Document:

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                                                                    Exhibit 4.23
                                                                   ANNEX IV
                                                                      TO
                                                                 SUBSCRIPTION
                                                                   AGREEMENT

                          REGISTRATION RIGHTS AGREEMENT

     THIS REGISTRATION RIGHTS AGREEMENT, dated as of December 7, 1999 (this
"Agreement"), is made by and between RMI.NET, INC., a Delaware corporation (the
"Company"), and the person named on the signature page hereto (the "Initial
Investor").

                              W I T N E S S E T H:

     WHEREAS, in connection with the Subscription Agreement, dated as of
December 7, 1999, between the Initial Investor and the Company (the
"Subscription Agreement"), the Company has agreed, upon the terms and subject to
the conditions of the Subscription Agreement, to issue and sell to the Initial
Investor shares (the "Common Shares") of Common Stock, $.001 par value (the
"Common Stock"), of the Company, and to issue Common Stock Purchase Warrants,
Class A and Common Stock Purchase Warrants, Class B (collectively, the
"Warrants") to purchase shares (the "Warrant Shares") of Common Stock; and

     WHEREAS, to induce the Initial Investor to execute and deliver the
Subscription Agreement, the Company has agreed to provide certain registration
rights under the Securities Act of 1933, as amended, and the rules and
regulations thereunder, or any similar successor statute (collectively, the
"1933 Act"), and applicable state securities laws with respect to the Common
Shares and the Warrant Shares;

     NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Initial
Investor hereby agree as follows:

     1. DEFINITIONS.

     (a) As used in this Agreement, the following terms shall have the following
meanings:

     "Investor" or "Investors" means the Initial Investor and any transferee or
assignee who agrees to become bound by the provisions of this Agreement in
accordance with Section 9 hereof.

     "Majority Holders" means those Investors who hold a majority in interest of
the Registrable Securities, the Warrants and the "Registrable Securities" and
"Warrants" as such terms are defined in the Other Registration Rights Agreement.

     "Nasdaq" means the Nasdaq National Market.

     "1934 Act" means the Securities Exchange Act of 1934, as amended.

     "Other Registration Rights Agreement" means the Registration Rights
Agreement entered into in connection with the Other Subscription Agreement.

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     "Permitted Transferee" means any person (1) who is an "accredited investor"
as defined in Regulation D under the 1933 Act, (2) who is not a Restricted
Person named in a Restricted Person Resolution delivered to an Investor in
accordance with Section 4(a)(2) of the Subscription Agreement and (3) who,
immediately following the assignment of rights under this Agreement holds (x) at
least 50,000 shares of Common Stock or (y) Warrants which at the time of such
transfer are exercisable for at least 50,000 shares of Common Stock, or any
combination thereof (the 50,000 share amounts referred to in this definition
being subject to equitable adjustment from time to time on terms reasonably
acceptable to the Majority Holders for (i) stock splits, (ii) stock dividends,
(iii) combinations, (iv) capital reorganizations, (v) issuance to all holders of
Common Stock of rights or warrants to purchase shares of Common Stock and (vi)
similar events relating to the Common Stock, in each such case which occur on or
after the Closing Date).

     "register," "registered," and "registration" refer to a registration
effected by preparing and filing a Registration Statement or Statements in
compliance with the 1933 Act and pursuant to Rule 415 under the 1933 Act or any
successor rule providing for offering securities on a continuous basis ("Rule
415"), and the declaration or ordering of effectiveness of such Registration
Statement by the SEC.

     "Registrable Securities" means the Common Shares and the Warrant Shares. As
to any particular securities, such securities shall cease to be Registrable
Securities when they have been sold pursuant to an effective registration
statement or in compliance with Rule 144 or are eligible to be sold pursuant to
subsection (k) of Rule 144.

     "Registration Period" means the period from the Closing Date to the earlier
of (i) the date which is five years after the SEC Effective Date, (ii) the date
on which each Investor may sell all of its Registrable Securities without
registration under the 1933 Act pursuant to subsection (k) of Rule 144, without
restriction on the manner of sale or the volume of securities which may be sold
in any period and without the requirement for the giving of any notice to, or
the making of any filing with, the SEC and (iii) the date on which the Investors
no longer beneficially own any Registrable Securities.

     "Registration Statement" means a registration statement of the Company
under the 1933 Act, including any amendment thereto, required to be filed by the
Company pursuant to this Agreement.

     "Rule 144" means Rule 144 promulgated under the 1933 Act or any other
similar rule or regulation of the SEC that may at any time permit a holder of
any securities to sell securities of the Company to the public without
registration under the 1933 Act.

     "SEC" means the United States Securities and Exchange Commission.

     "SEC Effective Date" means the date the Registration Statement is declared
effective by the SEC.

     "SEC Filing Date" means the date the Registration Statement is first filed
with the SEC pursuant to Section 2(a).

     (b) Capitalized terms defined in the introductory paragraph or the recitals
to this Agreement shall have the respective meanings therein provided.
Capitalized terms used herein and not otherwise defined herein shall have the
respective meanings set forth in the Subscription Agreement.

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     2. REGISTRATION.

     (a) MANDATORY REGISTRATION. (1) The Company shall prepare and, on or prior
to the date which is 45 days after the Closing Date, file with the SEC a
Registration Statement on Form S-3 which, on the date of filing with the SEC,
covers the resale by the Initial Investor of a number of shares of Common Stock
at least equal to the sum of (x) the number of Common Shares plus (y) the number
of Warrant Shares issuable upon the exercise in full of the Class A Warrants
plus (z) the number of Warrant Shares equal to 175% of the number of shares of
Common Stock issuable upon the exercise of the Class B Warrants, determined as
if the First Adjustment Date (as defined in the Class B Warrants) occurred and
the Class B Warrants were otherwise exercised in full for cash in accordance
with the terms thereof on the Trading Day prior to the SEC Filing Date (in each
case determined without regard to the limitations on beneficial ownership
contained in Section 1.1(b) of the Warrants). If at any time the number of
shares of Common Stock included in the Registration Statement required to be
filed as provided in the first sentence of this Section 2(a) shall be
insufficient to cover 100% of the number of Warrant Shares issuable upon
exercise of the unexercised portion of the Warrants, then promptly, but in no
event later than 20 days after such insufficiency shall occur, the Company shall
file with the SEC an additional Registration Statement on Form S-3 (which shall
not constitute a post-effective amendment to the Registration Statement filed
pursuant to the first sentence of this Section 2(a)), covering such number of
shares of Common Stock as shall be sufficient to permit such exercise. For all
purposes of this Agreement such additional Registration Statement shall be
deemed to be the Registration Statement required to be filed by the Company
pursuant to Section 2(a) of this Agreement, and the Company and the Investors
shall have the same rights and obligations with respect to such additional
Registration Statement as they shall have with respect to the initial
Registration Statement required to be filed by the Company pursuant to this
Section 2(a). The Registration Statement shall not include securities to be sold
for the account of any selling security holder other than the Investors and the
investors contemplated by the Other Registration Rights Agreement.

     (2) Prior to the SEC Effective Date or during any time subsequent to the
SEC Effective Date when the Registration Statement for any reason is not
available for use by any Investor for the resale of any Registrable Securities,
the Company shall not file any other registration statement or any amendment
thereto with the SEC under the 1933 Act or request the acceleration of the
effectiveness of any other registration statement previously filed with the SEC,
other than any registration statement registering securities issued (w) pursuant
to compensation plans for employees, directors, officers, advisers or
consultants of the Company and in accordance with the terms of such plans as in
effect as of the date of this Agreement, (x) upon exercise of conversion,
exchange, purchase or similar rights issued, granted or given by the Company and
outstanding as of the date of this Agreement and disclosed in the SEC Reports or
the Subscription Agreement, (y) pursuant to a public offering underwritten on a
firm commitment basis registered under the 1933 Act or (z) as part of a
transaction involving a strategic alliance, acquisition of stock or assets,
merger, collaboration, joint venture, partnership or other similar arrangement
of the Company with another corporation, partnership or other business entity
which is engaged in a business similar to or related to the business of the
Company, so long as in the case of this clause (z) the Board of Directors of the
Company by resolution duly adopted (and a copy of which shall be furnished to
the Investor promptly after adoption) determines that such issuance is fair to
the holders of each class and series of capital stock of the Company and to the
Investor in respect of its equity interest in the Company that is represented by
the Shares and the Warrants.

     (b) CERTAIN OFFERINGS. If any offering pursuant to a Registration Statement
pursuant to Section 2(a)(1) hereof involves an underwritten offering, Investors
who hold a majority in interest of the Registrable Securities subject to such
underwritten offering shall have the right to select one legal counsel and an
investment banker or bankers and manager or managers to administer the offering,
which investment banker or bankers or manager or managers shall be reasonably
satisfactory to the Company. The Investors who hold the Registrable Securities
to be included in such underwriting shall pay all underwriting discounts and
commissions and other fees and expenses of such investment banker or

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bankers and manager or managers so selected in accordance with this Section 2(b)
(other than fees and expenses relating to registration of Registrable Securities
under federal or state securities laws, which are payable by the Company
pursuant to Section 5 hereof) with respect to their Registrable Securities and
the fees and expenses of such legal counsel so selected by the Investors.

     (c) CERTAIN PAYMENTS. If for any reason the Registration Statement covering
at least the number of shares of Common Stock referred to in clauses (x) and (y)
of Section 2(a)(1) is not declared effective by the SEC on or before the date
which is 150 days after the Closing Date, the Company shall pay the Initial
Investor an amount in cash equal to 1.5% of the Purchase Price for the Common
Shares for each period of 30 days after such 150th day during which the
Registration Statement is not effective (such amount to be prorated for any
period of less than 30 days). Each such payment shall be made by the Company to
the Initial Investor at the end of each such 30-day period by wire transfer of
immediately available funds to such account as shall be specified by the Initial
Investor in writing to the Company at least one Business Day prior to the date
of each payment. Any such amount which is not paid when due shall bear interest
at the rate of 14% per annum (or such other rate as shall be the maximum rate
allowable by applicable law) until paid in full.

     (d) PIGGY-BACK REGISTRATIONS. If at any time the Company shall determine to
prepare and file with the SEC a registration statement relating to an offering
for its own account or the account of others under the 1933 Act of any of its
equity securities, other than a registration statement registering securities
issued (1) pursuant to compensation plans for employees, directors, officers,
advisers or consultants of the Company and in accordance with the terms of such
plans as in effect as of the date of the Agreement or (2) as part of a
transaction involving a strategic alliance, acquisition of stock or assets,
merger, collaboration, joint venture, partnership or other similar arrangement
of the Company with another corporation, partnership, or other business entity
which is engaged in a business similar to or related to the business of the
Company, so long as in the case of this clause (2) the Board of Directors of the
Company by resolution duly adopted (and a copy of which shall be furnished to
the Investor promptly after adoption) determines that such issuance is fair to
the holders of each class and series of capital stock of the Company and to the
Investor in respect of its equity interest in the Company that is represented by
the Shares and the Warrants, the Company shall send to each Investor who is
entitled to registration rights under this Section 2(d) written notice of such
determination and, if within ten days after receipt of such notice, such
Investor shall so request in writing, the Company shall include in such
Registration Statement all or any part of the Registrable Securities such
Investor requests to be registered, except that if, in connection with any
underwritten public offering for the account of the Company, the managing
underwriter(s) thereof shall impose a limitation on the number of shares of
Common Stock which may be included in the Registration Statement because, in
such underwriter(s)' judgment, such limitation is necessary to effect an orderly
public distribution, then the Company shall be obligated to include in such
Registration Statement only such limited portion of the Registrable Securities
with respect to which such Investor has requested inclusion hereunder. Any
exclusion of Registrable Securities shall be made pro rata among the Investors
seeking to include Registrable Securities, in proportion to the number of
Registrable Securities sought to be included by such Investors; provided,
however, that the Company shall not exclude any Registrable Securities unless
the Company has first excluded all outstanding securities the holders of which
are not entitled by right to inclusion of securities in such Registration
Statement; and provided further, however, that, after giving effect to the
immediately preceding proviso, any exclusion of Registrable Securities shall be
made pro rata with holders of other securities having the right to include such
securities in the Registration Statement, based on the number of securities for
which registration is requested except to the extent such pro rata exclusion of
such other securities is prohibited under any written agreement entered into by
the Company with the holder of such other securities prior to the date of this
Agreement, in which case such other securities shall be excluded, if at all, in
accordance with the terms of such agreement. No right to registration of
Registrable Securities under this Section 2(d) shall be construed to limit any
registration required under Section 2(a) hereof. The obligations of the

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Company under this Section 2(d) may be waived by the Majority Holders and shall
expire after the Company has afforded the opportunity for the Investors to
exercise registration rights under this Section 2(d) for two registrations;
provided, however, that any Investor who shall have had any Registrable
Securities excluded from any Registration Statement in accordance with this
Section 2(d) shall be entitled to include in an additional Registration
Statement filed by the Company the Registrable Securities so excluded.
Notwithstanding any other provision of this Agreement, if the Registration
Statement required to be filed pursuant to Section 2(a) of this Agreement shall
have been ordered effective by the SEC and the Company shall have maintained the
effectiveness of such Registration Statement as required by this Agreement and
if the Company shall otherwise have complied in all material respects with its
obligations under this Agreement, then the Company shall not be obligated to
register any Registrable Securities on such Registration Statement referred to
in this Section 2(d).

     (e) ELIGIBILITY FOR FORM S-3. The Company meets the requirements for the
use of Form S-3 for registration of the Registrable Securities for resale by the
Investors. The Company shall file all reports required to be filed by the
Company with the SEC in a timely manner so as to maintain such eligibility for
the use of Form S-3.

     3. OBLIGATIONS OF THE COMPANY. In connection with the registration of the
Registrable Securities, the Company shall:

     (a) prepare promptly, and file with the SEC not later than 45 days after
the Closing Date, a Registration Statement with respect to the number of
Registrable Securities provided in Section 2(a), and thereafter to use its best
efforts to cause each Registration Statement relating to Registrable Securities
to become effective as soon as possible after such filing, and keep the
Registration Statement effective pursuant to Rule 415 at all times during the
Registration Period; submit to the SEC, within three Business Days after the
Company learns that no review of the Registration Statement will be made by the
staff of the SEC or that the staff of the SEC has no further comments on the
Registration Statement, as the case may be, a request for acceleration of
effectiveness of the Registration Statement to a time and date not later than 48
hours after the submission of such request; notify the Investors of the
effectiveness of the Registration Statement on the date the Registration
Statement is declared effective; and the Company represents and warrants to, and
covenants and agrees with, the Investors that the Registration Statement
(including any amendments or supplements thereto and prospectuses contained
therein), at the time it is first filed with the SEC, at the time it is ordered
effective by the SEC and at all times during which it is required to be
effective hereunder (and each such amendment and supplement at the time it is
filed with the SEC and at all times during which it is available for use in
connection with the offer and sale of the Registrable Securities) shall not
contain any 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, in
light of the circumstances in which they were made, not misleading;

     (b) prepare and file with the SEC such amendments (including post-effective
amendments) and supplements to the Registration Statement and the prospectus
used in connection with the Registration Statement as may be necessary to keep
the Registration Statement effective at all times during the Registration
Period, and, during the Registration Period, comply with the provisions of the
1933 Act with respect to the disposition of all Registrable Securities of the
Company covered by the Registration Statement until such time as all of such
Registrable Securities have been disposed of in accordance with the intended
methods of disposition by the seller or sellers thereof as set forth in the
Registration Statement;

     (c) furnish to each Investor whose Registrable Securities are included in
the Registration Statement and its legal counsel, (1) promptly after the same is
prepared and publicly distributed, filed with the SEC or received by the
Company, one copy of the Registration Statement and

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any amendment thereto, each preliminary prospectus and prospectus and each
amendment or supplement thereto, each letter written by or on behalf of the
Company to the SEC or the staff of the SEC and each item of correspondence from
the SEC or the staff of the SEC relating to such Registration Statement (other
than any portion of any thereof which contains information for which the Company
has sought confidential treatment) and (2) such number of copies of a
prospectus, including a preliminary prospectus, and all amendments and
supplements thereto and such other documents, as such Investor may reasonably
request in order to facilitate the disposition of the Registrable Securities
owned by such Investor;

     (d) use reasonable efforts to (i) register and qualify the Registrable
Securities covered by the Registration Statement under such securities or blue
sky laws of such jurisdictions as the Investors who hold a majority in interest
of the Registrable Securities being offered reasonably request, (ii) prepare and
file in those jurisdictions such amendments (including post-effective
amendments) and supplements to such registrations and qualifications as may be
necessary to maintain the effectiveness thereof at all times until the end of
the Registration Period, (iii) take such other actions as may be necessary to
maintain such registrations and qualifications in effect at all times during the
Registration Period and (iv) take all other actions reasonably necessary or
advisable to qualify the Registrable Securities for sale in such jurisdictions;
provided, however, that the Company shall not be required in connection
therewith or as a condition thereto (I) to qualify to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
Section 3(d), (II) to subject itself to general taxation in any such
jurisdiction, (III) to file a general consent to service of process in any such
jurisdiction, (IV) to provide any undertakings that cause more than nominal
expense or burden to the Company or (V) to make any change in its Certificate of
Incorporation or by-laws, which in each case the Board of Directors of the
Company determines to be contrary to the best interests of the Company and its
stockholders;

     (e) in the event that the Registrable Securities are being offered in an
underwritten offering, enter into and perform its obligations under an
underwriting agreement, in usual and customary form, including, without
limitation, customary indemnification and contribution obligations, with the
underwriters of such offering;

     (f) as promptly as practicable after becoming aware of such event or
circumstance, notify each Investor of any event or circumstance of which the
Company has knowledge, as a result of which the prospectus included in the
Registration Statement, as then in effect, includes an untrue statement of a
material fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, and use its best efforts promptly to
prepare a supplement or amendment to the Registration Statement to correct such
untrue statement or omission, file such supplement or amendment with the SEC at
such time as shall permit the Investors to sell Registrable Securities pursuant
to the Registration Statement as promptly as practicable, and deliver a number
of copies of such supplement or amendment to each Investor as such Investor may
reasonably request;

     (g) as promptly as practicable after becoming aware of such event, notify
each Investor who holds Registrable Securities being sold (or, in the event of
an underwritten offering, the managing underwriters) of the issuance by the SEC
of any stop order or other suspension of effectiveness of the Registration
Statement at the earliest possible time;

     (h) permit a single firm of counsel designated as selling stockholders'
counsel by the Investors who hold a majority in interest of the Registrable
Securities being sold to review and comment on the Registration Statement and
all amendments and supplements thereto a reasonable period of time prior to
their filing with the SEC;

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     (i) make generally available to its security holders as soon as practical,
but not later than ninety (90) days after the close of the period covered
thereby, an earnings statement (in form complying with the provisions of Rule
158 under the 1933 Act) covering a twelve-month period beginning not later than
the first day of the Company's fiscal quarter next following the effective date
of the Registration Statement;

     (j) at the request of the Investors who hold a majority in interest of the
Registrable Securities being sold, furnish on the date that Registrable
Securities are delivered to an underwriter, if any, for sale in connection with
the Registration Statement (i) a letter, dated such date, from the Company's
independent certified public accountants in form and substance as is customarily
given by independent certified public accountants to underwriters in an
underwritten public offering, addressed to the underwriters; and (ii) an
opinion, dated such date, from counsel representing the Company for purposes of
such Registration Statement, in form and substance as is customarily given in an
underwritten public offering, addressed to the underwriters and the Investors;

     (k) make available for inspection by any Investor, any underwriter
participating in any disposition pursuant to the Registration Statement, and any
attorney, accountant or other agent retained by any such Investor or underwriter
(collectively, the "Inspectors"), all pertinent financial and other records,
pertinent corporate documents and properties of the Company (collectively, the
"Records"), as shall be reasonably necessary to enable each Investor to exercise
its due diligence responsibility, and cause the Company's officers, directors
and employees to supply all information which any Inspector may reasonably
request for purposes of such due diligence; provided, however, that each
Inspector shall hold in confidence and shall not make any disclosure (except to
an Investor) of any Record or other information which the Company determines in
good faith to be confidential, and of which determination the Inspectors are so
notified, unless (i) the disclosure of such Records is necessary to avoid or
correct a misstatement or omission in any Registration Statement, (ii) the
release of such Records is ordered pursuant to a subpoena or other order from a
court or government body of competent jurisdiction or (iii) the information in
such Records has been made generally available to the public other than by
disclosure in violation of this or any other agreement. The Company shall not be
required to disclose any confidential information in such Records to any
Inspector until and unless such Inspector shall have entered into
confidentiality agreements (in form and substance satisfactory to the Company)
with the Company with respect thereto, substantially in the form of this Section
3(k). Each Investor agrees that it shall, upon learning that disclosure of such
Records is sought in or by a court or governmental body of competent
jurisdiction or through other means, give prompt notice to the Company and allow
the Company, at the Company's own expense, to undertake appropriate action to
prevent disclosure of, or to obtain a protective order for, the Records deemed
confidential. The Company shall hold in confidence and shall not make any
disclosure of information concerning an Investor provided to the Company
pursuant to Section 4(e) hereof unless (i) disclosure of such information is
necessary to comply with federal or state securities laws, (ii) the disclosure
of such information is necessary to avoid or correct a misstatement or omission
in any Registration Statement, (iii) the release of such information is ordered
pursuant to a subpoena or other order from a court or governmental body of
competent jurisdiction or (iv) such information has been made generally
available to the public other than by disclosure in violation of this or, to the
knowledge of the Company, any other agreement. The Company agrees that it shall,
upon learning that disclosure of such information concerning an Investor is
sought in or by a court or governmental body of competent jurisdiction or
through other means, give prompt notice to such Investor and allow such
Investor, at such Investor's own expense, to undertake appropriate action to
prevent disclosure of, or to obtain a protective order for, such information;

     (l) use its best efforts (i) to cause all the Registrable Securities
covered by the Registration Statement to be listed on the Nasdaq or such other
principal securities market on which securities of the same class or series
issued by the Company are then listed or traded or (ii) if securities of

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the same class or series as the Registrable Securities are not then listed on
Nasdaq or any such other securities market, to cause all of the Registrable
Securities covered by the Registration Statement to be listed on the New York
Stock Exchange, the American Stock Exchange or the Nasdaq SmallCap Market;

     (m) provide a transfer agent and registrar, which may be a single entity,
for the Registrable Securities not later than the effective date of the
Registration Statement;

     (n) cooperate with the Investors who hold Registrable Securities being
offered and the managing underwriter or underwriters, if any, to facilitate the
timely preparation and delivery of certificates (not bearing any restrictive
legends) representing Registrable Securities to be offered pursuant to the
Registration Statement and enable such certificates to be in such denominations
or amounts, as the case may be, as the managing underwriter or underwriters, if
any, or the Investors may reasonably request and registered in such names as the
managing underwriter or underwriters, if any, or the Investors may request; and,
within three Business Days after a Registration Statement which includes
Registrable Securities is ordered effective by the SEC, the Company shall
deliver to the transfer agent for the Registrable Securities (with copies to the
Investors whose Registrable Securities are included in such Registration
Statement) an instruction substantially in the form attached hereto as EXHIBIT 1
and shall cause legal counsel selected by the Company to deliver to the
Investors an opinion of such counsel in the form attached hereto as EXHIBIT 2
(with a copy to the Company's transfer agent);

     (o) during the period the Company is required to maintain effectiveness of
the Registration Statement pursuant to Section 3(a), the Company shall not bid
for or purchase any Common Stock or any right to purchase Common Stock or
attempt to induce any person to purchase any such security or right if such bid,
purchase or attempt would in any way limit the right of the Investors to sell
Registrable Securities by reason of the limitations set forth in Regulation M
under the 1934 Act; and

     (p) take all other reasonable actions necessary to expedite and facilitate
disposition by the Investors of the Registrable Securities pursuant to the
Registration Statement.

     4. OBLIGATIONS OF THE INVESTORS. In connection with the registration of the
Registrable Securities, the Investors shall have the following obligations:

     (a) It shall be a condition precedent to the obligations of the Company to
complete the registration pursuant to this Agreement with respect to the
Registrable Securities of a particular Investor that such Investor shall furnish
to the Company such information regarding itself, the Registrable Securities
held by it and the intended method of disposition of the Registrable Securities
held by it as shall be reasonably required to effect the registration of such
Registrable Securities and shall execute such documents in connection with such
registration as the Company may reasonably request. At least five days prior to
the first anticipated filing date of the Registration Statement, the Company
shall notify each Investor of the information the Company requires from each
such Investor (the "Requested Information") if any of such Investor's
Registrable Securities are eligible for inclusion in the Registration Statement.
If at least two Business Days prior to the filing date the Company has not
received the Requested Information from an Investor (a "Non-Responsive
Investor"), then the Company may file the Registration Statement without
including Registrable Securities of such Non-Responsive Investor but shall not
be relieved of its obligation to file a Registration Statement with the SEC
relating to the Registrable Securities of such Non-Responsive Investor promptly
after such Non-Responsive Investor provides the Requested Information; provided,
however, that (i) all expenses of the Company relating to the preparation,
amendment and filing of the Registration Statement to include the Registrable
Securities of such Non-Responsive Investor shall be paid by such Non-Responsive
Investor and (ii) the Company shall not be considered in breach of any of its
obligations to such Non-Responsive Investor to timely file the Registration
Statement under this Agreement or be subject to any liability to such
Non-Responsive

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Investor pursuant to Section 2(c) to the extent a delay in filing or obtaining
the effectiveness of the Registration Statement for such Non-Responsive Investor
is due to the failure of such Non-Responsive Investor to timely provide the
Requested Information.

     (b) Each Investor by such Investor's acceptance of the Registrable
Securities agrees to cooperate with the Company as reasonably requested by the
Company in connection with the preparation and filing of the Registration
Statement hereunder, unless such Investor has notified the Company in writing of
such Investor's election to exclude all of such Investor's Registrable
Securities from the Registration Statement;

     (c) In the event Investors holding a majority in interest of the
Registrable Securities being registered determine to engage the services of an
underwriter, each Investor agrees to enter into and perform such Investor's
obligations under an underwriting agreement, in usual and customary form,
including, without limitation, customary indemnification and contribution
obligations, with the managing underwriter of such offering and take such other
actions as are reasonably required in order to expedite or facilitate the
disposition of the Registrable Securities, unless such Investor has notified the
Company in writing of such Investor's election to exclude all of such Investor's
Registrable Securities from the Registration Statement;

     (d) Each Investor agrees that, upon receipt of any notice from the Company
of the happening of any event of the kind described in Section 3(f) or 3(g),
such Investor will immediately discontinue disposition of Registrable Securities
pursuant to the Registration Statement covering such Registrable Securities
until such Investor's receipt of the copies of the supplemented or amended
prospectus contemplated by Section 3(f) or 3(g) and, if so directed by the
Company, such Investor shall deliver to the Company (at the expense of the
Company) or destroy (and deliver to the Company a certificate of destruction)
all copies in such Investor's possession of the prospectus covering such
Registrable Securities current at the time of receipt of such notice;

     (e) No Investor may participate in any underwritten registration hereunder
unless such Investor (i) agrees to sell such Investor's Registrable Securities
on the basis provided in any underwriting arrangements approved by the Investors
entitled hereunder to approve such arrangements, (ii) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents reasonably required under the terms of such underwriting
arrangements and (iii) agrees to pay its pro rata share of all underwriting
discounts and commissions and other fees and expenses of investment bankers and
any manager or managers of such underwriting and legal expenses of the
underwriters applicable with respect to its Registrable Securities, in each case
to the extent not payable by the Company pursuant to the terms of this
Agreement; and

     (f) Each Investor agrees to take all reasonable actions necessary to comply
with the prospectus delivery requirements of the 1933 Act applicable to its
sales of Registrable Securities.

     5. EXPENSES OF REGISTRATION. All reasonable expenses, other than
underwriting discounts and commissions and other fees and expenses of investment
bankers and other than brokerage commissions, incurred in connection with
registrations, filings or qualifications pursuant to Sections 2 and 3,
including, without limitation, all registration, listing and qualifications
fees, printers and accounting fees and the fees and disbursements of counsel for
the Company and one legal counsel for the Investors and the investors under the
Other Registration Rights Agreement (in addition to the payment of the Initial
Investor's expenses to the extent provided in the Subscription Agreement), shall
be borne by the Company, provided, however, that the Investors shall bear the
fees and out-of-pocket expenses of the one legal counsel selected by the
Investors and the investors under the Other Registration Rights Agreement
pursuant to Section 2(b) hereof and thereof.

                                      -9-

<PAGE>   10

     6. INDEMNIFICATION. In the event any Registrable Securities are included in
a Registration Statement under this Agreement:

     (a) To the extent permitted by law, the Company will indemnify and hold
harmless each Investor who holds such Registrable Securities, the directors, if
any, of such Investor, the officers, if any, of such Investor, each person, if
any, who controls any Investor within the meaning of the 1933 Act or the 1934
Act, any underwriter (as defined in the 1933 Act) for the Investors, the
directors, if any, of such underwriter and the officers, if any, of such
underwriter, and each person, if any, who controls any such underwriter within
the meaning of the 1933 Act or the 1934 Act (each, an "Indemnified Person"),
against any losses, claims, damages, liabilities or expenses (joint or several)
incurred (collectively, "Claims") to which any of them may become subject under
the 1933 Act, the 1934 Act or otherwise, insofar as such Claims (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out of
or are based upon any of the following statements or omissions in or violations
with respect to the Registration Statement, or any post-effective amendment
thereof, or any prospectus included therein: (i) any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement or
any post-effective amendment thereof or the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, (ii) any untrue statement or alleged
untrue statement of a material fact contained in any preliminary prospectus if
used prior to the effective date of such Registration Statement, or contained in
the final prospectus (as amended or supplemented, if the Company files any
amendment thereof or supplement thereto with the SEC) or the omission or alleged
omission to state therein any material fact necessary to make the statements
made therein, in light of the circumstances under which the statements therein
were made, not misleading or (iii) any violation or alleged violation by the
Company of the 1933 Act, the 1934 Act, any state securities law or any rule or
regulation under the 1933 Act, the 1934 Act or any state securities law (the
matters in the foregoing clauses (i) through (iii) being, collectively,
"Violations"). Subject to the restrictions set forth in Section 6(d) with
respect to the number of legal counsel, the Company shall reimburse the
Investors and the other Indemnified Persons, promptly as such expenses are
incurred and are due and payable, for any legal fees or other reasonable
expenses incurred by them in connection with investigating or defending any such
Claim. Notwithstanding anything to the contrary contained herein, the
indemnification agreement contained in this Section 6(a): (I) shall not apply to
a Claim arising out of or based upon a Violation which occurs in reliance upon
and in conformity with information furnished in writing to the Company by any
Indemnified Person or underwriter for such Indemnified Person expressly for use
in connection with the preparation of the Registration Statement, the prospectus
or any such amendment thereof or supplement thereto, if such prospectus was
timely made available by the Company pursuant to Section 3(c) hereof; (II) with
respect to any preliminary prospectus shall not inure to the benefit of any
Indemnified Person if the untrue statement or omission of material fact
contained in the preliminary prospectus was corrected in the prospectus, as then
amended or supplemented, if such prospectus was timely made available by the
Company pursuant to Section 3(c) hereof; and (III) shall not apply to amounts
paid in settlement of any Claim if such settlement is effected without the prior
written consent of the Company, which consent shall not be unreasonably
withheld. Such indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of the Indemnified Person and shall survive
the transfer of the Registrable Securities by the Investors pursuant to Section
9.

     (b) In connection with any Registration Statement in which an Investor is
participating, each such Investor agrees to indemnify and hold harmless, to the
same extent and in the same manner set forth in Section 6(a), the Company, each
of its directors, each of its officers who signs the Registration Statement,
each person, if any, who controls the Company within the meaning of the 1933 Act
or the 1934 Act, any underwriter and any other stockholder selling securities
pursuant to the Registration Statement or any of its directors or officers or
any person who controls such stockholder or

                                      -10-

<PAGE>   11

underwriter within the meaning of the 1933 Act or the 1934 Act (collectively and
together with an Indemnified Person, an "Indemnified Party"), against any Claim
to which any of them may become subject, under the 1933 Act, the 1934 Act or
otherwise, insofar as such Claim arises out of or is based upon any Violation,
in each case to the extent (and only to the extent) that such Violation occurs
in reliance upon and in conformity with written information furnished to the
Company by such Investor expressly for use in connection with such Registration
Statement; and such Investor will reimburse any legal or other expenses
reasonably incurred by any Indemnified Party, promptly as such expenses are
incurred and are due and payable, in connection with investigating or defending
any such Claim; provided, however, that the indemnity agreement contained in
this Section 6(b) shall not apply to amounts paid in settlement of any Claim if
such settlement is effected without the prior written consent of such Investor,
which consent shall not be unreasonably withheld; provided, further, however,
that the Investor shall be liable under this Section 6(b) for only that amount
of a Claim as does not exceed the amount by which the net proceeds to such
Investor from the sale of Registrable Securities pursuant to such Registration
Statement exceeds the cost of such Registrable Securities to such Investor. Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of such Indemnified Party and shall survive the transfer of
the Registrable Securities by the Investors pursuant to Section 9.
Notwithstanding anything to the contrary contained herein, the indemnification
agreement contained in this Section 6(b) with respect to any preliminary
prospectus shall not inure to the benefit of any Indemnified Party if the untrue
statement or omission of material fact contained in the preliminary prospectus
was corrected on a timely basis in the prospectus, as then amended or
supplemented.

     (c) The Company shall be entitled to receive indemnities from underwriters,
selling brokers, dealer managers and similar securities industry professionals
participating in any distribution, to the same extent as provided above, with
respect to information so furnished in writing by such persons expressly for
inclusion in the Registration Statement.

     (d) Promptly after receipt by an Indemnified Person or Indemnified Party
under this Section 6 of notice of the commencement of any action (including any
governmental action), such Indemnified Person or Indemnified Party shall, if a
Claim in respect thereof is to be made against any indemnifying party under this
Section 6, deliver to the indemnifying party a written notice of the
commencement thereof and the indemnifying party shall have the right to
participate in, and, to the extent the indemnifying party so desires, jointly
with any other indemnifying party similarly noticed, to assume control of the
defense thereof with counsel selected by the indemnifying party but reasonably
acceptable to the Indemnified Person or the Indemnified Party, as the case may
be; provided, however, that an Indemnified Person or Indemnified Party shall
have the right to retain its own counsel with the fees and expenses to be paid
by the indemnifying party, if, in the reasonable opinion of counsel retained by
the indemnifying party, the representation by such counsel of the Indemnified
Person or Indemnified Party and the indemnifying party would be inappropriate
due to actual or potential differing interests between such Indemnified Person
or Indemnified Party and any other party represented by such counsel in such
proceeding. In such event, the Company shall pay for only one separate legal
counsel for the Investors; such legal counsel shall be selected by the Investors
holding a majority in interest of the Registrable Securities included in the
Registration Statement to which the Claim relates. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of any such action shall not relieve such indemnifying party of any
liability to the Indemnified Person or Indemnified Party under this Section 6,
except to the extent that the indemnifying party is prejudiced in its ability to
defend such action. The indemnification required by this Section 6 shall be made
by periodic payments of the amount thereof during the course of the
investigation or defense, as such expense, loss, damage or liability is incurred
and is due and payable.

     7. CONTRIBUTION. To the extent any indemnification by an indemnifying party
is prohibited or limited by law, the indemnifying party agrees to make the
maximum contribution with

                                      -11-

<PAGE>   12

respect to any amounts for which it would otherwise be liable under Section 6 to
the fullest extent permitted by law; provided, however, that (a) no contribution
shall be made under circumstances where the maker would not have been liable for
indemnification under the fault standards set forth in Section 6, (b) no seller
of Registrable Securities guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from
any seller of Registrable Securities who was not guilty of such fraudulent
misrepresentation and (c) contribution by any seller of Registrable Securities
shall be limited in amount to the amount by which the net amount of proceeds
received by such seller from the sale of such Registrable Securities exceeds the
purchase price paid by such seller for such Registrable Securities.

     8. REPORTS UNDER 1934 ACT. With a view to making available to the Investors
the benefits of Rule 144, the Company agrees to:

     (a) make and keep public information available, as those terms are
understood and defined in Rule 144;

     (b) file with the SEC in a timely manner all reports and other documents
required of the Company under the 1933 Act and the 1934 Act; and

     (c) furnish to each Investor so long as such Investor owns Registrable
Securities, promptly upon request, (i) a written statement by the Company that
it has complied with the reporting requirements of Rule 144 and the 1934 Act,
(ii) a copy of the most recent annual or quarterly report of the Company and
such other reports and documents so filed by the Company and (iii) such other
information as may be reasonably requested to permit the Investors to sell such
securities pursuant to Rule 144 without registration.

     9. ASSIGNMENT OF THE REGISTRATION RIGHTS. The rights to have the Company
register Registrable Securities pursuant to this Agreement shall be
automatically assigned by the Investors to any Permitted Transferee only if: (a)
the Investor agrees in writing with such Permitted Transferee to assign such
rights, and a copy of such agreement is furnished to the Company within a
reasonable time after such assignment, (b) except as otherwise provided in
Section 4(a)(2) of the Subscription Agreement, the Company is, within a
reasonable time after such transfer or assignment, furnished with written notice
of (i) the name and address of such Permitted Transferee and (ii) the securities
with respect to which such registration rights are being transferred or
assigned, (c) immediately following such transfer or assignment the further
disposition of such securities by such Permitted Transferee is restricted under
the 1933 Act and applicable state securities laws, and (d) at or before the time
the Company receives the written notice contemplated by clause (b) of this
sentence (or such later time within ten Business Days after the Company approves
a Proposed Transferee pursuant to Section 4(a)(2) of the Subscription Agreement)
such Permitted Transferee agrees in writing with the Company to be bound by all
of the provisions contained herein. In connection with any such transfer the
Company shall, at the cost and expense of the Permitted Transferee, promptly
after such assignment take such actions as shall be reasonably acceptable to the
Initial Investor and such Permitted Transferee to assure that the Registration
Statement and related prospectus are available for use by such Permitted
Transferee for sales of the Registrable Securities in respect of which the
rights to registration have been so assigned. In connection with any such
assignment, each Investor shall have the right to assign to such Permitted
Transferee such Investor's rights under the Subscription Agreement by notice of
such assignment to the Company. Following such notice of assignment of rights
under the Subscription Agreement, the Company shall be obligated to such
Permitted Transferee to perform all of its covenants under the Subscription
Agreement as if such Permitted Transferee were the Buyer under the Subscription
Agreement.

                                      -12-

<PAGE>   13

     10. AMENDMENT OF REGISTRATION RIGHTS. Any provision of this Agreement may
be amended and the observance thereof may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of the Majority Holders. Any amendment or waiver effected in
accordance with this Section 10 shall be binding upon each Investor and the
Company.

     11. MISCELLANEOUS.

     (a) A person or entity is deemed to be a holder of Registrable Securities
whenever such person or entity owns of record such Registrable Securities. If
the Company receives conflicting instructions, notices or elections from two or
more persons or entities with respect to the same Registrable Securities, the
Company shall act upon the basis of instructions, notice or election received
from the registered owner of such Registrable Securities.

     (b) Notices required or permitted to be given hereunder shall be in writing
and shall be deemed to be sufficiently given when personally delivered (by hand,
by courier, by telephone line facsimile transmission (with answer back
confirmation) or other means) (i) if to the Company, at 999 18th Street, Suite
2201, Denver, Colorado 80202, Attention: Chief Executive Officer, telephone line
facsimile transmission number (303) 672-0711, (ii) if to the Initial Investor,
c/o _____________________________, telephone line facsimile transmission number
_______________________ and (iii) if to any other Investor, at such address as
such Investor shall have provided in writing to the Company, or at such other
address as each such party furnishes by notice given in accordance with this
Section 11(b), and shall be effective upon receipt.

     (c) Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such right or remedy,
shall not operate as a waiver thereof.

     (d) This Agreement shall be enforced, governed by and construed in
accordance with the laws of the State of Colorado applicable to agreements made
and to be performed entirely within such State. In the event that any provision
of this Agreement is invalid or unenforceable under any applicable statute or
rule of law, then such provision shall be deemed inoperative to the extent that
it may conflict therewith and shall be deemed modified to conform with such
statute or rule of law. Any provision hereof which may prove invalid or
unenforceable under any law shall not affect the validity or enforceability of
any other provision hereof.

     (e) This Agreement constitutes the entire agreement among the parties
hereto with respect to the subject matter hereof. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein. This Agreement supersedes all prior agreements and understandings among
the parties hereto with respect to the subject matter hereof.

     (f) Subject to the requirements of Section 9 hereof, this Agreement shall
inure to the benefit of and be binding upon the successors and assigns of each
of the parties hereto.

     (g) All pronouns and any variations thereof refer to the masculine,
feminine or neuter, singular or plural, as the context may require.

     (h) The headings in this Agreement are for convenience of reference only
and shall not limit or otherwise affect the meaning hereof.

     (i) The Company acknowledges that any failure by the Company to perform its
material obligations under this Agreement, including, without limitation, the
Company's obligations under Section 3(n), or any delay in such performance could
result in damages to the Investors and the Company agrees that, in addition to
any other liability the Company may have by reason of any such failure or

                                      -13-

<PAGE>   14
delay, the Company shall be liable for the following damages to the extent
caused by any such failure or delay: (i) an amount equal to the aggregate
purchase price paid by the Initial Investor for the Securities pursuant to the
Subscription Agreement plus (ii) an amount equal to the Initial Investor's
historical rate of return on all of such Initial Investor's investments in
private placements of debt and equity securities of corporate issuers multiplied
by such aggregate purchase price paid.

     (j) Each party shall do and perform, or cause to be done and performed, all
such further acts and things, and shall execute and deliver all such other
agreements, certificates, instruments and documents, as the other party may
reasonably request in order to carry out the intent and accomplish the purposes
of this Agreement and the consummation of the transactions contemplated hereby.

     (k) The language used in this Agreement will be deemed to be the language
chosen by the parties to express their mutual intent, and no rules of strict
construction will be applied against any party.

     (l) This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original but all of which shall constitute one and the
same agreement. This Agreement, once executed by a party, may be delivered to
the other party hereto by telephone line facsimile transmission of a copy of
this Agreement bearing the signature of the party so delivering this Agreement.

                                      -14-

<PAGE>   15

     IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed by their respective officers thereunto duly authorized as of day and
year first above written.

                                       RMI.NET, INC.

                                       By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                       -----------------------------------------

                                       By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                      -15-

<PAGE>   16

                                                                 EXHIBIT 1
                                                                    TO
                                                                REGISTRATION
                                                              RIGHTS AGREEMENT

                              [Company Letterhead]

                                         [Date]

American Securities Transfer & Trust, Inc.,
   as Transfer Agent and Registrar
938 Quail Street
Suite 101
Lakewood, Colorado 80215-5513

Ladies and Gentlemen:

         This letter shall serve as our irrevocable authorization and direction
to you (1) to transfer or re-register the certificates for the shares of Common
Stock, $.001 par value (the "Common Stock"), of RMI.NET, Inc., a Delaware
corporation (the "Company"), represented by certificate numbers _______ and
_______ for an aggregate of _______ shares (the "Outstanding Shares") of Common
Stock presently registered in the name of [Name of Investors] upon surrender of
such certificate(s) to you, notwithstanding the legend appearing on such
certificates, and (2) to issue shares (the "Warrant Shares") of Common Stock to
or upon the order of the holder from time to time on exercise of the Common
Stock Purchase Warrants, Class A and Common Stock Purchase Warrants, Class B
(collectively, the "Warrants") exercisable for Common Stock issued by the
Company upon receipt by you of a subscription form from such holder in the form
enclosed herewith. The transfer or re-registration of the certificates for the
Outstanding Shares by you should be made at such time as you are requested to do
so by the record holder of the Outstanding Shares. The certificate issued upon
such transfer or re-registration should be registered in such name as requested
by the holder of record of the certificate surrendered to you and should not
bear any legend which would restrict the transfer of the shares represented
thereby. In addition, you are hereby directed to remove any stop-transfer
instruction relating to the Outstanding Shares. Certificates for the Warrant
Shares should not bear any restrictive legend and should not be subject to any
stop-transfer restriction.

         Contemporaneously with the delivery of this letter, the Company is
delivering to you the following:

         (a) a list showing the name and address of each holder of record of the
     Warrants and the date of issuance, Warrant number, and, in the case of the
     Class A Warrants, the initial fixed number of shares issuable upon exercise
     thereof;

         (b) the form of subscription relating to the exercise of the Warrants;
     and

         (c) an opinion of Christopher J. Melcher, Esq., Vice President and
     General Counsel of the Company, as to registration of the Outstanding
     Shares and the Warrant Shares for resale under the Securities Act of 1933,
     as amended.

                                      1-16

<PAGE>   17

         Should you have any questions concerning this matter, please contact
me.

                                       Very truly yours,

                                       RMI.NET, INC.

                                       By:
                                           -------------------------------------
                                           Name:
                                           Title:

Enclosures
cc: [Names of Investors]

                                      1-17

<PAGE>   18

                                                                EXHIBIT 2
                                                                    TO
                                                               REGISTRATION
                                                             RIGHTS AGREEMENT

                                     [SEC Effective Date]

[Names and Addresses of Investors]

                                  RMI.NET, INC.
                             SHARES OF COMMON STOCK

Ladies and Gentlemen:

         I am Vice President and General Counsel of RMI.NET, Inc., a Delaware
corporation (the "Company"), and I understand that the Company has sold to
[Names of Investors] (the "Holders") an aggregate of ________ shares (the
"Common Shares") of the Company's Common Stock, $.001 par value (the "Common
Stock"), and issued to the Holders Common Stock Purchase Warrants, Class A and
Common Stock Purchase Warrants, Class B (collectively, the "Warrants"). The
Common Shares were sold, and the Warrants were issued, to the Holders pursuant
to several Subscription Agreements, dated as of December 7, 1999, by and between
the Holders and the Company (the "Subscription Agreements"). Pursuant to the
several Registration Rights Agreements, dated as of December 7, 1999, by and
between the Company and each Holder (the "Registration Rights Agreements")
entered into in connection with the purchase by the Holders of the Common
Shares, the Company agreed with each Holder, among other things, to register for
resale (1) the Common Shares and (2) the shares (the "Warrant Shares") of Common
Stock issuable upon exercise of the Warrants under the Securities Act of 1933,
as amended (the "1933 Act"), upon the terms provided in the Registration Rights
Agreements. The Common Shares and the Warrant Shares are referred to herein
collectively as the "Shares." Pursuant to the Registration Rights Agreements, on
____________________ , _____ the Company filed a Registration Statement on Form
S-3 (File No. 333-__________) (the "Registration Statement") with the Securities
and Exchange Commission (the "SEC") relating to the Shares, which names the
Holders as selling stockholders thereunder.

         [Other introductory and scope of examination language to be inserted]

         Based on the foregoing, I am of the opinion that:

         (1) Since the Closing Date, the Company has timely filed with the SEC
     all forms, reports and other documents required to be filed with the SEC
     under the Securities 1934 Act of 1934, as amended (the "1934 Act"). All of
     such forms, reports and other documents complied, when filed, in all
     material respects, with all applicable requirements of the 1933 Act and the
     1934 Act;

         (2) The Registration Statement and the Prospectus contained therein
     (other than the financial statements and financial schedules and other
     financial and statistical information contained or incorporated by
     reference therein, as to which I have not been requested to and do

                                      2-18

<PAGE>   19

     not express any opinion) comply as to form in all material respects with
     the applicable requirements of the 1933 Act and the rules and regulations
     promulgated thereunder; and

         (3) The Registration Statement has become effective under the 1933 Act,
     to the best of my knowledge after due inquiry, no stop order proceedings
     with respect thereto have been instituted or threatened by the SEC. The
     Shares have been registered under the 1933 Act and may be resold by the
     respective Holders pursuant to the Registration Statement.

         I have participated in the preparation of the Registration Statement
and the Prospectus, including review and discussions with officers and other
representatives of the Company, representatives of the independent public
accountants for the Company, and your representatives at which the contents of
the Registration Statement and the Prospectus contained therein and related
matters were discussed, and, although I am not passing upon and do not assume
any responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement and the Prospectus contained therein, on
the basis of the foregoing, nothing has come to my attention that leads me to
believe either that the Registration Statement at the time the Registration
Statement became effective contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, or that the Prospectus contained in
the Registration Statement, as of its date, contained an untrue statement of a
material fact or omitted to state 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 (it being understood that I have not
been requested to and do not express any view with respect to the financial
statements and schedules and other financial and statistical data included or
incorporated by reference in the Registration Statement or the Prospectus
contained therein).

         Paragraph (3) of this opinion may be relied upon by American Securities
Transfer & Trust, Inc., as Transfer Agent and Registrar (the "Transfer Agent"),
as if addressed to the Transfer Agent.

                                       Very truly yours,

cc: American Securities Transfer & Trust, Inc.,
         as Transfer Agent and Registrar

                                      2-19FS-2700-5b (9/96)
                                                             OMB No 0596 - 0082
-------------------------------------------------------------------------------
    USDA Forest Service       Holder No.     Use Code     Authority
                               PVL 4186        161           545
                             -----------------------------------------
          SKI AREA            Auto. Type    Issue Date   Expir. Date
  TERM SPECIAL USE PERMIT         18                       8/15/39
                             -----------------------------------------
                               Location Sequence No.     Stat. Ref.
  Act of October 22, 1986        05 03 51 06 005 04
                             -----------------------------------------
                               Latitude     Longitude     LOS Case
      (Ref. FSM 2710)
-------------------------------------------------------------------------------

     SIERRA AT TAHOE, INC.      of    1111 Sierra-at-Tahoe Road
--------------------------------    -------------------------------
         (Holder Name)                  (Billing Address - 1)

                                of      Twin Bridges, CA 95735
--------------------------------    -------------------------------
     (Billing Address - 2)             (City, State & Zip Code)

(hereafter  called the  holder) is hereby  authorized  to use  National  Forest
System  lands,  on  the  ELDORADO   National   Forest,   for  the  purposes  of
constructing,  operating, and maintaining a winter sports resort including food
service, retail sales, and other ancillary facilities,  described herein, known
as the  SIERRA-AT-TAHOE  ski area and  subject to the  provisions  of this term
permit.

This permit covers approximately 1,680 acres described here and as shown on the
attached map dated Nov. 1996 labeled  Exhibit B. Portions of El Dorado National
Forest in T.11N, R.17E, M.D.B.&M.

The following  improvements,  whether on or off the site, are  authorized:  Ski
lifts, alpine and nordic ski trails,  restaurants,  signs,  parking facilities,
and  structures  needed in the operation and  maintenance  of the winter sports
resort (as listed in Exhibit A.)

Attached  Clauses.  This term permit is accepted  subject to the conditions set
forth herein on pages 2 through 12, and to A to B attached or referenced hereto
and made a part exhibits of this permit.

-------------------------------------------------------------------------------

      THIS PERMIT IS ACCEPTED SUBJECT TO ALL OF ITS TERMS AND CONDITIONS.

ACCEPTED:  SIERRA AT TAHOE, INC.

/s/ CHRIS RYMAN                           8/2/99
---------------------------------         ------------
HOLDER'S NAME AND SIGNATURE               DATE
Chris Ryman, President

/s/ JOHN A. RICE                          8/15/99
---------------------------------         ------------
John A. Rice, General Manager             DATE

APPROVED:

/s/ GARY A. BILYEU              Acting Forest Supervisor              8/19/99
-------------------------       ------------------------              -------
AUTHORIZED OFFICER'S NAME       TITLE                                 DATE
  AND SIGNATURE
<PAGE>

                              TERMS AND CONDITIONS

I. AUTHORITY AND USE AND TERM AUTHORIZED.

A. Authority.  This term  permit is issued  under the  authority  of the Act of
   October 22, 1986,  (Title 16, United States Code,  Section 497b),  and Title
   36, Code of Federal Regulations, Sections 251.50-251.64.
B. Authorized  Officer.  The authorized officer is the Forest  Supervisor.  The
   authorized  officer may designate a  representative  for  administration  of
   specific portions of this authorization.
C. Rules, Laws and Ordinances. The holder, in exercising the privileges granted
   by this term permit, shall comply with all present and future regulations of
   the Secretary of  Agriculture  and federal laws; and all present and future,
   state,  county,  and municipal laws,  ordinances,  or regulations  which are
   applicable  to the area or  operations  covered by this permit to the extent
   they are not in conflict with federal law, policy or regulation.  The Forest
   Service  assumes  no   responsibility   for  enforcing  laws,   regulations,
   ordinances and the like which are under the jurisdiction of other government
   bodies.
D. Term.
   1. This  authorization  is for a term of N/A years to provide for the holder
      to prepare a Master Development Plan. Subject to acceptance of the Master
      Development Plan by the authorized  officer,  this authorization shall be
      extended  for an  additional  N/A  years,  for a total of N/A  years,  to
      provide the holder  sufficient time to construct  facilities  approved in
      the Master  Development Plan within the schedule outlined in clause II.B.
      (Site Development Schedule),  so that the area may be used by the public.
      Further Provided;  This authorization  shall be extended by its terms for
      an  additional  of  30  years,  for a  total  of  40  years,  if it is in
      compliance with the site development  schedule in the Master  Development
      Plan and  being  in  operation  by the  10-year  anniversary  date of the
      issuance of this authorization.  Failure of the holder to comply with all
      or any  provisions  of this  clause  shall  cause  the  authorization  to
      terminate under its terms.
   2. Unless  sooner  terminated  or  revoked  by the  authorized  officer,  in
      accordance  with the provisions of the  authorization,  this permit shall
      terminate on Aug. 15, 2039, but a new special-use authorization to occupy
      and use the same National Forest land may be granted  provided the holder
      shall comply with the  then-existing  laws and regulations  governing the
      occupancy and use of National  Forest lands.  The holder shall notify the
      authorized  officer in writing not less than six (6) months prior to said
      date that such new authorization is desired.
E. Nonexclusive Use. This permit is not exclusive.  The Forest Service reserves
   the right to use or permit others to use any part of the permitted  area for
   any purpose, provided such use does not materially interfere with the rights
   and privileges hereby authorized.
F. Area Access.  Except for any  restrictions  as the holder and the authorized
   officer may agree to be necessary  protect the installation and operation of
   authorized structures and developments, the lands and waters covered by this
   permit  shall  remain  open  to the  public  for  all  lawful  purposes.  To
   facilitate  public use of this area,  all existing  roads or roads as may be
   constructed by the holder, shall remain open to the public, except for roads
   as may be  closed  by  joint  agreement  of the  holder  and the  authorized
   officer.
G. Master  Development  Plan. In consideration of the privileges  authorized by
   this permit,  the holder agrees to prepare and submit  changes in the Master
   Development  Plan  encompassing  the entire winter  sports resort  presently
   envisioned  for  development  in connection  with the National  Forest lands
   authorized by this permit,  and in a form  acceptable to the Forest Service.
   Additional  construction  beyond maintenance of existing  improvements shall
   not be  authorized  until  this  plan  has  been  amended.  Planning  should
   encompass  all the area  authorized  for use by this  permit.  The  accepted
   Master  Development  Plan shall become a part of this  permit.  For planning
   purposes,  a  capacity  for the ski  area in  people-at-one  time  shall  be
   established  in  the  Master  Development  Plan  and  appropriate   National
   Environmental Policy Act (NEPA) document.  The overall development shall not
   exceed that capacity without further  environmental  analysis  documentation
   through the appropriate NEPA process.
H. Periodic Revision.
   1. The  terms and  conditions  of this  authorization  shall be  subject  to
      revision  to  reflect  changing  times  and  conditions  so that land use
      allocation  decisions  made as a result of  revision  to Forest  Land and
      Resource Management Plan may be incorporated.
   2. At the sole discretion of the authorized  officer this term permit may be
      amended to remove  authorization  to use any National Forest System lands
      not specifically covered in the Master Development Plan and/or needed for
      use and occupancy under this authorization.
<PAGE>

II.IMPROVEMENTS.

A. Permission. Nothing in this permit shall be construed to imply permission to
   build or  maintain  any  improvement  not  specifically  named in the Master
   Development  Plan and  approved  in the annual  operating  plan,  or further
   authorized in writing by the authorized officer.
B. Site  Development  Schedule.  As part of this  permit,  a  schedule  for the
   progressive development of the permitted area and installation of facilities
   shall be  prepared  jointly by the holder  and the  Forest  Service.  Such a
   schedule  shall be  prepared  by  update  of the  "Needs  Improvement  Plan"
   annually by May 1, and shall set forth an itemized  priority list of planned
   improvements and the due date for completion.  This schedule shall be made a
   part of this  permit.  The  holder may  accelerate  the  scheduled  date for
   installation  of any  improvement  authorized,  provided the other scheduled
   priorities are met; and provided  further,  that all priority  installations
   authorized are completed to the satisfaction of the Forest Service and ready
   for public use prior to the scheduled due date.
   1. All  required  plans  and  specifications  for  site  improvements,   and
      structures  included  in  the  development  schedule  shall  be  properly
      certified and submitted to the Forest  Service at least  forty-five  (45)
      days before the construction date stipulated in the development schedule.
   2. In the event  there is  agreement  with the Forest  Service to expand the
      facilities and services provided on the areas covered by this permit, the
      holder  shall  jointly  prepare  with the  Forest  Service a  development
      schedule  for the added  facilities  prior to any  construction  and meet
      requirements  of paragraph  II.D of this section.  Such schedule shall be
      made a part of this permit.
C. Plans. All plans for development,  layout,  construction,  reconstruction or
   alteration of  improvements on the site, as well as revisions of such plans,
   must  be  prepared  by a  licensed  engineer,  architect,  and/or  landscape
   architect  (in those  states in which such  licensing  is required) or other
   qualified individual  acceptable to the authorized officer.  Such plans must
   be accepted by the authorized officer before the commencement of any work. A
   holder may be required to furnish as-built plans,  maps, or surveys upon the
   completion of construction.
D. Amendment.  This  authorization  may be amended to cover  new,  changed,  or
   additional  use(s) or area not previously  considered in the approved Master
   Development  plan.  In approving or denying  changes or  modifications,  the
   authorized  officer  shall  consider  among other  things,  the  findings or
   recommendations  of other  involved  agencies  and  whether  their terms and
   conditions of the existing  authorization may be continued or revised,  or a
   new authorization issued.
E. Ski Lift  Plans  and  Specifications.  All plans for  uphill  equipment  and
   systems shall be properly certified as being in accordance with the American
   National Standard Safety Requirements for Aerial Passenger Tramways (B77.1).
   A complete set of drawings,  specifications, and records for each lift shall
   be  maintained by the holder and made  available to the Forest  Service upon
   request.  These  documents  shall be  retained by the holder for a period of
   three (3) years after the removal of the system from National Forest land.

III.  OPERATIONS AND MAINTENANCE.

A. Conditions of  Operations.  The holder shall maintain the  improvements  and
   premises to  standards of repair,  orderliness,  neatness,  sanitation,  and
   safety  acceptable  to the  authorized  officer.  Standards  are  subject to
   periodic  change  by the  authorized  officer.  This use shall  normally  be
   exercised  at least 365 days each year or  season.  Failure of the holder to
   exercise this minimum use may result in termination pursuant to VIII.B.
B. Ski Lift, Holder  Inspection.  The holder shall have all passenger  tramways
   inspected by a qualified engineer or tramway  specialist.  Inspections shall
   be  made  in  accordance   with  the  American   National   Standard  Safety
   Requirements  for  Aerial  Passenger  Tramways  (B77.1).  A  certificate  of
   inspection,  signed by an officer of the holder's company,  attesting to the
   adequacy and safety of the  installations and equipment for public use shall
   be received by the Forest  Service  prior to public  operation  stating as a
   minimum:
       "Pursuant to our special use permit, we have had an inspection to
     determine our compliance with the American National Standard B77.1. We
     have received the results of that inspection and have made corrections
      of all deficiencies noted. The facilities are ready for public use."
C. Operating  Plan. The holder or designated  representative  shall prepare and
   annually  revise  by  October  1  (winter  activities)  and  May  1  (summer
   activities) an Operating  Plan.  The plan shall be prepared in  consultation
   with the authorized  officer or designated  representative  and cover winter
   and summer  operations as appropriate.  The provisions of the Operating Plan
   and the annual  revisions  shall
<PAGE>

   become a part of this  permit  and  shall be  submitted  by the  holder  and
   approved by the authorized officer or their designated representatives. This
   plan shall consist of at least the following sections:

      1. Ski patrol and first aid.          7. Avalanche control.
      2. Communications.                    8. Search and rescue.
      3. Signs.                             9. Boundary management.
      4. General safety and sanitation.     10.Vegetation management.
      5. Erosion control.                   11.Designation of representatives.
      6. Accident reporting.                12.Trail routes for nordic skiing.

   The authorized  officer may require a joint annual  business  meeting agenda
   to:
      a. Update  Gross Fixed  Assets and  lift-line  proration  when the fee is
         calculated by the Graduated Rate Fee System.
      b. Determine need for performance  bond for  construction  projects,  and
         amount of bond.
      c. Provide annual use reports.

D. Cutting of Trees. Trees or shrubbery on the permitted area may be removed or
   destroyed  only after the  authorized  officer has approved  and marked,  or
   otherwise designated,  that which may be removed or destroyed. Timber cut or
   destroyed shall be paid for by the holder at appraised value,  provided that
   the Forest Service reserves the right to dispose of the merchantable  timber
   to others than the holder at no stump-age cost to the holder.
E. Signs. Signs or advertising  devices erected on National Forest lands, shall
   have prior  approval by the Forest  Service as to  location,  design,  size,
   color,  and  message.  Erected  signs  shall be  maintained  or  renewed  as
   necessary to neat and  presentable  standards,  as  determined by the Forest
   Service.
F. Temporary  Suspension.  Immediate temporary suspension of the operation,  in
   whole or in part, may be required when the authorized officer, or designated
   representative,  determines  it to be necessary to protect the public health
   or  safety,  or the  environment.  The  order  for  suspension  may be given
   verbally or in writing.  In any such case,  the  superior of the  authorized
   officer,  or designated  representative,  shall, within ten (10) days of the
   request of the holder,  arrange for an  on-the-ground  review of the adverse
   conditions  with the holder.  Following  this review the superior shall take
   prompt action to affirm, modify or cancel the temporary suspension.

IV.  NONDISCRIMINATION.  During  the  performance  of this  permit,  the holder
     agrees:

A. In  connection  with the  performance  of work under this permit,  including
   construction,  maintenance,  and operation of the facility, the holder shall
   not discriminate against any employee or applicant for employment because of
   race, color, religion,  sex, national origin, age, or handicap.  (Ref. Title
   VII of the Civil Rights Act of 1964 as amended)
B. The holder and employees shall not  discriminate by segregation or otherwise
   against  any person on the basis of race,  color,  religion,  sex,  national
   origin,   age  or   handicap,   by   curtailing   or   refusing  to  furnish
   accommodations,  facilities,  services,  or use  privileges  offered  to the
   public generally. (Ref. Title VI of the Civil Rights Act of 1964 as amended,
   Section 504 of the  Rehabilitation  Act of 1973,  Title IX of the  Education
   Amendments, and the Age Discrimination Act of 1975).
C. The  holder   shall   include   and  require   compliance   with  the  above
   nondiscrimination  provisions  in any  subcontract  made with respect to the
   operations under this permit.
D. Signs setting forth this policy of  nondiscrimination to be furnished by the
   Forest Service will be conspicuously displayed at the public entrance to the
   premises,  and at other  exterior or interior  locations  as directed by the
   Forest Service.
E. The  Forest   Service   shall  have  the  right  to  enforce  the  foregoing
   nondiscrimination  provisions  by suit for  specific  performance  or by any
   other  available  remedy under the laws of the United States of the State in
   which the breach or violation occurs.

V. LIABILITIES

A. Third Party Rights.  This permit is subject to all valid existing rights and
   claims outstanding in third parties.  The United States is not liable to the
   holder for the exercise of any such right or claim.
<PAGE>

B. Indemnification  of the United  States.  The holder shall hold  harmless the
   United  States from any  liability  from damage to life or property  arising
   from the  holder's  occupancy  or use of  National  Forest  lands under this
   permit.
C. Damage to United States  Property.  The holder shall  exercise  diligence in
   protecting from damage the land and property of the United States covered by
   and used in  connection  with this  permit.  The holder shall pay the United
   States the full cost of any damage  resulting from  negligence or activities
   occurring  under  the terms of this  permit  or under any law or  regulation
   applicable to the national forests,  whether caused by the holder, or by any
   agents or employees of the holder.
D. Risks.  The holder  assumes all risk of loss to the  improvements  resulting
   from  natural  or  catastrophic  events,   including  but  not  limited  to,
   avalanches,  rising waters,  high winds,  failing limbs or trees,  and other
   hazardous  events.  If  the  improvements  authorized  by  this  permit  are
   destroyed or substantially  damaged by natural or catastrophic  events,  the
   authorized  officer  shall  conduct an  analysis  to  determine  whether the
   improvements  can be safely  occupied in the future and  whether  rebuilding
   should be allowed.  The analysis  shall be provided to the holder within six
   (6) months of the event.
E. Hazards. The holder has the responsibility of inspecting the area authorized
   for use under this permit for evidence of hazardous  conditions  which could
   affect the improvements or pose a risk of injury to individuals.
F. Insurance.  The  holder  shall  have in  force  public  liability  insurance
   covering:  (1)  property  damage  in the  amount of Fifty  thousand  dollars
   ($50,000.00),   and  (2)  damage  to  persons  in  the  minimum   amount  of
   Five-hundred  thousand  dollars  ($  500,000.00  ) in the  event of death or
   injury to one  individual,  and the minimum  amount of One  million  dollars
   ($1,000,000.00  ) in  the  event  of  death  or  injury  to  more  than  one
   individual.  These  minimum  amounts  and terms are subject to change at the
   sole discretion of the authorized officer at the five-year  anniversary date
   of this authorization.  The coverage shall extend to property damage, bodily
   injury,  or death  arising out of the holder's  activities  under the permit
   including,  but  not  limited  to,  occupancy  or use of the  land  and  the
   construction,  maintenance, and operation of the structures,  facilities, or
   equipment  authorized  by this permit.  Such  insurance  shall also name the
   United  States  as  an  additionally  insured.  The  holder  shall  send  an
   authenticated copy of its insurance policy to the Forest Service immediately
   upon  issuance  of the  policy.  The policy  shall  also  contain a specific
   provision  or rider to the effect that the policy  shall not be cancelled or
   its provisions  changed or deleted before thirty (30) days written notice to
   the  Forest  Supervisor,  100 Forni  Road,  Placerville,  CA  95667,  by the
   insurance company.
   Rider Clause (for insurance companies) "It is understood and agreed that the
   coverage provided under this policy shall not be cancelled or its provisions
   changed or deleted  before thirty (30) days of receipt of written  notice to
   the  Forest  Supervisor,  100 Forni  Road,  Placerville,  CA  95667,  by the
   insurance company."

VI.   FEES.

A. Fee  Calculation.  The annual fee due the United  States for the  activities
   authorized by this permit shall be calculated using the following formula:

      SAPF = (.015 x AGR in bracket 1) + (.025 x AGR in bracket 2) + (.0275
              x AGR in bracket 3) + (.04 x AGR in bracket 4)
             Where:
      AGR  = [(LT+ SS) x (proration %)] + GRAF

   AGR          is   adjusted gross revenue;
   LT           is   revenue from sales of alpine and nordic lift tickets and
                     passes;
   GRAF         is   gross year-round revenue from ancillary facilities;
   Proration %  is   the factor to apportion revenue attributable to use of
                     National Forest System lands;
   SAPF         is   the ski area permit fee for use of National Forest System
                     lands; and
   SS           is   revenue from alpine and nordic ski school operations.

   1. SAPF shall be  calculated  by summing  the  results  of  multiplying  the
      indicated  percentage rates by the amount of the holder's  adjusted gross
      revenue  (AGR),  which  falls  into  each of the  four  brackets.  Follow
<PAGE>

      direction  in  paragraph  2 to  determine  AGR.  The  permit fee shall be
      calculated  based on the holder's  fiscal year,  unless  mutually  agreed
      otherwise by the holder and the authorized officer.

      The four  revenue  brackets  shall be adjusted  annually by the  consumer
      price index issued in FSH 2709.11, chapter 30. The revenue brackets shall
      be indexed for the  previous  calendar  year.  The  holder's  AGR for any
      fiscal  year  shall  not be  split  into  more  than  one set of  indexed
      brackets.  Only the levels of AGR  defined in each  bracket  are  updated
      annually. The percentage rates do not change.

      The revenue  brackets  and  percentages  displayed in Exhibit 01 shall be
      used as shown in the preceding formula to calculate the permit fee.

     Adjusted Gross Revenue (AGR) Brackets and Associated Percentage Rates
               for Use in Determining Ski Area Permit Fee (SAPF)

-------------------------------------------------------------------------------
        Revenue Brackets (updated annually by CPI*) and Percentage Rates

  Holder FY      Bracket 1     Bracket 2    Bracket 3     Bracket 4
                  (1.5%)        (2.5%)       (2.75%)        (4%)
-------------------------------------------------------------------------------
   FY 1996      All revenue   $3,000,000   $15,000,000   All revenue
     CPI:          below          to            to          over
     N/A        $3,000,000   <$15,000,000  $50,000,000   $50,000,000

    FY1997      All revenue   $3,090,000   $15,450,000   All revenue
     CPI:          below          to            to          over
    1.030       $3,090,000   <$15,450,000  $51,500,000   $51,500,000

    FY1998      All revenue   $3,158,000   $15,790,000   All revenue
     CPI:          below          to            to          over
    1.022       $3,158,000   <$15,790,000  $52,633,000   $52,633,000

   FY 1999      All revenue   $3,212,000   $16,058,000   All revenue
     CPI:          below          to            to          over
    1.017       $3,212,000   <$16,058,000  $53,528,000   $53,528,000

   FY 2000      BRACKETS WILL BE UPDATED ANNUALLY BY CPI*
  and beyond

-------------------------------------------------------------------------------
*  The  authorized  officer  shall  notify  the holder of the  updated  revenue
   brackets based on the Consumer Price Index (CPI) which is revised and issued
   annually in FSH 2709.11, chapter 30.
-------------------------------------------------------------------------------

2. AGR shall be  calculated  by summing the revenue  from lift  tickets and ski
   school operations  prorated for use of National Forest System lands and from
   ancillary facility operations conducted on National Forest System lands.

   Revenue  inclusions  shall be income from sales of alpine and nordic tickets
   and ski area passes; alpine and nordic ski school operations;  gross revenue
   from ancillary  facilities;  the value of bartered  goods and  complimentary
   lift tickets  (such as lift tickets  provided free of charge to the holder's
   friends or relatives); and special event revenue.  Discriminatory pricing, a
   rate based solely on race,  color,  religion,  sex,  national  origin,  age,
   disability, or place of residence, is not allowed, but if it occurs, include
   the amount  that would have been  received  had the  discriminatory  pricing
   transaction been made at the market price, the price generally  available to
   an informed public, excluding special promotions.

   Revenue  exclusions  shall be  income  from  sales of  operating  equipment;
   refunds;  rent paid to the holder by subholders;  sponsor  contributions  to
   special events; any amount  attributable to employee  gratuities or employee
   lift tickets;  discounts;  ski area tickets or passes  provided for a public
   safety or public
<PAGE>

   service purpose (such as for National Ski Patrol or for volunteers to assist
   on the slope in the Special  Olympics);  and other goods Or services (except
   for bartered goods and complimentary lift tickets) for which the holder does
   not receive money.

   Include the following in AGR:
   a. Revenue  from sales of  year-round  alpine and nordic ski area passes and
      tickets and revenue from alpine and nordic ski school operations prorated
      according to the percentage of use between  National  Forest System lands
      and private land in the ski area;
   b. Gross   year-round   revenue  from  temporary  and  permanent   ancillary
      facilities located on National Forest System lands;
   c. The value of bartered  goods and  complimentary  lift tickets,  which are
      goods,  services,  or  privileges  that are not  available to the general
      public  (except for  employee  gratuities,  employee  lift  tickets,  and
      discounts,  and except for ski area  tickets  and passes  provided  for a
      public safety or public service purpose) and that are donated or provided
      without  charge in exchange for  something of value to  organizations  or
      individuals (for example, ski area product discounts,  service discounts,
      or lift  tickets  that  are  provided  free of  charge  in  exchange  for
      advertising).  Bartered goods and complimentary  lift tickets (except for
      employee gratuities, employee lift tickets, discounts, and except for ski
      area tickets and passes  provided for a public  safety or public  service
      purpose)  valued at market  price shall be included in the AGR formula as
      revenue under LT, SS, or GRAF, depending on the type of goods,  services,
      or privileges donated or bartered; and
   d. Special event revenue from events,  such as food  festivals,  foot races,
      and concerts.  Special event revenue shall be included in the AGR formula
      as  revenue  under  LT,  SS,  or GRAF,  as  applicable.  Prorate  revenue
      according to the percentage of use between  National  Forest System lands
      and private land as described in the following paragraphs 5 and 6.
3. LT is the revenue  from sales of alpine and nordic  lift  tickets and passes
   purchased  for the  purpose of using a ski area during any time of the year,
   including  revenue  that is  generated on private land (such as from tickets
   sold on private land).
4. SS is the revenue from lessons  provided to teach alpine or nordic skiing or
   other  winter  sports   activities,   such  as  racing,   snowboarding,   or
   snowshoeing,  including  revenue  that is generated on private land (such as
   from tickets sold on private land).
5. Proration % is the method used to prorate  revenue from the sale of ski area
   passes and lift  tickets  and  revenue  from ski school  operations  between
   National  Forest  System lands and private land in the ski area.  Separately
   prorate alpine and nordic revenue with an appropriate  proration factor. Add
   prorated  revenues  together;  then sum them with GRAF to arrive at AGR. Use
   one or both of the following methods, as appropriate:
   a. STFP  shall  be the  method  used to  prorate  alpine  revenue.  The STFP
      direction  contained  in FSM  2715.11c  effective  in 1992 shall be used.
      Include  in  the  calculation  only  uphill  devices  (lifts,  tows,  and
      tramways) that are  fundamental to the winter sports  operation  (usually
      those located on both Federal and private  land).  Do not include  people
      movers whose primary  purpose is to shuttle people between  parking areas
      or between parking areas and lodges and offices.
   b. Nordic trail length is the method used to prorate nordic revenue. Use the
      percentage of trail length on National Forest System lands to total trail
      length.
6. GRAF is the revenue from ancillary facilities, including all of the holder's
   or  subholder's  lodging,  food service,  rental shops,  parking,  and other
   ancillary operations located on National Forest System lands. Do not include
   revenue that is generated on private land. For facilities that are partially
   located on National Forest System lands, calculate the ratio of the facility
   square footage located on National Forest System lands to the total facility
   square footage.  Special event revenue allocatable to GRAF shall be prorated
   by the ratio of use on National Forest System lands to the total use.
7. In cases  when the  holder has no AGR for a given  fiscal  year,  the holder
   shall pay a permit fee of $2 per acre for National Forest System lands under
   permit or a percentage  of the  appraised  value of National  Forest  System
   lands under permit, at the discretion of the authorized officer.
B. Fee Payments.  Reports and deposits shall be tendered in accordance with the
   following  schedule.  They  shall  be sent or  delivered  to the  collection
   officer,  USDA,  Forest Service,  at the address furnished by the authorized
   officer.  Checks or money  orders  shall be made  payable to:  USDA,  Forest
   Service.

   1. The holder shall  calculate and submit an advance payment which is due by
      the beginning of the holder's  payment cycle.  The advance  payment shall
      equal 20  percent of the  holder's  average  permit  fee for 3  operating
      years, when available. When past permit fee information is not available,
      the advance
<PAGE>

      payment  shall  equal 20 percent of the  permit  fee,  based on the prior
      holder's  average fee or  projected  AGR.  For ski areas not  expected to
      generate AGR for a given payment cycle, advance payment of the permit fee
      as  calculated  in item A,  paragraph 7 ($2 per acre for National  Forest
      System  lands under  permit or a  percentage  of the  appraised  value of
      National  Forest  System lands under  permit,  at the  discretion  of the
      authorized  officer) shall be made. The advance payment shall be credited
      (item B,  paragraph  3)  toward  the total  ski area  permit  fee for the
      payment cycle.
   2. The holder shall report  sales,  calculate  fees due based on a tentative
      percentage  rate, and make interim  payments each calendar MONTH,  except
      for periods in which no sales take place and the holder has  notified the
      authorized officer that the operation has entered a seasonal shutdown for
      a specific  period.  Reports and payments shall be made by the end of the
      month following the end of each reportable period. Interim payments shall
      be credited  (item B,  paragraph  3) toward the total ski area permit fee
      for the payment cycle.
   3. Within 90 days  after  the close of the ski  area's  payment  cycle,  the
      holder shall provide a financial statement,  including a completed permit
      fee  information  form,  Form  FS-2700-19a,  representing  the ski area's
      financial  condition  at the  close of its  business  year and an  annual
      operating  statement  reporting  the results of  operations,  including a
      final payment which includes year-end adjustments for the holder and each
      subholder  for the same  period.  Any balance that exists may be credited
      and applied  against the next payment due or refunded,  at the discretion
      of the permit holder.
   4. Within 30 days of receipt of a  statement  from the Forest  Service,  the
      holder  shall make any  additional  payment  required  to ensure that the
      correct ski area permit fee is paid for the past year's operation.
   5. Payments  shall  be  credited  on the  date  received  by the  designated
      collection  officer.  If the due  date  for  the  fee or fee  calculation
      financial statement falls on a non-workday,  the charges shall not accrue
      until the close of business on the next workday.
   6. All permit fee calculations and records of sales are subject to review or
      periodic  audit  as  determined  by the  authorized  officer.  Errors  in
      calculation or payment shall be corrected as needed for conformance  with
      those reviews or audits.  In  accordance  with the Interest and Penalties
      clause contained in this  authorization,  interest and penalties shall be
      assessed on additional fees due as a result of reviews or audits.
   7. Correction  of errors  includes any action  necessary  to  calculate  the
      holder's  sales or slope  transport  fee  percentage or to make any other
      determination  required  to  calculate  permit fees  accurately.  For fee
      calculation purposes, an error may include:
      a. Misreporting or misrepresentation of amounts;
      b. Arithmetic mistakes;
      c. Typographic mistakes; or
      d. Variation from generally accepted  accounting  principles (GAAP), when
         such variations are inconsistent with the terms of this permit.
      Correction  of errors shall be made  retroactively  to the date the error
      was made or to the previous audit period,  whichever is more recent,  and
      past fees shall be adjusted accordingly.
C. Interest and Penalties.
   1. Pursuant  to 31 USC  3717  and 7 CFR  Part 3,  Subpart  B, or  subsequent
      changes  thereto,  interest  shall be  charged on any fee not paid by the
      date the fee or fee calculation  financial  statements  specified in this
      permit was due.
   2. Interest  shall be assessed using the higher of (1) the most current rate
      prescribed  by the United  States  Department  of the Treasury  Financial
      Manual (TFM-6-8025.40),  or (2) the prompt payment rate prescribed by the
      United States Department of the Treasury under section 12 of the Contract
      Disputes  Act of 1978 (41 USC 611).  Interest  shall accrue from the date
      the fee or fee calculation  financial  statement is due. In the event the
      account becomes delinquent,  administrative costs to cover processing and
      handling of the delinquent debt may be assessed.
   3. A penalty of 6 percent  per year shall be  assessed on any fee overdue in
      excess  of 90 days,  and  shall  accrue  from  the due date of the  first
      billing or the date the fee calculation  financial statement was due. The
      penalty is in addition to interest  and any other  charges  specified  in
      item 2.
   4. Delinquent  fees and other charges shall be subject to all the rights and
      remedies   afforded  the  United  States  pursuant  to  federal  law  and
      implementing regulations. (31 U.S.C. 3711 et seq.).
D. Nonpayment.  Failure of the holder to make  timely  payments,  pay  interest
   charges  or any other  charges  when due,  constitutes  breach  and shall be
   grounds for termination of this  authorization.  This permit  terminates for
   nonpayment  of any monies  owed the United  States when more than 90 days in
   arrears.
E. Access to Records.  For the purpose of administering  this permit (including
   ascertaining that fees paid were correct and evaluating the propriety of the
   fee base), the holder agrees to make all of the accounting
<PAGE>

   books and supporting records to the business activities, as well as those of
   sublessees  operating  within the  authority of this permit,  available  for
   analysis by qualified representatives of the Forest Service or other Federal
   agencies  authorized  to review the  Forest  Service  activities.  Review of
   accounting books and supporting records shall be made at dates convenient to
   the holder and reviewers. Financial information so obtained shall be treated
   as  confidential  as  provided in  regulations  issued by the  Secretary  of
   Agriculture.  The  holder  shall  retain  the  above  records  and keep them
   available for review for 5 years after the end of the year involved,  unless
   disposition is otherwise approved by the authorized officer in writing.
F. Accounting  Records.  The holder shall follow Generally Accepted  Accounting
   Principles  or Other  Comprehensive  Bases of  Accounting  acceptable to the
   Forest Service in recording financial  transactions and in reporting results
   to the authorized  officer.  When requested by the authorized  officer,  the
   holder at own expense,  shall have the annual accounting  reports audited or
   prepared  by a  licensed  independent  accountant  acceptable  to the Forest
   Service.  The holder  shall  require  sublessees  to comply  with these same
   requirements. The minimum acceptable accounting system shall include:
   1. Systematic  internal controls and recording by kind of business the gross
      receipts  derived  from all  sources  of  business  conducted  under this
      permit.  Receipts  should be recorded  daily and, if possible,  deposited
      into a bank account without reduction by  disbursements.  Receipt entries
      shall be supported by source documents such as cash-register  tapes, sale
      invoices, rental records, and cash accounts from other sources.
   2. A permanent record of investments in facilities  (depreciation schedule),
      and current source documents for acquisition costs of capital items.
   3. Preparation  and  maintenance of such special records and accounts as may
      be specified by the authorized officer.

VII.  TRANSFER AND SALE.

A. Subleasing. The holder may sublease the use of land and improvements covered
   under this permit and the operation of concessions and facilities authorized
   upon prior written  notice to the  authorized  officer.  The Forest  Service
   reserves the right to disapprove subleasees. In any circumstance, only those
   facilities  and activities  authorized by this permit may be subleased.  The
   holder shall continue to be responsible  for compliance  with all conditions
   of this permit by persons to whom such  premises  may be sublet.  The holder
   may not sublease  direct  management  responsibility  without  prior written
   approval by the authorized officer.
B. Notification  of Sale.  The holder shall  immediately  notify the authorized
   officer when a sale and transfer of ownership of the permitted  improvements
   is planned.
C. Divestiture  of  Ownership.  Upon  change  in  ownership  of the  facilities
   authorized by this permit,  the rights granted under this  authorization may
   be  transferred  to the new owner upon  application  to and  approval by the
   authorized officer. The new owner must qualify and agree to comply with, and
   be bound by the terms  and  conditions  of the  authorization.  In  granting
   approval,  the  authorized  officer  may modify the terms,  conditions,  and
   special  stipulations  to reflect  any new  requirements  imposed by current
   Federal  and state land use plans,  laws,  regulations  or other  management
   decisions.

VIII. TERMINATION.

A. Termination for Higher Public Purpose. If, during the term of this permit or
   any extension  thereof,  the Secretary of Agriculture or any official of the
   Forest  Service acting by or under his or her authority  shall  determine by
   his or her  planning  for the uses of the  National  Forest  that the public
   interest  requires  termination of this permit,  this permit shall terminate
   upon one  hundred-eighty  (180) day's  written  notice to the holder of such
   determination, and the United States shall have the right thereupon, subject
   to Congressional  authorization and appropriation,  to purchase the holder's
   improvements,  to remove them,  or to require the holder to remove them,  at
   the option of the United States. The United States shall be obligated to pay
   an  equitable  consideration  for the  improvements  or for  removal  of the
   improvements and damages to the  improvements  resulting from their removal.
   The amount of the  consideration  shall be fixed by mutual agreement between
   the United States and the holder and shall be accepted by the holder in full
   satisfaction  of all claims  against the United  States  under this  clause:
   Provided,  that if mutual agreement is not reached, the Forest Service shall
   determine the amount, and if the holder is dissatisfied with the amount thus
   determined to be due him may appeal the determination in accordance with the
   Appeal  Regulations,  and the amount as  determined on appeal shall be final
   and  conclusive  on the  parties  hereto;  Provided  further,  that upon the
   payment to the holder of 75% of the amount fixed by the Forest Service,  the
   right of the
<PAGE>

   United States to remove or require the removal of the improvements shall not
   be stayed pending the final decision on appeal.
B. Termination,  Revocation and Suspension. The authorized officer may suspend,
   revoke,  or  terminate  this permit for (1)  noncompliance  with  applicable
   statutes, regulations, or terms and conditions of the authorization; (2) for
   failure of the holder to exercise  the rights and  privileges  granted;  (3)
   with the consent of the holder;  or (4) when,  by its terms,  a fixed agreed
   upon condition,  event, or time occurs. Prior to suspension,  revocation, or
   termination,  the authorized officer shall give the holder written notice of
   the  grounds  for  such  action  and  reasonable  time to  correct  cureable
   noncompliance.

IX. RENEWAL.

A. Renewal.  The authorized use may be renewed.  Renewal requires the following
   conditions:  (1) the land use allocation is compatible  with the Forest Land
   and Resource  Management  Plan;  (2) the site is being used for the purposes
   previously  authorized and; (3) the enterprise is being continually operated
   and  maintained in  accordance  with all the  provisions  of the permit.  In
   making a renewal,  the authorized officer may modify the terms,  conditions,
   and special stipulations.

X. RIGHTS AND RESPONSIBILITIES UPON TERMINATION OR NONRENEWAL.

A. Removal  of  Improvements.  Except  as  provided  in  Clause  VIII.  A, upon
   termination or revocation of this special use permit by the Forest  Service,
   the holder  shall  remove  within a reasonable  time as  established  by the
   authorized officer,  the structures and improvements,  and shall restore the
   site to a condition satisfactory to the authorized officer, unless otherwise
   waived in writing or in the authorization. If the holder falls to remove the
   structures or improvements  within a reasonable period, as determined by the
   authorized  officer,  they shall  become the  property of the United  States
   without  compensation to the holder, but that shall not relieve the holder's
   liability for the removal and site restoration costs.

Xl. MISCELLANEOUS PROVISIONS.

A. Members of  Congress.  No Member of or  Delegate  to  Congress,  or Resident
   Commissioner  shall be admitted to any share or part of this agreement or to
   any benefit that may arise herefrom unless it is made with a corporation for
   its general benefit.
B. Inspection,  Forest  Service.  The Forest Service shall monitor the holder's
   operations  and reserves the right to inspect the permitted  facilities  and
   improvements  at any time for  compliance  with  the  terms of this  permit.
   Inspections   by  the  Forest   Service  do  not   relieve   the  holder  of
   responsibilities under other terms of this permit.
C. Regulating  Services and Rates.  The Forest Service shall have the authority
   to check and regulate the adequacy and type of services  provided the public
   and to require that such services  conform to  satisfactory  standards.  The
   holder  may be  required  to  furnish a  schedule  of  prices  for sales and
   services authorized by the permit. Such prices and services may be regulated
   by the Forest  Service:  Provided,  that the holder shall not be required to
   charge prices  significantly  different  than those charged by comparable or
   competing enterprises.
D. Advertising.  The holder, in advertisements,  signs,  circulars,  brochures,
   letterheads,  and like materials,  as well as orally, shall not misrepresent
   in any way either the accommodations  provided, the status of the permit, or
   the area covered by it or the vicinity.  The fact that the permitted area is
   located on the National Forest shall be made readily  apparent in all of the
   holder's brochures and print advertising regarding use and management of the
   area and facilities under permit.
E. Bonding.  The authorized officer may require the holder to furnish a bond or
   other security to secure all or any of the obligations  imposed by the terms
   of the authorization or any applicable law, regulation, or order.
F. Water Rights.  This  authorization  confers no rights to the use of water by
   the  holder.  Such rights  must be  acquired  under  State law.
G. Current  Addresses.  The  holder  and the  Forest  Service  shall  keep each
   informed of current mailing addresses  including those necessary for billing
   and payment of fees.
H. Identification  of  Holder.   Identification  of  the  holder  shall  remain
   sufficient  so that the Forest  Service  shall know the true identity of the
   entity.
<PAGE>

   Corporation Status Notification:
   1. The holder shall notify the  authorized  officer within fifteen (15) days
      of the following changes:
      a. Names of officers appointed or terminated.
      b. Names of stockholders who acquire stock shares causing their ownership
         to exceed 50 percent of shares issued or otherwise acquired, resulting
         in gaining controlling interest in the corporation.
   2. The holder shall furnish the authorized officer:
      a. A copy of the articles of incorporation and bylaws.
      b. An  authenticated  copy of a  resolution  of the  board  of  directors
         specifically  authorizing  a  certain  individual  or  individuals  to
         represent the holder in dealing with the Forest Service.
      c. A list  of  officers  and  directors  of  the  corporation  and  their
         addresses.
      d. Upon request,  a certified  list of  stockholders  and amount of stock
         owned by each.
      e. The  authorized  officer may require the holder to furnish  additional
         information as set forth in 36 CFR 251.54(e)(1)(iv).

   Partnership  Status  Notification:  The holder shall  notify the  authorized
   officer  within  fifteen (15) days of the  following  changes.  Names of the
   individuals involved shall be included with the notification.
   1. Partnership  makeup  changes due to death,  withdrawal,  or addition of a
      partner.
   2. Party  or  parties  assigned  financed  interest  in the  partnership  by
      existing partner(s).
   3. Termination, reformation, or revision of the partnership agreement.
   4. The acquisition of partnership  interest,  either through  purchase of an
      interest from an existing partner or partners, or contribution of assets,
      that exceeds 50 percent of the partnership permanent investment.

I. Archaeological  Paleontological  Discoveries.  The holder shall  immediately
   notify the authorized officer of any and all antiquities or other objects of
   historic or  scientific  interest.  These  include,  but are not limited to,
   historic or  prehistoric  ruins,  fossils,  or artifacts  discovered  as the
   result of  operations  under this permit,  and shall leave such  discoveries
   intact until authorized to proceed by the authorized officer. Protective and
   mitigative  measures  specified  by  the  authorized  officer  shall  be the
   responsibility of the permit holder.
J. Protection of Habitat of  Endangered,  Threatened,  and  Sensitive  Species.
   Location of areas  needing  special  measures  for  protection  of plants or
   animals listed as threatened or endangered under the Endangered  Species Act
   (ESA) of 1973, as amended,  or listed as sensitive by the Regional  Forester
   under authority of FSM 2570, derived from ESA Section 7 consultation, may be
   shown on a separate map, hereby made a part of this permit, or identified on
   the ground.  Protective and mitigative  measures specified by the authorized
   officer  shall be the  responsibility  of the permit  holder.  If protection
   measures prove  inadequate,  if other such areas are  discovered,  or if new
   species are listed as Federally  threatened or endangered or as sensitive by
   the  Regional  Forester,  the  authorized  officer  may  specify  additional
   protection  regardless  of when such facts become  known.  Discovery of such
   areas by either party shall be promptly reported to the other party.
K. Superior Clauses.  In the event of any conflict between any of the preceding
   printed clauses or any prevision  thereof,  and any of the following clauses
   or any provision thereof, the preceding clauses shall control.
L  Ski Area Permit Fees. The Forest  Service shall adjust and calculate  permit
   fees  authorized  by this  permit to  reflect  any  revisions  to permit fee
   provisions  in 16 U.S.C.  497c or to comply  with any new  permit fee system
   based on fair market value that may be adopted by statute or otherwise after
   issuance of this permit.
M. Liquor Sales Permitted.  The sale of liquors or other intoxicating beverages
   is allowed in this permit.  However,  if  conditions  develop as a result of
   this  privilege  which,  in the judgment of the Forest officer in charge are
   undesirable,  the sale of such intoxicating beverages shall be discontinued.
   In the event that this action becomes necessary, the holder will be informed
   in writing by the Forest Service.
N. Superseded Permit. This permit replaces a special use permit issued to:

      Sierra-at-Tahoe, Inc.                December 3, 1996
   ----------------------------------------------------------------------------
          (Holder Name)                        (Date)

O. The  Forest  Service   representative   for  this  special  use  permit  is:
   Placerville District Ranger.

P. Disputes. Appeal of any provisions of this authorization or any requirements
   thereof shall be subject to the appeal regulations at 36 CFR 251, Subpart C,
   or revisions  thereto.  The procedures for these appeals are set forth in 36
   CFR 251 published in the Federal Register at 54 FR 3362, January 23, 1989.

Note: Additional  provisions may be added by the authorized  officer to reflect
local conditions.
<PAGE>

   According to the Paperwork Reduction Act of 1995, no persons are required to
   respond  to a  collection  of  information  unless it  displays  a valid OMB
   control number. The valid OMB control number for this information collection
   is 0596-0082.

   This information is needed by the Forest Service to evaluate requests to use
   National  Forest  System  lands and manage  those  lands to protect  natural
   resources,  administer  the use, and ensure public  health and safety.  This
   information  is required to obtain or retain a benefit.  The  authority  for
   that requirement is provided by the Organic Act of 1897 and the Federal Land
   Policy  and  Management  Act of  1976,  which  authorize  the  Secretary  of
   Agriculture to promulgate rules and regulations for authorizing and managing
   National  Forest System lands.  These  statutes,  along with the Term Permit
   Act, National Forest Ski Area Permit Act,  Granger-Thye Act, Mineral Leasing
   Act,  Alaska Term Permit Act,  Act of  September  3, 1954,  Wilderness  Act,
   National   Forest   Roads  and  Trails  Act,   Act  of  November  16,  1973,
   Archeological  Resources  Protection Act, and Alaska National Interest Lands
   Conservation   Act,   authorize  the  Secretary  of   Agriculture  to  issue
   authorizations  for the use and  occupancy of National  Forest System lands.
   The Secretary of  Agriculture's  regulations at 36 CFR Part 251,  Subpart B,
   establish procedures for issuing those authorizations.

   The Privacy Act of 1974 (5 U.S.C.  552a) and the Freedom of Information  Act
   (5 U.S.C.  552) govern the  confidentiality  to be provided for  information
   received by the Forest Service.

   Public  reporting  burden for this collection of information is estimated to
   average  12  hours  per   response,   including   the  time  for   reviewing
   instructions, searching existing data sources, gathering and maintaining the
   data needed,  and completing  and reviewing the  collection of  information.
   Send  comments  regarding  this burden  estimate or any other aspect of this
   collection of information,  including  suggestions for reducing this burden,
   to  Department  of  Agriculture,  Clearance  Officer,  OIRM,  AG  Box  7630,
   Washington D.C. 20250; and to the Office of Management and Budget, Paperwork
   Reduction Project (OMB #0596-0082), Washington, D.C. 20503.
<PAGE>

                                   EXHIBIT A
                                  January 1999

      Activities, Improvements and Services Included in Special Use Permit

      Authorized activities on National Forest land:

        1.  Safety Patrol
        2.  Summer and winter slope grooming; erosion control
        3.  Ski instruction
        4.  Avalanche protection
        5.  Snowmaking
        6.  Food, retail, liquor, and rental service
        7.  Ski Races
        8.  Public skiing
        9.  Emergency first aid treatment
        10. Snowboarding
        11. Tubing
        12. Annually authorized concessions
        13. Special events, annually authorized
        14. Terrain parks
        15. Approved sliding devices

      Authorized uphill conveyance systems on National Forest land:

        1.  Rock Garden double chair lift
        2.  Nob Hill double chair lift
        3.  Tahoe King double chair lift
        4.  El Dorado double chair lift
        5.  Short Stuff double chair lift
        6.  Puma triple chair lift
        7,  Grandview detachable quad chair lift and chair storage
        8.  West Bowl detachable quad chair lift and chair storage
        9.  Easy Rider detachable quad chair lift and chair storage
        10. Magic Carpet conveyance
        11. Tubing tow
        12. Wild Mountain tow

      Authorized buildings and improvements (existing) on National Forest land:

        1.  Lodge #1 (Base Lodge)
        2.  Lodge #2 (Grandview Lodge)
        3.  Equipment and maintenance shop (Upper) with diesel pump
        4.  Equipment and maintenance shop (Lower) with diesel/gasoline pumps,
            storage
        5.  Access road (2.5 miles)
        6.  Parking lots (6 bays)
        7.  Interior service roads
        8.  Administrative/Children's Ski School Building
        9.  Pump House and associated snowmaking facilities
        10. Utilities- gas, electric, water, sewage, telephone, television,
            two-way radio
        11. Generator House (Lower & Upper)
        12. Ski/snowboard check
        13. Club vertical facilities
<PAGE>

                               EXHIBIT A. (cont.)

        14. Ski School warming hut and practice chairs
        15. Ski School Building
        16. West Bowl Base food and services
        17. Water tank and building
        18. Kiosks (Grandview, Host information)
        19. Borrow area
        20. Various mountain and base area signs
        21. Retaining walls
        22. Beverage carts
        23. Ski Patrol Buildings
        24. Wild Mountain Sprung Structures and training areas
        25. Tubing storage & services trailer

      Development, maintenance, and mechanical grooming of the following ski
      runs:

      1.  Aspen                 18. Escape              35. Sugar N' Spice
      2.  Aspen West            19. Hemlock             36. Sunshine Alley
      3.  Avalanche Bowl        20. Horsetail           37. Upper Main
      4.  Bashful               21. Jackrabbit          38. Upper Sleighride
      5.  Bear                  22. Lobo                39. Upper Snowshoe
      6.  Beaver                23. Lower Main          40. Wagon Train
      7.  Broadway              24. Lower Sleighride
      8.  Castle                25. Lower Snowshoe
      9.  Chute                 26. Marten
      10. Clipper               27. Marmot
      11. Corkscrew             28. Powderhorn
      12. Coyote                29. Preacher's Passion
      13. Dogwood               30. Pyramid
      14. Dynamite              31. Royal Trail
      15. East About            32. Shortswing
      16. Echo                  33. Smokey
      17. Ego                   34. Spur
<PAGE>
                                   EXHIBIT B

                                SIERRA-AT-TAHOE
                             WINTER SPORTS RESORT
                              SPECIAL USE PERMIT

Graphic of MAP NOVMEBER 1996 - Portions of Eldorado  National  Forest in T.11N,
R.17E, M.D.B. & M. omitted.

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