RALCORP HOLDINGS INC, 10-Q, 1996-08-14

RALCORP HOLDINGS INC
10-Q, 1996-08-14
GRAIN MILL PRODUCTS

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<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY
PERIOD ENDED JUNE 30, 1996.

( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION
PERIOD FROM ---------- TO ------------.

Commission file number: 1-12766

RALCORP HOLDINGS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

Missouri 43-1664297
(State of Incorporation) (I.R.S. Employer
Identification No.)

800 Market Street, Suite 2900
St. Louis, MO 63101
(Address of principal (Zip Code)
executive offices)

(314) 877-7000
(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes (x) No ( )

Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date.

Common Stock Outstanding Shares at
par value $.01 per share July 12, 1996
32,924,347

<PAGE> 2

RALCORP HOLDINGS, INC.

<TABLE>
INDEX

<CAPTION>
PART I. FINANCIAL INFORMATION PAGE
----
<S> <C>
Consolidated Statement of Earnings

Condensed Consolidated Balance Sheet

Condensed Consolidated Statement of Cash Flows

Notes to Condensed Financial Statements

Management's Discussion and Analysis of Financial Condition
and Results of Operations

PART II. OTHER INFORMATION

Other Information

Exhibits and Reports on Form 8-K

</TABLE>

(i)
<PAGE> 3

PART I - FINANCIAL INFORMATION
<TABLE>
RALCORP HOLDINGS, INC.
CONSOLIDATED STATEMENT OF EARNINGS
(Dollars in millions except per share data)
<CAPTION>
Three Months Ended Nine Months Ended
June 30, June 30,
1996 1995 1996 1995
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net Sales $ 230.1 $ 231.5 $ 802.8 $ 768.2
--------- --------- --------- ---------

Costs and Expenses
Cost of products sold 126.6 126.1 408.3 393.4
Selling, general and administrative 44.6 37.3 132.5 120.2
Advertising and promotion 58.1 52.8 189.2 161.1
Interest 6.8 7.0 20.2 21.2
Restructuring charge 20.7 20.7
--------- --------- --------- ---------
256.8 223.2 770.9 695.9
--------- --------- --------- ---------
Earnings before Income Taxes (26.7) 8.3 31.9 72.3
Income Taxes (10.4) 3.2 12.3 28.2
--------- --------- --------- ---------

Net Earnings $ (16.3) $ 5.1 $ 19.6 $ 44.1
========= ========= ========= =========

Earnings per Common Share $ (.50) $ .15 $ .59 $ 1.31
========= ========= ========= =========

See Accompanying Notes to Condensed Financial Statements.

</TABLE>

1
<PAGE> 4

<TABLE>
RALCORP HOLDINGS, INC.
CONSOLIDATED BALANCE SHEET
(Condensed)
(Dollars in millions)
<CAPTION>
June 30, Sept. 30,
1996 1995
-------- ---------
<S> <C> <C>
ASSETS
Current Assets
Cash $ - $ -
Receivables, less allowance for doubtful accounts
of $1.8 and $.8, respectively 87.5 86.3
Inventories -
Raw materials and supplies 26.6 33.4
Finished products 80.2 76.7
Prepaid expenses 9.9 11.1
--------- --------
Total Current Assets 204.2 207.5
--------- --------

Investments and Other Assets 89.0 91.6
--------- --------

Property at Cost 713.7 669.3
Accumulated depreciation 284.1 252.2
--------- --------
429.6 417.1
--------- --------

Total $ 722.8 $ 716.2
========= ========

LIABILITIES AND SHAREHOLDERS EQUITY
Current Liabilities
Current maturities of long-term debt $ 1.8 $ 1.8
Accounts payable 45.5 69.4
Other current liabilities 67.4 33.4
--------- --------
Total Current Liabilities 114.7 104.6
--------- --------

Long-Term Debt 373.8 395.4
--------- --------
Deferred Income Taxes 19.9 20.2
--------- --------
Other Liabilities 40.6 33.6
--------- --------
Shareholders Equity
Common stock .3 .3
Capital in excess of par value 131.0 131.0
Retained earnings 66.2 46.6
Common stock in treasury, at cost (22.6) (13.8)
Unearned portion of restricted stock (1.1) (1.7)
--------- --------
Total Shareholders Equity 173.8 162.4
--------- --------
Total $ 722.8 $ 716.2
========= ========

See Accompanying Notes to Condensed Financial Statements.
</TABLE>

2
<PAGE> 5

<TABLE>
RALCORP HOLDINGS, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Condensed)
(Dollars in millions)
<CAPTION>
Nine Months Ended
June 30,
1996 1995
---------- ----------
<S> <C> <C>
Cash Flow from Operations
Net earnings $ 19.6 $ 44.1
Non-cash items included in income 34.4 37.9
Restructuring charge 20.7
Changes in assets and liabilities used in operations (1.2) (11.5)
Other, net 7.7 4.0
---------- ----------
Net cash flow from operations 81.2 74.5
---------- ----------

Cash Flow from Investing Activities
Property additions, net (46.5) (38.6)
Other, net (4.6) (4.2)
---------- ----------
Net cash used by investing activities (51.1) (42.8)
---------- ----------

Cash Flow from Financing Activities
Net payments on long-term borrowings (21.6) (19.8)
Repurchases of common stock (8.5) (11.9)
---------- ----------
Net cash used by financing activities (30.1) (31.7)
---------- ----------

Net Increase in Cash and Cash Equivalents - -
Cash and Cash Equivalents, Beginning of Year
---------- ----------

Cash and Cash Equivalents, End of Period $ - $ -
========== ==========

See Accompanying Notes to Condensed Financial Statements.
</TABLE>

3
<PAGE> 6

RALCORP HOLDINGS, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 1996
(Dollars in millions except per share data)

NOTE 1 - PRESENTATION OF CONDENSED FINANCIAL STATEMENTS

The accompanying unaudited financial statements have
been prepared in accordance with the instructions for
Form 10-Q and do not include all of the information
and footnotes required by generally accepted
accounting principles for complete financial
statements. In the opinion of management, all
adjustments, consisting only of normal recurring
adjustments considered necessary for a fair
presentation, have been included. Operating results
for any quarter are not necessarily indicative of the
results for any other quarter or for the full year.
These statements should be read in connection with the
financial statements and notes included in the
Company's Annual Report to Shareholders for the year
ended September 30, 1995.

NOTE 2 - RESTRUCTURING CHARGE

During the quarter ended June 30, 1996, the Company
recorded a pre-tax charge of $20.7 ($12.7 after
taxes or $.39 per common share) to recognize the
costs related to the restructuring of its ready-to-
eat cereal subsidiary, Ralston Foods. As a result
of this restructuring plan, approximately 100
positions have been eliminated from the Ralston
Foods subsidiary and corporate support groups,
primarily at the Company's headquarters in St.
Louis. In addition, the restructuring plan includes
the partial closing of the Ralston Foods production
facility in Battle Creek, MI, thereby reducing
excess production capacity in the Ralston Foods
system and eliminating approximately 190 jobs from
the production and administrative staffs at that
facility. Company management currently anticipates
that all restructuring activities will be completed
by the end of the Company's current fiscal year,
which is September 30, 1996.

The components of the restructuring charge are
summarized in the following table.

Amount of Amount Balance of
Charge Utilized Reserve
------ -------- -------
<S> <C> <C> <C>
Salaries, severance and benefits $ 9.5 $ - $ 9.5
Asset writedowns 7.3 5.8 1.5
Other 3.9 - 3.9
-------- -------- --------
Total restructuring charge $ 20.7 $ 5.8 $ 14.9
======== ======== ========
</TABLE>

NOTE 3 - EARNINGS PER SHARE

Earnings per common share for the quarter and nine
month periods ended June 30, 1996 and 1995 are
computed by using the average number of shares of
Ralcorp Common Stock outstanding for the periods then
ended. Earnings per common share is computed
independently for all of the periods presented,
therefore, the sum of earnings per common share
amounts for the quarters may not total the year-to-
date. The weighted average numbers of common shares
used for all periods are as follows:

Quarter ended June 30, 1996...............................32,933,000
Quarter ended June 30, 1995...............................33,439,000
Nine months ended June 30, 1996...........................33,022,000
Nine months ended June 30, 1995...........................33,606,000

Actual outstanding shares of Ralcorp Common Stock at
June 30, 1996 were 32,921,000.

<PAGE> 7

RALCORP HOLDINGS, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 1996
(Dollars in millions except per share data)

<TABLE>
NOTE 4 - OTHER CURRENT LIABILITIES consists of the following:

<CAPTION>
June 30, Sept. 30,
1996 1995
---------- -----------
<S> <C> <C>
Accrued advertising and promotion $ 23.0 $ 3.1
Restructuring reserve 14.9
Other items 29.5 30.3
--------- --------
$ 67.4 $ 33.4
========= ========
</TABLE>

NOTE 5 - LONG-TERM DEBT

The Company continues to have available certain
borrowings under a bank credit agreement (the Agreement).
Provisions of the Agreement require that the Company
maintains certain financial ratios and a minimum level of
shareholders' equity. There is $275 available under the
Agreement, as amended in March 1996, all of which is
placed in a revolving credit facility with a maturity
date of March 12, 2001.

<TABLE>
At June 30, 1996 and September 30, 1995, long-term debt
associated with the Company's businesses consisted of the
following:

<CAPTION>
June 30, Sept. 30,
1996 1995
---------- -----------
<S> <C> <C>
8.75% Notes due 2004 $ 150.0 $ 150.0
Bank Credit Agreement 195.5 217.1
10.85% and 11.15% Notes due 9/30/96,
9/30/97 and 9/30/98 4.5 4.5
Refunding Revenue Bonds Series 90
7.20%-7.875% due 9/2/98, 9/1/06 and 9/1/08 20.4 20.4
Refunding Revenue Bonds Series 91
7.125% and 7.375% due 9/1/02 and 9/1/10 3.0 3.0
Other 2.2 2.2
---------- ----------
375.6 397.2
---------- ----------
Less current portion (1.8) (1.8)
---------- ----------
$ 373.8 $ 395.4
========== ==========

NOTE 6 - RECLASSIFICATIONS

Certain reclassifications of the prior year's amounts
have been made to conform with the current year's
presentation.

<PAGE> 8

RALCORP HOLDINGS, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 1996
(Dollars in millions except per share data)

NOTE 7 - SUBSEQUENT EVENTS

On August 14, 1996, the Company announced the sale of its
branded ready-to-eat cereal and cereal based snack mix
businesses to General Mills, Inc. for General Mills
common stock and the assumption of up to $300 million,
principal amount, of the Company's indebtedness, together
valued at $570 million. Currently, the Company estimates
that the debt assumed will be between $210 million to
$240 million. The transaction will use a tax-free reorganization
structure that includes the merger of the Company's branded
ready-to-eat cereal and cereal based snack mix businesses with
a subsidiary of General Mills and the spin-off of the Company's
remaining private label ready-to-eat and hot cereals, baby food,
private label cracker and cookie and the Resorts Operations
(or remaining interest therein subject to the disclosure below)
businesses to the Company's shareholders. Subsequent to the
close of the transaction, shareholders of the Company will hold
shares of General Mills common stock and shares of the spun-off
company. The completion of the transaction is subject to various
government approvals and the approval by Ralcorp shareholders,
which may or may not be received.

Subsequent to June 30, 1996, the Company announced it
reached a definitive agreement to sell its Ralston
Resorts ski subsidiary to Vail Resorts, Inc., for
stock and assumed debt, the combined value of which is
in excess of $310. The transaction, which has been
approved by the Company's Board of Directors, would be
comprised of an approximate 24 percent retained
ownership interest by the Company in the newly
combined ski company as well as the assumption of $165
in Company debt by the newly formed entity. The
completion of this transaction is subject to certain
government approvals, which may or may not be
received.

<PAGE> 9

RALCORP HOLDINGS, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

SUBSEQUENT EVENTS

On July 23, 1996, the Company announced the sale of its
resorts operations to Vail Resorts in a transaction valued in
excess of $310 million. The sale allows the Company to
significantly reduce its corporate debt by $165 million and
also retain an approximate 24% ownership interest in the newly
combined ski resort that will feature five of the premier ski
resorts in North America. The completion of the transaction
is subject to various government approvals, which may or may
not be received.

HIGHLIGHTS

For the quarter ended June 30, 1996, the Company recorded
sales of $230.1 million and a net loss, excluding a charge
related to restructuring of the Company's cereal operations,
of $3.6 million. For the comparable prior year period, sales
were $231.5 million and net earnings were $5.1 million.
Operations for the three months ended June 30, 1996 resulted
in a loss per share, excluding the charge, of $.11 compared to
earnings per share of $.15 in the prior year quarter. During
the current year quarter, the Company recorded a pre-tax
restructuring charge of $20.7 million ($12.7 million after-tax
or $.39 per share) to recognize the costs related to the
restructuring of its ready-to-eat cereal subsidiary, Ralston
Foods. The charge is reflected on the accompanying
Consolidated Statement of Earnings. As a result of the
restructuring plan, approximately 100 positions have been
eliminated from the Ralston Foods subsidiary and corporate
support groups, primarily at the Company's headquarters in St.
Louis. In addition, the restructuring plan includes the
partial closing of the Ralston Foods production facility in
Battle Creek, MI, thereby reducing excess production capacity
in the Ralston Foods system and eliminating approximately 190
jobs from the production and administrative staffs at that
facility.

For the first nine months of the current fiscal year, sales
and net earnings, excluding the aforementioned restructuring
charge, were $802.8 million and $32.3 million compared to
sales and net earnings of $768.2 million and $44.1 million,
respectively, in the same prior year period. The
restructuring charge reduced net earnings and earnings per
share for the nine months ended June 30, 1996 to $19.6 million
and $.59, respectively.

</TABLE>
<TABLE>
BUSINESS SEGMENT INFORMATION
(in millions)
<CAPTION>
Three Months Ended June 30
--------------------------

Sales Operating Profit
-------------------------- -----------------------------
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Consumer Foods $ 212.5 $ 214.1 $ 8.3 <F*> $ 22.1
Resort Operations 17.6 17.4 (6.3) (5.2)
------------ ------------ ------------ ------------

Total $ 230.1 $ 231.5 $ 2.0 $ 16.9
============ ============ ============ ============

<CAPTION>
Nine Months Ended June 30
-------------------------

Sales Operating Profit
-------------------------- -----------------------------
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Consumer Foods $ 681.3 $ 654.0 $ 45.3 <F*> $ 73.7
Resort Operations 121.5 114.2 31.9 25.8
------------ ------------ ------------ ------------

Total $ 802.8 $ 768.2 $ 77.2 $ 99.5
============ ============ ============ ============

<FN>
<F*> Excluded from the three and nine month periods ended June 30, 1996
is a $20.7 million pre-tax charge related to the restructuring of
the Company's cereal subsidiary.
</TABLE>

<PAGE> 10

CONSUMER FOODS

Consumer Foods sales decreased .8% or $1.6 million for the
three months ended June 30, 1996 over the comparable prior
year period, on declines in private label cereal volume and
continued volume declines in fractional share cereal brands.
The cereal volume declines are mostly offset by the
significant improvements in branded snack volume, favorable
pricing in cereals, volume increases in crackers and cookies
and slight pricing and volume improvements in baby foods. For
the quarter, the CHEX MIX snack product continued its strong
performance of the last year, increasing its volumes by
approximately 50% on a quarter-to-quarter basis. Branded
cereal volume was down for the current quarter compared to the
same quarter of the prior year as declines in fractional share
brands more than offset the virtually flat volume performance
of the Company's mainline CHEX cereals. Private label cereal
volume continued its decline due to continued heavy
promotional spending and reductions in prices by branded
competitors.

Sales in the Consumer Foods segment for the nine months ended
June 30, 1996 improved $27.3 million to $681.3 million for an
increase of 4.2% over the comparable year ago period. This
improvement can be attributed to higher branded snack volume,
favorable cereal and baby foods pricing and improved volume in
children's cereals, baby foods and crackers and cookies. The
volume improvement in children's cereal is attributable to the
Company's new SPIDER-MAN product, although at a rate
significantly below expectations for the product.

Consumer Foods operating profit for the quarter ended June 30,
1996, excluding the pre-tax restructuring charge, declined
$13.8 million due exclusively to lower results in cereals.
Operating profit for the baby foods and crackers and cookies
operations were flat on a quarter-to-quarter basis. The key
variables in the significant decline in segment operating
profit was an 8.7% private label cereal volume decline, a
result of significant competitive pressures, and an 8.0%
branded cereal volume drop, primarily in the fractional share
brands, compared to last year's third quarter. Also
negatively affecting operating profit for the Ralston Foods
cereals and snacks subsidiary was an increase in advertising
and promotion expense. The majority of the increase in
advertising and promotion expense in the quarter can be
attributed to promotional spending necessary to support the
position of Ralston Foods' private label cereals.

For the nine months, Consumer Foods operating profit fell
$28.4 million from year ago levels to $45.3 million, again
excluding the pre-tax restructuring charge, on lower cereal
results partially offset by improvements in baby food and
crackers and cookies. Operating profit for Ralston Foods
declined on higher advertising and promotion expense, the
continued increase in ingredient costs and higher information
systems costs, partially offset by the strong performance of
CHEX MIX snacks and favorable cereal prices. SPIDER-MAN
cereal, introduced in last fiscal year's fourth quarter,
continues to be an earnings disappointment with volumes
significantly below expectations. Beech-Nut and Bremner
posted strong operating profit gains year-over-year primarily
on significant volume improvements.

RESORT OPERATIONS

The Ralston Resorts operation recorded a $6.3 million
operating loss for the quarter ended June 30, 1996, compared
to an operating loss of $5.2 million for the same quarter last
fiscal year. The $1.1 million unfavorable comparison is
primarily due to lower overall skier visits resulting from
warm spring weather. This year's third quarter sales were
basically flat with the prior year's third quarter. For the
nine months ended June 30, 1996, operating profit increased
$6.1 million to $31.9 million compared to the same nine month
period of the prior fiscal year. Excellent ski conditions
during the key winter months resulted in increases in skier
visits and room nights of 5.4% and 3.9%, respectively,
compared to last year's first nine months. For the nine
months ended June 30, 1996, total skier visits were
approximately 2.7 million

Results for Resort Operations are highly seasonal.
Historically, more than the entire year's operating profit has
been earned during the Company's second fiscal quarter which
begins on January 1.

<PAGE> 11

RESULTS OF OPERATIONS

Cost of products sold as a percentage of sales was 55.0% for
the current year third quarter compared to 54.5% for the same
quarter of the prior year, and for the nine months ended June
30, 1996, decreased to 50.9% from 51.2% in the prior year
period. The quarterly increase in cost of products sold is
primarily due to higher ingredient costs, the effects of which
have been most significant on the Ralston Foods and Bremner
subsidiaries. The slight improvement in cost of products sold
between nine month periods is due to increased resort
operation revenues offset by higher ingredient costs.
Selling, general and administrative expense as a percent of
sales increased to 16.5% in the nine months of the current
year compared to 15.7% in the prior period primarily due to
higher information systems costs. Advertising and promotion
expenses for the nine months ended June 30, 1996 increased to
23.6% of sales from 21.0% in the prior year period and
increased to 25.3% of sales in the current year quarter from
22.8% for the same prior year period. A significant portion
of the year-to-date increase is due to spending associated
with SPIDER-MAN, a new branded cereal item, and stepped up
promotional spending necessary to protect the Company's
private label cereals position. The quarterly advertising and
promotion increase is a result of the promotional spending
necessary to support the Company's private label cereals. The
Company's private label cereal products have come under
pressure due to the heavy promotional spending and price
reductions by branded competitors. Income taxes were 38.7% of
earnings before income taxes in the current quarter compared
to 39.0% in the year ago period.

FINANCIAL CONDITION

The Company's primary source of liquidity is cash flow from
operations, which increased to $81.2 million for the nine
months ended June 30, 1996 compared to $74.5 million for the
same prior year period, primarily due to a current year
decline in inventory balances, partially offset by reduced
earnings. Net working capital, excluding cash and current
maturities of long-term debt, was $91.3 million at June 30,
1996 compared to $104.7 million at September 30, 1995.

Net property additions of $46.5 million for the first nine
months of fiscal 1996 include gross property additions of
$49.2 million, partially offset by proceeds of disposals,
compared to net additions of $38.6 million in the prior year
consisting of gross additions of $42.0 million, partially
offset by property disposals. During the first nine months of
the current year the Company repurchased $8.5 million of its
Common Stock compared to $11.9 million in the prior year. As
a result of activity during the nine months ended June 30,
1996, total debt declined by $21.6 million to $375.6 million
compared to $397.2 million at September 30, 1995. As a
percent of total capitalization, total debt improved in the
nine months to 68.4% compared to 71.0% at September 30, 1995.

On May 25, 1995, the Company's Board of Directors authorized
management to repurchase up to one million shares of the
Company's Common Stock from time to time as management
determines. As of August 14, 1996, the Company had
repurchased approximately 371,000 shares for $9.1 million
pursuant to such authorization.

OUTLOOK

The Company continues to be negatively affected by the
changing competitive environment featuring price reductions
and deep discounting by top branded cereal competitors. These
changes have resulted in an increase in the level of branded
cereal products being purchased at lower promoted prices, and
has caused a significant decline in the Company's private
label cereal volume. The combination of this private label
volume decline and the continued declining performance by
several of the Company's minor branded cereal products, create
a near term financial outlook for the Company's cereal
business that is unfavorable. Management believes the Company
will record an operating loss for the remainder of the fiscal
year.

The outlook for the remainder of the Company's businesses is
positive when viewed on an entire year basis. The Company's
Beech-Nut baby food business is expected to post improved
earnings year over year, however, recent competitive
activities have and could continue to limit some growth in the
second half of the year. The Bremner cracker and cookie
business continues to perform well, while Ralston

<PAGE> 12

Resorts will be much improved over the prior year, despite
operating at a loss in the fourth quarter, which is normal for
this seasonal business.

In light of the Company's earnings expectations, the Company
may violate a provision in its bank credit agreements
requiring it to meet specified interest and debt coverage ratios.
Management believes that prior to violating such
ratios, the Company will be able to renegotiate its
bank credit agreements, obtain a waiver of the pertinent
ratios, or obtain alternative financing at rates that may be
higher than under existing bank credit agreements.

CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS

Forward-looking statements, within the meaning of Section 21E
of the Securities and Exchange Act of 1934, are made
throughout this Management's Discussion and Analysis. The
Company's results of operations and liquidity status may
differ materially from those in the forward-looking
statements. Such statements are based on management's current
views and assumptions, and involve risks and uncertainties
that could affect expected results. For example any of the
following factors cumulatively or individually may impact
expected results:

(i) Key ingredient costs are at historical high prices
and further cost increases will negatively impact earnings;

(ii) During the reporting period the Company faced
significant price discount promotions by the largest branded
cereal manufacturers and the same or similar promotions in the
future may negatively impact earnings;

(iii) If the Company violates its interest or debt coverage
ratios discussed in the Outlook section above and the Company
is unable to secure waivers of the ratio or amendments to its
bank credit agreements, or obtain alternate sources of debt
financing, then the Company could be in default of its bank
credit agreements (and its 8 3/4% $150 million Notes due
September 15, 2004 by virtue of cross-default provisions
therein). In such event, the lenders under the bank
agreements (and the holders of the Notes) could accelerate
repayment of the full amount of the debt and interest
outstanding thereunder; and

(iv) If the Company renegotiates its bank credit
agreements or obtains alternate sources of financing, (a) the
Company could face additional or more restrictive covenants
preventing the Company from engaging in certain actions such
as, but not limited to, payment of dividends, repurchases of
stock, making acquisitions and incurring additional
indebtedness; and (b) the interest rates under such
alternative financing may be significantly higher than under
existing bank credit agreements.

<PAGE> 13

PART II. OTHER INFORMATION

There is no information required to be reported under any
items except those indicated below.

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits

10.1 Amendment dated June 26, 1996, to Amended and
Restated Credit Agreement (5-Year) dated as
of March 12, 1996

10.2 Amendment dated June 26, 1996, to Amended and
Restated Credit Agreement (364-Day) dated
as of March 12, 1996

10.3 Stock Purchase Agreement among Vail Resorts, Inc.,
Ralston Foods, Inc. and Ralston Resorts,
Inc. dated July 22, 1996 (Shareholder Agreement is
included as exhibit).

(b) Reports on Form 8-K

(i) On June 10, 1996, the Company filed a report on
Form 8-K announcing the elimination of
approximately 100 positions at its
headquarters.

(ii) On June 18, 1996, the Company filed a report on
Form 8-K announcing the elimination of
approximately 190 positions at its Battle
Creek, Michigan ready-to-eat cereal plant.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly
authorized.

RALCORP HOLDINGS, INC.

By: /s/ J.R. Micheletto
--------------------------------
J. R. Micheletto
Duly Authorized Signatory and
Chief Executive Officer and
Chief Financial Officer

10
<PAGE> 14

<TABLE>
EXHIBIT INDEX

<CAPTION>
Exhibit
Number Description
- - - ------- -----------

<C> <S>
10.1 Amendment dated June 26, 1996, to Amended
and Restated Credit Agreement (5-Year) Dated
as of March 12, 1996

10.2 Amendment dated June 26, 1996, to Amended
and Restated Credit Agreement (364-Day) Dated
as of March 12, 1996

10.3 Stock Purchase Agreement among Vail Resorts,
Inc., Ralston Foods, Inc. and Ralston Resorts, Inc.
dated July 22, 1996 (Shareholder Agreement is
included as exhibit)
</TABLE>

<PAGE> 1

NationsBank Corporate Center
Charlotte, NC 28255
Tel 704 386-5000
Fax 704 386-3271

June 26, 1996

NationsBank

Ralcorp Holdings, Inc.
800 Market Street
29th Floor
St. Louis, Missouri 63101

RE: Credit Agreement dated as of March 12, 1996 among
Ralcorp Holdings, Inc., the Lenders party thereto and
NationsBank, N.A., as Agent in respect of $175,000,000
Revolving Credit Facility (the "Credit Agreement")

Gentlemen:

Reference is made to the Credit Agreement described above, the
defined terms of which are incorporated herein by reference.

On behalf of the Required Lenders under the Credit Agreement, we
hereby agree with you to amend the Credit Agreement in the
following respects:

1. The definition of "Applicable Margin" set forth in
Section 1.01 of the Credit Agreement is amended in its
entirety to read as follows:

"Applicable Margin" shall mean, for purposes of
calculating the applicable interest rate for any day for any
Eurodollar Loan or the applicable rate of the Unused Fee for
any day for purposes of Section 2.05(a), the appropriate
applicable margin corresponding to the ratio described below
in effect as of the most recent Calculation Date:

<TABLE>
<CAPTION>
Applicable Applicable
Margin Margin
Pricing Consolidated Debt for for
Level Coverage Ratio Eurodollar Loans Unused Fee
- - - ------- ----------------- ---------------- ----------

<C> <S> <C> <C>
V Greater than 3.25 to 1.0 87.5 bps 27.5 bps

IV Equal to or less than 3.25 to 1.0 but greater than 2.75 to 1.0 60.0 bps 22.5 bps

III Equal to or less than 2.75 to 1.0 but greater than 2.25 to 1.0 45.0 bps 17.5 bps

II Equal to or less than 2.25 to 1.0 but greater than 1.75 to 1.0 40.0 bps 15.0 bps

I Equal to or less than 1.75 to 1.0 35.0 bps 12.5 bps
</TABLE>

USA
Official Sponsor
1994/1996 Member FDIC

<PAGE> 2

Ralcorp Holdings, Inc.
June 26, 1996
Page 2

The Applicable Margin as of the Closing Date is (i) 45 bps
for Eurodollar Loans and (ii) 17.5 bps for the Unused Fee.
Thereafter, determination of the appropriate Applicable
Margins based on the Consolidated Debt Coverage Ratio shall
be made as of each Calculation Date. The Consolidated Debt
Coverage Ratio in effect as of a Calculation Date shall
establish the Applicable Margins that shall be effective as
of the date designated by the Agent as the Applicable Margin
Change Date. The Agent shall determine the Applicable
Margins as of each Calculation Date and shall promptly
notify the Borrower and the Lenders of the Applicable
Margins so determined and of the Applicable Margin Change
Date. Such determinations by the Agent of the Applicable
Margins shall be conclusive absent manifest error.

2. Subsections (a) and (b) of Section 7.11 of the Credit
Agreement are amended in their entireties to read as
follows:

SECTION 7.11. Financial Covenants.
-------------------

(a) Consolidated Debt Coverage Ratio. The Borrower
--------------------------------
shall cause the Consolidated Debt Coverage Ratio to be no
greater than (i) at the Calculation Dates occurring on
June 30, 1996 and September 30, 1996, 3.75 to 1.00 and (ii)
at each Calculation Date thereafter, 3.25 to 1.00.

(b) Consolidated Interest Coverage Ratio. The
------------------------------------
Borrower shall cause the Consolidated Interest Coverage
Ratio to be no less than (i) at the Calculation Dates
occurring on June 30, 1996 and September 30, 1996, 2.25 to
1.00 and (ii) at each Calculation Date thereafter, 3.00 to
1.00

All references in the Credit Agreement and the other Credit
Documents to the "Credit Agreement" shall be deemed to refer to
the Credit Agreement as amended hereby.

Except as modified hereby, all of the terms and provisions of the
Credit Agreement and the other Credit Documents shall remain in
full force and effect.

This letter agreement shall be governed by and construed in
accordance with the laws of the State of North Carolina.

<PAGE> 3

Ralcorp Holdings, Inc.
June 26, 1996
Page 3

This letter agreement may be executed in one or more
counterparts, each of which constitute an original, and all of
which taken together shall constitute a single document.

Sincerely,

NATIONSBANK, N.A.,
as Agent

By /s/ Louise C. Comiskey
--------------------------------
Louise C. Comiskey
Vice President

ACCEPTED AND AGREED AS OF THE DATE FIRST ABOVE WRITTEN:

RALCORP HOLDINGS, INC.

By /s/
-----------------------------
Title:

cc: Those on the Attached Bank
Group Distribution List

<PAGE> 1

NationsBank Corporate Center
Charlotte, NC 28255
Tel 704 386-5000
Fax 704 386-3271

June 26, 1996

NationsBank

Ralcorp Holdings, Inc.
800 Market Street
29th Floor
St. Louis, Missouri 63101

RE: Credit Agreement dated as of March 12, 1996 among
Ralcorp Holdings, Inc., the Lenders party thereto and
NationsBank, N.A., as Agent in respect of $100,000,000
364-Day Revolving Credit Facility (the "Credit
Agreement")

Gentlemen:

Reference is made to the Credit Agreement described above, the
defined terms of which are incorporated herein by reference.

On behalf of the Required Lenders under the Credit Agreement, we
hereby agree with you to amend the Credit Agreement in the
following respects:

1. The definition of "Applicable Margin" set forth in
Section 1.01 of the Credit Agreement is amended in its
entirety to read as follows:

"Applicable Margin" shall mean, for purposes of
calculating the applicable interest rate for any day for any
Eurodollar Loan or the applicable rate of the Unused Fee for
any day for purposes of Section 2.04(a), the appropriate
applicable margin corresponding to the ratio described below
in effect as of the most recent Calculation Date:

<TABLE>
<CAPTION>
Applicable Applicable
Margin Margin
Pricing Consolidated Debt for for
Level Coverage Ratio Eurodollar Loans Unused Fee
- - - ------- ----------------- ---------------- ----------

<C> <S> <C> <C>
V Greater than 3.25 to 1.0 87.5 bps 22.5 bps

IV Equal to or less than 3.25 to 1.0 but greater than 2.75 to 1.0 60.0 bps 17.5 bps

III Equal to or less than 2.75 to 1.0 but greater than 2.25 to 1.0 45.0 bps 12.5 bps

II Equal to or less than 2.25 to 1.0 but greater than 1.75 to 1.0 40.0 bps 10.0 bps

I Equal to or less than 1.75 to 1.0 35.0 bps 7.5 bps
</TABLE>

USA
Official Sponsor
1994/1996 Member FDIC

<PAGE> 2

Ralcorp Holdings, Inc.
June 26, 1996
Page 2

The Applicable Margin as of the Closing Date is (i) 45 bps
for Eurodollar Loans and (ii) 12.5 bps for the Unused Fee.
Thereafter, determination of the appropriate Applicable
Margins based on the Consolidated Debt Coverage Ratio shall
be made as of each Calculation Date. The Consolidated Debt
Coverage Ratio in effect as of a Calculation Date shall
establish the Applicable Margins that shall be effective as
of the date designated by the Agent as the Applicable Margin
Change Date. The Agent shall determine the Applicable
Margins as of each Calculation Date and shall promptly
notify the Borrower and the Lenders of the Applicable
Margins so determined and of the Applicable Margin Change
Date. Such determinations by the Agent of the Applicable
Margins shall be conclusive absent manifest error.

2. Subsections (a) and (b) of Section 7.11 of the Credit
Agreement are amended in their entireties to read as
follows:

SECTION 7.11. Financial Covenants.
-------------------

All references in the Credit Agreement and the other Credit
Documents to the "Credit Agreement" shall be deemed to refer to
the Credit Agreement as amended hereby.

Except as modified hereby, all of the terms and provisions of the
Credit Agreement and the other Credit Documents shall remain in
full force and effect.

This letter agreement shall be governed by and construed in
accordance with the laws of the State of North Carolina.

<PAGE> 3

Ralcorp Holdings, Inc.
June 26, 1996
Page 3

This letter agreement may be executed in one or more
counterparts, each of which constitute an original, and all of
which taken together shall constitute a single document.

Sincerely,

NATIONSBANK, N.A.,
as Agent

By /s/ Louise C. Comiskey
--------------------------------
Louise C. Comiskey
Vice President

ACCEPTED AND AGREED AS OF THE DATE FIRST ABOVE WRITTEN:

RALCORP HOLDINGS, INC.

By /s/
-----------------------------
Title:

cc: Those on the Attached Bank
Group Distribution List

<PAGE> 1
STOCK PURCHASE AGREEMENT

AMONG

VAIL RESORTS, INC.,

RALSTON FOODS, INC.

AND

RALSTON RESORTS, INC.

JULY 22, 1996

<PAGE> 2
<TABLE>
TABLE OF CONTENTS
-----------------

<CAPTION>
PAGE
----
<S> <C>
ARTICLE I - DEFINITIONS. . . . . . . . . . . . . . . . . . . 1

ARTICLE II - SALE AND PURCHASE OF RALSTON STOCK;
CERTAIN PRE-CLOSING AND POST-CLOSING
MATTERS

2.1 Sale and Purchase of Ralston Stock. . . . . . 11
2.2 Purchase Price. . . . . . . . . . . . . . . . 11
2.3 Post-Closing Adjustments. . . . . . . . . . . 11
2.4 Vail Dividend . . . . . . . . . . . . . . . . 13

ARTICLE III - FOODS' REPRESENTATIONS AND WARRANTIES

3.1 Ralston Stock . . . . . . . . . . . . . . . . 13
3.2 Rights To Acquire Ralston Stock . . . . . . . 13
3.3 Transfer of the Ralston Stock . . . . . . . . 13
3.4 Corporate Standing of Foods . . . . . . . . . 14
3.5 Authority of Foods. . . . . . . . . . . . . . 14
3.6 Corporate Standing. . . . . . . . . . . . . . 15
3.7 Authority of Ralston. . . . . . . . . . . . . 15
3.8 Qualifications To Do Business . . . . . . . . 16
3.9 Capital Stock of Subsidiaries . . . . . . . . 16
3.10 Corporate and Stock Transfer Records. . . . . 16
3.11 Employee Loans and Other Employee Interests
in Ralston. . . . . . . . . . . . . . . . . 17
3.12 Ralston Financial Statements; No Material
Adverse Change. . . . . . . . . . . . . . . 17
3.13 Conduct of Business . . . . . . . . . . . . . 17
3.14 Dividends . . . . . . . . . . . . . . . . . . 19
3.15 Absence of Undisclosed Liabilities. . . . . . 19
3.16 Title to Property . . . . . . . . . . . . . . 20
3.17 Real Property . . . . . . . . . . . . . . . . 20
3.18 Personal Property . . . . . . . . . . . . . . 23
3.19 Litigation and Claims . . . . . . . . . . . . 24
3.20 Compliance with Laws. . . . . . . . . . . . . 24
3.21 Orders and Consent Decrees. . . . . . . . . . 24
3.22 Labor Agreements. . . . . . . . . . . . . . . 24
3.23 Employees . . . . . . . . . . . . . . . . . . 25
3.24 Contracts . . . . . . . . . . . . . . . . . . 25
3.25 Validity of Material Contracts. . . . . . . . 26
3.26 Trademarks and Copyrights . . . . . . . . . . 27
3.27 Powers of Attorney. . . . . . . . . . . . . . 28
3.28 Taxes . . . . . . . . . . . . . . . . . . . . 28
3.29 Employee Benefit Plans. . . . . . . . . . . . 30

-i-
<PAGE> 3
<CAPTION>
PAGE
----
<S> <C>
3.30 Environmental Matters . . . . . . . . . . . . 32
3.31 Liability and Casualty Insurance. . . . . . . 33
3.32 Consents or Approvals . . . . . . . . . . . . 33
3.33 Transaction Fees. . . . . . . . . . . . . . . 34
3.34 Bank Accounts . . . . . . . . . . . . . . . . 34
3.35 Ownership of Ralston Stock; Ralston Assets. . 34
3.36 Vail Stock Acquired For Foods' Account. . . . 34
3.37 United States Forest Service. . . . . . . . . 35
3.38 Passenger Tramway . . . . . . . . . . . . . . 35
3.39 Clean Water Act . . . . . . . . . . . . . . . 36
3.40 Keystone/Intrawest L.L.C. . . . . . . . . . . 37
3.41 Water Rights. . . . . . . . . . . . . . . . . 40

ARTICLE IV - VAIL'S REPRESENTATIONS AND WARRANTIES

4.1 Capital Stock . . . . . . . . . . . . . . . . 41
4.2 Transfer of the Vail Stock. . . . . . . . . . 41
4.3 Authority of Vail . . . . . . . . . . . . . . 41
4.4 Corporate Standing. . . . . . . . . . . . . . 42
4.5 Qualifications To Do Business . . . . . . . . 42
4.6 Capital Stock of Subsidiaries . . . . . . . . 43
4.7 Corporate Records . . . . . . . . . . . . . . 43
4.8 Employee Loans and Other Employee Interests
in Vail . . . . . . . . . . . . . . . . . . 43
4.9 Vail Financial Statements; No Material
Adverse Change. . . . . . . . . . . . . . . 44
4.10 Conduct of Business . . . . . . . . . . . . . 44
4.11 Dividends . . . . . . . . . . . . . . . . . . 46
4.12 Absence of Undisclosed Liabilities. . . . . . 46
4.13 Title to Property . . . . . . . . . . . . . . 46
4.14 Real Property . . . . . . . . . . . . . . . . 46
4.15 Personal Property . . . . . . . . . . . . . . 49
4.16 Litigation and Claims . . . . . . . . . . . . 50
4.17 Compliance with Laws. . . . . . . . . . . . . 50
4.18 Orders and Consent Decrees. . . . . . . . . . 50
4.19 Labor Agreements. . . . . . . . . . . . . . . 50
4.20 Employees . . . . . . . . . . . . . . . . . . 50
4.21 Contracts . . . . . . . . . . . . . . . . . . 51
4.22 Validity of Material Contracts. . . . . . . . 52
4.23 Trademarks and Copyrights . . . . . . . . . . 52
4.24 Powers of Attorney. . . . . . . . . . . . . . 53
4.25 Taxes . . . . . . . . . . . . . . . . . . . . 53
4.26 Employee Benefit Plans. . . . . . . . . . . . 56
4.27 Environmental Matters . . . . . . . . . . . . 58
4.28 Liability and Casualty Insurance. . . . . . . 58
4.29 Consents or Approvals . . . . . . . . . . . . 59

-ii-
<PAGE> 4
<CAPTION>
PAGE
----
<S> <C>
4.30 Transaction Fees. . . . . . . . . . . . . . . 59
4.31 Ralston Stock Acquired for Vail's Account . . 59
4.32 United States Forest Service. . . . . . . . . 59
4.33 Passenger Tramway . . . . . . . . . . . . . . 60
4.34 Clean Water Act . . . . . . . . . . . . . . . 61
4.35 Water Rights. . . . . . . . . . . . . . . . . 61
4.36 Financing Commitment. . . . . . . . . . . . . 61

ARTICLE V - COVENANTS PENDING CLOSING

5.1 Ralston Operations. . . . . . . . . . . . . . 61
5.2 Vail Operations . . . . . . . . . . . . . . . 66
5.3 Due Diligence Review. . . . . . . . . . . . . 67
5.4 Insurance . . . . . . . . . . . . . . . . . . 68
5.5 Public Announcements. . . . . . . . . . . . . 68
5.6 Hart-Scott-Rodino Filing; Investigations
or Litigation . . . . . . . . . . . . . . . 68
5.7 No Solicitation . . . . . . . . . . . . . . . 69
5.8 Audit of Ralston Financial Statements;
Delivery of Additional Financial
Statements. . . . . . . . . . . . . . . . . 69
5.9 Supplemental Disclosure . . . . . . . . . . . 70
5.10 Real Property Transfer Laws . . . . . . . . . 71
5.11 Cooperation . . . . . . . . . . . . . . . . . 71
5.12 Foods Receivables and Payables. . . . . . . . 71
5.13 Environmental Surveys . . . . . . . . . . . . 71
5.14 Affiliate Guarantors. . . . . . . . . . . . . 71
5.15 Notice of Certain Transactions. . . . . . . . 71
5.16 Guarantee Fees. . . . . . . . . . . . . . . . 72

ARTICLE VI - CONDITIONS TO CLOSING

6.1 Conditions of Vail. . . . . . . . . . . . . . 72
6.2 Conditions of Foods . . . . . . . . . . . . . 74
6.3 Hart-Scott-Rodino . . . . . . . . . . . . . . 74
6.4 No Litigation . . . . . . . . . . . . . . . . 74
6.5 Material Change in Market Circumstances . . . 75

ARTICLE VII - THE CLOSING

7.1 Place of Closing. . . . . . . . . . . . . . . 75
7.2 Date of Closing . . . . . . . . . . . . . . . 75
7.3 Effective Time of Closing . . . . . . . . . . 75
7.4 Delivery of Closing Documents . . . . . . . . 75

-iii-
<PAGE> 5
<CAPTION>
PAGE
----
<S> <C>
ARTICLE VIII - CLOSING TRANSACTIONS

8.1 Transfer of Ralston Stock . . . . . . . . . . 76
8.2 Delivery of Vail Stock. . . . . . . . . . . . 76
8.3 Receipt . . . . . . . . . . . . . . . . . . . 76
8.4 Opinion of Counsel of Foods . . . . . . . . . 76
8.5 Opinion of Counsel of Vail. . . . . . . . . . 78
8.6 Good Standing Certificates. . . . . . . . . . 80
8.7 Corporate Resolutions of Foods. . . . . . . . 80
8.8 Corporate Resolutions of Vail . . . . . . . . 80
8.9 Certificate of Foods. . . . . . . . . . . . . 80
8.10 Certificate of Vail . . . . . . . . . . . . . 81
8.11 Shareholder Agreement . . . . . . . . . . . . 81
8.12 Resignation of Ralston Corporate Officers . . 81
8.13 Consents. . . . . . . . . . . . . . . . . . . 81
8.14 Ancillary Documents . . . . . . . . . . . . . 81

ARTICLE IX - ADDITIONAL COVENANTS

9.1 Commissions and Fees. . . . . . . . . . . . . 81
9.2 Costs and Expenses. . . . . . . . . . . . . . 82
9.3 Bank Accounts . . . . . . . . . . . . . . . . 82
9.4 Business Relationships. . . . . . . . . . . . 83
9.5 Insurance Proceeds. . . . . . . . . . . . . . 83
9.6 Further Action. . . . . . . . . . . . . . . . 83
9.7 Records . . . . . . . . . . . . . . . . . . . 84
9.8 Employee Benefit Plan Matters . . . . . . . . 84
9.9 Confidentiality Agreement . . . . . . . . . . 86
9.10 Tax Election. . . . . . . . . . . . . . . . . 87
9.11 Resale of Ralston Stock . . . . . . . . . . . 87
9.12 Non-Competition . . . . . . . . . . . . . . . 87

ARTICLE X - INDEMNIFICATION

10.1 Indemnification of Vail . . . . . . . . . . . 88
10.2 Indemnification of Foods. . . . . . . . . . . 88
10.3 Indemnification Procedure . . . . . . . . . . 89
10.4 Third Party Claims. . . . . . . . . . . . . . 89
10.5 Tax Indemnification . . . . . . . . . . . . . 90
10.6 Limitation of Indemnification . . . . . . . . 91
10.7 Procedures Relating to Indemnification of
Tax Claims. . . . . . . . . . . . . . . . . 91
10.8 Survival of Representations and
Warranties. . . . . . . . . . . . . . . . . 93
10.9 Survival of Indemnities . . . . . . . . . . . 93
10.10 Transfer Taxes. . . . . . . . . . . . . . . . 93

-iv-
<PAGE> 6
<CAPTION>
PAGE
----
<S> <C>
10.11 Return Filings, Refunds and Credits . . . . . 94
10.12 Refunds from Carrybacks . . . . . . . . . . . 95
10.13 Termination of Tax Sharing Agreements . . . . 95
10.14 Payments. . . . . . . . . . . . . . . . . . . 95

ARTICLE XI - TERMINATION

11.1 Mutual Consent. . . . . . . . . . . . . . . . 96
11.2 Obligation To Close . . . . . . . . . . . . . 96
11.3 Final Closing Date. . . . . . . . . . . . . . 96
11.4 Obligations After Termination . . . . . . . . 96

ARTICLE XII - MISCELLANEOUS PROVISIONS

12.1 Entire Agreement. . . . . . . . . . . . . . . 96
12.2 Effect of Supplemental Information. . . . . . 96
12.3 Choice of Law . . . . . . . . . . . . . . . . 97
12.4 Venue . . . . . . . . . . . . . . . . . . . . 97
12.5 Notices . . . . . . . . . . . . . . . . . . . 97
12.6 Effective Date of Notice. . . . . . . . . . . 98
12.7 Amendments. . . . . . . . . . . . . . . . . . 99
12.8 Gender and Number . . . . . . . . . . . . . . 99
12.9 Assignments . . . . . . . . . . . . . . . . . 99
12.10 Headings and Captions . . . . . . . . . . . . 99
12.11 Schedules and Exhibits. . . . . . . . . . . . 99
12.12 Severability. . . . . . . . . . . . . . . . . 99
12.13 Counterparts. . . . . . . . . . . . . . . . . 99
12.14 Remedies. . . . . . . . . . . . . . . . . . . 100
12.15 Third-Party Beneficiaries . . . . . . . . . . 100
12.16 Binding Agreement . . . . . . . . . . . . . . 100

Exhibit A - Shareholder Agreement
</TABLE>

-v-
<PAGE> 7

STOCK PURCHASE AGREEMENT
------------------------

THIS STOCK PURCHASE AGREEMENT (this "Agreement") is made
and entered into this 22nd day of July, 1996, by and among Vail
Resorts, Inc., a Delaware corporation ("Vail"), Ralston Foods,
Inc., a Nevada corporation ("Foods"), and Ralston Resorts, Inc., a
Colorado corporation ("Ralston").

WHEREAS, Foods is the owner of all the issued and
outstanding capital stock of Ralston; and

WHEREAS, Foods desires to sell all of the capital stock
of Ralston to Vail in accordance with the terms and subject to the
conditions of this Agreement; and

WHEREAS, Vail desires to purchase all of the capital
stock of Ralston in accordance with the terms and subject to the
conditions of this Agreement.

NOW, THEREFORE, in consideration of the mutual promises
and covenants contained herein, and subject to the terms and
conditions of this Agreement, Foods and Vail agree as follows:

ARTICLE I

DEFINITIONS

"Active Ralston Employee" shall have the meaning
-----------------------
given it in Section 9.8(a).

"Adjusted Balance Sheet" shall mean the Ralston
----------------------
balance sheet as of June 30, 1996, adjusted to remove the
Excluded Assets, as set forth on Schedule 1.1.

"Affiliate" shall have the meaning given in the
---------
Shareholder Agreement.

"Affiliated Group" shall have the meaning given to
----------------
it in Section 3.28(a).

"ANSI" shall have the meaning given it in Section 3.38(b).
----

<PAGE> 8

-2-

"Business Day" shall mean any day other than a
------------
Saturday, Sunday or legal holiday for commercial banks in New
York City or St. Louis, Missouri.

"Clean Water Act" shall have the meaning given it
---------------
in Section 3.39(a).

"Closing" shall mean the consummation of the
-------
transactions contemplated by this Agreement.

"Closing Contribution Adjustment" shall mean the
-------------------------------
lesser of (A) (i) the Contribution Adjustment of Ralston for the
period from August 1, 1996 through the Closing Date, less
(ii) the amount, if any, by which $6,676,000 exceeds the
Contribution Adjustment of Ralston for the period from July 1,
1996 through July 31, 1996; and (B) the greater of
(x) $18,000,000 and (y) the amount set forth in the certificate
of an officer of Foods delivered pursuant to Section 6.1(k).

"Closing Date" shall mean the fifth Business Day
------------
after the date on which the last to be received of all
authorizations, approvals, consents, permits and licenses from
governmental and regulatory bodies and third parties set forth in
this Agreement that are conditions to the consummation of the
transactions contemplated hereby have been obtained.

"Closing Date Statements" shall have the meaning
-----------------------
given it in Section 2.3(a).

"Code" shall mean the Internal Revenue Code of
----
1986, as amended, and all regulations promulgated thereunder.

"Confidentiality Agreement" shall mean,
-------------------------
collectively, (i) the Confidentiality Agreement dated March 19,
1996 between Ralcorp Holdings, Inc. and Apollo Advisors, L.P. and
(ii) the Confidentiality and Exclusivity Agreement dated May 16,
1996, as supplemented by a letter agreement dated July 10, 1996,
between Ralcorp Holdings, Inc. and Apollo Advisors, L.P.

"Contribution Adjustment" shall mean for any period
-----------------------
(i) the Net Investment during such period, less (ii) EBITDA for
such period, plus (iii) Net Assets on the last day of such
period, less (iv) Net Assets on the first day of such period.

"Contribution Agreement" shall mean the
----------------------
Contribution Agreement between Ralston and Intrawest, dated
February 7, 1994.

<PAGE> 9

-3-

"Corporate Officers" of Ralston are Ingrid Keiser,
------------------
Howard Maves, Joe R. Micheletto, John Rutter and Brian Smith; and
of Vail are Andrew P. Daly, Gerald E. Flynn, James S. Mandel, J.
Kent Myers and Christopher P. Ryman.

"CPTSB" shall have the meaning given it in Section
-----
3.38(a).

"EBITDA" shall mean for any period (i) earnings
------
before interest and taxes, plus (ii) depreciation and
amortization expense, plus (iii) other non-cash charges
(including, but not limited to, losses on sale of assets, write
down of assets or extraordinary charges), plus (iv) losses
related to the LLC or other investments, less (v) income related
to the LLC or other investments. All terms shall be calculated
for Ralston and its subsidiaries on a consolidated basis
according to GAAP.

"Employee Benefit Plans" shall mean all employee
----------------------
benefit plans as such term is defined in Section 3(3) of ERISA,
but excluding all pension and welfare plans which are
Multiemployer Plans or are otherwise maintained pursuant to a
collective bargaining agreement and to which more than one
employer contributes and any other deferred compensation, stock
option, restricted stock or unit, performance share or unit,
bonus, vacation, severance, sick leave or other welfare or
incentive plan.

"Environmental Claims" shall mean any and all
--------------------
administrative, regulatory or judicial actions, suits, demands,
liens, notices of noncompliance or violation, investigations or
proceedings relating to any Environmental Law or Environmental
Permit including, without limitation, (a) any demands or claims
by governmental or regulatory authorities for enforcement,
cleanup, removal, response or remedial action, (b) any demands or
claims for damages pursuant to any applicable Environmental Law,
and (c) any demands or claims by any third party seeking damages,
contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from any Hazardous Substance.

"Environmental Law" shall mean the following
-----------------
federal laws (including related regulations) and all Colorado
state or local equivalents thereof: The Comprehensive
Environmental Response, Compensation and Liability Act of 1980,
as amended by the Superfund Amendments and Reauthorization Act of
1986; the Emergency Planning and Community Right-to-Know Act; the
Resource Conservation and Recovery Act; the Federal Water

<PAGE> 10

-4-

Pollution Control Act; the Clean Air Act; the Clean Water Act;
the Safe Drinking Water Act; the Toxic Substances Control Act;
the Oil Pollution Act of 1990; and the Hazardous Materials
Transportation Act.

"Environmental Permit" shall mean a permit,
--------------------
identification number, license or other written authorization
required under any applicable Environmental Law.

"ERISA" shall mean the Employee Retirement Income
-----
Security Act of 1974, as amended, and all regulations promulgated
thereunder.

"ERISA Affiliate" shall mean with respect to a
---------------
party, (a) any entity that is (or at any relevant time was) a
member of a "controlled group of corporations" with or under
"common control" with such party (as such terms are defined in
Section 414(b) and (c) of the Code), or (b) any entity that is
(or at any relevant time was) a member of an "affiliated service
group" (as such term is defined in Section 414(m) of the Code)
that includes such party.

"Excluded Assets" means those assets set forth on
---------------
Schedule 1.1 as the "Excluded Assets."

"Foods Affiliates" shall have the meaning given it
----------------
in Section 9.12.

"GAAP" shall mean accounting principles which are
----
(a) consistent with the principles promulgated or adopted by the
Financial Accounting Standards Board and its predecessors, in
effect from time to time, and (b) applied on a basis consistent
with prior periods.

"Hart-Scott-Rodino" shall mean the
-----------------
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended,
and all regulations promulgated thereunder.

"Hazardous Substances" shall mean: (a) any
--------------------
chemical, material or substance defined as, or included in the
definition of, "hazardous substances," "hazardous wastes,"
"hazardous materials," "toxic substances or toxic pollutants,"
"contaminants," "toxic or hazardous chemicals" or "pesticides" in
any applicable Environmental Law, or (b) any petroleum or
petroleum product or asbestos-containing materials in a condition
that would pose an imminent danger to public health.

<PAGE> 11

-5-

"Income Tax" or "Income Taxes" shall mean any
---------- ------------
tax or taxes imposed or based on income, including, but not
limited to, any income, environmental, minimum or franchise tax
based on income, alternative net worth tax or single business
tax, imposed by any foreign, federal, state, county or local
government, or any subdivision or agency thereof, and any
interest, penalty or expense relating to such taxes.

"Indebtedness" shall mean (i) any liability,
------------
contingent or otherwise, of Ralston or any of its subsidiaries
(A) for borrowed money (whether or not the recourse of the lender
is to the whole of the assets of Ralston or any of its
subsidiaries or only to a portion thereof) or (B) evidenced by a
note, debenture or similar instrument or letter of credit
(including a purchase money obligation or other obligation
relating to the deferred purchase price of property and trade
payables that are more than 30 days past due); (ii) any liability
of others of the kind described in the preceding clause (i) which
Ralston or any of its subsidiaries has guaranteed or which is
otherwise its legal liability; (iii) any obligation secured by a
lien to which the property or assets of Ralston or any of its
subsidiaries are subject, whether or not the obligations secured
thereby shall have been assumed by it or shall otherwise be its
legal liability; (iv) all capitalized lease obligations of
Ralston or any of its subsidiaries; and (v) any liability of
Ralston or any of its subsidiaries for debt owing to the National
Bank of Australia relating to the Conference Center. For
purposes of this definition of Indebtedness, Indebtedness of the
LLC shall not be considered Indebtedness of Ralston or any of its
subsidiaries unless Ralston or any of its subsidiaries has
guaranteed or otherwise become liable with respect to such
Indebtedness (other than by virtue of the pledge of the Option
Land).

"Intrawest" shall mean Intrawest Resorts, Inc., a
---------
Delaware Corporation.

"IRS" shall mean the Internal Revenue Service.
---

"Knowledge" or "best knowledge" shall mean,
--------- --------------
when used in connection with the representations and warranties
and covenants herein, the knowledge, after reasonable inquiry of
the relevant facts and circumstances, of the applicable party's
Corporate Officers and not any other employees of the party
making the representation or warranty or covenant.

<PAGE> 12

-6-

"LLC" shall mean the Keystone/Intrawest Limited
---
Liability Company formed pursuant to the LLC Agreement.

"LLC Agreement" shall mean the Limited Liability
-------------
Company Agreement between Ralston and Intrawest, dated
February 7, 1994.

"Loss" shall mean any liability, loss, damage,
----
assessment, obligation, settlement payment, award, fine, penalty,
judgment, cost or expense, including reasonable attorneys' fees,
auditors' fees and experts' fees (but excluding punitive damages
that may be imposed on or against the indemnified party because
of its egregious conduct after the Closing), suffered by a party
hereto, including expenses related to investigating, defending
and settling indemnifiable claims, but net of any insurance
proceeds received by the injured party with respect to a Loss.

"Management Agreement" shall mean the Real Estate
--------------------
Development Management Services Agreement between Intrawest and
the LLC, dated February 7, 1994.

"Material Adverse Change" shall mean, with respect
-----------------------
to a party, any event, occurrence or change or effect that is
materially adverse to the business, operations, results of
operations or condition (financial or otherwise) or prospects of
such party and its subsidiaries, taken as a whole.

"Multiemployer Plan" shall mean, with respect to a
------------------
party, any "multiemployer plan" as defined in Section 3(37) of
ERISA that such party or any ERISA Affiliate of such party
contributes to or is required to contribute to, or under which
such party or any ERISA Affiliate of such party may incur any
liability.

"Net Assets" shall mean (i) current assets
----------
(excluding cash and cash equivalents and any Excluded Assets),
less (ii) total liabilities (excluding any liabilities which
would be included in the definition of Total Ralston Indebtedness
or liabilities to Foods or any of its Affiliates). All terms
shall be calculated for Ralston and its subsidiaries on a
consolidated basis according to GAAP.

"Net Investment" shall mean for any period
--------------
(i) additions to property, plant and equipment, plus (ii) cash
investments in or loans to the LLC, plus (iii) acquisitions for
cash of real estate held for sale, less (iv) the proceeds from

<PAGE> 13

-7-

the sale or disposal of any non-current assets (including real
estate held for sale and property, plant and equipment), less
(v) cash received from the LLC or any other investment. All
terms shall be calculated for Ralston and its subsidiaries on a
consolidated basis according to GAAP.

"Notice of Claim" shall mean a written notice
---------------
delivered by a party claiming a right of indemnification to a
party that would be required to indemnify an injured party or
hold such injured party harmless in accordance with the terms of
this Agreement.

"Option Land" shall mean the "option land" as
-----------
defined in the LLC Agreement.

"Permitted Debt Level" shall mean $165,000,000.
--------------------

"Permitted Encumbrances" shall mean, collectively:
----------------------
(a) liens for Taxes, fees, levies, duties or other governmental
charges of any kind which are not yet delinquent or are being
contested in good faith by appropriate proceedings; or (b) liens
that arise by operation of law for work performed or materials
supplied to any of the real properties owned by Ralston or any of
its subsidiaries after the date hereof; or (c) easements,
rights-of-way, restrictions and covenants, none of which (a)
through (c) above, individually or in the aggregate, would be
material as to the particular site or asset in question as it
relates to its current or presently intended use.

"Pre-Closing Tax Period" shall have the meaning
----------------------
given it in Section 10.5(a).

"Ralcorp" means Ralcorp Holdings, Inc., a Delaware
-------
corporation.

"Ralston Budget" means the 1996-1997 Ralston Budget
--------------
(which includes details as to estimated operating cash flow and
capital expenditures for the period commencing with July 1, 1996
and ending with December 31, 1996 on a month-to-month basis) as
set forth on Schedule 1.1(a) hereto.

"Ralston Employee" shall mean an individual who
----------------
(a) is employed by Ralston or any of its subsidiaries on the date
of the Closing, or (b) was employed by Ralston or any of its
subsidiaries immediately prior to his or her retirement or other
termination of employment prior to the date of the

<PAGE> 14

-8-

Closing, or (c) is, as of the Closing, on any approved leave of
absence from employment with Ralston or any of its subsidiaries,
including, but not limited to, leave due to disability.

"Ralston Employee Benefit Plans" has the meaning
------------------------------
given it in Section 3.29(a).

"Ralston Financial Statements" shall mean (i) the
----------------------------
unaudited consolidated balance sheets of Ralston as of
September 30, 1994 and September 30, 1995, the consolidated
statements of earnings and cash flow for the years ended
September 30, 1993, 1994 and 1995, the unaudited consolidated
balance sheet of Ralston as of June 30, 1996 and the consolidated
statement of earnings and cash flow for the nine months ended
June 30, 1996, and (ii) any other financial statements of Ralston
delivered to Vail pursuant to Section 5.8(b).

"Ralston Leased Property" shall have the meaning
-----------------------
given it in Section 3.17(a).

"Ralston Participant" shall mean any Ralston
-------------------
Employee, or a dependent, beneficiary or alternate payee of a
Ralston Employee, who, on the date of Closing, was participating
in, or was otherwise entitled to benefits from, an Employee
Benefit Plan maintained for Ralston Employees by Ralston or Foods
or Ralcorp or one of their Affiliates.

"Ralston Stock" shall mean all of the outstanding
-------------
common stock of Ralston, par value $10.00 per share.

"Retirement Plan" shall have the meaning given it
---------------
in Section 9.8(b).

"Savings Plan" shall have the meaning given it in
------------
Section 9.8(b).

"SEC" shall mean the Securities and Exchange
---
Commission.

"Securities Act of 1933" shall mean the Securities
----------------------
Act of 1933, as amended, and all regulations promulgated
thereunder.

"Shareholder Agreement" means the Shareholder
---------------------
Agreement, substantially in the form of Exhibit A hereto, among
Foods, Vail and Apollo Ski Partners, L.P.

<PAGE> 15

-9-

"Straddle Period" shall have the meaning given it
---------------
in Section 10.5(c).

"Tax" or "Taxes" shall mean all taxes, charges,
--- -----
fees, levies or other assessments including without limitation
all federal, state, local or foreign net income, gross income,
gross receipts, license, payroll, employment, excise, severance,
stamp, documentary, occupation, windfall profits, environmental
(including Taxes under Section 59A of the Code), customs duties,
capital stock, franchise, profits, withholding, social security
(or similar), unemployment, disability, real property, personal
property, sales, use, transfer, registration, value added,
estimated alternative or add-on minimum or other tax, fee,
assessment or charge of any kind whatsoever and shall include all
interest or penalties on Taxes, additions to tax or additional
amounts imposed by any taxing authority (domestic or foreign),
whether or not disputed.

"Tax Claim" shall have the meaning given it in
---------
Section 10.7(a).

"Tax Indemnified Party" shall have the meaning
---------------------
given it in Section 10.7(a).

"Tax Indemnifying Party" shall have the meaning
----------------------
given it in Section 10.7(a).

"Tax Notice" shall have the meaning given it in
----------
Section 10.7(a).

"Tax Return" shall mean a return, declaration,
----------
report, claim for refund or information return relating to Taxes
including, without limitation, any statement, information or
documentation required to be provided to any taxing authority
with respect to Taxes, including any schedule or attachment
thereto, and including any amendment thereof.

"Tax Sharing Agreements" shall have the meaning
----------------------
given it in Section 10.13.

"Total Ralston Indebtedness" shall mean, as of any
--------------------------
date, the sum of the aggregate principal amount of and accrued
interest on Indebtedness of Ralston and its subsidiaries as of
such date.

"Uncleared Ralston Checks" shall have the meaning
------------------------
given it in Section 9.3(b).

<PAGE> 16

-10-

"USFS" and "USFS Permits" shall have the
---- ------------
meanings given in Section 3.37(a).

"Vail Dividend" shall mean the distribution to the
-------------
then existing shareholders of Vail made prior to the Closing of
the right to receive up to $55 million in cash at one or more
times prior to or subsequent to the Closing Date.

"Vail Employee" shall mean an individual who (a) is
-------------
employed by Vail or any of its subsidiaries on the date of the
Closing, or (b) was employed by Vail or any of its subsidiaries
immediately prior to his or her retirement or other termination
of employment prior to the date of the Closing, or (c) is, as of
the Closing, on any approved leave of absence from employment
with Vail or any of its subsidiaries, including, but not limited
to, leave due to disability.

"Vail Employee Benefit Plans" shall have the
---------------------------
meaning given it in Section 4.26(a).

"Vail Financial Statements" shall mean (i) the
-------------------------
consolidated balance sheet of Vail as of September 30, 1995 and
September 30, 1994, and the related statements of earnings and
cash flow for the year ended September 30, 1995 and September 30,
1994 and the period from October 9, 1992 through September 30,
1993, as audited by Arthur Andersen LLP, (ii) the consolidated
balance sheet of Vail as of April 30, 1996 and the related
statement of earnings and cash flow for the seven months ended
April 30, 1996 and (iii) any other financial statements of Vail
delivered to Foods pursuant to Section 5.8(d).

"Vail Leased Property" shall have the meaning given
--------------------
it in Section 4.14(a).

"Vail Stock" shall mean the Common Stock, $.01 par
----------
value, of Vail.

"Ventures" shall have the meaning given it in
--------
Section 3.9.

<PAGE> 17

-11-

ARTICLE II

SALE AND PURCHASE OF RALSTON STOCK;
CERTAIN PRE-CLOSING AND POST-CLOSING MATTERS

2.1 Sale and Purchase of Ralston Stock. Upon the
----------------------------------
terms and subject to the conditions contained in this Agreement,
in reliance upon the representations, warranties and agreements
contained in this Agreement and in consideration of the payment
of the purchase price as provided in Section 2.2 below, on the
date of the Closing, Foods shall sell, transfer, convey, assign
and deliver to Vail, or its nominee, all of the issued and
outstanding shares of Ralston Stock.

2.2 Purchase Price. Upon the terms and subject to
--------------
the conditions contained in this Agreement, in reliance upon the
representations, warranties and agreements contained in this
Agreement and in consideration of the aforesaid sale, transfer,
conveyance, assignment and delivery of the outstanding shares of
Ralston Stock, on the date of the Closing, Vail will deliver to
Foods, or its nominee, 3,777,203 shares of Vail Stock.

2.3 Post-Closing Adjustments.
------------------------

(a) Within 30 days after the Closing Date, Ralston
shall deliver to Foods and Vail (i) an audited consolidated
balance sheet of Ralston as of the Closing Date, (ii) an audited
consolidated income statement and statement of cash flows of
Ralston for the period from July 1, 1996 to the Closing Date, and
(iii) a statement from Price Waterhouse, the independent auditors
of Ralston, setting forth the calculation of Total Ralston
Indebtedness and the Closing Contribution Adjustment
(collectively, the "Closing Date Statements").

(b) Vail and Foods shall have 30 days to review the
Closing Date Statements after receipt thereof. Unless Vail or
Foods deliver written notice to the other party on or prior to
the 30th day after receipt of the Closing Date Statements of
Vail's or Foods' objection to the Closing Date Statements and
specifying in reasonable detail all disputed items and the basis
therefor, Vail and Foods shall be deemed to have accepted and
agreed to the Closing Date Statements. If Vail or Foods so
notify Ralston of their objection to the Closing Date Statements,
Vail and Foods shall, within 30 days following such notice (the
"Resolution Period"), attempt to resolve their

<PAGE> 18

-12-

differences, and any resolution by them as to any disputed
amounts shall be final, binding and conclusive.

(c) If, at the conclusion of the Resolution Period,
any amounts remain in dispute, then all such amounts remaining in
dispute shall be submitted to Deloitte & Touche LLP (the "Neutral
Auditors"). Each of Vail, Foods and Ralston agrees to execute,
if requested by the Neutral Auditors, a reasonable engagement
letter. In the event that Vail, Foods and Ralston are unable to
engage the Neutral Auditors within five days after the conclusion
of the Resolution Period then they shall engage KPMG Peat Marwick
LLP to act as alternative neutral auditors (the "Alternative
Neutral Auditors"). All fees and expenses relating to the work,
if any, to be performed by the Neutral Auditors or the
Alternative Neutral Auditors, as the case may be, shall be borne
(i) 50% by Vail and (ii) 50% by Foods. The Neutral Auditors or
the Alternative Neutral Auditors, as the case may be, shall act
as an arbitrator to determine, based solely on presentations by
Vail and Foods, and not by independent review, only those issues
still in dispute. Vail and Foods shall use their reasonable best
efforts to cause the determination of the Neutral Auditors or the
Alternative Neutral Auditors, as the case may be, to be made
within 30 days of submission as provided above, whether or not
such presentation by Foods and Vail have been made within such
period and shall be set forth in a written statement delivered to
Foods and Vail and shall be final, binding and conclusive.

(d) To the extent that the amount of Total Ralston
Indebtedness exceeds or is less than the Permitted Debt Level on
the Closing Date, Foods will promptly pay to Vail, upon its
demand, an amount equal to such excess (or Vail will promptly pay
to Foods, upon its demand, an amount equal to such deficiency) in
immediately available funds.

(e) Prior to Closing, Ralston shall (i) incur third
party Indebtedness in an amount not exceeding the Permitted Debt
Level less the principal amount of third party Indebtedness of
Ralston outstanding at such time (the "Foods Dividend Amount")
and (ii) shall dividend the Foods Dividend Amount to Foods prior
to Closing (the "Foods Dividend"). On the Closing Date, Vail
shall repay in full the third party Indebtedness incurred by
Ralston to pay the Foods Dividend so that Foods and its
Affiliates are unconditionally released from any guarantee of
said Indebtedness. In addition, prior to Closing, Ralston shall
distribute to Foods the Excluded Assets.

<PAGE> 19

-13-

(f) Within 10 days after the Closing Date Statements
have been agreed to or have become final, Vail will deliver to
Foods, or its nominee, a number of shares of Vail Stock equal to
the excess, if any, of (a) the number obtained by dividing the
Closing Contribution Adjustment by the amount set forth on
Schedule 2.3(e) over (b) 96,120.

2.4 Vail Dividend. Prior to the Closing, Vail
-------------
shall declare the Vail Dividend to its then existing shareholders
(and Foods shall not be entitled to any participation therein).

ARTICLE III

FOODS' REPRESENTATIONS AND WARRANTIES

Foods represents and warrants that:

3.1 Ralston Stock. The Ralston Stock is the only
-------------
authorized class of capital stock of Ralston. There are 100
shares of Ralston Stock authorized and 100 shares outstanding.
All outstanding shares of Ralston Stock are duly authorized,
validly issued, fully paid and non-assessable. There are no
options, warrants, calls or agreements of any character for the
issuance of additional shares of Ralston Stock. There are no
contracts for the authorization or issuance of any other class of
securities of Ralston, and there are no outstanding securities
convertible or exchangeable into Ralston Stock.

3.2 Rights To Acquire Ralston Stock. Neither
-------------------------------
Foods nor Ralston or any of its subsidiaries is a party to any
agreement or understanding, oral or written, which (a) grants an
option or other right to acquire any of the Ralston Stock or any
other equitable interest in Ralston, (b) grants a right of first
refusal or other such similar right upon the sale of any of the
Ralston Stock, or (c) restricts or affects the voting rights of
any of the Ralston Stock.

3.3 Transfer of the Ralston Stock. The stock
-----------------------------
certificate(s) representing all of the outstanding shares of
Ralston Stock to be delivered to Vail, or its nominee, at the
Closing, and the signatures or endorsements thereon (or on stock
powers delivered therewith), when duly executed, shall be valid
and genuine, and shall transfer to and vest in Vail, or its
nominee, good, valid, marketable and indefeasible title to all of
the outstanding shares of the Ralston Stock, subject to

<PAGE> 20

-14-

no lien, security interest or other encumbrance on the Ralston
Stock. Upon the transfer of the Ralston Stock contemplated
hereby, Vail will own the entire equity interest in Ralston.

3.4 Corporate Standing of Foods. Foods is a
---------------------------
corporation duly organized, validly existing and in good standing
under the laws of the State of Missouri. The execution and
delivery of this Agreement, and such other agreements,
instruments and documents required to be executed by Foods in
connection herewith, do not, and the consummation of the
transactions contemplated herein and therein will not, conflict
with, or result in any violation of, breach of or default (with
or without notice or lapse of time) under, or give rise to a
right of termination, cancellation or acceleration of any
obligation or the loss of a benefit under, (a) any provision of
the Articles of Incorporation or bylaws of Foods, or (b) except
as set forth on Schedule 3.4, any loan or credit agreement, note,
bond, mortgage, indenture, lease, contract, judgment, order,
decree, writ or injunction to which Foods is a party, or by which
it or its properties or assets are bound, or result in the
creation or imposition of any lien upon any such properties or
assets.

3.5 Authority of Foods.
------------------

(a) Foods has taken all action required by its
Articles of Incorporation and its bylaws to authorize the
execution and delivery of this Agreement, and such other
agreements, instruments and documents required to be executed by
Foods in connection herewith, and the performance of the
transactions contemplated herein and therein. Foods has all
requisite corporate power and authority to authorize the
execution and delivery of this Agreement, and such other
agreements, instruments and documents required to be executed in
connection herewith, to consummate the transactions contemplated
herein and therein, and to take all other actions required to be
taken by Foods pursuant to the provisions hereof. This
Agreement, and such other agreements, instruments and documents
required to be executed in connection herewith, when duly
executed and delivered, shall constitute a valid and binding
obligation of Foods enforceable in accordance with its terms
except to the extent that enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or
other laws affecting the enforcement of creditors' rights
generally or by general equitable or fiduciary principles.

(b) No approvals on the part of any class (whether
voting together or as separate classes) of Foods' shareholders

<PAGE> 21

-15-

are necessary to authorize this Agreement or any other
agreements, instruments and documents required to be executed in
connection herewith, or the transactions contemplated herein or
therein.

3.6 Corporate Standing. Each of Ralston and its
------------------
subsidiaries is a corporation duly organized, validly existing
and in good standing under the laws of the jurisdiction of its
incorporation and has the corporate power and authority to own
its property and assets and to carry on its business in the same
manner as now being conducted. The execution and delivery of
this Agreement, and such other agreements, instruments and
documents required to be executed by Ralston in connection
herewith, do not, and the consummation of the transaction
contemplated herein and therein will not, conflict with, or
result in any violation of, breach of or default (with or without
notice or lapse of time or both) under, or give rise to a right
of termination, cancellation or acceleration of any obligation or
the loss of a benefit under, (a) any provision of the Articles of
Incorporation or bylaws of Ralston or any of its subsidiaries, or
(b) except as set forth on Schedule 3.6 hereto, any loan or
credit agreement, note, bond, mortgage, indenture, lease,
contract, agreement, instrument or permit, judgment, order,
decree, writ or injunction to which Ralston or any of its
subsidiaries is a party, or by which it or any of its
subsidiaries or its or any of its subsidiaries' properties or
assets are bound, or result in the creation or imposition of any
lien upon any of such properties or assets.

3.7 Authority of Ralston. Ralston has taken all
--------------------
action required by its Articles of Incorporation and its by-laws
to authorize the execution and delivery of this Agreement, and
such other agreements, instruments and documents required to be
executed by Ralston in connection herewith, and the performance
of the transactions contemplated herein and therein. Ralston has
all requisite corporate power and authority to authorize the
execution and delivery of this Agreement, and such other
agreements, instruments and documents required to be executed in
connection herewith, to consummate the transactions contemplated
herein and therein, and to take all other actions required to be
taken by Ralston pursuant to the provisions hereof. This
Agreement, and such other agreements, instruments and documents
required to be executed in connection herewith, when duly
executed and delivered, shall constitute a valid and binding
obligation of Ralston enforceable in accordance with its terms
except to the extent that enforceability may be limited by
applicable bankruptcy, insolvency, reorganization,

<PAGE> 22

-16-

moratorium or other laws affecting the enforcement of creditors'
rights generally or by general equitable or fiduciary principles.

3.8 Qualifications To Do Business. Each of
-----------------------------
Ralston and its subsidiaries is duly qualified and in good
standing as a foreign corporation and authorized to do business
in each jurisdiction set forth on Schedule 3.8 hereto. Each of
Ralston and its subsidiaries is qualified and in good standing in
every other jurisdiction in which the ownership of its property
or the conduct of its business requires it to be qualified to do
business, except in those jurisdictions where the failure to be
so qualified would not, individually or in the aggregate, result
in a Material Adverse Change on Ralston.

3.9 Capital Stock of Subsidiaries. The only
-----------------------------
direct or indirect subsidiaries of Ralston are those listed on
Schedule 3.9. hereto. Except as set forth on Schedule 3.9
hereto, Ralston is directly or indirectly the record and
beneficial owner of all of the outstanding shares of capital
stock of each of its subsidiaries, there are no proxies with
respect to such shares, and no equity securities of any of such
subsidiaries are or may be required to be issued by reason of any
options, warrants, scrip, rights to subscribe for, calls or
commitments of any character whatsoever relating to, or
securities or rights convertible into or exchangeable for, shares
of any capital stock of any such subsidiary, and there are no
contracts, commitments, understandings or arrangements by which
any such subsidiary is bound to issue additional shares of its
capital stock or securities convertible into or exchangeable for
such shares. Other than as set forth on Schedule 3.9 hereto, all
of such shares so owned by Ralston are validly issued, fully paid
and nonassessable and are owned by it free and clear of any
claim, lien or encumbrance of any kind with respect thereto.
Except as disclosed on Schedule 3.9 hereto, Ralston does not
directly or indirectly own any interest in any corporation,
partnership, joint venture or other business association or
entity. For purposes of this Section 3.9, the LLC, Clinton Ditch
& Reservoir Company, Ski the Summit and Starfire Ventures
(collectively, the "Ventures") shall each be considered a
subsidiary of Ralston.

3.10 Corporate and Stock Transfer Records. True
------------------------------------
and correct copies of the Articles of Incorporation and bylaws of
Ralston have previously been delivered to Vail. All minutes of
Ralston contained in the minute books of Ralston accurately
reflect the substance of all actions taken by shareholders of

<PAGE> 23

-17-

Ralston and Ralston's Board of Directors. The Ralston Stock
transfer register is true, complete, correct and current.

3.11 Employee Loans and Other Employee Interests in
----------------------------------------------
Ralston. Except as set forth on Schedule 3.11, there are no
- - - -------
outstanding loans by or to Ralston or any of its subsidiaries to
or from any Ralston Employee, other than (a) emergency loans
which do not exceed $10,000 in the aggregate, and none of which
exceed $1,000 individually, (b) housing loans which do not exceed
$10,000 in the aggregate, and none of which exceed $1,000
individually, (c) ordinary travel advances or (d) employee
charges not exceeding $5,000 individually, and $50,000 in the
aggregate. Except as set forth on Schedule 3.11, no Ralston
Employee currently employed has any material interest, direct or
indirect, in any lease or contract of Ralston.

3.12 Ralston Financial Statements; No Material
-----------------------------------------
Adverse Change. Except as set forth on Schedule 3.12, the
- - - --------------
Ralston Financial Statements present fairly, in all material
respects, the consolidated financial position and results of
operations of Ralston and its subsidiaries as of the dates
thereof, all in conformity with GAAP applied on a consistent
basis, except as set forth in the notes to those financial
statements, and EBITDA of Ralston and its subsidiaries (excluding
the Ventures) is at least $42,921,000 for the nine months ended
June 30, 1996. Since June 30, 1996, there has not occurred a
Material Adverse Change of Ralston, or any event that,
individually or in the aggregate, would reasonably be expected to
result in a Material Adverse Change of Ralston. Neither this
Section 3.12 nor any other Section in this Agreement shall be
construed as a representation or warranty as to the accuracy or
attainability of budgets or projections relating to or reflecting
the business of Resorts.

3.13 Conduct of Business. Except as and to the
-------------------
extent set forth on Schedule 3.13, since June 30, 1996, Foods on
behalf of Ralston and its subsidiaries has not, and Ralston and
its subsidiaries have not:

(a) made any commitments for capital expenditures or
commitments for additions to property, plant, equipment or
intangible capital assets other than (i) those included in
the Ralston Budget or (ii) commitments for $100,000 or less
made in the ordinary course of business;

(b) acquired (by merger, consolidation or acquisition
of stock or assets) any corporation, partnership,

<PAGE> 24

-18-

joint venture, limited liability company or other business
organization, or division thereof, or entered into any
contract or agreement with respect thereto;

(c) incurred any obligations or liabilities (whether
absolute, accrued, contingent, or otherwise and whether due
or to become due), except for (i) Indebtedness which is
permitted to be incurred pursuant to Section 2.3 and
(ii) current liabilities incurred in the ordinary course of
business consistent with past practice; or experienced any
change in any assumptions underlying or methods of
calculating any bad debt, contingency or other reserve;

(d) sold, transferred or conveyed any of its properties or
assets used in Ralston's business or operations, except for
current assets sold or converted in the ordinary course of
business and consistent with past practice, or permitted or
allowed any of the properties or assets used in Ralston's
business or operations to be mortgaged, pledged or subjected
to any lien or encumbrance, except liens or encumbrances for
taxes not yet delinquent and any mortgage, pledge, lien or
encumbrance created, assumed or incurred with respect to the
real estate development of the LLC but pertaining only to
the Option Land;

(e) paid, discharged or satisfied any claim, lien,
encumbrance or liability (whether absolute, accrued,
contingent or otherwise and whether due or to become due),
other than claims, liens, encumbrances or liabilities (i)
which are reflected or accrued for or reserved against in
the Adjusted Balance Sheet and which were paid, discharged
or satisfied since the date of the Adjusted Balance Sheet in
the ordinary course of business and consistent with past
practice, or (ii) which were incurred and paid, discharged
or satisfied since the date of the Adjusted Balance Sheet in
the ordinary course of business and consistent with past
practice;

(f) written down or determined to write down or
written up or determined to write up the value of any
inventory, or written off or determined to write off as
uncollectible any notes or accounts receivable or any
portion thereof, except for immaterial write-downs or
write-offs in the ordinary course of business, consistent
with past practice and at a rate no greater than during the
prior fifty-two (52) weeks;

<PAGE> 25

-19-

(g) waived any material rights;

(h) granted any increase in the compensation of any
director of Ralston or Ralston Employee (including, without
limitation, any increase pursuant to any bonus, pension,
profit-sharing or other plan), except for increases (i) made
pursuant to the terms of any existing Employee Benefit Plan,
or (ii) occurring in the ordinary course of business in
accordance with customary practice (for purposes of the
foregoing, ordinary course of business shall be deemed to
include those customary increases granted during ongoing
negotiation of labor agreements);

(i) instituted or adopted any new Employee Benefit
Plan for any director of Ralston or any Ralston Employee;

(j) directly or indirectly redeemed, purchased or
otherwise acquired or subdivided or reclassified any Ralston
Stock;

(k) been involved in any labor dispute, litigation or
governmental investigation of any material nature;

(l) entered into any material agreement with any
local, state or federal governments or agencies; or entered
into any consulting agreements or sponsorship agreements
requiring the payment of $100,000 or more or having a term
of one year or more;

(m) made any amendments to the Articles of
Incorporation or bylaws of Ralston or any of its
subsidiaries or any organizational or operational documents
related to the Ventures to which Ralston or any of its
subsidiaries is a party; or

(n) agreed, whether in writing or otherwise, to take
any action described in this Section 3.13.

3.14 Dividends. Since June 30, 1996, Ralston has
---------
not declared or paid any dividends on its capital stock in cash,
stock or other property (other than as permitted by
Section 2.3(e)).

3.15 Absence of Undisclosed Liabilities. Other than
----------------------------------
as set forth on Schedule 3.15 or as set forth on other Schedules
hereto, or as otherwise included in the Adjusted Balance Sheet,
there are no liabilities or obligations of Ralston and

<PAGE> 26

-20-

its subsidiaries of any nature, whether absolute, accrued,
unmatured, contingent or otherwise, that would be required to be
reflected on the liability side of a balance sheet prepared in
accordance with GAAP or disclosed in the notes thereto, without
regard to materiality, other than liabilities incurred since
June 30, 1996 in the ordinary course of business related to
Ralston's operations. Each of the reserves provided for on the
Adjusted Balance Sheet has been established and maintained in
accordance with GAAP.

3.16 Title to Property. Except as set forth on
-----------------
Schedule 3.16, Ralston and its subsidiaries hold fee simple
title, subject only to Permitted Encumbrances, to all of their
respective owned real properties, and Ralston and its
subsidiaries hold a good and valid leasehold title and estate to
all of the Ralston Leased Property, including, without
limitation, all of such properties and assets reflected on the
Adjusted Balance Sheet and such assets which are necessary for
Ralston and its subsidiaries to conduct their business
substantially in the same manner as currently conducted. None of
such owned or leased properties (or such assets which are
necessary for Ralston and its subsidiaries to conduct their
business substantially in the same manner as presently conducted)
are subject to any mortgage, deed of trust, pledge, lien,
security interest, conditional sale agreement, encumbrance,
claim, mechanic's or materialmen's lien, or charge of any kind,
except liens shown on Schedule 3.16 as securing specific
liabilities (with respect to which no default, or action or
omission which with the giving of notice or passage of time or
both would constitute a default, exists) and Permitted
Encumbrances.

3.17 Real Property.
-------------

(a) All real property owned or leased (excluding
property leased for employee housing with leases having durations
less than one year or annual rental payments of less than
$20,000) by Ralston and its subsidiaries is set forth on Schedule
3.17(a)(i) (the "Ralston Leased Property") and such real property
is identified in a manner that reflects the properties which are
owned and those which are leased. Except as set forth on
Schedule 3.17(a)(ii), all building and structures required to
operate the business of Ralston substantially in the same manner
as presently conducted located on the real properties owned by
Ralston and its subsidiaries and on the Ralston Leased Property
are in good operating condition and repair (considering the age
of such buildings and structures

<PAGE> 27

-21-

and ordinary wear and tear excepted), and are usable for their
current use.

(b) Except as set forth on Schedule 3.17(b), Ralston
and its subsidiaries have not received written notice regarding
any of the following (except for matters previously resolved):
(x) any dispute from any contiguous property owners concerning
contiguous boundary lines, (y) that any of the said owned or
Ralston Leased Properties (or the buildings, structures or
improvements thereon), or Ralston's and its subsidiaries'
operations, violate the zoning or planning laws, ordinances,
rules or regulations of the city, county or state in which they
are located, or any building regulations or codes of such city,
county or state, or land use laws or regulations applicable to
said properties, and no such violations exist, or (z) any claims
of others to rights over, under, across or through any of the
owned or Ralston Leased Properties by virtue of use or
prescription. Except as set forth on Schedule 3.17, Ralston has
or is able to obtain without a material penalty or material
incremental cost, or has a valid exemption from the requirement
to obtain, all governmental permits (excluding permits from the
United States Forest Service, which are covered in Section 3.37),
approvals, authorizations or licenses required to conduct its
business in substantially the same manner as its business is
currently conducted.

(c) Foods and Ralston have either previously delivered
to Vail or will so deliver as soon as practicable prior to
Closing lists of the most recently issued real and personal
(including vehicles) property tax assessments and tax bills, if
any, for Ralston's 1994 and 1995 fiscal years for all property
owned or leased by Ralston and its subsidiaries.

(d) Except as set forth on Schedule 3.17(d), (i) all
real properties owned by Ralston or its subsidiaries are free
from agreements creating an obligation to sell, lease or grant an
option to sell or lease and (ii) all Ralston Leased Property is
free of all agreements creating an obligation to sublease, grant
an assignment of lease or grant an option to sublease.

(e) Except as set forth on Schedule 3.17(e), to the
Knowledge of Ralston, all real properties owned by Ralston and
its subsidiaries and Ralston Leased Properties are currently
zoned in the zoning category which permits operation of said
properties as now used, operated and maintained. To the
Knowledge of Ralston, the consummation of the transactions
contemplated herein will not result in a violation of any
applicable

<PAGE> 28

-22-

zoning ordinance or the termination of any applicable zoning
variance now existing.

(f) Schedule 3.17(f) lists all properties owned or
leased by Ralston and its subsidiaries which are not presently
being used in the business or operations of Ralston and its
subsidiaries.

(g) All buildings, structures or improvements owned
and/or leased by Ralston and its subsidiaries on any of the owned
or leased real properties are located entirely within the
property boundary lines of such properties and do not materially
encroach onto adjoining lands, and there are no material
encroachments of buildings, structures or improvements from
adjoining land onto such properties.

(h) To the Knowledge of Ralston, the developed owned
real properties and the Ralston Leased Property currently have
access to, at or within their property boundary lines to all gas,
water, electricity, storm, sewer, sanitary sewer, telephone, and
all other utilities necessary or beneficial to the current
operation of the owned or leased properties, and all of such
utilities are adequate and sufficient for the current operation
of such properties, subject to normal interruptions in the
ordinary course.

(i) Ralston and its subsidiaries hold a valid
leasehold estate for each Ralston Leased Property, as shown on
Schedule 3.17(a)(i), and enjoy peaceful and undisturbed
possession thereunder. All such leases are valid, binding and
enforceable in accordance with their terms, and are in full force
and effect, Ralston and its subsidiaries have complied with all
material obligations thereunder, and there are no existing
defaults by Ralston and its subsidiaries, and, except as set
forth in Schedule 3.17(i), there are no existing defaults by any
other party thereunder. No event has occurred which (whether
with or without notice, lapse of time or the happening or
occurrence of any other event) would constitute a default by
Ralston and its subsidiaries and no event has occurred which
(whether with or without notice, lapse of time or the happening
or occurrence of any other event) would constitute a default by
any other party thereunder. Except as disclosed on Schedule
3.17(i), all such leases shall continue in full force and effect
(without default) after the Closing and the consummation of the
transactions contemplated by this Agreement without the consent,
approval or act of any other party, except to the extent that
enforceability may be limited

<PAGE> 29

-23-

by applicable bankruptcy, insolvency, reorganization, moratorium
or other laws affecting the enforcement of creditors' rights
generally or by general equitable or fiduciary principles.

3.18 Personal Property. Except as set forth on
-----------------
Schedule 3.18(a), and except for any immaterial exceptions,
restrictions or limitations contained in financing statements
with respect to such property, Ralston and its subsidiaries own,
or have a valid lease or license with respect to, the tangible
personal property (including without limitation ski lift systems
and snowmaking equipment and systems) which is necessary for the
operation of their business substantially in the same manner as
currently conducted, free and clear of all liens, mortgages,
pledges, security interests, charges or encumbrances other than
Permitted Encumbrances, and enjoy peaceful and undisturbed
possession thereunder. Except as set forth on Schedule 3.18(b)
or as expressly set forth in the Ralston Budget, all such
property that is material to the operations of Ralston is in
reasonably good operating condition and repair, ordinary wear and
tear excepted, and is suitable for the purposes for which it is
used. Schedule 3.18(c) contains a list of each lease pursuant to
which Ralston and its subsidiaries lease personal property which
involves payment over the remaining term of such lease of more
than $100,000 and which in each case is not cancelable upon six
months' notice or less without penalty of more than $100,000.
All such personal property leases are valid, binding and
enforceable in accordance with their terms and are in full force
and effect, Ralston and its subsidiaries have complied with all
obligations thereunder and there are no existing material
defaults by Ralston and its subsidiaries or, to the Knowledge of
Ralston, by any other party thereunder; no event has occurred
which (whether with or without notice, lapse of time or the
happening or occurrence of any other event) would constitute a
material default by Ralston and its subsidiaries thereunder; and
no event has occurred which (whether with or without notice,
lapse of time or the happening or occurrence of any other event)
would constitute a material default by any other party
thereunder. Except as set forth on Schedule 3.18(d), all
personal property leases which are set forth on Schedule 3.18(c)
hereto shall continue in effect after the Closing and the
consummation of the transactions contemplated by this Agreement
without the consent, approval or act of any other party. All
unperformed contracts to purchase personal property to which
Ralston and its subsidiaries are party which provide for a
purchase price of $100,000 or more are set forth on Schedule
3.18(e).

<PAGE> 30

-24-

3.19 Litigation and Claims. Schedule 3.19 sets
---------------------
forth all pending judicial or administrative investigations,
lawsuits, actions or proceedings against Ralston and its
subsidiaries of which Foods or Ralston and its subsidiaries have
received written notice. Except as set forth on Schedule 3.19,
there are no actions, suits, investigations, administrative
proceedings or orders pending or, to Foods' Knowledge, threatened
against (i) Foods, at law or in equity, which, if adversely
determined, would have an adverse effect on the ability of Foods
to perform the terms of this Agreement, or would interfere with
the ability of Vail to consummate the transactions contemplated
herein, or (ii) Ralston or any of its subsidiaries, at law or in
equity.

3.20 Compliance with Laws. Except as set forth on
--------------------
Schedule 3.20, to the Knowledge of Ralston, Ralston and its
subsidiaries are not in violation of any law, rule or regulation
or in default in any material respect with respect to any
judgment, writ, injunction or decree of any federal, state or
local commission.

3.21 Orders and Consent Decrees. Except as set
--------------------------
forth on Schedule 3.21, or as specifically cross-referenced
thereon from other Schedules hereto, Ralston and its subsidiaries
are not party to, or bound by, any material judicial or
administrative order, judgment, decree or consent decree relating
to any past or present practice, omission, activity or
undertaking. To the Knowledge of Ralston, Ralston and its
subsidiaries are not in default in any material respect under any
of the judicial or administrative orders, judgments, decrees or
consent decrees or conciliation or compliance agreements set
forth on Schedule 3.21.

3.22 Labor Agreements. There are no binding
----------------
agreements of any type with any labor union, labor organization,
collective bargaining unit or employee group to which Ralston and
its subsidiaries are bound except those set forth on Schedule
3.22. All agreements that are set forth on Schedule 3.22 are
legal and valid and, except for those that are presently under
negotiation or renegotiation due to the expiration of their
stated term, are in full force and effect. Further:

(a) Except for negotiations ongoing as of the date
hereof, or as otherwise set forth on Schedule 3.22(a),
Ralston and its subsidiaries have not agreed to any terms
and conditions to be added or deleted in future

<PAGE> 31

-25-

negotiations or otherwise regarding the agreements set forth
on Schedule 3.22.

(b) To the Knowledge of Ralston, there are no
threatened or active strikes, work stoppages, boycotts or
concerted actions against Ralston and its subsidiaries,
other than those threats which commonly arise as a result of
normal labor contract renegotiations.

(c) Except as set forth on Schedule 3.22(c), Foods has
no notice of any pending (i) proceedings under the National
Labor Relations Act or before the National Labor Relations
Board, (ii) grievances or arbitrations, or (iii)
organizational drives or unit clarification requests, in
each case against or affecting Ralston or any of its
subsidiaries.

3.23 Employees. Except as set forth on Schedule
---------
3.23, Ralston and its subsidiaries have not received any written
notice from a governmental authority or official during the past
two years of any non-compliance with any federal, state or local
laws, regulations and legal requirements relating to the
employment of labor in connection with their business, including
those laws, regulations and legal requirements relating to wages,
hours, benefits, affirmative action, equal opportunity, including
the Americans with Disabilities Act and the Occupational Safety
and Health Act, collective bargaining, workers' compensation and
the payment of social security, unemployment and employment
taxes.

3.24 Contracts. All contracts of Ralston or any
---------
of its subsidiaries which involve aggregate payments after the
date of this Agreement of $100,000 or more are set forth on
Schedule 3.24 or are specifically cross-referenced thereon from
other Schedules hereto. Except as set forth on Schedule 3.24,
Ralston and its subsidiaries are not party to or obligated under
any written agreement or contract that:

(a) provides for the employment of any Corporate
Officer of Ralston not terminable at will and without
liability for additional payments or compensation, other
than severance and vacation pay payable in accordance with
the established policies of Ralston as set forth on Schedule
3.24;

(b) provides for (i) the employment of any consultant
or broker for a term that would exceed one (1) year

<PAGE> 32

-26-

from the date of the Closing, or provides for payments that
exceed $100,000, or (ii) the employment of any independent
attorney or accounting firm not terminable at will;

(c) would prohibit or limit in any material respect
Ralston or any of its subsidiaries from engaging in its
present business;

(d) requires the purchase of materials, inventories
services or supplies that has a remaining contractual term
of more than one (1) year from the Closing, or would require
payments in the aggregate in excess of $100,000;

(e) involves the sale of any asset or property of
Ralston or any of its subsidiaries presently being used in
Ralston's or any of its subsidiaries' business or
operations, other than in the normal course of business;

(f) relates to the borrowing of money or bank credit
(including, but not limited to, indentures, notes,
installment obligations and capital leases) or the
mortgaging or pledging of any asset or property of Ralston
or any of its subsidiaries;

(g) guarantees the obligations of any supplier,
customer or other third party, other than endorsements in
the ordinary course;

(h) is a forward, swap, option or swaption contract or
any other financial instrument with similar characteristics
and/or generally characterized as a "derivative" security to
which Ralston or any of its subsidiaries are a party or to
which Ralston or any of its subsidiaries or any of their
respective assets or properties is subject or bound
(including, without limitation, funds of Ralston invested by
any other person); or

(i) includes any indemnity provisions for claims based
on product liability, environmental or employee or retiree
liabilities and arises out of any purchase or acquisition of
another entity or business.

3.25 Validity of Material Contracts.
------------------------------

(a) Except as set forth on Schedule 3.25(a), Ralston
and its subsidiaries have not: (i) received any written claim

<PAGE> 33

-27-

of breach or default from any party relating to any agreement,
commitment or contract listed on Schedule 3.24; or (ii) received
any written notice of termination from any party relating to any
such agreement, commitment or contract.

(b) Except as set forth on Schedule 3.25(b), Ralston
and its subsidiaries have not breached or defaulted in any
material respect on any agreement, commitment or contract listed
on Schedule 3.24.

3.26 Trademarks and Copyrights.
-------------------------

(a) Schedule 3.26(a)(i) lists all registered trade-
marks and copyrights owned by Ralston and its subsidiaries and
the jurisdictions in which such are registered or in which an
application has been filed for such registration. Schedule
3.26(a)(ii) lists each license or sublicense (with a term
exceeding one year or with a royalty payment of more than $1,000)
to which Ralston and its subsidiaries are a party and pursuant to
which any other person or entity is authorized to use any such
trademark or copyright. All trademarks and copyrights listed on
Schedule 3.26(a)(i) are owned by Ralston and its subsidiaries
and, except as disclosed on Schedule 3.26(a)(iii), are free and
clear of any known adverse claim of any third party.

(b) Except as set forth on Schedule 3.26(b), to the
Knowledge of Ralston, Ralston and its subsidiaries do not
infringe or unlawfully or wrongly use any trademark or copyright
rights owned or claimed by any other party.

(c) To the Knowledge of Ralston, except as disclosed
on Schedule 3.26(c), no third party is now making any infringing
use of any Ralston trademark or copyright.

(d) Except as disclosed on Schedule 3.26(d) or
required to be disclosed on Schedule 3.26(a)(ii), Ralston and its
subsidiaries have not sold or otherwise disposed of, or
transferred or granted, any interest in such Ralston trademarks
or copyrights listed on Schedule 3.26(a)(i).

(e) To the Knowledge of Ralston, no claims are being
asserted by any person against the use of any of the trademarks
or copyrights listed on Schedule 3.26(a)(i), or challenging or
questioning the validity or effectiveness of any license or
agreement related thereto. Except as disclosed on Schedule
3.26(e), none of the Ralston trademarks or copyrights is

<PAGE> 34

-28-

subject to any outstanding order, judgment or decree restricting
the use thereof by Ralston and its subsidiaries, or restricting
the licensing thereof by Ralston and its subsidiaries to any
other person or entity.

3.27 Powers of Attorney. Except as set forth on
------------------
Schedule 3.27, neither Ralston nor any of its subsidiaries has
any material outstanding revocable or irrevocable Powers of
Attorney or similar authorizations issued to any individual who
is not a Ralston Employee.

3.28 Taxes.
-----

(a) Ralston, the affiliated group, within the meaning
of Section 1504 of the Code, of which Ralcorp is the common
parent and any other affiliated group, within the meaning of
Section 1504 of the Code, of which Ralston has been a member at
any time since its date of incorporation (an "Affiliated Group"
and, collectively, the "Affiliated Groups") have timely filed on
or before the date hereof all Tax Returns required to be filed in
accordance with all applicable laws (taking into account all
extensions of due dates), and all such Tax Returns are true,
correct and complete and all amounts shown thereon as owing have
been paid. Except as set forth on Schedule 3.28(a): (i) all Tax
bills or Tax assessments received by or with respect to Ralston
have been paid (to the extent the Taxes shown thereon are due and
owing); (ii) all Taxes with respect to Ralston and the Affiliated
Groups (whether or not shown on any Tax Returns) have been paid
or accrued and all deficiencies for Taxes asserted or assessed by
a taxing authority against Ralston or an Affiliated Group have
been paid or finally settled or are being contested by
appropriate proceedings; (iii) no claim is currently being made
by an authority in a jurisdiction where Ralston or an Affiliated
Group does not file Tax Returns that it is or may be subject to
taxation by that jurisdiction; and (iv) there are no liens on any
of the assets of Ralston or an Affiliated Group that arose in
connection with any failure (or alleged failure) to pay any Tax.
The term "Ralston" when used in this Section 3.28 means Ralston
and its subsidiaries.

(b) Ralston and the Affiliated Groups have collected
or withheld and paid on a timely basis all Taxes required to have
been collected or withheld and paid to any taxing authority in
connection with amounts paid or owing to any employee,
independent contractor, creditor, shareholder or other third
party.

<PAGE> 35

-29-

(c) Except as set forth on Schedule 3.28(c), neither
Ralston nor an Affiliated Group has received any written notice
of pending or threatened actions, audits, proceedings or
investigations for the assessment or collection of Taxes.

(d) Except as set forth on Schedule 3.28(d), neither
Ralston nor an Affiliated Group has waived any statute of
limitations in respect of Taxes or agreed to any extension of
time with respect to a Tax assessment or deficiency (but only to
the extent such waiver or extension is still in effect) nor are
there any outstanding requests for any extension of time within
which to pay any Taxes not yet paid. For all taxable periods
subsequent to the fiscal year ended September 30, 1990, Foods has
provided to Vail (i) true, correct and complete copies of federal
Form 1120 pro forma returns for Ralston and all other information
(compiled in a true, correct and complete manner) relating to
income, deductions, credits and Taxes of Ralston that is not
included in the pro forma returns, (ii) all statements of federal
Income Tax deficiencies assessed against, or attributable to,
Ralston or an Affiliated Group and (iii) a true, correct and
complete copy of any Tax Sharing Agreement to which Ralston is a
party and a true, correct and complete description of any such
Tax Sharing Agreement not reduced to writing.

(e) Except as set forth on Schedule 3.28(e), neither
Ralston nor an Affiliated Group has made, is obligated to make or
is a party to any contract, agreement, arrangement or plan
covering any Ralston Employee that (taking into account the
transactions contemplated by this Agreement) could obligate it to
make any payments that would not be deductible under Section 162
of the Code (by reason of being unreasonable in amount), Section
404, Section 162(m) or Section 280G of the Code.

(f) Schedule 3.28(f) sets forth the following
information with respect to Ralston as of the most recent
practicable date: (i) the tax basis of Ralston's assets; and
(ii) the amount of any net operating loss, net capital loss, tax
credit or other carryover allocable to Ralston.

(g) Except as set forth on Schedule 3.28(g), Ralston
is not a party to any joint venture, partnership or other
arrangement or contract that could be treated as a partnership
for federal income tax purposes.

(h) The unpaid Taxes of Ralston do not exceed the
reserve for Tax liability as computed in a manner consistent

<PAGE> 36

-30-

with the prior and customary accounting practice of Ralston
(excluding any reserve for deferred Taxes established to reflect
timing differences between book and tax income) set forth or
included in the Adjusted Balance Sheet.

(i) All Consolidated Returns and Unitary Returns (as
defined below), and all state, local and foreign Tax Returns of
Ralston and the Affiliated Groups have been closed by applicable
statute of limitations for all taxable years ending on or before
the dates shown on the attached Schedule 3.28(i). "Consolidated
Return" shall mean any consolidated federal Income Tax Return
filed by an Affiliated Group, and "Unitary Return" shall mean any
Return with respect to any Taxes, other than federal Income
Taxes, filed, or required to be filed, on a consolidated,
combined or unitary basis by any group of corporations of which
Ralston is a member or has been a member at any time since its
date of incorporation.

(j) Ralston and the Affiliated Groups have made all
payments of estimated Taxes required to be made with respect to
any of them under Section 6655 of the Code and any comparable
provisions of state, local and foreign law.

(k) No power of attorney has been granted by Ralston
or an Affiliated Group with respect to any matter relating to
Taxes which is currently in force.

(l) No consent has been filed under Section 341(f) of
the Code with respect to Ralston or an Affiliated Group.

(m) Neither Ralston nor an Affiliated Group has
incurred or assumed any corporate acquisition indebtedness, as
defined in Section 279(b) of the Code.

3.29 Employee Benefit Plans.
----------------------

(a) All Employee Benefit Plans sponsored by Ralcorp,
Foods or Ralston or their Affiliates and covering Ralston
Participants are set forth on Schedule 3.29(a) (the "Ralston
Employee Benefit Plans"). With respect to each Ralston Employee
Benefit Plan, copies of the following have been delivered to Vail
where applicable: (i) the Plan document; (ii) a summary plan
description; (iii) most recent Annual Return/Report of Employee
Benefit Plan, Form 5500 Series; (iv) trust agreement;
(v) insurance policy; and (vi) determination letter from the IRS.
The Ralston Employee Benefit Plans have in all material respects
been maintained and

<PAGE> 37

-31-

administered in compliance with applicable federal and state
laws, regulations and rules, including, but not limited to, ERISA
and the Code. All contributions required as of the Closing, by
law or contract, to be made to each Ralston Employee Benefit Plan
will have been timely made.

(b) No Ralston Employee Benefit Plan (or trust or
other funding vehicle pursuant thereto) is subject to any Tax
under Section 511 of the Code that remains unpaid and assessable
against Ralston after the Closing.

(c) Neither Ralston nor any plan fiduciary of any
Ralston Employee Benefit Plan has engaged in any transaction in
violation of Section 404 or 406 of ERISA, or in any "prohibited
transaction" as defined in Section 4975(c)(1) of the Code, for
which no exemption exists under Section 408 of ERISA, or in
violation of Section 4975(c)(2) or 4975(d) of the Code.

(d) Except as listed on Schedule 3.29(d), neither
Ralston nor any Ralston Employee Benefit Plan is a party to any
litigation with respect to Ralston Participants relating to, or
seeking benefits under, any Employee Benefit Plan.

(e) Except as set forth on Schedule 3.29(e) and except
as may be required by the terms of a collective bargaining
agreement or in connection with any pending labor negotiations,
neither Ralston nor any ERISA Affiliate has any legally binding
commitments to create any additional Employee Benefit Plans which
are intended to cover Ralston Employees, or to amend or modify
any existing Employee Benefit Plan with respect to benefits for
Ralston Employees. With respect to each collective bargaining
agreement, there is no legally binding commitment to create any
additional Employee Benefit Plans which are intended to cover
Ralston Employees, to amend or modify any existing Employee
Benefit Plan which covers or has covered Ralston Employees, or to
begin contributing, or increase contributions, to a Multiemployer
Plan, which would materially increase the benefits to be provided
under such collective bargaining agreement.

(f) Except as described on Schedule 3.29(f), the
execution and performance of the transactions contemplated by
this Agreement, and such other agreements, instruments and
documents required to be executed in connection therewith, shall
not constitute an event under any Employee Benefit Plan or
agreement under which Ralston may incur any liability that will
result in any payment (whether severance pay or otherwise),

<PAGE> 38

-32-

acceleration, vesting or increase of benefits with respect to any
Ralston Employee.

(g) Schedule 3.29(g) sets forth the policy as to
severance benefits for Ralston Employees in effect at the
Closing, as well as the names of each Ralston Employee that has a
specific severance arrangement other than the policy.

(h) Each Ralston Employee Benefit Plan which is a
retirement plan or a savings plan has been established and
operated so as to be qualified and tax exempt under the
provisions of Code Sections 401(a) and 501(a) from its adoption
to date and will be so as of the Closing. Neither Foods nor any
of its affiliates has, by its action or inaction, adversely
affected the qualified status of any such Ralston Employee
Benefit Plan.

(i) Schedule 3.29(i) sets forth a summary of the
retiree health and retiree life insurance benefits provided at
the Closing to all Ralston Employees who are not covered by a
collective bargaining agreement.

(j) All Ralston Employee Benefit Plans under which
benefits are provided under health maintenance and preferred
provider organizations are set forth on Schedule 3.29(j).

(k) Except as set forth on Schedule 3.29(k), neither
Ralston (since January 1, 1989) nor any ERISA Affiliate has been
a party to any Multiemployer Plan.

(l) Neither Ralston nor any of its ERISA Affiliates
have incurred any liability under Title IV of ERISA (other than
for contributions not yet due or for the payment of premiums not
yet due), which liability has not been fully paid as of the date
hereof.

3.30 Environmental Matters. Except as set forth
---------------------
on Schedule 3.30:

(a) Ralston and its subsidiaries have obtained (or are
capable of obtaining without incurring any material
incremental expense) all Environmental Permits and all
licenses and other authorizations and have made all
registrations and given all notifications that are required
under any applicable Environmental Law.

<PAGE> 39

-33-

(b) Except as set forth on Schedule 3.30(b), there is
no Environmental Claim pending (excluding any of the
foregoing with respect to which Foods and/or Ralston have
not received service of process or notice, as the case may
be, except if Foods and/or Ralston have Knowledge of the
existence thereof) against Ralston and its subsidiaries
under an Environmental Law.

(c) Except as set forth on Schedule 3.30(c), Ralston
and its subsidiaries are in compliance with all terms and
conditions of their Environmental Permits, and are in
compliance with all applicable Environmental Laws.

(d) Except as set forth on Schedule 3.30(d), Ralston
and its subsidiaries did not generate, treat, store,
transport, discharge, dispose of or release any Hazardous
Substances on any property now or previously owned, leased
or used by Ralston and its subsidiaries.

3.31 Liability and Casualty Insurance. Schedule
--------------------------------
3.31 sets forth a description of each liability or casualty
insurance policy (including, without limitation, fire and product
liability policies) including self-insurance maintained on the
property, assets and business of Ralston and its subsidiaries,
specifying the insurer, the amount of coverage, the type of
insurance, the policy number, the expiration date and the annual
premium. All such policies: (i) are valid, outstanding and
enforceable policies; (ii) shall remain in full force and effect
until their respective expiration dates as set forth on
Schedule 3.31 without the payment of additional premiums other
than additional premiums required in the ordinary course prior to
the Closing; and (iii) except as noted on Schedule 3.31, shall
not in any way be adversely affected by, or terminate or lapse by
reason of, the transactions contemplated by this Agreement.

3.32 Consents or Approvals.
---------------------

(a) All consents and approvals of any third party
required by the terms hereof or required to consummate the
transactions contemplated herein have been obtained or, prior to
the Closing, will be obtained and shall remain in full force and
effect through the Closing.

(b) Except as set forth in Schedule 3.32, no consent,
waiver, approval or authorization, registration, declaration or
filing with any court, administrative agency or

<PAGE> 40

-34-

commission or other governmental authority or instrumentality,
domestic or foreign, is required by or with respect to Foods or
Ralston in connection with the execution and delivery of this
Agreement, and such other agreements, instruments and documents
required to be executed by Foods or Ralston in connection
herewith contemplated herein and therein, or the consummation by
Foods or Ralston of the transactions contemplated herein and
therein.

3.33 Transaction Fees. Except as set forth on
----------------
Schedule 3.33, neither Foods, Ralston nor any member of their
respective boards of directors has any agreement or
understanding, or has incurred any liability, requiring the
payment of a finder's fee, brokerage commission or like cost or
charge to any person by reason of this Agreement or the
transactions contemplated herein. Foods is solely responsible
for all fees, commissions and other costs of the persons listed
on Schedule 3.33 and neither Ralston nor any of its subsidiaries
has any responsibility therefor.

3.34 Bank Accounts. Vail has been provided a
-------------
listing of all Ralston and its subsidiaries' bank accounts and
lock boxes and Foods bank accounts and lock boxes used by Ralston
and its subsidiaries, including the names and locations of all
such banking institutions and depositories, the account numbers,
and the names of all persons authorized to draw thereon or to
have access thereto.

3.35 Ownership of Ralston Stock; Ralston Assets.
------------------------------------------
Foods is the owner of record, and the legal and beneficial owner,
of all of the outstanding shares of Ralston Stock, and Foods has
the full right, power and authority to transfer, convey and
deliver good, valid, marketable and indefeasible title to such
shares of Ralston Stock to Vail, or its nominee, as called for
under this Agreement, free and clear of any liabilities,
obligations, options, charges, encumbrances, liens, claims,
interests, powers of attorney, restrictions or contractual rights
of others of any kind whatsoever. Except as set forth on
Schedule 3.35, none of the assets used or useful in the business
of Ralston and its subsidiaries is owned by Foods or any of its
Affiliates (other than Ralston and its subsidiaries) and neither
Foods nor any of its Affiliates (other than Ralston and its
subsidiaries) owns directly or indirectly any asset included in
the Adjusted Balance Sheet.

3.36 Vail Stock Acquired for Foods' Account. The
--------------------------------------
Vail Stock to be acquired by Foods pursuant to this Agreement

<PAGE> 41

-35-

is being acquired for Foods' own account. Foods has no intention of
distributing or reselling such stock or any part thereof in any
transaction that would be in violation of the Securities Act of
1933, or the state securities law of any state.

3.37 United States Forest Service.
----------------------------

(a) Except as set forth on Schedule 3.37(a), Ralston's
operations and those of its subsidiaries comply, in all material
respects with the terms and conditions set forth in each of the
Term Special Use Permits issued by the United States Department
of Agriculture, Forest Service (the "USFS") to Ralston or its
subsidiaries and all documents incorporated in such permits
(collectively, the "USFS Permits") and such permits are in full
force and effect and neither Ralston nor its subsidiaries have
received any notice of default under the USFS Permits;

(b) Except as set forth on Schedule 3.37(b), neither
Ralston nor its subsidiaries have received any written notice of
nor have any Knowledge that the USFS has any intention of
amending, revoking or otherwise altering the terms or conditions
of any of the USFS Permits, or portion thereof, or the
application of the USFS Permits to Ralston's or its subsidiaries'
operations;

(c) Except as set forth on Schedule 3.37(c), neither
Ralston nor its subsidiaries are engaged in any on-going dispute
or disagreement with the USFS over the interpretation or
application of any term or condition of any of the USFS Permits;
and

(d) Except as set forth on Schedule 3.37(d), Ralston
has no Knowledge of any third-party permittee or commercial
operator operating within the areas permitted to Ralston or its
subsidiaries under any of the USFS Permits.

3.38 Passenger Tramway.
-----------------

(a) Except as set forth on Schedule 3.38(a), neither
Ralston nor its subsidiaries have had, in the past three (3) ski
seasons, any passenger tramway incidents that required reporting
to the Colorado Passenger Tramway Safety Board (the "CPTSB")
under CPTSB laws, rules, regulations and standards.

<PAGE> 42

-36-

(b) Except as set forth on Schedule 3.38(b), each
passenger tramway operated by Ralston or its subsidiaries
complies in all material respects with current laws, rules,
regulations and standards of CPTSB and the American National
Standards Institute ("ANSI") and, further, there are no defects
or conditions which are "grandfathered" under CPTSB or ANSI laws,
rules, regulations and standards.

(c) Except as set forth on Schedule 3.38(c), Ralston
and its subsidiaries have maintained in all material respects,
each passenger tramway owned or operated by Ralston or its
subsidiaries according to all CPTSB laws, rules, regulations and
standards and all maintenance and replacement procedures and
standards recommended by the manufacturer, or manufacturer's
successor, of each such passenger tramway and, further, no such
maintenance or replacement is now outstanding or has been
otherwise deferred or delayed beyond the manufacturer's
recommended maintenance and replacement schedule.

(d) Except as set forth on Schedule 3.38(d), neither
Ralston nor its subsidiaries have any Knowledge of any defect or
condition that would preclude or materially limit the normal
operation of any passenger tramway owned or operated by Ralston
or its subsidiaries.

3.39 Clean Water Act.
---------------

(a) To Ralston's Knowledge, there have been no
material discharges of dredged or fill material into any waters
of the United States, or any other activity, on or within
property owned or operated by Ralston or its subsidiaries in
violation of the Clean Water Act, 33 U.S.C. 1344, and its
implementing regulations (collectively, the "Clean Water Act"),
other than discharges or other activities pursuant to permits
(the "Existing Permits").

(b) Except as described on Schedule 3.39(b), to
Ralston's Knowledge, the Existing Permits are in full force and
effect and neither Ralston, its subsidiaries nor anyone acting
for or on behalf of Ralston or its subsidiaries has materially
violated nor is currently and materially in violation of any of
the terms and conditions of the Existing Permits and there are no
outstanding mitigation requirements or unsatisfied conditions
contained in any of the Existing Permits. Ralston represents
that it has all permits required under the Clean Water Act.

<PAGE> 43

-37-

3.40 Keystone/Intrawest L.L.C.
------------------------

(a) The LLC is duly organized, validly existing and in
good standing under the laws of the State of Delaware and has all
requisite power and authority and the legal right to own, lease
and operate its properties and to carry on its business as now
being conducted. The LLC is duly qualified or licensed to do
business and in good standing in Colorado. True and correct
copies of the LLC Agreements (as amended) and the Certificate of
Formation (the "Certificate") filed with the Delaware Secretary
of State have been delivered to Vail and, except as described on
Schedule 3.40(a), neither the LLC Agreement nor the Certificate
has been amended (whether in writing or via oral agreement or
understanding) and each of the LLC Agreement and the Certificate
are in full force and effect. The LLC is not in violation of its
organizational documents.

(b) Ralston owns beneficially and of record an
undivided 50% interest in the LLC (the "Ralston Interest") and
has good and marketable title to the Ralston Interest, and
Ralston has the absolute right to sell, assign and transfer the
Ralston Interest to Vail free and clear of all liens. There are
no existing options, warrants, calls, subscriptions or other
rights or agreements or commitments or claims of any nature
granted by or binding upon Ralston granting or vesting in any
party any claim or potential claim to the Ralston Interest.
Intrawest owns beneficially and of record an undivided 50%
interest in the LLC.

(c) Except as set forth on Schedule 3.40(c), to
Ralston's Knowledge, neither delivery of this Agreement nor the
consummation of the transactions contemplated on the part of
Ralston to be performed, nor the fulfillment of the terms hereof,
constitute a default under, require consent under, give any
person any right to terminate any (A) note, bond, mortgage,
indenture or other monetary obligation or instrument, or (B) any
material license, contract or other agreement, in either case, to
which the LLC is a party or by which it or any of its properties
or assets may be bound.

(d) To Ralston's Knowledge, there are no actions,
suits or proceedings pending or threatened against the LLC.

(e) Except as set forth on Schedule 3.40(e) (which
Schedule outlines the current outstanding balance of any such
debt) and to Ralston's Knowledge, the LLC is not indebted to

<PAGE> 44

-38-

any third party and is not currently obligated for the repayment
of any loan or debt.

(f) To Ralston's Knowledge, the LLC has obtained all
of the governmental licenses and permits required to own and
operate its properties and business as currently owned and
operated, such licenses and permits are in full force and effect,
and no violation exists in respect of any such license or permit.
To Ralston's Knowledge, the LLC has complied in all material
respects with all laws, regulations, ordinances and orders that
relate to any of its properties and assets.

(g) To Ralston's Knowledge, the LLC is not in default
of any material covenant or obligation under any agreement to
which the LLC is a party, and no events have occurred which with
the passage of time or giving of notice would constitute such a
material default.

(h) Ralston is not in default under the LLC Agreement
or the Contribution Agreement and no events have occurred which
with the passage of time or the giving of notice would constitute
such a default. Ralston has not waived any material requirement
set forth in the LLC Agreement or the Contribution Agreement. To
the Knowledge of Ralston, Intrawest is not in default in any
material respect under the LLC Agreement or the Contribution
Agreement or the Management Agreement and no events have occurred
that with the passage of time or the giving of notice would
constitute such a default.

(i) Except as set forth on Schedule 3.40(i), Ralston
has not received any distribution (in cash or other property)
from the LLC.

(j) There are no bankruptcy, reorganization or
arrangement proceedings pending, being contemplated by or, to the
Knowledge of Ralston, threatened against the LLC.

(k) Neither Ralston nor any of its subsidiaries has
sold, conveyed, transferred, assigned or otherwise disposed of
any portion of the Option Lands.

(l) Except as set forth in Schedule 3.40(l), neither
Ralston nor any of its Subsidiaries has loaned money to or
otherwise participated in any real estate development project
described in Section 3.02(b) of the LLC Agreement.

<PAGE> 45

-39-

(m) Ralston has fully satisfied and fully performed
all of its material obligations under the Contribution Agreement
and all transactions contemplated therein have been fully
performed and closed.

(n) Ralston has not made any Other Capital
Contributions (as such term is defined in the LLC Agreement),
except as set forth in Schedule 3.40(n), and such Schedule
reflects all Capital Contributions made by Ralston to the LLC
since the LLC's formation.

(o) Neither Ralston nor Intrawest has made any Default
Loans (as such term is defined in the LLC Agreement), and Ralston
has not received or given any notice of a failure to make a
Capital Contribution (as such term is defined in the LLC
Agreement). There are no outstanding requirements of either
Ralston or Intrawest to make Capital Contributions to the LLC.

(p) The current Annual Budget (as such term is defined
in the LLC Agreement), and each Project Budget (as such term is
defined in the LLC Agreement) has been delivered to Vail and,
except as set forth on Schedule 3.40(p), to Resort's Knowledge
there are currently no material deviations from such budgets.

(q) Neither Ralston nor, to Ralston's Knowledge,
Intrawest has committed any act or omission that could cause a
dissolution of the LLC under Article 10 of the LLC Agreement.

(r) As of the date of this Agreement, the LLC has
commenced the construction of a minimum of 260 residential units
at the Base I Property (as such term is defined in the LLC
Agreement).

(s) As of the date of this Agreement, Ralston has not
purchased any Additional Property (as such term is defined in the
LLC Agreement), and Ralston will not purchase any such Additional
Property during the term of this Agreement.

(t) True and correct copies of the Contribution
Agreement and the Management Services Agreement have been
delivered to Vail and neither of such agreements has been amended
and each of such agreements are in full force and effect.

<PAGE> 46

-40-

(u) Ralston has delivered to Vail, copies of the most
currently available LLC balance sheet and a summary of projects
undertaken by the LLC which, to Ralston's Knowledge are true and
correct.

(v) Except as described on Schedule 3.40(v), projects
undertaken by the LLC are not subject to requirements or
agreements of any kind not contained in the PUD which would
require Ralston to provide for ski or lift access, infrastructure
improvements or employee housing in connection with any such
project.

(w) Except as set forth in Schedule 3.40(w), the LLC
holds fee simple title, subject only to Permitted Encumbrances,
to all of its owned real properties. None of the LLC's owned
properties are subject to any mortgage, deed of trust, pledge,
lien, security interest, conditional sale agreement, encumbrance,
claim, mechanic's or materialmen's lien or charge of any kind,
except liens shown on Schedule 3.40(w) as securing specific
liabilities and Permitted Encumbrances or except as securing
Indebtedness of the LLC relating to development or infrastructure
projects, a listing of which is set forth on Schedule 3.40(w).

(x) To Ralston's Knowledge, the LLC is not in
violation of any law, rule or regulation or in default in any
material respect with respect to any judgment, writ, injunction
or decree of any federal, state or local commission, nor is the
LLC party to, or bound by any material judicial or administrative
order, judgment, decree or consent decree relating to any past or
present practice or undertaking.

(y) To Ralston's Knowledge, the LLC has obtained (or
is capable of obtaining without incurring any material expense)
all Environmental Permits and all licenses and other
authorizations and have made all registrations and given all
notifications that are required under any applicable
Environmental Law. To Ralston's Knowledge, there is no
Environmental claim pending against the LLC or pertaining to
property owned by the LLC, under an Environmental Law.

3.41 Water Rights. The representations and
------------
warranties set forth on Schedule 3.41 are incorporated herein by
reference.

<PAGE> 47

-41-

ARTICLE IV

VAIL'S REPRESENTATIONS AND WARRANTIES

Vail represents and warrants that:

4.1 Capital Stock. The authorized capital stock
-------------
of Vail consists of 20,000,000 shares of Class A Common Stock,
par value $.01 per share (the "Class A Common Stock"), 40,000,000
shares of Vail Stock and 25,000,000 shares of Preferred Stock,
par value $.01 per share (the "Preferred Stock" and together with
the Vail Stock and Class A Common Stock the "Capital Stock"). As
of the date of this Agreement, there are 3,612,809 shares of Vail
Stock issued and outstanding; 6,387,191 shares of Class A Common
Stock issued and outstanding; and zero shares of Preferred Stock
issued and outstanding. All outstanding shares of Capital Stock
are duly authorized, validly issued, fully paid and
non-assessable. Except as set forth on Schedule 4.1, there are
no options, warrants, calls or agreements of any character for
the issuance of additional shares of Capital Stock. Except as
set forth on Schedule 4.1, there are no contracts for the
authorization or issuance of any other class of securities of
Vail, and there are no outstanding securities convertible or
exchangeable into Capital Stock.

4.2 Transfer of the Vail Stock. The Vail Stock to
--------------------------
be issued to Foods pursuant to this Agreement shall be duly and
validly authorized and, when issued and delivered pursuant to
this Agreement, shall be validly issued, fully paid and
non-assessable and shall transfer to and vest in Foods, or its
nominee, good, valid, marketable and indefeasible title to such
shares of the Vail Stock, subject to no lien, security interest
or other encumbrance on such Vail Stock.

4.3 Authority of Vail.
-----------------

(a) Vail has taken all action required by its
Certificate of Incorporation and its bylaws to authorize the
execution and delivery of this Agreement, and such other
agreements, instruments and documents required to be executed by
Vail in connection herewith, and the performance of the
transactions contemplated herein and therein. Vail has all
requisite corporate power and authority to authorize the
execution and delivery of this Agreement, and such other
agreements, instruments and documents required to be executed in
connection herewith, to consummate the transactions contemplated
herein

<PAGE> 48

-42-

and therein, and to take all other actions required to be taken
by Vail pursuant to the provisions hereof. This Agreement,
and such other agreements, instruments and documents required to
be executed in connection herewith, when duly executed and
delivered, shall constitute a valid and binding obligation of
Vail enforceable in accordance with its terms except to the
extent that enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other laws
affecting the enforcement of creditors' rights generally or by
general equitable or fiduciary principles.

(b) No approvals on the part of any class (whether
voting together or as separate classes) of Vail's shareholders
are necessary to authorize this Agreement or any other
agreements, instruments and documents required to be executed in
connection herewith, or the transactions contemplated herein or
therein.

4.4 Corporate Standing. Each of Vail and its
------------------
subsidiaries is a corporation duly organized, validly existing
and in good standing under the laws of the jurisdiction of its
incorporation and has the corporate power and authority to own
its property and assets and to carry on its business in the same
manner as now being conducted. The execution and delivery of
this Agreement, and such other agreements, instruments and
documents required to be executed by Vail in connection herewith,
do not, and the consummation of the transaction contemplated
herein and therein will not, conflict with, or result in any
violation of, breach of or default (with or without notice or
lapse of time or both) under, or give rise to a right of
termination, cancellation or acceleration of any obligation or
the loss of a benefit under, (a) any provision of the Certificate
of Incorporation or bylaws of Vail or any of its subsidiaries, or
(b) except as set forth in Schedule 4.4 hereto, any loan or
credit agreement, note, bond, mortgage, indenture, lease,
contract, agreement, instrument or permit, judgment, order,
decree, writ or injunction to which Vail or any of its
subsidiaries is a party, or by which it or any of its
subsidiaries or its or any of its subsidiaries' properties or
assets are bound, or result in the creation or imposition of any
lien upon any of such properties or assets.

4.5 Qualifications To Do Business. Each of Vail
-----------------------------
and its subsidiaries is duly qualified and in good standing as a
foreign corporation and authorized to do business in each
jurisdiction set forth on Schedule 4.5 hereto. Each of Vail and
its subsidiaries is qualified and in good standing in every

<PAGE> 49

-43-

other jurisdiction in which the ownership of its property or the
conduct of its business requires it to be qualified to do
business, except in those jurisdictions where the failure to be
so qualified would not, individually or in the aggregate, result
in a Material Adverse Change of Vail.

4.6 Capital Stock of Subsidiaries. The only
-----------------------------
direct or indirect subsidiaries of Vail are those listed on
Schedule 4.6 hereto. Except as set forth on Schedule 4.6 hereto,
Vail is directly or indirectly the record and beneficial owner of
all of the outstanding shares of capital stock of each of its
subsidiaries, there are no proxies with respect to such shares,
and no equity securities of any of such subsidiaries are or may
be required to be issued by reason of any options, warrants,
scrip, rights to subscribe for, calls or commitments of any
character whatsoever relating to, or securities or rights
convertible into or exchangeable for, shares of any capital stock
of any such subsidiary, and there are no contracts, commitments,
understandings or arrangements by which any such subsidiary is
bound to issue additional shares of its capital stock or
securities convertible into or exchangeable for such shares.
Other than as set forth on Schedule 4.6 hereto, all of such
shares so owned by Vail are validly issued, fully paid and
nonassessable and are owned by it free and clear of any claim,
lien or encumbrance of any kind with respect thereto. Except as
disclosed on Schedule 4.6 hereto, Vail does not directly or
indirectly own any interest in any corporation, partnership,
joint venture or other business association or entity.

4.7 Corporate Records. True and correct copies of
-----------------
the Certificate of Incorporation and bylaws of Vail have
previously been delivered to Foods.

4.8 Employee Loans and Other Employee Interests in
----------------------------------------------
Vail. Except as set forth on Schedule 4.8, there are no
- - - ----
outstanding loans by or to Vail or any of its subsidiaries to or
from any Vail Employee, other than (a) emergency loans which do
not exceed $10,000 in the aggregate, and none of which exceed
$1,000 individually, (b) housing loans which do not exceed
$10,000 in the aggregate, and none of which exceed $1,000
individually, or (c) ordinary travel advances or (d) employee
charges not exceeding $5,000 individually and $50,000 in the
aggregate. Except as set forth on Schedule 4.8, no Vail Employee
currently employed has any material interest, direct or indirect,
in any lease or contract of Vail.

<PAGE> 50

-44-

4.9 Vail Financial Statements; No Material Adverse
----------------------------------------------
Change. Except as set forth on Schedule 4.9, the Vail
- - - ------
Financial Statements present fairly, in all material respects,
the consolidated financial position and results of operations of
Vail and its subsidiaries as of the dates thereof, all in
conformity with GAAP applied on a consistent basis, except as set
forth in the notes to those financial statements. Since
April 30, 1996, there has not occurred a Material Adverse Change
of Vail, or any event that, individually or in the aggregate,
would reasonably be expected to result in a Material Adverse
Change of Vail. Neither this Section 4.9 nor any other Section
in this Agreement shall be construed as a representation or
warranty as to the accuracy or attainability of budgets or
projections relating to or reflecting the business of Vail.

4.10 Conduct of Business. Except as and to the
-------------------
extent set forth on Schedule 4.10, since April 30, 1996, Vail and
its subsidiaries have not:

(a) made any commitments for capital expenditures or
commitments for additions to property, plant, equipment or
intangible capital assets other than commitments for
$100,000 or less made in the ordinary course of business;

(b) acquired (by merger, consolidation or acquisition
of stock or assets) any corporation, partnership, joint
venture, limited liability company or other business
organization, or division thereof, or entered into any
contract or agreement with respect thereto;

(c) incurred any obligations or liabilities (whether
absolute, accrued, contingent, or otherwise and whether due
or to become due), except for current liabilities incurred
in the ordinary course of business consistent with past
practice; or experienced any change in any assumptions
underlying or methods of calculating any bad debt,
contingency or other reserve;

(d) sold, transferred or conveyed any of its
properties or assets used in Vail's business or operations,
except for current assets sold or converted in the ordinary
course of business and consistent with past practice, or
permitted or allowed any of the properties or assets used in
Vail's business or operations to be mortgaged, pledged or
subjected to any lien or encumbrance, except liens or
encumbrances for taxes not yet delinquent;

<PAGE> 51

-45-

(e) paid, discharged or satisfied any claim, lien,
encumbrance or liability (whether absolute, accrued,
contingent or otherwise and whether due or to become due);

(g) waived any material rights;

(h) granted any increase in the compensation of any
director of Vail or Vail Employee (including, without
limitation, any increase pursuant to any bonus, pension,
profit-sharing or other plan), except for increases (i) made
pursuant to the terms of any existing Employee Benefit Plan,
or (ii) occurring in the ordinary course of business in
accordance with customary practice (for purposes of the
foregoing, ordinary course of business shall be deemed to
include those customary increases granted during ongoing
negotiation of labor agreements);

(i) instituted or adopted any new Employee Benefit
Plan for any director of Vail or any Vail Employee;

(j) directly or indirectly redeemed, purchased or
otherwise acquired or subdivided or reclassified any Vail
Stock;

(k) been involved in any labor dispute, litigation or
governmental investigation of any material nature;

(m) made any amendments to the Certificate of
Incorporation or bylaws of Vail or any of its subsidiaries;
or

(n) agreed, whether in writing or otherwise, to take
any action described in this Section 4.10.

<PAGE> 52

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4.11 Dividends. Since April 30, 1996, Vail has
---------
not declared or paid any dividends on its capital stock in cash,
stock or other property (other than the Vail Dividend).

4.12 Absence of Undisclosed Liabilities. Other
----------------------------------
than as set forth on Schedule 4.12 or as set forth on other
Schedules hereto, or as otherwise included in the April 30, 1996
balance sheet of Vail, there are no liabilities or obligations of
Vail and its subsidiaries of any nature, whether absolute,
accrued, unmatured, contingent or otherwise, that would be
required to be reflected on the liability side of a balance sheet
prepared in accordance with GAAP or disclosed in the notes
thereto, without regard to materiality, other than liabilities
incurred since April 30, 1996 in the ordinary course of business
related to Vail's operations.

4.13 Title to Property. Except as set forth on
-----------------
Schedule 4.13, Vail and its subsidiaries hold fee simple title,
subject only to Permitted Encumbrances, to all of their
respective owned real property, and Vail and its subsidiaries
hold a good and valid leasehold title and estate to all of the
Vail Leased Property, including, without limitation such assets
which are necessary for Vail and its subsidiaries to conduct
their business substantially in the same manner as currently
conducted. None of such owned or leased properties (or such
assets which are necessary for Vail and its subsidiaries to
conduct their business substantially in the same manner as
presently conducted) are subject to any mortgage, deed of trust,
pledge, lien, security interest, conditional sale agreement,
encumbrance, claim, mechanic's or materialmen's lien, or charge
of any kind, except liens shown on Schedule 4.13 as securing
specific liabilities (with respect to which no default, or action
or omission which with the giving of notice or passage of time or
both would constitute a default, exists) and Permitted
Encumbrances.

4.14 Real Property.
-------------

(a) All real property owned or leased (excluding
property leased for employee housing with leases having durations
less than one year or annual rental payments of less than
$20,000) by Vail and its subsidiaries is set forth on Schedule
4.14(a)(i) (the "Vail Leased Property") and such real property is
identified in a manner that reflects the properties which are
owned and those which are leased. Except as set forth on
Schedule 4.14(a)(ii), all buildings and structures required to
operate the business of Vail substantially in the same manner

<PAGE> 53

-47-

as presently conducted located on the real properties owned by Vail
and its subsidiaries and on the Vail Leased Property are in good
operating condition and repair (considering the age of such
buildings and structures and ordinary wear and tear excepted),
and are usable for their current use.

(b) Except as set forth on Schedule 4.14(b), Vail and
its subsidiaries have not received written notice regarding any
of the following (except for matters previously resolved): (x)
any dispute from any contiguous property owners concerning
contiguous boundary lines, (y) that any of the said owned or Vail
Leased Properties (or the buildings, structures or improvements
thereon), or Vail's and its subsidiaries' operations, violate the
zoning or planning laws, ordinances, rules or regulations of the
city, county or state in which they are located, or any building
regulations or codes of such city, county or state, or land use
laws or regulations applicable to said properties, and no such
violations exist, or (z) any claims of others to rights over,
under, across or through any of the owned or Vail Leased
Properties by virtue of use or prescription. Except as set forth
on Schedule 4.14, Vail has or is able to obtain without a
material penalty or material incremental cost, or has a valid
exemption from the requirement to obtain, all governmental
permits (excluding permits from the United States Forest Service
which are covered in Section 4.32), approvals, authorizations or
licenses required to conduct its business in substantially the
same manner as its business is currently conducted.

(c) Vail has previously delivered to Foods or will so
deliver as soon as practicable prior to Closing lists of the most
recently issued real and personal (including vehicles) property
tax assessments and tax bills, if any, for Vail's 1994 and 1995
fiscal years for all property owned or leased by Vail and its
subsidiaries.

(d) Except as set forth on Schedule 4.14(d)(i) all
real properties owned by Vail or its subsidiaries are free from
agreements creating an obligation to sell, lease or grant an
option to sell or lease and (ii) all Vail Leased Property is free
of all agreements creating an obligation to sublease, grant an
assignment of lease or grant an option to sublease.

(e) Except as set forth on Schedule 4.14(e), to the
Knowledge of Vail all real properties owned by Vail and its
subsidiaries and Vail Leased Properties are currently zoned in
the zoning category which permits operation of said properties

<PAGE> 54

-48-

as now used, operated and maintained. To the Knowledge of Vail, the
consummation of the transactions contemplated herein will not
result in a violation of any applicable zoning ordinance or the
termination of any applicable zoning variance now existing.

(f) Schedule 4.14(f) lists all properties owned or
leased by Vail and its subsidiaries which are not presently being
used in the business or operations of Vail and its subsidiaries.

(g) All buildings, structures or improvements owned
and/or leased by Vail and its subsidiaries on any of the owned or
leased real properties are located entirely within the property
boundary lines of such properties and do not materially encroach
onto adjoining lands, and there are no material encroachments of
buildings, structures or improvements from adjoining land onto
such properties.

(h) To the Knowledge of Vail, the developed owned real
properties and the Vail Leased Property currently have access to,
at or within their property boundary lines to all gas, water,
electricity, storm, sewer, sanitary sewer, telephone, and all
other utilities necessary or beneficial to the current operation
of the owned or leased properties, and all of such utilities are
adequate and sufficient for the current operation of such
properties, subject to normal interruptions in the ordinary
course.

(i) Vail and its subsidiaries hold a valid leasehold
estate for each Vail Leased Property, as shown on Schedule
4.14(a)(i), and enjoy peaceful and undisturbed possession
thereunder. All such leases are valid, binding and enforceable
in accordance with their terms, and are in full force and effect,
Vail and its subsidiaries have complied with all material
obligations thereunder, and there are no existing defaults by
Vail and its subsidiaries, and, except as set forth in Schedule
4.14(i), there are no existing defaults by any other party
thereunder. No event has occurred which (whether with or without
notice, lapse of time or the happening or occurrence of any other
event) would constitute a default by Vail and its subsidiaries
and no event has occurred which (whether with or without notice,
lapse of time or the happening or occurrence of any other event)
would constitute a default by any other party thereunder. Except
as disclosed on Schedule 4.14(i), all such leases shall continue
in full force and effect (without default) after the Closing and
the consummation of the

<PAGE> 55

-49-

transactions contemplated by this Agreement without the consent,
approval or act of any other party, except to the extent that
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting the enforcement
of creditors' rights generally or by general equitable or fiduciary
principles.

4.15 Personal Property. Except as set forth on
-----------------
Schedule 4.15(a), and except for any immaterial exceptions,
restrictions or limitations contained in financing statements
with respect to such property, Vail and its subsidiaries own, or
have a valid lease or license with respect to, the tangible
personal property (including without limitation ski lift systems
and snowmaking equipment and systems) which is necessary for the
operation of their business substantially in the same manner as
currently conducted, free and clear of all liens, mortgages,
pledges, security interests, charges or encumbrances other than
Permitted Encumbrances, and enjoy peaceful and undisturbed
possession thereunder. Except as set forth on Schedule 4.15(b),
all such property that is material to the operations of Vail is
in reasonably good operating condition and repair, ordinary wear
and tear excepted, and is suitable for the purposes for which it
is used. Schedule 4.15(c) contains a list of each lease pursuant
to which Vail and its subsidiaries lease personal property which
involves payment over the remaining term of such lease of more
than $100,000 and which in each case is not cancelable upon six
months' notice or less without penalty of more than $100,000.
All such personal property leases are valid, binding and
enforceable in accordance with their terms and are in full force
and effect, Vail and its subsidiaries have complied with all
obligations thereunder and there are no existing material
defaults by Vail and its subsidiaries or, to the Knowledge of
Vail, by any other party thereunder; no event has occurred which
(whether with or without notice, lapse of time or the happening
or occurrence of any other event) would constitute a material
default by Vail and its subsidiaries thereunder; and no event has
occurred which (whether with or without notice, lapse of time or
the happening or occurrence of any other event) would constitute
a material default by any other party thereunder. Except as set
forth on Schedule 4.15(d), all personal property leases which are
set forth on Schedule 4.15(c) hereto shall continue in effect
after the Closing and the consummation of the transactions
contemplated by this Agreement without the consent, approval or
act of any other party. All unperformed contracts to purchase
personal property to which Vail and its

<PAGE> 56

-50-

subsidiaries are a party which provide for a purchase price of
$100,000 or more are set forth on Schedule 4.15(e).

4.16 Litigation and Claims. Schedule 4.16 sets
---------------------
forth all pending judicial or administrative investigations,
lawsuits, actions or proceedings against Vail and its
subsidiaries of which Vail or Vail and its subsidiaries have
received written notice. Except as set forth on Schedule 4.16,
there are no actions, suits, investigations, administrative
proceedings or orders pending or, to Vail's Knowledge, threatened
against (i) Vail, at law or in equity, which, if adversely
determined, would have an adverse effect on the ability of Vail
to perform the terms of this Agreement, or would interfere with
the ability of Vail to consummate the transactions contemplated
herein, or (ii) against Vail or any of its subsidiaries, at law
or in equity.

4.17 Compliance with Laws. Except as set forth on
--------------------
Schedule 4.17, to the Knowledge of Vail, Vail and its
subsidiaries are not in violation of any law, rule or regulation
or in default in any material respect with respect to any
judgment, writ, injunction or decree of any federal, state or
local commission.

4.18 Orders and Consent Decrees. Except as set
--------------------------
forth on Schedule 4.18, or as specifically cross-referenced
thereon from other Schedules hereto, Vail and its subsidiaries
are not a party to, or bound by, any material judicial or
administrative order, judgment, decree or consent decree relating
to any past or present practice, omission, activity or
undertaking. To the Knowledge of Vail, Vail and its subsidiaries
are not in default in any material respect under any of the
judicial or administrative orders, judgments, decrees or consent
decrees or conciliation or compliance agreements set forth on
Schedule 4.18.

4.19 Labor Agreements. There are no binding
----------------
agreements of any type with any labor union, labor organization,
collective bargaining unit or employee group to which Vail and
its subsidiaries are bound.

4.20 Employees. Except as set forth on Schedule
---------
4.20, Vail and its subsidiaries have not received any written
notice from a governmental authority or official during the past
two years of any non-compliance with any federal, state or local
laws, regulations and legal requirements relating to the
employment of labor in connection with their business,

<PAGE> 57

-51-

including those laws, regulations and legal requirements relating
to wages, hours, benefits, affirmative action, equal opportunity,
including the Americans with Disabilities Act and the
Occupational Safety and Health Act, collective bargaining,
workers' compensation and the payment of social security,
unemployment and employment taxes.

4.21 Contracts. All contracts of Vail or any of
---------
its subsidiaries which involve aggregate payments after the date
of this Agreement of $100,000 or more are set forth on Schedule
4.21 or are specifically cross-referenced thereon from other
Schedules hereto. Except as set forth on Schedule 4.21, Vail and
its subsidiaries are not a party to or obligated under any
written agreement or contract that:

(a) provides for the employment of any Corporate
Officer of Vail not terminable at will and without liability
for additional payments or compensation, other than
severance and vacation pay payable in accordance with the
established policies of Vail as set forth on Schedule 4.21;

(b) provides for (i) the employment of any consultant
or broker for a term that would exceed one (1) year from the
date of the Closing, or provides for payments that exceed
$100,000, or (ii) the employment of any independent attorney
or accounting firm not terminable at will;

(c) would prohibit or limit in any material respect
Vail or any of its subsidiaries from engaging in their
present business;

(e) involves the sale of any asset or property of Vail
or any of its subsidiaries presently being used in Vail's or
any of its subsidiaries' business or operations, other than
in the normal course of business;

(f) relates to the borrowing of money or bank credit
(including, but not limited to, indentures, notes,
installment obligations and capital leases) or the

<PAGE> 58

-52-

mortgaging or pledging of any asset or property of Vail or
any of its subsidiaries;

(g) guarantees the obligations of any supplier,
customer or other third party, other than endorsements in
the ordinary course;

(h) is a forward, swap, option or swaption contract or
any other financial instrument with similar characteristics
and/or generally characterized as a "derivative" security to
which Vail or any of its subsidiaries are a party or to
which Vail or any of its subsidiaries or any of their
respective assets or properties is subject or bound
(including, without limitation, funds of Vail invested by
any other person); or

4.22 Validity of Material Contracts.
------------------------------

(a) Except as set forth on Schedule 4.22(a), Vail and
its subsidiaries have not: (i) received any written claim of
breach or default from any party relating to any agreement,
commitment or contract listed on Schedule 4.21; or (ii) received
any written notice of termination from any party relating to any
such agreement, commitment or contract.

(b) Except as set forth on Schedule 4.22(b), Vail and
its subsidiaries have not breached or defaulted in any material
respect on any agreement, commitment or contract listed on
Schedule 4.21.

4.23 Trademarks and Copyrights.
-------------------------

(a) Schedule 4.23(a)(i) lists all registered trade-
marks and copyrights owned by Vail and its subsidiaries and the
jurisdictions in which such are registered or in which an
application has been filed for such registration. Schedule
4.23(a)(ii) lists each license or sublicense (with a term
exceeding one year or with a royalty payment of more than $1,000)
to which Vail and its subsidiaries are a party and pursuant to
which any other person or entity is authorized to use any such
trademark or copyright. All trademarks and copyrights listed on
Schedule 4.23(a)(i) are owned by Vail and its

<PAGE> 59

-53-

subsidiaries and, except as disclosed on Schedule 4.23(a)(iii),
are free and clear of any known adverse claim of any third party.

(b) To the Knowledge of Vail, Vail and its
subsidiaries do not infringe or unlawfully or wrongly use any
trademark or copyright rights owned or claimed by any other
party.

(c) To the Knowledge of Vail, except as disclosed on
Schedule 4.23(c), no third party is now making any infringing use
of any Vail trademark or copyright.

(d) Except as disclosed on Schedule 4.23(d) or as
required to be disclosed on Schedule 4.23(a)(ii), Vail and its
subsidiaries have not sold or otherwise disposed of, or
transferred or granted, any interest in such Vail trademarks or
copyrights listed on Schedule 4.23(a)(i).

(e) To the Knowledge of Vail, no claims are being
asserted by any person against the use of any of the trademarks
or copyrights listed on Schedule 4.23(a)(i), or challenging or
questioning the validity or effectiveness of any license or
agreement related thereto. Except as disclosed on Schedule
4.23(e), none of the Vail trademarks or copyrights is subject to
any outstanding order, judgment or decree restricting the use
thereof by Vail and its subsidiaries, or restricting the
licensing thereof by Vail and its subsidiaries to any other
person or entity.

4.24 Powers of Attorney. Except as set forth on
------------------
Schedule 4.24, neither Vail nor any of its subsidiaries has any
material outstanding revocable or irrevocable Powers of Attorney
or similar authorizations issued to any individual who is not a
Vail Employee.

4.25 Taxes.
-----

(a) Vail, the affiliated group, within the meaning of
Section 1504 of the Code, of which Vail is the common parent and
any other affiliated group, within the meaning of Section 1504 of
the Code, of which Vail has been a member at any time since its
date of incorporation (an "Affiliated Group" and, collectively,
the "Affiliated Groups") have timely filed on or before the date
hereof all Tax Returns required to be filed in accordance with
all applicable laws (taking into account all extensions of due
dates), and all such Tax Returns are true, correct and complete
and all amounts shown thereon as owing

<PAGE> 60

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have been paid. Except as set forth on Schedule 4.25(a): (i)
all Tax bills or Tax assessments received by or with respect to
Vail have been paid (to the extent the Taxes shown thereon are
due and owing); (ii) all Taxes with respect to Vail and the
Affiliated Groups (whether or not shown on any Tax Returns) have
been paid or accrued and all deficiencies for Taxes asserted or
assessed by a taxing authority against Vail or an Affiliated
Group have been paid or finally settled or are being contested by
appropriate proceedings; (iii) no claim is currently being made
by an authority in a jurisdiction where Vail or an Affiliated
Group does not file Tax Returns that it is or may be subject to
taxation by that jurisdiction; and (iv) there are no liens on any
of the assets of Vail or an Affiliated Group that arose in
connection with any failure (or alleged failure) to pay any Tax.
The term "Vail" when used in this Section 4.25 means Vail and its
subsidiaries.

(b) Vail and the Affiliated Groups have collected or
withheld and paid on a timely basis all Taxes required to have
been collected or withheld and paid to any taxing authority in
connection with amounts paid or owing to any employee,
independent contractor, creditor, shareholder or other third
party.

(c) Except as set forth on Schedule 4.25(c), neither
Vail nor an Affiliated Group has received any written notice of
pending or threatened actions, audits, proceedings or
investigations for the assessment or collection of Taxes.

(d) Except as set forth on Schedule 4.25(d), neither
Vail nor an Affiliated Group has waived any statute of
limitations in respect of Taxes or agreed to any extension of
time with respect to a Tax assessment or deficiency (but only to
the extent such waiver or extension is still in effect) nor are
there any outstanding requests for any extension of time within
which to pay any Taxes not yet paid. For all taxable periods
subsequent to the fiscal year ended December 31, 1989, Vail has
provided to Foods (i) true, correct and complete copies of
federal Form 1120 pro forma returns for Vail and all other
information (compiled in a true, correct and complete manner)
relating to income, deductions, credits and Taxes of Vail that is
not included in the pro forma returns, (ii) all statements of
federal Income Tax deficiencies assessed against, or attributable
to, Vail or an Affiliated Group and (iii) a true, correct and
complete copy of any Tax Sharing Agreement to which Vail is a
party and a true, correct and complete description of any such
Tax Sharing Agreement not reduced to writing.

<PAGE> 61

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(e) Except as set forth on Schedule 4.25(e), neither
Vail nor an Affiliated Group has made, is obligated to make or is
a party to any contract, agreement, arrangement or plan covering
any Vail Employee that (taking into account the transactions
contemplated by this Agreement) could obligate it to make any
payments that would not be deductible under Section 162 of the
Code (by reason of being unreasonable in amount), Section 404,
Section 162(m) or Section 280G of the Code.

(f) Schedule 4.25(f) sets forth the following
information with respect to Vail as of the most recent
practicable date: (i) the tax basis of Vail's assets; and
(ii) the amount of any net operating loss, net capital loss, tax
credit or other carryover allocable to Vail.

(g) Except as set forth on Schedule 4.25(g), Vail is
not a party to any joint venture, partnership or other
arrangement or contract that could be treated as a partnership
for federal income tax purposes.

(h) The unpaid Taxes of Vail do not exceed the reserve
for Tax liability as computed in a manner consistent with the
prior and customary accounting practice of Vail (excluding any
reserve for deferred Taxes established to reflect timing
differences between book and tax income).

(i) All Consolidated Returns and Unitary Returns (as
defined below), and all state, local and foreign Tax Returns of
Vail and the Affiliated Groups have been closed by applicable
statute of limitations for all taxable years ending on or before
the dates shown on the attached Schedule 4.25(i). "Consolidated
Return" shall mean any consolidated federal Income Tax Return
filed by an Affiliated Group, and "Unitary Return" shall mean any
Return with respect to any Taxes, other than federal Income
Taxes, filed, or required to be filed, on a consolidated,
combined or unitary basis by any group of corporations of which
Vail is a member or has been a member at any time since its date
of incorporation.

(j) Vail and the Affiliated Groups have made all
payments of estimated Taxes required to be made with respect to
any of them under Section 6655 of the Code and any comparable
provisions of state, local and foreign law.

(k) Except as set forth on Schedule 4.25(k), no power
of attorney has been granted by Vail or an Affiliated

<PAGE> 62

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Group with respect to any matter relating to Taxes which is
currently in force.

(l) No consent has been filed under Section 341(f) of
the Code with respect to Vail or an Affiliated Group.

(m) Neither Vail nor an Affiliated Group has incurred
or assumed any corporate acquisition indebtedness, as defined in
Section 279(b) of the Code.

4.26 Employee Benefit Plans.
----------------------

(a) All Employee Benefit Plans sponsored by Vail and
covering Vail Participants are set forth on Schedule 4.26(a) (the
"Vail Employee Benefit Plans"). With respect to each Vail
Employee Benefit Plan, copies of the following have been
delivered to Foods where applicable: (i) the Plan document;
(ii) a summary plan description; (iii) most recent Annual
Return/Report of Employee Benefit Plan, Form 5500 Series;
(iv) trust agreement; (v) insurance policy; and (vi) deter-
mination letter from the IRS. The Vail Employee Benefit Plans
have in all material respects been maintained and administered in
compliance with applicable federal and state laws, regulations
and rules, including, but not limited to, ERISA and the Code.
All contributions required as of the Closing, by law or contract,
to be made to each Vail Employee Benefit Plan will have been
timely made.

(b) No Vail Employee Benefit Plan (or trust or other
funding vehicle pursuant thereto) is subject to any Tax under
Section 511 of the Code that remains unpaid and assessable
against Vail after the Closing.

(c) Neither Vail nor any plan fiduciary of any Vail
Employee Benefit Plan has engaged in any transaction in violation
of Section 404 or 406 of ERISA, or in any "prohibited
transaction" as defined in Section 4975(c)(1) of the Code, for
which no exemption exists under Section 408 of ERISA, or in
violation of Section 4975(c)(2) or 4975(d) of the Code.

(d) Except as listed on Schedule 4.26(d), neither Vail
nor any Vail Employee Benefit Plan is a party to any litigation
with respect to Vail Participants relating to, or seeking
benefits under, any Employee Benefit Plan.

(e) Except as set forth on Schedule 4.26(e), neither
Vail nor any ERISA Affiliate has any legally binding

<PAGE> 63

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commitments to create any additional Employee Benefit Plans which
are intended to cover Vail Employees, or to amend or modify any
existing Employee Benefit Plan with respect to benefits for Vail
Employees. With respect to each collective bargaining agreement,
there is no legally binding commitment to create any additional
Employee Benefit Plans which are intended to cover Vail
Employees, to amend or modify any existing Employee Benefit Plan
which covers or has covered Vail Employees, or to begin
contributing, or increase contributions, to a Multiemployer Plan,
which would materially increase the benefits to be provided under
such collective bargaining agreement.

(f) Except as described on Schedule 4.26(f), the
execution and performance of the transactions contemplated by
this Agreement, and such other agreements, instruments and
documents required to be executed in connection therewith, shall
not constitute an event under any Employee Benefit Plan or
agreement under which Vail may incur any liability that will
result in any payment (whether severance pay or otherwise),
acceleration, vesting or increase of benefits with respect to any
Vail Employee.

(g) Each Vail Employee Benefit Plan which is a
retirement plan or a savings plan has been established and
operated so as to be qualified and tax exempt under the
provisions of Code Sections 401(a) and 501(a) from its adoption
to date and will be so as of the Closing. Vail has not, by its
action or inaction, adversely affected the qualified status of
any such Vail Employee Benefit Plan.

(h) All Vail Employee Benefit Plans under which
benefits are provided under health maintenance and preferred
provider organizations are set forth on Schedule 4.26(h).

(i) Except as set forth on Schedule 4.26(i), neither
Vail (since January 1, 1989) nor any ERISA Affiliate has been a
party to any Multiemployer Plan in either a "complete withdrawal"
as defined in Section 4203 of ERISA or a "partial withdrawal" as
defined in Section 4205 of ERISA.

(j) Neither Vail nor any of its ERISA Affiliates have
incurred any liability under Title IV of ERISA (other than for
contributions not yet due or for the payment of premiums not yet
due), which liability has not been fully paid as of the date
hereof.

<PAGE> 64

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4.27 Environmental Matters. Except as set forth
---------------------
on Schedule 4.27:

(a) Vail and its subsidiaries have obtained (or are
capable of obtaining without incurring any material
incremental expense) all Environmental Permits and all
licenses and other authorizations and have made all
registrations and given all notifications that are required
under any applicable Environmental Law.

(b) Except as set forth on Schedule 4.27(b), there is
no Environmental Claim pending (excluding any of the
foregoing with respect to which Vail has not received
service of process or notice, as the case may be, except if
Vail has Knowledge of the existence thereof) against Vail
and its subsidiaries under an Environmental Law.

(c) Except as set forth on Schedule 4.27(c) Vail and
its subsidiaries are in compliance with all terms and
conditions of their Environmental Permits, and are in
compliance with all applicable Environmental Laws.

(d) Except as set forth on Schedule 4.27(d) Vail and
its subsidiaries did not generate, treat, store, transport,
discharge, dispose of or release any Hazardous Substances on
any property now or previously owned, leased or used by Vail
and its subsidiaries.

4.28 Liability and Casualty Insurance. Schedule
--------------------------------
4.28 sets forth a description of each liability or casualty
insurance policy (including, without limitation, fire and product
liability policies) including self-insurance maintained on the
property, assets and business of Vail and its subsidiaries,
specifying the insurer, the amount of coverage, the type of
insurance, the policy number, the expiration date and the annual
premium. All such policies: (i) are valid, outstanding and
enforceable policies; (ii) shall remain in full force and effect
until their respective expiration dates as set forth on
Schedule 4.28 without the payment of additional premiums other
than additional premiums required in the ordinary course prior to
the Closing; and (iii) except as noted on Schedule 4.28, shall
not in any way be adversely affected by, or terminate or lapse by
reason of, the transactions contemplated by this Agreement.

<PAGE> 65

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4.29 Consents or Approvals.
---------------------

(b) Except as set forth in Schedule 4.29, no consent,
waiver, approval or authorization, registration, declaration or
filing with any court, administrative agency or commission or
other governmental authority or instrumentality, domestic or
foreign, is required by or with respect to Vail in connection
with the execution and delivery of this Agreement, and such other
agreements, instruments and documents required to be executed by
Vail in connection herewith contemplated herein and therein, or
the consummation by Vail of the transactions contemplated herein
and therein.

4.30 Transaction Fees. Except as set forth on
----------------
Schedule 4.30, neither Vail nor any member of its board of
directors has any agreement or understanding, or has incurred any
liability, requiring the payment of a finder's fee, brokerage
commission or like cost or charge to any person by reason of this
Agreement or the transactions contemplated herein. Vail is
solely responsible for all fees, commissions and other costs of
the persons listed on Schedule 4.30 and neither Vail nor any of
its subsidiaries has any responsibility therefor.

4.31 Ralston Stock Acquired for Vail's Account.
-----------------------------------------
The Ralston Stock to be acquired by Vail pursuant to this
Agreement is being acquired for Vail's own account. Vail has no
intention of distributing or reselling such stock or any part
thereof in any transaction which would be in violation of the
Securities Act of 1933, or the state securities laws of any
state.

4.32 United States Forest Service.
----------------------------

(a) Except as set forth on Schedule 4.32(a), Vail's
operations and those of its subsidiaries comply, in all material
respects with the terms and conditions of the USFS Permits issued
by the USFS to Vail or its subsidiaries and such permits are in
full force and effect and neither Vail nor its subsidiaries have
received any notice of default under the USFS Permits;

<PAGE> 66

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(b) Except as set forth on Schedule 4.32(b), neither
Vail nor its subsidiaries have received any written notice of nor
have any Knowledge that the USFS has any intention of amending,
revoking or otherwise altering the terms or conditions of any of
the USFS Permits, or portion thereof, or the application of the
USFS Permits to Vail's or its subsidiaries' operations;

(c) Except as set forth on Schedule 4.32(c), neither
Vail nor its subsidiaries are engaged in any on-going dispute or
disagreement with the USFS over the interpretation or application
of any term or condition of any of the USFS Permits; and

(d) Except as set forth on Schedule 4.32(d), Vail has
no Knowledge of any third-party permittee or commercial operator
operating within the areas permitted to Vail or its subsidiaries
under any of the USFS Permits.

4.33 Passenger Tramway.
-----------------

(a) Except as set forth on Schedule 4.33(a), neither
Vail nor its subsidiaries have had, in the past three (3) ski
seasons, any passenger tramway incidents that required reporting
to the CPTSB under CPTSB laws, rules, regulations and standards.

(b) Except as set forth on Schedule 4.33(b), each
passenger tramway operated by Vail or its subsidiaries complies
in all material respects with current laws, rules, regulations
and standards of CPTSB and the ANSI and, further, there are no
defects or conditions which are "grandfathered" under CPTSB or
ANSI laws, rules, regulations and standards.

(c) Except as set forth on Schedule 4.33(c), Vail and
its subsidiaries have maintained in all material respects, each
passenger tramway owned or operated by Vail or its subsidiaries
according to all CPTSB laws, rules, regulations and standards and
all maintenance and replacement procedures and standards
recommended by the manufacturer, or manufacturer's successor, of
each such passenger tramway and, further, no such maintenance or
replacement is now outstanding or has been otherwise deferred or
delayed beyond the manufacturer's recommended maintenance and
replacement schedule.

(d) Except as set forth on Schedule 4.33(d), neither
Vail nor its subsidiaries have any Knowledge of any defect or
condition that would preclude or materially limit the normal

<PAGE> 67

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operation of any passenger tramway owned or operated by Vail or
its subsidiaries.

4.34 Clean Water Act.
---------------

(a) To Vail's Knowledge, there have been no material
discharges of dredged or fill material into any waters of the
United States, or any other activity, on or within property owned
or operated by Vail or its subsidiaries in violation of the Clean
Water Act, other than discharges or other activities pursuant to
permits (the "Vail Existing Permits").

(b) Except as described on Schedule 4.34(b), to Vail's
Knowledge, the Vail Existing Permits are in full force and effect
and neither Vail, its subsidiaries nor anyone acting for or on
behalf of Vail or its subsidiaries has materially violated nor is
currently and materially in violation of any of the terms and
conditions of the Vail Existing Permits and there are no
outstanding mitigation requirements or unsatisfied conditions
contained in any of the Vail Existing Permits. Vail represents
that it has all permits required under the Clean Water Act.

4.35 Water Rights. The representations and
------------
warranties set forth on Schedule 4.35 are incorporated herein by
reference.

4.36 Financing Commitment. Vail has obtained a
--------------------
commitment to lend Vail sufficient funds to repay Indebtedness of
Ralston up to the Foods Dividend Amount from Nationsbank of
Texas, N.A. and has provided Foods a true and correct copy of
such commitment. Vail has no Knowledge of any fact or
circumstance that may cause Nationsbank of Texas, N.A. not to
loan such funds to Vail on or prior to the Closing Date.

ARTICLE V

COVENANTS PENDING CLOSING

5.1 Ralston Operations. Until the Closing, Foods
------------------
and Ralston shall use, and shall cause Ralston's subsidiaries to
use, their reasonable best efforts to conduct Ralston's business
in the usual and customary manner consistent with past practice
and exclusively through Ralston and its subsidiaries. Until the
Closing, Ralston shall, and shall cause its

<PAGE> 68

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subsidiaries to, continue to make capital expenditures with respect
to the properties and resorts of Ralston as contemplated by the
Ralston Budget and shall make all expenditures reasonably necessary
(including but not limited to marketing and advertising expenditures
and the hiring of seasonal employees) for the Ralston resorts
opening for the 1996-1997 ski season on a basis consistent with past
practice and in accordance with the Ralston Budget. Except with the
prior written approval of Vail (which approval shall not be
unreasonably withheld) or as specifically permitted by the terms of
this Agreement, Foods shall not permit Ralston to, and Ralston shall
not and shall not permit any of its subsidiaries to:

(a) enter into any employment agreement with any
officer or director, or any agreement to increase the
compensation or benefits of any officer or director (other
than pursuant to normal merit salary reviews conducted in
the ordinary course of business after consultation with
Vail);

(b) increase the compensation or benefits (including,
without limitation, increasing any severance benefits) of
any Ralston Employee except: (i) as required by law;
(ii) in accordance with customary negotiations of applicable
labor or employment agreements to which Ralston or any of
its subsidiaries is bound; (iii) pursuant to any changes in
Employee Benefit Plans as set forth on Schedule 3.30(f); or
(iv) pursuant to normal merit salary reviews conducted in
the ordinary course of business after consultation with
Vail;

(c) make any payment under any existing Employee
Benefit Plan not required under the terms thereof, or
modify, amend or terminate any existing Employee Benefit
Plan (except as required by law) to materially increase the
benefits under such plan, or adopt any new Employee Benefit
Plan;

(d) hire any new Ralston Employee at a grade level of
director or higher (other than replacement employees after
consultation with Vail);

(e) merge with or into another corporation, or become
a partner, shareholder or participant in any joint venture,
limited liability company or other business organization; or
acquire by purchase or otherwise all or any part of the
business or the assets of, or stock or other

<PAGE> 69

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evidence of beneficial ownership in, any firm, corporation
or other person;

(f) acquire or dispose of any material asset (other
than current assets in the ordinary course of business) or
fail to execute all renewal options on any Ralston Leased
Property;

(g) permit any material change in any methods of
calculating any bad debt, or in the assumptions underlying
such calculations;

(h) undertake any obligation or liability (whether
absolute, accrued, contingent or otherwise and whether due
or to become due), except items incurred in the ordinary
course of business and consistent with past practice, or
permit any change in any assumptions underlying or methods
of calculating any bad debt, contingency or other reserves;

(i) permit or allow any of the properties (excluding
the Option Land) or assets used by Ralston or its
subsidiaries in their business or operations (whether real,
personal or mixed, tangible or intangible) to be mortgaged
or pledged, or subjected to a lien, except for Permitted
Encumbrances;

(j) cancel or release any other debts or claims, or
waive any rights of substantial value or sell, transfer or
convey any of its properties or assets (whether real,
personal or mixed, tangible or intangible), except in the
ordinary course of business and consistent with past
practice;

(k) dispose of, or permit to lapse, or otherwise fail
to use reasonable efforts consistent with past practices,
which may or may not include the institution of litigation,
to preserve the rights of Ralston or any of its subsidiaries
to use any material patent, trademark, service mark, logo,
trade dress, trade style, trade name, assumed name or
copyright or any registration or recording thereof or
application therefor;

(l) dispose of, or permit to lapse, any material
license, permit or other form of material authorization; or
dispose of or disclose to any person, other than employees,
consultants and representatives bound by

<PAGE> 70

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confidentiality obligations or agreements, any trade secret,
formula, process or know-how;

(m) make any commitments for capital expenditures for
replacements or additions to property, plant or equipment,
other than as required in the ordinary course of business
consistent with the Ralston Budget or otherwise in the
ordinary course in an aggregate amount not to exceed
$100,000;

(n) declare, pay or make, or set aside for payment or
making, any dividend or other distribution in respect of its
capital stock or other securities (other than as permitted
by Section 2.3 or 5.12 hereof), or directly or indirectly
redeem, purchase or otherwise acquire any of its capital
stock or other securities;

(o) issue, authorize or propose the issuance of any
shares of its capital stock, or subdivide or in any way
reclassify any shares of its capital stock;

(p) delay or defer payment of accounts payable or
other obligations of Ralston or any subsidiary, or
accelerate collection of accounts receivable or other
obligations due Ralston or any subsidiary, in a manner
inconsistent with past practice, or otherwise make any
material change in any method of accounting or accounting
practice;

(q) except pursuant to existing Employee Benefit
Plans, pay, loan or advance any amount to, or sell, transfer
or lease, any property or asset (whether real, personal,
tangible or intangible) to, or enter into agreement,
arrangement or transaction with any of the Corporation
Officers or directors of Ralston;

(r) terminate any material contract, lease, agreement
or license except for contracts, leases, agreements or
licenses expiring in the ordinary course of business
pursuant to their terms, amend or suffer the amendment of,
or fail to perform all of its material obligations under,
any material contract, lease, agreement or license;

(s) enter into any contract, lease, license or permit,
except contracts entered into in the ordinary course of
business;

<PAGE> 71

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(t) fail to take such action as may be reasonably
necessary to maintain, preserve, renew and keep in full
force and effect the corporate existence, qualifications,
material licenses, permits, registrations and franchises of
Ralston and its subsidiaries, or fail to comply with any law
applicable to the conduct of the businesses of Ralston and
its subsidiaries where the failure to comply is reasonably
likely to result in a Material Adverse Change;

(u) amend the certificate of incorporation or by-laws
of Ralston or any of its subsidiaries, or fail to take such
action as may be reasonably necessary to maintain, preserve,
renew and keep in full force and effect the corporate
existence and qualifications of Ralston or any of its
subsidiaries;

(v) incur or become liable with respect to any
Indebtedness that would be required to be repaid as a result
of the transactions contemplated by this Agreement or that
would not be prepayable at any time following the Closing
without premium or penalty;

(w) enter into any agreement with any local, state or
Federal government or agency; or enter into any consulting
agreement or sponsorship agreement requiring the payment of
$100,000 or more or having a term of one year or more;

(x) knowingly take any action that would render any
representation or warranty inaccurate in any material
respect at the time of Closing;

(y) take any action with respect to, or make any
material change in its accounting or Tax policies or
procedures, except as may be required by changes in
generally accepted accounting principles upon the advice of
its independent accountants;

(z) make or revoke any Tax election or settle or
compromise any Tax liability, or amend any Tax Return;

(aa) take any action or fail to take any action which
would constitute a material breach or default under the LLC
Agreement;

<PAGE> 72

-66-

(bb) permit its representatives to the LLC's Management
Committee (as defined in the LLC Agreement) to act upon,
ratify, or approve any Major Decisions (as defined in the
LLC Agreement); or

(cc) dispose of, transfer or assign its interest or any
part thereof in the LLC.

5.2 Vail Operations. Until the Closing, Vail
---------------
shall conduct its business in the usual and customary manner
consistent with past practice and shall continue to make capital
expenditures with respect to its properties and resorts as
contemplated by its 1996 fiscal budget. Except with the prior
written consent of Foods or in furtherance of the transactions
contemplated by this Agreement, Vail shall not:

(a) merge with or into another corporation;

(b) issue, authorize or propose the issuance of any
shares of its capital stock or options to acquire capital
stock other than (i) the issuance of shares of capital stock
issued pursuant to the options listed on Schedule 4.1,
(ii) the issuance of up to 50,000 shares of Vail Stock to
officers and employees of Vail and (iii) the grant or
issuance of options for up to 300,000 shares of Vail Stock
to officers and employees of Vail minus the number of shares
issued pursuant to clause (ii), or subdivide or in any way
reclassify any shares of its capital stock (other than
shares of capital stock issued in connection with Vail's
stock option plan or other existing options);

(d) fail to take such action as may be reasonably
necessary to maintain, preserve, renew and keep in full
force and effect the corporate existence and qualification
of Vail or amend the Certificate of Incorporation or by-laws
of Vail, except as contemplated herein.

In addition to the foregoing, Vail will not take any
action with respect to, or make any material change in its
accounting or Tax policies or procedures, except as may be
required by changes in generally accepted accounting principles
upon the advice of its independent accountants, or make or revoke
any Tax election or settle or compromise any Tax

<PAGE> 73

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liability, or amend any Tax Return, without first consulting with
Foods, it being understood that Vail may undertake such action
after such consultation.

5.3 Due Diligence Review.
--------------------

(a) Until the Closing, each of Ralston and Vail shall
permit each other and their respective counsel, accountants,
financial advisors and other representatives access during normal
business hours to the facilities, personnel and accountants
(including all audit work papers relating solely to Ralston
and/or its subsidiaries) of Ralston and Vail and to all of the
properties, operations, books, contracts and records of Ralston
and Vail to the extent relevant to the transactions contemplated
herein, and shall furnish Ralston and Vail during such period
with all such information concerning the businesses and
operations of Ralston and Vail as Ralston or Vail may reasonably
request, except to the extent that, in the reasonable opinion of
counsel, such furnishing of information would violate or suggest
a violation of any federal, state or local statute, rule,
regulation or ordinance, or any confidentiality agreements with
respect to such information. In furtherance of the foregoing,
promptly following the execution of this Agreement Ralston shall
(i) permit Vail and its representatives to directly communicate
with directors and third party consultants (at Vail's expense to
the extent that the expenses of such consultants as a result of
such communications exceed $10,000) of Ralston and to physically
visit and inspect all of Ralston's resorts and properties,
(ii) provide to Vail all information reasonably requested by Vail
with respect to real estate owned or leased by Ralston and its
subsidiaries and (iii) use its best efforts prior to the Closing
to permit Vail and its representatives to have access to all of
the personnel, properties, books, contracts and records of the
LLC, including attending all meetings between representatives of
Ralston and of the LLC. Vail shall coordinate and schedule any
access to Ralston's and the LLC's facilities and employees
through Joe R. Micheletto and Ingrid Keiser.

(b) In the event of a material change to Ralston's or
Vail's business or operations, Ralston or Vail, as the case may
be, shall notify the other party of such material change and
shall furnish such other party with all information concerning
such change as such other party may reasonably request, except to
the extent that, in the reasonable opinion of counsel, such
furnishing of information would violate or suggest a violation of
any federal, state or local statute, rule,

<PAGE> 74

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regulation or ordinance or any confidentiality agreements with
respect to such information.

5.4 Insurance.
---------

(a) Until the Closing, each of Foods and Vail shall
use their best efforts to maintain, in full force and effect,
liability and casualty insurance policies providing coverage
substantially identical to the insurance coverage provided under
the policies of insurance now in effect for Ralston and Vail and
set forth on Schedules 3.31 and 4.28, respectively. Such party
shall notify the other party in writing in the event of any
cancellation of insurance coverage.

(b) Ralston's insurable interest in the insurance
policies listed in Schedule 3.31 shall terminate (except for the
property policy) at the Closing. Vail shall add Ralston as
additional named insured under Vail's casualties policies
effective as of the Closing. Vail shall assume Ralston's
property policy under an assignment until the expiration of such
policy.

(c) Foods will provide notice in the form of claim
printouts to the respective insurers of "claims made" excess
liability policies.

5.5 Public Announcements. Until the Closing, the
--------------------
parties hereto shall consult with each other and shall mutually
agree upon any press release or public announcement relating to
the transactions contemplated herein and will not issue any such
press release or make any such public announcements prior to such
consultation and agreement, except as may be required by
applicable law or by obligations pursuant to any listing
agreement with any national securities exchange, or that counsel
deems any party should make to the investing public and its
shareholders, provided that the party proposing to issue such
press release or make such public announcement will use
reasonable efforts to consult in good faith with the other
parties before issuing any such press release or making any such
public announcement.

5.6 Hart-Scott-Rodino Filing; Investigations or
-------------------------------------------
Litigation. Foods and Vail shall (i) take all action
- - - ----------
necessary, as soon as reasonably practicable, to make the filings
required of Foods and Vail under Hart-Scott-Rodino, (ii) endeavor
to obtain early termination of the waiting period thereunder,
(iii) promptly comply with any request for

<PAGE> 75

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additional information received by Foods or Vail from the Federal
Trade Commission or the Antitrust Division of the Department of
Justice pursuant to Hart-Scott-Rodino, (iv) use reasonable
efforts to defend all lawsuits, other legal proceedings, or
investigations challenging this Agreement or the transactions
contemplated hereby (unless in the reasonable opinion of Vail,
they are unlikely to prevail in such matter), and (v) attempt to
lift or rescind any injunction or restraining order or other
order adversely affecting the ability of the parties to
consummate the transactions contemplated hereby (unless in the
reasonable opinion of Vail, they are unlikely to prevail in such
matter). Without limiting the foregoing, each party will
cooperate with the other parties in connection with any filings
required under Hart-Scott-Rodino, including (i) furnishing to
other parties, upon request, such information as shall reasonably
be required in connection with the preparation of the parties'
filings under Hart-Scott-Rodino, and (ii) with respect to the
transactions contemplated by the Agreement, coordinating
responses and establishing reasonable schedules and deadlines in
connection with resolving any investigation, other inquiry, or
legal proceedings commenced by the Federal Trade Commission, the
Antitrust Division of the Department of Justice or any state
attorney general.

5.7 No Solicitation. Unless and until this
---------------
Agreement is terminated pursuant to Article XI, Foods and Ralston
shall not, and shall not permit any of their Corporate Officers
or directors to, (a) furnish any information concerning the
businesses of Ralston to any person (other than Vail) interested
in acquiring Ralston or, except in the ordinary course of
business, any of its assets, or (b) solicit any offer or enter
into discussions or negotiations with respect to any merger or
sale of all or substantially all of the assets of Ralston, or
other acquisition transaction with respect to Ralston, with any
persons other than Vail. Foods shall notify Vail promptly upon
the receipt of any such inquiry, contact or offer.

5.8 Audit of Ralston Financial Statements; Delivery
-----------------------------------------------
of Additional Financial Statements.
- - - ----------------------------------

(a) Promptly following the execution of this
Agreement, Foods, at its expense, shall cause its independent
public accountants to audit the Ralston Financial Statements
(including the interim period ending June 30, 1996) and cause
such audit to be completed prior to August 31, 1996, together
with the delivery of such accountants' audit report with respect
thereto. Foods shall permit Vail and its accountants to have

<PAGE> 76

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access to the auditors conducting such audit as well as their
work papers related thereto. Foods understands and agrees that
such audited statements, together with other relevant information
concerning Ralston and its business, will be included in a
registration statement for the sale of Vail Common Stock in a
registered public offering.

(b) Until the Closing, Foods shall deliver to Vail
interim consolidated financial statements of Ralston as soon as
practicable, but in no event later than forty-five (45) days
after the end of each fiscal quarter, consisting of a balance
sheet dated as of the last day of such fiscal quarter and related
statements of income and cash flow for such current and
comparative prior year and fiscal quarter, prepared in accordance
with GAAP and consistent with past practices, and thereafter such
statements shall be considered Ralston Financial Statements
hereunder.

(c) To the extent not included within the Ralston
Financial Statements, Foods and Vail shall deliver to each other
within twenty (20) days after the period to which they relate
unaudited monthly financial statements, including a consolidated
balance sheet and consolidated statements of earnings and cash
flow for the period then ended.

(d) Until the Closing, Vail shall make available to
Foods interim consolidated financial statements of Vail, as soon
a practicable but in no event later than forty-five (45) days
after the end of each fiscal quarter, consisting of a balance
sheet dated as of the last day of such fiscal quarter, and
related statements of income, shareholders' equity and cash flow
of such fiscal quarter, prepared in accordance with GAAP and
consistent with past practices, and thereafter such statements
shall be considered Vail Financial Statements hereunder. In the
event any such fiscal quarter shall be the last quarter of the
fiscal year, such statements shall be audited by independent
public accountants.

5.9 Supplemental Disclosure. Until the Closing,
-----------------------
Foods and Vail shall have the continuing obligation to promptly
supplement the information contained in the Schedules attached
hereto with respect to any matter hereafter discovered which was
in existence on the date hereof and, if known at the date of this
Agreement, would have been required to be set forth or described
in the Schedules.

<PAGE> 77

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5.10 Real Property Transfer Laws. Foods and
---------------------------
Ralston shall comply with any real property transfer laws that
may be triggered by this transaction and Foods and Vail shall
equally pay any and all taxes, if any, thereunder.

5.11 Cooperation. Prior to the Closing, the
-----------
parties shall cooperate in preparing, and proceed with due
diligence and in good faith in filing, any and all registration
statements, filings, and other documents necessary to consummate
the transactions contemplated by this Agreement.

5.12 Foods Receivables and Payables. Immediately
------------------------------
prior to the Closing, (i) all amounts then owing by Foods or any
affiliate of Foods to Ralston or any of its subsidiaries shall be
forgiven and extinguished and (ii) all amounts then owing to
Foods or any affiliate of Foods from Ralston or any of its
subsidiaries shall be contributed to Ralston's capital and
extinguished.

5.13 Environmental Surveys. In order to assist in
---------------------
arranging the financing necessary for the Closing, promptly
following the execution of this Agreement Vail, in consultation
with Foods, shall retain, at Vail's expense, a reputable
environmental consulting firm reasonably acceptable to Foods to
conduct a Phase I Environmental Assessment and Compliance Audit
of such of the properties of Ralston and its subsidiaries as Vail
shall determine and, if recommended by such firm, Phase II
investigation of such properties. Foods, in consultation with
Vail, at its expense may have similar surveys done with respect
to such of the properties of Vail and its subsidiaries as Foods
shall determine.

5.14 Affiliate Guarantors. In the event that
--------------------
Foods at any time Transfers (as defined in the Shareholders
Agreement) any Vail Stock to an Affiliate of Foods, prior to
making such Transfer Foods shall cause such Affiliate to execute
and deliver to Vail a guaranty of such Affiliate, in form and in
substance satisfactory to Vail, whereby such Affiliate shall
unconditionally guaranty all of Foods' obligations to Vail under
Article X hereunder.

5.15 Notice of Certain Transactions. From the
------------------------------
date of execution of this Agreement until such time as Foods no
longer has any liability under Article X hereunder, Foods shall
give Vail 20 days' prior written notice before taking any of the
following actions: (i) the distribution to shareholders of
Foods' indebtedness or of any substantial or material portion

<PAGE> 78

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of the assets of Foods and its subsidiaries, taken as a whole (other
than cash dividends paid in the ordinary course); (ii) any
consolidation or merger of Foods with or into another entity or
any sale of all or any substantial portion of the assets of Foods
and its subsidiaries taken as a whole; or (iii) the voluntary
dissolution, liquidation or winding up of Foods.

5.16 Guarantee Fees. Subject to Vail complying
--------------
with Section 10.2(d), Foods hereby promptly agrees to pay over to
Vail any and all fees, commissions or other amounts that Foods or
any of its Affiliates may receive on or after the Closing Date
with respect to any Indebtedness of Ralston or its subsidiaries
for which Foods or any of its Affiliates remains liable for (as
guarantor or otherwise) after the Closing.

ARTICLE VI

CONDITIONS TO CLOSING

6.1 Conditions of Vail. The obligation of Vail to
------------------
close the transactions contemplated herein is subject to the
following conditions:

(a) performance of all covenants, obligations and
agreements of Foods in all material respects contained in
this Agreement required to be performed at or prior to the
Closing;

(b) the representations and warranties of Foods
contained in this Agreement shall be true and correct in all
material respects as of the date hereof and remain true and
correct in all material respects on the date of the Closing
as if such representations and warranties are being made as
of the date of the Closing;

(c) the execution and delivery by Foods of all
documents required to be delivered by this Agreement at or
prior to the Closing, including without limitation the
Shareholder Agreement;

(d) there shall not have occurred since June 30, 1996
a Material Adverse Change of Ralston, or any event that,
individually or in the aggregate, could reasonably

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be expected to result in a Material Adverse Change of Ralston;

(e) Vail shall have received the audited Ralston
Financial Statements contemplated by Section 5.8(a) and
there shall be no differences between such audited
statements and the unaudited Ralston Financial Statements
which are material;

(f) Vail shall have arranged sufficient financing
sources, on terms satisfactory to Vail, to repay all
Indebtedness of Ralston and its subsidiaries in full on the
Closing Date, and the Indebtedness relating to the
Conference Center shall be amended to the reasonable
satisfaction of Vail;

(g) the aggregate amount reflected in the Ralston
Budget to have been spent on capital expenditures from
July 1, 1996 through the end of the month immediately
preceding the Closing Date shall not be more than $3,000,000
in excess of the aggregate amount of capital expenditures
actually made by Resorts and its subsidiaries from July 1,
1996 through the end of the month immediately preceding the
Closing Date;

(h) Vail shall have received consents and estoppel
certificates with respect to the transactions contemplated
by this Agreement from the LLC and the estate of Harry L.
Baum;

(i) all requisite consents and approvals from the
United States Forest Service with respect to the
transactions contemplated by this Agreement shall have been
received by Ralston;

(j) there shall exist no material defaults by Ralston
or any of its subsidiaries on any of the contracts or
agreements relating to the Ventures and there shall have
been no change in the percentage ownership of the Ventures
of Ralston from that which exists as of the date of this
Agreement; and

(k) Vail shall have received a certificate of an
officer of Foods setting forth Foods' estimate in good faith
of the amount determined pursuant to clause (A) in the
definition of Closing Contribution Adjustment and such
amount shall not exceed $18,000,000.

<PAGE> 80

-74-

Vail may waive any condition to the Closing; provided, however,
that such waiver shall not act as a waiver of any of Vail's
available rights or remedies against Foods pursuant to Article X
hereof.

6.2 Conditions of Foods. The obligation of Foods
-------------------
to close the transactions contemplated herein is subject to the
following conditions:

(a) performance of all covenants, obligations and
agreements of Vail contained in this Agreement required to
be performed at or prior to the Closing;

(b) the representations and warranties of Vail
contained in this Agreement shall be true and correct in all
material respects as of the date hereof and remain true and
correct in all material respects on the date of the Closing
(other than the representations and warranties set forth in
Section 4.10) as if such representations and warranties are
being made as of the date of the Closing;

(c) the execution and delivery by Vail and Apollo Ski
Partners, L.P. of all documents required to be delivered by
this Agreement at or prior to the Closing, including without
limitation the Shareholder Agreement; and

(d) there shall not have occurred since April 30, 1996
a Material Adverse Change of Vail, or any event that,
individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Change of Vail.

Foods may waive any condition to the Closing; provided, however,
that such waiver shall not act as a waiver of any of Foods'
available rights or remedies against Vail pursuant to Article X
hereof.

6.3 Hart-Scott-Rodino. No party is obligated to
-----------------
close (a) until the applicable waiting period (as may be
extended) under Hart-Scott-Rodino shall have expired or been
terminated by the appropriate governmental agency, or (b) if any
challenge or objection has been made to the transactions
contemplated herein by such governmental agency unless any such
challenge or objection made has been withdrawn or resolved to the
satisfaction of Vail in its sole discretion.

6.4 No Litigation. The obligation of Foods and
-------------
Vail to close the transactions contemplated herein is subject to the

<PAGE> 81

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condition that, upon Closing, there shall exist no bona fide
lawsuit or other legal action (or any administrative proceeding
or investigation) by any governmental authority that challenges
or seeks to enjoin or modify the transactions contemplated
herein, or any other lawsuit, action, proceeding or investigation
which, in Vail's reasonable opinion, could materially interfere
with the consummation of the transactions contemplated by this
Agreement.

6.5 Material Change in Market Circumstances.
---------------------------------------
There shall not have occurred any material adverse change in the
financial markets in the United States or any other calamity or
crisis, the effect of which has resulted in a material adverse
effect on the market in the United States for equity securities
in general.

ARTICLE VII

THE CLOSING

7.1 Place of Closing. The Closing will be held at
----------------
such place as shall be mutually agreed upon by the parties.

7.2 Date of Closing. The Closing shall occur on
---------------
the Closing Date; provided, however, if the conditions contained
herein have not been met or waived by December 31, 1996, this
Agreement shall terminate.

7.3 Effective Time of Closing. The Closing shall
-------------------------
be deemed effective at 11:59 p.m., Denver time, on the date of
Closing.

7.4 Delivery of Closing Documents. All matters at
-----------------------------
the Closing shall be considered to take place simultaneously, and
no delivery of any document shall be deemed complete until all
documents are delivered and all transactions contemplated herein
are completed.

<PAGE> 82

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ARTICLE VIII

CLOSING TRANSACTIONS

8.1 Transfer of Ralston Stock. At the Closing,
-------------------------
Foods shall deliver to Vail stock certificate(s) representing
that whole number of the issued and outstanding shares of Ralston
Stock, duly and validly endorsed in blank by Foods for transfer,
or accompanied by duly and validly executed stock powers, with
all necessary stock transfer or other documentary stamps attached
and any other documents that are necessary to transfer legal
valid title.

8.2 Delivery of Vail Stock. As consideration for
----------------------
the purchase of the Ralston Stock, Vail will deliver to Foods, or
its nominee, 3,777,203 shares of Vail Stock.

8.3 Receipt. At the Closing, after receipt of the
-------
Vail Stock, Foods shall deliver to Vail an appropriate receipt
for the Vail Stock.

8.4 Opinion of Counsel of Foods. At the Closing,
---------------------------
Foods shall deliver to Vail an Opinion of Counsel from counsel
for Foods, dated as of the Closing, to the effect that:

(a) Foods is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Missouri; and Ralston is a corporation duly organized,
validly existing and in good standing under the laws of the
State of Colorado;

(b) Ralston and each of its subsidiaries have the
corporate power and authority to own their properties and
assets and carry on their business, and are duly qualified
and in good standing as a foreign corporation in each
jurisdiction set forth in Schedule 3.8 hereto;

(c) Foods (through a wholly owned subsidiary) is the
record and beneficial owner of all of the issued and
outstanding Ralston Stock, and the Ralston Stock
certificate(s) or stock powers that have been duly executed
and delivered by Foods transfer all rights to such stock to
Vail, or its nominee, free and clear of any and all liens,
encumbrances or rights of any other party;

<PAGE> 83

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(d) Foods has taken all action required by its
Articles of Incorporation and its by-laws, and Ralston has
taken all action required by its Articles of Incorporation
and by-laws, to authorize the execution and delivery of this
Agreement and such other agreements, instruments and
documents required to be executed in connection herewith;

(e) Foods and Ralston have the corporate power and
authority to execute and deliver this Agreement and, when
executed and delivered, this Agreement, and such other
agreements, instruments and documents required to be
executed in connection herewith, constitute legal, valid and
binding obligations of Foods and Ralston, enforceable in
accordance with their terms, except that enforcement may be
limited by bankruptcy, insolvency, moratorium or other
similar laws affecting the enforcement of creditors' rights
generally and general principles of equity;

(f) The execution and delivery of this Agreement, and
such other agreements, instruments and documents required to
be executed in connection herewith, and the consummation of
the transactions contemplated herein and therein, do not
conflict with any provision of the Articles of Incorporation
or by-laws of Foods or conflict with any provision of the
Certificates of Incorporation or by-laws of Foods or Ralston
or any of Ralston's subsidiaries;

(g) The authorized and outstanding capital stock of
Ralston consists solely of 100 shares of Ralston Stock, with
all 100 shares owned of record and beneficially by Foods;
all outstanding shares of Ralston Stock are duly authorized,
validly issued, fully paid and non-assessable, and there are
no other shares of capital stock or other securities of
Ralston outstanding;

(h) Neither the execution or delivery of this
Agreement, and such other agreements, instruments and
documents required to be executed in connection herewith,
nor the consummation of the transactions contemplated herein
and therein, to the knowledge of counsel: (i) violates any
statute, law, rule or regulation, or any order, award,
judgment or decree of any court or governmental authority
affecting Ralston or any of its subsidiaries or Foods;
(ii) causes (with or without notice, the passage of time or
both) the maturity of any debt, liability or obligations of
Ralston or any of its subsidiaries or Foods to be
accelerated, or increases or will increase any such

<PAGE> 84

-78-

liability or obligation; or (iii) requires any filing with,
the notification of, or the obtaining of any authorization,
consent or approval of, any federal or state governmental or
regulatory authority, other than filings under
Hart-Scott-Rodino and the approval of the U.S. Forest
Service, and licenses and permits as may be necessary for
Ralston or any of its subsidiaries to carry on its business
subsequent to the Closing;

(i) Except as set forth in Schedule 3.19 of this
Agreement, to the best knowledge of counsel, there does not
exist any action, proceeding or investigation pending or
threatened in writing against Foods or Ralston or any of its
subsidiaries attempting to enjoin this Agreement or the
transactions contemplated by this Agreement, and such other
agreements, instruments and documents required to be
executed in connection herewith; and

(j) Ralston is not (i) an "investment company" as
defined in, or subject to regulation under, the Investment
Company Act of 1940, or (ii) a "holding company" as defined
in, or subject to regulation under, the Public Utility
Company Act of 1935.

8.5 Opinion of Counsel of Vail. At the Closing,
--------------------------
Vail shall deliver to Foods an Opinion of Counsel from counsel
for Vail (which opinion may be made by Vail's in-house counsel),
with such counsel relying on opinions of other counsel and such
certificates of Corporate Officers of Vail as he or she deems
appropriate, dated as of the Closing, to the effect that:

(a) Vail is a corporation validly existing and in good
standing under the laws of the State of Delaware;

(b) Vail has the corporate power and authority to own
its properties and carry on its businesses as presently
conducted;

(c) Vail has taken all action required by its
Certificate of Incorporation and by-laws to authorize the
execution and delivery of this Agreement, and such other
agreements, instruments and documents required to be
executed in accordance herewith;

(d) Vail has the corporate power and authority to
execute and deliver this Agreement and, when executed and

<PAGE> 85

-79-

delivered, this Agreement, and such other agreements,
instruments and documents required to be executed in
connection herewith, constitute legal, valid and binding
obligations of Vail, enforceable in accordance with their
terms, except that enforcement may be limited by bankruptcy,
insolvency, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and general
principles of equity;

(e) The execution and delivery of this Agreement, and
such other agreements, instruments and documents required to
be executed in connection herewith, and the consummation of
the transactions contemplated herein and therein, do not
conflict with any provision of the Certificate of
Incorporation or by-laws of Vail;

(f) Neither the execution or delivery of this
Agreement, and such other agreements, instruments and
documents required to be executed in connection herewith,
nor the consummation of the transactions contemplated herein
and therein, to the knowledge of counsel: (i) violates any
statute, law, rule or regulation, or any order, award,
judgment or decree of any court or governmental authority
affecting Vail; (ii) violates or conflicts with, or
constitutes a default under any provision of, any contract,
agreement or trust to which Vail is a party, or by which
Vail's assets are bound; (iii) causes (with or without
notice, the passage of time or both) the maturity of any
debt, liability or obligation of Vail to be accelerated, or
increases or will increase any such liability or obligation;
or (iv) requires any filing with, the notification of, or
the obtaining of any authorization, consent or approval of
any federal governmental or regulatory authority, other than
filings under Hart-Scott-Rodino;

(g) The authorized capital stock of Vail consists
solely of 25,000,000 shares of preferred stock, 20,000,000
shares of Class A Common Stock and 40,000,000 shares of
Common Stock; the Vail Stock issued to Foods pursuant to
this Agreement has been duly authorized and is validly
issued, fully paid and non-assessable; and

(h) To counsel's knowledge, there does not exist any
action, proceeding or investigation pending or threatened
against Vail attempting to enjoin this Agreement or the
transactions contemplated by this Agreement, and such

<PAGE> 86

-80-

other agreements, instruments and documents required to be
executed in connection herewith.

8.6 Good Standing Certificates. At the Closing,
--------------------------
Foods shall deliver to Vail a Certificate of Good Standing for
each of Foods and Ralston from the Secretary of State of their
respective state of incorporation, dated not more than fifteen
(15) days prior to the Closing, with bring-down certificates as
of the date of the Closing if available from the applicable
Secretary of State; and Vail shall deliver to Foods Certificates
of Good Standing for Vail from the Secretary of State for the
State of Delaware, dated not more than fifteen (15) days prior to
the Closing, with bring-down certificates as of the date of the
Closing.

8.7 Corporate Resolutions of Foods. At the
------------------------------
Closing, Foods shall deliver to Vail (x) a copy of the
resolutions adopted by the Board of Directors of Foods (or its
Executive Committee), and a copy of the resolutions adopted by
the Board of Directors of Foods, authorizing the execution and
delivery of this Agreement and the consummation of the
transactions contemplated herein, duly certified to as of the
Closing by the appropriate corporate secretary or assistant
secretary and (y) the original corporate minute books and stock
transfer records of Ralston.

8.8 Corporate Resolutions of Vail. At the
-----------------------------
Closing, Vail shall deliver to Foods a copy of the resolutions
adopted by the Board of Directors of Vail (or its Executive
Committee), and a copy of the resolutions adopted by the Board of
Directors of Vail, authorizing the execution and delivery of this
Agreement and the consummation of the transactions contemplated
herein, duly certified to as of the Closing by the appropriate
corporate secretary or assistant secretary.

8.9 Certificate of Foods. At the Closing, Foods
--------------------
shall deliver to Vail certificates signed by a corporate officer
of Foods, on behalf of Foods, dated as of the Closing, certifying
(i) as to the truth and accuracy of the representations and
warranties made by Foods in this Agreement, and reaffirming and
remaking such representations and warranties of Foods as of the
Closing and (ii) that Foods has performed and complied in all
material respects with all covenants and agreements required by
this Agreement to be performed or complied with by it on or prior
to the Closing Date.

<PAGE> 87

-81-

8.10 Certificate of Vail. At the Closing, Vail
-------------------
shall deliver to Foods certificates, signed by a senior officer
of Vail, on behalf of Vail, dated as of the Closing, certifying
(i) as to the truth and accuracy of the representations and
warranties made by Vail in this Agreement, and reaffirming and
remaking such representations and warranties of Vail as of the
Closing and (ii) that Vail has performed and complied in all
material respects with all covenants and agreements required by
this Agreement to be performed or complied with by it on or prior
to the Closing Date.

8.11 Shareholder Agreement. At the Closing,
---------------------
Foods, Vail and Apollo Ski Partners, L.P. shall execute and
deliver the Shareholder Agreement.

8.12 Resignation of Ralston Corporate Officers.
-----------------------------------------
At the Closing, Foods shall deliver to Vail the executed
resignation, dated as of the date of the Closing and effective
immediately prior to the Closing, for all of the members of the
board of directors of Ralston and each of its subsidiaries and,
to the extent requested by Vail, of the officers of Ralston and
each of its subsidiaries.

8.13 Consents. At the Closing, Foods and Ralston
--------
shall deliver to Vail any consents from third parties required
for the execution, delivery and performance of this Agreement,
and such other agreements, instruments and documents required to
be executed in connection herewith, and the consummation of the
transactions contemplated herein and therein.

8.14 Ancillary Documents. At the Closing, Foods
-------------------
shall deliver to Vail all assignments, sublicenses, bills of sale
or other instruments, in form acceptable to Vail, as may be
necessary or reasonably requested by Vail in order to effectively
sell, convey, transfer and assign to Ralston good and marketable
title to all assets used in Ralston's business or operations.

ARTICLE IX

ADDITIONAL COVENANTS

9.1 Commissions and Fees. Each party hereto shall
--------------------
pay any and all finder's fees, brokerage commissions or like

<PAGE> 88

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costs or charges to be paid by reason of the transactions
contemplated herein that may have been incurred by such party.

9.2 Costs and Expenses. Foods shall pay its own
------------------
and Ralston's costs and expenses, including fees of attorneys,
accountants and financial advisors, necessary in the preparation
of this Agreement, and such other agreements, instruments and
documents required to be executed in connection herewith, and the
consummation of the transactions contemplated herein and therein.
Vail shall pay its own costs and expenses, including fees of
attorneys, accountants and financial advisors, necessary in the
preparation of this Agreement, and such other agreements,
instruments and documents required to be executed in connection
herewith, and the consummation of the transactions contemplated
herein and therein. Notwithstanding the foregoing, Foods and
Vail shall each pay one-half of the fees of an economist jointly
selected by them for Hart-Scott-Rodino purposes.

9.3 Bank Accounts.
-------------

(a) Until the Closing, Foods shall continue to employ
cash management practices consistent with those employed
immediately prior to the date of this Agreement, including:

(i) continuing to collect funds generated from the
business or operations of Ralston from bank accounts and
bank lock boxes of Foods or Ralston and through Foods'
standard depository transfer system; and

(ii) continuing to fund the bank accounts of Foods or
Ralston in connection with cash disbursements related to the
business or operations of Ralston.

(b) All collection and concentration bank accounts
used in Ralston's business (and all cash and checks therein)
shall remain the property of Foods after Closing. All
disbursement accounts used in Resort's business shall remain the
property of Foods at Closing. All uncleared checks, drafts or
other withdrawal instruments written on such disbursements
accounts prior to closing ("Uncleared Ralston Checks") shall be
the responsibility of Foods after Closing. Foods will assist
Ralston in establishing its own bank accounts so that Ralston
will be able to write checks, drafts or other withdrawal
instruments for its own account immediately after Closing.

<PAGE> 89

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9.4 Business Relationships. Within five (5)
----------------------
Business Days after the Closing, Vail or Ralston shall notify all
banking institutions used by Ralston that Ralston has been
acquired by Vail. In addition, Vail or Ralston and Foods shall
notify, in writing or by publication, the customers and suppliers
of Ralston that Ralston has been acquired by Vail, and that the
payment of any account receivable shall be paid directly to
Ralston.

9.5 Insurance Proceeds.
------------------

(a) In the event Foods receives any amount of
insurance proceeds (other than self-insurance and insurance
related to Employee Benefit Plans, lost profits or business
interruptions) in connection with any insurance policy providing
coverage for the properties and assets of Ralston for claims
arising after the date hereof, Foods shall promptly notify Vail
of the receipt of such proceeds, and with respect to amounts
received prior to the Closing, shall retain and deliver the
aggregate amount of such insurance proceeds, net of any amount of
such proceeds used to replace or repair any properties or assets
or claims paid by Foods prior to the Closing, to Vail at the
Closing, and shall promptly deliver to Vail any such additional
proceeds received after the Closing.

(b) In the event Foods, subsequent to the Closing,
receives any amount of insurance proceeds (other than
self-insurance and insurance related to Employee Benefit Plans,
lost profits or business interruption) in connection with any
insurance policy providing coverage for the properties and assets
of Ralston (including any proceeds received under any general
liability, workers' compensation or excess coverage policy), then
Foods shall promptly deliver all of such proceeds to Vail,
without any set-off, reduction or hold back whatsoever.

9.6 Further Action. Subsequent to the Closing,
--------------
Foods, Vail and Ralston shall each take such further action as
may be reasonably requested by the other in order to carry out
the terms of this Agreement, and such other agreements,
instruments and documents required to be executed in connection
herewith, and consummate the transactions contemplated herein and
therein. The parties shall, on request, cooperate with one
another by furnishing any additional information, executing and
delivering any additional documents and instruments, including
contract assignments, bills of sale and third party consents, and
doing any and all such other things as may be reasonably required
by the parties or their counsel.

<PAGE> 90

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9.7 Records. Subsequent to the Closing, Vail and
-------
Foods shall provide, or cause to be provided, to each other and
each other's representatives, reasonable access (for the purpose
of examining and copying during normal business hours) to the
books and records of Ralston and Foods (insofar as they relate to
Ralston), including, but not limited to, accounting and Tax
records and Tax Returns, sales and purchase documents, notes,
memoranda, test records and any other electronic or written data
("Records") pertaining to periods or occurrences prior to the
Closing. Unless otherwise consented to in writing by the other,
the parties shall not, for a period of seven (7) years following
the Closing, destroy, alter or otherwise dispose of any of the
books and records of Ralston or Foods (insofar as they relate to
Ralston) pertaining or relating to periods prior to the Closing
and, notwithstanding any other provision of this Section 9.7, no
party to this Agreement shall destroy, alter or otherwise dispose
of any tax or accounting records of Ralston or Foods (insofar as
they relate to Ralston) without the written consent of all other
parties to this Agreement.

9.8 Employee Benefit Plan Matters.
-----------------------------

(a) Vail's Obligations. Effective on the Closing
------------------
Date, Vail, Ralston or one of their subsidiaries shall become the
employer of Ralston Employees excluding those Ralston Employees
whose employment has terminated prior to the Closing Date and
excluding those Ralston Employees on leave due to, or in a
waiting period prior to, a finding of total or long-term
disability pursuant to any Ralston Employee Benefit Plan that
provides disability benefits (for purposes hereof, Ralston
Employees, other than those excluded in this Section 9.8, shall
be referred to as "Active Ralston Employee(s)").

(b) Retention of Retirement Plans. As between the
-----------------------------
parties hereto, Ralcorp shall retain the assets and sponsorship
of the Ralcorp Holdings, Inc. Savings Investment Plan, the
Ralston Resorts, Inc. Savings Investment Plan (together the
"Savings Plans"), and the Ralcorp Holdings, Inc. Retirement Plan
(the "Retirement Plan") as applicable to employees or former
employees of Ralston and its subsidiaries, and shall retain the
obligations for providing any benefits accrued by such employees
or former employees under such plans. Ralcorp shall take such
actions as may be necessary to cause the Savings Plans and the
Retirement Plan to provide that benefits accrued under such plans
on or prior to the Closing Date by the Active Ralston Employees
shall be fully vested as of the

<PAGE> 91

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Closing Date. Effective on the Closing Date, Ralston and its
subsidiaries shall no longer participate in the Savings Plans or
the Retirement Plan.

(c) Defined Contribution Plans. The parties agree
--------------------------
that pursuant to the terms of the Savings Plans, whichever is
applicable, Ralston will distribute to the Active Ralston
Employees or retain in the Savings Plans vested benefits accrued
by the Active Ralston Employees in the Savings Plans. If
requested by Vail, Ralcorp shall distribute cash and participant
loans from the Savings Plans to participants who are Active
Ralston Employees in "direct rollover distributions" (as
described in Section 401(a)(31) of the Code).

(d) Defined Benefit Plan. For purposes of
--------------------
determining the amount of benefits payable under the Retirement
Plan, (i) the compensation of each Active Ralston Employee shall
only include compensation considered compensation pursuant to the
Retirement Plan and paid or payable to such Active Ralston
Employees by Ralston or Foods or their affiliates for services
prior to and including the Closing Date and shall not include
compensation paid or payable to Active Ralston Employees by Vail
for services after the Closing Date; and (ii) the period of
service shall be determined pursuant to the Retirement Plan and
shall only include the time prior to and including the Closing
Date during which such Active Ralston Employee provided services
to Ralston or Foods or their affiliates and shall not include any
period of time after the Closing Date during which services were
provided by such Active Ralston Employee to Vail. Whether Active
Ralston Employees shall be fully vested in benefits they have
accrued as of the Closing shall be determined pursuant to the
Retirement Plan provisions regarding vesting.

(e) Severance. With respect to Active Ralston
---------
Employees who are terminated by Vail or Ralston on or after the
Closing Date, Vail shall be responsible for severance benefits
payable pursuant to severance plans, policies and practices
applicable to Active Ralston Employees at the time of their
termination; provided, that Vail shall not be responsible for,
and Foods shall indemnify and hold harmless Vail from, any
severance claims or obligations due to any Active Ralston
Employee under any contractual or other agreement other than the
severance benefits payable under Ralston's general severance
benefits program set forth in Schedule 3.29(g)(2). Vail further
agrees to provide any required notice under the WARN Act for any
termination of Active Ralston Employees by Vail on or after the
Closing Date.

<PAGE> 92

-86-

(f) Vacation. Vail agrees, after the Closing
--------
Date, to credit each Active Ralston Employee with vacation
benefits which accrued but have not yet been taken, provided,
however, that requested or scheduled vacations are subject to
Vail's business needs; provided further, however,
-------- ------- -------
that Vail shall be required to credit vacation carried forward
from previous periods only to the extent reflected on the Ralston
balance sheet as of the Closing Date.

(g) Employee Related Obligations. (1) Except as
----------------------------
may be provided in this Section (g), Ralston shall retain all
liabilities for all obligations to the employees or former
employees of Ralston and its subsidiaries derived from Employee
Benefit Plans offered to such employees or former employees by
Ralston or Foods or its affiliates which arise (medical and
dental expenses arise when the employee is provided with medical
and dental care) at any time out of their employment by Ralston
on or immediately before the Closing Date.

(2) Except as otherwise specifically provided
herein, Vail is not obligated to provide any particular benefits
to the Active Ralston Employees after closing, and may change any
benefit program in the future, including plans and programs
applicable to the Active Ralston Employees. Further, no
agreement between the parties hereto nor any action by Vail or
Foods or its affiliates shall be deemed to create any third-party
beneficiary rights in any employees of Vail or Foods or any
affiliate of either. Prior to the Closing, Vail will provide
Foods with evidence, reasonably satisfactory to Foods, that Vail
has in place, effective as of the Closing, a health benefit
program for Active Ralston Employees that provides substantially
comparable benefits to the health benefit program provided by
Foods or its affiliates, and which does not exclude preexisting
conditions. After the Closing, Vail shall be responsible for
such coverage.

(h) On and after the Closing Date, Vail shall be
responsible for employee-related liabilities and obligations,
with respect to the Active Ralston Employees, under any employee
benefit plan and any other plans, practice and programs of Vail
which may be offered to Active Ralston Employees.

9.9 Confidentiality Agreement. The
-------------------------
Confidentiality Agreement shall remain in full force and effect
until the Closing and (x) if the Closing occurs, only the
Confidentiality and Exclusivity Agreement dated May 16, 1996
between Ralcorp Holdings, Inc. and Apollo Advisors, L.P. shall
remain in full force

<PAGE> 93

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and effect other than paragraphs 7, 8, or 9 of such agreement,
and (y) if the Closing does not occur and this Agreement is
terminated pursuant to Article XI, the Confidentiality Agreement
shall continue in accordance with its terms.

9.10 Tax Election. Vail shall not make a Section
------------
338(h)(10) election under Section 338 of the Code with respect to
the acquisition of the Ralston Stock or the operations of
Ralston.

9.11 Resale of Ralston Stock. Foods shall not
-----------------------
offer, sell or distribute the shares of Vail Stock received in
this transaction except in accordance with the terms and
conditions of the Shareholder Agreement.

9.12 Non-Competition.
---------------

(a) For a period beginning on the date hereof and
ending five (5) years hereafter, Foods agrees that it will not,
and it will cause any entity that Foods through one or more
intermediaries, directly or indirectly controls or is controlled
by ("Foods Affiliates"), not to, within North America, directly
or indirectly, individually or as a member of any business
organization, engage in the ownership or operation of any ski
resort business or facility or have any interest in any entity
engaged in the ownership or operation of any ski resort business
or facility; provided, that nothing set forth in this paragraph
shall prevent Foods or a Foods Affiliate from at any time owning
shares issued by a publicly traded corporation, including without
limitation one that engages in some or all of the activities
described in this paragraph (in which activities Foods or such
Foods Affiliate will not participate); provided, further, that at
no time will Foods' or a Foods Affiliate's ownership in any such
corporation exceed five percent (5%) of the voting stock (other
than the capital stock of Vail if such ownership is in accordance
with the terms of the Shareholder Agreement) as may from time to
time be issued by and outstanding from each such publicly traded
corporation.

(b) Foods agrees that any breach of the covenants
contained in this Section 9.12 would cause irreparable harm to
Vail and Ralston and, therefore, notwithstanding any right of
Vail and Ralston to recover monetary damages with respect to any
such breach as set forth in this Section 9.12 or at law, Vail and
Ralston will be entitled to equitable relief to enjoin any
threatened or continuing breach hereof. If the scope of any
restriction contained in this Section 9.12 is too broad to

<PAGE> 94

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permit enforcement to its full extent, then such restriction
shall be enforced to the maximum extent permitted by law.
Nothing herein stated shall be construed as prohibiting any party
from pursuing any other remedies available to that party for a
breach hereunder, including recovery of damages.

ARTICLE X

INDEMNIFICATION

10.1 Indemnification of Vail. Foods shall
-----------------------
indemnify and hereby hold harmless Vail and, after the Closing,
Ralston and their nominees, affiliates, officers, directors,
employees and agents against any Loss, in full as such Loss is
incurred, suffered as a result of: (a) any breach of any
representation or warranty made by Foods in this Agreement or in
any other document, instrument or agreement entered into in
connection herewith; (b) any breach of any covenant made by
Foods, Ralston or Ralcorp in this Agreement or in any other
document, instrument or agreement entered into in connection
herewith; and (c) any breach of the Confidentiality Agreement
made by Foods in favor of Vail; provided, that such
--------
indemnification obligation shall only arise with respect to
Losses suffered or incurred as a result of any breach of any
representation or warranty to the extent such Losses (which,
individually, must be at least $25,000) in the aggregate exceed
$1,000,000.

10.2 Indemnification of Foods. Vail and, after
------------------------
the Closing, Ralston, jointly and severally, shall indemnify and
hold Foods, and its nominees, affiliates, officers, directors,
employees and agents, harmless against any Loss, in full as such
Loss is incurred, suffered as a result of: (a) any breach of any
representation or warranty made by Vail in this Agreement; (b)
any breach of any covenant made by Vail or, after the Closing,
Ralston in this Agreement; (c) any breach of the Confidentiality
Agreement made by Apollo Advisors L.P. in favor of Foods; and
(d) Ralston or Vail failing to pay when due any and all amounts
due arising under Indebtedness of Ralston or its subsidiaries
existing at the Closing Date and for which Foods or any of its
Affiliates remains liable for (as guarantor or otherwise) after
the Closing; provided, that such indemnification obligation
--------
shall only arise with respect to Losses suffered or incurred as a
result of any breach of any representation or warranty to the
extent such Losses (which,

<PAGE> 95

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individually, must be at least $25,000) in the aggregate exceed
$1,000,000.

10.3 Indemnification Procedure. Upon obtaining
-------------------------
knowledge of a Loss which shall entitle an injured party to
indemnification hereunder, the injured party shall deliver a
Notice of Claim to the indemnifying party. The Notice of Claim
shall state in reasonable detail the nature and estimated amount
of any such Loss giving rise to the right of indemnification
hereunder. The indemnifying party shall have thirty (30)
Business Days after receipt of the Notice of Claim to indemnify
the injured party, whether or not it disputes its liability or
the amount thereof, and to set forth the basis for any objection.
If the indemnifying party fails to respond to the injured party
within such thirty (30) Business Days, the indemnifying party
shall be deemed to have acknowledged its responsibility for such
Loss, and in such event, or if the indemnifying party does not
dispute its liability, then the indemnifying party shall pay and
discharge any such Loss which is not contested within sixty (60)
days after receipt of the Notice of Claim.

10.4 Third Party Claims. If any party believes it
------------------
may suffer a Loss that should entitle such party to
indemnification under this Agreement because of a lawsuit, claim
or other action by a third party, such injured party shall
deliver a Notice of Claim to the party required to indemnify.
Within thirty (30) days after receiving a Notice of Claim, the
indemnifying party may: (a) acknowledge its liability and elect
to assume the defense of the third party claim at its sole cost
and expense; or (b) dispute its liability in the Notice of Claim.
Any contest of a third party claim in which the indemnifying
party assumes such defense shall be conducted by attorneys
employed by the indemnifying party; provided that the injured
party shall have the right to participate with its own attorneys
and at its own cost and expense. Such indemnifying party may
agree to any settlement it deems in its best interest, but shall
not settle any action where the settlement includes an injunction
or other order affecting the injured party without the prior
approval of the injured party, which shall not be unreasonably
withheld. If the indemnifying party does not assume the defense
of the third party claim as provided for herein, the injured
party shall have the right to defend such claim and effectuate
any settlement thereof it deems appropriate, and within fifteen
(15) Business Days of any final resolution, the indemnifying
party shall pay the injured party any Loss the injured party
suffered. If the indemnifying

<PAGE> 96

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party is defending any third party action in good faith, its
obligation to pay the indemnified party with respect to the
defended matter shall be suspended until the matter has been
finally adjudicated or settled.

10.5 Tax Indemnification.
-------------------

(a) Notwithstanding any other provisions of this
Agreement to the contrary, Foods shall be liable for and shall
indemnify Vail and its affiliates and hold them harmless for,
from and against (i) all liability for Taxes of Ralston and any
of its subsidiaries (except as provided in Section 10.5(d) and
the immediately following paragraph) for all taxable periods
ending on or before the Closing Date and the portion of any
Straddle Period ending on and including the Closing Date (the
"Pre-Closing Tax Periods"), including, without limitation, any
liability for Taxes imposed upon Ralston pursuant to Treasury
Regulation " 1.1502-6 (and any comparable provision under
applicable state or local law) as a result of being a member of
any Affiliated Group or any combined or unitary group, and (ii)
any liability for Taxes attributable to a breach by Foods of its
obligations under this Agreement.

(b) Vail shall indemnify Foods and its affiliates and
hold them harmless for, from and against all liability for Taxes
of Ralston for any taxable period ending after the Closing Date
(except to the extent such taxable period began before the
Closing Date, in which case Vail's indemnity will, other than for
Taxes described in Section 10.5(a)(ii), cover only that portion
of any such Taxes that are not for the Pre-Closing Tax Period).

(c) In the case of any taxable period that includes
(but does not end on) the Closing Date (a "Straddle Period"), the
Taxes of Ralston for the Pre-Closing Tax Period shall be computed
as if such taxable period ended on and included the Closing Date.

(d) Foods shall not be liable for and shall not
indemnify Vail and its affiliates for, from and against all
liability for Taxes, other than Income Taxes, for the Pre-Closing
Period (i) payment of which on a timely basis would be made with
an original Tax Return filed by Ralston after the Closing Date
and (ii) computation thereof is made in a manner consistent with
the prior and customary accounting practice of Ralston.

<PAGE> 97

-91-

10.6 Limitation of Indemnification.
-----------------------------

(a) The aggregate amount of all claims subject to
indemnification under Sections 10.1(a), (b) and (c) with respect
to indemnification of Vail shall be $185,000,000 and Sections
10.2(a), (b) and (c) with respect to indemnification of Foods
shall be $185,000,000 except (x) in the case of any Loss caused
by the indemnifying party's violation of law, bad faith, fraud or
intentional misconduct, for which liability shall not be subject
to such limit and (y) in the case of clause (d) of Section 10.2,
for which there shall be no limit.

(b) The sole remedy of the parties hereto for any Loss
against them or their directors, officers, employees, agents,
representatives, affiliates, shareholders or subsidiaries related
to or arising from in whatsoever manner this Agreement and the
other documents executed in contemplation of this Agreement is
the indemnification and other remedies specifically provided
herein (and therein with respect to such other documents).
Therefore, no directors, officers, employees, agents,
representatives, affiliates, shareholders or subsidiaries shall
incur individual liability for matters arising hereunder except
to the extent that an Affiliate of Foods becomes a guarantor
pursuant to Section 5.14.

(c) An indemnifying party shall not be liable under
Section 10.1 or 10.2, as the case may be, for a loss resulting
from any event relating to the other party's breach, falsity,
inaccuracy, incompleteness, misrepresentation or nonfulfillment
of a representation.

10.7 Procedures Relating to Indemnification of Tax Claims.
----------------------------------------------------

(a) If any taxing authority provides written notice of
any claim, demand or circumstance which, if successful, might
result in any indemnity payment pursuant to Section 10.5, the
party seeking indemnification (the "Tax Indemnified Party") shall
promptly notify the other party (the "Tax Indemnifying Party") in
writing of such claim (the "Tax Claim"). If notice of a Tax
Claim ("Tax Notice") is not given to the Tax Indemnifying Party
within a reasonably sufficient period of time to allow such Tax
Indemnifying Party effectively to contest such Tax Claim, such
Tax Indemnifying Party shall not be liable to the Tax Indemnified
Party or any of its affiliates to the extent that such Tax
Indemnifying Party's position is actually prejudiced as a result
thereof.

<PAGE> 98

-92-

(b) With respect to any Tax Claim for any taxable
period ending on or prior to the Closing Date which might result
in an indemnity payment to Vail pursuant to Section 10.5, Foods,
within 30 days of receiving written notice of such Tax Claim, may
in its sole discretion elect to control all proceedings taken in
connection with such Tax Claim and, without limiting the
foregoing, may in its sole discretion and at its sole expense
pursue or forgo any and all administrative appeals, proceedings,
hearings and conferences with any taxing authority with respect
thereto, and may, in its sole discretion, either pay the Tax
claimed and sue for a refund where applicable law permits such
refund suits or contest such Tax Claim in any permissible manner
and in any forum permitted by law. In the event that Foods fails
to provide Vail with written notice of Foods' election to contest
such Tax Claim within such 30 day period, Foods shall forfeit any
right to control the contest of such Tax Claim. In no case shall
Vail or Ralston settle or otherwise compromise any Tax Claim
referred to in the immediately preceding sentence without Foods'
prior written consent, which consent shall not be unreasonably
withheld. Vail, Ralston and each of their affiliates shall
cooperate with Foods in contesting any Tax Claim that Foods
elects to contest, which cooperation shall include, without
limitation, the reasonable retention and (upon Foods' request)
the provision to Foods of records and information which are
reasonably relevant to such Tax Claim, for which Foods shall
reimburse Vail and Ralston for their out-of-pocket expenses
incurred in connection therewith.

(c) The contest of any Tax Claim that relates to (i)
taxable periods ending after the Closing Date and (ii) any Tax
Claim that Foods does not elect to control pursuant to Section
10.7(b), shall be controlled by Vail, and Foods agrees and agrees
to cause its affiliates to cooperate with Vail and its affiliates
in pursuing such contest.

(d) Notwithstanding the provisions of Section 10.7(b)
above, with respect to any Tax Claim that Foods elects to
control, Foods may not settle, compromise or otherwise dispose of
the Tax Claim without first notifying Vail of Foods' proposal for
settling, compromising or disposing of the Tax Claim;
provided, however, that this Section 10.7(d) shall apply
- - - -------- -------
only if such settlement, compromise or other disposition could
adversely affect the tax liability of Vail or Ralston. After
Foods has provided Vail with such written notice, Foods and Vail
shall cooperate as to how the Tax Claim will be handled,
answered, defended, compromised or settled, and Foods shall not

<PAGE> 99

-93-

settle, compromise or otherwise dispose of the Tax Claim until
Foods and Vail have mutually agreed to the manner of such
settlement, compromise or disposition.

10.8 Survival of Representations and Warranties.
------------------------------------------
The representations and warranties by Foods in Article III (with
the exception of those representations and warranties by Foods in
Section 3.28 of this Agreement), and by Vail in Article IV (with
the exception of those representations and warranties by Vail in
Section 4.25 of this Agreement), and in any other document,
certificate, instrument or agreement executed in connection
hereunder unless explicitly provided otherwise in such document,
certificate, instrument or agreement, shall survive for a period
of two (2) years following Closing and thereafter to the extent a
claim is made prior to such expiration. The representations and
warranties by Foods in Section 3.28 of this Agreement and by Vail
in Section 4.25 of this Agreement shall survive as to any Tax
covered by such representations and warranties for so long as any
statute of limitations for such Tax remains open, in whole or in
part, including, without limitation, by reason of waiver of such
statute of limitations. No party shall be entitled to
indemnification for breach of any representation and warranty set
forth in Articles III and IV of this Agreement and in any other
document, certificate, instrument or agreement executed in
connection hereunder unless explicitly provided otherwise in such
document, certificate, instrument or agreement unless a Notice of
Claim for such breach has been given to the breaching party or
parties prior to the termination of the period of survival of
such representation and warranty as set forth herein.

10.9 Survival of Indemnities. The obligations of
-----------------------
each party to indemnify another party for a Loss arising under
this Agreement shall survive the sale or other transfer by a
party of any asset or liability transferred, assumed or retained
pursuant to this Agreement.

10.10 Transfer Taxes. Notwithstanding any other
--------------
provisions of this Agreement to the contrary, Vail and Foods
shall equally pay all sales, use, stock transfer, stamp, duties,
recording, real property transfer, gains and similar taxes, if
any, required to be paid in connection with the transactions
contemplated by this Agreement, it being agreed that none of such
payments shall be borne directly or indirectly by Ralston or
Vail.

<PAGE> 100

-94-

10.11 Return Filings, Refunds and Credits.
-----------------------------------

(a) Except as noted in the immediately following
sentence, Ralcorp shall prepare or cause to be prepared and file
or cause to be filed on a timely basis (in each case, at its own
cost and expense and in a manner consistent with past practice)
all Tax Returns with respect to Ralston and with respect to an
Affiliated Group for taxable periods ending on or prior to the
Closing Date. Ralcorp agrees that Ralston shall sign and file
all Tax Returns prepared solely on behalf of Ralston and its
subsidiaries. For purposes of this Section 10.11(a), Affiliated
Group shall mean only such group of which Ralcorp is the common
parent. Ralcorp shall provide Vail with copies of all Returns
that Ralcorp prepares or causes to be prepared and filed and with
originals of all Returns that Ralston will sign and file.
Ralcorp shall pay or cause to be paid all Taxes shown on all such
Tax Returns, whether filed by Ralcorp or by Ralston. Ralcorp
further agrees that Vail shall have a reasonable opportunity to
review and comment upon any Tax Return prior to Ralcorp's filing
of such Tax Return that could affect the Tax liability of Vail or
Ralston.

(b) Vail shall prepare or cause to be prepared and
shall file or cause to be filed on a timely basis all other Tax
Returns with respect to Ralston. In connection therewith, Foods
shall be responsible for and shall pay any Taxes for which Foods
has agreed to indemnify Vail pursuant to Section 10.5. Vail
shall provide Foods with copies of any such Tax Returns covering
the Taxes described in Section 10.5 at least ten days prior to
the due date thereof (giving effect to any extensions thereto),
accompanied by a statement calculating Foods' indemnification
obligation pursuant to Section 10.5. Foods shall pay to Vail the
amount of Foods' indemnification obligation at least two business
days prior to the due date thereof (giving effect to any
extensions thereto) unless the parties are unable to agree on the
amount of Foods' indemnification obligation hereunder, in which
case Foods shall promptly pay the portion of the indemnification
that is not in dispute and the disputed portion shall be resolved
by independent accountants acceptable to both parties whose fees
and expenses shall be paid by Vail and Foods in proportion to
each party's respective liability for Taxes as determined by such
accountants, and Foods shall pay the amount determined by such
accountants within two days of such determination, together with
interest thereon from the original due date thereof to the date
of payment at a rate equal to 10% per annum.

<PAGE> 101

-95-

(c) Foods and Vail shall reasonably cooperate, and
shall cause their respective affiliates, officers, employees,
agents, auditors and representatives reasonably to cooperate, in
preparing and filing all Tax Returns (including amendments
thereto and claims for refund), including maintaining and making
available to each other all records necessary in connection with
Taxes and in resolving all disputes and audits with respect to
all taxable periods relating to Taxes.

(d) Any refunds or credits of Taxes of Ralston for any
taxable period ending on or before the Closing Date, except as
described in Section 10.12, shall be for the account of Foods and
shall be paid by Vail to Foods within ten days after Vail
receives such refund. Any refunds or credits of Taxes of Ralston
for any taxable period beginning after the Closing Date shall be
for the account of Vail and shall be paid by Foods to Vail within
ten days after Foods receives such refund. Any refunds or
credits of Taxes of Ralston for any Straddle Period shall be
allocated between Foods and Vail on the basis of an "interim
closing of the books."

10.12 Refunds from Carrybacks. If Ralcorp becomes
-----------------------
entitled to a refund or credit of Taxes for any period for which
Foods is liable under Section 10.5(a) to indemnify Vail and such
Taxes are attributable solely to the carryback of losses, credits
of similar items from a taxable year or period that begins after
the Closing Date and attributable to Ralston, Foods shall cause
Ralcorp to pay to Vail within ten days after Ralcorp receives
such refund or credit the amount of such refund or credit
together with any interest received thereon.

10.13 Termination of Tax Sharing Agreements.
-------------------------------------
Foods hereby agrees and covenants that any obligation of Ralston
pursuant to any agreements or arrangements relating to the
allocation or sharing of Taxes (the "Tax Sharing Agreements")
shall be terminated on or before the Closing Date, and no
payments pursuant to any such Tax Sharing Agreement shall be made
after such termination.

10.14 Payments. Unless otherwise required by law,
--------
the parties shall treat any payments made pursuant to this
Article X as an adjustment to the amount of the purchase price
paid to Foods pursuant to Section 2.2 for federal, state and
local income tax purposes.

<PAGE> 102

-96-

ARTICLE XI

TERMINATION

11.1 Mutual Consent. This Agreement may be
--------------
terminated at any time before the Closing by the mutual consent
of Foods and Vail.

11.2 Obligation To Close. This Agreement may be
-------------------
terminated by any party upon giving written notice to the other
parties, if a condition to the notifying party's obligation to
close pursuant to Article VI of this Agreement becomes incapable
of satisfaction other than as a result of the notifying party's
breach of its obligations hereunder.

11.3 Final Closing Date. This Agreement will
------------------
terminate if the Closing has not taken place on or before Decem-
ber 31, 1996.

11.4 Obligations After Termination. Upon any
-----------------------------
termination of this Agreement, the parties shall be released from
all obligations or liabilities arising hereunder except for: (i)
liabilities arising from or out of pre-termination breaches
hereunder; (ii) liabilities arising out of the failure or refusal
of a party to consummate the Closing if all conditions precedent
have been met or waived; and (iii) obligations arising out of
Sections 9.1, 9.2 and 9.9 of this Agreement.

ARTICLE XII

MISCELLANEOUS PROVISIONS

12.1 Entire Agreement. This Agreement, including
----------------
the attached Schedules and Exhibits, constitutes the entire
agreement between the parties hereto relative to the subject
matter hereof, and supersedes all prior written or oral
understandings, agreements, conditions, representations or
warranties.

12.2 Effect of Supplemental Information. Pursuant
----------------------------------
to Section 5.9 hereof, the parties have the obligation to
supplement their respective Schedules with additional information
which is discovered between the date hereof and the Closing which
should have been disclosed on the Schedules hereto.

<PAGE> 103

-97-

Neither the supplementation of the Schedules pursuant to such
obligation nor any disclosure after the date hereof of the
untruth of any representation and warranty made in this Agreement
shall operate as a cure of any breach involving (a) the failure
to disclose the information or (b) any untrue representation or
warranty made herein. Notwithstanding the foregoing, if such
supplementation (i) is consented to in writing by both parties,
(ii) with respect to a supplementation by Vail, discloses any
fact or set of facts which, either singly or in the aggregate
with other facts disclosed in the Schedules, does not, or is not
reasonably likely to, result in a Material Adverse Change of Vail
or (iii) with respect to a supplementation by Foods, does not, or
is not reasonably likely to, result in additional liability for
Vail in an amount in excess of $100,000 in the aggregate with all
other supplemental information, such supplementation shall be
deemed to cure any such untrue representation or warranty, and
such representation or warranty, as supplemented, shall be deemed
to have been amended accordingly.

12.3 Choice of Law. This Agreement shall be
-------------
construed under and in accordance with the laws of the State of
Colorado without giving effect to the conflict of laws provisions
thereof.

12.4 Venue. Any action or legal proceedings to
-----
enforce this Agreement or any of its terms, or for
indemnification and the recovery of any Loss by a party, shall be
brought and prosecuted exclusively in such court or courts
located in the State of Colorado as provided by law, and the
parties to this Agreement consent to the jurisdiction of said
court or courts and to service of process by registered mail,
return receipt requested, or in any other manner provided by
Colorado law.

12.5 Notices. Any notice or other communication
-------
required or permitted hereunder shall be deemed sufficiently
given if sent by registered or certified mail, return receipt
requested, and addressed as follows (the address for any party
may be changed by giving notice thereof to the other parties):

<PAGE> 104

-98-

If to Foods:

Ralston Foods, Inc.
800 Market Street
Suite 2900
St. Louis, Missouri 63101

Attn.: Robert Lockwood, Esq.
Facsimile No.: (314) 877-7748

If to Ralston (prior to Closing):

Ralston Foods, Inc.
800 Market Street
Suite 2900
St. Louis, Missouri 63101

Attn.: Robert Lockwood, Esq.
Facsimile No.: (314) 877-7748

If to Vail or Ralston (after the Closing):

Vail Resorts, Inc. (Delivery other than by
mail)
137 Benchmark Road
Avon, Colorado 81620

Vail Resorts, Inc. (Mail Delivery)
P.O. Box 7
Vail, Colorado 81658

Attn.: James S. Mandel, Esq.
Facsimile No.: (970) 845-2521

With a copy to:

James J. Clark, Esq.
Cahill Gordon & Reindel
80 Pine Street
New York, NY 10005

Facsimile No.: (212) 269-5420

12.6 Effective Date of Notice. Any notice or
------------------------
communication shall be deemed to have been given on the next

<PAGE> 105

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Business Day if sent by Federal Express or a similar overnight
delivery service, or on the third Business Day if sent by
ordinary U.S. mail service.

12.7 Amendments. No changes, modifications,
----------
amendments or additions shall be valid unless made in writing and
signed by or on behalf of each party.

12.8 Gender and Number. Where appropriate in this
-----------------
Agreement, the masculine pronoun shall include the feminine or
neuter, and the singular shall include the plural.

12.9 Assignments. No party hereto may assign this
-----------
Agreement or any rights or obligations hereunder except to the
extent that written authorization for such assignment is given by
the other parties prior to such assignment.

12.10 Headings and Captions. All headings and
---------------------
captions used in the Table of Contents and all section, Schedule
and Exhibit headings and captions used in this Agreement are for
convenience only, and shall not be construed to either limit or
broaden the language of this Agreement or any particular section.

12.11 Schedules and Exhibits. The inclusion of
----------------------
any information in any Schedule or Exhibit attached hereto shall
not be deemed to be an admission or acknowledgment that such
information is material to the transaction, or represents matters
that are outside the ordinary course of business. The Schedules
and Exhibits attached hereto are incorporated herein by reference
and are made a part hereof for all purposes.

12.12 Severability. The invalidity or
------------
unenforceability of any provision hereof in any jurisdiction
shall not affect the validity or enforceability of the remainder
hereof in that jurisdiction or the validity or enforceability of
this Agreement, including that provision, in any other
jurisdiction. To the extent permitted by applicable law, each
party waives any provision of law that renders any provision
hereof prohibited or unenforceable in any respect. If any
provision of this Agreement is held to be unenforceable for any
reason, it shall be adjusted rather than voided, if possible, in
order to achieve the intent of the parties to the extent
possible.

12.13 Counterparts. This Agreement may be
------------
executed simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which together
shall

<PAGE> 106

-100-

constitute a single agreement, and it shall not be necessary in
making proof of this Agreement to produce or account for more
than one such counterpart.

12.14 Remedies. Any forbearance or failure or
--------
delay in exercising any remedy hereunder shall not be deemed to
be a waiver of any other remedy a party may be entitled to under
this Agreement.

12.15 Third-Party Beneficiaries. This Agreement
-------------------------
is not intended to confer upon any non-party any rights or
remedies hereunder. Any representation or warranty made by Foods
in this Agreement is made to Vail alone, and solely for the
purposes of selling the Ralston Stock, and Foods has not made and
makes no representation or warranty to any person other than
Vail. Any representation or warranty made by Vail in this
Agreement is made to Foods alone, and solely for the purpose of
purchasing the Ralston Stock, and Vail has not made and makes no
representation or warranty to any person other than Foods.

12.16 Binding Agreement. This Agreement shall be
-----------------
deemed effective and legally binding upon the parties when it has
been executed and delivered by all parties hereto. This
Agreement shall inure to the benefit of the parties hereto and
their respective successors and assignees.

<PAGE> 107
IN WITNESS WHEREOF, the parties have executed this
Agreement by an officer thereunto duly authorized, all as of the
day and year first above written.

RALSTON FOODS, INC.

By: /s/ J.R. Micheletto
-----------------------------------
Name: J.R. Micheletto
Title: Vice President and Chief
Financial Officer

RALSTON RESORTS, INC.

By: /s/ J.R. Micheletto
-----------------------------------
Name: J.R. Micheletto
Title: President

VAIL RESORTS, INC.

By: /s/ Andrew P. Daly
-----------------------------------
Name: Andrew P. Daly
Title: President

RALCORP HOLDINGS, INC. (as to
Sections 9.8, 10.11 and 10.12
only)

By: /s/ J.R. Micheletto
-----------------------------------
Name: J.R. Micheletto
Title: Chief Executive Officer and
Chief Financial Officer

<PAGE> 108
Exhibit A

SHAREHOLDER AGREEMENT

Among

VAIL RESORTS, INC.

RALSTON FOODS, INC.

AND

APOLLO SKI PARTNERS, L.P.

----------, 1996

<PAGE> 109
<TABLE>
TABLE OF CONTENTS
-----------------
<CAPTION>

Page
----
<S> <C>
ARTICLE I - DEFINITIONS. . . . . . . . . . . . . . . . . . . 1

ARTICLE II - STANDSTILL AND VOTING PROVISIONS . . . . . . . 6
Section 2.1. Standstill Covenants . . . . . . . . . . 6
Section 2.2. Acquisition of Vail Securities . . . . . 8
Section 2.3. Voting of Vail Equity . . . . . . . . . 9
Section 2.4. Restrictions on Certain Transactions
Prior to IPO . . . . . . . . . . . . . 10

ARTICLE III - TRANSFER OF VAIL EQUITY . . . . . . . . . . . 10
Section 3.1. Restrictions on Transfer . . . . . . . . 10
Section 3.2. Exceptions to Restrictions . . . . . . . 10
Section 3.3. Improper Transfer . . . . . . . . . . . 11
Section 3.4. Restrictive Legend . . . . . . . . . . . 12

ARTICLE IV - RIGHT OF FIRST OFFER . . . . . . . . . . . . . 13
Section 4.1. Sales by Foods . . . . . . . . . . . . . 13

ARTICLE V - REGISTRATION . . . . . . . . . . . . . . . . . . 14
Section 5.1. Demand Registration . . . . . . . . . . 14
Section 5.2. Delay of Demand Registration . . . . . . 16
Section 5.3. Piggyback Registration . . . . . . . . . 17
Section 5.4. Delay of Piggyback Registration . . . . 18
Section 5.5. Holdback Agreements . . . . . . . . . . 18
Section 5.6. Right to Purchase in Lieu of
Registration . . . . . . . . . . . . . 19

ARTICLE VI - REGISTRATION EXPENSES . . . . . . . . . . . . . 19
Section 6.1. Registration Expenses . . . . . . . . . 19

ARTICLE VII - REGISTRATION PROCEDURE . . . . . . . . . . . . 20
Section 7.1. Shareholder Information . . . . . . . . 20
Section 7.2. Compliance . . . . . . . . . . . . . . . 21
Section 7.3. Provision of Prospectuses . . . . . . . 21
Section 7.4. Blue Sky Compliance . . . . . . . . . . 22
Section 7.5. Listing of Vail Equity . . . . . . . . . 22
Section 7.6. Stop Orders . . . . . . . . . . . . . . 22

ARTICLE VIII - INDEMNIFICATION AND CONTRIBUTION . . . . . . 23
Section 8.1. Indemnification . . . . . . . . . . . . 23
Section 8.2. Contribution . . . . . . . . . . . . . . 27

ARTICLE IX - TAKE-ALONG RIGHTS . . . . . . . . . . . . . . . 28
Section 9.1. Take-Along Rights . . . . . . . . . . . 28

-i-
<PAGE> 110
<CAPTION>

Page
----
<S> <C>
ARTICLE X - INITIAL PUBLIC OFFERING . . . . . . . . . . . . 29
Section 10.1. IPO Commitment . . . . . . . . . . . . . 29
Section 10.2. Co-Manager . . . . . . . . . . . . . . . 29
Section 10.3. Foods Initiated IPO . . . . . . . . . . 30

ARTICLE XI - ADDITIONAL COVENANTS . . . . . . . . . . . . . 30
Section 11.1. Maintain Listing or Quotation . . . . . 30
Section 11.2. Board of Directors . . . . . . . . . . . 31
Section 11.3. No Inconsistent Agreements . . . . . . . 31
Section 11.4. Rules 144 and 144A . . . . . . . . . . . 31
Section 11.5. Limitations on Holdings of Foods
Associates . . . . . . . . . . . . . . 31

ARTICLE XII - MISCELLANEOUS . . . . . . . . . . . . . . . . 31
Section 12.1. Entire Agreement . . . . . . . . . . . . 31
Section 12.2. Headings and Captions . . . . . . . . . 31
Section 12.3. Choice of Law . . . . . . . . . . . . . 32
Section 12.4. Venue . . . . . . . . . . . . . . . . . 32
Section 12.5. Notices . . . . . . . . . . . . . . . . 32
Section 12.6. Amendments . . . . . . . . . . . . . . . 33
Section 12.7. Extended Meanings . . . . . . . . . . . 33
Section 12.8. Successors and Assigns . . . . . . . . . 33
Section 12.9. Severability . . . . . . . . . . . . . . 34
Section 12.10. Counterparts . . . . . . . . . . . . . . 34
Section 12.11. Remedies Cumulative . . . . . . . . . . 34
Section 12.12. Binding Agreement . . . . . . . . . . . 34
Section 12.13. Recapitalizations, Exchanges, Etc.,
Affecting Vail Securities . . . . . . 34
Section 12.14. Other Agreements . . . . . . . . . . . . 35
Section 12.15. Termination . . . . . . . . . . . . . . 35
Section 12.16. Enforcement . . . . . . . . . . . . . . 35
Section 12.17. Confidentiality . . . . . . . . . . . . 36
Section 12.18. Fiduciary Accounts . . . . . . . . . . . 36
</TABLE>

-ii-
<PAGE> 111

SHAREHOLDER AGREEMENT
---------------------

THIS SHAREHOLDER AGREEMENT, dated -----------, 1996
(the "Agreement"), is among Vail Resorts, Inc., a Delaware
corporation ("Vail"), Ralston Foods, Inc., a Nevada corporation
("Foods"), and Apollo Ski Partners, L.P., a Delaware limited
partnership ("Apollo") (Foods and Apollo and their respective
legal representatives, successors and assigns are referred to
herein individually as a "Shareholder" and collectively as the
"Shareholders").

WHEREAS, pursuant to the Stock Purchase Agreement dated
as of ----------, 1996 (the "Purchase Agreement") by and among
Vail, Foods and Ralston Resorts, Inc., a Colorado corporation
("Ralston"), Vail acquired all of the outstanding shares of
capital stock of Ralston in exchange for [ ] shares of
Common Stock, par value $.01 per share, of Vail ("Vail Stock");
and

WHEREAS, Apollo owns [ ] shares of Vail Stock and
[ ] shares of Class A Common Stock, par value $.01 per share,
of Vail ("Vail Class A Stock"); and

WHEREAS, the parties hereto desire to enter into this
Agreement to provide for certain rights and restrictions with
respect to the shares of Vail Equity (as hereinafter defined).

NOW, THEREFORE, in consideration of the mutual
covenants and obligations set forth herein, each of Vail and
Foods agree as follows:

ARTICLE I

DEFINITIONS
-----------

As used in this Agreement, and unless the context
requires a different meaning, the following terms (whether used
in the singular or plural) have the meanings indicated herein.
Any term used and not defined herein has the meaning set forth in
the Purchase Agreement.

"Affiliate" of a Person means any other Person that
---------
directly or indirectly through one or more intermediaries
Controls, is Controlled by or is under common Control with such
Person.

<PAGE> 112

-2-

"Apollo" has the meaning set forth above in the
------
recitals to this Agreement.

"Apollo Option Period" has the meaning set forth in
--------------------
Section 4.1(c) of this Agreement.

"Associate" of a Person means any of such Person's
---------
directors, officers, shareholders, representatives, trustees,
employees, attorneys, advisors or agents.

"Business Day" means any day other than a Saturday,
------------
Sunday or legal holiday for commercial banks in New York City.

"Change of Control" means any "person" or "group"
-----------------
(as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than Apollo
or one or more Affiliates of Appollo, becomes the beneficial
owner of (i) more than 50% of the total outstanding Vail
Securities or (ii) such number of Vail Securities which would
allow such person or group to elect a majority of the Board of
Directors of Vail.

"Closing" means the closing of the transactions
-------
contemplated by the Purchase Agreement.

"Control" (including the terms "Controlling,"
-------
"Controlled by" and "under common Control with") means the
possession of the power, directly or indirectly, (a) to elect a
majority of the board of directors (or equivalent governing body)
of the entity in question; or (b) to direct or cause the
direction of the management and policies of or with respect to
the entity or assets in question, whether through ownership of
securities, by contract or otherwise.

"Demand Notice" has the meaning set forth in
-------------
Section 5.1(a) of this Agreement.

"Demand Registration" has the meaning set forth in
-------------------
Section 5.1(a) of this Agreement.

"Discussion Period" has the meaning set forth in
-----------------
Section 10.3(b) of this Agreement.

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

<PAGE> 113

-3-

"First Option" has the meaning set forth in Section
------------
4.1(b) of this Agreement.

"Foods" has the meaning set forth above in the
-----
recitals to this Agreement.

"Foods Initiated IPO" has the meaning set forth in
-------------------
Section 10.3(b) of this Agreement.

"Foods Notice" has the meaning set forth in Section
------------
10.3(b) of this Agreement.

"GAAP" means accounting principles which are
----
(a) consistent with the principles promulgated or adopted by the
Financial Accounting Standards Board and its predecessors in
effect from time to time and (b) applied on a basis consistent
with prior periods.

"Group" means any group of Persons within the
-----
meaning of Section 13(d)(3) of the Exchange Act.

"IPO" means the consummation of an initial public
---
offering of Vail Stock pursuant to a registration statement filed
with the Securities and Exchange Commission.

"Loss" has the meaning set forth in Section
----
8.1(a)(i) of this Agreement.

"Marketable Number" has the meaning set forth in
-----------------
Section 5.1(e) of this Agreement.

"Non-Qualified Transferee" has the meaning set
------------------------
forth in Section 9.1 of this Agreement.

"Non-Requesting Shareholder" has the meaning set
--------------------------
forth in Section 5.1(e) of this Agreement.

"Person" means an individual, corporation,
------
partnership, trust, incorporated or unincorporated association,
joint venture, joint stock company, limited liability company,
government (or an agency or political subdivision thereof) or
other entity of any kind.

"Piggyback Notice" has the meaning set forth in
----------------
Section 5.3(a) of this Agreement.

<PAGE> 114

-4-

"Piggyback Registration" has the meaning set forth
----------------------
in Section 5.3(a) of this Agreement.

"Piggyback Shareholder" has the meaning set forth
---------------------
in Section 5.3(a) of this Agreement.

"Private Sale" has the meaning set forth in
------------
Section 2.2 of this Agreement.

"Purchase Agreement" has the meaning set forth
------------------
above in the recitals to this Agreement.

"Ralston" has the meaning set forth above in the
-------
recitals to this Agreement.

"Registration Statement" means any registration
----------------------
statement or comparable document under Section 5 of the
Securities Act through which a public sale or disposition of Vail
Securities may be registered other than a registration statement
(a) relating to an Employee Benefit Plan or similar plan or a
business combination or (b) on any form that is not available for
a secondary offering.

"Requesting Shareholder" has the meaning set forth
----------------------
in Section 5.1(d) of this Agreement.

"SEC" means the Securities and Exchange Commission
---
or other federal agency at the time administering the Securities
Act, the Exchange Act or any successor acts thereto.

"Second Option" has the meaning set forth in
-------------
Section 4.1(c) of this Agreement.

"Section 4.1 Shares" has the meaning set forth in
------------------
Section 4.1(a) of this Agreement.

"Section 5.6 Shares" has the meaning set forth in
------------------
Section 5.6 of this Agreement.

"Section 9.1 Shares" has the meaning set forth in
------------------
Section 9.1 of this Agreement.

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

"Shareholder" means Apollo or Foods and its
-----------
permitted successors and assigns.

<PAGE> 115

-5-

"Shareholder Indemnified Party" has the meaning set
-----------------------------
forth in Section 8.1(c) of this Agreement.

"Transfer" with respect to all or any part of the
--------
Vail Equity means to directly or indirectly (whether or not
through an underwriter) sell, convey, distribute, transfer (by
merger or otherwise), assign, devise, exchange, encumber, gift,
pledge, hypothecate or otherwise dispose of such Vail Equity
(including without limitation the sale or disposition of an
entity the primary asset of which is Vail Equity).

"Transfer Notice" has the meaning set forth in
---------------
Section 4.1(a) of this Agreement.

"Trigger Date" has the meaning set forth in Section
------------
10.3(a) of this Agreement.

"Vail" has the meaning set forth above in the
----
recitals to this Agreement.

"Vail Class A Stock" means the Class A Common Stock
------------------
of Vail, par value $.01 per share.

"Vail Equity" means (i) shares of Vail Stock
-----------
acquired by Foods at the Closing and any other Vail Securities
owned, beneficially or of record, by Foods or any of its
Affiliates at any time during the term of this Agreement and
(ii) shares of Vail Stock, Vail Class A Stock and any other Vail
Securities owned, beneficially or of record, by Apollo or any of
its Affiliates at any time during the term of this Agreement.

"Vail Indemnified Party" has the meaning set forth
----------------------
in Section 8.1(a) of this Agreement.

"Vail Market Price" means the average of the
-----------------
closing sale prices of the Vail Stock being valued on the New
York Stock Exchange or, if the Vail Stock is not listed or
admitted to trading on the New York Stock Exchange, as reported
in the principal consolidated transaction reporting system of the
principal national securities exchange on which the Vail Stock is
listed or admitted to trading, for the twenty (20) trading days
which end on the day immediately prior to the date of the Demand
Notice. If the Vail Stock is not listed or admitted to trading
on any national securities exchange, "Vail Market Price" means
the last quoted sale price or, if not so quoted, the average of
the high bid and low asked prices in the over-the-counter market,
as reported by the National

<PAGE> 116

-6-

Association of Securities Dealers, Inc. Automated Quotation
System or such other system then in use, for the twenty (20)
trading days which end on the day immediately prior to such date
or, if on any such trading day the Vail Stock is not quoted by
any such organization, the average of the closing bid and asked
prices as furnished by two professional market makers making a
market in the Vail Stock, one selected in good faith by the board
of directors of Vail and the other selected in good faith by
Foods. If the Vail Stock is not publicly held or so listed or
publicly traded, "Vail Market Price" means the cash price at
which a willing seller would sell and a willing buyer would buy
such securities in an arm's-length negotiated transaction without
undue time restraints, as determined in good faith by an
investment banking firm selected by agreement between Vail and
Foods.

"Vail Option Period" has the meaning set forth in
------------------
Section 4.1(b) of this Agreement.

"Vail Securities" means the Vail Stock, Vail
---------------
Class A Stock and any other voting securities of Vail or its
Affiliates, including any securities convertible into or
exercisable or exchangeable for any voting securities of Vail.

"Vail Stock" has the meaning set forth above in the
----------
recitals to this Agreement.

ARTICLE II

STANDSTILL AND VOTING PROVISIONS
--------------------------------

Section 2.1 Standstill Covenants. Unless
--------------------
otherwise permitted in this Agreement, Foods agrees that during
the term of this Agreement, it will not, directly or indirectly:

(a) acquire, offer to acquire, or agree to acquire by
purchase or otherwise, any Vail Securities except as a
result of a stock split, stock dividend or similar
recapitalization by Vail;

(b) except in the ordinary course of business,
acquire, offer to acquire, or agree to acquire by purchase
or otherwise, any assets of Vail;

(c) initiate, solicit, propose, seek to effect or
negotiate, alone or with any other Person, (i) any form of
business combination transaction involving Vail or any

<PAGE> 117

-7-

Affiliate thereof, or (ii) any restructuring,
recapitalization or similar transaction with respect to Vail
or any Affiliate thereof;

(d) initiate, solicit, propose, seek to effect,
negotiate, or announce an intent to make, alone or with any
other Person, any tender offer, exchange offer, merger,
consolidation or share exchange for any Vail Securities, or
disclose an intent, purpose, plan or proposal with respect
to Vail, any of its Affiliates or any Vail Securities
inconsistent with the provisions of this Agreement;

(e) make, or in any way participate in, any
"solicitation" of "proxies" (as such terms are defined or
used in Regulation 14A under the Exchange Act) with respect
to Vail or any of its Affiliates or become a "participant"
in any "election contest" (as such terms are defined or used
in Rule 14a-11 under the Exchange Act) involving Vail or any
of its Affiliates;

(f) initiate, solicit or propose the approval of one
or more shareholder proposals with respect to Vail or any of
its Affiliates or induce or attempt to induce any other
Person to initiate any such shareholder proposal;

(g) form, join or in any way participate in a Group
with respect to the Vail Securities;

(h) except as expressly provided herein, seek election
to or seek to place a representative on the board of
directors of Vail or any of its Affiliates or seek the
removal of any member of the board of directors of Vail or
any of its Affiliates;

(i) except for participation on the board of directors
of Vail, act in concert with any other Person to seek to
affect the management or board of directors of Vail or any
of its Affiliates or the business, operations or affairs of
Vail or any of its Affiliates;

(j) call or seek to have called any meeting of the
shareholders of Vail or any of its Affiliates;

(k) disclose to any third party or in any filing with
any governmental authority any intention, plan or
arrangement inconsistent with any of the foregoing or with

<PAGE> 118

-8-

the restrictions on transfer set forth in this Agreement; or

(l) enter into any discussions, negotiations,
arrangements or understandings with any third party with
respect to any of the foregoing, or advise, assist,
encourage or influence any other Person to take any action
with respect to any of the foregoing.

Section 2.2 Acquisition of Vail Securities.
------------------------------
Notwithstanding Section 2.1 hereof, Foods may purchase in one or
more open market transactions or otherwise (including the IPO)
that number of shares of Vail Securities necessary for Foods to
continue to account for its investment in Vail under the equity
accounting method under GAAP; provided, that in no event shall
any such purchase result in the ownership by Foods and its
Affiliates of Vail Securities exceeding 23.5% of the total
outstanding Vail Securities. In the event that Vail proposes to
register or otherwise offer any Vail Securities for sale for its
own account (including the IPO) under the Securities Act (other
than a registration of securities in connection with a merger, an
acquisition, an exchange offer or an employee benefit plan
maintained by Vail or its Affiliates or on Form S-4 or S-8 or any
successor or similar form or by means of a shelf registration
pursuant to Rule 415 under the Securities Act) or in a
transaction exempt from registration under the Securities Act (a
"Private Sale"), Vail will give written notice to Foods of its
intention to do so and of Foods' rights under this Section 2.2,
at least twenty (20) calendar days prior to the anticipated
filing date of a Registration Statement relating to such
registration (or if such transaction is a Private Sale a
comparable period of time). Foods will have the right, but not
the obligation, to elect to purchase shares in such offering
(including the IPO), at the same price Vail is to receive for the
shares to be sold for its account provided that if such offering
is not the IPO Foods shall only have such purchase right if
Apollo is purchasing Vail Securities in such offering, in which
case the number of Vail Securities that Foods may purchase in
such offering shall be equal to the number of shares proposed to
be purchased by Apollo multiplied by a fraction, the numerator of
which is the total number or shares of Vail Equity owned by Foods
at such time and the denominator of which is the sum of the total
number of shares of Vail Equity owned by Apollo and Foods at such
time. In the event that the size of such offering is increased
after Foods has received notice of such offering, Foods will have
the right, but not the obligation, to proportionately increase
its purchase of shares in

<PAGE> 119

-9-

such offering. Foods may exercise its purchase rights under this
Section 2.2 by notifying Vail of its election to purchase shares
(which election shall be irrevocable) in such offering within ten
days of receiving notice from Vail (failure by Foods to give such
notice within such ten-business-day period shall be deemed an
election by Foods not to purchase Vail Securities in such
offering). Any purchase by Foods of Vail Securities pursuant to
this Section 2.2 may not result in Foods and its Affiliates'
ownership exceeding 23.5% of the total outstanding Vail
Securities. Foods shall not be entitled to a Piggyback
Registration with respect to any offering if it has elected to
purchase Vail Securities in such offering.

Section 2.3 Voting of Vail Equity. Foods agrees
---------------------
that during the term of this Agreement, with respect to the
election of directors of Vail, each class of Vail Equity owned by
Foods and its Affiliates shall be voted (i) "for" the nominees
recommended by the Board of Directors of Vail, provided Vail and
Apollo are in compliance with the terms of Section 11.2 of this
Agreement, (ii) in accordance with the recommendation of the
Board of Directors of Vail on each proposal of a security holder
pursuant to Rule 14a-8 under the Exchange Act, so long as the
subject matter of such proposal does not fall within the proviso
hereto, and (iii) with respect to all other matters requiring a
vote of the Vail Equity, "for" any proposal in the same
proportion as the votes cast "for" such proposal by the holders
of the Vail Securities of the same class (excluding the Vail
Equity owned by Foods), and "against" any proposal in the same
proportion as the votes cast "against" such proposal by the
holders of each such class of Vail Securities (excluding the Vail
Equity owned by Foods) and that with respect to broker non-votes
and abstentions, each class of Vail Equity owned by Foods will be
voted in the same proportion as votes deemed "for," "against" or
"abstain," giving effect to broker non-votes and abstentions as
required under the laws and rules then applicable; provided,
--------
however, that Foods shall retain the right to vote its Vail
- - - -------
Equity in any manner it sees fit with respect to any proposals
for (1) the merger, consolidation or other business combination
of Vail or any subsidiary of Vail with or into any other
corporation, (2) the sale, lease, exchange, transfer or other
disposition of all or substantially all of the assets of Vail and
all of its subsidiaries taken together as a single business,
(3) the creation of any other class of stock with voting rights
and (4) changes to the Certificate of Incorporation or Bylaws of
Vail that adversely affect Foods' rights under this Agreement.
The provisions of this Section 2.3 shall apply to both the
casting of votes at

<PAGE> 120

-10-

meetings of shareholders and execution of actions by written
consent.

Section 2.4 Restrictions on Certain Transactions
------------------------------------
Prior to IPO. Prior to the IPO, Vail shall not, without the
- - - ------------
prior written approval of Foods, (1) enter into transactions with
Apollo or its Affiliates that are not on an arm's-length basis
(other than the continuation or extension of contracts or
arrangements between Vail and Apollo and its Affiliates that are
in existence as of the date of this Agreement and have heretofore
been disclosed to Foods), (2) permit (a) the merger of Vail with
or into any other corporation (other than a subsidiary of Vail),
(b) the sale, lease, exchange, transfer or other disposition of
all or substantially all of the assets of Vail and all of its
subsidiaries taken together as a single business, (c) the
creation of any other class of stock with voting rights that
materially adversely affects Foods' rights under this Agreement
or (d) changes to the Certificate of Incorporation or Bylaws of
Vail that adversely affect Foods' rights under this Agreement, or
(3) enter into any material business not currently conducted by
Vail that is not related to the operation of ski resorts, real
estate or the vacation, leisure and entertainment industries.

ARTICLE III

TRANSFER OF VAIL EQUITY
-----------------------

Section 3.1 Restrictions on Transfer. During the
------------------------
term of this Agreement, Foods agrees that it will not, and it
will cause each of its Affiliates who acquire Vail Equity not to,
Transfer any Vail Equity, except as permitted by or in accordance
with this Agreement.

Section 3.2 Exceptions to Restrictions. Subject
--------------------------
to all applicable laws, the restrictions on Transfer set forth in
Section 3.1 hereof shall not apply to any of the following:

(a) a Transfer of some or all of the Vail Equity pro
rata to all of the holders of common stock of Foods as a
dividend or distribution, in redemption of the Foods Stock
or pursuant to a similar transaction;

(b) a Transfer of some or all of the Vail Equity to an
Affiliate of Foods, provided that such Affiliate (i) shall
agree to be bound by and subject to the provisions of this
Agreement, (ii) Foods shall remain liable

<PAGE> 121

-11-

for the performance by such Affiliate of its obligations
under this Agreement and (iii) such Affiliate shall have
executed and delivered to Vail the guaranty required by
Section 5.14 of the Purchase Agreement;

(d) a Transfer of some or all of the Vail Equity in
any tender offer, self-tender, exchange offer, going private
transaction or other transaction involving a Transfer which
is recommended to shareholders of Vail by at least a
majority of the Board of Directors of Vail;

(e) subject to Section 4.1, a Transfer of some or all
of the Vail Equity with the prior written consent of a
majority of the Board of Directors of Vail;

(f) subject to Section 4.1, a Transfer of some or all
of the Vail Equity pursuant to Rule 144 of the Securities
Act if an IPO has not been consummated by December 31, 1998;

(g) subject to Section 4.1, a Transfer of some or all
of the Vail Equity if an IPO has not been consummated by
December 31, 1998 and such transferee agrees to be bound by
the terms of this Agreement; and

(h) subject to Section 4.1, a Transfer of some or all
of the Vail Equity on or after the date which is 18 months
after the date of this Agreement, provided that (i) the
transferee agrees to be bound by and subject to the
provisions of this Agreement, (ii) after giving effect to
such Transfer, the transferee will not own, directly or
indirectly, more than 10% of the then outstanding Vail
Securities and (iii) such transferee agrees with Vail and
Apollo not to thereafter purchase or otherwise acquire,
directly or indirectly, any additional Vail Securities if it
would result in such transferee owning, directly or
indirectly, more than 10% of the then outstanding Vail
Securities.

Section 3.3 Improper Transfer. Any attempt to
-----------------
Transfer any shares of Vail Equity not in accordance with this
Agreement will be null and void and Vail will not give nor
permit the transfer agent of Vail to give any effect to such
attempted Transfer in its stock records.

<PAGE> 122

-12-

Section 3.4 Restrictive Legend.
------------------

(a) A copy of this Agreement will be filed with the
Secretary of Vail and kept with the records of Vail. All
certificates representing shares of Vail Equity hereafter issued
to or acquired by Foods or its successors or permitted assigns,
will bear the following legend (until such time as such shares
are sold pursuant to an effective registration statement or
pursuant to Rule 144 under the Securities Act) noted
conspicuously on such certificates:

THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE BEEN ACQUIRED
FOR INVESTMENT ONLY, AND MAY NOT BE OFFERED, SOLD,
TRANSFERRED (BY MERGER OR OTHERWISE), ASSIGNED, DEVISED,
EXCHANGED, GIFTED, PLEDGED, HYPOTHECATED OR OTHERWISE
DISPOSED OF UNLESS AND UNTIL REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"), AND ANY APPLICABLE
STATE SECURITIES LAWS OR UNLESS SUCH TRANSFER IS EXEMPT FROM
REGISTRATION, AND AN ACCEPTABLE OPINION OF COUNSEL IS
DELIVERED TO VAIL RESORTS, INC. WITH REGARD TO SUCH
EXEMPTION, OR IS OTHERWISE IN COMPLIANCE WITH THE ACT AND
SUCH STATE SECURITIES LAWS.

THE SHARES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO THE
RESTRICTIONS ON TRANSFER SET FORTH IN THE SHAREHOLDER
AGREEMENT, DATED , 1996. NO TRANSFER OF THESE
SHARES WILL BE EFFECTIVE UNLESS AND UNTIL THE TERMS AND
CONDITIONS OF SUCH SHAREHOLDER AGREEMENT HAVE BEEN COMPLIED
WITH IN FULL AND NO PERSON MAY REQUEST VAIL RESORTS, INC.
TO RECORD THE TRANSFER OF ANY SHARES IF SUCH TRANSFER IS IN
VIOLATION OF SUCH SHAREHOLDER AGREEMENT. A COPY OF THE
SHAREHOLDER AGREEMENT IS ON FILE AT THE EXECUTIVE OFFICES OF
VAIL RESORTS, INC. AND WILL BE FURNISHED WITHOUT CHARGE TO
THE HOLDER OF SUCH SHARES UPON WRITTEN REQUEST. THE SHARES
EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON
VOTING PROVIDED FOR IN THE SHAREHOLDER AGREEMENT AND NO VOTE
OF SUCH SHARES THAT CONTRAVENES THE SHAREHOLDER AGREEMENT
SHALL BE EFFECTIVE.

(b) Until such time as the Vail Equity has been
registered pursuant to a registration statement under the
Securities Act or sold pursuant to Rule 144 of the Securities
Act, the certificates representing Vail Equity (including,
without limitation, all certificates issued upon Transfer or in
exchange or substitution therefor) will also bear any legend
required under any other applicable laws, including state
securities or blue sky laws.

<PAGE> 123

-13-

(c) Vail may make a notation on its records or give
stop-transfer instructions to any transfer agents or registrars
for the Vail Equity in order to implement the restrictions set
forth in this Article III.

(d) In the event Foods acquires any other or
additional Vail Securities, Foods will submit all certificates
representing such Vail Securities to Vail so that any appropriate
legend or legends required by this Section 3.4 may be placed
thereon.

ARTICLE IV

RIGHT OF FIRST OFFER
--------------------

Section 4.1 Sales by Foods.
--------------

(a) Prior to any Transfer pursuant to Section 3.2(e),
(f), (g) and (h), Foods must first give written notice of its
intent to make such Transfer (a "Transfer Notice") to Vail and
Apollo setting forth the number of shares of Vail Equity (the
"Section 4.1 Shares") that Foods desires to Transfer and the cash
price that Foods proposes to be paid for such Section 4.1 Shares
and the other terms and conditions of such proposed Transfer.

(b) Vail shall have the right, but not the obligation,
to purchase the Section 4.1 Shares (the "First Option") on the
same terms and conditions as set forth in such notice, which
option shall be exercised by delivering to Foods irrevocable
written notice of its commitment to purchase the Section 4.1
Shares within ten business days after receipt of the Transfer
Notice (the "Vail Option Period"). Failure by Vail to give such
notice within such ten-business-day period shall be deemed an
election by Vail not to purchase the Section 4.1 Shares.

(c) In the event that Vail decides not to purchase the
Section 4.1 Shares pursuant to Section 4.1(b), then Apollo will
have the right, but not the obligation, to purchase the Section
4.1 Shares (the "Second Option") on the same terms and conditions
as set forth in the Transfer Notice, which option shall be
exercised by delivering to Foods irrevocable written notice of
its commitment to purchase the Section 4.1 Shares within five
business days after the termination of the Vail Option Period
(the "Apollo Option Period"). Failure by Apollo to give such
notice within such five-business-day period shall

<PAGE> 124

-14-

be deemed an election by Apollo not to purchase the Section 4.1
Shares.

(d) Delivery of written notice by Vail or Apollo
accepting the First Option or the Second Option, as the case may
be, shall constitute a contract between Vail or Apollo, on the
one hand, and Foods, on the other hand, for the purchase and sale
of the Section 4.1 Shares on the terms and conditions set forth
in the Transfer Notice. The purchase of any shares pursuant to
the exercise of the First Option or the Second Option, as the
case may be, shall be completed not later than 30 days following
delivery of the Transfer Notice with respect to the Section 4.1
Shares, subject to receipt of any required material third-party
or governmental approvals, compliance with applicable laws and
the absence of any injunction or similar legal order preventing
such transaction. In the event that neither the First Option nor
the Second Option is exercised, Foods shall have the right for a
period of 45 days after the termination of the Apollo Option
Period to Transfer the Section 4.1 Shares at a price not less
than 90% of the price contained in, and on terms and conditions
no less favorable to Foods than those set forth in, the Transfer
Notice; provided that the Transferee agrees to be bound by
--------
the terms and conditions of this Agreement (unless the Transfer
is pursuant to Rule 144 under the Securities Act).

ARTICLE V

REGISTRATION
------------

Section 5.1 Demand Registration.
-------------------

(a) After the consummation of an IPO or at such time
prior to the consummation of an IPO as is permitted by Section
10.3 with respect to a given Shareholder, upon a Shareholder's
written request specifying the intended manner of disposition
(including the number of shares of Vail Equity to be sold) (a
"Demand Notice"), Vail will use its best efforts to prepare and
file with the SEC, as expeditiously as possible, a Registration
Statement on an available form for which Vail then qualifies (but
not including by means of a shelf registration pursuant to Rule
415 under the Securities Act), which legal counsel for Vail deems
appropriate and which is available for the sale of Vail Equity
to permit an underwritten public offering of some or all of the
shares of Vail Equity then held by such Shareholder and use its
best efforts to cause such registration statement to become
effective (a "Demand Registration").

<PAGE> 125

-15-

(b) A Demand Registration will not be deemed to have
occurred until it has become effective under the Securities Act
(unless a Shareholder delivers a Demand Notice and subsequently
withdraws the Demand Notice, in which case such Demand
Registration will be deemed to have occurred unless such
Shareholder agrees to pay all reasonable out-of-pocket expenses
associated with such registration actually incurred by Vail);
provided, however, that if, after a Demand Registration has
become effective, the offering of Vail Equity pursuant to such
Demand Registration is prohibited by any stop order, injunction
or other order or requirement of the SEC or other governmental
agency or a court, such Demand Registration will be deemed not to
have occurred (unless such prohibition on the sale of the Vail
Equity is based on actions or omissions of such Shareholder, in
which case such Demand Registration will be deemed to have
occurred unless such Shareholder agrees to pay all reasonable
out-of-pocket expenses associated with such registration actually
incurred by Vail).

(c) Vail shall only be obligated to effect one Demand
Registration per Shareholder in any twelve month period under
this Section 5.1; provided, however, that Vail will not be
required to register the Vail Equity pursuant to a Demand Notice
under this Section 5.1 if at such time (i) the shares of Vail
Equity which a Shareholder is requesting to be registered
pursuant to this Section 5.1 constitute less than 6.0% (or, if
less, all of the shares of Vail Equity owned by such Shareholder)
of the outstanding Vail Securities so requested to be registered
or (ii) such Demand Notice is given within six (6) months after
the effective date of any other registration of any Vail
Securities under the Securities Act.

(d) The managing underwriter will be selected by the
Shareholder requesting registration pursuant to this Section 5.1
(the "Requesting Shareholder"); provided, however, that such
underwriter shall be subject to the approval of Vail, which
approval shall not be unreasonably withheld. In the event there
is one or more co-managers, the first such co-manager shall be
selected by Vail, provided that such co-manager shall be subject
to the approval of the Requesting Shareholder, which approval
shall not be unreasonably withheld or delayed, and all other co-
managers will be selected by the Requesting Shareholder.

(e) In connection with a Demand Registration, both the
Shareholder not requesting the Demand Registration (the "Non-
Requesting Shareholder") and Vail may elect to include

<PAGE> 126

-16-

additional shares of Vail Securities in such offering on the same
terms and conditions as the Vail Equity to be sold by the
Requesting Shareholder; provided, however, that if the managing
underwriter(s) advises the Requesting Shareholder, the Non-
Requesting Shareholder and Vail that, in its judgment, the number
of shares proposed to be included in such offering exceeds the
largest number of Vail Securities which can be sold without
having an adverse effect on such offering, including the price at
which such securities can be sold (the "Marketable Number"), then
the total number of shares to be included in such offering shall
be limited as follows: (i) first, all the shares of Vail Equity
that the Requesting Shareholder and the Non-Requesting
Shareholder propose to sell up to the Marketable Number,
allocated pro rata between the Requesting Shareholder and the
Non-Requesting Shareholder on the basis of the relative number of
Vail Securities that the Requesting Shareholder and the
Non-Requesting Shareholder have proposed to be included in such
registration, and (ii) second, all the shares of Vail Securities
that Vail proposes to sell, which does not exceed the difference,
if any, between the Marketable Number and that number of shares
which the Requesting Shareholder and the Non-Requesting
Shareholder have included pursuant to clauses (i) and (ii) above.

Section 5.2 Delay of Demand Registration.
----------------------------
Notwithstanding anything to the contrary in Article V hereof, in
the event that Vail determines in its reasonable judgment that it
may be advisable to delay filing a Registration Statement
described in Section 5.1 hereof or to withdraw such Registration
Statement if such Registration Statement has already been filed,
Vail may delay filing such, or withdraw such previously filed,
Registration Statement for a period of not more than ninety (90)
days from the date of receipt of the request for the Demand
Registration if Vail furnishes to the Requesting Shareholder a
certificate signed by an executive officer of Vail stating that
Vail has reasonably determined that (i) such a filing would
adversely affect any proposed financing or acquisition by Vail or
(ii) such a filing would otherwise represent an undue hardship
for Vail; provided, however, that Vail will, at the request of
-------- -------
the Requesting Shareholder, file or refile, as the case may be,
such Registration Statement promptly after Vail, in its
reasonable judgment, determines that it is no longer advisable to
delay filing or to continue the withdrawal of such Registration
Statement but in no event shall the filing or re-filing of such
Registration Statement be delayed more than the aforementioned
ninety (90) days.

<PAGE> 127

-17-

Section 5.3 Piggyback Registration.
----------------------

(a) Right To Include Vail Equity.
----------------------------

(i) If Vail or any other Person (other than a
Shareholder) at any time proposes to register any Vail Securities
under the Securities Act (other than a registration of securities
in connection with a merger, an acquisition, an exchange offer or
an employee benefit plan maintained by Vail or its Affiliates or
on Form S-4 or S-8 or any successor or similar form or by means
of a shelf registration pursuant to Rule 415 under the Securities
Act to permit sales of Vail Securities by employees, officers and
directors of Vail), whether or not for sale for its own account,
in a manner which would permit registration of the Vail Equity
for sale to the public under the Securities Act, it will give
written notice to each Shareholder of its intention to do so and
of such Shareholder's rights under this Section 5.3(a)(i), at
least twenty (20) calendar days prior to the anticipated filing
date of a Registration Statement relating to such registration (a
"Piggyback Notice"). Such Piggyback Notice will offer each
Shareholder the opportunity to include in such Registration
Statement that number of shares of Vail Equity as such
Shareholder may request. Upon the written request (the
"Piggyback Registration") (which request will specify the number
of shares of Vail Equity intended to be disposed of by each
Shareholder pursuant to such Registration Statement) of each
Shareholder (the "Piggyback Shareholder") made within ten (10)
calendar days after the receipt of the Piggyback Notice, Vail
will use its best efforts to effect the registration under the
Securities Act of all shares of Vail Equity which Vail has been
so requested to register; provided, however, that each
-------- -------
Shareholder must sell its Vail Equity requested to be included in
such registration to the underwriter(s) selected by Vail on the
same terms and conditions as apply to other Persons, including
Vail, and if, at any time after receiving a reply from each
Shareholder to a Piggyback Notice and prior to the effective date
of the Registration Statement filed in connection with such
registration, Vail decides for any reason not to register any
shares of Vail Securities, Vail will notify each Shareholder and
thereupon be relieved of its obligation to register any Vail
Equity in connection with such registration.

(ii) No registration, whether or not effected under
this Section 5.3(a), will relieve Vail of its obligations to
effect Demand Registrations under Section 5.1 hereof.

<PAGE> 128

-18-

(b) Priority in Piggyback Registrations. If the
-----------------------------------
managing underwriter advises Vail in writing that, in its
opinion, the Marketable Number is less than that intended to be
included in a Registration Statement, Vail will include in such
Registration Statement (i) first, all of the Vail Securities Vail
proposes to sell for its own account, and (ii) second, the Vail
Securities requested to be included by the Shareholders and other
Persons pursuant to Section 5.3(a) hereof shall be allocated pro
rata among the Shareholders on the basis of the relative number
of Vail Securities each Shareholder and such other Persons has
requested to be included in such registration.

Section 5.4 Delay of Piggyback Registration.
-------------------------------
Notwithstanding anything to the contrary in this Article V, in
the event that Vail determines in its reasonable judgment that it
may be advisable to delay filing a Registration Statement
described in Section 5.3 hereof or to withdraw such Registration
Statement if such Registration Statement has already been filed,
Vail may delay filing such, or withdraw such previously filed,
Registration Statement in accordance with the provisions of
Section 5.2 hereof.

Section 5.5 Holdback Agreements.
-------------------

(a) Whenever Vail effects an underwritten public
offering of Vail Equity pursuant to a registration statement
(including the IPO), each Shareholder agrees not to effect any
public sale or distribution, including any sale pursuant to Rule
144 under the Securities Act, of any Vail Securities (other than
as part of such registration) during the 15 days prior to, and
during the 180-day period (or such shorter period as may be
requested by the lead underwriter for such offering) beginning
on, the effective date of such registration statement.

(b) In connection with underwritten public offering of
Vail Equity pursuant to a registration statement under this
Agreement, Vail agrees not to effect any public sale or
distribution of any Vail Securities (other than as part of such
registration or in connection with any employee stock option or
other benefit plan or any private issuance of Vail Equity where
the recipient also agrees to be bound by the hold back
arrangements applicable to Vail under this Section 5.5) during
the 15 days prior to, and during the 90-day period (or such
shorter period as may be requested by the lead underwriter for such

<PAGE> 129

-19-

offering) beginning on the effective date of, such registration
statement.

Section 5.6 Right to Purchase in Lieu of Registration.
-----------------------------------------

(a) Any time Vail receives a request for a Demand
Registration or a Piggyback Registration from Foods, Vail shall
have the option to purchase all but not less than all of the Vail
Equity proposed to be disposed of in such request (the "Section
5.6 Shares") at the Vail Market Price by delivering to Foods, a
notice of Vail's election to purchase the Section 5.6 Shares
within seven (7) days of receipt by Vail of the request for the
Demand Registration or Piggyback Registration, as the case may
be, pursuant to Section 5.1 or Section 5.3(a), as the case may
be.

(b) In the event that Vail decides not to purchase the
Section 5.6 Shares pursuant to Section 5.6(a), then Apollo will
have the right, but not the obligation, to purchase the Section
5.6 Shares at the Vail Market Price by delivering to Foods a
notice of Apollo's election to purchase the Section 5.6 Shares
within seven (7) days of Vail deciding not to purchase the
Section 5.6 Shares.

ARTICLE VI

REGISTRATION EXPENSES
---------------------

Section 6.1 Registration Expenses.
---------------------

(a) Subject to Section 5.1(b) of this Agreement, all
expenses incident to Vail's performance of or compliance with
Articles V and VII of this Agreement to effect Demand
Registrations and Piggyback Registrations will be borne by Vail,
including, without limitation:

(i) all federal registration and filing fees;

(ii) subject to Section 7.4, fees and expenses of
compliance with securities or blue sky laws; provided,
--------
however, that Vail will in no event be obligated to pay
-------
the fees and disbursements of counsel for the underwriters
or the Shareholders in connection with blue sky
qualifications of the Vail Equity under the laws of such
jurisdictions as the managing underwriter(s) may designate;

<PAGE> 130

-20-

(iii) printing, messenger, telephone and delivery
expenses;

(iv) fees and disbursements of legal counsel for Vail;

(v) fees and disbursements of all independent
certified public accountants of Vail;

(vi) NASD fees and disbursements of the underwriters;
provided, however, that in all cases a Shareholder will
-------- -------
pay all costs of discounts, commissions, spreads or fees of
underwriters, selling brokers, dealer managers or similar
securities industry professionals relating to the
distribution of the Vail Equity being sold by such
Shareholder;

(vii) fees and expenses of other Persons retained by
Vail; and

(viii) listing or quotation fees and expenses required to
be made pursuant to Section 7.5 hereof in connection with
the Registration Statement.

(b) Each of Vail and the Shareholders will pay its own
respective internal expenses (including, without limitation, all
salaries and expenses of its officers and employees performing
legal or accounting duties), the fees and expenses of any Person,
including special experts, retained by Vail or the Shareholders,
respectively.

ARTICLE VII

REGISTRATION PROCEDURE
----------------------

Section 7.1 Shareholder Information. Each
-----------------------
Shareholder will provide Vail with such information about such
Shareholder and the intended manner of distribution of Vail
Equity and otherwise cooperate with Vail and the underwriter(s)
as may be necessary in the reasonable opinion of Vail to satisfy
any obligation of Vail under this Agreement to register the Vail
Equity under federal or state securities laws and otherwise take
actions related thereto. In the event of the failure of a
Shareholder to comply with the requirements of the preceding
sentence Vail may delay filing such, and withdraw such previously
filed, Registration Statement. Vail will file or refile, as the
case may be, such Registration Statement

<PAGE> 131

-21-

promptly following compliance with such requirements by a
Shareholder; provided, however, that a Shareholder will be
-------- -------
responsible for any reasonable out-of-pocket costs which arise
out of such non-compliance. A Shareholder will immediately
notify Vail upon discovery that any information provided by such
Shareholder which is included in the prospectus that is included
in a Registration Statement, as then in effect, is untrue in any
material respect, or omits to state any material fact required to
be stated therein or to make the information stated therein not
misleading in the light of the circumstances under which it is
presented.

Section 7.2 Compliance. Each Shareholder and Vail
----------
will comply with all rules and regulations of the SEC and
applicable state securities or blue sky laws governing the manner
of sale of securities in connection with the Transfer of any of
the Vail Equity pursuant to any Registration Statement.

Section 7.3 Provision of Prospectuses.
-------------------------

(a) Vail will furnish to each Shareholder such number
of copies of a summary prospectus or other prospectus, including
a prospectus subject to completion in conformity with the
requirements of the Securities Act, and such other documents as
such Shareholder may reasonably request in writing, in order to
facilitate the public sale or other disposition of the Vail
Equity of each Shareholder included in a Registration Statement.

(b) At any time when a sale or other disposition of
Vail Equity pursuant to a Registration Statement is subject to a
prospectus delivery requirement, Vail will notify each
Shareholder of the occurrence of any event that causes the
prospectus included in such Registration Statement, as then in
effect, to include an untrue statement of a material fact or to
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in the
light of the circumstances then existing and Vail will use its
best efforts, as expeditiously as possible, to either amend the
prospectus or otherwise take any actions so that use of the
previous prospectus may be legally resumed. Upon receipt of such
a notice, each Shareholder will immediately discontinue all sales
or other dispositions of Vail Equity pursuant to the Registration
Statement. Each Shareholder may resume such sales or
dispositions only upon receipt of an amended prospectus or after
such Shareholder is advised by Vail that the use of the previous
prospectus may be legally resumed.

<PAGE> 132

-22-

Section 7.4 Blue Sky Compliance. Vail will use
-------------------
its best efforts to (a) register or qualify the Vail Equity
included in a Registration Statement under the securities or blue
sky laws of such jurisdictions as each Shareholder reasonably
requests and (b) do any and all other acts that may be reasonably
necessary or advisable to enable each Shareholder to consummate
the public sale or disposition of such securities in such
jurisdictions; provided, however, that Vail is not required
-------- -------
to consent to, or take any action that would subject it to,
general service of process or taxation in any jurisdiction
where it is not then so subject, nor qualify to do business in
any jurisdiction where it is not then so qualified.

Section 7.5 Listing of Vail Equity. Vail will use
----------------------
its best efforts to cause the Vail Equity when issued to be
listed on all securities exchanges on which any securities issued
by Vail are then listed, or quoted on all automated quotation
systems on which any such securities of Vail are then quoted,
including, without limitation, entering into appropriate
customary agreements (including a listing application and
indemnification agreement in customary form).

Section 7.6 Stop Orders. Vail will promptly
-----------
notify each Shareholder of (a) the receipt by Vail of any
notification with respect to the issuance by the SEC of any stop
order or order suspending the effectiveness of any Registration
Statement covering any Vail Equity or the initiation of any
proceedings for that purpose or (b) the receipt by Vail of any
notification with respect to the limitation, restriction or
suspension of the offer or sale of Vail Equity in any
jurisdiction in which the Vail Equity was qualified to be sold,
or the initiation of any proceedings for such purpose. In the
event that Vail notifies each Shareholder of any such event, each
Shareholder will immediately discontinue all sales or other
dispositions of Vail Equity pursuant to the Registration
Statement until such time that Vail notifies each Shareholder of
the lifting of such stop order or similar order; provided,
--------
however, that such a stop order or similar order issued by a
- - - -------
state securities or blue sky administrator will apply only to
offers and sales in such state, unless each Shareholder is
advised otherwise by Vail. Vail, with the cooperation of each
Shareholder, will use its best efforts to contest any such
proceedings and to obtain the withdrawal of any such order at the
earliest possible date.

<PAGE> 133

-23-

ARTICLE VIII

INDEMNIFICATION AND CONTRIBUTION
--------------------------------

Section 8.1 Indemnification.
---------------

(a) Indemnification by Foods.
------------------------

(i) Foods agrees to indemnify and hold harmless Vail
and its Affiliates and Associates (each such Person being
hereinafter referred to as a "Vail Indemnified Party") from and
against all losses, claims, damages, liabilities and expenses
(including reasonable costs of investigation and legal expenses)
(each a "Loss") arising out of or based upon any untrue statement
or alleged untrue statement of a material fact contained in any
Registration Statement or preliminary, final or summary
prospectus covering the Vail Equity, or in any amendment or
supplement thereto, or in any document incorporated by reference
into any of the foregoing or arising out of or based upon any
omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, but only if, and only to the extent, such
statement or alleged statement or omission or alleged omission
was made in reliance upon and in conformity with written
information furnished to Vail or its representatives by or on
behalf of Foods for use in the preparation of such Registration
Statement, preliminary, final or summary prospectus or such
amendment or supplement thereto, or such document incorporated by
reference. This indemnity will be in addition to any liability
which Foods may otherwise have. Foods will also indemnify the
underwriter(s), selling broker(s), dealer manager(s) and similar
securities industry professionals participating in the
distribution, their officers and directors and each Person who
Controls such Persons to the same extent as provided above with
respect to the indemnification of a Vail Indemnified Party.

(ii) Foods also agrees to indemnify and hold harmless
any Vail Indemnified Party to the same extent as provided in
clause (i) above from and against all Losses arising out of any
action or proceeding brought against any Vail Indemnified Party
in connection with the distribution or proposed distribution of
Vail Equity to the holders of Foods Stock; provided,
--------
however, that this Section 8.1(a)(ii) shall not apply to any
- - - -------
Losses for which Vail is responsible as provided in
Section 8.1(c) of this Agreement.

<PAGE> 134

-24-

(iii) If any action or proceeding (including any
governmental investigation or inquiry) is brought or asserted
against a Vail Indemnified Party in respect of which indemnity
may be sought from Foods, such Vail Indemnified Party will
promptly notify Foods in writing of the commencement of such
action and Foods shall assume the defense thereof and have
primary control over any related suit or proceeding, including
the employment of legal counsel and the payment of all expenses
in connection therewith; provided, however, that the failure
-------- -------
of any Vail Indemnified Party to give notice as provided
herein shall not relieve Foods of its obligations under this
Section 8.1(a) except to the extent that Foods is actually
materially prejudiced by such failure to give notice. A Vail
Indemnified Party shall have the right to participate in and
jointly with Foods, to the extent that it may wish, and employ
separate counsel reasonably satisfactory to such Vail Indemnified
Party, provided, however, that Foods will not be liable to
-------- -------
such Vail Indemnified Party for any legal or other expenses
incurred by such Vail Indemnified Party in connection therewith,
unless such Vail Indemnified Party shall have been advised by
counsel that a conflict of interest between such Vail Indemnified
Party and Foods is likely to exist in respect of such claim.

(b) Indemnification by Apollo.
-------------------------

(i) Apollo agrees to indemnify and hold harmless each
Vail Indemnified Party from and against all Losses arising out of
or based upon any untrue statement or alleged untrue statement of
a material fact contained in any Registration Statement or
preliminary, final or summary prospectus covering the Vail
Equity, or in any amendment or supplement thereto, or in any
document incorporated by reference into any of the foregoing or
arising out of or based upon any omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, but only
if, and only to the extent, such statement or alleged statement
or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to Vail or its
representatives by or on behalf of Apollo for use in the
preparation of such Registration Statement, preliminary, final or
summary prospectus or such amendment or supplement thereto, or
such document incorporated by reference. This indemnity will be
in addition to any liability which Apollo may otherwise have.
Apollo will also indemnify the underwriter(s), selling broker(s),
dealer manager(s) and similar securities industry professionals

<PAGE> 135

-25-

participating in the distribution, their officers and directors
and each Person who Controls such Persons to the same extent as
provided above with respect to the indemnification of a Vail
Indemnified Party.

(ii) Apollo also agrees to indemnify and hold harmless
any Vail Indemnified Party to the same extent as provided in
clause (i) above from and against all Losses arising out of any
action or proceeding brought against any Vail Indemnified Party
in connection with the distribution or proposed distribution of
Vail Equity to the holders of Apollo Stock; provided,
--------
however, that this Section 8.1(b)(ii) shall not apply to any
- - - -------
Losses for which Vail is responsible as provided in
Section 8.1(c) of this Agreement.

(iii) If any action or proceeding (including any
governmental investigation or inquiry) is brought or asserted
against a Vail Indemnified Party in respect of which indemnity
may be sought from Apollo, such Vail Indemnified Party will
promptly notify Apollo in writing of the commencement of such
action and Apollo shall assume the defense thereof and have
primary control over any related suit or proceeding, including
the employment of legal counsel and the payment of all expenses
in connection therewith; provided, however, that the failure
-------- -------
of any Vail Indemnified Party to give notice as provided
herein shall not relieve Apollo of its obligations under this
Section 8.1(b) except to the extent that Apollo is actually
materially prejudiced by such failure to give notice. A Vail
Indemnified Party shall have the right to participate in and
jointly with Apollo, to the extent that it may wish, and employ
separate counsel reasonably satisfactory to such Vail Indemnified
Party, provided, however, that Apollo will not be liable to
-------- -------
such Vail Indemnified Party for any legal or other expenses
incurred by such Vail Indemnified Party in connection therewith,
unless such Vail Indemnified Party shall have been advised by
counsel that a conflict of interest between such Vail
Indemnified Party and Apollo is likely to exist in respect of
such claim.

(i) Vail agrees to indemnify and hold harmless each
Shareholder and its Affiliates and Associates (each such person
being hereinafter referred to as a "Shareholder Indemnified
Party") from and against all Losses arising out of or based upon
any untrue statement or alleged untrue statement of a material
fact contained in any Registration Statement,

<PAGE> 136

-26-

preliminary, final or summary prospectus covering the Vail
Equity, or in any amendment or supplement thereto, or in any
document incorporated by reference into any of the foregoing or
arising out of or based upon any omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statement therein not misleading, except
insofar as such Losses arise out of or are based solely upon any
such untrue statement or omission or allegation thereof based
upon written information provided by or on behalf of a
Shareholder for inclusion in such Registration Statement,
preliminary, final or summary prospectus, or such amendment or
supplement thereto, or such document incorporated by reference;
provided, however, that Vail will not be liable in any such
- - - -------- -------
case to the extent that any such Loss arises out of or is
based upon an untrue statement or alleged untrue statement or
omission or alleged omission made in any preliminary prospectus
if (A) such Shareholder failed to send or deliver a copy of the
final prospectus with or prior to the delivery of written
confirmation of the sale of the Vail Equity covered by the
Registration Statement to the Person asserting such Loss, and (B)
the final prospectus corrected such untrue statement or omission;
and provided, further, that Vail will not be liable in any
-------- -------
such case to the extent that any such Loss arises out of or
is based upon an untrue statement or omission in the final
prospectus, if such untrue statement or omission is corrected in
an amendment or supplement to the final prospectus and if, having
previously been furnished by or on behalf of Vail with copies of
the final prospectus as so amended or supplemented, such
Shareholder thereafter fails to deliver such prospectus as so
amended or supplemented, prior to or concurrently with the sale
of the Vail Equity to the Person asserting such Loss who
purchased such Vail Equity which is the subject thereof. This
indemnity will be in addition to any liability which Vail may
otherwise have. Vail will also indemnify the underwriter(s),
selling broker(s), dealer manager(s) and similar securities
industry professionals participating in the distribution, their
officers and directors and each Person who Controls such Persons
to the same extent as provided above with respect to the
indemnification of a Shareholder Indemnified Party.

(ii) If any action or proceeding is brought against a
Shareholder Indemnified Party in respect of which indemnity may
be sought against such Shareholder Indemnified Party, such
Shareholder Indemnified Party will promptly notify Vail in
writing of the commencement of such action and Vail will assume
the defense thereof and have primary control over any

<PAGE> 137

-27-

related suit or proceeding, including the employment of legal
counsel and the payment of all expenses in connection therewith;
provided, however, that the failure of any Shareholder
- - - -------- -------
Indemnified Party to give notice as provided herein shall not
relieve Vail of its obligations under this Section 8.1(c) except
to the extent that Vail is actually materially prejudiced by such
failure to give notice. A Shareholder Indemnified Party shall
have the right to participate in and jointly with Vail, to the
extent that it may wish, and employ separate counsel reasonably
satisfactory to such Shareholder Indemnified Party, provided,
--------
however, that Vail will not be liable to such Shareholder
- - - -------
Indemnified Party for any legal or other expenses incurred by
such Shareholder Indemnified Party in connection therewith,
unless such Shareholder Indemnified Party shall have been advised
by counsel that a conflict of interest between such Shareholder
Indemnified Party and Vail is likely to exist in respect of such
claim.

Section 8.2 Contribution.
------------

(a) If the Indemnification provided for in Section 8.1
hereof is unavailable to a Vail Indemnified Party or Shareholder
Indemnified Party under Section 8.1(a), 8.1(b) or Section 8.1(c)
hereof (other than by reason of the exceptions provided in
Sections 8.1(a), 8.1(b) and 8.1(c)) in respect of any Losses
referred to therein, then such indemnifying party, in lieu of
indemnifying such indemnified party, will contribute to the
amount paid or payable by such indemnified party as a result of
such Losses in such proportion as is appropriate to reflect the
relative fault of the indemnifying party, on the one hand, and
the indemnified party, on the other hand, in connection with the
statements or omissions which resulted in such Losses, as well as
any other relevant equitable considerations. The relative fault
of the indemnifying party, on the one hand, and the indemnified
party, on the other hand, shall be determined by reference to,
among other things, whether the untrue statement or alleged
untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied
by such indemnified party and each parties' relative intent,
knowledge, access to information and opportunity to correct or
prevent such statement or omission. The amount paid or payable
by each party as a result of the Losses referred to above will be
deemed to include, subject to the limitations set forth in
Sections 8.1(a), 8.1(b) and 8.1(c) hereof, any legal or other
fees or expenses reasonably incurred by such party in connection
with investigating or defending any action or claim.

<PAGE> 138

-28-

(b) Notwithstanding the provisions of Section 8.2(a)
hereof, no Person found to be guilty of fraudulent
misrepresentation shall be entitled to contribution from any
Person who is not found to be guilty of such fraudulent
misrepresentation.

ARTICLE IX

TAKE-ALONG RIGHTS
-----------------

Section 9.1 Take-Along Rights. Apollo may not
-----------------
effect a Transfer (or a series of related Transfers) of Vail
Equity to one person or a related group of persons if such
Transfer would result in a Change of Control of Vail (other than
Transfers effected by sales of Vail Equity through underwriters
in a public offering or in the securities markets generally) (the
"Section 9.1 Shares") without first complying with this Section
9.1. If Apollo desires to Transfer the Section 9.1 Shares,
Apollo shall give written notice (the "Take-Along Notice") to
Foods stating (i) the name and address of the transferee (the
"Non-Qualified Transferee") and (ii) the price and terms upon
which the Non-Qualified Transferee proposes to purchase the
Section 9.1 Shares. Foods shall have the irrevocable option, but
not the obligation (the "Take-Along Option"), to sell to the
Non-Qualified Transferee, up to a number of shares of Vail Equity
(the "Included Shares") determined in accordance with Section
9.1(a), at the price and on the terms set forth in the Take-Along
Notice. The Take-Along Option shall be exercised by Foods by
giving written notice to Apollo, within ten business days of
receipt of the Take-Along Notice, indicating its election to
exercise the Take-Along Option. Failure by Foods to give such
notice within the ten business day period shall be deemed an
election by Foods not to sell its shares of Vail Equity pursuant
to that Take-Along Notice. The closing with respect to any sale
to a Non-Qualified Transferee pursuant to this Section 9.1 shall
be held at the time and place specified in the Take-Along Notice
but in any event within 30 days of the date the Take-Along Notice
is given; provided that if through the exercise of reasonable
--------
efforts Apollo is unable to cause such transaction to close
within 30 days, such period may be extended for such reasonable
period of time as may be necessary to close such transaction.
Consummation of the sale of the Section 9.1 Shares by Apollo to a
Non-Qualified Transferee shall be conditioned upon consummation
of the sale by Foods to such Non-Qualified Transferee of the
Included Shares, if any.

<PAGE> 139

-29-

(a) The number of Included Shares purchased from Foods
shall be determined by multiplying the number of Shares proposed
to be purchased from Apollo by a Non-Qualified Transferee by a
fraction, the numerator of which is the total number of shares of
Vail Equity owned by Foods and the denominator of which is the
sum of the total number of shares of Vail Equity owned by Apollo
and Foods.

(b) Apollo shall arrange for payment directly by the
Non-Qualified Transferee to Foods, upon delivery of the
certificate or certificates representing the Included Shares duly
endorsed for transfer, together with such other documents as the
Non-Qualified Transferee may reasonably request. The reasonable
costs and expenses incurred by Apollo and Foods in connection
with a sale of shares of Vail Equity subject to this Section 9.1
shall be allocated pro rata based upon the number of shares of
Vail Equity sold by each Shareholder to a Non-Qualified
Transferee.

(c) If, at end of 30 days following the date on which
a Take-Along Notice was given, the sale of shares of Vail Equity
by Apollo and the sale of the Included Shares, if any, have not
been completed in accordance with the terms of the Non-Qualified
Transferee's offer, all certificates representing the Included
Shares shall be returned to Foods, and all the restrictions on
Transfer contained in this Agreement with respect to shares of
Vail Equity owned by Apollo shall again be in effect.

ARTICLE X

INITIAL PUBLIC OFFERING
-----------------------

Section 10.1 IPO Commitment. Vail and Apollo
--------------
hereby agree to use reasonable efforts to consummate the IPO as
soon as possible following the Closing.

Section 10.2 Co-Manager. In connection with the
----------
IPO (unless the IPO is effected by means of a Demand Registration
by Foods), Foods shall select one of the co-managers (other than
the lead manager); provided, however, that such co-manager shall
-------- -------
be subject to the approval of Vail, which approval shall not be
unreasonably withheld.

<PAGE> 140

-30-

Section 10.3 Foods Initiated IPO.
-------------------

(a) If the IPO has not been consummated on the later
of (i) September 30, 1997 or (ii) nine months after the Closing
(the "Trigger Date"), Apollo, Vail and Foods agree to abide by
the procedures of this Section 10.3.

(b) Following the Trigger Date, Apollo and Foods agree
to discuss in good faith for a period of 30 days (the "Discussion
Period") the timing of the IPO. At the conclusion of the
Discussion Period, Foods may deliver a notice to Vail within 30
days (the "Foods Notice") stating that it will request a Demand
Registration unless Vail consummates the IPO within three months
from the date of the Foods Notice. If at the conclusion of such
three-month period the IPO has not been consummated, during the
next six months Foods shall have the right to request a Demand
Registration and consummate the IPO by means of such Demand
Registration. If at the conclusion of such six-month period the
IPO has not been consummated, Foods' right to request a Demand
Registration to effect the IPO shall be suspended for a twelve-
month period. If at the conclusion of such twelve-month period
the IPO has not otherwise been consummated, during the next six
months Foods shall again have the right to request a Demand
Registration and consummate the IPO by means of such Demand
Registration. If the IPO is consummated by means of a Demand
Registration by Foods (the "Foods Initiated IPO"), then Foods
shall select the lead manager for the Foods Initiated IPO;
provided, however, that such lead manager shall be subject
- - - -------- -------
to the approval of Vail, which approval shall not be unreasonably
withheld or delayed. Vail may select one co-manager in
connection with a Foods Initiated IPO, subject to the approval
of the lead manager for the Foods Initiated IPO, which approval
shall not be unreasonably withheld or delayed.

ARTICLE XI

ADDITIONAL COVENANTS
--------------------

Section 11.1 Maintain Listing or Quotation. Vail
-----------------------------
hereby covenants and agrees that it shall use its best efforts to
maintain its listing of Vail Securities on any securities
exchanges on which Vail Securities are listed in the future
pursuant to Section 7.5 hereof and to maintain its quotation of
Vail Securities on any automated quotation systems on which Vail
Securities are quoted in the future pursuant to Section 7.5
hereto.

<PAGE> 141

-31-

Section 11.2 Board of Directors. Vail and the
------------------
Shareholders agree to take all actions necessary to cause the
Board of Directors to consist of no more than twenty directors.
As long as Foods owns at least 10% of the outstanding Vail
Securities, Vail and the Shareholders agree to take all actions
necessary for Foods to be able to nominate and appoint two
directors to the Board of Directors of Vail, including without
limitation Apollo nominating and electing such directors as Class
1 directors elected by the holders of the Vail Class A Stock.

Section 11.3 No Inconsistent Agreements. Vail
--------------------------
hereby covenants and agrees that it shall not enter into any
agreements governing the transfer or registration of shares of
Vail Securities which would materially adversely affect Foods'
rights under this Agreement without Foods' prior written consent.

Section 11.4 Rules 144 and 144A. Vail hereby
------------------
covenants and agrees that it will use its reasonable best efforts
to file any reports required to be filed by it under the
Securities Act and the Exchange Act and it will take such further
action as Foods may reasonably request, all to the extent
required from time to time to enable Foods to sell its Vail
Equity (subject to the terms hereof) without registration under
the Securities Act within the limitation of the exemptions
provided by (a) Rule 144 or 144A under the Securities Act, as
such Rules may be amended from time to time, or (b) any similar
rule or regulation hereafter adopted by the SEC.

Section 11.5 Limitations on Holdings of Foods
--------------------------------
Associates. Foods shall use its best efforts to cause its
- - - ----------
Associates and Associates of its Affiliates not to own, in the
aggregate, 2% or more of the outstanding Vail Securities.

ARTICLE XII

MISCELLANEOUS
-------------

Section 12.1 Entire Agreement. This Agreement
----------------
constitutes the entire agreement among the parties hereto
relative to the subject matter hereof, and supersedes all prior
written or oral understandings, agreements, conditions or
representations.

Section 12.2 Headings and Captions. All headings
---------------------
and captions used in this Agreement are for convenience only,

<PAGE> 142

-32-

and will not be construed to either limit or broaden the language of
this Agreement or any particular section.

Section 12.3 Choice of Law. This Agreement will
-------------
be governed by and construed under and in accordance with the
laws of the State of New York, without giving effect to the
conflict of laws provisions thereof, except that all matters
relating to the internal affairs of Vail shall be governed by and
construed under and in accordance with the General Corporation
Law of the State of Delaware.

Section 12.4 Venue. Any action or legal
-----
proceedings to enforce this Agreement or any of its terms, or for
indemnification and the recovery of losses as provided for in
this Agreement by a party, may be brought and prosecuted in such
court or courts located in the State of New York as provided by
law, and the parties to this Agreement consent to the
jurisdiction of said court or courts and to service of process by
registered mail, return receipt requested, or by any other manner
provided by New York law.

Section 12.5 Notices. Any notice or other
-------
communication required or permitted hereunder is deemed delivered
when delivered in person, when transmitted by telecopier (which
will also be sent concurrently by certified or registered mail),
on the next Business Day when sent by Federal Express or a
similar overnight delivery service, or on the third Business Day
when sent by registered or certified U.S. mail service as
follows:

If to Foods:

Ralston Foods, Inc.
800 Market Street
Suite 2900
St. Louis, Missouri 63101

Attn.: Robert W. Lockwood, Esq.
Facsimile No.: (314) 877-7748

If to Vail:

Vail Resorts, Inc. (Delivery other than
137 Benchmark Road mail)
Avon, Colorado 81620

<PAGE> 143

-33-

Vail Resorts, Inc. (Mail Delivery)
Post Office Box 7
Vail, Colorado 81658

Attn.: James S. Mandel, Esq.
Facsimile No.: (970) 845-2912

If to Apollo:

1301 Avenue of the Americas
New York, New York 10019
Attn.: Marc Rowan
Facsimile No.: (212) 261-4071

With a copy to:

James J. Clark, Esq.
Cahill Gordon & Reindel
80 Pine Street
New York, NY 10005

Facsimile No.: (212) 269-5420

The parties to this Agreement will promptly notify each other in
the manner provided in this Section 12.5 of any change in their
respective addresses. A notice of change of address will not be
deemed to have been given until received by the addressee.

Section 12.6 Amendments. No changes,
----------
modifications, amendments or additions will be valid unless such
be made in writing and signed by or on behalf of each party.

Section 12.7 Extended Meanings. Words importing
-----------------
the singular number include the plural and vice versa, and words
importing the masculine gender include the feminine and neuter
genders.

Section 12.8 Successors and Assigns. This
----------------------
Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and permitted
assigns; provided each of Foods and Vail shall have the right
--------
to assign its rights and obligations under this Agreement as a
whole (i) in a transaction pursuant to Section 3.2(b), (g) or (h)
or (ii) to the surviving entity in a merger, consolidation,
combination or other corporate transaction involving it if the
surviving entity agrees in writing to be bound by the terms

<PAGE> 144

-34-

hereof, and Apollo shall have the right to assign its rights and
obligations under this Agreement to any of its Affiliates or in a
bona fide distribution of its assets following dissolution or
liquidation, provided each of the distributees agrees in
--------
writing to be bound by the terms hereof.

Section 12.9 Severability. The invalidity or
------------
unenforceability of any provision hereof in any jurisdiction will
not affect the validity or enforceability of this Agreement,
including that provision, in any other jurisdiction. To the
extent permitted by applicable law, each party waives any
provision of law that renders any provision hereof prohibited or
unenforceable in any respect. If any term, provision, covenant
or restriction in this Agreement is held by a court of competent
jurisdiction to be invalid, void or unenforceable, the parties
hereto will use their best efforts to find and employ an
alternative means to achieve the same or substantially the same
result as that contemplated by such term, provision, covenant or
restriction and the remainder of the terms, provisions, covenants
and restrictions set forth herein shall remain in full force and
effect, in order to achieve the intent of the parties to the
extent possible.

Section 12.10 Counterparts. This Agreement may be
------------
executed simultaneously in two or more counterparts, each of
which is deemed an original, but all of which together constitute
a single agreement, and it is not necessary in making proof of
this Agreement to produce or account for more than one such
counterpart.

Section 12.11 Remedies Cumulative. Except as
-------------------
otherwise expressly limited herein, the remedies given to any
party by this Agreement are in addition to all remedies under any
statute or rule of law. Any forbearance or failure or delay in
exercising any remedy hereunder is not deemed to be a waiver of
any other remedy a party may have under this Agreement.

Section 12.12 Binding Agreement. This Agreement
-----------------
will be deemed effective and legally binding upon the parties
when it has been executed and delivered by all parties hereto.
This Agreement will inure to the benefit of the parties hereto
and their successors and permitted assignees.

Section 12.13 Recapitalizations, Exchanges, Etc.,
-----------------------------------
Affecting Vail Securities. The provisions of this Agreement
- - - -------------------------
apply to the full extent set forth herein with respect to the
Vail Equity, to any and all shares of capital stock of Vail or

<PAGE> 145

-35-

any successor or assign of Vail (whether by merger,
consolidation, sale of assets or otherwise) which may be issued
in respect of or in exchange or substitution for Vail Equity and
will be appropriately adjusted for any stock dividends, splits,
reverse splits, combinations, recapitalizations and the like
occurring after the date hereof.

Section 12.14 Other Agreements. Nothing contained
----------------
in this Agreement will be deemed to be a waiver of, or release
from, any obligations any party hereto may have under any other
agreement, including, without limitation, the Purchase Agreement.

Section 12.15 Termination. This Agreement, and
-----------
all rights and obligations of each party hereto, shall terminate
(i) upon agreement of each of the Shareholders, (ii) upon the
voluntary or involuntary dissolution of Vail, (iii) upon the sale
of all or substantially all of the assets of Vail or upon a
Change of Control of Vail, (iv) when Apollo and its Affiliates
own less than 10% of the shares of Vail Equity owned by Apollo on
the date of this Agreement (adjusted accordingly for any stock
splits, stock dividends or similar recapitalizations by Vail
after the date hereof) or (v) when Foods and its Affiliates own
less than 10% of the outstanding Vail Securities. The provisions
of Article VIII hereof shall survive the termination of this
Agreement.

Section 12.16 Enforcement. Each of Vail, Apollo
-----------
and Foods agree that any breach of the provisions contained in
this Agreement by Vail, Apollo and/or Foods would cause
irreparable harm to the other and its Affiliates and therefore,
notwithstanding any right of Vail, Apollo and/or Foods to recover
monetary damages with respect to any such breach (a) as set forth
in this Agreement or (b) at law, Vail, Apollo and Foods will each
be entitled to equitable relief to enjoin any threatened or
continuing breach of the other hereof and, in the event of any
action for specific performance, each party shall waive the
defense that a remedy at law would be adequate. If the scope of
any restriction contained in this Agreement is too broad to
permit enforcement to its fullest extent, then such restriction
will be enforced to the maximum extent permitted by law in the
manner provided in Section 12.9 hereof. Nothing herein stated
will be construed as prohibiting any party from pursuing any
other remedies available to that party for a breach hereunder,
including recovery of damages.

<PAGE> 146

-36-

Section 12.17 Confidentiality. Each of Foods,
---------------
Apollo and Vail acknowledges that the other would be irreparably
damaged if confidential knowledge of its business and affairs
were disclosed or utilized on behalf of any Person. Each of
Vail, Apollo and Foods covenants and agrees not to disclose or
use any such confidential information of the other unless such
information has been made available to the public generally
(other than in violation of this Section 12.17) or Vail, Apollo
and/or Foods is required to disclose such information by a
governmental body or regulatory agency or by law in connection
with a transaction that is not otherwise prohibited hereby.

Section 12.18 Fiduciary Accounts. Vail, Apollo
------------------
and Foods each acknowledge and agree that this Agreement shall
apply only to the Vail Securities owned by Foods and Apollo for
its own respective account and does not apply to any Vail
Securities which may be deemed to be beneficially owned or
controlled by Foods or their respective Affiliates and which
shares are held in fiduciary accounts in connection with any
pension plans, profit sharing plans or other employee benefit
plans or held in any other fiduciary accounts.

<PAGE> 147
IN WITNESS WHEREOF, the parties have executed this
Agreement by an officer thereunto duly authorized, all as of the
day and year first above written.

VAIL RESORTS, INC.

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

RALSTON FOODS, INC.

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

APOLLO SKI PARTNERS, L.P.

By:
----------------------------
Name:
Authorized Signatory
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.

<ARTICLE> 5
<MULTIPLIER> 1,000,000

<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-START> OCT-01-1995
<PERIOD-END> JUN-30-1996
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 89.3
<ALLOWANCES> 1.8
<INVENTORY> 106.8
<CURRENT-ASSETS> 204.2
<PP&E> 713.7
<DEPRECIATION> 284.1
<TOTAL-ASSETS> 722.8
<CURRENT-LIABILITIES> 114.7
<BONDS> 373.8
<COMMON> .3
0
0
<OTHER-SE> 173.5
<TOTAL-LIABILITY-AND-EQUITY> 722.8
<SALES> 802.8
<TOTAL-REVENUES> 802.8
<CGS> 408.3
<TOTAL-COSTS> 408.3
<OTHER-EXPENSES> 341.4
<LOSS-PROVISION> 1.0
<INTEREST-EXPENSE> 20.2
<INCOME-PRETAX> 31.9
<INCOME-TAX> 12.3
<INCOME-CONTINUING> 19.6
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 19.6
<EPS-PRIMARY> 0.59
<EPS-DILUTED> 0.59

</TABLE>