UNITED STATES
                       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 January 29, 1999

                                       OR 

   []          TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                        Commission File Number: 333-26091

                         BOOTH CREEK SKI HOLDINGS, INC.
             (Exact name of registrant as specified in its charter)

         Delaware                                             84-1359604
(State or Other Jurisdiction                               (I.R.S. Employer
of Incorporation or Organization)                       Identification Number)

1000 South Frontage Road West, Suite 100                        81657
           Vail, Colorado                                     (Zip Code)
(Address of Principal Executive Offices)

                                 (970) 476-4030
              (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 [ ]

       As of  February  26,  1999,  the  number  of  shares  outstanding  of the
registrant's Common Stock, par value $.01 per share, was 1,000 shares.


<PAGE>



                                TABLE OF CONTENTS

<TABLE>

<S>                                                                                                 <C>    

Item                                                                                                  Page Number
----                                                             

                         PART I - FINANCIAL INFORMATION

   1.    Financial Statements.............................................................................        1

   2.    Management's Discussion and Analysis of Financial Condition and Results of Operations............        8

   3.    Quantitative and Qualitative Disclosures about Market Risk.......................................       17

                           PART II - OTHER INFORMATION

   1.    Legal Proceedings................................................................................       18

   3.    Defaults Upon Senior Securities..................................................................       20

   6.    Exhibits and Reports on Form 8-K.................................................................       21

Signatures................................................................................................       22


</TABLE>

<PAGE>1


                          PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                         BOOTH CREEK SKI HOLDINGS, INC.

                           CONSOLIDATED BALANCE SHEETS
               (In thousands, except share and per share amounts)

<TABLE>
<S>                                                                       <C>             <C>    

                                                                           January 29,        October 30,
                                                                               1999              1998
                                                                        -----------------   ---------------  
                                ASSETS                                     (Unaudited)

Current assets:
   Cash .............................................................      $       2,214      $         625
   Accounts receivable, net of allowance of $53 and
     $54, respectively...............................................              2,345              1,573
   Inventories.......................................................              5,284              4,370        
   Prepaid expenses and other current assets.........................              2,369              1,377
                                                                        -----------------   -----------------
Total current assets.................................................             12,212              7,945


Property and equipment, net..........................................            159,530            156,469
Real estate held for development and sale............................             10,249             10,155
Deferred financing costs, net of accumulated amortization
   of $2,314 and $1,985, respectively................................              6,523              6,649
Timber rights and other assets.......................................              8,421              7,428

Goodwill, net of accumulated amortization of $4,784 and $4,190,
   respectively......................................................             29,681             29,000
                                                                       -----------------    -----------------
Total assets.........................................................      $     226,616      $     218,546
                                                                       =================    ================= 

                 LIABILITIES AND SHAREHOLDER'S EQUITY

Current liabilities:

   Senior credit facility............................................      $      15,340      $      17,143
   Current portion of long-term debt.................................                989              1,785
   Accounts payable and accrued liabilities..........................             33,494             22,110
                                                                        -----------------   -----------------  
Total current liabilities............................................             49,823             41,038

Long-term debt.......................................................            136,944            137,352

Other long-term liabilities..........................................                177                145


Commitments and contingencies


Preferred stock of subsidiary;  28,000 shares  authorized,  
   20,000 shares issued  and  outstanding  at January 29, 1999  
  (21,000  shares at October 30,  1998);
   liquidation preference
   and redemption value of $2,509 at January 29, 1999................              2,509              2,634


Shareholder's equity:

   Common stock, $.01 par value; 1,000 shares authorized,
     issued and outstanding..........................................                  -                  -
   Additional paid-in-capital........................................             72,000             72,000
   Accumulated deficit...............................................            (34,837)           (34,623)
                                                                           -----------------   -----------------  
Total shareholder's equity...........................................             37,163             37,377
                                                                           -----------------   -----------------  
Total liabilities and shareholder's equity...................              $     226,616      $     218,546
                                                                           =================   =================  
</TABLE>

                             See accompanying notes.


<PAGE>2



                         BOOTH CREEK SKI HOLDINGS, INC.

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                 (In thousands)

<TABLE>
<S>                                                                   <C>                 <C>       

                                                                               Three Months Ended
                                                                         ------------------------------
                                                                         January 29,         January 30,
                                                                             1999               1998
                                                                        --------------     --------------

                                                                                   (Unaudited)

Revenue:
   Resort operations...............................................      $      46,299      $      39,016

Operating expenses:                                                        
   Cost of sales - resort operations...............................             29,289             22,853
   Depreciation....................................................              4,207              3,029
   Amortization of goodwill........................................                594                564  
   Selling, general and administrative expense.....................              7,071              3,949  
                                                                         --------------     --------------                       
Total operating expenses...........................................             41,161             30,395
                                                                         --------------     --------------
                                                                                 
Operating income...................................................              5,138              8,621

Other income (expense):                                              
   Interest expense................................................             (4,968)            (4,087)
   Amortization of deferred financing costs........................               (329)              (279)
   Other income....................................................                  4                  -
                                                                          --------------     --------------         
   Other income (expense), net.....................................             (5,293)            (4,366)

Income (loss) before minority interest.............................               (155)             4,255

Minority interest..................................................                (59)               (70)
                                                                          --------------     --------------
Net income (loss)..................................................      $        (214)     $       4,185
                                                                          ==============     ===============
</TABLE>

                             See accompanying notes.


<PAGE>3



                         BOOTH CREEK SKI HOLDINGS, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)

<TABLE>
<S>                                                                   <C>                 <C>   

                                                                                Three Months Ended
                                                                         -------------------------------
                                                                         January 29,         January 30,
                                                                             1999               1998
                                                                         --------------    --------------
                                                                                   (Unaudited)


Cash flows from operating activities:

Net income (loss).................................................       $        (214)     $       4,185
Adjustment to reconcile net income (loss) to net cash provided by                       
   operating activities:
     Depreciation.................................................               4,207              3,029
     Amortization of goodwill.....................................                 594                564  
     Amortization of deferred financing costs.....................                 329                279
     Minority interest............................................                  59                 70
     Changes in operating assets and liabilities:                                                    
       Accounts receivable........................................                (772)              (110)   
       Inventories................................................                (914)              (906)    
       Prepaid expenses and other current assets..................                (992)            (1,668)
       Accounts payable and accrued liabilities...................              11,384              9,902
       Other long-term liabilities................................                  32                 55
                                                                         --------------      --------------                     
Net cash provided by operating activities.........................              13,713             15,400

Cash flows from investing activities:
Capital expenditures for property and equipment...................              (7,246)            (4,473)
Acquisition of businesses.........................................                (525)                 -
Capital expenditures for real estate held for development
   and sale.......................................................                 (94)                 -
Other assets .....................................................                (865)               439
                                                                          --------------    --------------
Net cash used in investing activities.............................              (8,730)            (4,034)

Cash flows from financing activities:
Net repayments of senior credit facility..........................              (1,803)            (8,500)
Principal payments of long-term debt..............................              (1,204)            (1,681)
Deferred financing costs..........................................                (203)                 -
Purchase of preferred stock of subsidiary and payment of dividends
                                                                                  (184)              (136)
                                                                           --------------    --------------
Net cash used in financing activities.............................              (3,394)           (10,317)
                                                                           --------------    --------------
Increase in cash..................................................               1,589              1,049

Cash at beginning of period.......................................                 625                462
                                                                           --------------    --------------
Cash at end of period.............................................        $      2,214       $      1,511
                                                                           ==============    ==============

</TABLE>

                             See accompanying notes.



<PAGE>4



                   
                         BOOTH CREEK SKI HOLDINGS, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                January 29, 1999


1.   Organization, Basis Of Presentation and Summary of Significant Accounting
     Policies

     Booth Creek Ski Holdings,  Inc. ("Booth Creek") was organized on October 8,
1996 in the State of Delaware for the purpose of acquiring and operating various
ski  resorts,  including   Northstar-at-Tahoe   ("Northstar"),   Sierra-at-Tahoe
("Sierra"),  Bear  Mountain,  Waterville  Valley,  Mt.  Cranmore,  the Summit at
Snoqualmie Pass (the "Summit"), Grand Targhee and Loon Mountain.

     The consolidated  financial  statements include the accounts of Booth Creek
and its subsidiaries  (collectively  referred to as the "Company").  Booth Creek
owns all of the common stock of its subsidiaries. Ski Lifts, Inc. (the owner and
operator of the Summit) has shares of  preferred  stock owned by third  parties.
All significant intercompany transactions and balances have been eliminated.

     Booth Creek is a wholly-owned subsidiary of Booth Creek Ski Group, Inc. 
("Parent").

     The accompanying  consolidated  financial statements as of January 29, 1999
and for the three month  periods ended January 29, 1999 and January 30, 1998 are
unaudited,  but include all adjustments  (consisting  only of normal,  recurring
adjustments) which, in the opinion of management of the Company,  are considered
necessary for a fair presentation of the Company's financial position at January
29, 1999,  and its operating  results and cash flows for the three month periods
ended January 29, 1999 and January 30, 1998. Due to the highly  seasonal  nature
of the Company's  business and the effect of acquisitions  (Note 2), the results
for the interim periods are not necessarily indicative of results for the entire
year. Certain information and footnote  disclosures  normally included in annual
financial  statements  prepared in accordance with generally accepted accounting
principles  have  been  omitted  pursuant  to  generally   accepted   accounting
principles  applicable  for  interim  periods.   Management  believes  that  the
disclosures made are adequate to make the information  presented not misleading.
The unaudited  consolidated  financial  statements should be read in conjunction
with the following notes and the Company's consolidated financial statements and
accompanying  notes included in the Company's Annual Report on Form 10-K for the
year ended October 30, 1998.

Reporting Periods

     The  Company's  reporting  periods end on the Friday  closest to the end of
each month.

Costs of Computer Software Developed or Obtained for Internal Use

     In  March  1998,  the  Accounting   Standards  Executive  Committee  issued
Statement  of  Position  ("SOP")  98-1,  "Accounting  for the Costs of  Computer
Software  Developed  or Obtained  for  Internal  Use." SOP 98-1,  which has been
adopted  prospectively  by the  Company as of October  31,  1998,  requires  the
capitalization  of certain  costs  incurred in  connection  with  developing  or
obtaining internal use software.  Prior to the adoption of SOP 98-1, the Company
expensed development,  production and maintenance costs associated with computer
software  developed  for  internal  use.  The effect of adopting SOP 98-1 was to
increase net income for the three months ended January 29, 1999 by approximately
$56,000.

Use of Estimates

     The  preparation  of financial  statements  in  conformity  with  generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that affect the amounts  reported in the financial  statements  and
accompanying notes. Actual results could differ from those estimates.




<PAGE>5
                         BOOTH CREEK SKI HOLDINGS, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)




2.   Acquisitions

Pro Forma Financial Information

     The Company  acquired  Loon  Mountain on February 26, 1998,  which has been
included in the Company's  results of operations  since the date of acquisition.
The following table represents  unaudited pro forma financial  information which
presents the Company's  consolidated  results of operations for the three months
ended January 30, 1998 as if the Loon Mountain acquisition and related financing
transactions occurred on November 1, 1997.
<TABLE>
<S>                                                                                   <C>  
                                                                                         Three Months Ended
                                                                                          January 30, 1998
                                                                                          -----------------
                                                                                          (In thousands)

     Statement of operations data:

       Revenue................................................                              $    45,773
       Operating income.......................................                              $    10,359
       Net income.............................................                              $     5,326
     Other data:
       EBITDA.................................................                              $    14,548

</TABLE>

     EBITDA represents income from operations before depreciation, depletion and
amortization  expense and the noncash cost of real estate  sales.  EBITDA is not
intended  to  represent  cash flow from  operations  or net income as defined by
generally  accepted  accounting  principles  and should not be  considered  as a
measure of liquidity or an alternative  to, or more meaningful  than,  operating
income  or  operating  cash flow as an  indication  of the  Company's  operating
performance.

     The pro forma information does not purport to be indicative of results that
actually would have occurred had the acquisition been made on the date indicated
or of results which may occur in the future.

Proposed Seven Springs Acquisition

     On August 28,  1998,  the  Company,  Booth Creek Ski  Acquisition,  Inc., a
wholly-owned  subsidiary of Booth Creek  ("Acquisition  Sub"), and Seven Springs
Farm,  Inc.  ("Seven  Springs"),  the owner and  operator  of the Seven  Springs
Mountain  Resort, a ski resort and conference  center in  Pennsylvania,  entered
into an  Agreement  of Merger (the  "Merger  Agreement"),  pursuant to which the
Company would acquire Seven Springs  through the merger of Acquisition  Sub with
and into Seven Springs.  The aggregate merger consideration and related payments
will be  approximately  $83 million plus certain deferred  payments,  subject to
certain  price  adjustments.  The proposed  acquisition  is  conditioned  on the
receipt of a judicial  determination  that the terms of a certain  shareholders'
agreement  among  Seven  Springs  and  its  shareholders   (the  "Seven  Springs
Shareholder  Agreement") does not apply to the transactions  contemplated by the
Merger Agreement,  as well as customary closing  conditions.  In connection with
the proposed acquisition,  certain shareholders of Seven Springs filed a lawsuit
in the  Court of Common  Pleas of  Somerset  County,  Pennsylvania  against  the
Company,  Acquisition  Sub,  and Seven  Springs  and  certain of its  directors,
seeking a declaratory judgment, along with other relief including the rescission
of the Merger  Agreement.  Plaintiffs allege that the terms of the Seven Springs
Shareholder  Agreement  ban the  consummation  of the proposed  acquisition.  On
October 29, 1998, the Court entered a final judgment denying  Plaintiff's motion
and has permitted  the  consummation  of the  transactions  contemplated  by the
Merger Agreement.  On December 28, 1998, the Plaintiff's filed an amended notice
of appeal  which is currently  pending.  While the Company  believes  that Seven
Springs  will  prevail with its  position  that the Seven  Springs  Shareholders
Agreement  does  not  apply  to the  transactions  contemplated  by  the  Merger
Agreement,  no  assurance  can be made  regarding  the timing or outcome of this
litigation.



<PAGE>6

                         BOOTH CREEK SKI HOLDINGS, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)



3.   Accounts Payable and Accrued Liabilities

     Accounts payable and accrued liabilities consist of the following:

<TABLE>
<S>                                                                    <C>                <C>    

                                                                       January 29, 1999    October 30, 1998     
                                                                       ----------------   -----------------
                                                                                    (In thousands)
     Accounts payable.............................................       $    13,440        $    10,652
     Accrued compensation and benefits............................             3,403              3,164
     Taxes other than income......................................             1,431                973
     Unearned income and deposits.................................             6,145              4,017
     Interest.....................................................             6,429              2,349
     Other........................................................             2,646                955
                                                                       -----------------  ------------------
                                                                         $    33,494        $    22,110
                                                                       =================  ==================
</TABLE>


4.   Financing Arrangements

Senior Credit Facility

     The borrowing  availability  under the provisions of the Company's  Amended
and Restated Credit Agreement (the "Senior Credit Facility") is $25 million. The
Senior Credit Facility requires that the Company not have borrowings  thereunder
in excess of $8 million in addition to certain amounts maintained by the Company
in  certain  depository  accounts  with  BankBoston,  N.A.,  for a period  of 60
consecutive  days each year commencing  between  February 1 and February 28. The
Company has  obtained a waiver  from the lender that  reduced the period of time
during  which  borrowings  may not  exceed $8  million  to 20  consecutive  days
commencing  between  February 1 and February 28, 1999,  and waives certain other
covenant violations at January 29, 1999. Total borrowings  outstanding under the
Senior Credit  Facility at January 29, 1999 were  approximately  $15.3  million,
which bore interest at 7.75%.

Long-Term Debt

     As of  January  29,  1999,  the  Company  had  outstanding  $133.5  million
aggregate amount of its senior debt securities (the "Senior Notes").  The Senior
Notes mature on March 15, 2007,  and bear  interest at 12.5% per annum,  payable
semi-annually  on March 15 and September 15. The Senior Notes are  redeemable at
the option of the  Company,  in whole or in part,  at any time  after  March 15,
2002, with an initial  redemption price of 106.25%  declining  through maturity,
plus accrued and unpaid interest to the redemption date.

     The Senior Notes are  unconditionally  guaranteed,  on an unsecured  senior
basis, as to the payment of principal,  premium,  if any, and interest,  jointly
and severally (the "Guarantees"),  by all Restricted Subsidiaries of the Company
(as defined in the Indenture)  having either assets or  shareholders'  equity in
excess of $20,000 (the  "Guarantors").  All of the Company's direct and indirect
subsidiaries  are  Restricted  Subsidiaries,  except the Real Estate  LLC.  Each
Guarantee  is  effectively  subordinated  to all  secured  indebtedness  of such
Guarantor.  The Senior Notes are general  senior  unsecured  obligations  of the
Company  ranking  equally in right of payment with all other existing and future
senior  indebtedness  of the  Company  and  senior  in right of  payment  to any
subordinated indebtedness of the Company.



<PAGE>7

                         BOOTH CREEK SKI HOLDINGS, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)



4.       Financing Arrangements - (Continued)

Long-Term Debt - (Continued)

     The Senior Notes are  effectively  subordinated  in right of payment to all
secured indebtedness of the Company and the Guarantors,  including  indebtedness
under the Senior Credit Facility. In addition, the Senior Notes are structurally
subordinated  to any  indebtedness  of the Company's  subsidiaries  that are not
Guarantors.  The  indenture  for the  Senior  Notes (the  "Indenture")  contains
covenants  for the benefit of the holders of the Senior Notes that,  among other
things,  restrict the ability of the Company and any Restricted Subsidiaries to:
(i) incur additional  indebtedness;  (ii) pay dividends and make  distributions;
(iii) issue stock of subsidiaries; (iv) make certain investments; (v) repurchase
stock; (vi) create liens; (vii) enter into transactions with affiliates,  (viii)
enter  into sale and  leaseback  transactions,  (ix)  create  dividend  or other
payment restrictions affecting Restricted Subsidiaries; (x) merge or consolidate
the Company or any Guarantors; and (xi) transfer and sell assets.

     The Guarantors are wholly-owned  subsidiaries of Booth Creek and have fully
and  unconditionally  guaranteed  the Senior Notes on a joint and several basis.
Booth  Creek is a holding  company and has no  operations,  assets or cash flows
separate from its  investments  in its  subsidiaries.  In addition,  the assets,
equity,  income  and cash  flow of the  Real  Estate  LLC,  Booth  Creek's  only
non-guarantor  subsidiary,  are inconsequential and the common stock of the Real
Estate LLC is entirely  owned by Booth Creek.  Accordingly,  Booth Creek has not
presented  separate  financial  statements and other disclosures  concerning the
Guarantors or its  non-guarantor  subsidiary  because  management has determined
that such information is not material to investors.

5.       Income Taxes

     Due to the  Company's  lack of  profitable  history,  the tax  benefits  of
operating losses are fully offset by a valuation reserve.  Similarly, no federal
income  tax  benefit is  expected  for the year ended  October  29,  1999 due to
continued  operating losses.  Accordingly,  during the quarter ended January 29,
1999, no federal income tax benefit has been provided.

6.       Subsequent Event

     On February 26, 1999,  the Company  experienced  an  electrical  fire which
destroyed  the  restaurant  facility  located  at the  peak of  Northstar's  ski
terrain.   Subject  to  minor  deductibles,   the  property  loss  and  business
interruption are fully covered by insurance.


<PAGE>8






ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
           RESULTS OF OPERATIONS

     The  discussion  and analysis  below  relates to the  historical  financial
statements and historical and pro forma results of operations of the Company and
the liquidity  and capital  resources of the Company.  The following  discussion
should be read in conjunction  with the  consolidated  financial  statements and
related notes thereto included elsewhere in this report.

     Except for  historical  matters,  the matters  discussed in Part I, Item 2.
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations" are forward-looking statements that involve risks and uncertainties.
Forward-looking   statements  are  based  on  management's   current  views  and
assumptions and involve risks and uncertainties that could significantly  affect
expected results.  The Company wishes to caution the reader that certain factors
below could  significantly  and materially  affect the Company's actual results,
causing  results  to  differ  materially  from  those  in  any   forward-looking
statement. These factors include: regional and national economic conditions, the
successful  or  unsuccessful   integration  of  acquired   businesses,   weather
conditions,  natural  disasters  (such as  earthquakes),  industry  competition,
governmental   regulation  and  other  risks   associated   with  expansion  and
development,  the occupancy of leased property and property used pursuant to the
United States Forest Service permits, and the ability of the Company to make its
information  technology  assets and systems year 2000 compliant and the costs of
any modifications necessary in this regard.

General

     The  Company's  ski  operations  are highly  sensitive to regional  weather
conditions  and the overall  strength of the regional  economies in the areas in
which the Company operates.  The Company believes that the geographic  diversity
of the Company's resorts and the use of extensive snowmaking  technology coupled
with advanced trail grooming  equipment,  which together can provide  consistent
skiing  conditions,  can partially  mitigate the risk of both economic downturns
and adverse weather conditions in any given region. However, the Company remains
vulnerable to warm weather, heavy rains and drought conditions, which can have a
significant effect on the operating revenues and profitability at any one of the
Company's resorts.

      The  Company's  four  most   weather-sensitive   resorts,  Bear  Mountain,
Waterville  Valley,  Loon Mountain and Mt.  Cranmore,  have invested  heavily in
snowmaking capabilities to provide coverage on virtually all of their trails and
have been open for skiing at least 123,  144,  145, and 105 days,  respectively,
during  each of the last five ski  seasons.  The  Company's  Northstar,  Sierra,
Summit  and Grand  Targhee  resorts  are less  weather-sensitive  based on their
historical  natural  snowfall,  averaging  approximately  326, 518, 422, and 512
inches of snowfall,  respectively,  per year for the past five ski seasons. As a
result of their historic natural  snowfall,  their  snowmaking  capabilities are
considerably  less  extensive  than at Bear Mountain,  Waterville  Valley,  Loon
Mountain or Mt. Cranmore.

     The  Company's  results of  operations  are also  highly  dependent  on its
ability  to  compete  in each of the  large  regional  ski  markets  in which it
operates. At Northstar and Sierra, more than 70% of the 1997/98 ski season total
skier days were  attributable  to  residents of the San  Francisco,  Sacramento,
Central  California Valley and Lake Tahoe regions.  At Bear Mountain,  more than
90% of the 1997/98 ski season total skier days were attributable to residents of
the Los Angeles and San Diego metropolitan  regions.  At Waterville Valley, Loon
Mountain  and Mt.  Cranmore,  approximately  80% of the 1997/98 ski season total
skier days were  attributable to residents of  Massachusetts  and New Hampshire,
with a large  percentage  of such visitors  coming from the Boston  metropolitan
area. At the Summit, the Company estimates that more than 90% of the 1997/98 ski
season total skier days were  attributable  to  residents of the  Seattle/Tacoma
metropolitan  region. The Company's Grand Targhee resort attracts  approximately
50% of its skiers from outside its local skiing population.

     In addition to revenue  generated  from skiing  operations,  the  Company's
resorts generate significant revenue from non-ski operations, including lodging,
conference  center services,  health and tennis clubs and summer activities such
as mountain biking rentals and golf course fees.

     A significant portion of total operating costs at the Company's resorts are
variable,  consisting  primarily  of  retail  and food  service  cost of  sales,
utilities and labor expense.  These  variable costs can fluctuate  significantly
based upon skier days and other seasonal factors.  With the exception of certain
management,  marketing and maintenance personnel, all of the Company's employees
are compensated on an hourly basis.


<PAGE>9



Results of Operations of the Company

     Overview

     The Company's results of operations are  significantly  impacted by weather
conditions.  Northstar,  Sierra and Grand  Targhee  have  experienced  generally
favorable snow conditions  during the first half of the 1998/99 ski season.  The
Summit has  experienced  a prolonged  period of  continual  snowfall,  which has
resulted  in  increased  snow  removal  and  other  operating  costs.  The  East
experienced mild temperatures through mid December and rainfall on most weekends
during January.  These conditions  negatively impacted snow conditions,  terrain
availability  and  skier  days at  Waterville  Valley,  Mt.  Cranmore  and  Loon
Mountain.  While Bear Mountain enjoyed cold temperatures in early November which
facilitated  an early opening on man-made  snow,  the resort has suffered from a
lack of natural snowfall through the end of January.

     Historical  Three  Months  Ended  January  29,  1999  as  Compared  to  the
Historical Three Months Ended January 30, 1998

     The Company's  results of operations for the historical  three months ended
January 29, 1999  includes the results of all of the  Company's  resorts for the
entire period.  The results of operations for the historical  three months ended
January 30, 1998  excluded the results of Loon  Mountain,  which was acquired on
February 26, 1998.

     Total revenue for the three months ended January 29, 1999 was  $46,299,000,
an increase of  $7,283,000,  or 19%, over the  Company's  revenues for the three
months ended January 30, 1998. The increase is principally  due to the inclusion
of Loon Mountain in the 1999 period,  which  contributed  $5,407,000 in revenues
during the first  quarter of fiscal  1999.  In  addition,  Northstar  and Sierra
generated  additional  revenues of $530,000 and $196,000,  respectively,  due to
improved yields. The Summit generated  $1,503,000 in additional  revenues due to
an earlier opening and improved yields in its food and beverage, snow school and
retail  businesses.  These gains were  partially  offset by reduced  revenues at
Waterville  Valley and Mt.  Cranmore due to  unfavorable  weather  conditions in
December and January.  Bear Mountain realized increased revenues in November due
to an earlier  opening.  However,  the early season gains at Bear  Mountain were
eroded in January due to the continued  lack of natural  snowfall.  Revenues for
Grand Targhee were generally comparable between the periods.

     Total  operating  expenses for the three months ended January 29, 1999 were
$41,161,000,  an increase of  $10,766,000  over the 1998 period.  The  principal
causes of the increase are as follows:
<TABLE>
    <S>                                                                                         <C>        

                                                                                                   (In thousands)

     Total operating expenses - three months ended January 29, 1998..............                  $     30,395
     Acquisition of Loon Mountain:
       Cost of sales - resort operations.........................................                         3,431
       Selling, general and administrative.......................................                           588
       Depreciation and amortization.............................................                           605
                                                                                                 -----------------
                                                                                                          4,624
                                                                                                 -----------------
     Nonrecurring maintenance, operations, snow removal and severance costs, and                
       costs associated with an earlier opening and revenue penetration efforts                 
       and new operations at the Summit..........................................                         1,982
                                                                                                         
     Costs of nonrecurring corporate initiatives and process improvements and costs
       associated with new management personnel and functional expertise.........                         1,236
     Increased depreciation due to higher average asset balances.................                           603
     Increased snowmaking costs at Bear Mountain due to the lack of natural                                
       snowfall..................................................................                           456
     Lease costs for three new lifts at the Summit and Bear Mountain.............                           247
     Labor associated with earlier openings at Northstar, Sierra and                                        
       Bear Mountain.............................................................                           197
     Inflation, consistent accrual practices among resorts and other changes, net                         1,421
                                                                                                   ---------------

     Total operating expenses - three months ended January 29, 1999..............                  $     41,161
                                                                                                   ===============
</TABLE>

<PAGE>10



     As  reflected  above,  the  inclusion  of Loon  Mountain in the 1999 period
resulted  in an  increase  of  $4,624,000  in  expenses  as compared to the 1998
period.

     At the Summit, the Company incurred  significant  nonrecurring costs during
the three months ended January 29, 1999 to appropriately prepare its facilities,
vehicle and snow grooming fleet, communications infrastructure and processes and
systems for the operation of the resort. In addition,  record levels of snowfall
have severely hampered  operating efforts and resulted in significant  increases
in snow removal, grounds maintenance and related costs. The Company also accrued
severance  costs  associated  with  certain  personnel  changes  at the  Summit.
Management  believes that approximately  $1,000,000 of the cost increases at the
Summit are of a nonrecurring  nature and would not be incurred in a typical year
of operation.  Further,  the resort opened thirteen days earlier for the 1998/99
ski season as compared to the prior  season.  Also,  the resort has  implemented
various revenue  penetration  efforts and is operating a new ski school business
that was  previously  operated by a third party,  which have  contributed to the
cost increases at the Summit. The earlier opening,  revenue  penetration efforts
and new ski school have  generated an increase in revenues of $1,503,000 for the
three months ended January 29, 1999 as compared to the 1998 period.

     The Company has been executing numerous nonrecurring efforts to improve its
marketing  collateral and database,  establish  strategic  marketing  alliances,
introduce new service offerings,  install public relations  channels,  implement
enhanced guest service training for employees,  institute performance management
systems and evaluate  technology related tools and methodologies.  Further,  the
Company has been conducting system and process improvements in substantially all
key administrative and operations areas.  Management believes that approximately
$500,000 of the increased  corporate  spending is of a nonrecurring  nature. The
Company has also added certain key corporate personnel and functional  expertise
to enhance  its  management  team.  Management  believes  that the  nonrecurring
initiatives,   process  improvements  and  personnel  additions  have  begun  to
favorably  impact the Company's  operations  through  improved yields and higher
guest service survey scores, and will positively impact the Company's  financial
performance in future periods.

     Interest  expense for the three  months  ended  January  29,  1999  totaled
$4,968,000,  an increase of $881,000 over the Company's interest expense for the
three  months ended  January 30, 1998,  reflecting  generally  higher  levels of
borrowings  in the 1999 period due  principally  to debt incurred to finance the
Loon Mountain acquisition.

     Due to the  Company's  lack of  profitable  history,  the tax  benefits  of
operating losses are fully offset by a valuation reserve.  Similarly, no federal
income  tax  benefit is  expected  for the year ended  October  29,  1999 due to
continued operating losses.  Accordingly,  during the three months ended January
29, 1999, no federal income tax benefit has been provided.

     Historical Three Months Ended January 29, 1999 as Compared to the Pro Forma
Three Months Ended January 30, 1998

     The following  unaudited pro forma results of operations of the Company for
the  three  months  ended  January  30,  1998  assume  that  the  Loon  Mountain
acquisition  and related  financing  had  occurred  on  November 1, 1997.  These
unaudited pro forma results of operations are not necessarily  indicative of the
actual  results  of  operations  that  would  have  been  achieved  nor are they
necessarily indicative of future results of operations.


<PAGE>11


<TABLE>
<S>                                                                      <C>                    <C>  

                                                                            Historical three     Pro forma three
                                                                              months ended        months ended
                                                                           January 29, 1998     January 30, 1998
                                                                            -----------------   ----------------
                                                                                       (In thousands)

     Statement of Operations Data:
       Revenue:
         Resort operations.............................................       $      46,299       $      45,773

       Operating expenses:
         Resort operations.............................................              36,360              31,225
         Depreciation and amortization.................................               4,801               4,189
                                                                              ---------------     -------------
       Operating income................................................               5,138              10,359
       Interest expense and other, net.................................               5,293               4,963
                                                                              ---------------     -------------
       Income (loss) before minority interest..........................                (155)              5,396
       Minority interest...............................................                  59                  70
                                                                              ---------------     -------------
       Net income (loss)...............................................       $        (214)      $       5,326
                                                                              ===============     =============
     Other Data:
       EBITDA..........................................................       $       9,939       $      14,548
</TABLE>


     Total historical  revenues for the three months ended January 29, 1999 were
$46,299,000,  an increase of  $526,000,  or 1%,  over the  comparable  pro forma
period in 1998.  Total skier days for the three  months  ended  January 29, 1999
were 1,046,000,  a decrease of 35,000 days, or 3%, over the comparable pro forma
period in 1998.  Skier day  improvements at the Summit due to an earlier opening
were offset by reduced skier days at the Eastern  resorts.  Northstar and Sierra
generated  increased  revenues of $530,000 and  $196,000,  respectively,  due to
improved  yields.  Revenues  for the Summit  increased by  $1,503,000  due to an
earlier  opening,  increased  skier visits and  improved  yields in its food and
beverage, snow school and retail businesses. Revenues for Waterville Valley, Mt.
Cranmore  and Loon  Mountain  declined by  $408,000,  $129,000  and  $1,359,000,
respectively,  due to poor early  season  conditions  and reduced  skier days at
these  resorts.  The declines in revenues  for the Eastern  resorts due to lower
skier days were partially  offset by improved  yields in ticketing and ancillary
services  such as ski rental,  food and  beverage  and retail  operations.  Bear
Mountain  realized  increased  revenues in November  due to an earlier  opening.
However, the early season gains were eroded in January due to the continued lack
of natural  snowfall.  Revenues  for Grand  Targhee  were  generally  comparable
between the periods.

     Historical   resort   operating   expenses,   excluding   depreciation  and
amortization,  for the three months ended January 29, 1999 were $36,360,000,  an
increase of  $5,135,000,  or 16%, over the  comparable pro forma period in 1998.
Increased  costs of operations at the Summit of $1,982,000 and higher  corporate
expenses  of  $1,236,000  for  nonrecurring   corporate   initiatives,   process
improvements  and new  management  personnel as  previously  discussed  were the
principal  contributors  to the  increase.  Increased  snowmaking  costs at Bear
Mountain of  $456,000  due to the lack of natural  snowfall,  lease costs in the
amount of $247,000 for three new lifts at the Summit and Bear Mountain, $197,000
of incremental labor costs associated with earlier openings at Northstar, Sierra
and Bear  Mountain  and normal  inflationary  impacts  also  contributed  to the
increase.

     Historical depreciation and amortization for the three months ended January
29, 1999 was $4,801,000. The increase of $612,000 or 15% over the 1998 pro forma
period was due to higher average asset balances in the 1999 period.

     Net interest expense for the historical three months ended January 29, 1999
totaled $5,293,000,  an increase of $330,000 or 7% from the comparable pro forma
period  in 1998.  The  increase  was  principally  due to  interest  expense  on
borrowings  under the Senior Credit Facility used to fund capital  expenditures,
maintenance  activities and normal seasonal working capital  requirements in the
off-season period prior to the start of the 1998/99 ski season.


<PAGE>12



Liquidity and Capital Resources

     The Company's  primary  liquidity  needs are to fund capital  expenditures,
service  indebtedness  and support seasonal  working capital  requirements.  The
Company's  primary  sources  of  liquidity  are cash  flow from  operations  and
borrowings  under the Senior  Credit  Facility.  Virtually  all of the Company's
operating income is generated by its subsidiaries.  As a result,  the Company is
dependent on the earnings and cash flow of, and dividends and  distributions  or
advances from, its  subsidiaries to provide the funds necessary to meet its debt
service obligations. The Senior Credit Facility currently provides for borrowing
availability  of up to $25  million  during  the  term of such  facility,  which
expires November 15, 1999. The Senior Credit Facility  requires that the Company
not have borrowings  thereunder in excess of $8 million,  in addition to certain
amounts  maintained  by  the  Company  in  certain   depository   accounts  with
BankBoston,  N.A.,  for a period of 60  consecutive  days  each year  commencing
between  February 1 and  February 28. The Company has obtained a waiver from the
lender that reduces the period of time during which borrowings may not exceed $8
million to 20 consecutive  days commencing  between  February 1 and February 28,
1999,  and waives  certain other  covenant  violations at January 29, 1999.  The
Company  intends to use  borrowings  under the Senior  Credit  Facility  to meet
seasonal  fluctuations in working  capital  requirements,  primarily  related to
off-season  operations  and  maintenance  activities  during  the  months of May
through November,  to fund capital  expenditures for lifts, trail work, grooming
equipment and other  on-mountain  equipment and facilities,  to build retail and
other  inventories  prior to the  start of the ski  season  and for  other  cash
requirements.  As of  January  29,  1999  and  February  28,  1999,  outstanding
borrowings under the Senior Credit Facility totaled  approximately $15.3 million
and $5.8 million, respectively.

     While the Company's ski resorts typically generate  significant  amounts of
cash during the ski season,  the Company had a working  capital deficit of $37.6
million as of January 29, 1999 which will negatively affect liquidity during the
remainder of 1999.

     The Company  generated cash from operating  activities of $13.7 million for
the three  months  ended  January 29, 1999 as compared to $15.4  million for the
three months ended  January 30, 1998.  This decrease is  principally  due to the
reduced  earnings for the quarter ended January 29, 1999 as compared to the 1998
period.

     Cash used in investing  activities  totaled $8.7 million and $4 million for
the three months ended January 29, 1999 and January 30, 1998, respectively.  The
results for the 1999 and 1998 periods primarily reflect capital expenditures for
the purchase of property and equipment.

     Cash used in financing  activities  totaled $3.4 million and $10.3  million
for the three months ended January 29, 1999 and January 30, 1998,  respectively.
The results for the 1999 and 1998 periods  primarily  reflect  repayments on the
Senior Credit Facility and long-term debt.

     The Company's capital expenditures for property and equipment for the three
months  ended  January  29, 1999 were  approximately  $7.2  million.  Management
anticipates  that remaining  capital  expenditures for property and equipment in
fiscal 1999 and fiscal 2000 will be approximately  $14 million in the aggregate,
including  approximately  $4 million in resort  maintenance  for each year.  The
Company  plans to fund these  capital  expenditures  from  available  cash flow,
vendor  financing to the extent  permitted  under the Senior Credit Facility and
the Indenture and borrowings under the Senior Credit  Facility.  Commitments for
future  capital  expenditures  through  fiscal 1999 totaled  approximately  $3.3
million at January 29, 1999.

     Management  believes that there is a considerable  degree of flexibility in
the timing  (and,  to a lesser  degree,  the scope) of its  capital  expenditure
program,  and  even  greater  flexibility  as to  its  real  estate  development
objectives. While the capital expenditure program described above is regarded by
management  as  important,  both as to timing and scope,  discretionary  capital
spending  above  maintenance  levels  can be  deferred,  in some  instances  for
substantial periods of time, in order to address cash flow or other constraints.
With respect to the Company's  potential real estate development  opportunities,
management believes that such efforts will enhance ski-related revenues and will
contribute  independently to earnings. In addition,  with respect to significant
development  projects,  the  Company  anticipates  entering  into joint  venture
arrangements  that would  reduce  infrastructure  and other  development  costs.
Nonetheless,  existing  lodging  facilities  in the  vicinity of each resort are
believed  to be  adequate  to support  current  skier  volumes and a deferral or
curtailment  of  development  efforts is not regarded by management as likely to
adversely  affect  skier days and  ski-related  revenues or  profitability.  The

<PAGE>13


Company also believes that its current  infrastructure  is sufficient,  and that
development of real estate  opportunities is not presently  necessary to support
its existing operations.

     The  Company's  liquidity  has been and will  continue to be  significantly
affected  by its high  leverage.  As a result  of its  leveraged  position,  the
Company  will have  significant  cash  requirements  to  service  debt and funds
available for working capital,  capital  expenditures,  acquisitions and general
corporate  purposes are limited.  In addition,  the Company's high level of debt
may increase its  vulnerability to competitive  pressures and the seasonality of
the skiing and recreational  industries.  Any decline in the Company's  expected
operating  performance  could have a material  adverse  effect on the  Company's
liquidity  and on its  ability to  service  its debt and make  required  capital
expenditures.

     In addition,  the Senior  Credit  Facility and the  Indenture  each contain
covenants that  significantly  limit the Company's  ability to obtain additional
sources of  capital  and may affect the  Company's  liquidity.  These  covenants
restrict the ability of the Company and its  Restricted  Subsidiaries  to, among
other things,  incur additional  indebtedness,  create liens,  make investments,
consummate  certain asset sales,  create  subsidiaries,  issue subsidiary stock,
consolidate or merge with any other person, or transfer all or substantially all
of the  assets  of the  Company.  Further,  upon the  occurrence  of a Change of
Control (as defined in the Indenture), the Company may be required to repurchase
the Notes at 101% of the  principal  amount  thereof,  plus  accrued  and unpaid
interest.  The  occurrence of a Change of Control may also  constitute a default
under the Senior  Credit  Facility.  No assurance  can be given that the Company
would be able to finance a Change of Control repurchase offer.

     The Company  currently has $133.5  million  aggregate  principal  amount of
Senior Notes outstanding, which will result in annual cash interest requirements
of  approximately  $16.7 million.  The Company  expects that cash generated from
operations,  together with borrowing availability,  will be adequate to fund the
interest requirements on the Senior Notes and the Company's other cash operating
and debt service requirements over the next twelve months.  However, any decline
in the Company's  expected  operating  performance could have a material adverse
effect on the Company's  liquidity.  In such case, the Company could be required
to attempt to refinance  all or a portion of its existing  debt,  sell assets or
obtain additional financing.  No assurance can be given of the Company's ability
to do so or the terms of any such  transaction.  In addition,  the Company would
require additional financing for future acquisitions.

Impact of the Year 2000 Issue

     The year 2000 issue is the result of computer  programs being written using
two digits rather than four to define the applicable  year. Any of the Company's
computer programs that have  date-sensitive  software may recognize a date using
"00" as the year 1900 rather than the year 2000.  This could  result in a system
failure or miscalculations causing disruptions of operations,  including,  among
other things, a temporary inability to process  transactions or engage in normal
business activities.

     The  Company  has   conducted  an  assessment   of  its   information   and
telecommunications  technology  ("IT") assets and systems.  Substantially all of
the Company's IT systems,  except for a portion of the  Company's  ticketing and
sales  systems,  operate using  software  developed and supported by third party
vendors.  The Company is in the process of  implementing  its planned program to
remedy  such  third  party   developed   systems,   which  will  entail   either
modifications  to or  replacement  of certain  existing IT systems.  The cost of
modifications   will  be  expensed  as  incurred  and  is  not  expected  to  be
significant.  The cost of  purchased  replacements  will be  capitalized  and is
expected to range from $500,000 to $700,000.

     The Company is currently  performing an assessment of the necessary efforts
to make its primary ticketing and sales system year 2000 compliant,  and expects
to complete this  assessment by April 1999. The cost of necessary  modifications
to the ticketing and sales  software will be expensed as incurred.  Purchases of
replacement  hardware,  if  any,  will  be  capitalized.  The  expected  cost of
necessary  software  modifications  and hardware  replacements  is not currently
known.

     The Company has commenced a program to ensure that significant  vendors and
service  providers  with  which it does  business  are year 2000  compliant.  In
addition,  the Company is conducting  an  assessment of its operating  assets to
determine whether there will be any significant financial impacts to ensure year
2000 compliance for such assets.

<PAGE>14


     The Company  intends to complete its year 2000  assessments and remediation
program by the third calendar  quarter of 1999.  However,  if the Company or its
vendors  are unable to resolve  the year 2000 issue in a timely  manner,  or the
Company's  assessment  of the  extent of year  2000  issues  surrounding  its IT
systems,  operating  assets or  significant  vendors  or service  providers  are
incorrect, the year 2000 issue could have a material impact on the operations of
the Company. The Company does not presently have a contingency plan in the event
its year 2000  compliance  program is  unsuccessful or not completed on a timely
basis.

     The cost of the project and the date on which the Company  believes it will
complete the year 2000  modifications  are based on management's best estimates,
which were derived utilizing  numerous  assumptions of future events,  including
the continued availability of certain resources,  third party modification plans
and other factors.  However, there can be no guarantee that these estimates will
be achieved and actual results could differ  materially from those  anticipated.
Specific factors that might cause such material differences include, but are not
limited to, the  availability  and cost of personnel  trained in this area,  the
ability  to  locate  and  correct  all  relevant   computer  codes  and  similar
uncertainties.

Seasonality

     The business of the Company is highly  seasonal,  with the vast majority of
its annual revenues  expected to be generated between November and April of each
fiscal year.  Management  considers it  essential to achieve  optimal  operating
results  during  key  holidays  and  weekends  during  this  period.  During the
off-season  months of May  through  October,  the  Company's  resorts  typically
experience  a  substantial  reduction  in labor and  utility  expense due to the
absence of ski operations,  but make  significant  expenditures for maintenance,
expansion and capital improvement in preparation for the ensuing ski season.

Regulation and Legislation

     The Company's  operations  are dependent upon its ownership or control over
the real property  constituting each resort. The real property presently used at
the Northstar and Mt. Cranmore resorts is owned by the Company.  The Company has
the right to use a substantial  portion of the real property associated with the
Bear  Mountain,  Sierra,  Summit,  Grand  Targhee,  Loon Mountain and Waterville
Valley  resorts  under the terms of  Special  Use  Permits  issued by the United
States Forest  Service.  The Special Use Permits for the Bear Mountain,  Sierra,
Waterville  Valley,  the Summit and Grand  Targhee  resorts were reissued at the
time of the Company's acquisition of such resorts, with the Bear Mountain permit
expiring in 2020,  the Sierra permit  expiring in 2008,  the  Waterville  Valley
permit  expiring  in 2034,  the  Summit  permit  expiring  in 2032 and the Grand
Targhee permit expiring in 2034.

     A  substantial  portion  of the  real  property  associated  with  the Loon
Mountain resort is likewise used under United States Forest Service permits.  In
1993,  the United  States Forest  Service  authorized  various  lift,  trail and
snowmaking  improvements  on Loon Mountain and an expansion onto South Mountain.
In 1996,  the United  States Court of Appeals for the First  Circuit (the "First
Circuit")  overturned  this  authorization  on the ground that the United States
Forest Service had failed to properly address certain environmental issues under
the National Environmental Policy Act ("NEPA"). Certain improvements,  including
a snowmaking pipeline, and part of the expansion had been constructed before the
First Circuit ruled.  On May 5, 1997,  the United States  District Court for the
District of New Hampshire  (the  "District  Court")  entered a stipulated  order
which  authorized  existing   improvements  to  remain  in  place  and  existing
operations to continue but generally prohibited future construction,  restricted
use of a major  snowmaking  water source,  and required  certain water discharge
permits to be pursued,  pending United States Forest Service  reconsideration of
the projects under NEPA. In a December 4, 1998 filing,  the United States Forest
Service  targeted  the  Fall of 1999  for  issuance  of a  draft  NEPA  document
regarding  the  improvements  and the  proposed  expansion  and  stated  that it
intended to combine  such NEPA review  with  review of the  existing  snowmaking
pipeline.  The  District  Court  entered  a final  order on  December  11,  1998
specifying that the conditions imposed on operations at Loon Mountain in the May
5, 1997  order will  remain in effect  until the United  States  Forest  Service
completes its NEPA review and issues a new decision.  On February 12, 1999,  the
District  Court  agreed that the United  States  Forest  Service may combine its
evaluation and analysis of the existing snowmaking pipeline with its NEPA review
of the improvements and proposed expansion.

     In August  1997,  the United  States  Forest  Service  authorized  the Loon

<PAGE>15


Mountain resort to construct a new snowmaking  pipeline  across  permitted land.
The United States Forest  Service found that such  construction  was  consistent
with the  District  Court order and enabled the resort to modify its  snowmaking
operations to better  protect water  resources and replace  snowmaking  capacity
lost  under  the  order.  Although  the  pipeline  was  completed,  its  use was
challenged by private parties who asserted that the United States Forest Service
violated NEPA. On January 20, 1998, the District Court issued a decision finding
that the United  States Forest  Service  violated NEPA in failing to address the
potential  for the new  pipeline  to  increase  the  amount of snow made and any
associated environmental effects. On March 10, 1998, the District Court issued a
series of further  orders which,  among other  things,  direct the United States
Forest Service to re-evaluate the pipeline,  allow such re-evaluation to proceed
separate from and prior to the United States Forest Service's reconsideration of
the  larger  expansion,  and  enjoin  the Loon  Mountain  Resort  from using the
pipeline pending further action by the court. On July 2, 1998, the United States
Forest Service  issued a new decision  approving the pipeline and addressing its
potential to increase the amount of snow made.  This decision was  challenged by
several private parties,  who again,  asserted that it violated NEPA. The United
States  Forest  Service  subsequently  withdrew  its  decision  authorizing  the
pipeline to conduct  further  review and the  District  Court  consolidated  the
lawsuits  concerning  the  pipeline.  On November 19, 1998,  the District  Court
modified the  injunction  precluding use of the pipeline to permit Loon Mountain
Resort to use the  pipeline to withdraw  and convert  159.7  million  gallons of
water per ski season into snow while the United  States Forest  Service  further
reviews the  pipeline  under NEPA.  On February 12,  1999,  the  District  Court
dismissed  the  consolidated  lawsuit  concerning  the  pipeline in light of the
United  States Forest  Service's  decision to combine  review of the  pipeline's
construction and operation with its NEPA review of the improvements and proposed
expansion.

     Existing  use of Loon  Mountain  is  authorized  under a Term  Special  Use
Permit,  which covers facilities and expires in 2006, and a supplemental permit,
which  covers the balance of Loon  Mountain;  existing  non-skiing  use of South
Mountain is authorized under an annual permit issued by the United States Forest
Service  that is  expected  to be reissued  each year.  After the United  States
Forest Service  reconsiders the pipeline  improvements and expansion under NEPA,
it will need to render a new decision and, if  appropriate,  issue a new permit.
At that time, the District Court order will  terminate.  Based upon the existing
administrative  record,  and  certain  proposed  modifications  to the  resort's
snowmaking operations which are intended to better protect water resources,  the
Company expects that the pipeline improvements and expansion will be approved by
the United States Forest Service.  However,  no assurance can be given regarding
the timing or outcome of this process.

     The United  States  Forest  Service has the right to approve the  location,
design and  construction of  improvements  in permit areas and many  operational
matters at resorts with permits.  Under the permits,  the Company is required to
pay  fees  to  the  United  States  Forest  Service.   Under  recently   enacted
legislation,  retroactively  effective to the 1995/96 ski season, the fees range
from 1.5% to  approximately  4.0% of certain  revenues,  with the rate generally
rising with increased revenues.  Through fiscal 1998, the Company is required to
pay the greater of (i) the fees due under the new  legislation and (ii) the fees
actually  paid for the 1994/95 ski season  unless gross  revenue in a ski season
falls more than 10% below that of the  1994/95 ski season in which case the fees
due are calculated  solely under the new  legislation.  The calculation of gross
revenues  includes,  among other  things,  revenue from lift ticket,  ski school
lesson, food and beverage,  rental equipment and retail merchandise sales. Total
fees paid to the United  States  Forest  Service by the Company  during the year
ended October 30, 1998 were  $1,014,000.  The new legislation is not expected to
have a material effect on fees payable in future periods.

     The Company  believes  that its  relations  with the United  States  Forest
Service are good,  and, to the best of its knowledge,  no Special Use Permit for
any major ski  resort  has ever been  terminated  by the  United  States  Forest
Service. Prior to permit termination,  the United States Forest Service would be
required  to notify the Company of the grounds for such action and to provide it
with reasonable time to correct any curable non-compliance.

     The Company's  resorts are subject to a wide variety of federal,  state and
local laws and  regulations  relating to land use, water  resources,  discharge,
storage,  treatment and disposal of various  materials  and other  environmental
matters.  Management  believes  that the  Company's  resorts  are  presently  in
compliance with all land use and environmental laws, except where non-compliance
is not  expected  to  result  in a  material  adverse  effect  on its  financial
condition.  The Company  also  believes  that the cost of  complying  with known
requirements,  as well as anticipated  investigation and remediation activities,
will not have a material  adverse  effect on its  financial  condition or future
results of operations. However, failure to comply with such laws could result in
the imposition of severe penalties and other costs or restrictions on operations
by government agencies or courts that could adversely affect operations.


<PAGE>16



     The  operations at the resorts  require  permits and approvals from certain
federal, state and local authorities.  In addition, the Company's operations are
heavily dependent on its continued ability, under applicable laws,  regulations,
policies,  permits,  licenses  or  contractual  arrangements,  to have access to
adequate  supplies  of water with which to make snow and service the other needs
of its  facilities,  and  otherwise to conduct its  operations.  There can be no
assurance that new applications of existing laws,  regulations and policies,  or
changes in such laws,  regulations  and policies will not occur in a manner that
could  have a  detrimental  effect on the  Company,  or that  material  permits,
licenses or agreements  will not be canceled,  not renewed,  or renewed on terms
materially  less favorable to the Company.  Major  expansions of any one or more
resorts could require, among other things, the filing of an environmental impact
statement or other documentation with the United States Forest Service and state
or local  governments under NEPA and certain state or local NEPA counterparts if
it is  determined  that the  expansion  may have a  significant  impact upon the
environment.  Although  the Company has no reason to believe that it will not be
successful in implementing  its operations and  development  plans, no assurance
can be given that necessary permits and approvals will be obtained.

     The Company has not  received  any notice of material  non-compliance  with
permits,  licenses or approvals necessary for the operation of its properties or
of any material liability under any environmental law or regulation. However, at
Grand Targhee,  the Wyoming Department of Environmental  Quality (the "DEQ") has
issued the Resort a Notice of  Violation of state water  pollution  requirements
based on  alleged  discharge  from a  wastewater  lagoon  without a permit.  The
Company has entered into an negotiated  compliance  order with the DEQ requiring
construction  and  operation  of  a  new  wastewater   facility  at  a  cost  of
approximately  $1  million.   The  Company  has   substantially   completed  the
construction  of the new  wastewater  facility and is awaiting final approval of
the facility by the DEQ.

     Pursuant to the air emissions  reduction program currently in effect in the
area regulated by the South Coast Air Quality Management  District in California
where Bear  Mountain  is  located,  Bear  Mountain  will be  required  to "bank"
emission credits from other facilities which have already  implemented  nitrogen
oxide emission reductions. The Company may purchase "banked" emission credits in
a one-time  transaction at the current market rate of approximately  $700,000 or
over time up to the year 2010 at prevailing market rates.

     Bear  Mountain has a water supply  contract for 500 acre-feet per year with
Big Bear  Municipal  Water  District  executed  January  8,  1988,  the  initial
fifteen-year  term of which expires on January 7, 2003. Big Bear Municipal Water
District's  primary  source of water is from a portion  of the water in Big Bear
Lake shared with Bear Valley  Mutual  Water  Company,  the senior  water  rights
holder.  The water supply contract  provides for water primarily for snow making
and slope  irrigation  purposes.  The  obligation  of Big Bear  Municipal  Water
District to supply  water is excused  only if the level of Big Bear Lake recedes
below  6,735.2 feet above sea level or eight feet below the top of Big Bear Lake
Dam. Bear Valley Mutual Water  Company  recently  claimed that its rights in the
lake are not subject to Big Bear Municipal Water District's obligation to supply
water to Bear  Mountain.  This claim is vigorously  contested by all  interested
parties including Bear Mountain and a two-year moratorium agreement between Bear
Valley Mutual Water Company and Big Bear  Municipal  Water District was executed
in November  1998,  which  withdraws Bear Valley's claim for two years while the
issues  between Bear Valley and Big Bear  Municipal  are worked out. This allows
continued service to Bear Mountain on an uncontested basis during the moratorium
period.  The Company  expects  that the issue will be resolved  favorable to the
interests of Bear Mountain because of its contribution to the local economy, the
strength of its contract  rights with Big Bear Municipal  Water District and the
alternate  sources of water  supply that are  available.  It should be noted the
foregoing  is  premised  on normal  conditions  prevailing  and the  absence  of
droughts,  earthquakes,  dam failure or other types of similar  calamities  that
impact the ability to obtain or supply water. No assurance can be made regarding
the outcome of this  situation  or the timing  negotiations  during the next two
years.

     Pursuant to the decision of the First Circuit and the order of the District
Court the Loon  Mountain  Resort  has  applied to the  Environmental  Protection
Agency  ("EPA")  for a Clean  Water Act (the "CWA")  discharge  permit  covering
discharges associated with its snowmaking operations. Certain ongoing discharges
are  authorized  by the District  Court order pending final action on the permit
and subject to the District  Court's  reserved  power to modify such approval to
address any resulting  environmental  issues.  The EPA issued a discharge permit
prior to the 1998/99 ski season.

     Certain regulatory approvals associated with the new snowmaking pipeline at
Loon Mountain impose minimum stream flow  requirements on Loon Mountain  Resort.

<PAGE>17


These  requirements  will compel Loon Mountain Resort to construct water storage
facilities within the next ten years, and such construction will require further
regulatory approvals and environmental documentation under NEPA.

     In addition,  the Loon Mountain  Resort was notified in September 1997 that
it had allegedly  filled certain wetlands at the resort in violation of the CWA.
In response,  the Loon Mountain Resort worked with the EPA to remove the alleged
fill and implement  certain  erosion control  measures.  On January 15, 1998, an
individual notified the EPA, the Loon Mountain Resort, and certain other persons
that he  intended  to  initiate a lawsuit  under the CWA  regarding  the alleged
wetland violation. On February 2, 1998, the EPA wrote to such individual stating
that the alleged fill had been  removed and that the EPA does not believe  there
is a  continuing  violation  at the site.  The Company does not have any further
notice of a threatened action since the September 1997 notice. While the Company
believes  that such position  would prevail in any lawsuit,  no assurance can be
given regarding any outcome.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISLCOSURES ABOUT MARKET RISK

     There have been no material changes in information  relating to market risk
since the Company's  disclosure  in Item 7a. of the  Company's  Annual Report on
Form 10-K for the year ended October 30, 1998 as filed with the  Securities  and
Exchange Commission.



<PAGE>18





                           PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

     Each of the  Company's  resorts  has pending  and is  regularly  subject to
litigation with respect to personal injury claims relating principally to skiing
activities  at its  resorts.  The  Company  and  each  of its  resorts  maintain
extensive  liability  insurance  that the Company  considers  adequate to insure
claims related to usual and customary risks associated with the operation of ski
resorts. The Company does not believe that it or any of its resorts are involved
in any litigation that will,  individually or in the aggregate,  have a material
adverse effect on its financial condition or future results of operations.

     On March 25, 1997, Killington West, Ltd., a California corporation formerly
known as Bear Mountain, Ltd. ("Killington"),  filed a breach of contract lawsuit
in the  Superior  Court of the State of  California  (County of San  Bernardino)
against  Fibreboard  Corporation  ("Fibreboard")  and Bear  Mountain,  Inc.  The
lawsuit  alleges that  Fibreboard and Bear Mountain,  Inc.  breached a change in
control  provision in the asset  purchase  agreement  dated October 6, 1995 (the
"Original  Bear  Mountain  Agreement")  among  Killington,  Fibreboard  and Bear
Mountain, Inc., pursuant to which Bear Mountain, Inc. acquired the Bear Mountain
ski resort from Killington. In connection with the Company's acquisition of Bear
Mountain,   Inc.  in  December  1996,  the  Company   obtained  from  Fibreboard
indemnification  for any claim that might be made by  Killington,  and  further,
required  that $1 million of the  purchase  price be held in escrow  pending the
outcome of any potential  disputes with Killington.  Fibreboard has acknowledged
its obligation to indemnify  Bear Mountain,  Inc. with respect to the Killington
lawsuit and has  commenced  the defense of such lawsuit on behalf of  Fibreboard
and Bear  Mountain,  Inc.,  however,  no assurances  can be given  regarding the
outcome of this litigation.

     In connection with the Loon Mountain acquisition, certain shareholders (the
"Plaintiffs")  of Loon Mountain  Recreation  Corporation  filed  lawsuits in New
Hampshire state court against Loon Mountain Recreation  Corporation ("LMRC") and
its former  directors,  alleging  breach of  fiduciary  duty,  and  against  the
Company,  alleging  that the  Company  failed to comply  with the New  Hampshire
Security Takeover Disclosure Act (the "Takeover  Statute").  Prior to the filing
of the lawsuit  against the  Company,  the Company had sought and received a "no
action" order from the Bureau of Securities Regulation, New Hampshire Department
of State (the "Bureau")  finding that the Takeover  Statute was  inapplicable to
the proposed merger. The two lawsuits were consolidated in the Superior Court in
Grafton County, New Hampshire. The Plaintiffs' initial request for a preliminary
injunction  prohibiting the Company (or its affiliates) from proceeding with the
Loon Mountain Acquisition based on allegations that the Company failed to comply
with the Takeover Statute was denied on October 28, 1997.  Before the litigation
proceeded  further,  both parties amended the merger  agreement  relating to the
Loon  Mountain  Acquisition.  The Company then sought and obtained an additional
order by the Bureau  that the  Takeover  Statute  did not apply.  On January 30,
1998, the Company filed its answer to the Plaintiffs'  petition and, on February
10,  1998,  filed a motion to dismiss the action  against the Company  under the
Takeover  Statute in its  entirety,  asserting,  inter alia,  that the  Takeover
Statute did not apply to the  transaction  as a matter of law. On June 11, 1998,
the Court denied the Company's  motion to dismiss.  On July 2, 1998, the Company
filed a motion to reconsider the Court's decision.  On August 1, 1998, the Court
granted the  Company's  motion for  reconsideration  and  dismissed  Plaintiffs'
claims under the Takeover Statute. Plaintiffs filed a motion for reconsideration
as to the Court's  dismissal of the Takeover  Statute  claim which was denied on
October 1, 1998,  and  Plaintiffs  have appealed the dismissal of their Takeover
Statute  claim  to the  New  Hampshire  Supreme  Court.  Plaintiffs'  breach  of
fiduciary duty action against LMRC and its directors remains pending. Plaintiffs
have conducted  limited discovery and a trial date has not been set. On December
15, 1998,  Plaintiffs moved to amend their complaint to allege a cause of action
seeking money damages  against the Company,  LMRC and the former LMRC  directors
for breach of fiduciary duty and omissions and  misrepresentations in connection
with the  approval of the Loon  Mountain  acquisition  and the  solicitation  of
proxies  from the LMRC  shareholders  to approve  the  transaction.  Plaintiffs'
potential  remedies include monetary damages for the directors'  alleged failure
to maximize the  consideration to LMRC  shareholders  and/or failing to properly
disclose  material  information to LMRC shareholders in connection with the Loon
Mountain  acquisition.  If Plaintiffs  are  successful in pursuing  their claims
against the former LMRC directors, LMRC has certain indemnity obligations to the
former  directors  and is currently  involved in such  directors'  defense.  The
Company may have available to it as a defense the exclusive remedy provisions of
the New Hampshire  statute on  dissenters'  rights,  which rights,  as described
below,  the Plaintiffs have exercised.  While management of the Company believes
that the former LMRC  directors  will  prevail  against  Plaintiffs'  claims and
appeals,  no assurance can be given regarding the outcome of the above described
litigation.


<PAGE>19



     In connection  with the Loon  Mountain  acquisition,  Plaintiffs  exercised
dissenters'  rights  under  the New  Hampshire  Business  Corporation  Act  (the
"NHBCA"). Under the statutory procedure for settling the Plaintiffs' dissenters'
rights,  LMRC paid  Plaintiffs an aggregate of $34,436,  or $30.61 per share, as
its  estimate  of the fair  value of their  1,125  shares.  Plaintiffs  demanded
additional payments necessary to compensate them for the $71.38 per share price,
plus  interest,  which they have  asserted  as the fair  value of their  shares.
Pursuant to the NHBCA,  LMRC  commenced a proceeding  in the Grafton  County New
Hampshire  Superior  Court on July 20, 1998 seeking a judicial  appraisal of the
value of Plaintiffs' shares in LMRC. On September 30, 1998,  Plaintiffs moved to
dismiss the  appraisal  proceeding  on the grounds that LMRC's  payments to them
were  untimely  and  that  the  accompanying  notice  omitted  certain  required
information.  The court denied the Plaintiff's motion to dismiss on December 14,
1998. LMRC  anticipates  that discovery will commence in the first half of 1999.
While the Company  believes that the amount paid to the Plaintiffs  prior to the
commencement  of the  appraisal  proceeding  represents  the fair value of their
shares, there can be no assurance as to the value which the appraisal proceeding
will assign to the Plaintiffs 1,125 shares.

     In 1995, an individual  sued the United States Forest Service in the United
States  District Court for the District of New Hampshire (the "District  Court")
alleging  that the United  States Forest  Service had violated  NEPA,  the Clean
Water Act (the "CWA"), and an executive order in 1993 approving  improvements to
facilities on Loon  Mountain and an expansion of the Loon Mountain  resort on to
South Mountain.  LMRC and an environmental group intervened.  The District Court
entered summary  judgment for the United States Forest Service on all claims and
the original  plaintiff along with an intervening  party  appealed.  In December
1996,  the United  States  Court of Appeals  for the First  Circuit  (the "First
Circuit")  reversed the District  Court and ruled that the United  States Forest
Service  must  reconsider  certain   environmental  issues  under  the  National
Environmental  Policy Act ("NEPA ") and that LMRC must obtain a discharge permit
under the CWA for certain discharges from its snowmaking system. On May 5, 1997,
later finalized December 11, 1998, the District Court entered a stipulated order
that: enjoins LMRC from any further  construction  implementing the project with
certain  limited  exceptions;  imposes  various  restrictions on LMRC's existing
snowmaking  operations and requires LMRC to apply for a CWA discharge permit for
discharges  of  water  and  any  associated   pollutants   associated  with  its
snowmaking; allows existing construction to remain in place and existing uses to
continue;  requires LMRC to undertake  certain  erosion  control and  monitoring
measures; requires the United States Forest Service to prepare supplemental NEPA
documentation  on the  improvements  and  expansion;  and  reserves the right to
require  restoration  of areas  developed  under the 1993 United  States  Forest
Service decision to their  preexisting  condition if not ultimately  approved by
the United  States  Forest  Service.  This order will remain in effect until the
supplemental  NEPA process is completed  and the United  States  Forest  Service
issues a new special use permit.  The Company has  received a CWA permit for its
snowmaking  system,  and the United States Forest Service  currently  expects to
issue draft NEPA documentation in the Fall of 1999. However, no assurance can be
provided on the timing, terms or outcome of this proceeding.

     Following the First Circuit's decision,  the plaintiffs filed a motion with
the  District  Court  asking  it to  impose  a civil  penalty  under  the CWA of
$5,550,125 and attorney's fees and costs against LMRC for unpermitted discharges
into Loon Pond without a discharge  permit during its  snowmaking  operations in
the 1996/97 ski season and  preceding  years.  The  discharge at issue  involves
water  transfers from the East Branch of the  Pemigewasset  River and drain back
from the snowmaking  system into Loon Pond. In connection with the Loon Mountain
acquisition,   the  Company  obtained  environmental   pollution  insurance  for
$4,500,000 of coverage  above a $1.2 million  deductible to cover any penalties,
fees, and costs that the court assesses against LMRC. LMRC asserted  defenses to
the merits and amount of penalty sought. In a December 11, 1998 final order, the
District Court dismissed the claim for civil penalties and attorney's fees under
the CWA on grounds of  mootness  and  standing.  One of the  plaintiffs  filed a
notice of  appeal on  January  8,  1999 to appeal  the final  order to the First
Circuit but has not yet identified  issues on appeal. No assurances can be given
regarding the outcome of this litigation.

     On August 29,  1997,  the  plaintiffs  filed a second  lawsuit  against the
United  States  Forest  Service in the District  Court  alleging that the United
States Forest Service violated NEPA in authorizing LMRC to construct and operate
a snowmaking  pipeline  across  permitted  land.  Another  party  intervened  as
plaintiff,  and LMRC  intervened as defendant.  The United States Forest Service
and LMRC asserted various defenses. On January 20, 1998, the District Court held
that the  pipeline  may be analyzed  and  approved by the United  States  Forest
Service separately from the South Mountain expansion, but that the United States
Forest Service violated NEPA by failing to consider the potential  environmental
effects of the alleged increase in snowmaking  capacity.  On March 10, 1998, the
District Court issued a series of further orders which  establish a schedule for
the United  States  Forest  Service's  reconsideration  of the  pipeline and any
resulting  challenges,  deny plaintiffs'  request that such  reconsideration  be

<PAGE>20


deferred  until the  United  States  Forest  Service's  decision  on the  larger
expansion,  and enjoin Loon  Mountain  from using the pipeline  pending  further
action by the Court.  Three of the plaintiffs have appealed the District Court's
denial of their claim that reconsideration of the pipeline be deferred until the
United States Forest Service's decision on the larger expansion, but briefing on
these appeals has not yet commenced in the First Circuit.

     On July 2, 1998,  the United  States Forest  Service  issued a new decision
reauthorizing the pipeline and addressing the potential environmental effects of
the projected  increase in snowmaking  capacity.  Three of the prior  plaintiffs
filed  challenges to this decision  with the District  Court,  alleging that it,
too, violated NEPA. The United States Forest Service  subsequently  withdrew its
decision authorizing the pipeline to conduct further review under NEPA.

     On August 20, 1998, two of the  plaintiffs  who have  challenges to the new
pipeline  decision  pending before the District Court,  filed a separate lawsuit
against  the United  States  Forest  Service in the same court  challenging  the
pipeline  decision  on the same  grounds,  as well as  additional  grounds  that
another party has asserted in that case or that are identical to claims that the
District Court  addressed in its January 20, 1998  decision.  The District Court
consolidated  the new  lawsuit  with the  existing  action  on the  pipeline  on
November 19, 1998.  That same day, the District  Court  modified the  injunction
precluding  Loon Mountain from using the pipeline to permit Loon Mountain to use
the  pipeline to withdraw  and convert  159.7  million  gallons of water per ski
season  into  snow  until  the  United  States  Forest  Service   completes  its
environmental  review of the  pipeline.  On December 4, 1998,  the United States
Forest Service filed a Notice of  Administrative  Action stating that it intends
to  combine  its  NEPA  review  of the  pipeline  with the  NEPA  review  of the
improvements and proposed  expansion at Loon Mountain.  The United States Forest
Service currently expects to release a draft NEPA document for public comment on
the  pipeline,  the  improvements,  and the proposed  expansion in Fall 1999. No
assurances  can be given  regarding the timing or outcome of this process or the
litigation on the pipeline.

     The plaintiffs in the Loon Mountain  pipeline  litigation  have stated that
they  intend  to seek  attorney  fees in the  combined  amount of  $52,965.  One
plaintiff  has indicated  that he will claim $23,581 in attorney's  fees against
LMRC on grounds of bad faith. The other plaintiffs have not ruled out claims for
attorney's fees against LMRC. The Company believes LMRC has substantial defenses
in the event claims for attorney's fees are filed,  however, it cannot guarantee
any particular result.

     On August 1,  1997,  two  plaintiffs  filed a lawsuit  against  the Town of
Lincoln  Planning Board (the "Lincoln  Planning  Board") and LMRC in the Grafton
County  Superior  Court in the State of New Hampshire  alleging that the Lincoln
Planning Board had improperly  approved various  facilities  associated with the
snowmaking  pipeline.  On September  30, 1997,  LMRC moved to dismiss the claims
against it, but sought to remain in the case as in intervenor. Also on September
30, 1997, the Lincoln Planning Board answered the complaint, denying most of the
allegations  and raising  various  defenses.  On February  23,  1998,  the court
granted LMRC's motion to dismiss.  However, in the event that the plaintiffs are
successful,  the Lincoln  Planning  Board would be requested to  reconsider  the
facilities  and issue a new decision.  No assurance  can be given  regarding the
outcome or timing of this  litigation or any resulting  Lincoln  Planning  Board
review.

     In connection with the Seven Springs  acquisition  certain  shareholders of
Seven Springs  filed a lawsuit in the Court of Common Pleas of Somerset  County,
Pennsylvania against the Company, Acquisition Sub, and Seven Springs and certain
of its  directors,  seeking a  declaratory  judgment,  along with  other  relief
including  the  rescission  of the Merger  Agreement  by and among the  Company,
Acquisition Sub and Seven Springs. Plaintiffs allege that the terms of the Seven
Springs  Shareholder  Agreement  ban  the  consummation  of  the  Seven  Springs
acquisition.  On October 29, 1998,  the court entered a final  judgment  denying
Plaintiff's  motion  and has  permitted  the  consummation  of the  transactions
contemplated  by the Merger  Agreement.  On December 28, 1998,  the  Plaintiff's
filed an amended notice of appeal which is currently pending.  While the Company
believes  that Seven  Springs  will  prevail  with its  position  that the Seven
Springs Shareholders  Agreement does not apply to the transactions  contemplated
by the  Merger  Agreement,  no  assurance  can be made  regarding  the timing or
outcome of this litigation.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

     There has been no material  default  with  respect to any of the  Company's
senior securities which has not been waived or cured.


<PAGE>21



     ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

     a. Exhibits

     Exhibit No.                                        Description of Exhibit

         10                                          Waiver    Agreement   dated
                                                     March 12,  1999,  to Credit
                                                     Agreement   dated   as   of
                                                     October   30,   1998  among
                                                     Booth  Creek Ski  Holdings,
                                                     Inc.,   Booth   Creek   Ski
                                                     Acquisition Corp.,  Trimont
                                                     Land               Company,
                                                     Sierra-at-Tahoe, Inc., Bear
                                                     Mountain,  Inc., Waterville
                                                     Valley  Ski  Resort,  Inc.,
                                                     Mount  Cranmore Ski Resort,
                                                     Inc.,   Ski  Lifts,   Inc.,
                                                     Grand Targhee Incorporated,
                                                     LMRC  Holding  Corp.,  Loon
                                                     Mountain         Recreation
                                                     Corporation,   Loon  Realty
                                                     Corp. and BankBoston, N.A.

         27                                          Financial Data Schedule

     b. Reports on Form 8-K

     No reports on Form 8-K were filed during the quarterly period ended January
29, 1999.


<PAGE>22



                                   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.

                                              BOOTH CREEK SKI HOLDINGS, INC.
                                                     (Registrant)


                                        By: /s/ ELIZABETH J. COLE
                                            ---------------------------------   
                                            Elizabeth J. Cole
                                            Executive Vice President and
                                            Financial Officer


                                        By: /s/ BRIAN J. POPE 
                                            ---------------------------------  
                                               Brian J. Pope
                                            Vice President of Accounting and 
                                             Finance,
                                            (Chief Accounting Officer)



March 12, 1999