===============================================================================

                                 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 28, 2000

                                       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,                  81657
                  Suite 100                         (Zip Code)
               Vail, Colorado
       (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  25,  2000,  the  number  of  shares  outstanding  of  the
registrant's  Common  Stock,  par  value  $.01 per  share,  was  1,000  shares.

===============================================================================
<PAGE>

                               TABLE OF CONTENTS



Item                                                            Page Number
----                                                            -----------

                         PART I - FINANCIAL INFORMATION

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

 2.   Management's Discussion and Analysis of Financial
      Condition and Results of Operations.........................    9

 3.   Quantitative and Qualitative Disclosures about
      Market Risk.................................................   19

                          PART II - OTHER INFORMATION

 1.   Legal Proceedings...........................................   20

 6.   Exhibits and Reports on Form 8-K............................   22

Signatures........................................................   23
<PAGE>

                         PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                         BOOTH CREEK SKI HOLDINGS, INC.

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


                                                  January 28,     October 29,
                                                      2000           1999
                                                --------------- ---------------
                  ASSETS                          (Unaudited)

Current assets:
  Cash .......................................  $         1,796 $           461
  Accounts receivable, net of allowance of
   of $66 and $65, respectively...............            1,878           1,709
  Insurance proceeds receivable...............            6,092           1,799
  Inventories ................................            3,714           2,786
  Prepaid expenses and other current
   assets ....................................            2,588           1,032
                                                --------------- ---------------
Total current assets .........................           16,068           7,787

Property and equipment, net ..................          155,491         152,316
Real estate held for development and sale ....            8,828           8,851
Deferred financing costs, net of
  accumulated amortization of $3,313 and
  $3,078, respectively .......................            5,869           6,071
Timber rights and other assets ...............            8,016           7,246
Goodwill, net of accumulated amortization
  of $7,171 and $6,581, respectively .........           27,482          28,075
                                                --------------- ---------------
Total assets .................................  $       221,754 $       210,346
                                                =============== ===============

   LIABILITIES AND SHAREHOLDER'S EQUITY

Current liabilities:
  Senior credit facility ....................   $        12,568 $        23,035
  Current portion of long-term debt .........             2,064           1,468
  Accounts payable and accrued liabilities ..            47,862          28,593
                                                --------------- ---------------
Total current liabilities ...................            62,494          53,096

Long-term debt ..............................           137,621         136,483

Other long-term liabilities .................                50              50

Commitments and contingencies

Preferred stock of subsidiary; 28,000
  shares authorized, 16,000 shares issued
  and outstanding at January 28, 2000
  (17,000 shares at October 29, 1999);
  liquidation preference and redemption
  value of $2,007 at January 28, 2000 .......             2,007           2,133

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 .......................           (52,418)        (53,416)
                                                --------------- ---------------
Total shareholder's equity ..................            19,582          18,584
                                                --------------- ---------------
Total liabilities and shareholder's
  equity ....................................   $       221,754 $       210,346
                                                =============== ===============

                            See accompanying notes.
<PAGE>

                         BOOTH CREEK SKI HOLDINGS, INC.

                     CONSOLIDATED STATEMENTS OF OPERATIONS
                                 (In thousands)


                                              Three Months Ended
                                          --------------------------
                                           January 28,   January 29,
                                               2000         1999
                                          ------------   -----------
                                                   (Unaudited)

Revenue:
  Resort operations....................     $ 43,869       $ 46,299
  Real estate and other................          845              -
                                          ------------   -----------
                                              44,714         46,299

Operating expenses:
  Cost of sales - resort operations....       26,145         29,289
  Cost of sales - real estate and
   other...............................          333              -
  Depreciation.........................        4,887          4,207
  Amortization of goodwill and other
   intangible assets...................          606            594
  Selling, general and administrative
   expense.............................        6,650          7,071
                                          ------------   -----------
Total operating expenses...............       38,621         41,161
                                          ------------   -----------

Operating income.......................        6,093          5,138

Other income (expense):
  Interest expense.....................       (4,825)        (4,968)
  Amortization of deferred financing
   costs...............................         (235)          (329)
  Other income.........................           12              4
                                          ------------   -----------
  Other income (expense), net..........       (5,048)        (5,293)
                                          ------------   -----------
Income (loss) before minority interest.        1,045           (155)

Minority interest......................          (47)           (59)
                                          ------------   -----------
Net income (loss)......................     $    998       $   (214)
                                          ============   ===========

                            See accompanying notes.
<PAGE>

                         BOOTH CREEK SKI HOLDINGS, INC.

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)


                                                       Three Months Ended
                                                -------------------------------
                                                 January 28,       January 29,
                                                    2000               1999
                                                -------------     -------------
                                                          (Unaudited)

Cash flows from operating activities:
Net income (loss) .............................   $     998         $    (214)
Adjustments to reconcile net income (loss) to
  net cash provided by operating activities:
   Depreciation................................       4,887             4,207
   Amortization of goodwill and other
    intangible assets .........................         606               594
   Noncash cost of real estate sales ..........         331                 -
   Amortization of deferred financing costs ...         235               329
   Minority interest ..........................          47                59
   Changes in operating assets and liabilities:
    Accounts receivable .......................        (169)             (772)
    Insurance proceeds receivable..............      (4,293)                -
    Inventories ...............................        (928)             (914)
    Prepaid expenses and other current assets..      (1,556)             (992)
    Accounts payable and accrued liabilities...      18,219            11,384
    Other long-term liabilities ...............           -                32
                                                -------------     -------------
Net cash provided by operating activities......      18,377            13,713

Cash flows from investing activities:
Capital expenditures for property and
 equipment ....................................      (5,251)           (7,246)
Acquisition of businesses .....................           -              (525)
Capital expenditures for real estate
 held for development and sale ................        (308)              (94)
Other assets ..................................         267              (865)
                                                -------------     -------------
Net cash used in investing activities .........      (5,292)           (8,730)

Cash flows from financing activities:
Net repayments of senior credit facility ......     (10,467)           (1,803)
Principal payments of long-term debt ..........      (1,077)           (1,204)
Deferred financing costs ......................         (33)             (203)
Purchase of preferred stock of subsidiary
 and payment of dividends .....................        (173)             (184)
                                                -------------     -------------
Net cash used in financing activities .........     (11,750)           (3,394)
                                                -------------     -------------
Increase in cash ..............................       1,335             1,589

Cash at beginning of period ...................         461               625
                                                -------------     -------------
Cash at end of period ......................... $     1,796       $     2,214
                                                =============     =============

                            See accompanying notes.
<PAGE>

                         BOOTH CREEK SKI HOLDINGS, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                January 28, 2000


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

    Booth Creek Ski Holdings,  Inc.  ("Booth Creek") owns and operates  various
ski  resorts,  including  Northstar-at-Tahoe   ("Northstar"),   Sierra-at-Tahoe
("Sierra"),  Bear Mountain,  Waterville  Valley,  Mt.  Cranmore,  the Summit at
Snoqualmie  (the "Summit"),  Grand Targhee and Loon Mountain.  Booth Creek also
conducts certain real estate development activities, primarily at Northstar.

    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 28, 2000
and for the three month periods ended January 28, 2000 and January 29, 1999 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 28, 2000, and its operating  results and cash flows for the three month
periods ended January 28, 2000 and January 29, 1999. Due to the highly seasonal
nature of the Company's  business,  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 fiscal year ended October 29,
1999.

Reporting Periods

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

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.

2.  Insurance Proceeds Receivable

    For the 1999/00 ski season, the Company has arranged for four separate paid
skier visit insurance  policies covering its Lake Tahoe resorts  (Northstar and
Sierra),  the New Hampshire resorts  (Waterville  Valley, Mt. Cranmore and Loon
Mountain), Bear Mountain and the Summit. The policies have a deductible for the
initial  decline  from  targeted  paid skier visit  levels,  coinsurance  for a
portion  of the next 10%  decline in paid skier  visits,  and a stated  maximum
coverage  level.  The policies  provide  coverage for  substantially  all risks
relating to paid skier visit levels, including weather perils, road and airport
closures,  downturns in the economy,  strikes and most other events that reduce
the targeted  number of paid skier  visits.  In the  accompanying  consolidated
financial statements as of and for the three months ended January 28, 2000, the
Company has recorded a receivable and resort  operating  revenues of $5,000,000
for expected  claims  proceeds  attributable  to the decline from targeted paid
skier visits for the three months ended January 28, 2000. This estimate assumes
that targeted policy levels of paid skier visits are achieved for the Company's
second  fiscal  quarter  ending April 28,  2000.  In the event that actual paid
skier  visits for the  Company's  second  fiscal  quarter of 2000  differ  from
targeted policy levels, the eventual claim under the paid skier visit insurance
policies  could be higher or lower than the  $5,000,000  estimated  claim as of
January 28, 2000.
<PAGE>

                        BOOTH CREEK SKI HOLDINGS, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


    Also  included in insurance  proceeds  receivable as of January 28, 2000 is
$1,092,000  due for  reconstruction  of the  restaurant  facility at the top of
Northstar's terrain,  which was destroyed in an electrical fire on February 26,
1999.

3.  Accounts Payable and Accrued Liabilities

    Accounts payable and accrued liabilities consist of the following:

                                                      January 28,  October 29,
                                                         2000         1999
                                                      -----------  -----------
                                                           (In thousands)

     Accounts payable ............................    $   14,715  $   10,072
     Accrued compensation and benefits ...........         3,903       3,279
     Taxes other than income .....................         1,710       1,099
     Unearned revenue and deposits - resort
       operations ................................        11,419       9,887
     Unearned revenue - real estate operations....         7,050           -
     Interest ....................................         6,735       2,492
     Other .......................................         2,330       1,764
                                                      ----------  ----------
                                                      $   47,862  $   28,593
                                                      ==========  ==========

4.  Financing Arrangements

Senior Credit Facility

    The  total  maximum  borrowing  availability  under the  provisions  of the
Company's  Amended and Restated Credit Agreement (the "Senior Credit Facility")
is $25 million.  The final maturity date of the Senior Credit Facility is March
31,  2002.  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 Fleet  National
Bank (formerly BankBoston, N.A.), for a period of 60 consecutive days each year
commencing  between  February 1 and February 28. Total  borrowings  outstanding
under the Senior Credit Facility at January 28, 2000 were  approximately  $12.6
million, which bore interest at an annual rate of 8.5% on such date.

Long-Term Debt

    As of  January  28,  2000,  the  Company  had  outstanding  $133.5  million
aggregate  principal 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.
<PAGE>

                        BOOTH CREEK SKI HOLDINGS, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


    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 DRE, 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.

    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 DRE,  LLC,  Booth  Creek's only  non-guarantor
subsidiary,  are  inconsequential  and the common stock of DRE, 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.

    During the three months ended  January 28, 2000,  the Company  entered into
long-term debt and capital lease  obligations of $2,811,000 for the purchase of
equipment.

5.  Northstar Real Estate Sales

    On November 17, 1999,  the Company,  through its  wholly-owned  subsidiary,
Trimont Land Company  ("TLC"),  consummated  the sale of certain  single family
development  property located at Northstar (the "Unit 7 and 7A Development") to
Trimont Land Holdings, Inc. ("TLH"), a wholly-owned subsidiary of Parent and an
affiliate of the Company,  for an aggregate sales price of $7,050,000,  subject
to adjustment as described  below. The  consideration  paid to TLC consisted of
$6,000,000  in cash and a  promissory  note (the "TLH  Note")  for a minimum of
$1,050,000.  Under the terms of the TLH Note,  TLC will  receive the greater of
(a)  $1,050,000  plus  accrued  interest  at 7% per annum,  or (b) the Net Cash
Proceeds of the resale of the lots within the Unit 7 and 7A  Development.  "Net
Cash Proceeds" is defined as gross proceeds received by TLH from the subsequent
resale of the lots,  after deduction for (1) the proceeds  applied to repay any
indebtedness  incurred by TLH in connection  with its financing of the purchase
of the lots, (2) any fees or other costs incurred by TLH in connection with its
financing of the purchase or sales of the lots, and (3) any corporate  overhead
costs incurred by TLH attributable to the purchase,  maintenance,  marketing or
sale of the lots.  The TLH Note is  prepayable  at any time,  and is due on the
earlier to occur of January  30, 2001 or the date on which the last of the lots
owned by TLH has been  sold.  Pursuant  to the terms of the  sale,  TLC has (1)
retained  the  obligation  to  complete  the  scheduled   construction  of  the
development in accordance with the tentative site development  plan, and (2) an
option to repurchase  the Unit 7 and 7A  Development  from TLH.  Northstar will
recognize revenue and related cost of sales for these real estate  transactions
upon the substantial completion of construction and the close of escrow for the
sales between TLH and third party buyers.
<PAGE>

                        BOOTH CREEK SKI HOLDINGS, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


    The Company  has  reached an  agreement  for the  proposed  sale of certain
developmental   real  estate  (the  "Joint  Venture   Development   Property"),
consisting of approximately  250 acres of land at Northstar,  to a newly formed
joint venture between the Company and East West Partners, Inc. ("East West"), a
Colorado  based real estate  development  firm.  The  proposed  transaction  is
subject to a number of significant closing  conditions,  including (1) required
consents and approvals,  including those of certain of the Company's  creditors
and (2) completion of title evaluations and subdivision  requirements to effect
the transfer of the Joint Venture Development Property.  Under the terms of the
proposed transaction, the Company would receive an upfront cash payment ranging
from  $10  million  to $15  million  depending  on the  amount  of real  estate
transferred  at the initial  closing  (with the  remainder  of the upfront cash
payment being paid upon the subsequent  transfer of parcels not  transferred at
the  initial  closing),  and  additional  payments  based on gross sales of the
developed  real  estate as well as a 20%  interest  in the joint  venture.  The
Company  is  required  to invest $5  million of the $15  million  upfront  cash
payment in capital improvements to the Northstar resort.  Additionally,  in the
event  the  planned  transaction  with East West is  consummated,  the  Company
anticipates using a portion of the proceeds  therefrom to repurchase the Unit 7
and 7A Development  property from TLH. The Company has retained approval rights
over  certain  components  of the  master  development  plan  for the  proposed
development.  There can be no assurances that the conditions to the transaction
will be  satisfied or that the  transaction  will be  consummated  on the terms
described or at all.

6.  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 income
tax benefit is expected  for the year ended  October 27, 2000 due to  continued
operating  losses.  Accordingly,  during the quarter ended January 28, 2000, no
income tax provision has been provided.

7.  Business Segments

    The Company currently operates in two business segments,  Resort Operations
and Real Estate and Other. Data by segment is as follows:

                                           Three Months Ended
                                       -------------------------
                                       January 28,   January 29,
                                           2000          1999
                                       -----------   -----------
                                             (In thousands)
  Revenue:
   Resort operations ..............    $    43,869   $    46,299
   Real estate and other ..........            845             -
                                       -----------   -----------
                                       $    44,714   $    46,299
                                       ===========   ===========

  Operating income:
   Resort operations...............    $     5,581   $     5,138
   Real estate and other ..........            512             -
                                       -----------   -----------
                                       $     6,093   $     5,138
                                       ===========   ===========
<PAGE>

                        BOOTH CREEK SKI HOLDINGS, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


                                       January 28,   October 29,
                                           2000          1999
                                       -----------   -----------
                                             (In thousands)
  Identifiable assets:
   Resort operations...............    $   198,843   $   188,870
   Real estate and other ..........         13,340        13,363
                                       -----------   -----------
                                       $   212,183   $   202,233
                                       ===========   ===========

    A reconciliation  of combined  operating  profits for Resort Operations and
Real Estate and Other to consolidated income before income taxes is as follows:

                                          Three Months Ended
                                       -------------------------
                                       January 28,   January 29,
                                           2000          1999
                                       -----------   -----------
                                             (In thousands)

   Total profit for reportable
     segments .....................    $     6,093    $    5,138
   Interest expense................         (4,825)       (4,968)
   Amortization  of  deferred
     financing costs ..............           (235)         (329)
   Other income (expense)..........             12             4
                                       -----------   -----------
   Income (loss) before minority
     interest......................    $     1,045   $      (155)
                                       ===========   ===========
<PAGE>

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

    The discussion  and analysis  below relates to the historical  consolidated
financial  statements and  historical  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.  The  following
discussion contains certain  forward-looking  statements that involve risks and
uncertainties.  The Company's actual results could differ materially from those
discussed herein. Factors that could cause or contribute to the differences are
discussed in "Forward-Looking Statements" and elsewhere in this report.

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 and other types of
severe or unusual weather  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,  143,  142,  and 103  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 367, 546,
493, and 544 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,  and therefore,  such resorts are more
dependent  upon early  season  snowfall  to provide  necessary  terrain for the
important Christmas holiday period.

    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 1998/99 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 1998/99 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, more than 70% of the 1998/99 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 1998/99 ski season total skier days were  attributable  to residents of the
Seattle/Tacoma metropolitan region. The Company's Grand Targhee resort attracts
more than 40% 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  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>

Results of Operations of the Company

    Overview

    The Company's results of operations are  significantly  impacted by weather
conditions.  Northstar and Sierra  experienced  unseasonably  dry weather and a
lack of  natural  snowfall  during  November  and  December  of 1999.  However,
snowfall for these resorts  returned to more normal levels during January 2000.
Bear Mountain  experienced a lack of natural  snowfall during the first half of
the  1999/00 ski season due to dry  weather in  Southern  California.  The East
experienced  variable  temperatures  and a lack of natural snowfall through the
middle of January 2000, although conditions began to improve in the second half
of  January.   These  conditions   negatively  impacted  terrain  availability,
snowmaking  conditions  and  skier  days at the  Company's  California  and New
Hampshire resorts during the Company's first fiscal quarter of 2000. The Summit
experienced  generally  favorable snow conditions  during the first half of the
1999/00  ski  season.  Grand  Targhee  had a delayed  opening due to lower than
expected  levels of natural  snowfall  through early  December  1999,  however,
increased  snowfall during the remainder of December 1999 and January 2000 have
returned snow conditions to more typical levels.

    Three Months  Ended  January 28, 2000 as Compared to the Three Months Ended
January 29, 1999

    Total revenue for the three months ended January 28, 2000 was  $44,714,000,
a decrease of  $1,585,000,  or 3%, from the  Company's  revenues  for the three
months  ended  January 29,  1999.  Revenues  from resort  operations  decreased
$2,430,000, or 5%, for the 2000 period as compared to the 1999 period. Revenues
from real estate  operations  for the three months ended  January 28, 2000 were
$845,000,  which was due to the closing of escrow on three lots within Phases 4
and 4A of the Big Springs development located at Northstar.

    For the 1999/00 ski season, the Company introduced new aggressively  priced
season pass products at Sierra, Bear Mountain, Waterville Valley, Mt. Cranmore,
Loon Mountain,  the Summit and Grand Targhee,  which were designed to stimulate
demand and take advantage of off-peak capacity.  This initiative resulted in an
increase  of  approximately  $7,100,000  in the total  amount  of  season  pass
products  sold for the  1999/00  season when  compared  to the 1998/99  season.
Revenues  from these season pass products are  recognized  ratably over the ski
season,  and increased by  approximately  $3,100,000 for the three months ended
January 28, 2000 as compared to the 1999 period.

    Due to the unfavorable  weather and terrain conditions  experienced by most
of the Company's  resorts during the first half of the 1999/00 ski season,  the
Company  experienced  significant  declines in both paid and total skier visits
during the three months  ended  January 28, 2000 as compared to the same period
in 1999.  In addition,  as  anticipated,  the Company has  experienced  a shift
between paid skier visits and season pass visitation due to the introduction of
new season pass products at most of the Company's  resorts.  Total skier visits
declined by 18% for the 2000 period as compared to the 1999 period,  while paid
skier visits declined by 27%.

    For the 1999/00 ski season, the Company has arranged for four separate paid
skier visit insurance  policies covering its Lake Tahoe resorts  (Northstar and
Sierra),  the New Hampshire resorts  (Waterville  Valley, Mt. Cranmore and Loon
Mountain), Bear Mountain and the Summit. The policies have a deductible for the
initial  decline  from  targeted  paid skier visit  levels,  coinsurance  for a
portion  of the next 10%  decline in paid skier  visits,  and a stated  maximum
coverage  level.  The policies  provide  coverage for  substantially  all risks
relating to paid skier visit levels, including weather perils, road and airport
closures,  downturns in the economy,  strikes and most other events that reduce
the targeted  number of paid skier  visits.  For the three months ended January
28, 2000, the Company has recorded a receivable and resort  operating  revenues
of $5,000,000 for expected  claims  proceeds  attributable  to the decline from
targeted  paid skier visits for the three months ended  January 28, 2000.  This
estimate
<PAGE>

assumes that  targeted  policy levels of paid skier visits are achieved for the
Company's second fiscal quarter ending April 28, 2000. In the event that actual
paid skier visits for the Company's  second fiscal  quarter of 2000 differ from
targeted policy levels, the eventual claim under the paid skier visit insurance
policies  could be higher or lower than the  $5,000,000  estimated  claim as of
January 28, 2000.

    Excluding the effects of paid skier visit insurance,  Northstar, Sierra and
Bear Mountain  experienced  declines in resort  revenues for the 2000 period as
compared  to  the  1999  period  of   $2,566,000,   $2,580,000  and  $1,873,000
respectively,  which was due primarily to reduced  skier  visits.  Revenues for
Waterville  Valley,  excluding  the  effects  of paid  skier  visit  insurance,
declined by $1,106,000  for the 2000 period,  of which  $635,000 was due to the
conversion of the resort's retail  operations to a  concessionaire  arrangement
for the 1999/00 ski season, with the remaining shortfall due primarily to lower
skier visits.  Revenues for Loon Mountain,  excluding the effects of paid skier
visit  insurance,  increased  by $312,000 due  primarily to higher  season pass
revenues,  which offset declines in paid skier visits, lift ticket revenues and
other ski related  revenues  experienced  as a result of the poor early  season
conditions.   The  Summit  generated   $463,000  in  additional   revenues  due
principally  to increased  season pass revenue,  which was partially  offset by
decreased lift ticket revenue. Revenues for Mt. Cranmore, excluding the effects
of paid skier visit  insurance,  and Grand  Targhee were  generally  comparable
between the periods.

    Cost of sales for resort  operations for the three months ended January 28,
2000 were  $26,145,000,  a decrease of  $3,144,000,  or 11%, as compared to the
1999  period.  The decline was  primarily  due to the  combined  effects of the
following:  (1) lower business volumes and aggressive  variable cost management
at most of the resorts,  (2) elimination of certain  nonrecurring  maintenance,
operations,  snow removal and other costs at the Summit, and (3) elimination of
$400,000 in retail costs of sales at Waterville Valley due to the conversion of
the resort's retail operations to a concessionaire  arrangement for the 1999/00
ski season.  Selling,  general and administrative expenses for the three months
ended  January 28, 2000 were  $6,650,000,  a decrease  of  $421,000,  or 6%, as
compared to the 1999 period.  The decrease was due to reduced corporate general
and  administrative  costs coupled with efforts to maintain marketing and sales
costs at historical levels at all of the Company's resorts.

    Cost of sales for real estate  operations  was  $333,000  for the three lot
closings which occurred during the 2000 period,  including  $331,000 of noncash
cost of real estate sales.

    Interest  expense for the three  months  ended  January  28,  2000  totaled
$4,825,000,  a decrease of $143,000 from the Company's interest expense for the
three months ended January 29, 1999.

    Due to the  Company's  lack of  profitable  history,  the tax  benefits  of
operating losses are fully offset by a valuation reserve.  Similarly, no income
tax benefit is expected  for the year ended  October 27, 2000 due to  continued
operating losses. Accordingly,  during the three months ended January 28, 2000,
no income tax provision has been provided.

    "EBITDA"   represents  income  from  operations  before   depreciation  and
amortization  expense and the noncash cost of real estate sales. EBITDA for the
three months ended January 28, 2000 was $11,917,000,  an increase of $1,978,000
or 20% over EBITDA of $9,939,000 for the three months ended January 29, 1999.

    Three Months  Ended  January 29, 1999 as Compared to the 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  was  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 1998 and January 1999. Bear Mountain realized  increased
revenues in November 1998 due to an
<PAGE>

earlier opening.  However,  the early season gains at Bear Mountain were eroded
in the  following  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:

                                                       (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

   Additional 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 new 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
                                                         ==========

    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  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. Further, the resort opened thirteen days earlier for the
1998/99  ski  season  as  compared  to  the  prior  season.  Also,  the  resort
implemented  various revenue  penetration efforts and began operating a new ski
school  business  that  was  previously   operated  by  a  third  party,  which
contributed to the cost increases at the Summit.  The earlier opening,  revenue
penetration  efforts  and new ski school  generated  an increase in revenues of
$1,503,000  for the three months ended January 29, 1999 as compared to the 1998
period.

    During fiscal 1999, the Company  initiated  various  efforts to improve its
marketing  collateral and database,  establish strategic  marketing  alliances,
introduce   new  service   offerings,   evaluate   potential   revenue   growth
opportunities  and strategies,  install public  relations  channels,  implement
enhanced guest service training for employees, institute performance management
systems and  evaluate  technology  related  tools and  methodologies.  Further,
during  the  1999  period  the  Company  was  conducting   system  and  process
improvements in substantially all key  administrative and operations areas. The
Company also added certain key corporate  personnel  and  functional  expertise
during the 1999 period to enhance its management team.

    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 income
tax benefit was recognized for the year ended October 29, 1999 due to
<PAGE>

continued operating losses. Accordingly,  during the three months ended January
29, 1999, no income tax provision was provided.

    EBITDA for the three  months  ended  January  29,  1999 was  $9,939,000,  a
decrease of $2,275,000 or 19% over EBITDA of  $12,214,000  for the three months
ended January 30, 1998.

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,  as amended and restated on
January  28,  1999  and  May  18,  1999,   currently   provides  for  borrowing
availability  of up to $25  million  during  the term of such  facility,  which
expires March 31, 2002.  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 Fleet
National Bank (fomerly  BankBoston,  N.A.), for a period of 60 consecutive days
each year commencing between February 1 and February 28. 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 and to build retail and other inventories
prior to the start of the skiing season and for other cash requirements.  As of
January 28, 2000 and February 25, 2000, outstanding borrowings under the Senior
Credit  Facility  totaled   approximately   $12.6  million  and  $2.2  million,
respectively.

    On November 17, 1999,  the Company,  through its  wholly-owned  subsidiary,
Trimont Land Company  ("TLC"),  consummated  the sale of certain  single family
development  property located at Northstar (the "Unit 7 and 7A Development") to
Trimont Land Holdings, Inc. ("TLH"), a wholly-owned subsidiary of Parent and an
affiliate of the Company,  for an aggregate sales price of $7,050,000,  subject
to adjustment as described  below. The  consideration  paid to TLC consisted of
$6,000,000  in cash and a  promissory  note (the "TLH  Note")  for a minimum of
$1,050,000.  The  proceeds of the sale were  applied  against  the  outstanding
borrowings  under the Senior  Credit  Facility  in order to provide the Company
with additional  liquidity for early 1999/00 ski season  operations.  Under the
terms of the TLH Note,  TLC will  receive  the greater of (a)  $1,050,000  plus
accrued interest at 7% per annum, or (b) the Net Cash Proceeds of the resale of
the lots within the Unit 7 and 7A  Development.  "Net Cash Proceeds" is defined
as gross proceeds received by TLH from the subsequent resale of the lots, after
deduction for (1) the proceeds  applied to repay any  indebtedness  incurred by
TLH in connection  with its financing of the purchase of the lots, (2) any fees
or other costs incurred by TLH in connection with its financing of the purchase
or sales of the lots,  and (3) any  corporate  overhead  costs  incurred by TLH
attributable to the purchase,  maintenance,  marketing or sale of the lots. The
TLH Note is  prepayable  at any  time,  and is due on the  earlier  to occur of
January  30,  2001 or the date on which  the last of the lots  owned by TLH has
been  sold.  Pursuant  to the  terms  of the  sale,  TLC has (i)  retained  the
obligation  to  complete  the  scheduled  construction  of the  development  in
accordance  with the tentative  site  development  plan,  and (ii) an option to
repurchase  the Unit 7 and 7A  Development  from TLH.  Northstar will recognize
revenue and related cost of sales for these real estate  transactions  upon the
substantial  completion of  construction  and the close of escrow for the sales
between TLH and third party buyers.

    The Company had a net working capital  deficit of $35.0 million  (including
$12.6 million in outstanding  borrowings under the Senior Credit Facility,  and
excluding $11.4 million of unearned revenue and deposits from resort operations
for  deferred  season  pass  and  loyalty  membership  product  sales,  lodging
deposits,  prepaid ticket vouchers and other advance product sales,  which will
not require cash spending to settle such  liabilities)  as of January 28, 2000,
which will negatively affect liquidity during the remainder of 2000.

    The Company  generated cash from operating  activities of $18.4 million for
the three  months ended  January 28, 2000 as compared to $13.7  million for the
three months ended January 29, 1999.  This increase is  principally  due to the
sale of the Unit 7 and 7A Development to TLH as previously discussed.

    Cash used in investing activities totaled $5.3 million and $8.7 million for
the three months ended January 28, 2000 and January 29, 1999, respectively. The
results for the 2000 and 1999 periods  primarily  reflect capital
<PAGE>

expenditures for the purchase of property and equipment.

    Cash used in financing  activities  totaled  $11.8 million and $3.4 million
for the three months ended January 28, 2000 and January 29, 1999, respectively.
The results for the 2000 and 1999 periods primarily  reflect  repayments on the
Senior Credit Facility and long-term debt.

    The Company's  capital  expenditures  for property and equipment during the
three months ended January 28, 2000 were  approximately $8.1 million (including
$2.8 million of equipment acquired through capital lease arrangements and other
debt). Based on the Company's existing operations,  management anticipates that
remaining  capital  expenditures  for property and equipment in fiscal 2000 and
fiscal 2001 will be approximately  $14 million to $16 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 for the Company's  Senior Notes and  borrowings  under the Senior
Credit Facility.

    There were no significant  commitments  for future capital  expenditures at
January 28, 2000.  However,  the Company has an early  buy-out  option that has
been extended to April 28, 2000 for the purchase of three high speed detachable
quad lifts that were  installed at the Summit and Bear Mountain at the start of
the  1998/99 ski  season.  The lifts were  obtained  under an  operating  lease
arrangement.  In the event the early buy-out  option is exercised,  the Company
would be required to pay approximately $4.5 million to purchase the lifts.

    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.  As a result of the Company's  recent  operating  performance  and
liquidity  constraints,  it may be required to defer or abandon  certain of its
capital expenditure projects.

    With  respect  to  the   Company's   potential   real  estate   development
opportunities,  management believes that such efforts would enhance ski-related
revenues and 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
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, among other things,  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  non-guarantor,  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.
<PAGE>

    The Senior Credit Facility also requires the Company to maintain  specified
consolidated financial ratios and satisfy certain consolidated financial tests.
The  Company's  ability to meet these  financial  covenants  may be affected by
events beyond its control,  and there can be no assurance that the Company will
meet those covenants.

    The  Company   reached   agreement   for  the  proposed   sale  of  certain
developmental   real  estate  (the  "Joint  Venture   Development   Property"),
consisting of approximately  250 acres of land at Northstar,  to a newly formed
joint venture between the Company and East West Partners, Inc. ("East West"), a
Colorado  based real estate  development  firm.  The  proposed  transaction  is
subject to a number of significant closing  conditions,  including (1) required
consents and approvals,  including those of certain of the Company's  creditors
and (2) completion of title evaluations and subdivision  requirements to effect
the transfer of the Joint Venture Development Property.  Under the terms of the
proposed transaction, the Company would receive an upfront cash payment ranging
from  $10  million  to $15  million  depending  on the  amount  of real  estate
transferred  at the initial  closing  (with the  remainder  of the upfront cash
payment upon the subsequent  transfer of parcels not transferred at the initial
closing),  and  additional  payments based on gross sales of the developed real
estate as well as a 20% interest in the joint venture.  The Company is required
to invest $5  million  of the $15  million  upfront  cash  payment  in  capital
improvements to the Northstar  resort.  Additionally,  in the event the planned
transaction  with East West is  consummated,  the Company  anticipates  using a
portion of the proceeds  therefrom to repurchase  the Unit 7 and 7A Development
property  from TLH.  The  Company has  retained  approval  rights over  certain
components of the master development plan for the proposed  development.  There
can be no assurances that the conditions to the  transaction  will be satisfied
or that the transaction will be consummated on the terms described or at all.

    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,  cash  proceeds of planned  real  estate  sales at
Northstar  and  planned  divestitures  of other real  estate and  non-strategic
assets,  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,
for the twelve  months ended January 28, 2000,  the  Company's  ratio of EBITDA
before unusual items to interest  expense was 1.63, and as of January 28, 2000,
the ratio of the Company's  total debt to EBITDA  before  unusual items for the
last twelve months was 5.10.  For the twelve months ended January 28, 2000, the
Company's  earnings would have been  inadequate to cover fixed charges by $17.6
million.  Any decline in the Company's  expected  operating  performance or the
failure to sell real estate at Northstar  or achieve  planned  divestitures  of
other  real  estate  and  non-strategic  assets,  in  each  case  on the  terms
anticipated,  could have a material  adverse effect on the Company's  financial
position and liquidity.  In such case, the Company could be required to attempt
to refinance all or a portion of its existing debt, sell other 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  expansion of its existing  properties or for future
acquisitions,  if any. No assurances can be given that any such financing would
be available on commercially reasonable terms. See "Forward-Looking Statements"
herein.

    The Company believes that inflation has had little effect on its results of
operations  and any  impact  on costs  has been  largely  offset  by  increased
pricing.

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.

    In prior years, the Company  discussed the nature and progress of its plans
to become  year  2000  compliant.  In late  1999,  the  Company  completed  its
remediation  and  testing  of  systems.  As a  result  of  those  planning  and
implementation  efforts, the Company experienced no significant  disruptions in
mission critical information technology and non-information  technology systems
and believes those systems successfully responded to the year
<PAGE>

2000 date change.  The Company expended  approximately  $800,000 during 1999 in
connection  with  remediating  its  systems.  The  Company  is not aware of any
material  problems  resulting from year 2000 issues,  either with its services,
its  internal  systems,  or the products  and  services of third  parties.  The
Company will continue to monitor its mission critical computer applications and
those of its suppliers and vendors  throughout the year 2000 to ensure that any
latent year 2000 matters that may arise are addressed.

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.  The  Company's
results of  operations  are,  in turn,  significantly  dependent  on  favorable
weather conditions and other factors beyond the Company's control.  The Company
has sought to mitigate the downside risk of its seasonal business by purchasing
paid skier day insurance  policies for the 1999/00 ski season.  However,  these
policies would not fully protect the Company against poor weather conditions or
other factors that adversely affect the Company's operations.

    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 Term Special Use Permits issued by the United
States Forest  Service.  The Bear Mountain  permit  expires in 2020, the Sierra
permit  expires in 2039,  the  Waterville  Valley permit  expires in 2034,  the
Summit permit expires in 2032 and the Grand Targhee permit expires 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.  These   authorizations   and
limitations were incorporated into the final order issued by the District Court
on December 11, 1998,  and 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  this NEPA  review with its  evaluation  and  analysis of the  existing
snowmaking  pipeline.  On December 13, 1999,  the United States Forest  Service
announced  that it expects to issue the draft NEPA  documentation  by June 2000
and the final NEPA documentation by November 2000.

    In August  1997,  the United  States  Forest  Service  authorized  the Loon
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 March 10, 1998, the District Court issued a series of
further  orders which,  among other  things,  directed the United States Forest
Service to re-evaluate  the pipeline and enjoined 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,
which was  challenged by several  private  parties,  who again asserted that it
violated  NEPA.  The United
<PAGE>

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  allowing Loon Mountain 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 issued a final order, which dismissed the
consolidated  lawsuit  concerning  the  pipeline in light of the United  States
Forest  Service's  decision  to conduct  further  review of the  pipeline,  and
specified that the limitation on pipeline usage will continue until that review
is completed  and a new decision is issued.  On January 28, 2000,  the District
Court modified the final order to allow Loon Mountain to convert up 190 million
gallons of water into snow  during the  1999/00  ski season  subject to certain
additional conditions.

    Existing  use of Loon  Mountain  is  authorized  under a Term  Special  Use
Permit, which covers facilities and expires in 2006; existing non-skiing use of
Loon Mountain's South Mountain area is authorized under an annual permit issued
by the United  States Forest  Service that is subject to reissuance  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 Term Special Use Permit. At that time, the conditions
imposed  by the two  District  Court  orders  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 Term  Special  Use  Permits,  the
Company is required to pay fees to the United States Forest  Service.  The fees
range  from  1.5% to  approximately  4.0% of  certain  revenues,  with the rate
generally  rising with increased  revenues.  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
29, 1999 were $1,189,000.

    The Company  believes  that its  relations  with the United  States  Forest
Service are good, and, to the best of its knowledge, no Term Special Use Permit
for any major ski resort has ever been  terminated  by the United States Forest
Service.  The United States Secretary of Agriculture has the right to terminate
any Term Special Use Permit upon  180-days  notice if, in planning for the uses
of the national forest, the public interest requires termination.  Term Special
Use Permits may also be terminated or suspended  because of  non-compliance  by
the permitee;  however,  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
materially adversely affect operations.

    The operations at the resorts require  numerous  permits and approvals from
federal,  state and local  authorities  including permits relating to land use,
ski lifts and the sale of  alcoholic  beverages.  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

<PAGE>

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.

    Except for certain permitting and environmental compliance matters relating
to the Loon  Mountain  resort,  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.

    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,  depending on Bear  Mountain's  operations  and
emissions, Bear Mountain may be required to acquire emission credits from other
facilities which have already implemented  nitrogen oxide emission  reductions.
When  necessary,   the  Company  may  purchase  "banked"  emission  credits  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 snowmaking
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 being 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 resolved.
This allows continued  service to Bear Mountain on an uncontested  basis during
the moratorium period. No assurance can be made regarding the outcome or timing
of resolution of this matter.

    Pursuant to the previously  described decision of the First Circuit and the
order of the  District  Court,  Loon  Mountain  applied and was issued,  by the
Environmental  Protection  Agency  ("EPA"),  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.

    Certain regulatory approvals associated with the new snowmaking pipeline at
Loon Mountain  impose  minimum  stream flow  requirements  on the Loon Mountain
resort.  These  requirements  will compel the 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.  No  assurances  can be given  that  such  regulatory  approvals  will be
obtained or that the Company will have the financial resources to complete such
construction.

    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,  Loon Mountain  worked with the EPA to remove the alleged fill and
implement certain erosion control measures.  On January 15, 1998, an individual
notified the EPA, Loon Mountain,  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. On January 18, 2000, in papers filed in connection  with
the  District  Court's   modification  of  the  final  order  in  the  pipeline
litigation, the same individual again alleged that Loon Mountain had previously
filled  wetlands in violation of the CWA. The Company does not have any further
notice of any threatened lawsuit or other action regarding this matter.

Forward-Looking Statements

    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.  The  forward-looking  statements  are made pursuant to the safe
harbor  provisions  of the Private  Securities  Litigation  Reform Act of 1995.
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
<PAGE>

wishes to caution the reader that certain  factors,  including  those described
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,  but are not limited to:  uncertainty as to
future financial results, the substantial leverage and liquidity constraints of
the Company,  the capital  intensive nature of development of the Company's ski
resorts,  uncertainties  associated  with  obtaining  financing for future real
estate projects and to undertake  future capital  improvements,  demand for and
costs  associated with real estate  development,  the  discretionary  nature of
consumers'  spending for skiing and resort real  estate,  regional and national
economic  conditions,  the successful or  unsuccessful  integration of acquired
businesses,  weather  conditions,  natural  disasters  (such as earthquakes and
floods),   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.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES 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 29, 1999 as filed with the  Securities and
Exchange Commission.
<PAGE>

                           PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

    Each of the  Company's  resorts  has pending  and is  regularly  subject to
litigation,  and the threat  thereof,  with respect to personal  injury  claims
relating  principally to skiing  activities at its resorts but also relating to
premises and  vehicular  operations  and  worker's  compensation  matters.  The
Company  maintains  extensive  liability  insurance that the Company  considers
adequate to monetarily  insure claims related to such usual and customary risks
associated with the operation of four-season recreation resorts.

    Killington West, Ltd., formerly known as Bear Mountain,  Ltd., ("Killington
West "), filed a breach of contract  lawsuit in the Superior Court of the State
of  California,   San  Bernardino  County,   against   Fibreboard   Corporation
("Fibreboard")  and Bear  Mountain,  Inc.  alleging  that  Fibreboard  and Bear
Mountain, Inc. breached the asset purchase agreement dated October 6, 1995 (the
"Original Bear Mountain Agreement") among Killington West,  Fibreboard and Bear
Mountain, Inc. pursuant to which Bear Mountain, Inc. acquired the Bear Mountain
ski resort from Killington West. Killington West's lawsuit concerned an alleged
breach by Fibreboard and Bear Mountain,  Inc. of a change of control  provision
in the Original  Bear  Mountain  Agreement.  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 West,
and further,  required that $1 million of the purchase  price be held in escrow
pending the outcome of any potential disputes with Killington West.  Fibreboard
acknowledged  its obligation to indemnify  Bear Mountain,  Inc. with respect to
the  Killington  West  lawsuit  and will  defend  such  lawsuit  on  behalf  of
Fibreboard and Bear Mountain, Inc.

    In  connection  with the merger with Loon Mountain  Recreation  Corporation
("LMRC"),  certain  shareholders  of LMRC (the "LMRC  Shareholder  Plaintiffs")
filed a  lawsuit  against  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")  in  connection   with  the   transaction.   The  two  lawsuits  were
consolidated in the Superior Court of Grafton County,  New Hampshire.  Prior to
the filing of the lawsuit  against  the  Company,  the  Company  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 LMRC Shareholder  Plaintiffs'  initial
request  for  a  preliminary   injunction   prohibiting  the  Company  (or  its
affiliates)  from  proceeding  with the LMRC  merger  was  denied by the court.
Before the litigation  proceeded further,  and prior to the merger, the parties
to the merger  agreement  amended such agreement.  The Company then obtained an
additional  order by the Bureau that the Takeover  Statute did not apply to the
merger  transaction.  The Company  answered  the LMRC  Shareholder  Plaintiffs'
petition and filed a motion to dismiss the LMRC Shareholder  Plaintiffs' action
against the Company  asserting  that the Takeover  Statute did not apply to the
transaction as a matter of law. The court initially denied the Company's motion
to  dismiss  but  granted  the  motion to dismiss  upon  reconsideration.  LMRC
Shareholder  Plaintiffs  appealed the  dismissal to the New  Hampshire  Supreme
Court and oral  arguments  were  heard in January  of 2000;  the New  Hampshire
Supreme Court's decision has not yet been entered. Potential remedies under the
Takeover Statute include money damages and rescission of the transaction. While
the Company does not believe the LMRC  Shareholder  Plaintiffs  will prevail in
their  actions,  no  assurances  can be made  regarding  the  outcome  of these
actions.

    LMRC Shareholder  Plaintiffs' breach of fiduciary duty action against LMRC,
Parent  and its  former  directors  remains  pending  and  discovery  is  being
conducted.  The  Company  has  filed a Motion  for  Summary  Judgement  and has
requested a continuance  from an April of 2000 trial date,  pending the outcome
of the Corporation Act case described below.  The LMRC  Shareholder  Plaintiffs
were given leave by the court to amend their  complaint  to seek money  damages
against the Company,  LMRC and its former  directors.  If the LMRC  Shareholder
Plaintiffs  are  successful  in  obtaining  a judgment  against the former LMRC
directors,  the Company may have certain  obligations  to indemnify  the former
directors  pursuant to the former  LMRC  by-laws.  While the  Company  does not
believe LMRC Shareholder Plaintiffs will prevail in this lawsuit, no assurances
can be made regarding the outcome of this litigation.

    Also in  connection  with  the  merger  with  LMRC,  the  LMRC  Shareholder
Plaintiffs  exercised  dissenters'  rights  under  the New  Hampshire  Business
Corporation  Act (the  "Corporation  Act").  Under the statutory  procedure for
settling the LMRC Shareholder  Plaintiffs'  dissenters'  rights,  LMRC paid the
plaintiffs an aggregate of $34,436, or $30.61 per share, as its estimate of the
fair value of their 1,125  shares.  The LMRC  Shareholder  Plaintiffs  demanded
<PAGE>

additional  payments  necessary  to  compensate  them for the  $71.38 per share
price,  plus  interest,  which they asserted as the fair value of their shares.
Pursuant to the  Corporation  Act, LMRC  commenced a proceeding in the Superior
Court of Grafton  County,  New  Hampshire  seeking a judicial  appraisal of the
value of the LMRC Shareholder Plaintiffs' shares in LMRC. Discovery in the case
is pending and trial is to be set for March of 2000. While the Company believes
that  the  amount  paid  to  the  LMRC  Shareholder  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 LMRC Shareholder Plaintiffs' 1,125 shares.

    In 1995, an individual  sued the United States Forest  Service (the "Forest
Service") in the United States District Court for the District of New Hampshire
(the  "District  Court")  alleging  that the Forest  Service had  violated  the
National Environmental Policy Act ("NEPA"), the Clean Water Act ("CWA"), and an
executive order in 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  in the lawsuit.  The District  Court  entered
summary  judgment  for the  Forest  Service  on all  claims  and  the  original
plaintiff,  along with the intervening  environmental  group,  (collectively or
individually,  the "Environmental  Plaintiffs") appealed. In December 1996, the
United  States  Court of Appeals for the First  Circuit  (the "First  Circuit")
reversed the  District  Court  decision and ruled that the Forest  Service must
reconsider certain  environmental issues under NEPA and that LMRC must obtain a
discharge  permit  under the CWA for  certain  discharges  from its  snowmaking
system.  The District Court then 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 Forest Service to prepare  supplemental NEPA  documentation on the
improvements  and expansion;  and reserves the right to require  restoration of
areas developed under the original Forest Service approval to their preexisting
condition  if not  ultimately  re-approved  by the Forest  Service.  This order
remains in effect until the supplemental NEPA process is completed.  The Forest
Service  has  revised  its target  date for when it expects to issue draft NEPA
documentation  from the Fall of 1999 to June of 2000.  The  Company can give no
assurance  regarding the timing or outcome of such process.  The  Environmental
Plaintiffs also filed a motion asking the District Court to impose against LMRC
a CWA civil penalty of $5,550,125 and  attorney's  fees and costs in connection
with LMRC's discharges into Loon Pond during its snowmaking  operations for the
1996/97 ski season and prior  years.  The  discharge  at issue  involved  water
transfers  from the East Branch of the  Pemigewasset  River and drain back from
the snowmaking  system into Loon Pond.  The District Court  dismissed the claim
for  civil  penalties  and  attorney's  fees  under  the  CWA  and  one  of the
Environmental  Plaintiffs  appealed to the First  Circuit.  The District  Court
stayed  the appeal  through  March 6,  2000,  initially  to wait for the United
States Supreme Court to rule in a different case involving the CWA, and then to
permit  settlement  negotiations;  the parties have jointly  requested the stay
continue  through  April 5, 2000.  The  parties  are  required to file a status
report with the First Circuit by March 7, 2000.  In connection  with the merger
with LMRC,  the Company  obtained a specific  insurance  policy  providing $4.5
million  of  coverage  (above a $1.2  million  deductible)  to cover  any civil
penalties, fees and costs that the District Court may assess against LMRC.

    In 1997, the  Environmental  Plaintiffs  filed a second lawsuit against the
Forest Service in the District Court alleging that the Forest Service  violated
NEPA in authorizing LMRC to construct and operate a snowmaking  pipeline across
permitted land.  LMRC  intervened in the lawsuit.  The District Court held that
the Forest  Service  had  violated  NEPA by failing to consider  the  potential
effects of an increase in snowmaking capacity. The District Court then enjoined
Loon  Mountain  from using the pipeline but later  modified the  injunction  to
permit LMRC to use the pipeline  provided that, among other things, it does not
make snow in excess of the historic  production  level  utilizing 159.7 million
gallons.  On February  12,  1999,  the District  Court  dismissed  the pipeline
litigation  and allowed the Forest  Service to combine its NEPA analysis of the
pipeline with the pending NEPA analysis of the South  Mountain  expansion.  The
injunction  authorizing  LMRC to use the  pipeline  to supply  water for making
historical  levels of snow remains in place, but was further modified to permit
LMRC to use 190 million gallons of water for snowmaking  during the 1999/00 ski
season subject to certain additional conditions.
<PAGE>

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

    a. Exhibits

    Exhibit No.                             Description of Exhibit
    -----------                             ----------------------
       10.1                    Form of Agreement  for Purchase and Sale of Real
                               Property  dated February 11, 2000 by and between
                               Trimont  Land  Company  and East West  Partners,
                               Inc.

       10.2                    Form  of   Operating   Agreement   of  Northstar
                               Holdings,  L.L.C.  by and between  Trimont  Land
                               Company  and East  West  Resort  Development  V,
                               L.L.L.P.

       27.1                    Financial Data Schedule

    b. Reports on Form 8-K

    No reports on Form 8-K were filed during the quarterly period ended January
28, 2000.
<PAGE>

                                   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
                                              Chief Financial Officer
                                           (Principal Financial Officer)


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


March 10, 2000