 nor more than 60 days'
notice given within 30 days following such Change of Control, at the Make-Whole
Price, plus accrued and unpaid interest and Liquidated Damages, if any, thereon
to the applicable Redemption Date.

SECTION 3.09. Mandatory Redemption

     Except as set forth under Sections 3.10, 4.16 and 4.17 hereof, the Company
shall not be required to make any mandatory redemption or sinking fund payments
with respect to the Notes.

SECTION 3.10.  Offer to Purchase by Application of Excess Proceeds

     In the event that, pursuant to Section 4.16 hereof, the Company shall be
required to make an offer to all Holders of Notes to purchase Notes (an "Asset
Sale Offer"), it shall follow the procedures specified below.



                                      -45-


     The Asset Sale Offer shall remain open for at least 30 and not more than 40
days, except to the extent that a longer period is required by applicable law
(the "Offer Period"). On a date within five Business Days after the termination
of the Offer Period (the "Purchase Date"), the Company shall purchase the
principal amount of Notes required to be purchased pursuant to Section 4.16
hereof (the "Offer Amount") or, if less than the Offer Amount has been tendered,
all Notes tendered in response to the Asset Sale Offer.

     The Company shall comply with any tender offer rules under the Exchange Act
which may then be applicable, including Rule 14e-1, in connection with any offer
required to be made by the Company to repurchase the Notes as a result of an
Asset Sale Offer.

     If the Purchase Date is on or after a Regular Record Date and on or before
the related Interest Payment Date, any accrued and unpaid interest and
Liquidated Damages, if any, shall be paid to the Person in whose name a Note is
registered at the close of business on such Regular Record Date, and no
additional interest or Liquidated Damages, if any, shall be payable to Holders
who tender Notes pursuant to the Asset Sale Offer.

     Upon the commencement of an Asset Sale Offer, the Company shall send, by
first class mail, a notice to each of the Holders, with a copy to the Trustee.
The notice shall contain all instructions and materials necessary to enable such
Holders to tender Notes pursuant to the Asset Sale Offer. The Asset Sale Offer
shall be made to all Holders. The notice, which shall govern the terms of the
Asset Sale Offer, shall state:

     (a) that the Asset Sale Offer is being made pursuant to this Section 3.10
and Section 4.16 hereof and the length of time the Asset Sale Offer shall remain
open;

     (b) the Offer Amount, the purchase price, separately stating the amount of
any accrued and unpaid interest and Liquidated Damages, if any, and the Purchase
Date;

     (c) that any Note not tendered or accepted for payment shall remain
outstanding and continue to accrue interest and Liquidated Damages, if any;

     (d) that, unless the Company defaults in making such payment, any Note
accepted for payment pursuant to the Asset Sale Offer shall cease to accrue
interest or Liquidated Damages, if any, on the Purchase Date;

     (e) that Holders electing to have a Note purchased pursuant to any Asset
Sale Offer shall be required to surrender the Note, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Note completed, or
transfer by book-entry transfer, to the Company, a depositary, if appointed by
the Company, or a Paying Agent at the address specified in the notice not later
than the last Business Day of the Offer Period;

     (f) that Holders shall be entitled to withdraw their tendered Notes and
their election to require the Company to purchase such Notes, provided that the
Company, the depositary or the Paying Agent, as the case may be, receives, not
later than the close of business on the last Business Day of the Offer Period, a
telegram, telex, facsimile transmission or letter setting forth the name of the
Holder, the principal amount of the



                                      -46-


Notes the Holder tendered for purchase, and a statement that such Holder is
withdrawing his tendered Notes and his election to have such Notes purchased;

     (g) that, if the aggregate principal amount of Notes properly tendered by
Holders exceeds the Offer Amount, the Trustee shall select the Notes to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Trustee so that only Notes in denominations of $1,000, or
integral multiples thereof, shall be purchased); and

     (h) that Holders whose Notes are being purchased only in part shall be
issued new Notes equal in principal amount to the unpurchased portion of the
Notes surrendered (or transferred by book-entry transfer).

     On or before noon (New York City time) on each Purchase Date, the Company
shall irrevocably deposit with the Trustee or Paying Agent in immediately
available funds the aggregate purchase price with respect to a principal amount
of Notes equal to the Offer Amount (of, if less than the Offer Amount has been
properly tendered, such lesser amount as shall equal the principal amount of
Notes properly tendered), together with accrued and unpaid interest and
Liquidated Damages, if any, thereon to the Purchase Date, to be held for payment
in accordance with the terms of this Section 3.10. On the Purchase Date, the
Company shall, to the extent lawful, (i) accept for payment, on a pro rata basis
to the extent necessary, the Offer Amount of Notes or portions thereof tendered
pursuant to the Asset Sale Offer, or if less than the Offer Amount has been
tendered, all Notes tendered, (ii) deliver or cause the Paying Agent or
depositary, as the case may be, to deliver to the Trustee Notes so accepted and
(iii) deliver to the Trustee an Officers' Certificate stating that such Notes or
portions thereof were accepted for payment by the Company in accordance with the
terms of this Section 3.10. The Company, the depositary or the Paying Agent, as
the case may be, shall promptly (but in any case not later than three Business
Days after the Purchase Date) mail or deliver to each tendering Holder whose
Notes are to be purchased an amount equal to the purchase price of the Notes
tendered by such Holder and accepted by the Company for purchase, plus accrued
and unpaid interest and Liquidated Damages, if any, thereon to the Purchase
Date, and the Company shall promptly issue a new Note, and the Trustee, upon
written request from the Company, shall authenticate and mail or deliver such
new Note to such Holder, equal in principal amount to any unpurchased portion of
the Note surrendered. Any Note not so accepted shall be promptly mailed or
delivered by the Company to the Holder thereof.

                                   ARTICLE 4

                                   COVENANTS

SECTION 4.01.  Payment of Notes

     The Company shall pay or cause to be paid the principal of, premium, if
any, and interest on, the Notes on the dates and in the manner provided in the
Notes and in this Indenture. Principal, premium, if any, and interest shall be
considered paid on the date due if the Paying Agent, if other than the Company
or any of its Subsidiaries or Affiliates, holds as of 12:00 noon (New York City
time) on the due date money deposited by the Company in immediately



                                      -47-


available funds and designated for and sufficient to pay all principal, premium
and interest then due. The Company shall pay all Liquidated Damages, if any, in
the same manner on the dates and in the amounts set forth in the Registration
Rights Agreement. If any Liquidated Damages become payable, the Company shall
not later than three Business Days prior to the date that any payment of
Liquidated Damages is due (i) deliver an Officers' Certificate to the Trustee
setting forth the amount of Liquidated Damages payable to Holders and (ii)
instruct the Paying Agent to pay such amount of Liquidated Damages to Holders
entitled to receive such Liquidated Damages.

     The Company shall pay interest (including post-petition interest under any
Bankruptcy Law) on overdue principal and premium, if any, from time to time on
demand at a rate equal to 1% per annum in excess of the then applicable interest
rate on the Notes to the extent lawful; the Company shall pay interest
(including post-petition interest under any Bankruptcy Law) on overdue
installments of interest and Liquidated Damages (without regard to any
applicable grace period) from time to time on demand at the same rate to the
extent lawful. Interest will be computed on the basis of a 360-day year
comprised of twelve 30-day months.

SECTION 4.02.  Maintenance of Office or Agency

     The Company will maintain, in The City of New York, an office or agency
(which may be an office of the Trustee or Registrar) where Notes may be
presented or surrendered for payment, where Notes may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Company in respect of the Notes and this Indenture may be served. The
Company will give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee, and the Company hereby appoints the Trustee as its agent to receive all
such presentations, surrenders, notices and demands.

     The Company may from time to time designate one or more other offices or
agencies (in or outside of The City of New York) where the Notes may be
presented or surrendered for any or all such purposes, and may from time to time
rescind such designations; provided, however, that no such designation or
rescission shall in any manner relieve the Company of its obligation to maintain
an office or agency in The City of New York for such purposes. The Company will
give prompt written notice to the Trustee of any such designation or rescission
and of any change in the location of any such other office or agency.

SECTION 4.03.  Money for Security Payments to be Held in Trust

     Whenever the Company shall have one or more Paying Agents for the Notes, it
will, on or before each due date of the principal of, premium, if any, or
interest or Liquidated Damages, if any, on any Notes, deposit with a Paying
Agent a sum in same day funds (or New York Clearing House funds if such deposit
is made prior to the date on which such deposit is required to be made)
sufficient to pay the principal, premium, if any, or interest or Liquidated
Damages, if any, so becoming due (or at the option of the Company, payment of
interest and Liquidated Damages, if any, may be made by check mailed to the
Holders of the Notes at their respective addresses set



                                      -48-


forth in the register of Holders of Notes; provided that all payments on the
Global Notes and all payments of interest and Liquidated Damages, if any, on the
Definitive Notes, the holders of which have given wire transfer instructions to
the Company or the Paying Agent at least ten Business Days prior to the
applicable payment date, shall be made by wire transfer in same day funds), such
sum to be held in trust for the benefit of the Persons entitled to such
principal, premium or interest or Liquidated Damages, if any, and (unless such
Paying Agent is the Trustee) the Company will promptly notify the Trustee of
such action or any failure so to act.

     The Company will cause each Paying Agent other than the Trustee to execute
and deliver to the Trustee an instrument in which such Paying Agent shall agree
with the Trustee, subject to the provisions of this Section 4.03, that such
Paying Agent will:

     (a)  hold all sums held by it for the payment of the principal of, premium,
          if any, or interest or Liquidated Damages, if any, on Notes in trust
          for the benefit of the Persons entitled thereto until such sums shall
          be paid to such Persons or otherwise disposed of as herein provided;

     (b)  give the Trustee notice of any default by the Company (or any other
          obligor upon the Notes) in the making of any payment of principal,
          premium, if any, or interest or Liquidated Damages, if any;

     (c)  at any time during the continuance of any such default, upon the
          written request of the Trustee, forthwith pay to the Trustee all sums
          so held in trust by such Paying Agent; and

     (d)  acknowledge, accept and agree to comply in all respects with the
          provisions of this Indenture relating to the duties, rights and
          obligations of such Paying Agent.

     The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
money.

     Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of, premium, if any, or
interest or Liquidated Damages, if any, on any Note and remaining unclaimed for
two years after such principal, premium, if any, or interest or Liquidated
Damages, if any, has become due and payable shall be paid to the Company on
Company Request or (if then held by the Company) shall be discharged from such
trust; and the Holder of such Note shall thereafter, as an unsecured general
creditor, look only to the Company for payment thereof, and all liability of the
Trustee or such Paying Agent with respect to such trust money, and all liability
of the Company as trustee thereof, shall thereupon cease; provided, however,
that the Trustee or such Paying Agent, before being required to make any such
repayment, shall at the expense of the Company cause notice to be



                                      -49-


promptly sent to each Holder that such money remains unclaimed and that, after a
date specified therein, which shall not be less than 30 days from the date of
such notification, any unclaimed balance of such money then remaining will be
repaid to the Company.

SECTION 4.04. Reports

     (a) Whether or not required by the rules and regulations of the SEC, so
long as any Notes are outstanding, the Company shall furnish to the Holders of
Notes (i) all quarterly and annual financial information that would be required
to be contained in a filing with the SEC on Forms 10-Q and 10-K if the Company
were required to file such Forms and, with respect to the annual information
only, a report thereon by the Company's certified independent accountants and
(ii) all current reports that would be required to be filed with the SEC on Form
8-K if the Company were required to file such reports. In addition, whether or
not required by the rules and regulations of the SEC, the Company shall file a
copy of all such information and reports with the SEC for public availability
(unless the SEC will not accept such a filing) and make such information
available to securities analysts and prospective investors upon request. The
Company and its Restricted Subsidiaries shall, for so long as any Notes remain
outstanding, furnish to the Holders and to securities analysts and prospective
investors, upon their request, the information required to be delivered pursuant
to Rule 144A(d)(4) under the Securities Act. The Company shall also comply with
the provisions of TIA ss. 314(a).

     (b) If the Company instructs the Trustee to distribute any of the documents
described in clause (a) above to the Holders of Notes, the Company shall provide
the Trustee with a sufficient number of copies of all documents that the Company
may be required to deliver to the Holders of Notes under this Section 4.04. Any
such distribution by the Trustee pursuant to this clause (b) shall be at the
expense of the Company.

SECTION 4.05.  Compliance Certificate

     (a) The Company and each Guarantor shall deliver to the Trustee, within 120
days after the end of each fiscal year ending after the date hereof, an
Officers' Certificate stating, as to each Officer signing such certificate, that
to the best of his or her knowledge each entity is not in default in the
performance or observance of any terms, provisions and conditions of this
Indenture (or, if a Default or Event of Default shall exist, describing all such
Defaults or Events of Default of which he or she may have knowledge and what
action the Company is taking or proposes to take with respect thereto) and that
to the best of his or her knowledge no event has occurred and remains in
existence by reason of which payments on account of the principal of or interest
or Liquidated Damages, if any, on the Notes is prohibited or if such event has
occurred, a description of the event and what action the Company is taking or
proposes to take with respect thereto. For purposes of this Section 4.05, such
compliance shall be determined without regard to any period of grace or
requirement of notice under this Indenture.

     (b) The Company will, so long as any of the Notes are outstanding within
five Business Days, upon becoming aware of any Default or Event of Default,
deliver to the Trustee an Officers' Certificate specifying such Default, Event
of Default and what action the Company is taking or proposes to take with
respect thereto.



                                      -50-


SECTION 4.06.  Taxes

     The Company shall pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (a) all material taxes, assessments and
governmental charges levied or imposed upon it or any Subsidiary or upon the
income, profits or property of the Company or any of its Subsidiaries and (b)
all material lawful claims for labor, materials and supplies, which, if unpaid,
might by law become a Lien upon the property of the Company or any of its
Subsidiaries that could produce a material adverse effect on the consolidated
financial condition of the Company; provided, however, that the Company shall
not be required to pay or discharge or cause to be paid or discharged any such
tax, assessment, charge or claim whose amount, applicability or validity is
being contested in good faith by appropriate proceedings and in respect of which
appropriate reserves (in the good faith judgment of management of the Company)
are being maintained in accordance with GAAP.

SECTION 4.07.  Stay, Extension and Usury Laws

     The Company covenants (to the extent that it may lawfully do so) that it
shall not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it shall not, by resort to any such law, hinder, delay
or impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law has
been enacted.

SECTION 4.08.  Corporate Existence; Maintenance of Properties and Insurance

     Subject to Article 5 hereof, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect (i) its corporate
existence, and the corporate, partnership or other existence of each of its
Restricted Subsidiaries, in accordance with the respective organizational
documents (as the same may be amended from time to time) of the Company or any
such Restricted Subsidiary and (ii) its (and its Restricted Subsidiaries')
rights (charter and statutory), licenses and franchises; provided, however, that
the Company shall not be required to preserve any such right, license or
franchise, or the corporate, partnership or other existence of any of its
Restricted Subsidiaries, if the Board of Directors or management of the Company
shall determine in good faith that the preservation thereof is no longer
desirable in the conduct of the business of the Company and its Subsidiaries,
taken as a whole, and that the loss thereof is not adverse in any material
respect to the Holders of Notes.

     With such exceptions, if any, as are not material in the aggregate and are
not adverse in any material respect to the Holders of Notes, the Company shall,
and shall cause each of its Subsidiaries to, maintain its properties in good
working order and condition (subject to ordinary wear and tear) and make all
reasonably necessary repairs, renewals, replacements, additions and improvements
required for it to actively conduct and carry on its business.

     The Company shall maintain insurance against loss or damage of the kinds
that, in the good faith judgment of the Company, are adequate and appropriate
for the conduct of the



                                      -51-


business of the Company and its Subsidiaries in a prudent manner, with reputable
insurers or with the government of the United States of America or an agency or
instrumentality thereof, in such amounts, with such deductibles, and by such
methods as shall be customary, in the good faith judgment of the Company, for
companies similarly situated in the industry.

SECTION 4.09. Limitation on the Incurrence of Indebtedness and Issuance of
              Preferred Stock

     The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Debt) and the Company shall not permit any of its Restricted Subsidiaries to
issue any shares of Preferred Stock (other than to the Company or a Restricted
Subsidiary of the Company); provided, however, that the Company and the
Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) if the
Consolidated Interest Coverage Ratio for the Company's most recently ended four
full fiscal quarters for which internal financial statements are available
immediately preceding the date on which such additional Indebtedness is incurred
would have been equal to or greater than 2 to 1, determined on a pro forma
basis, as if the additional Indebtedness had been incurred at the beginning of
such four-quarter period and no Event of Default shall have occurred and be
continuing after giving effect on a pro forma basis to such incurrence.

     The provisions of the first paragraph of this Section 4.09 will not apply
to the incurrence of any of the following items of Indebtedness (collectively,
"Permitted Debt"):

          (i) the incurrence by the Company and its Restricted Subsidiaries of
     Indebtedness under the Credit Agreement in an aggregate amount outstanding
     (with letters of credit being deemed for all purposes of this Indenture to
     have a principal amount equal to the maximum potential liability of the
     Company and its Restricted Subsidiaries in respect thereof) at any time not
     to exceed the greater of (x) $450 million and (y) 3.5 times Consolidated
     Resort EBITDA for the Company's most recently ended four full fiscal
     quarters for which internal financial statements are available immediately
     preceding the date on which such Indebtedness is being incurred less, in
     each case, the aggregate amount of such Indebtedness permanently repaid
     with the Net Proceeds of any Asset Sale;

          (ii) the incurrence by the Company and its Restricted Subsidiaries of
     Indebtedness represented by (x) the Notes (including the Exchange Notes),
     the Guarantees thereof and this Indenture in the principal amount of Notes
     originally issued on the Closing Date and (y) the Existing Notes, the
     Guarantees thereof and the Existing Note Indenture;

          (iii) the incurrence by the Company and its Restricted Subsidiaries of
     the Existing Indebtedness;

          (iv) the incurrence by the Company and its Restricted Subsidiaries of
     additional Indebtedness (other than Hedging Obligations) after May 11, 1999
     in an aggregate principal amount not to exceed $50 million at any time
     outstanding;



                                      -52-


          (v) the incurrence by the Company and its Restricted Subsidiaries of
     Indebtedness after May 11, 1999 in connection with the acquisition of
     assets or a new Restricted Subsidiary (including Indebtedness that was
     incurred by the prior owner of such assets or by such Restricted Subsidiary
     prior to such acquisition by the Company and its Restricted Subsidiaries);
     provided that the aggregate principal amount of Indebtedness incurred after
     May 11, 1999 pursuant to this clause (v) does not exceed $20 million at any
     time outstanding;

          (vi) the incurrence by the Company and its Restricted Subsidiaries of
     Permitted Refinancing Indebtedness;

          (vii) the incurrence by the Company or any of its Restricted
     Subsidiaries of intercompany Indebtedness between or among the Company and
     its Restricted Subsidiaries; provided, however, that any subsequent
     issuance or transfer of Equity Interests that results in any such
     Indebtedness being held by a Person other than the Company or a Restricted
     Subsidiary of the Company, and any sale or other transfer of any such
     Indebtedness to a Person that is not the Company or a Restricted Subsidiary
     of the Company, shall be deemed, in each case, to constitute an incurrence
     of such Indebtedness by the Company or such Restricted Subsidiary, as the
     case may be;

          (viii) the incurrence by the Company or any of its Restricted
     Subsidiaries of Hedging Obligations incurred for the purpose of hedging
     against fluctuations in currency values or for the purpose of fixing or
     hedging interest rate risk with respect to any floating rate Indebtedness
     of the Company or any of its Restricted Subsidiaries permitted by this
     Indenture; provided that the notional principal amount of any Hedging
     Obligations does not significantly exceed the principal amount of
     Indebtedness to which such agreement relates;

          (ix) the Guarantee by the Company or any of its Restricted
     Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of
     the Company permitted by this Indenture;

          (x) the incurrence of Indebtedness arising from agreements providing
     for indemnification, adjustment of purchase price, earn out or other
     similar obligations, in each case incurred in connection with the
     acquisition or disposition of any business or assets or subsidiaries of the
     Company permitted by this Indenture;

          (xi) the Indebtedness incurred from time to time under a revolving
     credit facility of SSI Venture, LLC in an aggregate amount outstanding at
     any time not to exceed $10 million, so long as SSI Venture, LLC remains a
     Restricted Subsidiary of the Company; and

          (xii) the incurrence by the Company and its Restricted Subsidiaries of
     Indebtedness not covered by any other clause of this paragraph which is
     outstanding on the Closing Date and was incurred subsequent to May 11, 1999
     in compliance with the Existing Note Indenture.



                                      -53-


     For purposes of determining the amount of any Indebtedness of any Person
under this Section 4.09, (a) the principal amount of any Indebtedness of such
Person arising by reason of such Person having granted or assumed a Lien on its
property to secure Indebtedness of another Person shall be the lower of the fair
market value of such property and the principal amount of such Indebtedness
outstanding (or committed to be advanced) at the time of determination; (b) the
amount of any Indebtedness of such Person arising by reason of such Person
having Guaranteed Indebtedness of another Person where the amount of such
Guarantee is limited to an amount less than the principal amount of the
Indebtedness so Guaranteed shall be such amount as so limited; and (c)
Indebtedness shall not include a non-recourse pledge by the Company or any of
its Restricted Subsidiaries of Investments in any Person that is not a
Restricted Subsidiary of the Company to secure the Indebtedness of such Person.

     For purposes of determining compliance with this Section 4.09, in the event
that an item of Indebtedness meets the criteria of more than one of the
categories of Permitted Debt described in clauses (i) through (xi) above or is
entitled to be incurred pursuant to the first paragraph of this Section 4.09,
the Company, in its sole discretion, either (a) shall classify (and may later
reclassify) such item of Indebtedness in one of such categories in any manner
that complies with this Section 4.09 or (b) shall divide and classify (and may
later redivide and reclassify) such item of Indebtedness into more than one of
such categories pursuant to such first paragraph.

SECTION 4.10. Limitation on Restricted Payments

     The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, (i) declare or pay any dividend or make
any other payment or distribution on account of the Company's Equity Interests
(including, without limitation, any payment in connection with any merger or
consolidation involving the Company) or to any direct or indirect holders of the
Company's Equity Interests in their capacity as such (other than dividends or
distributions (a) payable in Equity Interests (other than Disqualified Stock) of
the Company, (b) payable in Capital Stock or assets of an Unrestricted
Subsidiary of the Company or (c) payable to the Company or any Restricted
Subsidiary of the Company); (ii) purchase, redeem or otherwise acquire or retire
for value (including, without limitation, in connection with any merger or
consolidation involving the Company) any Equity Interests of the Company, or any
Equity Interests of any of its Restricted Subsidiaries held by any Affiliate of
the Company (other than any such Equity Interests owned by the Company or any
Restricted Subsidiary of the Company, any Equity Interests then being issued by
the Company or a Restricted Subsidiary of the Company or any Investment in a
Person that, after giving effect to such Investment, is a Restricted Subsidiary
of the Company); (iii) make any payment on or with respect to, or purchase,
redeem, repay, defease or otherwise acquire or retire for value, any
Indebtedness of the Company or any Guarantor that is subordinated in right of
payment to the Notes or any Guarantee thereof, except a regularly scheduled
payment of interest or principal or sinking fund payment (other than the
purchase or other acquisition of such subordinated Indebtedness made in
anticipation of satisfying any sinking fund payment due within one year from the
date of acquisition); or (iv) make any Restricted Investment (all such payments
and other actions set forth in clauses (i) through (iv) above being collectively
referred to as "Restricted Payments"), unless, at the time of and after giving
effect to such Restricted Payment:



                                      -54-


          (a) no Default or Event of Default shall have occurred and be
     continuing or would occur as a consequence thereof;

          (b) the Company would, at the time of such Restricted Payment and
     after giving pro forma effect thereto as if such Restricted Payment had
     been made at the beginning of the applicable four-quarter period, have been
     permitted to incur at least $1.00 of additional Indebtedness pursuant to
     the Consolidated Interest Coverage Ratio test set forth in the first
     paragraph of Section 4.09 hereof; and

          (c) such Restricted Payment, together with the aggregate amount of all
     other Restricted Payments declared or made by the Company and its
     Restricted Subsidiaries after May 11, 1999 (without duplication and
     excluding Restricted Payments permitted by clauses (ii) and (iii) of the
     following paragraph), is less than the sum of (1) 50% of the Consolidated
     Net Income of the Company for the period (taken as one accounting period)
     from the beginning of the first fiscal quarter commencing after May 11,
     1999 to the end of the Company's most recently ended fiscal quarter for
     which internal financial statements are available at the time of such
     Restricted Payment (or, if such Consolidated Net Income for such period is
     a deficit, less 100% of such deficit); plus (2) 100% of the aggregate net
     cash proceeds and the fair market value of any assets or property (as
     determined in good faith by the Board of Directors of the Company) received
     by the Company from the issue or sale since May 11, 1999 of Equity
     Interests of the Company (other than Disqualified Stock), or of
     Disqualified Stock or debt securities of the Company that have been
     converted into such Equity Interests (other than Equity Interests or
     Disqualified Stock or convertible debt securities sold to a Subsidiary of
     the Company and other than Disqualified Stock or convertible debt
     securities that have been converted into Disqualified Stock); plus (3) with
     respect to Restricted Investments made after May 11, 1999, the net
     reduction of such Restricted Investments as a result of (x) any disposition
     of any such Restricted Investments sold or otherwise liquidated or repaid,
     to the extent of the net cash proceeds and the fair market value of any
     assets or property (as determined in good faith by the Board of Directors
     of the Company) received, (y) dividends, repayment of loans or advances or
     other transfers of assets to the Company or any Restricted Subsidiary of
     the Company or (z) the portion (proportionate to the Company's interest in
     the equity of a Person) of the fair market value of the net assets of an
     Unrestricted Subsidiary or other Person immediately prior to the time such
     Unrestricted Subsidiary or other Person is designated or becomes a
     Restricted Subsidiary of the Company (but only to the extent not included
     in subclause (1) of this clause (c)), provided that the sum of items (x),
     (y) and (z) of this subclause (3) shall not exceed, in the aggregate, the
     aggregate amount of such Restricted Investments made after May 11, 1999.

The foregoing provisions shall not prohibit (i) the payment of any dividend
within 60 days after the date of declaration thereof, if at said date of
declaration such payment would have complied with the provisions of this
Indenture, (ii) the redemption, repurchase, retirement, defeasance or other
acquisition of any subordinated Indebtedness or Equity Interests of the Company
in exchange for, or out of the net cash proceeds of the substantially concurrent
sale (other than to a Subsidiary of the Company) of, Equity Interests of the
Company (other than any Disqualified Stock, except to the extent that such
Disqualified Stock is issued in exchange for other



                                      -55-


Disqualified Stock or the net cash proceeds of such Disqualified Stock is used
to redeem, repurchase, retire or otherwise acquire other Disqualified Stock);
provided that the amount of any such net cash proceeds that are utilized for any
such redemption, repurchase, retirement, defeasance or other acquisition shall
be excluded from clause (c) (2) of the preceding paragraph; (iii) the
defeasance, redemption, repurchase or other acquisition of subordinated
Indebtedness in exchange for, or out of the net cash proceeds from an incurrence
of Permitted Refinancing Indebtedness; (iv) the repurchase, redemption or other
acquisition or retirement for value of any Equity Interests of the Company or
any Restricted Subsidiary of the Company held by any employees, officers or
directors of the Company or any of its Restricted Subsidiaries or, upon the
death, disability or termination of employment of such officers, directors and
employees, their authorized representatives in an aggregate amount not to exceed
in any twelve month period, $2.0 million plus the aggregate net cash proceeds
from any issuance during such period of Equity Interests by the Company to such
employees, officers, directors, or representatives plus the aggregate net cash
proceeds from any payments on life insurance policies in which the Company or
its Restricted Subsidiaries is the beneficiary with respect to such employees,
officers or directors the proceeds of which are used to repurchase, redeem or
acquire Equity Interests of the Company held by such employees, officers,
directors or representative; (v) the repurchase of Equity Interests of the
Company deemed to occur upon the exercise of stock options or similar
arrangement if such Equity Interests represents a portion of the exercise price
thereof; or (vi) additional Restricted Payments in an amount not to exceed $15
million (less the amount, if any, of any Restricted Payments made after May 11,
1999 and on or prior to the Closing Date that would not have been permitted
under any of the foregoing clauses); provided, however, that at the time of, and
after giving effect to, any Restricted Payment permitted under clauses (iv) or
(vi) no Default or Event of Default shall have occurred and be continuing.

     In the case of any Restricted Payments made other than in cash, the amount
thereof shall be the fair market value on the date of such Restricted Payment of
the asset(s) or securities proposed to be transferred or issued by the Company
or such Restricted Subsidiary, as the case may be, pursuant to the Restricted
Payment. The fair market value of any such asset(s) or securities shall be
determined in good faith by the Board of Directors of the Company. Where the
amount of any Investment made other than in cash is otherwise required to be
determined for purposes of this Indenture, then unless otherwise specified such
amount shall be the fair market value thereof on the date of such Investment,
and fair market value shall be determined in good faith by the Board of
Directors of the Company.

     The Board of Directors of the Company may designate any Restricted
Subsidiary to be an Unrestricted Subsidiary if such designation would not cause
a Default. For purposes of making such determination, all outstanding
Investments (including without limitation any direct or indirect obligation to
subscribe for additional Equity Interests or maintain or preserve such
subsidiary's financial condition or to cause such person to achieve any
specified level of operating results) by the Company and its Restricted
Subsidiaries (except to the extent repaid) in the Subsidiary so designated will
be deemed to be Investments at the time of such designation and, except to the
extent, if any, that such Investments are Permitted Investments at such time,
will reduce the amount otherwise available for Restricted Payments. All such
outstanding Investments will be deemed to constitute Investments in an amount
equal to the fair market value of such Investments at the time of such
designation. Such designation will only be permitted if such Investment would be
permitted at such time and if such Restricted Subsidiary otherwise



                                      -56-


meets (or would meet concurrently with the effectiveness of such designation)
the definition of an Unrestricted Subsidiary.

     Any such designation by the Board of Directors of the Company shall be
evidenced to the Trustee by filing with the Trustee a Board Resolution giving
effect to such designation. The Board of Directors of the Company may at any
time designate any Unrestricted Subsidiary to be a Restricted Subsidiary;
provided that such designation shall be deemed to be an incurrence of
Indebtedness by a Restricted Subsidiary of the Company of any outstanding
Indebtedness of such Unrestricted Subsidiary and such designation shall only be
permitted if (i) such Indebtedness is permitted by Section 4.09 hereof and (ii)
no Default or Event of Default would be in existence following such designation.

     To the extent that Unrestricted Subsidiaries were designated as such under
the Existing Note Indenture after the issuance of the Existing Notes on May 11,
1999 and on or prior to the date of this Indenture, and such designation
resulted in or constituted Restricted Payments and/or Permitted Investments
under the Existing Note Indenture, such designations shall be deemed to have
resulted in or constituted Restricted Payments and/or Permitted Investments
under this Indenture.

SECTION 4.11.  Limitation on Liens

     The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Lien securing Indebtedness on any asset now owned or hereafter
acquired, or any income or profits therefrom or assign or convey any right to
receive income therefrom, except Permitted Liens.

SECTION 4.12.  Limitation on Transactions with Affiliates

     The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (each of the foregoing, an "Affiliate Transaction"), unless
(i) such Affiliate Transaction is on terms that are no less favorable to Company
or the relevant Restricted Subsidiary than those that would have been obtained
in a comparable transaction by the Company or such Restricted Subsidiary with an
unrelated Person and (ii) the Company delivers to the Trustee (a) with respect
to any Affiliate Transaction or series of related Affiliate Transactions
involving aggregate payments or consideration in excess of $5.0 million, a Board
Resolution authorizing and determining the fairness of such Affiliate
Transaction approved by a majority of the independent members of the Board of
Directors of the Company and (b) with respect to any Affiliate Transaction or
series of related Affiliate Transactions involving aggregate payments or
consideration in excess of $15.0 million, an opinion as to the fairness to the
Company or such Restricted Subsidiary of such Affiliate Transaction from a
financial point of view issued by an accounting, appraisal or investment banking
firm of national standing.

     The foregoing provisions will not prohibit (i) reasonable fees and
compensation paid to and indemnity provided on behalf of officers, directors,
employees, agents or consultants of the



                                      -57-


Company or any Restricted Subsidiary of the Company as determined in good faith
by the Company's Board of Directors or senior management including, without
limitation, any issuance of Equity Interests of the Company pursuant to stock
option, stock ownership or similar plans; (ii) transactions between or among the
Company and/or its Restricted Subsidiaries; (iii) any agreement or arrangement
as in effect on May 11, 1999 and publicly disclosed or any amendment thereto or
any transaction contemplated thereby (including pursuant to any amendment
thereto) in any replacement agreement or arrangement thereto so long as any such
amendment or replacement agreement or arrangement is not more disadvantageous to
the Company or its Restricted Subsidiaries, as the case may be, in any material
respect than the original agreement as in effect on May 11, 1999; (iv) loans or
advances to employees and officers of the Company and its Restricted
Subsidiaries not in excess of $5 million at any time outstanding; and (v) any
Permitted Investment or any Restricted Payment that is permitted by Section 4.10
hereof.

SECTION 4.13. Limitation on Dividend and Other Payment Restrictions Affecting
              Subsidiaries

     The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any consensual encumbrance or restriction on the
ability of any Restricted Subsidiary to (i) (a) pay dividends or make any other
distributions to the Company or any of its Restricted Subsidiaries (1) on its
Capital Stock or (2) with respect to any other interest or participation in, or
measured by, its profits, or (b) pay any indebtedness or other obligations owed
to the Company or any of its Restricted Subsidiaries, (ii) make loans or
advances to the Company or any of its Restricted Subsidiaries, (iii) transfer
any of its properties or assets to the Company or any of its Restricted
Subsidiaries or (iv) guarantee the Notes or any renewals or refinancings
thereof, in each case except for such encumbrances or restrictions (other than
encumbrances and restrictions in respect of clause (iv) of this sentence)
existing under or by reason of (a) Existing Indebtedness as in effect on May 11,
1999, (b) the Credit Agreement (as defined in the Existing Note Indenture) as in
effect on May 11, 1999, and any amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacements or refinancings
thereof, provided that such amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacements or refinancings are no more
restrictive with respect to such dividend and other payment restrictions than
those contained in the Credit Agreement (as defined in the Existing Note
Indenture) as in effect on May 11, 1999, (c) (x) the Existing Notes, any
Guarantee thereof and the Existing Note Indenture and (y) the Notes, any
Guarantee thereof and this Indenture, (d) applicable law, (e) any instrument
governing Indebtedness or Equity Interests of a Person acquired by the Company
or any of its Restricted Subsidiaries as in effect at the time of such
acquisition (except to the extent such Indebtedness or Equity Interests were
incurred in connection with or in contemplation of such acquisition), which
encumbrance or restriction is not applicable to any Person, or the Equity
Interests, properties or assets of any Person, other than the Person, or the
Equity Interests, property or assets of the Person, so acquired, provided that,
in the case of Indebtedness, such Indebtedness was permitted by this Indenture,
(f) by reason of customary nonassignment provisions in leases entered into in
the ordinary course of business and consistent with past practices, (g) purchase
money obligations for property acquired in the ordinary course of business that
impose restrictions of the nature described in clause (iii) above on the
property so acquired or proceeds therefrom, (h) customary restrictions in asset
or stock sale agreements limiting transfer of such assets or stock pending the
closing of such sale, (i)



                                      -58-


customary non-assignment provisions in contracts entered into in the ordinary
course of business, or (j) Permitted Refinancing Indebtedness, provided that the
restrictions contained in the agreements governing such Permitted Refinancing
Indebtedness are no more restrictive than those contained in the agreements
governing the Indebtedness being refinanced.

SECTION 4.14.  Limitation on Layering Debt

     (a) The Company shall not, directly or indirectly, incur, create, issue,
assume, guarantee or otherwise become liable for any Indebtedness that is by its
terms subordinate or junior in right of payment to any Senior Debt of the
Company and senior in any respect in right of payment to the Notes.

     (b) The Company shall not permit any Guarantor to, directly or indirectly,
incur, create, issue, assume, guarantee or otherwise become liable for any
Indebtedness that is by its terms subordinate or junior in right of payment to
any Senior Debt of such Guarantor and senior in any respect in right of payment
to the Subsidiary Guarantee of such Guarantor.

SECTION 4.15.  Payments for Consent

     The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, pay or cause to be paid any consideration, whether by
way of interest, fee or otherwise, to any Holder of any Notes for or as an
inducement to any consent, waiver or amendment of any of the terms or provisions
of this Indenture or the Notes unless such consideration is offered to be paid
and is paid to all Holders of Notes that consent, waive or agree to amend in the
time frame set forth in the solicitation documents relating to such consent,
waiver or agreement.

SECTION 4.16. Asset Sales

     The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, consummate an Asset Sale unless (i) the
Company (or such Restricted Subsidiary, as the case may be) receives
consideration at the time of such Asset Sale at least equal to the fair market
value (evidenced by a Board Resolution ) of the assets or Equity Interests
issued or sold or otherwise disposed of and (ii) at least 75% of the
consideration therefor received by the Company or such Restricted Subsidiary is
in the form of (x) cash or Cash Equivalents or (y) a controlling interest in
another business or fixed or other long-term assets, in each case, in a Similar
Business; provided that the amount of (a) any liabilities (as shown on the
Company's or such Restricted Subsidiary's most recent balance sheet) of the
Company or such Restricted Subsidiary (other than contingent liabilities and
liabilities that are by their terms subordinated to the Notes or any Guarantee
thereof) that are assumed by the transferee of any such assets or Equity
Interests such that the Company or such Restricted Subsidiary are released from
further liability and (b) any securities, notes or other obligations received by
the Company or such Restricted Subsidiary from such transferee that are
converted by the Company or such Restricted Subsidiary into cash within 90 days
or are guaranteed (by means of a letter of credit or otherwise) by an
institution specified in the definition of "Cash Equivalents" (to the extent of
the cash received or the obligations so guaranteed) shall be deemed to be cash
or Cash Equivalents for purposes of this Section 4.16, subject to application as
provided in the following paragraph.



                                      -59-


     Within 365 days after the receipt of any Net Proceeds from an Asset Sale,
the Company, at its option, may (i) apply such Net Proceeds to permanently
prepay, repay or reduce any Senior Debt of the Company (and to correspondingly
reduce commitments with respect thereto in the case of revolving borrowings) or
(ii) apply such Net Proceeds to the acquisition of a controlling interest in
another business, the making of a capital expenditure or the acquisition of
other long-term assets, in each case, in a Similar Business, or determine to
retain such Net Proceeds to the extent such Net Proceeds constitute such a
controlling interest or long-term asset in a Similar Business. Pending the final
application of any such Net Proceeds, the Company may invest such Net Proceeds
in any manner that is not prohibited by this Indenture. Any Net Proceeds from
Asset Sales that are not applied or invested as provided in the first sentence
of this paragraph will be deemed to constitute "Excess Proceeds." When the
aggregate amount of Excess Proceeds exceeds $10 million, the Company shall make
an offer to all Holders of Notes (and holders of other Indebtedness of the
Company, including the Existing Notes, to the extent required by the terms of
such other Indebtedness) (an "Asset Sale Offer") to purchase the maximum
principal amount of Notes (and such other Indebtedness) that does not exceed the
Excess Proceeds at an offer price in cash in an amount equal to 100% of the
principal amount thereof, plus accrued and unpaid interest and Liquidated
Damages, if any, thereon to the date of purchase, in accordance Section 3.10
hereof. To the extent that the aggregate principal amount of Notes (and such
other Indebtedness) tendered pursuant to an Asset Sale Offer is less than the
Excess Proceeds, the Company may use any remaining Excess Proceeds for general
corporate purposes. If the aggregate principal amount of Notes (and such other
Indebtedness) tendered exceeds the amount of Excess Proceeds, the Notes (and
such other Indebtedness) to be purchased shall be selected on a pro rata basis.
Upon completion of an Asset Sale Offer, the amount of Excess Proceeds shall be
reset at zero. The Asset Sale Offer must be commenced within 60 days following
the date on which the aggregate amount of Excess Proceeds exceeds $10 million.

     The Company shall comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of Notes pursuant to an Asset Sale Offer.

SECTION 4.17.  Offer to Repurchase Upon Change of Control

     (a) Upon the occurrence of a Change of Control, unless notice of redemption
of the Notes in whole has been given pursuant to Sections 3.04 and 3.08 hereof,
the Company shall make an offer to purchase all or any part (equal to $1,000 or
an integral multiple thereof) of each Holder's Notes pursuant to the offer
described below (the "Change of Control Offer") at an offer price in cash (the
"Change of Control Payment") equal to 101% of the aggregate principal amount
thereof, plus accrued and unpaid interest and Liquidated Damages, if any,
thereon to the date of purchase (the "Change of Control Payment Date").

     (b) Notice of a Change of Control Offer shall be mailed by the Company,
with a copy to the Trustee, or, at the option of the Company and at the expense
of the Company, by the Trustee within 30 days following a Change of Control to
each Holder of Notes, with the following statements and/or information:



                                      -60-


     (1)  a Change of Control Offer is being made pursuant to this Section 4.17
          and that all Notes properly tendered pursuant to such Change of
          Control Offer will be accepted for payment;

     (2)  the purchase price, the expiration date of the Change of Control Offer
          (the "Expiration Date"), which shall be no earlier than 30 days nor
          later than 60 days from the date such notice is mailed (except as may
          be otherwise required by applicable law) and the Change of Control
          Payment Date, which shall be no later than the third Business Day
          following the Expiration Date;

     (3)  any Note not properly tendered will remain outstanding and continue to
          accrue interest and Liquidated Damages, if any;

     (4)  unless the Company defaults in the payment of the Change of Control
          Payment, all Notes accepted for payment pursuant to the Change of
          Control Offer will cease to accrue interest and Liquidated Damages, if
          any, on the Change of Control Payment Date;

     (5)  Holders electing to have a Note purchased pursuant to any Change of
          Control Offer shall be required to surrender the Note, with the form
          entitled "Option of Holder to Elect Purchase" on the reverse of the
          Note completed, or transfer by book-entry transfer, to the Company, a
          depositary, if appointed by the Company, or a Paying Agent and at the
          address specified in the notice prior to the expiration of the Change
          of Control Offer;

     (6)  Holders shall be entitled to withdraw their tendered Notes and their
          election to require the Company to purchase such Notes, provided that
          the Company, the depositary or Paying Agent, as the case may be,
          receives, not later than the close of business on the Expiration Date,
          a telegram, telex, facsimile transmission or letter setting forth the
          name of the Holder, the principal amount of the Notes tendered for
          purchase, and a statement that such Holder is withdrawing his tendered
          Notes and his election to have such Notes purchased;

     (7)  that Holders whose Notes are being purchased only in part shall be
          issued new Notes equal in principal amount to the unpurchased portion
          of the Notes surrendered (or transferred by book-entry transfer),
          which unpurchased portion must be equal to $1,000 in principal amount
          or an integral multiple thereof; and

     (8)  a description of the transaction or transactions that constitute the
          Change of Control.

     (c) The Company shall comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws



                                      -61-


and regulations are applicable in connection with the repurchase of Notes
pursuant to a Change of Control Offer.

     (d) On the Change of Control Payment Date, the Company shall, to the extent
lawful, (1) accept for payment all Notes or portions thereof properly tendered
pursuant to the Change of Control Offer, (2) deposit with the Paying Agent an
amount equal to the aggregate Change of Control Payment in respect of all Notes
or portions thereof so tendered and (3) deliver, or cause to be delivered, to
the Trustee for cancellation the Notes so accepted together with an Officers'
Certificate stating the aggregate principal amount of Notes or portions thereof
being purchased by the Company. The Paying Agent shall promptly mail or deliver
to each Holder of Notes so tendered the Change of Control Payment for such
Notes, and the Trustee shall promptly authenticate and mail (or cause to be
transferred by book entry) to each Holder a new Note equal in principal amount
to any unpurchased portion of the Notes surrendered, if any; provided that each
such new Note will be in a principal amount of $1,000 or an integral multiple
thereof. The Company will publicly announce the results of the Change of Control
Offer on or as soon as practicable after the Change of Control Payment Date.

     (e) Notwithstanding the foregoing, if the Change of Control Payment Date is
on or after a Regular Record Date and on or before the related Interest Payment
Date, any accrued and unpaid interest and Liquidated Damages, if any, shall be
paid to the Person in whose name a Note is registered at the close of business
on such Regular Record Date, and no additional interest shall be payable to
Holders who tender Notes pursuant to the Change of Control Offer.

     (f) Notwithstanding the foregoing, the Company shall not be required to
make a Change of Control Offer upon a Change of Control if a third party makes
the Change of Control Offer in the manner, at the times and otherwise in
compliance with the requirements set forth in this Indenture applicable to a
Change of Control Offer made by the Company and purchases all Notes validly
tendered and not withdrawn under such Change of Control Offer.

     (g) The Change of Control provisions described in this Section 4.17 will be
applicable whether or not any other provisions of this Indenture are applicable.

SECTION 4.18. Additional Subsidiary Guarantees

     If any Restricted Subsidiary of the Company after the date of this
Indenture shall become or be required to become a guarantor under the Credit
Agreement, or shall become a guarantor of any other Indebtedness of the Company
or any Restricted Subsidiary, then the Company shall cause such Restricted
Subsidiary to (i) become (by a supplemental indenture executed and delivered to
the Trustee in form satisfactory to the Trustee) a Guarantor and (ii) deliver to
the Trustee an Opinion of Counsel reasonably satisfactory to the Trustee that
such supplemental indenture has been duly executed and delivered; provided, that
if such Restricted Subsidiary is released and discharged from all obligations
under such guarantees, it shall be released and discharged from its obligations
under its Subsidiary Guarantee as provided in Section 12.06 hereof. For the
purposes of this Indenture, a Subsidiary shall, without limitation, be deemed to
have guaranteed Indebtedness of another Person if such Subsidiary has
Indebtedness of the kind described in clause (ii) or clause (iii) of the
definition of the term "Indebtedness."



                                      -62-


                                   ARTICLE 5

                                   SUCCESSORS

SECTION 5.01.  Limitation on Merger, Consolidation or Sale of Assets

     (a) The Company shall not consolidate or merge with or into (whether or not
the Company is the surviving Person), or sell, assign, transfer, lease, convey
or otherwise dispose of all or substantially all of its properties or assets in
one or more related transactions to, another Person unless (i) the Company is
the surviving Person or the Person formed by or surviving any such consolidation
or merger (if other than the Company) or to which such sale, assignment,
transfer, lease, conveyance or other disposition shall have been made is a
Person organized or existing under the laws of the United States, any state
thereof or the District of Columbia; (ii) the Person formed by or surviving any
such consolidation or merger (if other than the Company) or the Person to which
such sale, assignment, transfer, lease, conveyance or other disposition shall
have been made assumes all the obligations of the Company under the Notes and
this Indenture pursuant to a supplemental indenture in a form reasonably
satisfactory to the Trustee; (iii) immediately after giving effect to such
transaction no Default or Event of Default exists; and (iv) except in the case
of a merger of the Company with or into a Restricted Subsidiary of the Company,
the Company or the Person formed by or surviving any such consolidation or
merger (if other than the Company), or to which such sale, assignment, transfer,
lease, conveyance or other disposition shall have been made, (A) shall have
Consolidated Net Worth immediately after the transaction equal to or greater
than the Consolidated Net Worth of the Company immediately preceding the
transaction and (B) shall, at the time of such transaction and after giving pro
forma effect thereto as if such transaction had occurred at the beginning of the
applicable four-quarter period, be permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Consolidated Interest Coverage Ratio
test set forth in the first paragraph of Section 4.09 hereof.

     Nothing contained in the foregoing paragraph shall prohibit (i) any
Restricted Subsidiary from consolidating with, merging with or into, or
transferring all or part of its properties and assets to the Company or (ii) the
Company from merging with an Affiliate for the purpose of reincorporating the
Company in another jurisdiction to realize tax or other benefits; provided,
however, that in connection with any such merger, consolidation or asset
transfer no consideration, other than common stock (that is not Disqualified
Stock) in the surviving Person or the Company shall be issued or distributed.

     (b) The Company shall deliver to the Trustee prior to the consummation of
any proposed transaction subject to the foregoing clause (a) an Officers'
Certificate and an Opinion of Counsel, each stating that the proposed
transaction and such supplemental indenture comply with this Indenture. The
Trustee shall be entitled to conclusively rely upon such Officers' Certificate
and Opinion of Counsel.

SECTION 5.02.  Successor Person Substituted

     Upon any consolidation or merger, or any sale, assignment, transfer, lease,
conveyance or other disposition of all or substantially all of the assets of the
Company in accordance with



                                      -63-


Section 5.01 hereof, the successor Person formed by such consolidation or into
or with which the Company is merged or to which such sale, assignment, transfer,
lease, conveyance or other disposition is made shall succeed to, and be
substituted for (so that from and after the date of such consolidation, merger,
sale, lease, conveyance or other disposition, the provisions of this Indenture
referring to the "Company" shall refer instead to the successor Person and not
to the Company), and may exercise every right and power of the Company under
this Indenture with the same effect as if such successor Person had been named
as the Company herein.

                                   ARTICLE 6

                             DEFAULTS AND REMEDIES

SECTION 6.01.  Events of Default

     Each of the following constitutes an Event of Default:

          (1) default for 30 days or more in the payment when due of interest
     on, or Liquidated Damages, if any, with respect to, the Notes (whether or
     not prohibited by Article 10 hereof); or

          (2) default in payment when due (whether payable at maturity, upon
     redemption or repurchase or otherwise) of the principal of or premium, if
     any, on the Notes (whether or not prohibited by Article 10 hereof); or

          (3) failure by the Company or any of its Restricted Subsidiaries to
     comply with Article 5 hereof; or

          (4) failure by the Company to comply with Sections 3.10, 4.16 or 4.17
     hereof (whether or not prohibited by Article 10 hereof) (other than a
     failure to purchase Notes pursuant to an offer commenced under such
     provisions, which shall be subject to clause (2) above) for 30 days after
     written notice by the Trustee or the Holders of at least 25% in principal
     amount of the then outstanding Notes; or

          (5) failure by the Company or any of its Restricted Subsidiaries for
     60 days after written notice by the Trustee or the Holders of at least 25%
     in principal amount of the then outstanding Notes to comply with any of its
     other agreements in this Indenture or the Notes other than those referred
     to in clauses (1), (2), (3) or (4) above; or

          (6) default under any mortgage, indenture or instrument under which
     there may be issued or by which there may be secured or evidenced any
     Indebtedness for money borrowed by the Company or any of its Significant
     Subsidiaries (or the payment of which is guaranteed by the Company or any
     of its Significant Subsidiaries), whether such Indebtedness or guarantee
     now exists, or is created after the Closing Date, which default (a) is
     caused by a failure to pay principal after final maturity of such
     Indebtedness prior to the expiration of the grace period provided in such
     Indebtedness on the date of such default (a "Payment Default") or (b)
     results in the acceleration of such Indebtedness prior to its express
     maturity and, in each case, the principal amount of any such Indebtedness,
     together with the principal amount of any other such Indebtedness under


                                      -64-


     which there has been a Payment Default or the maturity of which has been so
     accelerated, aggregates $10 million or more without such Indebtedness being
     discharged or such acceleration having been cured, waived or rescinded
     within 30 days of acceleration; or

          (7) failure by the Company or any of its Significant Subsidiaries to
     pay final judgments aggregating in excess of $10.0 million and either (a)
     any creditor commences enforcement proceedings upon any such judgment or
     (b) such judgments are not paid, discharged or stayed for a period of 60
     days; or

          (8) except as permitted by this Indenture, any Guarantee of the Notes
     by a Significant Subsidiary shall be held in any judicial proceeding to be
     unenforceable or invalid or shall cease for any other reason to be in full
     force and effect, or any Guarantor which is a Significant Subsidiary, or
     any Person acting on behalf of any such Guarantor, shall deny or disaffirm
     its obligations under its Subsidiary Guarantee; or

          (9) the Company or any Restricted Subsidiary that is a Significant
     Subsidiary, pursuant to or within the meaning of any Bankruptcy Law:

               (A) commences a voluntary case or proceeding,

               (B) consents to the entry of an order for relief against it in an
          involuntary case or proceeding,

               (C) consents to the appointment of a Custodian of it or for all
          or substantially all of its property,

               (D) makes a general assignment for the benefit of its creditors,
          or

               (E) admits in writing its inability generally to pay its debts as
          the same become due; or

          (10) a court of competent jurisdiction enters an order or decree under
     any Bankruptcy Law that:

               (A) is for relief against the Company or any Restricted
          Subsidiary that is a Significant Subsidiary in an involuntary case or
          proceeding,

               (B) appoints a Custodian of the Company or any Restricted
          Subsidiary that is a Significant Subsidiary or for all or a
          substantial part of the property of the Company or any Restricted
          Subsidiary that is a Significant Subsidiary, or

               (C) orders the liquidation of the Company or any Restricted
          Subsidiary that is a Significant Subsidiary,

     and the order or decree contemplated by clause (A), (B) or (C) of this
     clause (10) remains unstayed and in effect for 60 consecutive days.



                                      -65-


SECTION 6.02.  Acceleration of Maturity

     If any Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the then outstanding Notes may
declare all the Notes and all other Obligations thereunder to be due and payable
immediately by notice in writing to the Company and the Trustee. Upon a
declaration of acceleration, the Notes and all other Obligations thereunder
shall become immediately due and payable.

     Notwithstanding the foregoing, in the case of an Event of Default specified
in clause (9) or (10) of Section 6.01 hereof occurring with respect to the
Company, all outstanding Notes and all other Obligations thereunder shall become
immediately due and payable without further action or notice.

     If any Event of Default occurs by reason of any willful action (or
inaction) taken (or not taken) by or on behalf of the Company or any Guarantor
with the intention of avoiding payment of the premium that the Company would
have had to pay if the Company then had elected to redeem the Notes pursuant to
Section 3.08 hereof, an equivalent premium shall also become and be immediately
due and payable to the extent permitted by law upon the acceleration of the
Notes.

SECTION 6.03.  Other Remedies

     If an Event of Default occurs and is continuing, the Trustee may pursue any
available remedy (under this Indenture or otherwise) to collect the payment of
principal of, premium, if any, Liquidated Damages, if any, and interest on the
Notes or to enforce the performance of any provision of the Notes, this
Indenture or the Registration Rights Agreement.

     The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding. A delay or omission
by the Trustee or any Holder of a Note in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.

SECTION 6.04.  Waiver of Past Defaults

     Subject to Section 6.07 hereof, the Holders of a majority in aggregate
principal amount of the then outstanding Notes by notice to the Trustee may on
behalf of the Holders of all of the Notes waive an existing Default or Event of
Default and its consequences hereunder, except a continuing Default or Event of
Default in the payment of the principal of, premium, if any, interest or
Liquidated Damages, if any, on, any Note held by a non-consenting Holder;
provided, however, that the Holders of at least a majority in aggregate
principal amount of the Notes then outstanding may rescind an acceleration and
its consequences, including any related payment default that resulted from such
acceleration. Upon any such waiver, such Default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or impair any right consequent thereon.



                                      -66-


SECTION 6.05.  Control by Majority

     The Holders of a majority in aggregate principal amount of the then
outstanding Notes may direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee or exercising any
trust or power conferred on it. However, subject to Section 7.01 hereof, the
Trustee may refuse to follow any direction that conflicts with law or this
Indenture that the Trustee determines may be unduly prejudicial to the rights of
other Holders of Notes or that may involve the Trustee in personal liability.
The Trustee may take any other action which it deems proper and which is not
inconsistent with any such direction. In the event the Trustee takes any action
or follows any direction pursuant to this Indenture, the Trustee shall be
entitled to indemnification reasonably satisfactory to it against any loss or
expense caused by taking such action or following such direction.

SECTION 6.06.  Limitation on Suits

     No Holder of a Note will have any right to institute any proceeding with
respect to this Indenture or for any remedy hereunder, unless (i) such Holder
shall have previously given to the Trustee written notice of a continuing Event
of Default with respect to the Notes, (ii) the Holders of at least 25% in
aggregate principal amount of the Notes then outstanding shall have made written
request to the Trustee to institute such proceeding and, if requested by the
Trustee, provided indemnity satisfactory to the Trustee, with respect to such
proceeding, (iii) the Trustee shall not have received from the Holders of a
majority in aggregate principal amount of the Notes then outstanding a direction
inconsistent with such request and (iv) the Trustee shall have failed to
institute such proceeding within 30 days after such request and, if requested,
the provision of an indemnity satisfactory to the Trustee.

     Notwithstanding anything to the contrary contained in this Section 6.06,
any Holder of a Note shall have the right to institute a proceeding with respect
to this Indenture or the Notes or for any remedy in the following instances:

          (i) a Holder of a Note may institute suit for enforcement of payment
     of principal of and premium, if any, or interest or Liquidated Damages, if
     any, on such Note on or after the respective due dates expressed in such
     Note (including upon acceleration thereof) or

          (ii) Holders of a majority in principal amount of the outstanding
     Notes may institute any proceeding with respect to this Indenture or the
     Notes or any remedy thereunder; provided that, upon institution of any
     proceeding or exercise of any remedy, such Holders provide the Trustee with
     prompt written notice thereof.

     A Holder of Notes may not use this Indenture to prejudice the rights of
another Holder of Notes or to obtain a preference or priority over another
Holder of Notes.

SECTION 6.07.  Rights of Holders to Receive Payment

     Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of principal of, premium, if any, interest
or Liquidated Damages, if any, on any Note, on or after the respective due dates
expressed in such Note, any Redemption Date, any



                                      -67-


Change of Control Payment Date or any Purchase Date, or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.

SECTION 6.08.  Collection Suit by Trustee

     If an Event of Default specified in Section 6.01(1) or (2) hereof occurs
and is continuing, the Trustee is authorized to recover judgment in its own name
and as trustee of an express trust against the Company or any Guarantor for the
whole amount of principal of, premium, if any, interest and Liquidated Damages,
if any, owing on the Notes and such further amount as shall be sufficient to
cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due to the Trustee under Section 7.07 hereof.

SECTION 6.09.  Trustee May File Proofs of Claim

     The Trustee is authorized to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of Notes allowed in any judicial proceedings relative to the Company (or
any Guarantor or other obligor upon the Notes), its creditors or its property
and shall be entitled and empowered to collect, receive and distribute any money
or other property payable or deliverable upon the conversion or exchange of the
Notes or upon any such claims and any custodian in any such judicial proceeding
is hereby authorized by each Holder of Notes to make such payments to the
Trustee and, in the event that the Trustee shall expressly consent to the making
of such payments directly to the Holders of Notes, to pay to the Trustee any
amount due to it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.07 hereof. To the extent that the payment of any such
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof out
of the estate in any such proceeding, shall be denied for any reason, payment of
the same shall be secured by a Lien on, and shall be paid out of, any and all
distributions, dividends, money, securities and other properties that the
Holders of Notes may be entitled to receive in such proceeding whether in
liquidation or under any plan of reorganization or arrangement or otherwise.
Nothing herein contained shall be deemed to authorize the Trustee to authorize
or consent to or accept or adopt on behalf of any Holder of Notes any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Holder of Notes in any such proceeding.

SECTION 6.10.  Priorities

     If the Trustee collects any money pursuant to this Article 6, it shall,
subject to Article 10 and Section 12.04 hereof, pay out the money in the
following order:



                                      -68-


          First: to the Trustee, its agents and attorneys for amounts due under
     Section 7.07 hereof, including payment of all compensation, expense and
     liabilities incurred, and all advances made, by the Trustee and the costs
     and expenses of collection;

          Second: to Holders of Notes for amounts due and unpaid on the Notes
     for principal, premium, if any, interest and Liquidated Damages, if any,
     ratably, without preference or priority of any kind, according to the
     amounts due and payable on the Notes for principal, premium, if any,
     interest and Liquidated Damages, if any, respectively;

          Third: without duplication, to the Holders for any other Obligations
     owing to the Holders under this Indenture, the Registration Rights
     Agreement and the Notes; and

          Fourth: to the Company or to such party as a court of competent
     jurisdiction shall direct.

     The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10.

SECTION 6.11.  Undertaking for Costs

     In any suit for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or omitted by it as a
Trustee, a court in its discretion may require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section 6.11
does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section
6.07 hereof, or a suit by a Holder or Holders of more than 10% in principal
amount of the then outstanding Notes.

                                   ARTICLE 7

                                    TRUSTEE

SECTION 7.01.  Duties of Trustee

     (1) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in their exercise, as a prudent person
would exercise or use under the circumstances in the conduct of its own affairs.

     (2) Except during the continuance of an Event of Default:

          (A) the duties of the Trustee shall be determined solely by the TIA or
     the express provisions of this Indenture and the Trustee need perform, and
     be liable for (as set forth herein), only those duties that are
     specifically set forth in the TIA or this Indenture and no others, and no
     implied covenants or obligations shall be read into this Indenture against
     the Trustee; and



                                      -69-


          (B) in the absence of bad faith on its part, the Trustee may
     conclusively rely, as to the truth of the statements and the correctness of
     the opinions expressed therein, upon certificates or opinions furnished to
     the Trustee and conforming to the requirements of this Indenture, provided
     that the Trustee shall examine the certificates and opinions to determine
     whether or not they conform to the requirements of this Indenture.

     (3) The Trustee may not be relieved from liabilities for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:

          (A) this paragraph does not limit the effect of clause (2) of this
     Section 7.01.

          (B) the Trustee shall not be liable for any error of judgment made in
     good faith by a Responsible Officer, unless it is proved that the Trustee
     was negligent in ascertaining the pertinent facts; and

          (C) the Trustee shall not be liable with respect to any action it
     takes or omits to take in good faith in accordance with a direction
     received by it pursuant to Section 6.05 hereof.

     (4) Whether or not therein expressly so provided, every provision of this
Indenture that in any way relates to the Trustee is subject to clauses (1), (2)
and (3) of this Section 7.01.

     (5) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture unless
the Holders shall have offered to the Trustee security and indemnity
satisfactory to it against any loss, liability or expense.

     (6) The Trustee shall not be liable for interest on any money or other
assets received by it except as the Trustee may agree in writing with the
Company. Money or other assets held in trust by the Trustee need not be
segregated from other funds except to the extent required by law.

     (7) The Trustee shall not be bound to make any investigation into the facts
or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture or
other paper or documents, but the Trustee, in its discretion may make such
further inquiry or investigation into such facts or matters as it may see fit,
and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Company or any Subsidiary of the Company, personally or by agent or
attorney.

SECTION 7.02.  Rights of Trustee

     (1) The Trustee may conclusively rely and shall be fully protected in
relying upon any resolution, document, Officers' Certificate or any other
certificate, statement, instrument, opinion, report, notice, request, consent,
order, bond or other document believed by it to be genuine and to have been
signed or presented by the proper Person. The Trustee need not investigate any
fact or matter stated in the document.



                                      -70-


     (2) Before the Trustee acts or refrains from acting, it may consult with
counsel and it may require an Officers' Certificate or an Opinion of Counsel or
both which shall comply with Sections 1.05 and 13.04 hereof. The Trustee shall
not be liable for any action it takes or omits to take in good faith in reliance
on such Officers' Certificate or Opinion of Counsel. The Trustee may consult
with counsel and the advice of such counsel or any Opinion of Counsel shall be
full and complete authorization and protection from liability, in respect of any
action taken, suffered or omitted by it hereunder in good faith and in reliance
thereon.

     (3) The Trustee may act through its attorneys, agents, custodians and
nominees and shall not be responsible for the misconduct or negligence of any
agent, custodian and nominee appointed with due care.

     (4) The Trustee shall not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.

     (5) Unless otherwise specifically provided in this Indenture, any demand,
request, direction or notice from the Company or any Guarantor shall be
sufficient if signed by an Officer of the Company or such Guarantor. A
permissive right granted to the Trustee hereunder shall not be deemed an
obligation to act.

     (6) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request, order or direction of
any of the Holders pursuant to the provisions of this Indenture including,
without limitation, the provisions of Section 6.05 hereof, unless such Holders
shall have offered to the Trustee security or indemnity satisfactory to the
Trustee against the costs, expenses and liabilities that might be incurred by it
in compliance with such request, order or direction.

     (7) The Trustee shall not be charged with knowledge of any Default or Event
of Default unless either (i) a Responsible Officer of the Trustee shall have
actual knowledge of such Default or Event of Default or (ii) written notice of
such Default or Event of Default shall have been given to the Trustee by the
Company or any Holder.

     (8) In no event shall the Trustee be liable for the selection of
investments or for investment losses incurred thereon. The Trustee shall have no
liability in respect of losses incurred as a result of the liquidation of any
such investment prior to its stated maturity or the failure of the party
directing such investment to provide timely written investment direction;
provided in each such case that the Trustee shall have acted strictly in
accordance with written directions received from the instructing party. The
Trustee shall have no obligation to invest or reinvest any amounts held
hereunder in the absence of such written investment direction.

     (9) In the event that the Trustee is also acting as Paying Agent, transfer
agent, or Registrar hereunder, the rights and protections afforded to the
Trustee pursuant to this Article 7 shall also be afforded to such Paying Agent,
transfer agent, or Registrar.



                                      -71-


SECTION 7.03.  Individual Rights of Trustee

     The Trustee, in its individual or any other capacity, may become the owner
or pledgee of Notes and may otherwise deal with the Company or any Affiliate of
the Company with the same rights it would have if it were not Trustee. However,
in the event that the Trustee acquires any conflicting interest it must
eliminate such conflict within 90 days, apply to the SEC for permission to
continue as trustee or resign. Any Agent may do the same with like rights and
duties. However, the Trustee is also subject to Sections 7.10 and 7.11 hereof.

SECTION 7.04.  Trustee's Disclaimer

     The Trustee shall not be responsible for and makes no representation as to
the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the direction of the Company under any provision of
this Indenture, it shall not be responsible for the use or application of any
money received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.

SECTION 7.05.  Notice of Defaults

     If a Default or Event of Default occurs and is continuing and if it is
known to a Responsible Officer of the Trustee, the Trustee shall mail to Holders
of Notes a notice of the Default or Event of Default within 90 days after it
occurs. Except in the case of a Default or Event of Default in payment of
principal of, premium, if any, interest or Liquidated Damages, if any, on any
Note pursuant to Section 6.01(1) or (2) hereof, the Trustee may withhold the
notice if it in good faith determines that withholding the notice is in the
interests of Holders of Notes.

SECTION 7.06.  Reports by Trustee to Holders of Notes

     Within 60 days after each May 15 beginning with May 15, 2002, and for so
long as Notes remain outstanding, the Trustee shall mail to the Holders of Notes
a brief report dated as of such reporting date that complies with TIA ss. 313(a)
(but if no event described in TIA ss. 313(a) has occurred within the twelve
months preceding the reporting date, no report need be transmitted). The Trustee
also shall comply with TIA ss. 313(b)(2). The Trustee shall also transmit by
mail all reports as required by TIA ss. 313(c).

     A copy of each report at the time of its mailing to the Holders of Notes
shall be mailed to the Company and filed with the SEC and each stock exchange on
which the Notes are listed in accordance with TIA ss. 313(d). The Company shall
promptly notify the Trustee when the Notes are listed on any securities exchange
or of any delisting thereof.

SECTION 7.07.  Compensation and Indemnity

     The Company and each of the Guarantors, jointly and severally, shall pay to
the Trustee, from time to time, as may be agreed upon between them, reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation shall not be



                                      -72-


limited by any law on compensation of a trustee of an express trust. The Company
and each of the Guarantors, jointly and severally, shall reimburse the Trustee
promptly upon request for all reasonable disbursements, advances and expenses
incurred or made by it in addition to the compensation for its services in
accordance with any provision of this Indenture (including, without limitation,
the reasonable compensation, expenses and disbursements of its counsel and of
all agents and other persons not regularly in its employ (A) in connection with
the preparation, execution and delivery of this Indenture, any waiver or consent
hereunder, any modification or termination hereof, or any Event of Default or
alleged Event of Default; (B) if an Event of Default occurs, in connection with
such Event of Default and collection, bankruptcy, insolvency and other
enforcement proceedings relating thereto; (C) in connection with the
administration of the Trustee's rights pursuant hereto; or (D) in connection
with any removal of the Trustee pursuant to Section 7.08 hereof), except such
disbursements, advances and expenses as may be attributable to its negligence or
bad faith.

     The Company and each of the Guarantors, jointly and severally, shall
indemnify the Trustee and its officers, directors, employees and agents against
any and all losses, liabilities, obligations, damages, penalties, judgments,
actions, suits, proceedings, reasonable costs and expenses (including reasonable
fees and disbursements of counsel) of any kind whatsoever which may be incurred
by the Trustee in connection with any investigative, administrative or judicial
proceeding (whether or not such indemnified party is designated a party to such
proceeding) arising out of or in connection with the acceptance or
administration of its duties under this Indenture, including the costs and
expenses of enforcing this Indenture against the Company or the Guarantors
(including this Section 7.07) and defending itself against any claim (whether
asserted by the Company or any Holder or any other Person) or liability in
connection with the exercise or performance of any of its duties or powers
hereunder; provided, however, that the Company need not reimburse any expense or
indemnify against any loss, obligation, damage, penalty, judgment, action, suit,
proceeding, reasonable cost or expense (including reasonable fees and
disbursements of counsel) of any kind whatsoever which may be incurred by the
Trustee in connection with any investigative, administrative or judicial
proceeding (whether or not such indemnified party is designated a party to such
proceeding) in which it is determined that the Trustee acted with gross
negligence or bad faith. The Trustee shall notify the Company promptly of any
claim for which it may seek indemnity. Failure by the Trustee to so notify the
Company shall not relieve the Company or the Guarantors of any of their
obligations hereunder. The Company and the Guarantors shall defend the claim and
the Trustee shall cooperate in the defense. The Trustee may have separate
counsel and the Company and each of the Guarantors, jointly and severally, shall
pay the reasonable fees and expenses of such counsel. The Company and the
Guarantors need not pay for any settlement made without its consent, which
consent shall not be unreasonably withheld.

     The obligations of the Company and the Guarantors under this Section 7.07
(including the reasonable fees and expenses of its agents and counsel) shall
survive the resignation or removal of the Trustee and the satisfaction and
discharge of this Indenture and any rejection or termination under any
Bankruptcy Law.

     To secure the Company's payment obligations in this Section 7.07, the
Trustee shall have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that



                                      -73-


held in trust to pay principal, premium, if any, and interest and Liquidated
Damages, if any, on particular Notes. Such Lien shall survive the satisfaction
and discharge of this Indenture.

     When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(9) or (10) hereof occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.

     The Trustee shall comply with the provisions of TIA ss. 313(b)(2) to the
extent applicable.

SECTION 7.08.  Replacement of Trustee

     A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section 7.08.

     The Trustee may resign in writing at any time and be discharged from the
trust hereby created by so notifying the Company. The Holders of a majority in
principal amount of the then outstanding Notes may remove the Trustee by so
notifying the Trustee and the Company in writing. The Company may remove the
Trustee if:

          (1) the Trustee fails to comply with Section 7.10 hereof;

          (2) the Trustee is adjudged a bankrupt or an insolvent or an order for
     relief is entered with respect to the Trustee under any Bankruptcy Law;

          (3) a Custodian or public officer takes charge of the Trustee or its
     property; or

          (4) the Trustee becomes incapable of acting.

     If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.

     If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 10% in principal amount of the then outstanding Notes may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.

     If the Trustee, after written request by any Holder of Notes who has been a
Holder of a Note for at least six months, fails to comply with Section 7.10
hereof, such Holder of a Note may, on behalf of itself and all others similarly
situated, petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor Trustee.



                                      -74-


     The Company shall give or cause to be given notice of each resignation and
each removal of the Trustee to all Holders in the manner provided herein. Each
notice shall include the name of the successor Trustee and the address of its
Corporate Trust Office.

     A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Thereupon, the resignation or
removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Holders of Notes. The retiring Trustee shall promptly transfer, after payment of
all amounts owing to the Trustee pursuant to Section 7.07 hereof, all property
held by it as Trustee to the successor Trustee; provided that all sums owing to
the Trustee hereunder have been paid and subject to the Lien provided for in
Section 7.07 hereof. Notwithstanding replacement of the Trustee pursuant to this
Section 7.08, the Company's obligations under Section 7.07 hereof shall continue
for the benefit of the retiring Trustee.

SECTION 7.09.  Successor Trustee by Merger, etc.

     If the Trustee consolidates, merges or converts into, or transfers all or
substantially all of its corporate trust business (including the trust created
by this Indenture) to, another corporation, the successor corporation without
any further act shall be the successor Trustee.

SECTION 7.10.  Eligibility; Disqualification

     There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state or territory thereof or of the District of Columbia that is
authorized under such laws to exercise corporate trustee power, that is subject
to supervision or examination by federal, state, territorial or District of
Columbia authorities and that has, or is a wholly owned subsidiary of a bank
holding company that has, a combined capital and surplus of at least $25,000,000
as set forth in its most recent published annual report of condition.

     If at any time the Trustee shall cease to be eligible in accordance with
the provisions of this Section 7.10 it shall resign immediately in the manner
and with the effect specified in this Article 7.

     This Indenture shall always have a Trustee who satisfies the requirements
of the TIA, including TIA ss.ss. 310(a)(1), (2) and (5). The Trustee is subject
to TIA ss. 310(b).

SECTION 7.11.  Preferential Collection of Claims Against Company

     The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.



                                      -75-


                                   ARTICLE 8

                    LEGAL DEFEASANCE AND COVENANT DEFEASANCE

SECTION 8.01.  Option to Effect Legal Defeasance or Covenant Defeasance

     The Company may, at its option, evidenced by an Officers' Certificate, at
any time, with respect to the Notes, elect to have either Section 8.02 or 8.03
hereof be applied to all Notes and Subsidiary Guarantees then outstanding upon
compliance with the conditions set forth in this Article 8.

SECTION 8.02.  Legal Defeasance and Discharge

     Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company and each Guarantor shall, subject
to the satisfaction of the conditions set forth in Section 8.04 hereof, be
deemed to have been discharged from their respective obligations with respect to
all Notes and Subsidiary Guarantees then outstanding on the date the conditions
set forth below are satisfied (hereinafter, "Legal Defeasance"). For this
purpose, Legal Defeasance means that the Company and any Guarantor shall be
deemed to have paid and discharged the entire Indebtedness represented by the
Notes and any Subsidiary Guarantee then outstanding, which shall thereafter be
deemed to be "outstanding" only for the purposes of Section 8.05 hereof and the
other Sections of this Indenture referred to in (a) and (b) below, and to have
satisfied all their other obligations under such Notes and Subsidiary
Guarantees, and this Indenture (and the Trustee, on demand of and at the expense
of the Company, shall execute proper instruments prepared by the Company
acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged hereunder: (a) the rights of Holders of
Notes then outstanding to receive solely from the trust fund described in
Section 8.04 hereof, and as more fully set forth in such Section, payments in
respect of the principal of, premium, if any, interest and Liquidated Damages,
if any, on such Notes when such payments are due, or on the Redemption Date, as
the case may be, (b) the Company's obligations with respect to such Notes under
Sections 2.03, 2.04, 2.05, 2.06, 2.07, 2.10, 4.02 and 4.03 hereof, (c) the
rights, powers, trusts, duties, indemnities and immunities of the Trustee
hereunder and the Company's obligations in connection therewith and (d) this
Article 8. Subject to compliance with this Article 8, the Company may exercise
its option under this Section 8.02 notwithstanding the prior exercise of its
option under Section 8.03 hereof with respect to the Notes.

SECTION 8.03.  Covenant Defeasance

     Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company and each Guarantor shall, subject
to the satisfaction of the conditions set forth in Section 8.04 hereof, be
released from their obligations under the covenants contained in Sections 4.04,
4.05, 4.06, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14 , 4.15, 4.16, 4.17 and 4.18
and Article 5 hereof with respect to the outstanding Notes and the Subsidiary
Guarantees on and after the date the conditions set forth below are satisfied
(hereinafter, "Covenant Defeasance"), and the Notes and the Subsidiary
Guarantees shall thereafter be deemed not to be "outstanding" for the purposes
of any direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed



                                      -76-


"outstanding" for all other purposes hereunder (it being understood that such
Notes and the Subsidiary Guarantees shall not be deemed outstanding for
financial accounting purposes). For this purpose, Covenant Defeasance means
that, with respect to the outstanding Notes and the Subsidiary Guarantees, the
Company and any Guarantor may omit to comply with and shall have no liability in
respect of any term, condition or limitation set forth in any such covenant,
whether directly or indirectly, by reason of any reference elsewhere herein to
any such covenant or by reason of any reference in any such covenant to any
other provision herein or in any other document, and such omission to comply
shall not constitute a Default or Event of Default under Section 6.01(3), (4) or
(5) hereof, but, except as specified above, the remainder of this Indenture and
such Notes shall be unaffected thereby. In addition, upon the Company's exercise
under Section 8.01 hereof of the option applicable to this Section 8.03, subject
to the satisfaction of the conditions set forth in Section 8.04 hereof, Sections
6.01(3) through 6.01(8) hereof shall not constitute Events of Default.

SECTION 8.04.  Conditions to Legal Defeasance or Covenant Defeasance

     The following shall be the conditions to the application of either Section
8.02 or 8.03 hereof to the outstanding Notes and the Subsidiary Guarantees:

     In order to exercise either Legal Defeasance or Covenant Defeasance, as
applicable:

          (a) the Company must irrevocably deposit, or cause to be deposited,
     with the Trustee, in trust, for the benefit of the Holders of Notes and
     without retaining any legal interest in the corpus of such trust, cash in
     U.S. dollars, non-callable Government Securities, or a combination thereof,
     in such amounts as will be sufficient, in the opinion of a nationally
     recognized firm of independent public accountants, to pay and discharge,
     and which shall be applied by the Trustee to pay and discharge, the
     principal of and premium, if any, interest and Liquidated Damages, if any,
     due on the outstanding Notes on the Stated Maturity thereof or on the
     applicable Redemption Date, as the case may be, and the Company must
     specify whether the Notes are being defeased to maturity or to a particular
     Redemption Date;

          (b) in the case of Legal Defeasance, the Company shall have delivered
     to the Trustee an Opinion of Counsel in the United States reasonably
     acceptable to the Trustee confirming that (1) the Company has received
     from, or there has been published by, the U.S. Internal Revenue Service a
     ruling or (2) since the Closing Date, there has been a change in the
     applicable U.S. federal income tax law, in either case to the effect that,
     and based thereon such Opinion of Counsel shall confirm that, the Holders
     of the outstanding Notes will not recognize income, gain or loss for U.S.
     federal income tax purposes, as a result of such Legal Defeasance and will
     be subject to U.S. federal income tax on the same amounts, in the same
     manner and at the same times as would have been the case if such Legal
     Defeasance had not occurred;

          (c) in the case of Covenant Defeasance, the Company shall have
     delivered to the Trustee an Opinion of Counsel in the United States
     reasonably acceptable to the Trustee confirming that the Holders of the
     outstanding Notes will not recognize income, gain or loss for U.S. federal
     income tax purposes as a result of such Covenant Defeasance



                                      -77-


     and will be subject to U.S. federal income tax on the same amounts, in the
     same manner and at the same times as would have been the case if such
     Covenant Defeasance had not occurred;

          (d) no Default or Event of Default shall have occurred and be
     continuing on the date of such deposit (other than a Default or Event of
     Default resulting from the borrowing of funds to be applied to such
     deposit);

          (e) such Legal Defeasance or Covenant Defeasance shall not result in a
     breach or violation of, or constitute a default under, any material
     agreement or instrument (other than this Indenture) to which the Company or
     any of its Subsidiaries is a party or by which the Company or any of its
     Subsidiaries is bound;

          (f) the Company shall have delivered to the Trustee an Opinion of
     Counsel to the effect that after the 91st day following the deposit, the
     trust funds will not be subject to the effect of any applicable bankruptcy,
     insolvency, reorganization or similar laws affecting creditors' rights
     generally;

          (g) the Company shall have delivered to the Trustee an Officers'
     Certificate stating that the deposit was not made by the Company with the
     intent of preferring the Holders of Notes over the other creditors of the
     Company or with the intent of defeating, hindering, delaying or defrauding
     creditors of the Company or others;

          (h) the Company shall have delivered to the Trustee an Officers'
     Certificate and an Opinion of Counsel, each stating that all conditions
     precedent provided for or relating to the Legal Defeasance or the Covenant
     Defeasance, as the case may be, have been complied with; and

          (i) the Trustee shall have received such other documents and
     assurances as the Trustee shall reasonably require.

SECTION 8.05. Deposited Money and Government Securities to be Held in Trust;
              Other Miscellaneous Provisions

     (a) Subject to the provisions of the last paragraph of Section 4.03 hereof
and to Section 8.06 hereof, all money and Government Securities (including the
proceeds thereof) deposited with the Trustee (or other qualifying trustee,
collectively for purposes of this Section 8.05, the "Trustee") pursuant to
Section 8.04 hereof in respect of the Notes then outstanding shall be held in
trust and applied by the Trustee, in accordance with the provisions of such
Notes and this Indenture, to the payment, either directly or through any Paying
Agent as the Trustee may determine, to the Holders of such Notes of all sums due
and to become due thereon in respect of principal, premium, if any, interest and
Liquidated Damages, if any, but such money and Government Securities need not be
segregated from other funds except to the extent required by law.

     (b) The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or Government Securities
deposited pursuant to Section 8.04 hereof or the principal and interest received
in respect thereof other than any such



                                      -78-


tax, fee or other charge which by law is for the account of the Holders of the
Notes then outstanding. This Section 8.05(b) shall survive the termination of
this Indenture, and the earlier removal or resignation of the Trustee.

SECTION 8.06.  Repayment to Company

     Subject to Sections 7.7 and 8.1 hereof, the Trustee shall deliver or pay to
the Company from time to time upon receipt of a written Company Request any
money or Government Securities held by it as provided in Section 8.04 hereof
which, in the opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to the
Trustee (which may be the opinion delivered under Section 8.04(a) hereof)
accompanied by an Officers' Certificate, are in excess of the amount thereof
that would then be required to be deposited to effect an equivalent Legal
Defeasance or Covenant Defeasance.

SECTION 8.07.  Reinstatement

     If the Trustee or Paying Agent is unable to apply any United States dollars
or Government Securities in accordance with Section 8.02 or 8.03 hereof, as the
case may be, by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, then
the Company's and any Guarantor's obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.02 or 8.03 hereof, as the case may be, until such time as the Trustee
or Paying Agent is permitted to apply all such money in accordance with Section
8.02 or 8.03 hereof, as the case may be; provided, however, that if the Company
or any Guarantor makes any payment of principal of, premium, if any, or interest
or Liquidated Damages, if any, on any Notes following the reinstatement of its
obligations, the Company or such Guarantor shall be subrogated to the rights of
the Holders of such Notes to receive such payment from the money or Government
Securities held by the Trustee or Paying Agent.

                                   ARTICLE 9

                                   AMENDMENTS

SECTION 9.01.  Without Consent of Holders

     Notwithstanding Section 9.02 of this Indenture, the Company, the Guarantors
and the Trustee may amend or supplement this Indenture or the Notes without the
consent of any Holder of a Note:

          (1) to cure any ambiguity, defect or inconsistency;

          (2) to provide for uncertificated Notes in addition to or in place of
     certificated Notes;

          (3) to provide for assumption of the Company's or any Guarantor's
     obligations to the Holders of the Notes in the case of a merger,
     consolidation or sale of assets;



                                      -79-


          (4) to provide security for the Notes;

          (5) to add a Guarantor under this Indenture;

          (6) to make any change that would provide any additional rights or
     benefits to the Holders of the Notes or that does not adversely affect the
     legal rights hereunder of any Holder of the Notes in any material respect;
     or

          (7) to comply with requirements of the SEC in order to effect or
     maintain the qualification of this Indenture under the TIA.

     Upon the written request of the Company, and upon receipt by the Trustee of
an Officers' Certificate and an Opinion of Counsel in compliance with Section
1.05 hereof, the Trustee shall join with the Company and the Guarantors in the
execution of any amendment or supplemental indenture authorized or permitted by
the terms of this Indenture and to make any further appropriate agreements and
stipulations that may be therein contained, but the Trustee shall not be
obligated to enter into any such amendment or supplemental indenture that
adversely affects its own rights, duties or immunities under this Indenture or
otherwise.

SECTION 9.02.  With Consent of Holders

     Except as provided below in this Section 9.02, this Indenture, and the
Notes may be amended or supplemented with the consent of the Holders of at least
a majority in principal amount of the Notes then outstanding (including, without
limitation, consents obtained in connection with a purchase of, or tender offer
or exchange offer for, the Notes), and, subject to Sections 6.04 and 6.07
hereof, any existing default or compliance with any provision of this Indenture
or the Notes may be waived with the consent of the Holders of a majority in
principal amount of the then outstanding Notes (including consents obtained in
connection with a tender offer or exchange offer for the Notes).

     Upon the request of the Company, and upon the filing with the Trustee of
evidence satisfactory to the Trustee of the consent of the Holders of Notes as
aforesaid, and upon receipt by the Trustee of an Officers' Certificate and an
Opinion of Counsel in compliance with Section 1.05 hereof, the Trustee shall
join with the Company and the Guarantors in the execution of such amendment or
supplemental indenture unless such amendment or supplemental indenture adversely
affects the Trustee's own rights, duties or immunities under this Indenture or
otherwise, in which case the Trustee may in its discretion, but shall not be
obligated to, enter into such amendment or supplemental indenture.

     It shall not be necessary for the consent of the Holders under this Section
9.02 to approve the particular form of any proposed supplemental indenture or
amendment, but it shall be sufficient if such consent approves the substance
thereof.

     After an amendment, supplement or waiver under this Section 9.02 becomes
effective, the Company shall mail to the Holders of each Note affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amendment or supplemental
indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the



                                      -80-


Holders of a majority in aggregate principal amount of the Notes then
outstanding may waive compliance in a particular instance by the Company with
any provision of this Indenture or the Notes. However, without the consent of
each Holder of Notes affected, an amendment or waiver may not (with respect to
any Note held by a non-consenting Holder):

          (1) reduce the principal amount of the Notes whose Holders must
     consent to an amendment, supplement or waiver;

          (2) reduce the principal of or change the fixed maturity of any Note
     or alter the provisions with respect to the price to be paid, or the timing
     of redemption or payment, upon redemption of the Notes or, after the
     Company has become obligated to make a Change of Control Offer or an Asset
     Sale Offer, amend, change or modify the obligation of the Company to make
     or consummate such Change of Control Offer or Asset Sale Offer;

          (3) reduce the rate of or change the time for payment of interest, or
     Liquidated Damages, if any, on any Note;

          (4) waive a Default or Event of Default in the payment of principal of
     or premium, interest or Liquidated Damages, if any, on the Notes (except a
     rescission of acceleration of the Notes by the Holders of at least a
     majority in aggregate principal amount of the Notes and a waiver of the
     payment default that resulted from such acceleration);

          (5) make any Note payable in money other than that stated in such
     Note;

          (6) except pursuant to Section 12.06 hereof, release any Guarantor
     from its Subsidiary Guarantee;

          (7) make any change in Section 12.04 or Article 10 hereof that
     adversely affects the rights of any Holder of any Notes in any material
     respect or any change to any other provision of this Indenture that
     adversely affects the rights of any Holder of Notes under Section 12.04 or
     Article 10 hereof in any material respect (it being understood that
     amendments to Section 4.09 hereof which may have the effect of increasing
     the amount of Senior Debt that the Company and its Restricted Subsidiaries
     may incur shall not, for purposes of this clause (7), be deemed to be a
     change that adversely affects in a material respect the rights of any
     Holder of Notes under Section 12.04 or Article 10 hereof;

          (8) make any change in the foregoing amendment and waiver provisions
     of this Article 9.

SECTION 9.03.  Compliance with Trust Indenture Act

     Every amendment or supplement to this Indenture or the Notes shall be set
forth in an amendment or supplemental indenture that complies with the TIA as
then in effect.



                                      -81-


SECTION 9.04.  Revocation and Effect of Consents

     Until an amendment, supplement or waiver becomes effective, a consent to it
by a Holder of a Note is a continuing consent by the Holder of a Note and every
subsequent Holder of a Note or portion of a Note that evidences the same debt as
the consenting Holder's Note, even if notation of the consent is not made on any
Note. However, any such Holder of a Note or subsequent Holder of a Note may
revoke the consent as to such Holder's Note or portion of such Note by written
notice to the Trustee received before the date the amendment, supplement or
waiver becomes effective. An amendment, supplement or waiver becomes effective
in accordance with its terms and thereafter binds every Holder of Notes, except
as provided in Section 9.02 hereof.

SECTION 9.05.  Notation on or Exchange of Notes

     The Trustee may, but shall not be required to, place an appropriate
notation about an amendment, supplement or waiver on any Note thereafter
authenticated. The Company in exchange for all Notes may issue and the Trustee
shall authenticate new Notes that reflect the amendment, supplement or waiver.

     Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.

SECTION 9.06.  Trustee to Sign Amendments, etc.

     The Trustee shall sign any amended or supplemental indenture or waiver
authorized pursuant to this Article 9 if the amendment or supplement or waiver
does not adversely affect the rights, duties, liabilities or immunities of the
Trustee. If it does, the Trustee may, but need not, sign it. In signing or
refusing to sign any amended or supplemental indenture or waiver, the Trustee
shall be entitled to receive, if requested, an indemnity satisfactory to it and
to receive and, subject to Section 7.01 hereof, shall be fully protected in
relying upon an Officers' Certificate and an Opinion of Counsel as conclusive
evidence that such amendment or supplemental indenture or waiver is authorized
or permitted by this Indenture, that it is not inconsistent herewith, and that
it will be valid and binding upon the Company and the Guarantors in accordance
with its terms. The Company may not sign an amendment or supplemental indenture
or waiver until the Board of Directors of the Company approves it.

                                   ARTICLE 10

                                 SUBORDINATION

SECTION 10.01.  Agreement to Subordinate

     The Company agrees, and each Holder by accepting a Note agrees, that the
payment (by setoff, redemption, repurchase or otherwise) of principal of,
premium, if any, interest and Liquidated Damages, if any, on the Notes
(including with respect to any repurchases of the Notes) shall be subordinated
in right of payment, as set forth in this Article 10, to the prior payment in
full in cash, or, at the option of the holders of Senior Debt of the Company, in
Cash



                                      -82-


Equivalents, of all Obligations in respect of Senior Debt of the Company,
whether outstanding on the date hereof or hereafter incurred.

SECTION 10.02.  Liquidation; Dissolution; Bankruptcy

     Upon any distribution to creditors of the Company upon any liquidation,
dissolution or winding up of the Company or in a bankruptcy, reorganization,
insolvency, receivership or similar proceeding relating to the Company or its
property, whether voluntary or involuntary, an assignment for the benefit of
creditors or any marshalling of the Company's assets and liabilities, the
holders of Senior Debt of the Company will be entitled to receive payment in
full in cash, or, at the option of the holders of Senior Debt of the Company, in
Cash Equivalents, of all Obligations due or to become due in respect of such
Senior Debt (including interest after the commencement of any such proceeding,
at the rate specified in the applicable Senior Debt) before the Holders of Notes
will be entitled to receive any payment of principal of, premium, if any, or
interest or Liquidated Damages, if any, on the Notes, and until all Obligations
with respect to Senior Debt of the Company are paid in full in cash, or, at the
option of the holders of Senior Debt of the Company, in Cash Equivalents, any
distribution of any kind or character to which the Holders of Notes would be
entitled shall be made to the holders of Senior Debt of the Company (except that
Holders of Notes may receive Permitted Junior Securities and payments made from
the trust described in Article 8 or Article 11 hereof).

SECTION 10.03. Default on Designated Senior Debt

     The Company shall not, directly or indirectly, (x) make any payment of
principal of, premium, if any, or interest or Liquidated Damages, if any, on the
Notes (except in Permitted Junior Securities or from the trust described in
Article 8 or Article 11 hereof if no default of the kind referred to in clause
(i) below had occurred and was continuing, and no Payment Blockage Notice was in
effect, at the time amounts were deposited with the Trustee as described
therein) or (y) acquire any of the Notes for cash or property or otherwise or
make any other distribution with respect to the Notes if:

          (i) any default occurs and is continuing in the payment when due,
     whether at maturity, upon any redemption, by declaration or otherwise, of
     any principal of, premium, if any, or interest on, any Designated Senior
     Debt of the Company, or

          (ii) any other default occurs and is continuing with respect to
     Designated Senior Debt of the Company that permits holders of the
     Designated Senior Debt of the Company as to which such default relates to
     accelerate its maturity and the Trustee receives a notice of such default
     (a "Payment Blockage Notice") from the holders of such Designated Senior
     Debt of the Company.

     The Company may and shall resume payments on the Notes:

          (a) in the case of a payment default, upon the date on which such
     default is cured or waived or otherwise has ceased to exist, and

          (b) in the case of a nonpayment default, upon the earlier of the date
     on which such nonpayment default is cured or waived or otherwise has ceased
     to exist or 179 days



                                      -83-


     after the date on which the applicable Payment Blockage Notice is received,
     unless the maturity of any Designated Senior Debt of the Company has been
     accelerated and such acceleration remains in full force and effect.

     No new period of payment blockage may be commenced unless and until 360
days have elapsed since the effectiveness of the immediately prior Payment
Blockage Notice. No nonpayment default that existed or was continuing on the
date of delivery of any Payment Blockage Notice to the Trustee shall be, or be
made, the basis for a subsequent Payment Blockage Notice unless such nonpayment
default shall have been waived for a period of not less than 90 days.

     The Company shall give prompt written notice to the Trustee of any default
in the payment of any Senior Debt of the Company or any acceleration under any
Senior Debt of the Company or under any agreement pursuant to which Senior Debt
of the Company may have been issued. Failure to give such notice shall not
affect the subordination of the Notes to the Senior Debt of the Company or the
application of the other provisions provided in this Article 10.

SECTION 10.04.  Acceleration of Notes

     If the Company fails to make any payment on the Notes when due or within
any applicable grace period, whether or not on account of the payment blockage
provision referred to above, such failure shall constitute an Event of Default
and shall entitle the Holders of Notes to accelerate the Maturity thereof. The
Company shall promptly notify holders of Senior Debt of the Company and the
Guarantors if payment of the Notes is accelerated because of an Event of
Default.

SECTION 10.05.  When Distribution Must be Paid Over

     In the event that, notwithstanding the foregoing, the Trustee or any Holder
receives, any payment of any principal, premium, interest or Liquidated Damages,
if any, on the Notes at a time when such payment is prohibited by Section 10.02
or 10.03 hereof, such payment shall be held by the Trustee or such Holder, in
trust for the benefit of, and shall be paid forthwith over and delivered to,
upon written request, the holders of Senior Debt of the Company as their
interests may appear or their representative under the indenture or other
agreement (if any) pursuant to which Senior Debt of the Company may have been
issued, as their respective interests may appear, for application to the payment
of all Obligations with respect to Senior Debt of the Company remaining unpaid
to the extent necessary to pay such Obligations in full in accordance with their
terms, after giving effect to any concurrent payment or distribution to or for
the holders of such Senior Debt.

     Each Holder by his acceptance of a Note irrevocably agrees that if any
payment or payments shall be made pursuant to this Indenture and the amount or
total amount of such payment or payments exceeds the amount, if any, that such
Holder would be entitled to receive upon the proper application of the
subordination provisions of this Article 10, such Holder agrees that it will be
obliged to pay over the amount of the excess payment to the holders of Senior
Debt



                                      -84-


of the Person that made such payment or payments or their representative or
representatives, as instructed in a written notice of such excess payment,
within ten days of receiving such notice.

     With respect to the holders of Senior Debt of the Company, the Trustee
undertakes to perform only such obligations on the part of the Trustee as are
specifically set forth in this Article 10, and no implied covenants or
obligations with respect to the holders of Senior Debt of the Company shall be
read into this Indenture against the Trustee. The Trustee shall not be deemed to
owe any fiduciary duty to the holders of Senior Debt of the Company, and shall
not be liable to any such holders if the Trustee shall pay over or distribute to
or on behalf of Holders or the Company or any other Person, money or assets to
which any holders of Senior Debt of the Company shall be entitled by virtue of
this Article 10, except if such payment is made as a result of the willful
misconduct or gross negligence of the Trustee.

SECTION 10.06.  Notice by Company

     The Company shall promptly notify the Trustee and the Paying Agent of any
facts known to the Company that would cause a payment of principal of, premium,
if any, interest or Liquidated Damages, if any, on the Notes to violate this
Article 10, but failure to give such notice shall not affect the subordination
of the Notes to Senior Debt as provided in this Article 10.

SECTION 10.07.  Subrogation

     After all Senior Debt of the Company is paid in full and until the Notes
are paid in full in cash, Holders of Notes shall be subrogated (equally and
ratably with all other Indebtedness pari passu with the Notes) to the rights of
holders of Senior Debt of the Company to receive distributions applicable to
Senior Debt of the Company to the extent that distributions otherwise payable to
the Holders of Notes have been applied to the payment of Senior Debt of the
Company. A distribution made under this Article 10 to holders of Senior Debt of
the Company that otherwise would have been made to Holders of Notes is not, as
between the Company and Holders, a payment by the Company on such Senior Debt.

     If any payment or distribution to which the Holders of Notes would
otherwise have been entitled but for the provisions of this Article 10 shall
have been applied, pursuant to the provisions of this Article 10, to the payment
of amounts payable under the Senior Debt of the Company, then and in such case
the Holders shall be entitled to receive from the holders of such Senior Debt at
the time outstanding any payments or distributions received by such holders of
such Senior Debt in excess of the amount sufficient to pay all amounts payable
under or respect of such Senior Debt in full; provided that such payments or
distributions shall be paid first pro rata to Holders of Notes that previously
paid amounts then pro rata to all Holders of Notes.

SECTION 10.08.  Relative Rights

     This Article 10 defines the relative rights of Holders of Notes and holders
of Senior Debt of the Company. Nothing in this Indenture shall:



                                      -85-


          (1) impair, as between the Company and Holders of Notes, the
     obligation of the Company, which is absolute and unconditional, to pay
     principal of, premium, if any, interest and Liquidated Damages, if any, on
     the Notes in accordance with their terms;

          (2) affect the relative rights of Holders of Notes and creditors of
     the Company other than their rights in relation to holders of Senior Debt
     of the Company; or

          (3) prevent the Trustee or any Holder of Notes from exercising its
     available remedies upon a Default or an Event of Default, subject to the
     rights of holders and owners of Senior Debt of the Company to receive
     distributions and payments otherwise payable to Holders of Notes.

     If the Company fails because of this Article 10 to pay principal of,
premium, if any, interest or Liquidated Damages, if any, on, a Note on the due
date, the failure is nevertheless a Default or an Event of Default.

SECTION 10.09. Subordination May Not be Impaired by Company

     No right of any holder of Senior Debt of the Company to enforce the
subordination of the Indebtedness evidenced by the Notes shall be impaired by
any act or failure to act by the Company or any Holder or by the failure of the
Company or any Holder to comply with this Indenture.

SECTION 10.10. Distribution or Notice to Representative

     Whenever a distribution is to be made or a notice given to holders of
Senior Debt of the Company, the distribution may be made and the notice given to
their representative.

     Upon any payment or distribution of assets of the Company referred to in
this Article 10, the Trustee and the Holders of the Notes shall be entitled to
conclusively rely upon any order or decree made by any court of competent
jurisdiction or upon any certificate of such representative or of the
liquidating trustee or agent or other Person making any distribution to the
Trustee or to the Holders of the Notes for the purpose of ascertaining the
Persons entitled to participate in such distribution, the holders of the Senior
Debt and other Indebtedness of the Company, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and all other facts
pertinent thereto or to this Article 10.

SECTION 10.11.  Rights of Trustee and Paying Agent

     Notwithstanding the provisions of this Article 10 or any other provision of
this Indenture, the Trustee shall not be charged with knowledge of the existence
of any facts that would prohibit the making of any payment or distribution by
the Trustee, and the Trustee and the Paying Agent may continue to make payments
on the Notes, unless a Responsible Officer of the Trustee shall have received at
its Corporate Trust Office at least five Business Days prior to the date of such
payment written notice of facts that would cause the payment of any principal
of, premium, if any, interest or Liquidated Damages, if any, on, the Notes to
violate this Article 10. Only the Company or a representative may give the
notice. Nothing in this Article 10 shall impair the claims of, or payments to,
the Trustee under or pursuant to Section 7.07 hereof.



                                      -86-


     The Trustee in its individual or any other capacity may hold Senior Debt
with the same rights it would have if it were not Trustee. Any Agent may do the
same with like rights.

SECTION 10.12.  Authorization to Effect Subordination

     Each Holder of a Note by the Holder's acceptance thereof authorizes and
directs the Trustee on such Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination as provided in this
Article 10, and appoints the Trustee to act as such Holder's attorney-in-fact
for any and all such purposes. If the Trustee does not file a proper proof of
claim or proof of debt in the form required in any proceeding referred to in
Section 6.09 hereof at least 30 days before the expiration of the time to file
such claim, a representative of Designated Senior Debt of the Company is hereby
authorized to file an appropriate claim for and on behalf of the Holders of
Notes.

                                   ARTICLE 11



                           SATISFACTION AND DISCHARGE

SECTION 11.01.  Satisfaction and Discharge of Indenture

     This Indenture shall be discharged and will cease to be of further effect
as to all Notes issued hereunder, except for Sections 7.07 and 8.05(b) hereof,
which shall survive the satisfaction and discharge of this Indenture, when
either

     (a) all such Notes theretofore authenticated and delivered (except lost,
stolen or destroyed Notes which have been replaced or paid and Notes for whose
payment money has theretofore been deposited in trust and thereafter repaid to
the Company) have been delivered to the Trustee for cancellation; or

     (b) (i) all such Notes not theretofore delivered to the Trustee for
cancellation have become due and payable, will become due and payable within one
year or are to be called for redemption within one year under irrevocable
arrangements satisfactory to the Trustee for the giving of notice of redemption
by the Trustee in the name and at the expense of the Company and the Company has
irrevocably deposited or caused to be deposited with the Trustee, in trust,
funds in an amount sufficient to pay and discharge the entire indebtedness on
the Notes not theretofore delivered to the Trustee for cancellation, for
principal of (and premium, if any, on) and interest and Liquidated Damages, if
any, to the date of maturity or date of redemption,

          (ii) the Company has paid or caused to be paid all sums payable by the
     Company under this Indenture, and

          (iii) the Company has delivered an Officers' Certificate and an
     Opinion of Counsel to the Trustee stating that all conditions precedent to
     satisfaction and discharge have been satisfied.



                                      -87-


SECTION 11.02.  Application of Trust Money

     Subject to the provisions of the last paragraph of Section 4.03 all money
deposited with the Trustee pursuant to Section 11.01 hereof shall be held in
trust and applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent as the
Trustee may determine, to Persons entitled thereto, of the principal (and
premium, if any) and interest and Liquidated Damages, if any, for whose payment
such money has been deposited with the Trustee.

     If the Trustee or Paying Agent is unable to apply any money in accordance
with Section 11.01 hereof by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company's and any Guarantor's obligations under this Indenture
and the Notes shall be revived and reinstated as though no such deposit had
occurred pursuant to Section 11.01 hereof; provided that if the Company or any
Guarantor has made any payment of principal of, premium, if any, or interest or
Liquidated Damages, if any, on, any Notes following the reinstatement of its
obligations, the Company or such Guarantor shall be subrogated to the rights of
the Holders of such Notes to receive such payment from the money held by the
Trustee or Paying Agent.

                                   ARTICLE 12

                             SUBSIDIARY GUARANTEES

SECTION 12.01.  Subsidiary Guarantee

     For value received, the Guarantors, jointly and severally, hereby
unconditionally guarantee to the Holders of the Notes and to the Trustee the due
and punctual payment of the principal of, premium, if any, and interest and
Liquidated Damages, if any, (including interest and Liquidated Damages, if any,
accruing on or after the filing of a petition in bankruptcy or reorganization
relating to the Company, whether or not a claim for post-filing interest or
Liquidated Damages is allowed in such proceeding) on, the Notes, and all other
amounts payable by the Company under the Notes and under this Indenture
(collectively, the "Guaranteed Obligations"), when and as the same shall become
due and payable, whether at the stated maturity or by declaration of
acceleration, call for redemption or otherwise, according to the terms of the
Notes and this Indenture. Each Subsidiary Guarantee pursuant to this Article 12
constitutes a guarantee of payment in full when due and not merely a guarantee
of collectibility. Notwithstanding the foregoing, each Guarantor's liability
under this Section 12.01 shall be limited to the maximum amount that would not
result in such Guarantor's Subsidiary Guarantee under this Section 12.01
constituting a fraudulent conveyance or fraudulent transfer under applicable
law.

SECTION 12.02. Obligation of the Guarantors Unconditional

     Except as provided in Section 12.06 hereof, the obligations of each
Guarantor hereunder shall be as aforesaid absolute and unconditional, and shall
not be impaired, modified, released or limited by any occurrence or condition
whatsoever, including, without limitation, (i) any compromise, settlement,
release, waiver, renewal, extension, indulgence or modification of, or



                                      -88-


any change in, any of the obligations and liabilities of the Company contained
in the Notes or this Indenture, (ii) any impairment, modification, release or
limitation of the liability of the Company or its estate in bankruptcy, or any
remedy for the enforcement thereof, resulting from the operation of any present
or future provision of any applicable Bankruptcy Law, as amended, or other
statute or from the decision of any court, (iii) the assertion or exercise by
the Company, the Holders of Notes or the Trustee of any rights or remedies under
the Notes or this Indenture or their delay in or failure to assert or exercise
any such rights or remedies, (iv) the assignment or the purported assignment of
any property as additional security for the Notes, including all or any part of
the rights of the Company under this Indenture, (v) the extension of the time
for payment by the Company of any payments or other sums or any part thereof
owing or payable under any of the terms and provisions of the Notes or this
Indenture or of the time for performance by the Company of any other obligations
under or arising out of any such terms and provisions or the extension or the
renewal of any thereof, (vi) the modification or amendment (whether material or
otherwise) of any duty, agreement or obligation of the Company set forth in this
Indenture or the Notes, (vii) the voluntary or involuntary liquidation,
dissolution, sale or other disposition of all or substantially all of the
assets, marshalling of assets and liabilities, receivership, insolvency,
bankruptcy, assignment for the benefit of creditors, reorganization,
arrangement, composition or readjustment of, or other similar proceeding
affecting, the Company, or any of the Guarantors or any of their respective
assets, or the disaffirmance of this Subsidiary Guarantee pursuant to this
Article 12 or the Notes or this Indenture in any such proceeding, (viii) the
release or discharge of the Company from the performance or observance of any
agreement, covenant, term or condition contained in any of such instruments by
operation of law, (ix) the unenforceability of the Notes or this Indenture or
any Subsidiary Guarantee pursuant to this Article 12, or (x) any other
circumstance which might otherwise constitute a legal or equitable discharge of
a surety or guarantor.

SECTION 12.03. Waiver Relating to Subsidiary Guarantees

     Each Guarantor hereby (i) waives diligence, presentment, demand of payment,
filing of claims with a court in the event of the merger, insolvency or
bankruptcy of the Company, any right to require a proceeding first against the
Company or to realize on any collateral, protest or notice with respect to the
Guaranteed Obligations and all demands whatsoever, (ii) acknowledges that any
agreement, instrument or document evidencing the Guaranteed Obligations may be
transferred and that the benefit of its obligations hereunder shall extend to
each holder of any agreement, instrument or document evidencing the Guaranteed
Obligations without notice to them, and (iii) covenants that its Subsidiary
Guarantee pursuant to this Article 12 will not be discharged except pursuant to
Section 12.05 hereof or by complete payment and performance of the Guaranteed
Obligations and of its Subsidiary Guarantee pursuant to this Article 12.

SECTION 12.04.  Subordination of Subsidiary Guarantees

     Each Guarantee of a Guarantor under this Article 12 is subordinate and
junior in right of payment to the prior payment in full, in cash, or at the
option of the holders of Senior Debt of such Guarantor, in Cash Equivalents, of
all Senior Debt of such Guarantor, including any Guarantee issued by such
Guarantor that constitutes Senior Debt of such Guarantor, to the same extent and
in the same manner to which the Notes are subordinated pursuant to Article 10
hereof



                                      -89-


to the Senior Debt of the Company, and all provisions of Article 10 hereof
applicable to the subordination of the Notes shall similarly apply to the
subordination of the Subsidiary Guarantees pursuant to this Article 12.

SECTION 12.05.  Guarantors May Consolidate, etc., on Certain Terms

     Subject to Section 12.06 hereof, no Guarantor (including any existing or
future Restricted Subsidiary that becomes an additional Guarantor) may
consolidate with or merge with or into (whether or not such Guarantor is the
surviving Person) another Person, whether or not affiliated with such Guarantor,
or sell, assign, transfer, lease, convey or otherwise dispose of all or
substantially all of its properties or assets in one or more related
transactions to another Person, unless (i) the Person formed by or surviving any
such consolidation or merger (if other than such Guarantor) or to which such
sale, assignment, transfer, lease, conveyance or other disposition shall have
been made is a Person organized and existing under the laws of the United States
of America, any state thereof, or the District of Columbia and expressly assumes
all the obligations of such Guarantor, pursuant to a supplemental indenture in
form and substance reasonably satisfactory to the Trustee, under the Notes and
this Indenture and (ii) immediately after giving effect to such transaction, no
Default or Event of Default exists. In connection with any consolidation or
merger contemplated by this Section 12.05, the Company shall deliver to the
Trustee prior to the consummation of the proposed transaction an Officers'
Certificate and an Opinion of Counsel, each stating that such consolidation or
merger and such supplemental indenture comply with this Article 12 and that all
conditions precedent herein provided relating to such transaction have been
complied with.

     The provisions of clause (i) of the preceding paragraph shall not apply if
the Person formed by or surviving the relevant consolidation or merger or to
which the relevant sale, assignment, transfer, lease, conveyance or other
disposition shall have been made is the Company, a Guarantor or a Person that is
not, after giving effect to such transaction, a Restricted Subsidiary of the
Company.

SECTION 12.06.  Release of Subsidiary Guarantee

     In the event of (i) a merger or consolidation to which a Guarantor is a
party, then the Person formed by or surviving such merger or consolidation (if,
after giving effect to such transaction, other than the Company or a Restricted
Subsidiary of the Company) shall be released and discharged from the obligations
of such Guarantor under its Subsidiary Guarantee, (ii) a sale or other
disposition (whether by merger, consolidation or otherwise) of all of the Equity
Interests of a Guarantor at the time owned by the Company and its Restricted
Subsidiaries to any Person that, after giving effect to such transaction, is
neither the Company nor a Restricted Subsidiary of the Company, or (iii) the
release and discharge of a Guarantor from all obligations under Guarantees of
(x) Obligations under the Credit Agreement and (y) any other Indebtedness of the
Company or any of its Restricted Subsidiaries, then, in each such case, such
Guarantor shall be released and discharged from its obligations under its
Subsidiary Guarantee; provided that, in the case of each of clauses (i) and (ii)
above, (A) the relevant transaction is in compliance with the terms of this
Indenture and (B) the Person being released and discharged shall have been
released and discharged from all obligations it might otherwise have under
Guarantees of Indebtedness of the Company or any of its Restricted Subsidiaries
and, in the case of each of



                                      -90-


clauses (i), (ii) and (iii) above, immediately after giving effect to such
transaction, no Default or Event of Default shall exist.

     Upon any Guarantor ceasing to be a Guarantor pursuant to any provision of
this Indenture, at the request of the Company which request shall be accompanied
by an Officers' Certificate and an Opinion of Counsel, each certifying that no
Event of Default (or event or condition which with the giving of notice or the
passage of time would become an Event of Default) exists and is continuing and
that all conditions precedent herein provided relating to this Section 12.06
have been complied with, the Trustee shall execute and deliver an appropriate
instrument evidencing any such release. Any Guarantor not released from its
obligations under its Guarantee shall remain liable for the full amount of
principal of, premium, if any, and interest and Liquidated Damages, if any, on
the Notes and for the other obligations of such Guarantor under this Indenture
as and to the extent provided in this Indenture.

SECTION 12.07.  Contribution of Guarantors

     In the event that any Guarantor (such Guarantor being herein referred to as
the "Funding Party") shall make a payment under its Subsidiary Guarantee
pursuant to this Article 12, it shall be entitled to a contribution from each
other Guarantor (each, a "Contributor") in the amount of such Contributor's pro
rata share of the amount of such payment by such Funding Party so long as
exercise of such right does not impair the rights of Holders of Notes under any
Subsidiary Guarantee. The failure of a Contributor to discharge its obligations
under this Section 12.07 shall not affect the obligations of any Guarantor under
its Subsidiary Guarantee pursuant to this Article 12. The obligations under this
Section 12.07 shall be unaffected by any of the events described in Section
12.02 or any comparable events pertaining to the Funding Party, its Subsidiary
Guarantee or the undertakings in this Section 12.07.

SECTION 12.08.  Reinstatement of Subsidiary Guarantees

     Each Guarantee pursuant to this Article 12 shall, to the fullest extent
permitted by law, continue to be effective or be reinstated, as the case may be,
if at any time payment and performance of any of the Guaranteed Obligations is,
pursuant to applicable law, rescinded or reduced in amount, or must otherwise be
restored or returned by any Holder of Notes or by the Trustee, whether as a
"voidable preference," "fraudulent conveyance," "fraudulent transfer," or
otherwise, all as though such payment or performance had not been made. In the
event that any payment, or any part thereof, is rescinded, reduced, restored or
returned, the Guaranteed Obligations shall, to the fullest extent permitted by
law, be reinstated and deemed reduced only by such amount paid and not so
rescinded, reduced, restored or returned.

                                   ARTICLE 13

                                 MISCELLANEOUS

SECTION 13.01.  Trust Indenture Act Controls

     If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by TIA ss. 318(c), the imposed duties shall control.



                                      -91-


SECTION 13.02.  Notices

     Any notice or communication by the Company, any Guarantor or the Trustee to
the others is duly given if in writing and delivered by hand delivery, by
first-class mail (registered or certified, return receipt requested), by
facsimile or by overnight air courier guaranteeing next day delivery, to the
others' addresses as follows:

     If to the Company or any Guarantor:

               Vail Resorts, Inc.
               137 Benchmark Road
               Avon, Colorado 81620
               Attention: James P. Donohue
               Chief Financial Officer
               Telecopier No.: (970) 845-2521

     If to the Trustee:

               The Bank of New York
               c/o United States Trust Company of New York
               114 West 47th Street
               New York, New York 10036
               Attention: Corporate Trust Department
               Telecopier No.: (212) 852-1625

     The Company, any Guarantor or the Trustee by notice to the others may
designate additional or different addresses of subsequent notices or
communications.

     All notices and communications (other than those sent to Holders of Notes)
shall be deemed to have been duly received: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when receipt is confirmed, if sent by facsimile; and
the next Business Day after timely delivery to the courier, if sent by overnight
air courier guaranteeing next day delivery.

     Any notice or communication to a Holder of Notes shall be mailed by
first-class mail, certified or registered, return receipt requested, to his
address shown on the register kept by the Registrar. Failure to mail a notice or
communication to a Holder of Notes or any defect in it shall not affect its
sufficiency with respect to other Holders of Notes.

     If a notice or communication is mailed in the manner provided above within
the time prescribed, it is duly given, whether or not the addressee receives it.

     If the Company mails a notice or communication to Holders of Notes, it
shall mail a copy to the Trustee and each Agent at the same time.



                                      -92-


SECTION 13.03.  Communication by Holders with Other Holders

     Holders of Notes may communicate pursuant to TIA ss.312(b) with other
Holders of Notes with respect to their rights under this Indenture or the Notes.
The Company, any Guarantor, the Trustee, the Registrar and anyone else shall
have the protection of TIA ss.312(c). Upon qualification of this Indenture under
the TIA, the Trustee shall otherwise comply with TIA ss.312(b).

SECTION 13.04.  Certificate and Opinion as to Conditions Precedent

     Upon any request or application by the Company and/or any Guarantor to the
Trustee to take any action under this Indenture, the Company and/or any
Guarantor, as the case may be, shall furnish to the Trustee:

          (1) an Officers' Certificate in form and substance reasonably
     satisfactory to the Trustee (which shall include the statements set forth
     in Section 1.05 hereof) stating that, in the opinion of the signers, all
     conditions precedent and covenants, if any provided for in this Indenture
     relating to the proposed action have been complied with; and

          (2) an Opinion of Counsel in form and substance reasonably
     satisfactory to the Trustee (which shall include the statements set forth
     in Section 1.05 hereof) stating that, in the opinion of such counsel, all
     such conditions precedent and covenants have been complied with.

SECTION 13.05.  Rules by Trustee and Agents

     The Trustee may make reasonable rules for action by or at a meeting of
Holders of Notes. The Registrar or Paying Agent may make reasonable rules and
set reasonable requirements for its functions.

SECTION 13.06.  Legal Holidays

     In any case where any Interest Payment Date, any date established for
payment of Defaulted Interest pursuant to Section 2.12 hereof, or any Maturity
with respect to any Note shall not be a Business Day, then (notwithstanding any
other provisions of this Indenture) or the Notes payment of interest or
Liquidated Damages, if any, or principal (and premium, if any) need not be made
on such date but may be made on the next succeeding Business Day with the same
force and effect as if made on the Interest Payment Date or date established for
payment of Defaulted Interest pursuant to Section 2.12 hereof or Maturity, and
no interest shall accrue with respect to such payment for the period from and
after such Interest Payment Date or date established for payment of Defaulted
Interest pursuant to Section 2.12 or Maturity, as the case may be, to the next
succeeding Business Day.

SECTION 13.07. No Personal Liability of Directors, Officers, Employees,
               Incorporators and Stockholders

     No director, officer, employee, incorporator or stockholder of the Company
or any Guarantor, as such, shall have any liability for any obligations of the
Company or such



                                      -93-


Guarantor under the Notes or this Indenture or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Holder of
Notes by accepting a Note waives and releases all such liability. The waiver and
release shall be part of the consideration for the issuance of the Notes.

SECTION 13.08.  Governing Law; Submission to Jurisdiction

     THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED ENTIRELY WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICT OF LAWS. BY THE EXECUTION AND DELIVERY OF THIS
INDENTURE, EACH OF THE COMPANY AND THE GUARANTORS SUBMITS TO THE JURISDICTION OF
ANY FEDERAL OR STATE COURT IN THE STATE OF NEW YORK IN ANY SUIT OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS INDENTURE.

SECTION 13.09.  No Adverse Interpretation of Other Agreements

     This Indenture may not be used to interpret any other indenture, loan or
debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.

SECTION 13.10.  Successors and Assigns

     All covenants and agreements in this Indenture and the Notes by the Company
and the Guarantors shall bind their respective successors and assigns. All
covenants and agreements in this Indenture by the Trustee shall bind its
successor and assigns.

SECTION 13.11.  Severability

     In case any one or more of the provisions in this Indenture or in the Notes
shall be held invalid, illegal or unenforceable in any jurisdiction, in any
respect for any reason, the validity, legality and enforceability of any such
provision in every other jurisdiction and in every other respect, and of the
remaining provisions, shall not in any way be affected or impaired thereby, it
being intended that all of the provisions hereof shall be enforceable to the
full extent permitted by law.

SECTION 13.12.  Counterpart Originals

     This Indenture may be executed in any number of counterparts, each of which
shall be deemed to be an original, but all of them together shall represent the
same agreement.

SECTION 13.13.  Table of Contents, Headings, etc.

     The Table of Contents, Cross-Reference Table and Headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part hereof and shall in no way modify or
restrict any of the terms or provisions hereof.



                                      -94-


                        [Signatures on following pages]











                                      -95-


     IN WITNESS WHEREOF, the undersigned have caused this Indenture to be
executed as of the date first above written.

                                   VAIL RESORTS, INC.


                                   By:   /s/ James P. Donohue
                                         -------------------------------------
                                         Name:   James P. Donohue
                                         Title:  Senior Vice President














































                   [Indenture Signature Page for the Company]


                                      -96-



Beaver Creek Associates, Inc.
Beaver Creek Consultants, Inc.
Beaver Creek Food Services, Inc.
Breckenridge Resort Properties, Inc.
Complete Telecommunications, Inc.
GHTV, Inc.
Gillett Broadcasting, Inc.
Grand Teton Lodge Company
Jackson Hole Golf and Tennis Club, Inc.
JHL&S LLC
Keystone Conference Services, Inc.
Keystone Development Sales, Inc.
Keystone Food and Beverage Company
Keystone Resort Property Management Company
Larkspur Restaurant & Bar, LLC
Lodge Properties, Inc.
Lodge Realty, Inc.
Property Management Acquisition Corp., Inc.
Teton Hospitality LLC
Teton Hospitality Services, Inc.
The Vail Corporation
The Village at Breckenridge Acquisition Corp., Inc.
Vail Associates Consultants, Inc.
Vail Associates Holdings, Ltd.
Vail Associates Management Company
Vail Associates Real Estate, Inc.
Vail Food Services, Inc.
Vail Holdings, Inc.
Vail Resorts Development Company
Vail Summit Resorts, Inc.
Vail Trademarks, Inc.
Vail/Arrowhead, Inc.
Vail/Battle Mountain, Inc.
Vail/Beaver Creek Resort Properties, Inc.
VAMHC, Inc.
Vail RR, Inc.
VA Rancho Mirage I, Inc.
VA Rancho Mirage II, Inc.



Each by its authorized officer:

By: /s/ James P. Donohue
    --------------------------------
    Name:   James P. Donohue
    Title:  Senior Vice President



                   [Indenture Signature Page for Guarantors]


                                      -97-





THE BANK OF NEW YORK, as Trustee


By:  /s/ Cynthia Chaney
    -------------------------------
    Name:   Cynthia Chaney
    Title:  Authorized Signer





















                     [Indenture Signature Page for Trustee]


                                      -98-



                                                                       EXHIBIT A

                                 [Face of Note]

[FOR GLOBAL NOTES: THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY
BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY
BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE
MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF
THE COMPANY.]

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS,
EXCEPT AS SET FORTH BELOW. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS
THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER
THE SECURITIES ACT) (A "QIB") OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING
THE NOTE EVIDENCED HEREBY IN AN OFFSHORE TRANSACTION, (2) AGREES THAT IT WILL
NOT, WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS SECURITY RESELL OR
OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO THE COMPANY OR ANY SUBSIDIARY
THEREOF, (B) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN
COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES
TO AN ACCREDITED INVESTOR (AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER
THE SECURITIES ACT) THAT, PRIOR TO SUCH TRANSFER, FURNISHES (OR HAS FURNISHED ON
ITS BEHALF BY A U.S. BROKER-DEALER) TO THE TRUSTEE A SIGNED LETTER CONTAINING
CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER
OF THIS SECURITY (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE FOR
THIS SECURITY), (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (E) PURSUANT
TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT
(IF AVAILABLE), OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS
SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN
CONNECTION WITH ANY TRANSFER OF THIS SECURITY WITHIN ONE YEAR AFTER THE ORIGINAL
ISSUANCE OF THIS SECURITY, IF THE PROPOSED TRANSFEREE IS AN ACCREDITED INVESTOR,
THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH THE TRUSTEE AND THE COMPANY
SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS EITHER OF THEM MAY
REASONABLY



                                      -99-


REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED
STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER
THE SECURITIES ACT.

                                                           CUSIP: ______________

No. ____                                                     U.S.$______________

                               VAIL RESORTS, INC.

                   8 3/4% Senior Subordinated Notes due 2009

     VAIL RESORTS, INC., a Delaware corporation. for value received, promises to
pay to __________________________, or its registered assigns, the principal sum
of _____________________________________ AND NO/100 UNITED STATES DOLLARS
(U.S.$___________) on May 15, 2009.

     Interest Payment Dates: May 15 and November 15

     Record Dates: May 1 and November 1

     Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.









                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]


                                     -100-



     IN WITNESS WHEREOF, the Company has caused this Note to be signed manually
or by facsimile by its duly authorized officers.

                                   VAIL RESORTS, INC.

                                   By:______________________________________
                                      Name:
                                      Title:

                                   By:______________________________________
                                      Name:
                                      Title:



Dated:
(Trustee's Certificate of Authentication)

This is one of the Notes referred to
in the within-mentioned Indenture:

THE BANK OF NEW YORK, as Trustee


By: __________________________________
          Authorized Signatory













                                     -101-


                             [Reverse Side of Note]

                               VAIL RESORTS, INC.

                   8 3/4% Senior Subordinated Notes due 2009

     Capitalized terms used herein shall have the meanings assigned to them in
the Indenture referred to below unless otherwise indicated.

1.       Interest.

     VAIL RESORTS, INC., a Delaware corporation (the "Company", which term
includes any successor under the Indenture hereinafter referred to), promises to
pay interest on the principal amount of this Note at 8 3/4% per annum from
November 21, 2001 until maturity and to pay Liquidated Damages, if any, payable
pursuant to the Registration Rights Agreement referred to below. The Company
will pay interest and Liquidated Damages, if any, semi-annually in arrears on
May 15 and November 15 of each year, or if any such day is not a Business Day,
on the next succeeding Business Day (each, an "Interest Payment Date"). Interest
on the Notes will accrue from the most recent date to which interest has been
paid or, if no interest has been paid, from the date of issuance; provided that
if there is no existing Default in the payment of interest, and if this Note is
authenticated between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided, further, that the first Interest
Payment Date shall be May 15, 2002. The Company shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal and premium, if any, from time to time on demand at a rate equal to 1%
per annum in excess of the rate then in effect; it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest and Liquidated Damages, if any (without regard to any
applicable grace periods), from time to time on demand at the same rate to the
extent lawful. Interest will be computed on the basis of a 360-day year of
twelve 30-day months.

2.       Method of Payment.

     The Company will pay interest on the Notes (except defaulted interest) and
Liquidated Damages, if any, to the Persons who are registered Holders of Notes
at the close of business on the May 1 or November 1 next preceding the Interest
Payment Date, even if such Notes are canceled after such record date and on or
before such Interest Payment Date, except as provided in Section 2.12 of the
Indenture with respect to defaulted interest. The Notes will be payable as to
principal, premium and Liquidated Damages, if any, and interest at the office or
agency of the Company maintained for such purpose within or without the City and
State of New York, or, at the option of the Company, payment of interest and
Liquidated Damages, if any, may be made by check mailed to the Holders at their
addresses set forth in the register of Holders, and provided that payment by
wire transfer of immediately available funds will be required with respect to
principal of and interest, premium and Liquidated Damages, if any, on, all
Global Notes and all other Notes the Holders of which shall have provided wire
transfer instructions to the Company or the Paying Agent. Such payment shall be
in such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public and private debts.



                                     -102-


3.       Paying Agent and Registrar.

     Initially, The Bank of New York, the Trustee under the Indenture, will act
as Paying Agent and Registrar. The Company may change any Paying Agent or
Registrar without notice to any Holder. The Company or any of its Subsidiaries
may not act in any such capacity.

4.       Indenture.

     The Company issued the Notes under an Indenture dated as of November 21,
2001 (the "Indenture") among the Company, the Guarantors named on the signature
pages thereto and the Trustee. The terms of the Notes include those stated in
the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code ss.ss. 77aaa-77bbbb). The Notes
are subject to all such terms, and Holders are referred to the Indenture and
such Act for a statement of such terms. To the extent any provision of this Note
conflicts with the express provisions of the Indenture, the provisions of the
Indenture shall govern and be controlling. The Notes are general obligations of
the Company limited to $300 million in aggregate principal amount.

5.       Optional Redemption.

     (a) Except as set forth in subparagraphs (b) and (c) of this Paragraph 5,
the Company shall not have the option to redeem the Notes prior to May 15, 2004.
Thereafter, the Company shall have the option to redeem the Notes, in whole or
in part, upon not less than 30 nor more than 60 days' notice, at the redemption
prices (expressed as percentages of principal amount) set forth below plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to the
applicable redemption date, if redeemed during the twelve-month period beginning
on May 15 of the years indicated below:

     Year                                          Percentage
     ----                                          ----------

     2004 ...................................      104.375%
     2005 ...................................      102.916%
     2006 ...................................      101.458%
     2007 and thereafter ....................      100.000%

     (b) Notwithstanding the provisions of subparagraph (a) of this Paragraph 5,
at any time on or prior to May 15, 2002, the Company may on one or more
occasions redeem up to 35% of the aggregate principal amount of Notes
theretofore issued under the Indenture at a redemption price of 108.75% of the
principal amount thereof, plus accrued and unpaid interest and Liquidated
Damages, if any, to the redemption date, with the net cash proceeds of one or
more Equity Offerings; provided that (i) at least 65% of the aggregate principal
amount of Notes theretofore issued remains outstanding immediately following
each such redemption and (ii) the redemption shall occur within 60 days of the
closing of any such Equity Offering.

     (c) In addition, at any time prior to May 15, 2004, following the
occurrence of a Change of Control, the Notes will be subject to redemption at
the option of the Company, in whole or in part, upon not less than 30 nor more
than 60 days' notice given within 30 days following such Change of Control, at
the Make-Whole Price, plus accrued and unpaid interest and Liquidated Damages,
if any, thereon to the applicable Redemption Date.



                                     -103-


6.       Notice of Redemption.

     A notice of redemption will be mailed at least 30 days but not more than 60
days before the redemption date to each Holder whose Notes are to be redeemed at
its registered address. Notes in denominations larger than $1,000 may be
redeemed in part but only in whole multiples of $1,000. On and after the
redemption date, unless the Company defaults in making the redemption payments,
interest and Liquidated Damages, if any, ceases to accrue on Notes or portions
thereof called for redemption.

7.       Mandatory Redemption.

     Except as set forth in paragraph 8 below, the Company shall not be required
to make mandatory redemption payments with respect to the Notes.

8.       Repurchase at Option of Holder.

     (a) If there is a Change of Control, unless notice of redemption of the
Notes in whole has been given pursuant to Sections 3.04 and 3.08 of the
Indenture, the Company shall be required to make an offer (a "Change of Control
Offer") to purchase all or any part (equal to $1,000 or an integral multiple
thereof) of each Holder's Notes at an offer price in cash equal to 101% of the
aggregate principal amount thereof, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the date of purchase (the "Change of
Control Payment"). Notice of a Change of Control Offer shall be mailed within 30
days following a Change of Control to each Holder of the Notes containing the
information set forth in Section 4.17 of the Indenture.

     (b) When the aggregate amount of Excess Proceeds from one or more Asset
Sales exceeds $10.0 million, the Company shall make an offer to all Holders of
Notes (and holders of other Indebtedness of the Company to the extent required
by the terms of such other Indebtedness) (an "Asset Sale Offer") to purchase the
maximum principal amount of Notes (and other such Indebtedness) that does not
exceed the Excess Proceeds at an offer price in cash in an amount equal to 100%
of the principal amount thereof, plus accrued and unpaid interest and Liquidated
Damages, if any, thereon to the date of purchase, in accordance with the
procedures set forth in the Indenture. To the extent that the aggregate
principal amount of Notes (and such other Indebtedness) tendered pursuant to an
Asset Sale Offer is less than the Excess Proceeds, the Company may use any
remaining Excess Proceeds for general corporate purposes. If the aggregate
principal amount of Notes (and such other Indebtedness) tendered exceeds the
amount of Excess Proceeds, the Notes (and such other Indebtedness) to be
purchased shall be selected on a pro rata basis.

9.       Denominations, Transfer, Exchange.

     The Notes are in registered form without coupons in denominations of $1,000
and integral multiples of $1,000. The transfer of Notes may be registered and
Notes may be exchanged as provided in the Indenture. The Registrar and the
Trustee may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and the Company may require a Holder to pay
any taxes and fees required by law or permitted by the Indenture. The Company
need not exchange or register the transfer of any Note or portion of a Note
selected for redemption, except for the unredeemed portion of any Note being
redeemed in



                                     -104-


part. Also, the Company need not exchange or register the transfer of any Notes
for a period of 15 days before the day of any selection of Notes to be redeemed
or during the period between a record date and the corresponding Interest
Payment Date.

10.      Persons Deemed Owners.

     The registered Holder of a Note may be treated as its owner for all
purposes.

11.      Amendment, Supplement And Waiver.

     Subject to certain exceptions, the Indenture or the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in principal
amount of the then outstanding Notes, and any existing default or compliance
with any provision of the Indenture or the Notes may be waived with the consent
of the Holders of a majority in principal amount of the then outstanding Notes.
Without the consent of any Holder of a Note, the Indenture or the Notes may be
amended or supplemented to cure any ambiguity, defect or inconsistency, to
provide for uncertificated Notes in addition to or in place of certificated
Notes, to provide for the assumption of the Company's or any Guarantor's
obligations to Holders of the Notes in case of a merger, consolidation or sale
of assets, to provide security for the Notes, to add a Guarantor, to make any
change that would provide any additional rights or benefits to the Holders of
the Notes or that does not adversely affect the legal rights under the Indenture
of any such Holder in any material respect, or to comply with the requirements
of the SEC in order to effect or maintain the qualification of the Indenture
under the Trust Indenture Act.

12.      Events of Default And Remedies.

     Events of Default include: (i) default for 30 days in the payment when due
of interest on, or Liquidated Damages, if any, with respect to, the Notes
(whether or not prohibited by Article 10 of the Indenture); (ii) default in
payment when due (whether payable at maturity, upon redemption or repurchase or
otherwise) of principal of or premium, if any, on the Notes (whether or not
prohibited by Article 10 of the Indenture); (iii) failure by the Company or its
Restricted Subsidiaries to comply with the provisions of Article 5 of the
Indenture; (iv) failure by the Company to comply with Sections 3.10, 4.16 or
4.17 of the Indenture (whether or not prohibited by Article 10 of the
Indenture), other than a failure to purchase Notes pursuant to an offer
commenced under such provisions, which shall be subject to clause (ii) above,
for 30 days after written notice by the Trustee or the Holders of at least 25%
in principal amount of the then outstanding Notes; (v) failure by the Company or
any of its Restricted Subsidiaries for 60 days after written notice by the
Trustee or the Holders of at least 25% in principal amount of the then
outstanding Notes to comply with any of its other agreements in the Indenture or
the Notes other than those referred to in clauses (i) through (iv) above; (vi)
default under any mortgage, indenture or instrument under which there may be
issued or by which there may be secured or evidenced any Indebtedness for money
borrowed by the Company or any of its Significant Subsidiaries (or the payment
of which is guaranteed by the Company or any of its Significant Subsidiaries),
whether such Indebtedness or guarantee now exists, or is created after the
Closing Date, which default (a) is caused by a failure to pay principal after
final maturity of such Indebtedness prior to the expiration of the grace period
provided in such Indebtedness on the date of such default (a "Payment Default")
or (b) results in the acceleration of such Indebtedness prior to its express
maturity and, in each case, the principal amount of any such



                                     -105-


Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or the maturity of which has been
so accelerated, aggregates $10 million or more without such Indebtedness being
discharged or such acceleration having been cured, waived or rescinded within 30
days of acceleration; (vii) failure by the Company or any of its Significant
Subsidiaries to pay final judgments aggregating in excess of $10.0 million and
either (a) any creditor commences enforcement proceedings upon any such judgment
or (b) such judgments are not paid, discharged or stayed for a period of 60
days; (viii) except as permitted by the Indenture, any Guarantee of the Notes by
a Significant Subsidiary shall be held in any judicial proceeding to be
unenforceable or invalid or shall cease for any other reason to be in full force
and effect, or any Guarantor which is a Significant Subsidiary, or any Person
acting on behalf of any such Guarantor, shall deny or disaffirm its obligations
under its Subsidiary Guarantee; and (ix) certain events of bankruptcy or
insolvency with respect to the Company or any of its Restricted Subsidiaries
that is a Significant Subsidiary. If any Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount of
the then outstanding Notes may declare all the Notes and all other Obligations
thereunder to be due and payable by notice in writing to the Company and the
Trustee. Notwithstanding the foregoing, in the case of an Event of Default
arising from certain events of bankruptcy or insolvency, with respect to the
Company, all outstanding Notes will become due and payable without further
action or notice. Holders may not enforce the Indenture or the Notes except as
provided in the Indenture. Subject to certain limitations, Holders of a majority
in principal amount of the then outstanding Notes may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders of the
Notes notice of any continuing Default or Event of Default (except a Default or
Event of Default relating to the payment of principal, premium, if any, interest
or Liquidated Damages, if any) if it determines that withholding notice is in
their interest. The Holders of a majority in aggregate principal amount of the
Notes then outstanding by notice to the Trustee may on behalf of the Holders of
all of the Notes waive any existing Default or Event of Default and its
consequences under the Indenture except a continuing Default or Event of Default
in the payment of principal of, premium and Liquidated Damages, if any, or
interest on the Notes.

13.      Subordination.

     Each Holder by accepting a Note agrees that the payment (by set-off,
redemption, repurchase or otherwise) of principal of, and premium, if any, and
interest and Liquidated Damages, if any, on, the Notes (including with respect
to any repurchases of the Notes) is subordinated in right of payment, to the
extent and in the manner provided in Article 10 of the Indenture, to the prior
payment in full in cash, or, at the option of holders of Senior Debt of the
Company, in Cash Equivalents, of all Obligations in respect of Senior Debt of
the Company, whether outstanding on the date of the Indenture or thereafter
incurred.

14.       Subsidiary Guarantees.

     Pursuant to the Indenture, payment of the Notes is guaranteed, jointly and
severally, on a senior subordinated basis by GHTV, Inc., a Delaware corporation,
Gillett Broadcasting, Inc., a Delaware corporation, Vail Holdings, Inc., a
Colorado corporation, The Vail Corporation, a Colorado corporation, Beaver Creek
Associates, Inc., a Colorado corporation, Beaver Creek Consultants, Inc., a
Colorado corporation, Breckenridge Resort Properties, Inc., a Colorado
corporation, Complete Telecommunications, Inc., a Colorado corporation, Grand
Teton Lodge



                                     -106-


Company, a Wyoming corporation, Jackson Hole Golf and Tennis Club, Inc., a
Wyoming corporation, JHL&S LLC, a Wyoming limited liability company, Larkspur
Restaurant & Bar, LLC, a Colorado limited liability company, Lodge Properties,
Inc., a Colorado corporation, Vail Food Services, Inc., a Colorado corporation,
Vail Resorts Development Company, a Colorado corporation, Vail Summit Resorts,
Inc., a Colorado corporation, Vail Trademarks, Inc., a Colorado corporation,
Vail/Arrowhead, Inc., a Colorado corporation, Vail/Beaver Creek Resort
Properties, Inc., a Colorado corporation, Beaver Creek Food Services, Inc., a
Colorado corporation, Lodge Realty, Inc., a Colorado corporation, Vail
Associates Consultants, Inc., a Colorado corporation, Vail Associates Holdings,
Ltd., a Colorado corporation, Vail Associates Management Company, a Colorado
corporation, Vail Associates Real Estate, Inc., a Colorado corporation,
Vail/Battle Mountain, Inc., a Colorado corporation, Keystone Conference
Services, Inc., a Colorado corporation, Keystone Development Sales, Inc., a
Colorado corporation, Keystone Food and Beverage Company, a Colorado
corporation, Keystone Resort Property Management Company, a Colorado
corporation, Property Management Acquisition Corp., Inc., a Tennessee
corporation, The Village at Breckenridge Acquisition Corp., Inc., a Tennessee
corporation, Teton Hospitality, LLC, a Wyoming limited liability company, Teton
Hospitality Services, Inc., a Wyoming corporation, VAHMC, Inc., a Colorado
corporation, Vail RR, Inc., a Colorado corporation, VA Rancho Mirage I, Inc., a
Colorado corporation, VA Rancho Mirage II, Inc., a Colorado corporation, and,
under certain circumstances set forth in the Indenture, may be guaranteed by
certain other Restricted Subsidiaries of the Company. Under certain
circumstances set forth in the Indenture, each of the Guarantors may be released
from its obligations under the Indenture and the Notes.

15.      Trustee Dealings With Company.

     The Trustee, in its individual or any other capacity, may make loans to,
accept deposits from, and perform services for the Company, any Guarantor or any
Affiliate of the Company, and may otherwise deal with the Company, any Guarantor
or any Affiliate of the Company, as if it were not the Trustee.

16.      No Recourse Against Others.

     No director, officer, employee, incorporator or stockholder, of the Company
or any Guarantor, as such, shall have any liability for any obligations of the
Company or such Guarantor under the Notes or the Indenture or for any claim
based on, in respect of, or by reason of, such obligations or their creation.
Each Holder by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for the issuance of the Notes.

17.      Authentication.

     This Note shall not be valid until authenticated by the manual signature of
the Trustee or an authenticating agent.

18.      Abbreviations.

     Customary abbreviations may be used in the name of a Holder or an assignee,
such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties),
JT TEN (= joint



                                     -107-


tenants with right of survivorship and not as tenants in common), CUST (=
Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

19.  Additional Rights of Holders of Restricted Global Notes and Restricted
     Definitive Notes.

     In addition to the rights provided to Holders of Notes under the Indenture,
Holders of Restricted Global Notes and Restricted Definitive Notes shall have
all the rights set forth in the Registration Rights Agreement dated as of
November 21, 2001 (the "Registration Rights Agreement"), among the Company, the
Guarantors and the Initial Purchasers.

20.      Governing Law.

     THE INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED ENTIRELY WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICT OF LAWS.

21.      CUSIP Numbers.

     Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused CUSIP numbers to be
printed on the Notes and the Trustee may use CUSIP numbers in notices of
redemption as a convenience to Holders. No representation is made as to the
accuracy of such numbers either as printed on the Notes or as contained in any
notice of redemption and reliance may be placed only on the other identification
numbers placed thereon.

     The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:

VAIL RESORTS, INC.
137 Benchmark Road
Avon, Colorado 81620
Attention:   James P. Donohue
             Chief Financial Officer



                                     -108-


                                ASSIGNMENT FORM

     To assign this Note, fill in the form below:

(I) or (we) assign and transfer this Note to:___________________________________
                                               (Insert assignee's legal name)

                 (Insert assignee's soc. sec. or tax I.D. no.)





             (Print or type assignee's name, address and zip code)


and irrevocably appoint_________________________________________________________
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.

Date:______________________

                                      Your Signature:___________________________
                                      (Sign exactly as your name appears on the
                                       face of this Note)

Signature Guarantee*:_________

* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).



                                     -109-


                       OPTION OF HOLDER TO ELECT PURCHASE

     If you want to elect to have this Note purchased by the Company pursuant to
Section 4.16 or 4.17 of the Indenture, check the appropriate box below:

                 / / Section 4.16     / / Section 4.17

     If you want to elect to have only part of the Note purchased by the Company
pursuant to Section 4.16 or Section 4.17 of the Indenture, state the amount you
elect to have purchased:

                                     $___________________

Date:____________

                                      Your Signature:___________________________
                                      (Sign exactly as your name appears on the
                                       face of this Note)


                                       Tax Identification No.:__________________

Signature Guarantee*:________

* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).





                                     -110-


             SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE

     The following exchanges of a part of this Global Note for an interest in
another Global Note or for a Definitive Note, or exchanges of a part of another
Global Note or Definitive Note for an interest in this Global Note, have been
made:

Principal Amount Signature of Amount of decrease in Amount of increase in of this Global Note authorized signatory Principal Amount Principal Amount following such of Trustee or Date of Exchange of this Global Note of this Global Note decrease (or increase) Note Custodian - ---------------- ------------------- ------------------- ---------------------- --------------
-111- EXHIBIT B FORM OF CERTIFICATE OF TRANSFER VAIL RESORTS, INC. 137 Benchmark Road Avon, Colorado 81620 Attention: James P. Donohue THE BANK OF NEW YORK c/o United States Trust Company of New York 114 West 47th Street New York, New York 10036 Attention: Corporate Trust Department ss Re: 8 3/4% Senior Subordinated Notes due 2009 Reference is hereby made to the Indenture, dated as of November 21, 2001 (the "Indenture"), among VAIL RESORTS, INC., as issuer (the "Company"), the Guarantors named on the signature pages thereto and THE BANK OF NEW YORK, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. ___________________ (the "Transferor") owns and proposes to transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in the principal amount of $___________ in such Note[s] or interests (the "Transfer"), to ___________________________ (the "Transferee"), as further specified in Annex A hereto. In connection with the Transfer, the Transferor hereby certifies that: [CHECK ALL THAT APPLY] 1. : Check if Transferee will take delivery of a beneficial interest in the 144A Global Note or a Definitive Note Pursuant to Rule 144A. The Transfer is being effected pursuant to and in accordance with Rule 144A under the United States Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, the Transferor hereby further certifies that the beneficial interest or Definitive Note is being transferred to a Person that the Transferor reasonably believed and believes is purchasing the beneficial interest or Definitive Note for its own account, or for one or more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a "qualified institutional buyer" within the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and such Transfer is in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the 144A Global Note and/or the Definitive Note and in the Indenture and the Securities Act. 2. : Check if Transferee will take delivery of a beneficial interest in the Regulation S Global Note or a Definitive Note pursuant to Regulation S. The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor hereby further certifies that (i) the Transfer is not being made to a -112- person in the United States and (x) at the time the buy order was originated, the Transferee was outside the United States or such Transferor and any Person acting on its behalf reasonably believed and believes that the Transferee was outside the United States or (y) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither such Transferor nor any Person acting on its behalf knows that the transaction was prearranged with a buyer in the United States, (ii) no directed selling efforts have been made in contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S under the Securities Act, (iii) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act and (iv) if the proposed transfer is being made prior to the expiration of the Restricted Period, the transfer is not being made to a U.S. Person or for the account or benefit of a U.S. Person (other than an Initial Purchaser). Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Regulation S Global Note, the Temporary Regulation S Global Note and/or the Definitive Note and in the Indenture and the Securities Act. 3. : Check and complete if Transferee will take delivery of a beneficial interest in the IAI Global Note or a Definitive Note pursuant to any provision of the Securities Act other than Rule 144A or Regulation S. The Transfer is being effected in compliance with the transfer restrictions applicable to beneficial interests in Restricted Global Notes and Restricted Definitive Notes and pursuant to and in accordance with the Securities Act and any applicable blue sky securities laws of any state of the United States, and accordingly the Transferor hereby further certifies that (check one): (a) : such Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act; or (b) : such Transfer is being effected to the Company or a subsidiary thereof; or (c) : such Transfer is being effected pursuant to an effective registration statement under the Securities Act and in compliance with the prospectus delivery requirements of the Securities Act; or (d) : such Transfer is being effected to an Institutional Accredited Investor and pursuant to an exemption from the registration requirements of the Securities Act other than Rule 144A, Rule 144 or Rule 904, and the Transferor hereby further certifies that it has not engaged in any general solicitation within the meaning of Regulation D under the Securities Act and the Transfer complies with the transfer restrictions applicable to beneficial interests in a Restricted Global Note or Restricted Definitive Notes and the requirements of the exemption claimed, which certification is supported by (1) a certificate executed by the Transferee in the form of Exhibit D to the Indenture and (2) an Opinion of Counsel provided by the Transferor or the Transferee (a -113- copy of which the Transferor has attached to this certification), to the effect that such Transfer is in compliance with the Securities Act. Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the IAI Global Note and/or Definitive Notes and in the Indenture and the Securities Act. 4. : Check if Transferee will take delivery of a beneficial interest in an Unrestricted Global Note or of an Unrestricted Definitive Note. (a) : Check if Transfer is pursuant to Rule 144. (i) The Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture. (b) : Check if Transfer is Pursuant to Regulation S. (i) The Transfer is being effected pursuant to and in accordance with Rule 904 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture. (c) : Check if Transfer is Pursuant to Other Exemption. (i) The Transfer is being effected pursuant to and in compliance with an exemption from the registration requirements of the Securities Act other than Rule 144 or Rule 904 and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any State of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will not be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes or Restricted Definitive Notes and in the Indenture. -114- This certificate and the statements contained herein are made for your benefit and the benefit of the Company. [Insert Name of Transferor] By:____________________________________ Name: Title: Dated:______________________________ -115- ANNEX A TO CERTIFICATE OF TRANSFER 1. The Transferor owns and proposes to transfer the following: [CHECK ONE OF (a) OR (b)] (a) : a beneficial interest in the: (i) : 144A Global Note (CUSIP 91879Q AD 1); or (ii) : Regulation S Global Note (CUSIP U90984 AB 8); or (iii) : IAI Global Note (CUSIP ____________); or (b) : a Restricted Definitive Note. 2. After the Transfer the Transferee will hold: [CHECK ONE] (a) : a beneficial interest in the: (i) : 144A Global Note (CUSIP __________); or (ii) : Regulation S Global Note (CUSIP __________); or (iii) : IAI Global Note (CUSIP ____________); or (iv) : Unrestricted Global Note (CUSIP ); or (b) : a Restricted Definitive Note; or (c) : an Unrestricted Definitive Note, in accordance with the terms of the Indenture. -116- EXHIBIT C FORM OF CERTIFICATE OF EXCHANGE VAIL RESORTS, INC. 137 Benchmark Road Avon, Colorado 81620 Attention: James P. Donohue THE BANK OF NEW YORK c/o United States Trust Company of New York 114 West 47th Street New York, New York 10036 Attention: Corporate Trust Department Re: 8 3/4% Senior Subordinated Notes due 2009 (CUSIP ____________) Reference is hereby made to the Indenture, dated as of November 21, 2001 (the "Indenture"), among VAIL RESORTS, INC., as issuer (the "Company"), the Guarantors named on the signature pages thereto and THE BANK OF NEW YORK, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. __________________________ (the "Owner") owns and proposes to exchange the Note[s] or interest in such Note[s] specified herein, in the principal amount of $____________ in such Note[s] or interests (the "Exchange"). In connection with the Exchange, the Owner hereby certifies that: 1. Exchange of Restricted Definitive Notes or Beneficial Interests in a Restricted Global Note for Unrestricted Definitive Notes or Beneficial Interests in an Unrestricted Global Note (a) : Check if Exchange is from beneficial interest in a Restricted Global Note to beneficial interest in an Unrestricted Global Note. In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Note for a beneficial interest in an Unrestricted Global Note in an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Global Notes and pursuant to and in accordance with the United States Securities Act of 1933, as amended (the "Securities Act"), (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest in an Unrestricted Global Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. (b) : Check if Exchange is from beneficial interest in a Restricted Global Note to Unrestricted Definitive Note. In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Definitive Note is being acquired for the Owner's own account without -117- transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. (c) : Check if Exchange is from Restricted Definitive Note to beneficial interest in an Unrestricted Global Note. In connection with the Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. (d) : Check if Exchange is from Restricted Definitive Note to Unrestricted Definitive Note. In connection with the Owner's Exchange of a Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. 2. Exchange of Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes for Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes (a) : Check if Exchange is from beneficial interest in a Restricted Global Note to Restricted Definitive Note. In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Note for a Restricted Definitive Note with an equal principal amount, the Owner hereby certifies that the Restricted Definitive Note is being acquired for the Owner's own account without transfer. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the Restricted Definitive Note issued will continue to be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Definitive Note and in the Indenture and the Securities Act. (b) : Check if Exchange is from Restricted Definitive Note to beneficial interest in a Restricted Global Note. In connection with the Exchange of the Owner's Restricted Definitive Note for a beneficial interest in the [CHECK ONE] :144A Global Note, :Regulation S Global Note, : IAI Global Note with an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer and (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the -118- Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, and in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the beneficial interest issued will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the relevant Restricted Global Note and in the Indenture and the Securities Act. This certificate and the statements contained herein are made for your benefit and the benefit of the Company. [Insert Name of Transferor] By:_________________________________ Name: Title: Dated:_________________________ -119- EXHIBIT D FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR VAIL RESORTS, INC. 137 Benchmark Road Avon, Colorado 81620 Attention: James P. Donohue THE BANK OF NEW YORK c/o United States Trust Company of New York 114 West 47th Street New York, New York 10036 Attention: Corporate Trust Department Re: 8 3/4% Senior Subordinated Notes due 2009 Reference is hereby made to the Indenture, dated as of November 21, 2001 (the "Indenture"), among VAIL RESORTS, INC., as issuer (the "Company"), the Guarantors named on the signature pages thereto and THE BANK OF NEW YORK, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. In connection with our proposed purchase of $____________ aggregate principal amount of: (a) : a beneficial interest in a Global Note, or (b) : a Definitive Note, we confirm that: 1. We understand that the Notes have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), and may not be sold except as permitted in the following sentence. We agree on our own behalf and on behalf of any investor account for which we are purchasing the Notes to offer, sell or otherwise transfer such Notes prior to the date which is two years after the later of the date of original issue and the last date on which the Company or any affiliate of the Company was the owner of such Notes, or any predecessor thereto (the "Resale Restriction Termination Date") only (a) to the Company, (b) pursuant to a registration statement which has been declared effective under the Securities Act, (c) for so long as the Notes are eligible for resale pursuant to Rule 144A under the Securities Act, to a person we reasonably believe is a qualified institutional buyer under Rule 144A (a "QIB") that purchases for its own account or for the account of a QIB to whom notice is given that the transfer is being made in reliance on Rule 144A, (d) pursuant to offers and sales to non-U.S. Persons that occur outside the United States within the meaning of Regulations S under the Securities Act, (e) to an institutional "accredited investor" within the meaning of subparagraph (a)(1), (2), (3) or (7) of Rule 501 under the Securities Act that is acquiring the Notes for its own account or for the account of such an institutional "accredited investor" for investment purposes and not with a view to, or for offer or sale in connection with, -120- any distribution thereof in violation of the Securities Act or (f) pursuant to any other available exemption from the registration requirements of the Securities Act, subject in each of the foregoing cases to any requirement of law that the disposition of our property and the property of such investor account or accounts be at all times within our or their control and to compliance with any applicable state securities laws. The foregoing restrictions on resale will not apply subsequent to the Resale Restriction Termination Date. If any resale or other transfer of the Notes is proposed to be made pursuant to clause (e) above prior to the Resale Restriction Termination Date, the transferor shall deliver a letter from the transferee substantially in the form of this letter to the Trustee, which shall provide, among other things, that the transferee is an institutional "accredited investor" within the meaning of subparagraph (a)(1), (2), (3) or (7) or Rule 501 under the Securities Act and that it is acquiring such Notes for investment purposes and not for distribution in violation of the Securities Act. We acknowledge that the Company and the Trustee reserve the right prior to any offer, sale or other transfer prior to the Resale Restriction Termination Date of the Notes pursuant to clauses (d), (e) and (f) above to require the delivery of an Opinion of Counsel, certifications and/or other information satisfactory to the Company and the Trustee. 2. We are an institutional "accredited investor" (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) purchasing for our own account or for the account of such an institutional "accredited investor", and we are acquiring the Notes for investment purposes and not with a view to, or for offer or sale in connection with, any distribution in violation of the Securities Act and we have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of our investment in the Notes, and we and any accounts for which we are acting are each able to bear the economic risk of our or its investment. 3. We are acquiring the Notes or beneficial interest therein purchased by us for our own account or for one or more accounts (each of which is an institutional "accredited investor") as to each of which we exercise sole investment discretion. You and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. [Insert Name of Accredited Investor] By:________________________________ Name: Title: Dated:__________________________ -121-
                                                                     Exhibit 4.3


                                                    FIRST SUPPLEMENTAL INDENTURE
                                                               TO 2001 INDENTURE





                              --------------------

                          FIRST SUPPLEMENTAL INDENTURE

                          Dated as of January 16, 2002

                                       to

                                    INDENTURE

                          Dated as of November 21, 2001

                                      among

                         VAIL RESORTS, INC., as Issuer,

                  the Guarantors named therein, as Guarantors,

                                       and

                        THE BANK OF NEW YORK, as Trustee

                              --------------------

                               up to $300,000,000

                   8 3/4 % Senior Subordinated Notes due 2009






                                                    FIRST SUPPLEMENTAL INDENTURE
                                                               TO 2001 INDENTURE




     FIRST SUPPLEMENTAL INDENTURE, dated as of January 16, 2002, among Vail
Resorts, Inc., a Delaware corporation (the "Issuer"), the Guarantors named on
the signature pages hereto (the "Guarantors"), the Additional Guarantors named
on the signature pages hereto (collectively the "Additional Guarantors"), and
The Bank of New York, as Trustee (the "Trustee").

     WHEREAS, the Issuer and the Guarantors have heretofore executed and
delivered to the Trustee an Indenture dated as of November 21, 2001 (the
"Indenture"), providing for the issuance of up to $300,000,000 aggregate
principal amount of 8 3/4% Senior Subordinated Notes due 2009 of the Company
(the "Notes"); and

     WHEREAS, subsequent to the execution of the Indenture and the issuance of
$160,000,000 aggregate principal amount of the Notes, each of the Additional
Guarantors have become guarantors under the Credit Agreement; and

     WHEREAS, pursuant to and as contemplated by Section 4.18 and 9.01 of the
Indenture, the parties hereto desire to execute and deliver this First
Supplemental Indenture for the purpose of providing for the Additional
Guarantors to expressly assume all the obligations of a Guarantor under the
Notes and the Indenture;

     NOW, THEREFORE, in consideration of the above premises, each party agrees,
for the benefit of the other and for the equal and ratable benefit of the
Holders of the Notes, as follows:


                                       I.

                            ASSUMPTION OF GUARANTEES


     The Additional Guarantors, as provided by Section 4.18 of the Indenture,
jointly and severally, hereby unconditionally expressly assume all of the
obligations of a Guarantor under the Notes and the Indenture to the fullest as
set forth in Article 12 of the Indenture; and the Additional Guarantors may
expressly exercise every right and power of a Guarantor under the Indenture with
the same effect as if they had been named Guarantors therein.


                                       II.

                            MISCELLANEOUS PROVISIONS


                  A.       Terms Defined.
                           -------------

     For all purposes of this First Supplemental Indenture, except as otherwise
defined or unless the context otherwise requires, terms used in capitalized form
in this First Supplemental Indenture and defined in the Indenture have the
meanings specified in the Indenture.



                                                    FIRST SUPPLEMENTAL INDENTURE
                                                               TO 2001 INDENTURE


                  B.       Indenture.
                           ---------

     Except as amended hereby, the Indenture and the Notes are in all respects
ratified and confirmed and all the terms shall remain in full force and effect.

                  C.       Governing Law.
                           -------------

     THIS FIRST SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED ENTIRELY WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICT OF LAWS.

                  D.       Successors.
                           ----------

     All agreements of the Company, the Guarantors and the Additional Guarantors
in this First Supplemental Indenture, the Notes and the Guarantees shall bind
their respective successors. All agreements of the Trustee in this First
Supplemental Indenture shall bind its successors.

                  E.       Duplicate Originals.
                           -------------------

     The parties may sign any number of copies of this First Supplemental
Indenture. Each signed copy shall be an original, but all of them together shall
represent the same agreement.


                                      -2-

                                                    FIRST SUPPLEMENTAL INDENTURE
                                                               TO 2001 INDENTURE


                                   SIGNATURES

     IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental
Indenture to be duly executed, all as of the date first written above.

                             Issuer:
                                      VAIL RESORTS, INC.



                             By:    /s/ Martha Dugan Rehm
                                    --------------------------------------------
                                    Name:     MARTHA DUGAN REHM
                                    Title:    Senior Vice President



                                      -3-

                                                    FIRST SUPPLEMENTAL INDENTURE
                                                               TO 2001 INDENTURE


                            GUARANTORS:

                            GHTV, INC.
                            GILLETT BROADCASTING, INC.
                            VAIL HOLDINGS, INC.
                            THE VAIL CORPORATION
                            BEAVER CREEK ASSOCIATES, INC.
                            BEAVER CREEK CONSULTANTS, INC.
                            LODGE PROPERTIES, INC.
                            VAIL FOOD SERVICES, INC.
                            VAIL RESORTS DEVELOPMENT COMPANY
                            VAIL SUMMIT RESORTS, INC.
                            VAIL TRADEMARKS, INC.
                            VAIL/ARROWHEAD, INC.
                            VAIL/BEAVER CREEK RESORT PROPERTIES, INC.
                            BEAVER CREEK FOOD SERVICES, INC.
                            LODGE REALTY, INC.
                            VAIL ASSOCIATES CONSULTANTS, INC.
                            VAIL ASSOCIATES HOLDINGS, LTD.
                            VAIL ASSOCIATES MANAGEMENT COMPANY
                            VAIL ASSOCIATES REAL ESTATE, INC.
                            VAIL/BATTLE MOUNTAIN, INC.
                            KEYSTONE CONFERENCE SERVICES, INC.
                            KEYSTONE DEVELOPMENT SALES, INC.
                            KEYSTONE FOOD AND BEVERAGE COMPANY
                            KEYSTONE RESORT PROPERTY MANAGEMENT COMPANY
                            PROPERTY MANAGEMENT ACQUISITION CORP., INC.
                            THE VILLAGE AT BRECKENRIDGE ACQUISITION CORP., INC.
                            GRAND TETON LODGE COMPANY
                            LARKSPUR RESTAURANT & BAR, LLC
                            BRECKENRIDGE RESORT PROPERTIES, INC.
                            COMPLETE TELECOMMUNICATIONS, INC. (F/K/A VR
                              TELECOMMUNICATIONS, INC.)
                            JACKSON HOLE GOLF AND TENNIS CLUB, INC.
                            TETON HOSPITALITY SERVICES, INC.
                            VAIL RR, INC.
                            VA RANCHO MIRAGE I, INC.
                            VA RANCHO MIRAGE II, INC.
                            VAMHC, INC.

                            Each by its authorized officer:


                            By:    /s/ Martha Dugan Rehm
                                   --------------------------------------
                                   Name:     Martha Dugan Rehm
                                   Title:    Senior Vice President


                                      -4-

                                                    FIRST SUPPLEMENTAL INDENTURE
                                                               TO 2001 INDENTURE


                            GUARANTORS (CONTINUED):


                            TETON HOSPITALITY, LLC
                            BY: Teton Hospitality Services, Inc.,
                                its Sole Member



                            By:    /s/ Martha Dugan Rehm
                                   ---------------------------------------------
                                   Name:     Martha Dugan Rehm
                                   Title:    Vice President

                            JHL&S, LLC


                            By:    /s/ Martha Dugan Rehm
                                   ---------------------------------------------
                                   Name:     Martha Dugan Rehm
                                   Title:    Authorized Signatory





                                      -5-

                                                    FIRST SUPPLEMENTAL INDENTURE
                                                               TO 2001 INDENTURE


                            ADDITIONAL GUARANTORS:

                            ROCKRESORTS INTERNATIONAL, LLC
                            ROCKRESORTS LLC
                            ROCKRESORTS CASA MADRONA, LLC
                            ROCKRESORTS CHEECA, LLC
                            ROCKRESORTS EQUINOX, INC.
                            ROCKRESORTS LAPOSADA, LLC
                            ROCKRESORTS ROSARIO, LLC

                            Each by its authorized officer:


                            By:    /s/ Martha Dugan Rehm
                                   ---------------------------------------------
                                   Name:     Martha Dugan Rehm
                                   Title:    Senior Vice President

                            VA RANCHO MIRAGE RESORT, L.P.
                            By: VA RANCHO MIRAGE I, INC.,
                            Its general partner


                            By:    /s/ Martha Dugan Rehm
                                   ---------------------------------------------
                                   Name:     Martha Dugan Rehm
                                   Title:    Senior Vice President





                                      -6-

                                                    FIRST SUPPLEMENTAL INDENTURE
                                                               TO 2001 INDENTURE


                            TRUSTEE:

                            THE BANK OF NEW YORK
                            as Trustee


                            By:    /s/ Cynthia Chaney
                                   --------------------------------------------
                                   Name:   Cynthia Chaney
                                   Title:






                                      -7-

                                                                     Exhibit 4.5

                                                                  EXECUTION COPY










                          REGISTRATION RIGHTS AGREEMENT

                                  by and among

                               Vail Resorts, Inc.,
                           The Guarantors Named on the
                             Signature Pages Hereto


                                       and


                         Deutsche Banc Alex. Brown Inc.
                         Banc of America Securities LLC
                            Bear, Stearns & Co. Inc.
                            CIBC World Markets Corp.
                             Fleet Securities, Inc.



                          Dated as of November 21, 2001






     This Registration Rights Agreement (this "Agreement") is made and entered
into as of November 21, 2001, by and among Vail Resorts, Inc., a Delaware
corporation (the "Issuer") and the Guarantors named on the Signature Pages
hereto (each a "Guarantor" and collectively, the "Guarantors"), on the one hand,
and the initial purchasers named on the Signature Pages hereto (each, an
"Initial Purchaser" and collectively, the "Initial Purchasers"), on the other
hand, who have each agreed to purchase a specified number of the Issuer's 8 3/4%
Senior Subordinated Notes due 2009 (the "Restricted Notes") pursuant to the
Purchase Agreement (as defined below).

     This Agreement is made pursuant to the Purchase Agreement, dated as of
November 16, 2001 (the "Purchase Agreement"), by and among the Issuer, the
Guarantors and the Initial Purchasers (i) for the benefit of the Issuer, the
Guarantors and the Initial Purchasers and (ii) for the benefit of the holders
from time to time of the Notes (including the Initial Purchasers). In order to
induce the Initial Purchasers to purchase the Restricted Notes, the Issuer and
the Guarantors have agreed to provide the registration rights set forth in this
Agreement. The execution and delivery of this Agreement is a condition to the
obligations of the Initial Purchasers set forth in Section 8 of the Purchase
Agreement. Capitalized terms used herein and not otherwise defined shall have
the meaning assigned to them in the Indenture, dated November 21, 2001, between
the Company, the Guarantors and United States Trust Company of New York, as
Trustee, relating to the Restricted Notes and the Exchange Notes (the
"Indenture").

     The parties hereby agree as follows:


                             SECTION 1. DEFINITIONS

     As used in this Agreement, the following capitalized terms shall have the
following meanings:

     Advice: As defined in Section 6 hereof.

     Broker-Dealer: Any broker or dealer registered under the Exchange Act.

     Broker-Dealer Transfer Restricted Securities: Exchange Notes that are
acquired by a Broker-Dealer in the Exchange Offer in exchange for Restricted
Notes that such Broker-Dealer acquired for its own account as a result of market
making activities or other trading activities (other than Restricted Notes
acquired directly from the Issuer or any of its affiliates).

     Closing Date: The date of this Agreement.

     Commission: The Securities and Exchange Commission.

     Consummate: An Exchange Offer shall be deemed "Consummated" for purposes of
this Agreement upon the occurrence of (i) the filing and effectiveness under the
Securities Act of the Exchange Offer Registration Statement relating to the
Exchange Notes to be issued in the Exchange Offer, (ii) the maintenance of such
Registration Statement continuously effective and the keeping of the Exchange
Offer open for a period not less than the minimum period required pursuant to
Section 3(b) hereof, and (iii) the delivery by the Issuer to the Registrar under
the



                                      -1-


Indenture of Exchange Notes in the same aggregate principal amount at maturity
as the aggregate principal amount at maturity of Restricted Notes that were
tendered by Holders thereof pursuant to the Exchange Offer.

     Effectiveness Target Date: As defined in Section 5.

     Exchange Act: The Securities Exchange Act of 1934, as amended.

     Exchange Notes: The 8 3/4% Senior Subordinated Notes due 2009, of the same
class under the Indenture as the Restricted Notes, to be issued to Holders in
exchange for Transfer Restricted Securities pursuant to this Agreement.

     Exchange Offer: The registration by the Issuer under the Securities Act of
the Exchange Notes pursuant to a Registration Statement pursuant to which the
Issuer offers the Holders of all outstanding Transfer Restricted Securities the
opportunity to exchange all such outstanding Transfer Restricted Securities held
by such Holders for Exchange Notes in an aggregate principal amount at maturity
equal to the aggregate principal amount at maturity of the Transfer Restricted
Securities tendered in such exchange offer by such Holders.

     Exchange Offer Registration Statement: The Registration Statement relating
to the Exchange Offer, including the related Prospectus.

     Exempt Resales: The transactions in which an Initial Purchaser proposes to
sell the Restricted Notes to certain "qualified institutional buyers," as such
term is defined in Rule 144A under the Securities Act and to certain non-U.S.
persons outside the United States within the meaning of Regulation S under the
Securities Act.

     Guarantor: As defined in the preamble hereto.

     Holder: As defined in Section 2(b) hereof.

     Indemnified Holder: As defined in Section 8(a) hereof.

     Indenture: As defined in the preamble hereto.

     Initial Purchaser(s): As defined in the preamble hereto.

     Initial Placement: The issuance and sale by the Issuer of the Restricted
Notes to the Initial Purchasers pursuant to the Purchase Agreement.

     Inspectors: As defined in Section 6(c)(vi).

     Interest Payment Date: As defined in the Notes.

     Issuer: As defined in the preamble hereto.

     Liquidated Damages: As defined in Section 5(a) hereof.



                                      -2-


     NASD: National Association of Securities Dealers, Inc.

     Notes: The Restricted Notes and the Exchange Notes.

     Person: An individual, partnership, corporation, trust or unincorporated
organization, or a government or agency or political subdivision thereof.

     Prospectus: The prospectus included in a Registration Statement, as amended
or supplemented by any prospectus supplement and by all other amendments
thereto, including post-effective amendments, and all material incorporated by
reference into such Prospectus.

     Purchase Agreement: As defined in the preamble hereto.

     Registration Default: As defined in Section 5 hereof.

     Registration Statement: Any registration statement of the Issuer and the
Guarantors relating to (a) an offering of Exchange Notes pursuant to the
Exchange Offer or (b) the registration for resale of Transfer Restricted
Securities pursuant to the Shelf Registration Statement, which is filed pursuant
to the provisions of this Agreement, in each case, including the Prospectus
included therein, all amendments and supplements thereto (including
post-effective amendments) and all exhibits and material incorporated by
reference therein.

     Restricted Broker-Dealer: Any Broker-Dealer which holds Broker-Dealer
Transfer Restricted Securities.

     Restricted Notes: The 8 3/4% Senior Subordinated Notes due 2009 of the same
class under the Indenture as the Exchange Notes, for so long as such securities
constitute Transfer Restricted Securities.

     Securities Act: The Securities Act of 1933, as amended.

     Shelf Filing Deadline: As defined in Section 4(a) hereof.

     Shelf Registration Statement: As defined in Section 4(a) hereof.

     Suspension Notice: As defined in Section 6 hereof.

     TIA: The Trust Indenture Act of 1939 (15 U.S.C. Section 77aaa-77bbbb) as in
effect on the date of the Indenture.

     Transfer Restricted Securities: Each Note until (i) the date on which such
Note has been exchanged by a person other than a broker-dealer for an Exchange
Note in the Exchange Offer, (ii) following the exchange by a broker-dealer in
the Exchange Offer of a Note for an Exchange Note, the date on which such
Exchange Note is sold to a purchaser who receives from such broker-dealer on or
prior to the date of such sale a copy of the prospectus contained in the
Exchange Offer Registration Statement, (iii) the date on which such Note has
been effectively registered under the Securities Act and disposed of in
accordance with the Shelf Registration



                                      -3-


Statement or (iv) the date on which such Note may be freely transferred without
registration under the Act or is distributed to the public pursuant to Rule 144
under the Act.

     Underwritten Registration or Underwritten Offering: A registration in which
securities of the Issuer are sold to an underwriter for reoffering to the
public.

                 SECTION 2. SECURITIES SUBJECT TO THIS AGREEMENT

     (a) Transfer Restricted Securities. The securities entitled to the benefits
of this Agreement are the Transfer Restricted Securities.

     (b) Holders of Transfer Restricted Securities. On any date of
determination, any Person in whose name Transfer Restricted Securities are
registered in accordance with the Indenture is deemed to be a holder of Transfer
Restricted Securities (each, a "Holder").

                      SECTION 3. REGISTERED EXCHANGE OFFER

     (a) Unless the Exchange Offer shall not be permissible under applicable law
or Commission policy (after the procedures set forth in Section 6(a) below have
been complied with), the Issuer and the Guarantors shall (i) cause to be filed
with the Commission on or prior to 60 days after the Closing Date, a
Registration Statement under the Securities Act relating to the Exchange Notes
and the Exchange Offer, (ii) use their commercially reasonable best efforts to
cause such Registration Statement to be declared effective on or prior to 180
days after the Closing Date, (iii) in connection with the foregoing, (A) file
all pre-effective amendments to such Registration Statement as may be necessary
in order to cause such Registration Statement to be declared effective, (B) if
applicable, file a post-effective amendment to such Registration Statement
pursuant to Rule 430A under the Securities Act and (C) cause all necessary
filings in connection with the registration and qualification of the Exchange
Notes to be made under the Blue Sky laws of such jurisdictions as are necessary
to permit Consummation of the Exchange Offer and (iv) upon the effectiveness of
such Registration Statement, commence and Consummate the Exchange Offer. The
Exchange Offer shall be on the appropriate form to permit registration of the
Exchange Notes to be offered in exchange for the Transfer Restricted Securities
and sales of Broker-Dealer Transfer Restricted Securities by Restricted
Broker-Dealers as contemplated by Section 3(c) below.

     (b) The Issuer and the Guarantors shall cause the Exchange Offer
Registration Statement to be effective continuously and shall keep the Exchange
Offer open for a period of not less than the minimum period required under
applicable federal and state securities laws to Consummate the Exchange Offer.
The Issuer and the Guarantors shall cause the Exchange Offer to comply with all
applicable federal and state securities laws. No securities other than the Notes
or any additional notes issued by the issuer under the Indenture prior to the
Consummation of the Exchange Offer shall be included in the Exchange Offer
Registration Statement. The Issuer and the Guarantors shall use their respective
commercially reasonable best efforts to issue, on or prior to, 60 days after the
Exchange Offer Registration Statement is declared effective by the Commission,
Exchange Notes in exchange for all Notes tendered prior thereto in the Exchange
Offer.



                                      -4-


     (c) The Issuer shall indicate in a "Plan of Distribution" section contained
in the Prospectus forming a part of the Exchange Offer Registration Statement
that any Restricted Broker-Dealer who holds Restricted Notes that are Transfer
Restricted Securities and that were acquired for its own account as a result of
market-making activities or other trading activities (other than Transfer
Restricted Securities acquired directly from the Issuer or one of its
affiliates), may exchange such Restricted Notes pursuant to the Exchange Offer;
however, such Broker-Dealer may be deemed to be an "underwriter" within the
meaning of the Securities Act and must, therefore, deliver a prospectus meeting
the requirements of the Securities Act in connection with any resales of the
Exchange Notes received by such Broker-Dealer in the Exchange Offer, which
prospectus delivery requirement may be satisfied by the delivery by such
Broker-Dealer of the Prospectus contained in the Exchange Offer Registration
Statement. Such "Plan of Distribution" section shall also contain all other
information with respect to such resales by Restricted Broker-Dealers that the
Commission may require in order to permit such resales pursuant thereto, but
such "Plan of Distribution" shall not name any such Broker-Dealer or disclose
the amount of Notes held by any such Broker-Dealer except to the extent required
by the Commission as a result of a change in policy after the date of this
Agreement.

     (d) The Issuer and the Guarantors shall use their respective best efforts
to keep the Exchange Offer Registration Statement continuously effective,
supplemented and amended as required by the provisions of Section 6(c) below to
the extent necessary to ensure that it is available for resales of Broker-Dealer
Transfer Restricted Securities acquired by Restricted Broker-Dealers for their
own accounts as a result of market-making activities or other trading
activities, and to ensure that it conforms with the requirements of this
Agreement, the Securities Act and the policies, rules and regulations of the
Commission as announced from time to time, for a period ending on the earlier of
(i) 30 days from the date on which the Exchange Offer Registration Statement is
declared effective and (ii) the date on which a Restricted Broker-Dealer is no
longer required to deliver a prospectus in connection with market-making or
other trading activities.

     (e) The Issuer and the Guarantors shall provide sufficient copies of the
latest version of such Prospectus to Restricted Broker-Dealers promptly upon
request at any time during such 30-day (or shorter as provided in the foregoing
sentence) period in order to facilitate such resales.

                          SECTION 4. SHELF REGISTRATION

     (a) Shelf Registration. If (i) the Issuer is not required to file the
Exchange Offer Registration Statement or not permitted to consummate the
Exchange Offer because the Exchange Offer is not permitted by applicable law or
Commission policy (after the procedures set forth in Section 6(a) below have
been complied with) or (ii) any Initial Purchaser that is a Holder of Transfer
Restricted Securities notifies the Company prior to the 20th day following
consummation of the Exchange Offer that (a) it is prohibited by law or
Commission policy from participating in the Exchange Offer or (b) it may not
resell the Exchange Notes acquired by it in the Exchange Offer to the public
without delivering a prospectus and the prospectus contained in the Exchange
Offer Registration Statement is not appropriate or available for such resales
the Issuer and the Guarantors shall:



                                      -5-


     (1) cause to be filed a shelf registration statement pursuant to Rule 415
under the Securities Act, which may be an amendment to the Exchange Offer
Registration Statement (in either event, the "Shelf Registration Statement") as
soon as practicable but in any event on or prior to 60 days after the obligation
to file the Shelf Registration Statement arises (such date being the "Shelf
Filing Deadline"), which Shelf Registration Statement shall provide for resales
of all Transfer Restricted Securities the Holders of which shall have provided
the information required pursuant to Section 4(b) hereof; and

     (2) use its commercially reasonable best efforts to cause such Shelf
Registration Statement to be declared effective by the Commission on or prior to
the 180th day after such obligation arises.

The Issuer and the Guarantors shall use their respective commercially reasonable
best efforts to keep such Shelf Registration Statement continuously effective,
supplemented and amended as required by the provisions of Sections 6(b) and (c)
hereof to the extent necessary to ensure that it is available for resales of
Notes by the Holders of Transfer Restricted Securities entitled to the benefit
of this Section 4(a), and to ensure that it conforms with the requirements of
this Agreement, the Securities Act and the policies, rules and regulations of
the Commission as announced from time to time, for a period of at least two
years following the effective date of such Shelf Registration Statement (or
shorter period that will terminate when all the Notes covered by such Shelf
Registration Statement have been sold pursuant to such Shelf Registration
Statement or are otherwise no longer Transfer Restricted Securities).

     (b) Provision by Holders of Certain Information in Connection with the
Shelf Registration Statement. No Holder of Transfer Restricted Securities may
include any of its Transfer Restricted Securities in any Shelf Registration
Statement pursuant to this Agreement unless and until such Holder furnishes to
the Issuer in writing, within 10 business days after receipt of a request
therefor, such information as the Issuer may reasonably request for use in
connection with any Shelf Registration Statement or Prospectus or preliminary
Prospectus included therein. Each Holder as to which any Shelf Registration
Statement is being effected agrees to furnish promptly to the Issuer all
information required to be disclosed in order to make the information previously
furnished to the Issuer by such Holder not materially misleading.

                          SECTION 5. LIQUIDATED DAMAGES

     (a) If (i) any of the Registration Statements required by this Agreement is
not filed with the Commission on or prior to the date specified for such filing
in this Agreement, (ii) any of such Registration Statements has not been
declared effective by the Commission on or prior to the date specified for such
effectiveness in this Agreement, regardless of the reasonableness of any efforts
made by or on behalf of the Issuer and the Guarantors to cause such Registration
Statement to become effective), (iii) the Company and the Guarantors fail to
consummate the Exchange Offer within 60 business days of the date the Exchange
Offer Registration Statement was declared effective with respect to the Exchange
Offer Registration Statement, or (iv) any Registration Statement required by
this Agreement is filed and declared effective but shall thereafter cease to be
effective or fail to be usable for the periods specified in Sections 3(d) and
4(a) hereof without being succeeded immediately by a post-effective amendment to
such



                                      -6-


Registration Statement that cures such failure and that is itself immediately
declared effective (each such event referred to in clauses (i) through (iv), a
"Registration Default"), then the Issuer will pay Liquidated Damages to each
Holder of Transfer Restricted Securities, with respect to the first 90-day
period immediately following the occurrence of the first Registration Default,
in an amount equal to $.05 per week per $1,000 principal amount of Transfer
Restricted Securities held by such Holder. The amount of the Liquidated Damages
will increase by an additional $.05 per week per $1,000 principal amount of
Transfer Restricted Securities with respect to each subsequent 90-day period
until all Registration Defaults have been cured, up to a maximum amount of
Liquidation Damages of $.30 per week per $1,000 principal amount of Transfer
Restricted Securities. All accrued Liquidated Damages will be paid by the Issuer
on each interest Payment Date in the manner specified by the Indenture for the
payment of interest. Following the cure of all Registration Defaults, the
accrual of Liquidated Damages will cease; provided, that no Holder of Transfer
Restricted Securities who is not entitled to the benefits of a Shelf
Registration statement shall be entitled to receive Liquidated Damages by reason
of a Registration Default that pertains to a Shelf Registration Statement and no
Holder of Transfer Restricted Securities or any other Holder of Transfer
Restricted Securities who is entitled to the benefits of a Shelf Registration
Statement shall be entitled to receive Liquidated Damages by reason of a
Registration Default that pertains to an Exchange Offer.

     (b) All obligations of the Issuer set forth in the preceding paragraph that
are outstanding with respect to any Transfer Restricted Security at the time
such security ceases to be a Transfer Restricted Security shall survive until
such time as all such obligations with respect to such Note shall have been
satisfied in full.

                       SECTION 6. REGISTRATION PROCEDURES

     (a) Exchange Offer Registration Statement. In connection with the Exchange
Offer, the Issuer and the Guarantors shall comply with all of the applicable
provisions of Section 6(c) below, shall use their respective commercially
reasonable best efforts to effect such exchange to permit the sale of
Broker-Dealer Transfer Restricted Securities being sold in accordance with the
intended method or methods of distribution thereof, and shall comply with all of
the following provisions:

          (i) If in the reasonable opinion of counsel to the Issuer there is a
     question as to whether the Exchange Offer is permitted by applicable law,
     the Issuer and the Guarantors hereby agree to seek a no-action letter or
     other favorable decision from the Commission allowing the Issuer and the
     Guarantors to Consummate an Exchange Offer for such Restricted Notes. The
     Issuer and the Guarantors hereby agree to pursue the issuance of such a
     decision to the Commission staff level but shall not be required to take
     commercially unreasonable action to effect a change of Commission policy.
     The Issuer and the Guarantors hereby agree, however, to (A) participate in
     telephonic conferences with the Commission, (B) deliver to the Commission
     staff an analysis prepared by counsel to the Issuer setting forth the legal
     bases, if any, upon which such counsel has concluded that such an Exchange
     Offer should be permitted and (C) diligently pursue a favorable resolution
     by the Commission staff of such submission.



                                      -7-


          (ii) As a condition to its participation in the Exchange Offer
     pursuant to the terms of this Agreement, each Holder of Transfer Restricted
     Securities shall furnish, upon the request of the Issuer, prior to the
     Consummation thereof, a written representation to the Issuer and the
     Guarantors (which may be contained in the letter of transmittal
     contemplated by the Exchange Offer Registration Statement) to the effect
     that (A) it is not an affiliate of the Issuer, (B) it is not engaged in,
     and does not intend to engage in, and has no arrangement or understanding
     with any person to participate in, a distribution of the Exchange Notes to
     be issued in the Exchange Offer and (C) it is acquiring the Exchange Notes
     in its ordinary course of business. In addition, all such Holders of
     Transfer Restricted Securities shall otherwise cooperate in the Issuer's
     preparations for the Exchange Offer. Each Holder shall acknowledge and
     agree that any Broker-Dealer and any such Holder using the Exchange Offer
     to participate in a distribution of the securities to be acquired in the
     Exchange Offer (1) could not under Commission policy as in effect on the
     date of this Agreement rely on the position of the Commission enunciated in
     Morgan Stanley and Co., Inc. (available June 5, 1991) and Exxon Capital
     Holdings Corporation (available May 13, 1988), as interpreted in the
     Commission's letter to Shearman & Sterling dated July 2, 1993, and similar
     no-action letters (which may include any no-action letter obtained pursuant
     to clause (i) above), and (2) must comply with the registration and
     prospectus delivery requirements of the Securities Act in connection with a
     secondary resale transaction and that such a secondary resale transaction
     should be covered by an effective registration statement containing the
     selling security holder information required by Item 507 or 508, as
     applicable, of Regulation S-K if the resales are of Exchange Notes obtained
     by such Holder in exchange for Restricted Notes acquired by such Holder
     directly from the Issuer.

     (b) Shelf Registration Statement. In connection with the Shelf Registration
Statement, the Issuer and the Guarantors shall comply with all the provisions of
Section 6(c) below and shall use their respective commercially reasonable best
efforts to effect such registration to permit the sale of the Transfer
Restricted Securities being sold in accordance with the intended method or
methods of distribution thereof, and pursuant thereto the Issuer and the
Guarantors will prepare and file with the Commission a Registration Statement
relating to the registration on any appropriate form under the Securities Act,
which form shall be available for the sale of the Transfer Restricted Securities
in accordance with the intended method or methods of distribution thereof.

     (c) General Provisions. In connection with any Registration Statement and
any Prospectus required by this Agreement to permit the sale or resale of
Transfer Restricted Securities (including, without limitation, any Registration
Statement and the related Prospectus required to permit resales of Broker-Dealer
Transfer Restricted Securities by Restricted Broker-Dealers), the Issuer and the
Guarantors shall:

          (i) use their respective commercially reasonable best efforts to keep
     such Registration Statement continuously effective and provide all
     requisite financial statements for the period specified in Section 3 or 4
     of this Agreement, as applicable; upon the occurrence of any event that
     would cause any such Registration Statement or the Prospectus contained
     therein (A) to contain a material misstatement or omission or (B)



                                      -8-


     not to be effective and usable for resale of Transfer Restricted Securities
     during the period required by this Agreement, the Issuer shall file
     promptly an appropriate amendment to such Registration Statement, in the
     case of clause (A), correcting any such misstatement or omission, and, in
     the case of either clause (A) or (B), use their respective commercially
     reasonable best efforts to cause such amendment to be declared effective
     and such Registration Statement and the related Prospectus to become usable
     for their intended purpose(s) as soon as practicable thereafter;

          (ii) prepare and file with the Commission such amendments and
     post-effective amendments to the Registration Statement as may be necessary
     to keep the Registration Statement effective for the applicable period set
     forth in Section 3 or 4 hereof, as applicable, or such shorter period as
     will terminate when all Transfer Restricted Securities covered by such
     Registration Statement have been sold; cause the Prospectus to be
     supplemented by any required Prospectus supplement, and as so supplemented
     to be filed pursuant to Rule 424 under the Securities Act, and to comply
     fully with the applicable provisions of Rules 424 and 430A under the
     Securities Act in a timely manner; and comply with the provisions of the
     Securities Act with respect to the disposition of all securities covered by
     such Registration Statement during the applicable period in accordance with
     the intended method or methods of distribution by the sellers thereof set
     forth in such Registration Statement or supplement to the Prospectus;

          (iii) advise the underwriter(s), if any, and each selling Holder
     promptly and, if requested by such Persons, to confirm such advice in
     writing, (A) when the Prospectus or any Prospectus supplement or
     post-effective amendment has been filed, and, with respect to any
     Registration Statement or any post-effective amendment thereto, when the
     same has become effective, (B) of any request by the Commission for
     amendments to the Registration Statement or amendments or supplements to
     the Prospectus or for additional information relating thereto, (C) of the
     issuance by the Commission of any stop order suspending the effectiveness
     of the Registration Statement under the Securities Act or of the suspension
     by any state securities commission of the qualification of the Transfer
     Restricted Securities for offering or sale in any jurisdiction, or the
     initiation of any proceeding for any of the preceding purposes, (D) of the
     existence of any fact or the happening of any event that makes any
     statement of a material fact made in the Registration Statement, the
     Prospectus, any amendment or supplement thereto, or any document
     incorporated by reference therein untrue in any material respect, or that
     requires the making of any additions to or changes in the Registration
     Statement or the Prospectus in order to make the statements therein not
     misleading in any material respect. If at any time the Commission shall
     issue any stop order suspending the effectiveness of the Registration
     Statement, or any state securities commission or other regulatory authority
     shall issue an order suspending the qualification or exemption from
     qualification of the Transfer Restricted Securities under state securities
     or Blue Sky laws, the Issuer and the Guarantors shall use their respective
     best efforts to obtain the withdrawal or lifting of such order at the
     earliest possible time;

          (iv) furnish without charge to each of the Initial Purchasers that are
     Holders of Transfer Restricted Securities covered by such Registration
     Statement and each of the



                                      -9-


     underwriter(s), if any, before filing with the Commission, copies of any
     Registration Statement or any Prospectus included therein or any amendments
     or supplements to any such Registration Statement or Prospectus, which
     documents will be subject to the review of such Initial Purchasers and
     underwriter(s), if any, for a period of at least five business days, and
     the Issuer and the Guarantors will not file any such Registration Statement
     or Prospectus or any amendment or supplement to any such Registration
     Statement or Prospectus (including all such documents incorporated by
     reference) to which any such Initial Purchaser or the underwriter(s), if
     any, shall reasonably object in writing within five business days after the
     receipt thereof (such objection to be deemed timely made upon confirmation
     of telecopy transmission within such period). The objection of any such
     Initial Purchaser or underwriter, if any, shall be deemed to be reasonable
     if such Registration Statement, amendment, Prospectus or supplement, as
     applicable, as proposed to be filed, contains a material misstatement or
     omission;

          (v) a reasonable time prior to the filing of any document that is to
     be incorporated by reference into a Registration Statement or Prospectus,
     provide copies of such document to the Initial Purchasers which are selling
     Holders and to the underwriter(s), if any, and make the Issuer's and the
     Guarantors' representatives available for discussion of such document and
     other customary due diligence matters;

          (vi) make available upon request at reasonable times for inspection by
     the Initial Purchasers which are selling Holders, any managing underwriter
     participating in any disposition pursuant to such Registration Statement,
     and any attorney or accountant retained by any of the underwriter(s) (the
     "Inspectors"), all financial and other records, pertinent corporate
     documents of the Issuer and the Guarantors and cause the Issuer's and the
     Guarantors' officers, directors and employees to supply all information
     reasonably requested by any such underwriter, attorney or accountant in
     connection with such Registration Statement subsequent to the filing
     thereof and prior to its effectiveness, provided however, that such
     Inspector shall first agree in writing with the Company that any
     information that is reasonably and in good faith designated by the Company
     in writing as confidential at the time of delivery of such information
     shall be kept confidential by such Inspectors, unless (a) disclosure of
     such information is required by court or administrative order or is
     necessary to respond to inquiries of regulatory authorities, (b) disclosure
     of such information is required by law (including any disclosure
     requirements pursuant to federal securities laws in connection with the
     filing of such Registration Statement or the use of any Prospectus), (c)
     such information becomes generally available to the public other than as a
     result of a disclosure or failure to safeguard such information by such
     Inspector or (d) such information becomes available to such Inspector from
     a source other than the Company and its subsidiaries and such source is not
     known, after due inquiry, by such Inspector to be bound by a
     confidentiality agreement; provided further, that the foregoing
     investigation shall be coordinated on behalf of such Inspectors by a
     limited number of representatives designated by and on behalf of such
     Inspectors and any such confidential information shall be available from
     such representatives to such Inspectors so long as any Inspector agrees to
     be bound by such confidentiality agreement;



                                      -10-


          (vii) if requested by the Initial Purchasers and the underwriter(s),
     if any, promptly incorporate in any Registration Statement or Prospectus,
     pursuant to a supplement or post-effective amendment if necessary, such
     information as such selling Holders and underwriter(s), if any, may
     reasonably request to have included therein, including, without limitation,
     information relating to the "Plan of Distribution" of the Transfer
     Restricted Securities; and make all required filings of such Prospectus
     supplement or post-effective amendment as soon as practicable after the
     Issuer is notified of the matters to be incorporated in such Prospectus
     supplement or post-effective amendment;

          (viii) except with respect to the Exchange Offer, use their respective
     commercially reasonable best efforts to (a) if the Transfer Restricted
     Securities have been rated prior to the initial sale of such Transfer
     Restricted Securities, confirm such ratings will apply to the Transfer
     Restricted Securities covered by a Registration Statement, or (b) cause the
     Transfer Restricted Securities covered by a Registration Statement to be
     rated with the appropriate rating agencies, if so requested by the Holders
     of a majority in aggregate principal amount of Notes covered thereby or the
     underwriter(s), if any;

          (ix) furnish to each selling Holder and each of the underwriter(s), if
     any, without charge, at least one copy of the Registration Statement, as
     first filed with the Commission, and of each amendment thereto, including
     financial statements and schedules, all documents incorporated by reference
     therein and all exhibits (including exhibits incorporated therein by
     reference);

          (x) deliver to each selling Holder and each of the underwriter(s), if
     any, without charge, as many copies of the Prospectus (including each
     preliminary prospectus) and any amendment or supplement thereto as such
     Persons reasonably may request; the Issuer and the Guarantors hereby
     consent to the use (in accordance with law) of the Prospectus and any
     amendment or supplement thereto by each of the selling Holders and each of
     the underwriter(s), if any, in connection with the offering and the sale of
     the Transfer Restricted Securities covered by the Prospectus or any
     amendment or supplement thereto;

          (xi) enter into such agreements (including an underwriting agreement),
     and make such representations and warranties, and take all such other
     actions in connection therewith in order to expedite or facilitate the
     disposition of the Transfer Restricted Securities pursuant to any
     Registration Statement contemplated by this Agreement, all to such extent
     as may be reasonable requested in writing by any Initial Purchaser that is
     a selling Holder or by any underwriter in connection with any sale or
     resale of Transfer Restricted Securities pursuant to any Registration
     Statement contemplated by this Agreement; and the Issuer and the Guarantors
     shall:

               (A) upon written request furnish to each underwriter, if any, in
          such substance and scope as they may reasonably request and as are
          customarily made by issuers to underwriters in primary underwritten
          offerings, upon the date of the



                                      -11-


          Consummation of the Exchange Offer and, if applicable, the
          effectiveness of the Shelf Registration Statement:

                    (1) a certificate of the Issuer, dated the date of
               Consummation of the Exchange Offer or the date of effectiveness
               of the Shelf Registration Statement, as the case may be, signed
               by the Chief Executive Officer and Chief Financial Officer of the
               Issuer, and a certificate of each Guarantor, signed by two
               authorized officers of such Guarantor, dated the date of
               Consummation of the Exchange Offer or the date of effectiveness
               of the Shelf Registration Statement, as the case may be, as of
               the date thereof, the matters set forth in Section 8 (a) of the
               Purchase Agreement but applying, mutatis mutandis, to the Shelf
               Registration Statement in each place where reference is made to
               the Offering Memorandum in such Section 8(a), and to the filing
               date of the Shelf Registration Statement in each place where
               reference is made to "the Closing Date" or "the date hereof" in
               such Section 8(a), and such other matters as such parties may
               reasonably request;

                    (2) a customary opinion, dated the date of Consummation of
               the Exchange Offer or the date of effectiveness of the Shelf
               Registration Statement, as the case may be, of counsel for the
               Issuer and the Guarantors covering the matters set forth in
               Section 8(b) of the Purchase Agreement and such other matter as
               such parties may reasonably request; and

                    (3) a customary comfort letter, dated as of the date of
               Consummation of the Exchange Offer or the date of effectiveness
               of the Shelf Registration Statement, as the case may be, from the
               Issuer's and the Guarantors' independent accountants, in the
               customary form and covering matters of the type customarily
               covered in comfort letters by underwriters in connection with
               primary underwritten offerings, and affirming the matters set
               forth in the comfort letters delivered pursuant to Section 8 of
               the Purchase Agreement, as they relate to the Shelf Registration
               Statement without exception;

               (B) set forth in full or incorporate by reference in the
          underwriting agreement, if any, the indemnification provisions and
          procedures of Section 8 hereof with respect to all parties to be
          indemnified pursuant to said Section; and

               (C) deliver such other documents and certificates as may be
          reasonably requested in writing by such parties to evidence compliance
          with clause (A) above and with any customary conditions contained in
          the underwriting agreement or other agreement entered into by the
          Issuer and the Guarantors pursuant to this clause (xi), if any.

          (xii) If the representations and warranties of the Issuer and the
     Guarantors contemplated in clause (A)(1) above cease to be true and correct
     in any material respect,



                                      -12-


     the Issuer and the Guarantors shall so advise the Initial Purchasers which
     are selling Holders and the underwriter(s), if any, promptly and, if
     requested by such Persons, shall confirm such advice in writing;

          (xiii) prior to any public offering of Transfer Restricted Securities,
     cooperate with the selling Holders, the underwriter(s), if any, and their
     respective counsel in connection with the registration and qualification of
     the Transfer Restricted Securities under the securities or Blue Sky laws of
     such jurisdictions as the selling Holders or underwriter(s) may request and
     do any and all other acts or things necessary or advisable to enable the
     disposition in such jurisdictions of the Transfer Restricted Securities
     covered by the Shelf Registration Statement; provided, however, that the
     Issuer and the Guarantors shall not be required to register or qualify as a
     foreign corporation where it is not then so qualified or to take any action
     that would subject it to the service of process in suits or to taxation,
     other than as to matters and transactions relating to the Registration
     Statement, in any jurisdiction where it is not then so subject;

          (xiv) shall issue, upon the request of any Holder of Restricted Notes
     covered by the Shelf Registration Statement, Exchange Notes, having an
     aggregate principal amount at maturity equal to the aggregate principal
     amount at maturity of Restricted Notes surrendered to the Issuer by such
     Holder in exchange therefor or being sold by such Holder; such Exchange
     Notes to be registered in the name of such Holder or in the name of the
     purchaser(s) of such Notes, as the case may be; in return, the Restricted
     Notes held by such Holder shall be surrendered to the Issuer for
     cancellation;

          (xv) in connection with any sale of Transfer Restricted Securities
     that will result in such securities no longer being Transfer Restricted
     Securities, cooperate with the selling Holders and the underwriter(s), if
     any, to facilitate the timely preparation and delivery of certificates
     representing Transfer Restricted Securities to be sold and not bearing any
     restrictive legends; and enable such Transfer Restricted Securities to be
     in such denominations and registered in such names as the Holders or the
     underwriter(s), if any, may request in writing at least two business days
     prior to such sale of Transfer Restricted Securities made by such
     underwriter(s);

          (xvi) use their respective commercially reasonable best efforts to
     cause the Transfer Restricted Securities covered by the Registration
     Statement to be registered with or approved by such other governmental
     agencies or authorities as may be necessary to enable the seller or sellers
     thereof or the underwriter(s), if any, to consummate the disposition of
     such Transfer Restricted Securities, subject to the proviso contained in
     clause (xiii) above;

          (xvii) if any fact or event contemplated by clause (c)(iii)(D) above
     shall exist or have occurred, prepare a supplement or post-effective
     amendment to the Registration Statement or related Prospectus or any
     document incorporated therein by reference or file any other required
     document so that, as thereafter delivered to the purchasers of Transfer
     Restricted Securities, the Prospectus will not contain an untrue statement
     of a material



                                      -13-


     fact or omit to state any material fact necessary to make the statements
     therein not misleading

          (xviii) provide a CUSIP number for all Transfer Restricted Securities
     not later than the effective date of the Registration Statement and provide
     the Trustee under the Indenture with printed certificates for the Transfer
     Restricted Securities which are in a form eligible for deposit with The
     Depositary Trust Company;

          (xix) cooperate and assist in any filings required to be made with the
     NASD and in the performance of any due diligence investigation by any
     underwriter (including any "qualified independent underwriter") that is
     required to be retained in accordance with the rules and regulations of the
     NASD, and use their respective reasonable best efforts to cause such
     Registration Statement to become effective and approved by such
     governmental agencies or authorities as may be necessary to enable the
     Holders selling Transfer Restricted Securities to consummate the
     disposition of such Transfer Restricted Securities;

          (xx) otherwise use their respective commercially reasonable best
     efforts to comply with all applicable rules and regulations of the
     Commission, and make generally available to its security holders, as soon
     as practicable, a consolidated earnings statement meeting the requirements
     of Rule 158 (which need not be audited) for the twelve-month period (A)
     commencing at the end of any fiscal quarter in which Transfer Restricted
     Securities are sold to underwriters in a firm or best efforts Underwritten
     Offering or (B) if not sold to underwriters in such an offering, beginning
     with the first month of the Issuer's first fiscal quarter commencing after
     the effective date of the Registration Statement;

          (xxi) cause the Indenture to be qualified under the TIA not later than
     the effective date of the first Registration Statement required by this
     Agreement, and, in connection therewith, cooperate with the Trustee and the
     Holders of Notes to effect such changes to the Indenture as may be required
     for such Indenture to be so qualified in accordance with the terms of the
     TIA; and execute and use their respective commercially reasonable best
     efforts to cause the Trustee to execute, all documents that may be required
     to effect such changes and all other forms and documents required to be
     filed with the Commission to enable such Indenture to be so qualified in a
     timely manner; and

          (xxii) provide promptly to each Holder upon request each document
     filed with the Commission pursuant to the requirements of Section 13 and
     Section 15 of the Exchange Act.

     Each Holder agrees by acquisition of a Transfer Restricted Security that,
upon receipt of any notice from the Issuer of the existence of any fact of the
kind described in Section 6(c)(iii)(D) hereof (a "Suspension Notice"), such
Holder will forthwith discontinue disposition of Transfer Restricted Securities
pursuant to the applicable Registration Statement until such Holder's receipt of
the copies of the supplemented or amended Prospectus contemplated by Section
6(c)(xvii) hereof, or until it is advised in writing (the "Advice") by the
Issuer that the use of the Prospectus may be resumed, and has received copies of
any additional or supplemental



                                      -14-


filings that are incorporated by reference in the Prospectus. If so directed by
the Issuer, each Holder hereby agrees it will deliver to the Issuer (at the
Issuer's expense) all copies, other than permanent file copies then in such
Holder's possession, of the Prospectus covering such Transfer Restricted
Securities that was current at the time of receipt of such notice. In the event
the Issuer shall give any such notice, the time period regarding the
effectiveness of such Registration Statement set forth in Section 3 or 4 hereof,
as applicable, shall be extended by the number of days during the period from
and including the date of the giving of such Suspension Notice to and including
the date when each selling Holder covered by such Registration Statement shall
have received the copies of the supplemented or amended Prospectus contemplated
by Section 6(c)(xvii) hereof or shall have received the Advice; however, no such
extension shall be taken into account in determining whether Liquidated Damages
is due pursuant to Section 5 hereof or the amount of such Liquidated Damages, it
being agreed that the Issuer's option to suspend use of a Registration Statement
pursuant to this paragraph shall be treated as a Registration Default for
purposes of Section 5.

                        SECTION 7. REGISTRATION EXPENSES

     (a) All expenses incident to the Issuer's and the Guarantors' performance
of or compliance with this Agreement will be borne by the Issuer regardless of
whether a Registration Statement becomes effective, including without
limitation: (i) all registration and filing fees and expenses (including filings
made by the Initial Purchasers or Holders with the NASD (and, if applicable, the
fees and expenses of any "qualified independent underwriter" and its counsel
that may be required by the rules and regulations of the NASD)); (ii) all fees
and expenses of compliance with federal securities and state Blue Sky or
securities laws; (iii) all expenses of printing (including printing certificates
for the Exchange Notes to be issued in the Exchange Offer and printing of
Prospectuses), messenger and delivery services and telephone; (iv) all fees and
disbursements of counsel for the Issuer and the Guarantors and, subject to
Section 7(b) below, the Holders of Transfer Restricted Securities; and (v) all
fees and disbursements of independent certified public accountants of the Issuer
and the Guarantors (including the expenses of any special audit and comfort
letters required by or incident to such performance).

     The Issuer and the Guarantors will, in any event, bear their respective
internal expenses (including, without limitation, all salaries and expenses of
their respective officers and employees performing legal or accounting duties),
the expenses of any annual audit and the fees and expenses of any Person,
including special experts, retained by the Issuer and the Guarantors.

     Each Holder shall pay all commissions and transfer taxes, if any, relating
to the sale or disposition of such Holder's Notes.

     (b) In connection with any Shelf Registration Statement required by this
Agreement, the Issuer and the Guarantors will reimburse the Initial Purchasers
and the Holders of Transfer Restricted Securities being registered pursuant to
the Shelf Registration Statement for the reasonable fees and disbursements of
not more than one counsel, who shall be Kramer Levin Naftalis & Frankel LLP or
such other counsel as may be chosen by the Holders of a majority in principal
amount of the Transfer Restricted Securities for whose benefit such Shelf
Registration Statement is being prepared.



                                      -15-


                           SECTION 8. INDEMNIFICATION

     (a) The Issuer and the Guarantors agree, jointly and severally, to
indemnify and hold harmless (i) each Holder and (ii) each person, if any, who
controls (within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act) any Holder (any of the persons referred to in this clause
(ii) being hereinafter referred to as a "controlling person") and (iii) the
respective officers, directors, partners, employees, representatives and agents
of any Holder or any controlling person (any person referred to in clause (i),
(ii) or (iii) may hereinafter be referred to as an "Indemnified Holder"), to the
fullest extent lawful, from and against any and all losses, claims, damages,
liabilities, judgments, actions and expenses (including without limitation and
as incurred, reimbursement of all reasonable costs of investigating, preparing,
pursuing, settling, compromising, paying or defending any claim or action, or
any investigation or proceeding by any governmental agency or body, commenced or
threatened, including the reasonable fees and expenses of counsel to any
Indemnified Holder), joint or several, directly or indirectly caused by, related
to, based upon, arising out of or in connection with any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement or Prospectus (in each case, including the documents incorporated by
reference therein), or in any supplement thereto or amendment thereof, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or expenses are
caused by an untrue statement or omission or alleged untrue statement or
omission that is made in reliance upon and in conformity with information
relating to any of the Holders furnished in writing to the Issuer by any of the
Holders expressly for use therein. This indemnity agreement shall be in addition
to any liability which the Issuer and the Guarantors may otherwise have,
including this Agreement.

     In case any action or proceeding (including any governmental or regulatory
investigation or proceeding) shall be brought or asserted against any of the
Indemnified Holders with respect to which indemnity may be sought against the
Issuer and the Guarantors, such Indemnified Holder (or the Indemnified Holder
controlled by such controlling person) shall promptly notify the Issuer in
writing (provided, that the failure to give such notice shall not relieve the
Issuer and the Guarantors of their respective obligations pursuant to this
Agreement). Such Indemnified Holder shall have the right to employ its own
counsel in any such action and the fees and expenses of such counsel shall be
paid, as incurred, by the Issuer and the Guarantors. The Issuer and the
Guarantors shall not, in connection with any one such action or proceeding or
separate but substantially similar or related actions or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys (in addition to any local counsel) at any time for such Indemnified
Holders, which firm shall be designated by the Holders. The Issuer and the
Guarantors shall be liable for any settlement of any such action or proceeding
effected with the Issuer's prior written consent, which consent shall not be
withheld unreasonably, and the Issuer and the Guarantors agree to indemnify and
hold harmless any Indemnified Holder from and against any loss, claim, damage,
liability or expense by reason of any settlement of any action effected with the
written consent of the Issuer. The Issuer and the Guarantors shall not, without
the prior written consent of each Indemnified Holder, settle or compromise or
consent to the entry of judgment in or otherwise seek to terminate any pending
or threatened action, claim,



                                      -16-


litigation or proceeding in respect of which indemnification or contribution may
be sought hereunder (whether or not any Indemnified Holder is a party thereto),
unless such settlement, compromise, consent or termination includes an
unconditional release of each Indemnified Holder from all liability arising out
of such action, claim, litigation or proceeding.

     (b) Each Holder of Transfer Restricted Securities agrees, severally and not
jointly, to indemnify and hold harmless (i) the Issuer and the Guarantors, (ii)
each person, if any, who controls the Issuer or any of the Guarantors within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, and (iii)
the officers, directors, partners, employees, representatives and agents of the
Issuer or the Guarantors to the same extent as the foregoing indemnity from the
Issuer and the Guarantors to each of the Indemnified Holders, but only with
respect to claims and actions based on information relating to such Holder
furnished in writing by such Holder expressly for use in any Registration
Statement. In case any action or proceeding shall be brought against the Issuer
and the Guarantors or their respective directors or officers or any such
controlling person in respect of which indemnity may be sought against a Holder
of Transfer Restricted Securities, such Holder shall have the rights and duties
given the Issuer and the Guarantors and the Issuer and the Guarantors or their
respective directors or officers or such controlling person shall have the
rights and duties given to each Holder by the preceding paragraph. In no event
shall the liability of any selling Holder hereunder be greater in amount than
the dollar amount of the proceeds received by such Holder upon the sale of the
Transfer Restricted Securities giving rise to such indemnification obligation.

     (c) If the indemnification provided for in this Section 8 is unavailable to
an indemnified party under Section 8(a) or Section 8(b) hereof (other than by
reason of exceptions provided in those Sections) in respect of any losses,
claims, damages, liabilities, judgments, actions or expenses referred to
therein, then each applicable indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages, liabilities or
expenses in such proportion as is appropriate to reflect the relative benefits
received by the Issuer and the Guarantors on the one hand and the Holders on the
other hand from the Initial Placement (which in the case of the Issuer and the
Guarantors shall be deemed to be equal to the total gross proceeds from the
Initial Placement as set forth on the cover page of the Offering Memorandum),
the amount of Liquidated Damages which did not become payable as a result of the
filing of the Registration Statement resulting in such losses, claims, damages,
liabilities, judgments actions or expenses, and such Registration Statement, or
if such allocation is not permitted by applicable law, the relative fault of the
Issuer and the Guarantors on the one hand and of the Indemnified Holder on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative fault of the Issuer and the Guarantors on
the one hand and of the Indemnified Holder on the other shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Issuer or by the Indemnified Holder and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The amount paid or payable by
a party as a result of the losses, claims, damages, liabilities and expenses
referred to above shall be deemed to include, subject to the limitations set
forth in the second paragraph of Section 8(a), any legal or other fees or
expenses



                                      -17-


reasonably incurred by such party in connection with investigating or defending
any action or claim.

     The Issuer and the Guarantors and each Holder of Transfer Restricted
Securities agree that it would not be just and equitable if contribution
pursuant to this Section 8(c) were determined by pro rata allocation (even if
the Holders were treated as one entity for such purpose) or by any other method
of allocation which does not take account of the equitable considerations
referred to in the immediately preceding paragraph. The amount paid or payable
by an indemnified party as a result of the losses, claims, damages, liabilities
or expenses referred to in the immediately preceding paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 8, none of the Holders (and its related Indemnified
Holders) shall be required to contribute, in the aggregate, any amount in excess
of the amount by which the total discount received by such Holder with respect
to the Restricted Notes exceeds the amount of any damages which such Holder has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Holders' obligations to contribute pursuant to
this Section 8(c) are several in proportion to the respective principal amount
at maturity of Restricted Notes held by each of the Holders hereunder and not
joint.

                              SECTION 9. RULE 144A

     The Issuer and the Guarantors hereby agree with each Holder, for so long as
any Transfer Restricted Securities remain outstanding and during any period in
which the Issuer or such Guarantor (i) is not subject to Section 13 or 15(d) of
the Exchange Act, to make available, upon request of any Holder, to such Holder
or beneficial owner of Transfer Restricted Securities in connection with any
sale thereof and any prospective purchaser of such Transfer Restricted
Securities designated by such Holder or beneficial owner, the information
required by Rule 144A(d)(4) under the Securities Act in order to permit resales
of such Transfer Restricted Securities pursuant to Rule 144A, and (ii) is
subject to Section 13 or 15(d) of the Exchange Act, to make all filings required
thereby in a timely manner in order to permit resales of such Transfer
Restricted Securities pursuant to Rule 144.

             SECTION 10. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS

     No Holder may participate in any Underwritten Registration hereunder unless
such Holder (a) agrees to sell such Holder's Transfer Restricted Securities on
the basis provided in any underwriting arrangements approved by the Persons
entitled hereunder to approve such arrangements and (b) completes and executes
all reasonable questionnaires, powers of attorney, indemnities, underwriting
agreements, lock-up letters and other documents required under the terms of such
underwriting arrangements.

                      SECTION 11. SELECTION OF UNDERWRITERS



                                      -18-


     The Holders of Transfer Restricted Securities covered by the Shelf
Registration Statement who desire to do so may sell such Transfer Restricted
Securities in an Underwritten Offering. In any such Underwritten Offering, the
investment banker or investment bankers and manager or managers that will
administer the offering will be selected by the Issuer and the Guarantors.

                            SECTION 12. MISCELLANEOUS

     (a) Remedies. The Issuer and the Guarantors agree that monetary damages
would not be adequate compensation for any loss incurred by reason of a breach
by it of the provisions of this Agreement and hereby agree to waive the defense
in any action for specific performance that a remedy at law would be adequate.

     (b) No Inconsistent Agreements. The Issuer and the Guarantors will not, on
or after the date of this Agreement, enter into any agreement with respect to
its securities that is inconsistent with the rights granted to the Holders in
this Agreement or otherwise conflicts with the provisions hereof. The Issuer and
the Guarantors have not previously entered into any agreement granting any
registration rights with respect to its securities to any Person. The rights
granted to the Holders hereunder do not in any way conflict with and are not
inconsistent with the rights granted to the holders of the Issuer's and the
Guarantors' securities under any agreement in effect on the date hereof.

     (c) Adjustments Affecting the Notes. Subject to the foregoing provisions of
this Agreement, the Issuer will not take any action, or permit any change to
occur, with respect to the Notes that would materially and adversely affect the
ability of the Holders to Consummate the Exchange Offer.

     (d) Amendments and Waivers. The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to or departures from
the provisions hereof may not be given unless the Issuer and the Guarantors have
obtained the written consent of Holders of a majority of the outstanding
principal amount at maturity of Transfer Restricted Securities. Notwithstanding
the foregoing, a waiver or consent to departure from the provisions hereof that
relates exclusively to the rights of Holders whose securities are being tendered
pursuant to the Exchange Offer and that does not affect directly or indirectly
the rights of other Holders whose securities are not being tendered pursuant to
such Exchange Offer may be given by the Holders of a majority of the outstanding
principal amount at maturity of Transfer Restricted Securities being tendered or
registered; provided that, with respect to any matter that directly or
indirectly affects the rights of any Initial Purchaser hereunder, the Issuer and
the Guarantors shall obtain the written consent of each such Initial Purchaser
with respect to which such amendment, qualification, supplement, waiver, consent
or departure is to be effective.

     (e) Notices. All notices and other communications provided for or permitted
hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, telecopier, or air
courier guaranteeing overnight delivery:



                                      -19-


          (i) if to a Holder, at the address set forth on the records of the
     Registrar under the Indenture, with a copy to the Registrar under the
     Indenture; and

          (ii) if to the Issuer and the Guarantors:

                Vail Resorts, Inc.
                137 Benchmark Road
                Avon, Colorado 81620
                Telecopier No.:  (970) 845-2521
                Attention:  Chief Executive Officer

                with a copy to:

                Cahill Gordon & Reindel
                80 Pine Street
                New York, New York 10005
                Telecopier No.:  (212) 269-5420
                Attention:  James Clark,  Esq.

     All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt acknowledged, if telecopied; and on the
next business day, if timely delivered to an air courier guaranteeing overnight
delivery.

     Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.

     (f) Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the successors and assigns of each of the parties, including
without limitation and without the need for an express assignment, subsequent
Holders of Transfer Restricted Securities; provided, however, that this
Agreement shall not inure to the benefit of or be binding upon a successor or
assign of a Holder unless and to the extent such successor or assign acquired
Transfer Restricted Securities from such Holder.

     (g) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

     (h) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.

     (i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICT OF LAW RULES THEREOF.



                                      -20-


     (j) Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.

     (k) Entire Agreement. This Agreement together with the other Operative
Documents (as defined in the Purchase Agreement) is intended by the parties as a
final expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted by the Issuer with respect to
the Transfer Restricted Securities. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.




                                      -21-



     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.

                                            VAIL RESORTS, INC.


                                            By: /s/ James P. Donohue
                                                -------------------------------
                                                Name:   James P. Donohue
                                                Title:  Senior Vice President
































                [Registration Rights Signature Page for Company]



                                      -22-



                         BEAVER CREEK ASSOCIATES, INC.
                         BEAVER CREEK CONSULTANTS, INC.
                         BEAVER CREEK FOOD SERVICES, INC.
                         BRECKENRIDGE RESORT PROPERTIES, INC.
                         COMPLETE TELECOMMUNICATIONS, INC.
                         GHTV, INC.
                         GILLETT BROADCASTING, INC.
                         GRAND TETON LODGE COMPANY
                         JACKSON HOLE GOLF AND TENNIS CLUB, INC.
                         JHL&S LLC
                         KEYSTONE CONFERENCE SERVICES, INC.
                         KEYSTONE DEVELOPMENT SALES, INC.
                         KEYSTONE FOOD AND BEVERAGE COMPANY
                         KEYSTONE RESORT PROPERTY MANAGEMENT COMPANY
                         LARKSPUR RESTAURANT & BAR, LLC
                         LODGE PROPERTIES, INC.
                         LODGE REALTY, INC.
                         PROPERTY MANAGEMENT ACQUISITION CORP., INC.
                         TETON HOSPITALITY LLC
                         TETON HOSPITALITY SERVICES, INC.
                         THE VAIL CORPORATION
                         THE VILLAGE AT BRECKENRIDGE ACQUISITION CORP., INC.
                         VAIL ASSOCIATES CONSULTANTS, INC.
                         VAIL ASSOCIATES HOLDINGS, LTD.
                         VAIL ASSOCIATES MANAGEMENT COMPANY
                         VAIL ASSOCIATES REAL ESTATE, INC.
                         VAIL FOOD SERVICES, INC.
                         VAIL HOLDINGS, INC.
                         VAIL RESORTS DEVELOPMENT COMPANY
                         VAIL SUMMIT RESORTS, INC.
                         VAIL TRADEMARKS, INC.
                         VAIL/ARROWHEAD, INC.
                         VAIL/BATTLE MOUNTAIN, INC.
                         VAIL/BEAVER CREEK RESORT PROPERTIES, INC.
                         VAMHC, INC.
                         VAIL RR, INC.
                         VA RANCHO MIRAGE I, INC.
                         VA RANCHO MIRAGE II, INC.

                         Each by its authorized officer or signatory

                         By: /s/ James P. Donohue
                             -------------------------------
                             Name:   James P. Donohue
                             Title:  Senior Vice President

          [Registration Rights Agreement Signature Page for Guarantors]



                                      -23-



The foregoing Registration Rights Agreement is hereby confirmed and accepted as
of the date first above written.

DEUTSCHE BANC ALEX. BROWN INC.


By:  /s/ Scott Tolchin
     --------------------------------
     Name:   Scott Tolchin
     Title:  Managing Director

BANC OF AMERICA SECURITIES LLC


By:  /s/ Diane Scott
     --------------------------------
     Name:   Diane Scott
     Title:  Vice President


BEAR, STEARNS & CO. INC.


By:  /s/ John Kilgallon
     --------------------------------
     Name:   John Kilgallon
     Title:  SMD


CIBC WORLD MARKETS CORP.


By:  /s/ Brian Perman
     --------------------------------
     Name:   Brian Perman
     Title:  Managing Director


FLEET SECURITIES, INC.


By:  /s/ Brad Stewart
     --------------------------------
     Name:   Brad Stewart
     Title:  Vice President



      [Registration Rights Agreement Signature Page for Initial Purchasers]



                                      -24-

                                                                     Exhibit 5.1


                    (LETTERHEAD OF CAHILL GORDON & REINDEL)













                                                                January 18, 2002






VAIL RESORTS, INC.
137 Benchmark Road
Avon, Colorado 81620

             Re:      8 3/4% Senior Subordinated Notes due 2009 of Vail
                      Resorts, Inc. and related Guarantees

Ladies and Gentlemen:

     We have acted as counsel for Vail Resorts, Inc. (the "Company"), GHTV,
Inc., Gillett Broadcasting, Inc., Rockresorts LLC, Rockresorts Casa Madrona,
LLC, Rockresorts Cheeca, LLC, Rockresorts International, LLC, Rockresorts
LaPosada, LLC, Rockresorts Rosario, LLC, and VA Rancho Mirage Resort, L.P.
(collectively, the "Delaware Guarantors" and, together with Company, the
"Delaware Issuers") in connection with the Registration Statement on Form S-4
(the "Registration Statement") filed by the Company, the Delaware Guarantors and
the other subsidiaries of the Company named therein as guarantors (the
"Additional Guarantors" and together with the Delaware Guarantors, the
"Guarantors") with the Securities and Exchange Commission (the "Commission") for
registration under the Securities Act of 1933, as amended (the "Act"), of (i)
$160,000,000 aggregate principal amount of 8 3/4% Senior Subordinated Notes due
2009 of the Company (the "Exchange Notes") and (ii) the unconditional guarantee
of the Exchange Notes (the "Guarantees," and together with the Exchange Notes,
the "Securities") by each of the Guarantors. The Securities will be issued
pursuant to an indenture dated as of November 21, 2001 (as supplemented by the
First Supplemental Indenture dated as of January 16, 2002, the "Indenture"),
among the Company, the Guarantors and The Bank of New York, as trustee, in
connection with the exchange offer set forth in the Registration Statement (the
"Exchange Offer") pursuant to which the Securi-





     ties will be issued for a like principal amount of the Company's
     outstanding 8 3/4% Senior Subordinated Notes due 2009. Capitalized terms
     used and not otherwise defined herein shall have the meanings ascribed to
     such terms in the Registration Statement.

     In connection therewith, we have examined, among other things, originals or
copies, certified or otherwise identified to our satisfaction, of the
Certificates of Incorporation of the Delaware Issuers, resolutions of the Boards
of Directors of the Delaware Issuers with respect to the filing of the
Registration Statement and such other documents as we have deemed necessary or
appropriate for the purpose of rendering this opinion.

     In our examination of documents, instruments and other papers, we have
assumed the genuineness of all signatures on original and certified documents
and the conformity to original and certified documents of all copies submitted
to us as conformed, photostatic or other copies. As to matters of fact, we have
relied upon representations of officers of the Delaware Issuers.

     Based upon the foregoing, and subject to the qualifications stated herein,
it is our opinion that:

     1. The Exchange Notes have been duly authorized by all necessary corporate
action on the part of the Company and, when executed and delivered in accordance
with the provisions of the Indenture and the Exchange Offer (assuming due
authorization, execution and delivery of the Indenture by the Trustee and due
authentication and delivery of the Exchange Notes by the Trustee in accordance
with the Indenture), will be entitled to the benefits of the Indenture and will
be legal, valid and binding obligations of the Company enforceable against the
Company in accordance with their terms, (x) subject to (A) applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws now or hereafter in effect affecting creditors' rights and
remedies generally and (B) general principles of equity, including principles of
commercial reasonableness, good faith and fair dealing (regardless of whether
enforcement is sought in a proceeding at law or in equity) and (y) except that
the waiver contained in Section 4.07 of the Indenture may be deemed
unenforceable.

     2 The guarantees of the Exchange Notes have been duly, authorized by each
of the Delaware Guarantors and, when issued and delivered by such Delaware
Guarantors and upon the due authentication and issuance of the Exchange Notes in
accordance with the Indenture and the Exchange Offer (assuming due
authorization, execution and delivery of the Indenture by the Trustee and due
authentication and delivery of the Exchange Notes by the Trustee in accordance
with the Indenture), will be legal, valid and binding obligations of the
Delaware Guarantors, enforceable against each of the Delaware Guarantors in
accordance with their terms, (x) subject to (A) applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other similar
laws now or hereafter in effect affecting creditors' rights and remedies
generally and (B) general principles of equity, including principles of
commercial reasonableness, good faith and fair dealing (regardless of whether
enforcement is


                                      -2-


sought in a proceeding at law or in equity) and (y) except that the waiver
contained in Section 4.07 of the Indenture may be deemed unenforceable.

     We are attorneys admitted to practice in the State of New York. We express
no opinion concerning the laws of any jurisdiction other than the laws of the
State of New York, the Delaware General Corporation Law and the Federal laws of
the United States of America.

     We hereby consent to the reference to our firm in the Registration
Statement under the caption "Legal Matters," and to the inclusion of this
opinion as an exhibit to the Registration Statement. Our consent to such
reference does not constitute a consent pursuant to Section 7(a) of the
Securities Act and in consenting to such reference we have not certified any
part of the Registration Statement and do not otherwise come within the
categories of persons whose consent is required under Section 7(a) or under the
rules and regulations of the Commission thereunder.

                                            Very truly yours,


                                            /s/ Cahill Gordon & Reindel
                                            -------------------------------
                                            Cahill Gordon & Reindel



                                      -3-

                                                                     Exhibit 5.2





                       [Letterhead of Vail Resorts, Inc.]







                                                              January 18, 2002



VAIL RESORTS, INC.
137 Benchmark Road
Avon, Colorado 81620

         Re:  8 3/4% Senior Subordinated Notes due 2009 of Vail Resorts, Inc
              and related Guarantees
              --------------------------------------------------------------

Ladies and Gentlemen:

     I am General Counsel for Vail Resorts, Inc. (the "Company") and the
guarantors listed on Exhibit I hereto (collectively, the "Guarantors" and,
together with Company, the "Issuers") in connection with the Registration
Statement on Form S-4 (the "Registration Statement") filed by, among others, the
Company and the Guarantors with the Securities and Exchange Commission (the
"Commission") for registration under the Securities Act of 1933, as amended (the
"Act"), of (i) up to $160,000,000 aggregate principal amount of 8 3/4% Senior
Subordinated Notes due 2009 of the Company (the "Exchange Notes"), and (ii) the
Guarantors' unconditional guarantee of the Exchange Notes (the "Guarantees," and
together with the Exchange Notes, the "Securities"). The Securities will be
issued pursuant to an indenture dated as of November 21, 2001 (the "Indenture"),
between the Company, the Guarantors. and The Bank of New York, as trustee, in
connection with the exchange offer (the "Exchange Offer") pursuant to which the
Securities will be issued for a like principal amount of the Company's
outstanding 8 3/4% Senior Subordinated Notes due 2009. Capitalized terms used
and not otherwise defined herein shall have the meanings ascribed to such terms
in the Registration Statement.

     In connection therewith, I have examined, among other things, originals or
copies, certified or otherwise identified to my satisfaction, of the
Certificates of Incorporation of the Issuers, resolutions of the Boards of
Directors of the Issuers with respect to the filing of the Registration
Statement and such other documents as I have deemed necessary or appropriate for
the purpose of rendering this opinion.

     In my examination of documents, instruments and other papers, I have
assumed the genuineness of all signatures on original and certified documents
and the conformity to original and certified documents of all copies submitted
to me as conformed, photo-




static or other copies. As to matters of fact, I have relied upon
representations of officers of the Issuers.

     I am admitted to the Bar of the State of Colorado. I express no opinion as
to the laws of any jurisdiction other than the laws of the State of Colorado and
the Federal laws of the United States of America. With respect to The Village at
Breckenridge Acquisition Corp., Inc. and Property Management Acquisition Corp.,
Inc., for all purposes hereunder I have assumed that Tennessee law is identical
to Colorado law. With respect to Rockresorts Equinox, Inc., for all purposes
hereunder I have assumed that Vermont law is identical to Colorado law. With
respect to Grand Teton Lodge Company, Jackson Hole Golf and Tennis Club, Inc.,
JHL&S LLC and Teton Hospitality Services, Inc., for all purposes hereunder I
have assumed that Wyoming law is identical to Colorado law.

     Based upon the foregoing, and subject to the qualifications stated herein,
it is our opinion that:

     (i) The Exchange Notes have been duly authorized for issuance by the
Company and, when duly executed, authenticated and delivered in exchange for the
Initial Notes in accordance with the terms of the Exchange Offer and the
Indenture as contemplated by the Registration Statement, will constitute valid
and legally binding obligations of the Company, entitled to the benefits of the
Indenture and enforceable against the Company in accordance with their terms
except that the enforcement thereof may be subject to (i) bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium or other similar
laws now or hereafter in effect relating to creditors' rights generally and (ii)
general principles of equity and the discretion of the court before which any
proceeding therefor may be brought.

     (ii) The Guarantees of the Guarantors have been duly authorized by the
Guarantors and, when the Exchange Notes have been duly executed, authenticated
and delivered in accordance with the terms of the Exchange Offer and the
Indenture as contemplated by the Registration Statement and the Guarantees of
the Guarantors have been duly executed and delivered, the Guarantees of the
Guarantors will constitute valid and legally binding obligations of the
Guarantors, entitled to the benefits of the Indenture and enforceable against
the Guarantors in accordance with their terms except that the enforcement
thereof may be subject to (i) bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws now or hereafter in effect relating
to creditors' rights generally and (ii) general principles of equity and the
discretion of the court before which any proceeding therefor may be brought.

     I hereby consent to any reference required by law to the undersigned as the
Company's general or legal counsel in the Registration Statement under the
caption "Legal Matters," and to the inclusion of this opinion as an exhibit to
the Registration Statement. My consent to such reference does not constitute a
consent under Section 7 of the Securities Act and in consenting to such
reference I have not certified any part of the Registration Statement

                                      -2-


and do not otherwise come within the categories of persons whose consent is
required under Section 7 or under the rules and regulations of the Commission
thereunder.

                                                     Very truly yours,

                                                     /s/ Martha Dugan Rehm








                                      -3-




                                    EXHIBIT I


           Beaver Creek Associates, Inc.
           Beaver Creek Consultants, Inc.
           Beaver Creek Food Services, Inc.
           Breckenridge Resort Properties, Inc.
           Complete Telecommunications, Inc.
           Grand Teton Lodge Company
           Jackson Hole Golf and Tennis Club, Inc.
           JHL&S LLC
           Keystone Conference Services, Inc.
           Keystone Development Sales, Inc.
           Keystone Food and Beverage Company
           Keystone Resort Property Management Company
           Larkspur Restaurant & Bar, LLC
           Lodge Properties, Inc.
           Lodge Realty, Inc.
           Property Management Acquisition Corp., Inc.
           Rockresorts LLC
           Rockresorts Casa Madrona, LLC
           Rockresorts Cheeca, LLC
           Rockresorts Equinox, Inc.
           Rockresorts International, LLC
           Rockresorts LaPosada, LLC
           Rockresorts Rosario, LLC
           Teton Hospitality LLC
           Teton Hospitality Services, Inc.
           The Vail Corporation
           The Village at Breckenridge Acquisition Corp., Inc.
           Vail Associates Consultants, Inc.
           Vail Associated Holdings, Ltd.
           Vail Associates Management Company
           Vail Associates Real Estate, Inc.
           Vail Food Services, Inc.
           Vail Holdings, Inc.
           Vail Resorts Development Company
           Vail Summit Resorts, Inc.
           Vail Trademarks, Inc.
           Vail/Arrowhead, Inc.
           Vail/Battle Mountain, Inc.


                                      -4-


           Vail/Beaver Creek Resort Properties, Inc.
           VAMHC, Inc.
           Vail RR, Inc.
           VA Rancho Mirage I, Inc.
           VA Rancho Mirage II, Inc.












                                      -5-


                                                                    EXHIBIT 12.1


Vail Resorts, Inc. Computation of Ratio of Earnings to Fixed Charges Pro Forma Fiscal Fiscal Fiscal Year Ten Months Year Ended Ended Ended July 31, Fiscal Year Ended July 31, July 31, September 30, 2001 2001 2000 1999 1998 1997 ----------- ----------- ----------- ----------- ----------- ------------- Fixed charges: Interest on long-term debt 40,298 32,034 35,108 25,099 17,789 20,308 Capitalized interest 1,300 1,300 1,100 200 -- -- Interest component of rental expense 7,626 7,626 6,693 3,830 449 435 ----------- ----------- ----------- ----------- ----------- ------------- Total 49,224 40,960 42,901 29,129 18,238 20,743 =========== =========== =========== =========== =========== ============= Earnings (before fixed charges and income taxes): Income before income taxes 24,716 32,980 27,195 20,794 70,164 33,683 Fixed Charges as above 47,924 39,660 41,801 28,929 18,238 20,743 ----------- ----------- ----------- ----------- ----------- ------------- Total 72,640 72,640 68,996 49,723 88,402 54,426 =========== =========== =========== =========== =========== ============= Ratio of earnings to fixed charges 1.48 1.77 1.61 1.71 4.85 2.62
                                                                    Exhibit 23.1



                    CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS


As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement on Form S-4 of our report dated
September 7, 2001 included in Vail Resorts, Inc.'s Form 10-K for the year ended
July 31, 2001 and to all references to our Firm included in this Registration
Statement.


ARTHUR ANDERSEN LLP

Denver, Colorado,
   January 17, 2002.





                                                                    Exhibit 25.1


                                    FORM T-1

================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                               ------------------

                            STATEMENT OF ELIGIBILITY
                    UNDER THE TRUST INDENTURE ACT OF 1939 OF
                   A CORPORATION DESIGNATED TO ACT AS TRUSTEE
                               ------------------

                      CHECK IF AN APPLICATION TO DETERMINE
                      ELIGIBILITY OF A TRUSTEE PURSUANT TO
                            SECTION 305(b)(2) _______

                               ------------------

                              THE BANK OF NEW YORK
               (Exact name of trustee as specified in its charter)

                New York                               13-5160382
         (State of incorporation                    (I.R.S. employer
         if not a national bank)                   identification no.)

     One Wall Street, New York, N.Y.                      10286
(Address of principal executive offices)               (Zip Code)

                               ------------------

                               Vail Resorts, Inc.
            (Exact name of each obligor as specified in its charter)

                Delaware                               51-0291762
     (State or other jurisdiction of                (I.R.S. Employer
     incorporation or organization)                Identification No.)

                               ------------------




                                      -2-

                          Beaver Creek Associates, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                          84-0677537
 (State or other jurisdiction of                           (I.R.S. Employer
 incorporation or organization)                           Identification No.)

                               ------------------

                         Beaver Creek Consultants, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                         84-0760348
 (State or other jurisdiction of                          (I.R.S. Employer
 incorporation or organization)                          Identification No.)

                               ------------------

                        Beaver Creek Food Services, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                         84-0815288
 (State or other jurisdiction of                          (I.R.S. Employer
 incorporation or organization)                          Identification No.)

                               ------------------

                      Breckenridge Resort Properties, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                             N/A
 (State or other jurisdiction of                          (I.R.S. Employer
 incorporation or organization)                          Identification No.)

                               ------------------

                        Complete Telecommunications, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                        84-1533678
 (State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)



                                      -3-


                               ------------------

                                   GHTV, Inc.
            (Exact name of each obligor as specified in its charter)

            Delaware                                        39-1284459
 (State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)

                               ------------------

                           Gillett Broadcasting, Inc.
            (Exact name of each obligor as specified in its charter)

            Delaware                                        37-0920781
 (State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)

                               ------------------

                            Grand Teton Lodge Company
            (Exact name of each obligor as specified in its charter)

             Wyoming                                        83-0161154
 (State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)

                               ------------------

                     Jackson Hole Golf and Tennis Club, Inc.
            (Exact name of each obligor as specified in its charter)

             Wyoming                                            N/A
 (State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)

                               ------------------




                                      -4-



                                    JHL&S LLC
            (Exact name of each obligor as specified in its charter)

            Wyoming                                         83-0332983
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                       Keystone Conference Services, Inc.
            (Exact name of each obligor as specified in its charter)

           Colorado                                         84-1075280
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                        Keystone Development Sales, Inc.
            (Exact name of each obligor as specified in its charter)

           Colorado                                         43-1463384
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                       Keystone Food and Beverage Company
            (Exact name of each obligor as specified in its charter)

           Colorado                                         84-0678950
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                   Keystone Resort Property Management Company
            (Exact name of each obligor as specified in its charter)

           Colorado                                         84-0705922
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)



                                      -5-


                               ------------------

                         Larkspur Restaurant & Bar, LLC
            (Exact name of each obligor as specified in its charter)

           Colorado                                         84-1510919
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                             Lodge Properties, Inc.
            (Exact name of each obligor as specified in its charter)

           Colorado                                         84-0607010
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                               Lodge Realty, Inc.
            (Exact name of each obligor as specified in its charter)

           Colorado                                         13-3051423
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                   Property Management Acquisition Corp., Inc.
            (Exact name of each obligor as specified in its charter)

           Tennessee                                        62-1634422
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------




                                      -6-



                          Rockresorts Casa Madrona, LLC
            (Exact name of each obligor as specified in its charter)

           Delaware                                         84-1606603
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                             Rockresorts Cheeca, LLC
           (Exact name of each obligor as specified in its charter)

          Delaware                                         84-1606605
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                            Rockresorts Equinox, Inc.
            (Exact name of each obligor as specified in its charter)

            Vermont                                         06-1634157
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                         Rockresorts International, LLC
            (Exact name of each obligor as specified in its charter)

           Delaware                                         84-1606606
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                            Rockresorts LaPosada, LLC
            (Exact name of each obligor as specified in its charter)

           Delaware                                         84-1606604
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)



                                      -7-


                               ------------------

                                 Rockresorts LLC
            (Exact name of each obligor as specified in its charter)

           Delaware                                         75-2829919
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                            Rockresorts Rosario, LLC
            (Exact name of each obligor as specified in its charter)

           Delaware                                         84-1606602
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                              Teton Hospitality LLC
            (Exact name of each obligor as specified in its charter)

            Wyoming                                         83-0332997
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                        Teton Hospitality Services, Inc.
            (Exact name of each obligor as specified in its charter)

            Wyoming                                         83-0332998
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------




                                      -8-



                              The Vail Corporation
            (Exact name of each obligor as specified in its charter)

           Colorado                                         84-0601461
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

               The Village at Breckenridge Acquisition Corp., Inc.
            (Exact name of each obligor as specified in its charter)

           Tennessee                                        62-1633660
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                        Vail Associates Consultants, Inc.
            (Exact name of each obligor as specified in its charter)

           Colorado                                         84-0738502
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                         Vail Associated Holdings, Ltd.
            (Exact name of each obligor as specified in its charter)

            Colorado                                         84-1214955
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)

                               ------------------

                       Vail Associates Management Company
            (Exact name of each obligor as specified in its charter)

           Colorado                                         84-1248614
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                          Identification No.)



                                      -9-


                               ------------------

                        Vail Associates Real Estate, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                        84-1013094
 (State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)

                               ------------------

                            Vail Food Services, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                        84-0596378
 (State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)

                               ------------------

                               Vail Holdings, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                        84-0568230
 (State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)

                               ------------------

                        Vail Resorts Development Company
            (Exact name of each obligor as specified in its charter)

            Colorado                                        84-1242948
 (State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)

                               ------------------


                                      -10-


                            Vail Summit Resorts, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                         43-1273996
 (State or other jurisdiction of                          (I.R.S. Employer
 incorporation or organization)                          Identification No.)

                               ------------------

                              Vail Trademarks, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                         84-1253320
 (State or other jurisdiction of                          (I.R.S. Employer
 incorporation or organization)                          Identification No.)

                               ------------------

                              Vail/Arrowhead, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                         84-1253319
 (State or other jurisdiction of                          (I.R.S. Employer
 incorporation or organization)                          Identification No.)

                               ------------------

                           Vail/Battle Mountain, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                         84-1146997
 (State or other jurisdiction of                          (I.R.S. Employer
 incorporation or organization)                          Identification No.)

                               ------------------

                    Vail/Beaver Creek Resort Properties, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                       52-1479879
 (State or other jurisdiction of                        (I.R.S. Employer
 incorporation or organization)                        Identification No.)



                                      -11-


                               ------------------

                                   VAMHC, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                            N/A
 (State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)

                               ------------------

                                  Vail RR, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                       84-1606210
 (State or other jurisdiction of                        (I.R.S. Employer
 incorporation or organization)                        Identification No.)

                               ------------------

                            VA Rancho Mirage I, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                       84-1606209
 (State or other jurisdiction of                        (I.R.S. Employer
 incorporation or organization)                        Identification No.)

                               ------------------

                            VA Rancho Mirage II, Inc.
            (Exact name of each obligor as specified in its charter)

            Colorado                                       84-1606208
 (State or other jurisdiction of                        (I.R.S. Employer
 incorporation or organization)                        Identification No.)

                               ------------------




                                      -12-


                          VA Rancho Mirage Resort, L.P.
            (Exact name of each obligor as specified in its charter)

           Delaware                                        78-2578150
(State or other jurisdiction of                         (I.R.S. Employer
incorporation or organization)                         Identification No.)

      137 Benchmark Road                                      81620
        Avon, Colorado                                     (Zip Code)
        (970) 845-2500

     (Address and telephone number of obligor's principal executive offices)


                               ------------------

                    8 3/4% Senior Subordinated Notes due 2009
                       (Title of the indenture securities)



================================================================================




                                      -13-




1.   General information. Furnish the following information as to the Trustee:

     (a)  Name and address of each examining or supervising authority to which
          it is subject.

- --------------------------------------------- ----------------------------------
Name                                          Address
- --------------------------------------------- ----------------------------------

Superintendent of Banks of the                2 Rector Street,
State of New York                             New York, N.Y. 10006, and
                                              Albany, N.Y. 12203

Federal Reserve Bank of New York              33 Liberty Plaza,
                                              New York, N.Y.  10045
Federal Deposit Insurance Corporation         Washington, D.C.  20429
New York Clearing House Association           New York, New York 10005

     (b)  Whether it is authorized to exercise corporate trust powers.

     Yes.

2.   Affiliations with the Obligor.

     If the obligor is an affiliate of the trustee, describe each such
affiliation.

     None

16.  List of Exhibits.

     Exhibits identified in parentheses below, on file with the Commission, are
     incorporated herein by reference as an exhibit hereto, pursuant to Rule
     7a-29 under the Trust Indenture Act of 1939 and rule 24 of the Commission's
     Rules of Practice.

     1.   A copy of the Organization Certificate of The Bank of New York
          (formerly Irving Trust Company) as now in effect, which contains the
          authority to commence business and a grant of powers to exercise
          corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1,
          filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
          Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
          to Form T-1 filed with Registration Statement No. 33-29637.)



                                      -14-


     4.   A copy of the existing By-Laws of the Trustee. (Exhibit 4 to Form T-1
          filed with Registration Statement No. 33-31019).

     6.   The consent of the Trustee required by Section 321(b) of the Act.
          (Exhibit 6 to Form T-1 filed with Registration Statement No.
          33-44051.)

     7.   A copy of the latest report of condition of the Trustee published
          pursuant to law or to the requirements of its supervising or examining
          authority.

                                    SIGNATURE


Pursuant to the requirements of the Trust Indenture Act of 1939, the Trustee,
The Bank of New York, a corporation organized and existing under the laws of the
State of New York, has duly caused this statement of eligibility to be signed on
its behalf by the undersigned, thereunto duly authorized, all in the City of New
York, and State of New York, on the 15th day of January, 2002.

                                    THE BANK OF NEW YORK



                                    By:      /s/Cynthia Chaney
                                             -----------------------------------
                                             Cynthia Chaney
                                             Authorized Signer
                                             Attorney-in-Fact
CC/pg
(rev:kk)






                                                                       EXHIBIT 7

- --------------------------------------------------------------------------------

                       Consolidated Report of Condition of

                              THE BANK OF NEW YORK
                    of One Wall Street, New York, N.Y. 10286
                     And Foreign and Domestic Subsidiaries,

a member of the Federal Reserve System, at the close of business September 30,
2001, published in accordance with a call made by the Federal Reserve Bank of
this District pursuant to the provisions of the Federal Reserve Act.

                                                                Dollar Amounts
                                                                 in Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and                                    $3,238,092
     currency and coin...............................
Interest-bearing balances............................                5,255,952
Securities:
Held-to-maturity securities..........................                  127,193
Available-for-sale securities........................               12,143,488
Federal funds sold and Securities
     purchased under agreements to resell............                  281,677
Loans and lease financing receivables:
    Loans and leases held for sale...................                      786
    Loans and leases, net of unearned
          income.....................................               46,206,726
    LESS: Allowance for loan and
          lease losses...............................                  607,115
    Loans and leases, net of unearned
          income and allowance.......................               45,599,611
Trading Assets.......................................                9,074,924
Premises and fixed assets (including
     capitalized leases).............................                  783,165
Other real estate owned..............................                      935
Investments in unconsolidated
     subsidiaries and associated companies...........                  200,944
subsidiaries and associated companies................


                                      -16-


Customers' liability to this bank on                                   311,521
     acceptances outstanding.........................
     Intangible assets...............................
     Goodwill........................................                1,546,125
Other intangible assets..............................                    8,497
Other assets.........................................                8,761,129
                                                                    ----------
Total assets.........................................              $87,334,039
                                                                    ==========

LIABILITIES
Deposits:
     In domestic offices.............................              $28,254,986
     Noninterest-bearing.............................               10,843,829
     Interest-bearing................................               17,411,157
     In foreign offices, Edge and Agreement
          subsidiaries, and IBFs.....................               31,999,406
     Noninterest-bearing.............................                1,006,193
     Interest-bearing................................               30,993,213
Federal funds purchased and securities
     sold under agreements to repurchase.............                6,004,678
Trading liabilities..................................                2,286,940
Other borrowed money:
(includes mortgage indebtedness and
     obligations under capitalized leaes)............                1,845,865
Bank's liability on acceptances executed
     and outstanding.................................                  440,362
Subordinated notes and debentures....................                2,196,000
Other liabilities....................................                7,607,267
                                                                    ----------
Total liabilities....................................              $80,635,504
                                                                    ==========

EQUITY CAPITAL
Common stock.........................................                1,135,284
Surplus..............................................                1,050,729
Retained earnings....................................                4,436,230
Accumulated other comprehensive
     income..........................................                   76,292
Other equity capital components......................                        0
- --------------------------------------------------------------------------------
Total equity capital.................................                6,698,535
                                                                    ----------
Total liabilities and equity capital.................              $87,334,039
                                                                    ==========


                                      -17-


     I, Thomas J. Mastro, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.

                                                            Thomas J. Mastro,



                                        Senior Vice President and Comptroller



     We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.

Thomas A. Renyi
Gerald L. Hassell                                          Directors
Alan R. Griffith