Execution Counterpart



                       LIMITED LIABILITY COMPANY AGREEMENT

                                       OF

                              SP LAND COMPANY, LLC




                           Dated as of March 31, 2004



                  THE INTERESTS ISSUED UNDER THIS AGREEMENT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR REGISTERED OR QUALIFIED UNDER THE APPLICABLE STATE SECURITIES LAWS, IN
RELIANCE UPON EXEMPTIONS FROM REGISTRATION AND QUALIFICATION PROVIDED IN THE
SECURITIES ACT AND THE APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT AND QUALIFICATION OR REGISTRATION UNDER THE APPLICABLE STATE
SECURITIES LAWS, OR AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER THAT SUCH
REGISTRATION OR QUALIFICATION IS NOT REQUIRED.

                  IN ADDITION, THE INTERESTS ISSUED UNDER THIS AGREEMENT MAY BE
SOLD OR TRANSFERRED ONLY IN COMPLIANCE WITH THE RESTRICTIONS ON TRANSFER SET
FORTH HEREIN.




<PAGE>


                                TABLE OF CONTENTS

                                                                            Page

ARTICLE 1 DEFINITIONS..........................................................1


ARTICLE 2 LIMITED LIABILITY COMPANY............................................5

         2.1      Certificate of Formation.....................................5
         2.2      Name.........................................................5
         2.3      Principal Office, Resident Agent and Registered Office.......5
         2.4      Purpose......................................................5
         2.5      Term.........................................................6
         2.6      Fiscal Year..................................................6

ARTICLE 3 CAPITAL CONTRIBUTIONS AND LOANS BY MEMBERS...........................6

         3.1      Initial Capital Contributions................................6
         3.2      Member Loans.................................................6
         3.3      General......................................................6
         3.4      No Third Party Rights........................................7
         3.5      Return of Capital............................................7

ARTICLE 4 MANAGEMENT...........................................................7

         4.1      Designation of Managing Member and Grant of Authority........7
         4.2      Officers.....................................................9
         4.3      Affiliate Agreements.........................................9
         4.4      Limitation on Authority of Other Members to Act on Behalf
                    of Company.................................................9
         4.5      Permissible Activities of the Members........................9
         4.6      Exculpation.................................................10
         4.7      Bank Accounts...............................................10

ARTICLE 5 COMPENSATION AND FEES...............................................10

         5.1      Reimbursement of Expenses...................................10
         5.2      No Additional Fees..........................................10

ARTICLE 6 COVENANTS, WARRANTIES AND REPRESENTATIONS OF MEMBERS................11
         6.1      Representations and Warranties of Killington................11
         6.2      Representations and Warranties of ASCRP.....................11

ARTICLE 7 BOOKS AND RECORDS; AUDITS; CERTAIN TAX MATTERS......................12

         7.1      Books and Records; Audits; Certain Tax Matters..............12

ARTICLE 8 CAPITAL ACCOUNTS; DISTRIBUTIONS; ALLOCATIONS........................13

         8.1      Capital Accounts............................................13
         8.2      Allocations.................................................13
         8.3      Distributions...............................................14
         8.4      Withholding.................................................15
         8.5      Final Distribution..........................................15

                                       2
<PAGE>

ARTICLE 9 DISSOLUTION.........................................................15

         9.1      Dissolving Events...........................................15
         9.2      Methods of Liquidation......................................15
         9.3      Reasonable Time for Liquidating.............................16
         9.4      Date of Liquidation.........................................16
         9.5      Withdrawals.................................................16

ARTICLE 10 SALE; ASSIGNMENT; TRANSFER.........................................16

         10.1     Transfers of Interests in Company...........................16
         10.2     Restraining Order; Specific Performance; Other Remedies.....17
         10.3     Compliance with Law.........................................17
         10.4     Substitute Members..........................................17
         10.5     Section 754 Election........................................17
         10.6     Release of Liability........................................18

ARTICLE 11 NOTICES............................................................18

         11.1     In Writing; Address.........................................18
         11.2     Method......................................................19

ARTICLE 12 MISCELLANEOUS......................................................19

         12.1     Additional Documents and Acts...............................19
         12.2     Governing Law and Jurisdiction..............................19
         12.3     Pronouns....................................................19
         12.4     Entire Agreement............................................19
         12.5     References to this Agreement................................19
         12.6     Headings....................................................20
         12.7     Binding Effect..............................................20
         12.8     Counterparts................................................20
         12.9     Amendments..................................................20
         12.10    Estoppel Certificates.......................................20
         12.11    Exhibits....................................................20
         12.12    Severability................................................20
         12.13    Waiver; Modification........................................20
         12.14    Third-Party Beneficiaries...................................20
         12.15    Reliance on Authority of Person Signing Agreement;
                    Designated Representatives; Authority of Managing Member..21
         12.16    Indemnity...................................................21
         12.17    Herein......................................................22
         12.18    Including...................................................22
         12.19    Cost of Counsel.............................................22
         12.20    Days........................................................22
         12.21    Time of Essence.............................................22
         12.22    General Exculpation.........................................22
         12.23    Partition...................................................22


                                       3
<PAGE>

Exhibits

Exhibit A   - Description of Killington Property and ASCRP Property
Exhibit A-1 - Description of Cherry Knoll Property
Exhibit B   - Designated Representations
Exhibit C   - Tax Exhibit


                                       4
<PAGE>


                       LIMITED LIABILITY COMPANY AGREEMENT
                                       OF
                              SP LAND COMPANY, LLC

                  THIS LIMITED LIABILITY COMPANY AGREEMENT (this "Agreement") of
SP LAND COMPANY, LLC, a Delaware limited liability company (the "Company"), is
executed as of March 31, 2004, by and among AMERICAN SKIING COMPANY RESORT
PROPERTIES, INC., a Maine corporation ("ASCRP"), and KILLINGTON, LTD., a Vermont
corporation ("Killington")

                              W I T N E S S E T H :

                  WHEREAS, the Members formed the Company pursuant and subject
to the Delaware Limited Liability Company Act (as amended from time to time, the
"Act") pursuant to that certain Certificate of Formation of the Company, dated
as of March 17, 2004, and filed with the Secretary of State of the State of
Delaware on March 17, 2004 (the "Certificate of Formation");

                  WHEREAS, in connection with the formation of the Company and
in exchange for certain Membership Interests therein, as more fully hereinafter
set forth, ASCRP is contributing all of its right, title and interest in and to
certain land, receivables, and cash accounts more fully described on Exhibit A
attached hereto (the "ASCRP Property"), and Killington iss contributing to the
Company all of it's right, title and interest in and to certain real property
described generally on Exhibit A attached hereto including an undivided fifty
percent (50%) interest in the "Cherry Knoll" property described on said Exhibit
A-1 (collectively the "Killington Property," the ASCRP Property and the
Killlington Property are collectively referred to herein as the "Development
Property");

                  WHEREAS, ASCRP and Killington now desire to enter into this
Agreement to (i) reflect the contributions described above and ASCRP's and
Killington's admission as Members in the Company as a result thereof, (ii) set
forth the Members' respectve Membership Interests as a result of such
contributions, and (iii) otherwise establish the Members' respective rights in
the Company and the terms and provisions upon which the Company shall operate.

                  NOW, THEREFORE, in consideration of the premises and the
mutual promises, obligations and agreements contained herein, and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties, intending to be, and hereby being, legally bound,
hereby agree as follows:

                                   ARTICLE 1

                                  DEFINITIONS

     The following terms shall have the following meanings when used herein:

     "Act": As defined in the Recitals.


                                       1
<PAGE>


     "Affiliate": With respect to any designated Person, any other Person which,
directly or indirectly,  controls or is controlled by or is under common control
with such  designated  Person.  "Control"  means  the  possession,  directly  or
indirectly,  of the power to direct or cause the direction of the  management or
policies of a Person.

     "Affiliate Agreement": Any contract,  agreement or other arrangement,  oral
or  written,  entered  into  between  the  Company  and any  Person  which is an
Affiliate of a Member with respect to the provision of services to, or supplies,
machinery or equipment for, the Company Assets or any portion thereof.

     "Agreement":  This Limited Liability Company Agreement,  as the same may be
amended from time to time in accordance herewith.

     "ASC": American Skiing Company, a Delaware corporation.

     "ASCRP": As defined in the Preamble.

     "ASCRP Property": As defined in the Preamble.

     "Business  Day":  A day  which is not a  Saturday  or  Sunday  or a legally
recognized public holiday in the United States or the State of New York.

     "Capital Account": As defined in Section 8.1.

     "Capital   Contributions":   (a)  the  sum  of  (i)  the  Initial   Capital
Contributions made, or deemed made, by a Member pursuant to Section 3.1(c), plus
(ii) any  additional  Capital  Contributions  made by such Member after the date
hereof.

     "Cash Flow": Cash Flow for any period shall mean:

     (a) the  gross  cash  receipts  of the  Company  for such  period  from all
sources,  including,  but not limited to, all receipts from the operation of the
Development  Property  or any  other  Company  Assets,  the sale or lease of any
portion of the Development  Property or any other Company  Assets,  net proceeds
available to the Company from any  financing or  refinancing,  the cash proceeds
attributable  to any Capital  Contributions  and Member Loans,  made during such
period and net  reductions  in funded  reserves or sinking  funds of the Company
(other than any such reductions used to pay Company expenditures); less

     (b) without  duplication of any amounts  deducted in determining (a) above,
the gross cash expenditures of the Company for such period for all purposes with
respect to the  Company  including  both  operating  and  capital  expenditures,
including  any amounts paid with respect to any Loans,  determined in accordance
with  cash  basis  accounting   principles   consistently   applied   (excluding
expenditures made from previously established reserves); less

     (c)  deposits or  allocations  into reserve  accounts  for the  Development
Property or any other Company Assets.

     "Certificate of Formation": As defined in the Recitals.


                                       2
<PAGE>


     "Cherry  Knoll  Property":   Killington's  undivided  fifty  percent  (50%)
interest in the portion of the Killington  Property  described as "Cherry Knoll"
on Exhibit A-1 attached hereto.

     "Code": The Internal Revenue Code of 1986, as amended.

     "Company": As defined in the Preamble.

     "Company Assets": All interests, rights and properties of any kind owned by
the  Company,  including  the  Development  Property  and  any  interest  in any
partnership,  limited partnership,  joint venture,  limited liability company or
similar  organization  or joint  participation  arrangement in which the Company
shall, directly or indirectly, be a partner, member, venturer, investor or other
beneficial  interest  owner or  otherwise  participate  in  connection  with the
Development  Property (or any portion thereof) or any other property acquired by
the  Company,   or  otherwise  in  connection  with  the  Company's  purpose  as
hereinafter set forth.

     "Development Entity": As defined in Section 4.1(e).

     "Development Property": Collectively, the Killington Property and the ASCRP
Property, and all buildings, structures,  improvements, fixtures, equipment, and
other  installations  now or  hereafter  erected  on,  in,  under,  or above the
Killington Property and/or the ASCRP Property,  together with all rights related
thereto,  including  all  entitlements,  development  rights,  contract  rights,
leases, easements, utility rights and other appurtenances thereto.

     "Fiscal Year": As defined in Section 2.6.

     "Initial  Capital  Contribution":  Shall mean the amounts  contributed,  or
deemed contributed, by each Member pursuant to Section 3.1 hereof.

     "Initial  Preference  Amount":  Shall mean, with respect to Killington (and
its successors and/or assigns), the amount of [$_________________].

     "Killington": As defined in the Preamble.

     "Killington Property": As defined in the Recitals.

     "Killington  Resort":  Shall  mean the ski  trails,  lifts,  day lodges and
related ski facilities located on and around Killington  Mountain in Killington,
Vermont.

     "Loan":  Any  indebtedness  or obligation for money borrowed by the Company
(including any Member Loans).

     "Managing  Member":  Killington,  in its capacity as the Managing Member or
any of its successors in their respective capacities as Managing Member admitted
to the Company as the Managing Member  hereunder in accordance with the terms of
this  Agreement,  for so long as any such Person is  designated  as the Managing
Member under the terms of this Agreement.


                                       3
<PAGE>

     "Member" or "Members":  Each of ASCRP and  Killington  in their  respective
capacities as Members,  any of their  permitted  successors in their  respective
capacities as Members admitted to the Company as Members hereunder in accordance
with the  terms of this  Agreement,  for so long as any such  Person is a Member
under the terms of this Agreement.

     "Member Loan": As defined in Section 3.2.

     "Membership  Interest":  With respect to any Member,  such Member's  entire
interest in the Company  including such Member's right to receive  distributions
and to  participate in the management of the business and affairs of the Company
on the terms and conditions  hereinafter set forth,  including the right to vote
on,  consent to or otherwise  participate in any decision or action of or by the
Members granted pursuant to this Agreement and the Act.

     "Membership  Percentage":   With  respect  to  any  Member,  that  Member's
percentage  ownership  interest  in the  Company.  As of the  date  hereof,  the
Membership Percentages are as follows:

                  Killington  __%
                  ASCRP       __%

     "Mortgage(s)":  Any  mortgage,  deed of trust,  deed to secure debt,  bond,
collateral assignment,  indenture,  pledge or other lien or security interest in
all or any part of the Development Property or any other Company Assets.

     "Original Agreement": As defined in the Recitals.

     "Person": An individual,  partnership, joint venture, corporation, trust or
other entity.

     "Pledge": Any voluntary pledge,  mortgage, deed of trust, security interest
or other consensual lien or hypothecation  of, in or on any Member's  Membership
Interest,  including on any right of such Member to receive  distributions  from
the Company.

     "Securities Act": As defined on the cover page of this Agreement.

     "Ski Resort Operator": As defined in Section 4.4.

     "Tax Matters Partner": As defined in Section 7.1(g).

     "Transfer": As defined in Section 10.1(a).

     "Unpaid Preferred Return":  With respect to each Member (and its successors
and/or assigns) only, as of the end of any day during the term hereof, an amount
equal to (a) the  Unpaid  Preferred  Return of such  Member as of the end of the
immediately  preceding day, plus (b) the product of the Unpaid  Preferred Return
of such Member as of the end of the immediately  preceding day multiplied by the
daily  interest  factor for an interest  rate of twelve  percent (12%) per annum
compounded annually,  plus (c) the product of the Unrecovered  Preference Amount
of such Member as of the end of the immediately  preceding day multiplied by the
daily  interest  factor for an interest  rate of twelve  percent (12%) per annum
compounded annually,  minus (d) any distributions made to such Member during the
day in question pursuant to Section 8.3(b).


                                       4
<PAGE>

     "Unrecovered  Preference  Amount":  With  respect to each  Member  (and its
successors and/or assigns) only, the Initial  Preference Amount, as increased by
the amount of any  Capital  Contributions  hereafter  made by such  Member,  and
decreased  by the  amount of any  distributions  hereafter  paid to such  Member
pursuant to Section 8.3(c).

                                   ARTICLE 2

                            LIMITED LIABILITY COMPANY

     2.1  Certificate of Formation.  The Certificate of Formation has been filed
with  the  Office  of the  Secretary  of State of the  State  of  Delaware.  The
Certificate of Formation may hereafter be amended whenever,  and within the time
periods, required by the Act.

     2.2 Name. The name of the Company is SP Land Company LLC, in which name all
assets  belonging to the Company shall be held and under which name all business
and affairs of the Company  shall be conducted,  except to the extent  otherwise
required  by the laws of the State of  Delaware  or any other state in which the
Company is doing business.  2.3 Principal Office,  Resident Agent and Registered
Office.  The principal  office of the Company shall initially be located at 4763
Killington Access Road, Killington,  Vermont 05751-4746,  or at such other place
or places as the  Managing  Member  may from time to time  designate,  provided,
however,  that the Company shall at all times maintain a registered  agent and a
registered  office  in the  State  of  Delaware.  The name  and  address  of the
registered  agent for service of process on the Company in the State of Delaware
is The Corporation Trust Company,  Corporation Trust Center, 1209 Orange Street,
Wilmington,  Delaware 19801. The address of the registered office of the Company
in the State of Delaware is The  Corporation  Trust Company,  Corporation  Trust
Center, 1209 Orange Street,  Wilmington,  Delaware 19801. Such principal office,
registered agent or registered  office may be changed by the Managing Member, so
long as in accordance with the Delaware Act;  concurrently with any such change,
written  notice  thereof  shall  be  given to each  Member.  Promptly  following
execution and delivery of this  Agreement,  the Managing  Member shall cause the
Company  to  register  as a foreign  limited  liability  company in the State of
Vermont.

     2.4  Purpose.  The objects and purposes of the Company are solely to invest
in,  acquire,  hold,  own,  operate,  manage,  maintain,   improve,   subdivide,
pre-develop,  develop, sell, finance,  lease, and otherwise use or deal with the
Development  Property  and  any  other  Company  Assets,  for  profit  and as an
investment,  and in all  respects  to act as owner  of the  Company  Assets.  In
furtherance  of the  foregoing,  the Company's  purposes  shall include to make,
enter  into,   deliver  and  perform  all   contracts,   agreements   and  other
undertakings,  pay all costs and expenses, and do all such other acts and things
as the  Managing  Member  may deem  necessary  or  advisable  to  carry  out the
foregoing  objects and purposes upon and subject to the terms and  conditions of
this  Agreement.  The Company may do any of the foregoing  through  wholly-owned
subsidiaries or, subject to Section 4.3 below, through any Development Entity in
which the Company shall, directly or indirectly, be a partner, member, venturer,
investor or other beneficial interest owner.


                                       5
<PAGE>


     2.5 Term. The term of the Company shall continue until the  liquidation and
dissolution of the Company pursuant to Article 9 hereof.

     2.6 Fiscal Year.  The fiscal year of the Company (the "Fiscal  Year") shall
end on the 31st day of  December in each year.  The Company  shall have the same
Fiscal Year for income tax and accounting purposes.

                                   ARTICLE 3

                   CAPITAL CONTRIBUTIONS AND LOANS BY MEMBERS

     3.1 Initial Capital Contributions.

     (a)  Killington.  As of the date hereof,  Killington is contributing to the
Company all of Killington's  right,  title and interest in and to the Killington
Property, in exchange for Killington's Membership Interest in the Company. As of
the date hereof, Killington's Membership Percentage is __________________ (__%).

     (b) ASCRP. As of the date hereof, ASCRP is contributing to the Company, all
of ASCRP's right,  title and interest in and to the ASCRP Property,  in exchange
for ASCRP's Membership Interest in the Company.  As of the date hereof,  ASCRP's
Membership Percentage is ___________________ (__%).

     3.2 Member Loans. If at any time or from time to time, additional funds are
required (or are expected to be  required) to meet the  obligations  or needs of
the Company, or are otherwise  determined by the Managing Member to be necessary
or desirable in connection  with any activity by the Company in  fulfilling  its
purpose as described in Section 2.4 hereof or as otherwise  contemplated by this
Agreement,  ASCRP  and  Killington  shall  each  have  the  right,  but  not the
obligation,  to make a loan ("Member Loan") for the amount of funds so required.
If ASCRP does not make a Member Loan, then Killington may make a Member Loan for
the full amount of the funds so required. If both ASCRP and Killington desire to
make a Member  Loan,  they  shall do so in such  amounts as agreed to, or in the
absence of agreement,  _________________  percent (__%) of the funds so required
will be loaned by  Killington  and _________  percent (1%) loaned by ASCRP.  Any
such  Member  Loans shall bear  interest  from the time each such Member Loan is
made  computed  at a per annum rate  equal to the  lesser of (A) twelve  percent
(12%),  or (B) the highest rate  allowed by  applicable  law.  Member Loans made
pursuant to this Section 3.2 shall be repaid as provided in Section 8.3(a).

     3.3 General.

     (a) Except as specifically  provided in this Agreement,  no Member shall be
obligated to contribute  capital to, or and no Member may withdraw capital from,
the  Company.  To the extent any monies  which any Member is entitled to receive
pursuant to Article 8 below would  constitute  a return of capital,  each of the
Members consents to the withdrawal of such capital.

                                       6
<PAGE>

     (b) Interest  earned on Company  funds shall inure solely to the benefit of
the Company. Unless otherwise specifically provided herein, no interest shall be
paid on any Capital Contributions or advances to the capital of the Company, nor
upon any undistributed or reinvested income or profits of the Company.

     3.4 No Third Party Rights.  The right of the Members to require or make any
Capital  Contributions  after the date hereof or Member Loans under the terms of
this Agreement shall not be construed as conferring any rights or benefits to or
upon any Person not a party to this Agreement, or the holder of any indebtedness
of the Company,  or the holder of any obligations secured by a Mortgage or other
lien or  encumbrance  upon or affecting  the Company or any interest of a Member
therein or in the Company  Assets or any part thereof or any  interest  therein,
except to the extent expressly agreed in writing by all Members.

     3.5 Return of Capital.  Except as otherwise  provided in Article 8 or 9, no
Member  shall  have the right to demand or to  receive  the return of all or any
part of its contributions to the capital of the Company. In addition,  no Member
has the right to demand or to receive property other than cash in return for its
contributions to the capital of the Company.

                                   ARTICLE 4

                                   MANAGEMENT

     4.1  Designation  of  Managing  Member  and Grant of  Authority.  Except as
otherwise  provided in this  Agreement,  the Managing  Member (i) shall have the
sole and exclusive power and authority on behalf of the Company to carry out any
and all of the  purposes  of the  Company and to perform all acts and enter into
and perform all  contracts  and other  undertakings  that it may in its sole and
absolute discretion deem necessary or advisable or incidental thereto,  and (ii)
shall have,  and shall have full and  absolute  authority in its  discretion  to
exercise,  on behalf of and in the name of the Company, all rights and powers of
a manager or managing  member under the Act.  Without in any manner limiting the
foregoing, the Members hereby stipulate, confirm, acknowledge and agree that the
Managing Member,  acting directly or through any duly appointed  Officers of the
Company,  may cause the Company to do, or cause to be done,  on behalf and as an
act of the Company,  any act which is necessary or desirable to carry out any of
the purposes of the Company, including any of the following:

     (a) Enter  into,  make,  deliver and  perform  all  contracts,  agreements,
instruments  and other  undertakings as the Managing Member may, in its sole and
absolute  discretion,  determine  to be  necessary,  advisable,  appropriate  or
incidental  to the  carrying  out of the objects and purposes set forth above or
contemplated by this Agreement, the taking of such action by the Managing Member
to be conclusive evidence of such determination;

     (b) Acquire, either directly or indirectly,  real property and tangible and
intangible personal property of any kind, character or nature;

     (c) Arrange  financing for the Company and cause the Company to directly or
indirectly borrow money or otherwise directly or indirectly incur,  guarantee or
otherwise become liable for any amount of indebtedness  (including  indebtedness
for accrued  expenses or ordinary trade  payables) in connection with the any of
the Company Assets and/or the operation of the Company's business activities;

                                       7
<PAGE>

     (d) Mortgage,  pledge,  assign or otherwise  create a lien,  encumbrance or
security  interest  in or on all or any part of the  Company  Assets in order to
secure Loans or advances to the Company or any Person in which the Company has a
direct  or  indirect  interest  (including  any  Development   Entity),  or  any
obligation  of the  Company or any Person in which the  Company  has a direct or
indirect interest  (including any Development  Entity), or for any other Company
purpose;

     (e) Sell, assign, transfer,  exchange, master lease, or otherwise liquidate
and  dispose of all or any  portion  of, or  interest  in, the  Company  Assets,
including  entering  into or  modifying  any  sale,  transfer,  lease  or  other
agreement or contract with respect thereto;

     (f) Manage,  maintain,  operate, repair, improve,  subdivide,  pre-develop,
develop,  lease or otherwise  deal in any manner with, all or any portion of the
Company Assets,  including entering into or modifying any development,  leasing,
management,  easement,  restrictive  covenant,  or other agreement,  for or with
respect to all or any portion of, or interest in, the Company Assets;

     (g) Seek,  obtain,  amend or modify any  zoning,  regulatory  approvals  or
permits,  subdivision  approvals  or  permits,  acquire  other  entitlements  or
otherwise  deal in any manner  with the  Development  Property  (or any  portion
thereof) or any other property acquired by the Company;

     (h) Guaranty or provide indemnifications for the obligations of any Person;

     (i) Employ or consult such  Persons  (including  any partner,  shareholder,
officer,  director,  agent, advisor or employee of any Affiliate of a Member) as
the  Managing  Member shall deem  necessary,  appropriate  or advisable  for the
operation  and  management  of  the  Company,  including  brokers,  accountants,
engineers,  attorneys or  specialists in any field of endeavor  whatsoever,  and
authorize any such Person to act for and on behalf of the Company;

     (j) Make expenditures as are required to operate and manage the Company and
the Company Assets and to otherwise carry out any of the activities described in
this Section 4.1;

     (k) Deposit the funds of the Company in the  Company's  name in any bank or
trust company and entrust to such bank or trust  company any of the  securities,
monies, documents and papers belonging to or relating to the Company; or deposit
with  and  entrust  to any  brokerage  firm  that is a  member  of any  national
securities exchange any of said funds, securities,  monies, documents and papers
belonging to or relating to the Company;

     (l)  Possess,  monitor,  manage,  or  otherwise  deal in, and  exercise all
rights,  powers,  privileges and other incidents of ownership or possession with
respect to Company Assets or any other property held or owned by the Company;

                                       8
<PAGE>

     (m) Make appropriate  elections and other decisions with respect to tax and
accounting  matters;  prepare  and file all tax  returns  for the  Company  (but
without  any  obligation  hereunder  to prepare or file the tax returns or other
reports of the Members);

     (n) Bring and defend  actions and  proceedings  at law or equity before any
court or governmental,  administrative or regulatory agency,  body or commission
or otherwise;

     (o) Acquire and enter into any contract of insurance necessary or desirable
for the protection or  conservation  of the Company and/or the Company Assets or
otherwise  in the  interest of the Company  (including  directors  and  officers
insurance  or the  equivalent  thereof)  as the  Managing  Member,  in its  sole
discretion, shall determine;

     (p)  Distribute  funds to the Company by way of cash or  otherwise,  all in
accordance with the provisions of this Agreement; and

     (q) Do any other act which is  necessary  or  desirable to carry out any of
the purposes of the Company.

     4.2 Officers.  The Managing  Member may designate one or more Persons to be
officers of the Company  ("Officers"),  and any Officer so designated shall have
such  title,  authorities,  duties,  and  salaries  as the  Managing  Member may
delegate to them.  Any  Officer  may be removed as such,  either with or without
cause, by the Managing Member at any time.

     4.3  Affiliate  Agreements.  The  Managing  Member may cause the Company to
enter into  Affiliate  Agreements  and the validity of any such  transaction  or
agreement  (or any  payment  thereunder)  shall not be affected by reason of any
relationship  between  the Company  and a Member or any  Affiliate  of a Member,
provided that such agreements are on terms no less favorable to the Company than
those that would be applicable without such Affiliate relationship.

     4.4  Limitation  on Authority of Other Members to Act on Behalf of Company.
The Members (other than the Managing Member) in their capacities as Members have
no  authority  to act for or bind the  Company  and may not  participate  in the
general  management,  conduct or control of the  Company's  business or affairs.
Notwithstanding the foregoing,  to the extent specifically  requested in writing
by the Managing Member,  each Member shall cooperate with the Managing Member in
connection with any of the activities of the Company described in Section 4.1(g)
above.

     4.5 Permissible Activities of the Members. The Members and their Affiliates
may  individually  and/or with  others  (i.e.,  other than in their  capacity as
Members)  engage in other  activities  for  profit,  whether in the real  estate
business or otherwise, including the ownership, operation,  development, leasing
and management of other properties similar to the Development Property,  and may
in the future  participate in  partnerships or other ventures for such purposes.
Neither  the  Company  nor the  Members  shall  have any right by virtue of this
Agreement in or to such independent ventures or to the income or profits derived
therefrom.

                                       9
<PAGE>

     4.6 Exculpation.

     (a) The Managing Member shall not be liable or  accountable,  in damages or
otherwise,  to the  Company  or to any other  Member  for any act  performed  or
failure to act by it that arises out of, or in connection  with,  this Agreement
or the  Company's  business  and  affairs,  unless such act or failure to act is
attributable to (i) fraud, (ii) gross negligence,  (iii) willful misconduct,  or
(iv) material  breach of the terms and provisions of this  Agreement;  provided,
however,  that,  solely for purposes of clause (iv) of this Section 4.9(a),  the
Managing Member shall not be liable or accountable,  in damages or otherwise, to
the Company or to any other Member for any breach of the terms and provisions of
this Agreement with respect to which the Managing  Member can establish that (A)
such act or  failure  to act was  undertaken  with due  regard for the terms and
provisions of this  Agreement and (B) in the  reasonable  good faith judgment of
the Managing Member, such act or failure to act was not a violation of the terms
and provisions of this Agreement.

     (b) The Company (but not any Member) shall  indemnify and hold harmless the
Managing Member (and its partners,  members, and Affiliates) and any Officers of
the  Company,  for any loss,  damage,  liability,  cost,  or expense  (including
reasonable  attorneys'  fees) claimed by a third party and incurred by virtue of
the Managing Member's or the Officer's  activities  hereunder and arising out of
any act  performed  or  failure to act by it (or them) if such act or failure to
act  arises out of, or in  connection  with,  this  Agreement  or the  Company's
business and affairs, and is not an act for which such Managing Member is liable
under Section 4.9(a)(i) through (iv) above.

     4.7 Bank Accounts. On behalf of and at the expense of Company, the Managing
Member shall maintain accounts in the name of the Company and operating accounts
in the name of the Company in banks or trust companies in the continental  U.S.,
for the deposit and disbursement of all funds relating to the Company.  All such
Company  funds  shall be promptly  deposited  in such  accounts,  to be held and
disbursed only as provided herein.

                                   ARTICLE 5

                              COMPENSATION AND FEES

     5.1  Reimbursement  of  Expenses.  The  Company  shall pay to the  Managing
Member,  as and when requested,  the amounts necessary to reimburse the Managing
Member for the  direct,  third  party,  out-of-pocket  expenses  incurred by the
Managing  Member  in  administering  the  Company  hereunder,  including  travel
expenses and any fees, salaries, benefits, commissions and other compensation or
reimbursements  paid to or for the benefit of any  Officers or  employees of the
Company.

     5.2 No Additional  Fees. As of the date of this Agreement,  the Company has
not agreed to pay any fees to a Member or its Affiliate  other than as set forth
in this Article 5.

                                       10
<PAGE>

                                   ARTICLE 6

              COVENANTS, WARRANTIES AND REPRESENTATIONS OF MEMBERS

     6.1  Representations  and  Warranties  of  Killington.  In  addition to the
covenants,  warranties and  representations  made  elsewhere in this  Agreement,
Killington does hereby  covenant,  warrant and represent that, as of the date of
this Agreement:

     (a)  Killington  has all  requisite  power and authority to enter into this
Agreement and to consummate the transactions contemplated hereby.

     (b) All acts and other  proceedings  required to be taken by  Killington to
authorize the  execution,  delivery and  performance  of this  Agreement and the
consummation of the transactions contemplated hereby have been duly and properly
taken.

     (c) This  Agreement has been duly executed and delivered by Killington  and
constitutes the valid and binding obligation of Killington,  enforceable against
it in  accordance  with its  terms,  except  as may be  limited  by  bankruptcy,
insolvency and other similar laws and general equitable principles.

     (d)  Killington  has obtained  all  approvals  and consents  required to be
obtained by it in connection  with the execution and delivery of this  Agreement
by Killington and the consummation of the transactions  contemplated hereby from
all governmental authorities having any approval rights with respect thereto and
all Persons having consent rights, to the extent that the failure to obtain such
approval or consent would have a material  adverse  effect on the Company or its
assets.

     (e) Killington has not contracted with or authorized any broker,  agent, or
finder to act on its behalf with respect to this  Agreement,  the Company or the
Development Property.

     6.2  Representations and Warranties of ASCRP. In addition to the covenants,
warranties and representations  made elsewhere in this Agreement,  each of ASCRP
does  hereby  covenant,  warrant  and  represent  that,  as of the  date of this
Agreement:

     (a) ASCRP has all the  requisite  power and  authority  to enter  into this
Agreement and to consummate the transactions contemplated hereby.

     (b) All  acts  and  other  proceedings  required  to be  taken  by ASCRP to
authorize the  execution,  delivery and  performance  of this  Agreement and the
consummation of the transactions contemplated hereby have been duly and properly
taken.

     (c) This  Agreement  has been  duly  executed  and  delivered  by ASCRP and
constitutes the valid and binding obligation of ASCRP enforceable  against it in
accordance  with its terms,  except as may be limited by bankruptcy,  insolvency
and other similar laws and general equitable principles.

                                       11
<PAGE>

     (d) ASCRP has obtained all approvals  and consents  required to be obtained
by it in connection  with the  execution and delivery of this  Agreement and the
consummation  of the  transactions  contemplated  hereby  from all  governmental
authorities  having any  approval  rights with  respect  thereto and all Persons
having consent rights, to the extent that the failure to obtain such approval or
consent would have a material adverse effect on the Company or its assets.

     (e) ASCRP has not  contracted  with or  authorized  any broker,  agent,  or
finder to act on its behalf with respect to this Agreement,  the Company, or the
Development Property.

                                   ARTICLE 7

                               BOOKS AND RECORDS;
                           AUDITS; CERTAIN TAX MATTERS

     7.1 Books and Records; Audits; Certain Tax Matters.

     (a) Books and  Records.  The  Managing  Member  shall keep and maintain the
books and records of the Company and the Company Assets, which shall be prepared
in accordance  with  [generally  accepted  accounting  principles]  consistently
applied.  Any Member  shall have  access to such  books and  records  upon prior
written  notice,  and each shall have the right to copy said  records at its own
expense.

     (b) Where Maintained.  The books, accounts and records of the Company shall
at all times be maintained at the principal office of the Company.

     (c) Audits;  Access to  Information  by Members.  Upon at least thirty (30)
days notice to the Managing Member, any Member may, at its option and at its own
expense,  conduct audits of the books,  records and accounts of the Company. The
Managing Member shall provide the Member's appraisers,  accountants and advisors
with access to all information related to the value of the Company Assets and to
the management  personnel  involved directly or indirectly in the affairs of the
Company and shall cause such  personnel to  cooperate  fully with such Member or
its designees and to furnish information requested by it or its designees, as to
the status of the affairs of the Company.

     (d) Reports.  The Managing Member shall prepare and distribute such reports
and information to the Members as shall be reasonably  requested by such Members
in order to enable them to be fully  informed  about the affairs of the Company.
In addition,  the Managing  Member  shall  deliver to the Members  copies of any
reports  furnished  by the  Company  to Fleet in  connection  with the New Fleet
Loans.  Further,  not later than  ninety  (90) days after the end of each Fiscal
Year,  the  Company  shall  provide  certified  financial  statements  and other
financial information concerning the Company, so as to allow each Member and its
Affiliates to timely file all necessary U.S. tax returns and to publish relevant
financial statements.

     (e) Tax Returns.  The Managing  Member shall prepare and file (or cause the
Company's  accountants  to prepare and file) in a timely manner after the end of
each  Fiscal Year all  federal,  state and local tax returns for the Company for
such Fiscal Year and shall cause a copy thereof to be delivered to the Members.

                                       12
<PAGE>

     (f) Cost of Accounting and Statements. Any costs incurred by the Company or
the Managing Member in connection with the foregoing  subsections (a), (c), (d),
and (e) shall be an expense of the Company.

     (g) Tax Matters  Partner.  The  Managing  Member  shall have full power and
authority  to act for the Company and the Members as "Tax Matters  Partner",  as
defined  in  section   6231(a)(7)   of  the  Code,   with  all  the  rights  and
responsibilities  of that position described in sections 6222-32 of the Code and
to act in any similar  capacity  under  applicable  state or local law.  The Tax
Matters  Partner  shall  keep  the  Members  informed  as to the  status  of any
correspondence  or communication  that relates to (or may culminate in) an audit
of the  Company's  income,  employment  or payroll tax  affairs by the  Internal
Revenue  Service.  The Company shall  reimburse the Tax Matters  Partner for all
costs and  expenses  incurred  by it in the  exercise  of the rights  and/or the
performance  of the  responsibilities  referred to in this Section  7.1(g).  The
Company  shall  indemnify  and hold  harmless  the Tax Matters  Partner from all
claims,  liabilities,  costs and expenses,  including reasonable attorneys' fees
and court  costs,  incurred  by it in the  exercise  of the  rights  and/or  the
performance of the responsibilities referred to in this Section 7.1(g).

                                   ARTICLE 8

                  CAPITAL ACCOUNTS; DISTRIBUTIONS; ALLOCATIONS

     8.1 Capital  Accounts.  A "Capital  Account"  shall be maintained  for each
Member.  The Members'  Capital  Accounts  is, as of the date  hereof,  equal to:
[$______]  in the case of ASCRP,  and [$____] in the case of  Killington,.  Such
Capital  Account  shall  thereafter be increased by (i) the amount of additional
cash and the fair market value of any  additional  property  contributed by such
Member  to the  capital  of the  Company  (net of  liabilities  secured  by such
contributed property that the Company is considered to assume or to take subject
to under Section 752 of the Code), (ii) the amount of any Profits (as defined in
Exhibit C)  allocated  to such Member  pursuant to Section  8.2(a) and (iii) the
amount of any special  allocations of income or gain to such Member  pursuant to
Section 2.1 of Exhibit C and decreased by (a) the amount of money distributed to
such  Member  by the  Company,  (b)  the  fair  market  value  of  any  property
distributed  to such Member by the Company (net of  liabilities  secured by such
distributed property that such Member is considered to assume or take subject to
under  Section  752 of the Code),  (c) the  amount of any Losses (as  defined in
Exhibit C)  allocated  to such  Member  pursuant  to Section  8.2(b) and (d) the
amount of any special allocation of deductions or losses to such Member pursuant
to Section 2.1 of Exhibit C. The foregoing  Capital  Account  definition and the
other  provisions  of this  Agreement  relating  to the  maintenance  of Capital
Accounts are intended to comply with  Regulation  ss.  1.704-1(b),  and shall be
interpreted and applied in a manner consistent with such Regulations.

     8.2 Allocations.

     (a) Except as  provided in Section 2.1 of Exhibit C, and subject to Section
2.2 of Exhibit C, any Profits realized by the Company for a Fiscal Year shall be
allocated among the Members as follows and in the following order of priority.

                                       13
<PAGE>

          (i) First,  Profits shall be allocated among the Members in proportion
     to the deficit balances in their  respective  Capital  Accounts,  until the
     deficit balance in each such Member's Capital Account has been eliminated.

          (ii) Next,  Profits  shall be  allocated  to  Killington  to the least
     extent  necessary to cause its Capital  Account balance to equal the sum of
     its Unpaid Preferred Return and its Unrecovered Preference Amount.

          (iii)  Then,  all  remaining  Profits  shall be  allocated  among  the
     Members,   pro  rata  in  accordance  with  their   respective   Membership
     Percentages.

     (b) Except as  provided in Section 2.1 of Exhibit C, and subject to Section
2.2 of Exhibit C, any Losses  realized by the Company for a Fiscal Year shall be
allocated among the Members as follows and in the following order of priority.

          (i) First,  Losses shall be allocated  among the Members in proportion
     to their respective  Membership  Percentages,  until  Killington's  Capital
     Account  balance  is  reduced  to an amount  equal to the sum of its Unpaid
     Preferred Return and its Unrecovered Preference Amount.

          (ii) Next,  Losses shall be allocated  among those  Members other than
     Killington in  proportion  to their  respective  positive  Capital  Account
     balances,  until the Capital  Account  balance of each such other Member is
     reduced to zero (0).

          (iii) Next,  Losses shall be allocated to Killington until its Capital
     Account balance is reduced to zero (0).

          (iv) Then, all remaining  Losses shall be allocated  among the Members
     according to their respective Membership Percentages.

     8.3 Distributions.  Subject to the provisions of Section 9.2, undistributed
Cash Flow, if any, in excess of reserves provided for in the definition of "Cash
Flow," shall be distributed to the Members periodically as follows:

     (a) First,  to the applicable  Member(s) in proportion to and to the extent
of the principal and interest owed to such Member(s)  under any Member Loans (to
be applied first to interest and then to principal) made by the Member(s) to the
Company pursuant to Section 3.2;

     (b) Second,  to Killington  until its the Unpaid  Preferred Return has been
reduced to zero (0);

     (c) Third, to Killington until its Unrecovered  Preference  Amount has been
reduced to zero (0); and

     (d) Fourth,  to the Members,  pro rata in accordance with their  respective
Membership Percentages.

                                       14
<PAGE>

     8.4  Withholding.  The  Managing  Member is  authorized  to  withhold  from
distributions  to the  Members  and to pay  over  to  federal,  state  or  local
government  authorities any amounts  required to be so withheld  pursuant to the
Code or any other applicable federal,  state or local law and shall allocate any
amounts so withheld to the  Members.  Any amounts so allocated to a Member shall
be treated as an amount  distributed  to such Member  pursuant to this Article 8
for all purposes of this Agreement.

     8.5 Final Distribution. The final distributions following dissolution shall
be made in accordance with the provisions of Section 9.2.

                                   ARTICLE 9

                                  DISSOLUTION

     9.1  Dissolving  Events.  The  Company  shall be  dissolved  in the  manner
hereinafter provided upon the happening of any of the following events:

     (a)  the  written  agreement  of the  Members  holding  51% or  more of the
Membership Interests in the Company to terminate the Company;

     (b) the disposition of all or  substantially  all of the Company Assets and
the collection of all amounts derived from any such  disposition,  including all
amounts payable to the Company under any promissory  notes or other evidences of
indebtedness derived by the Company from any such disposition; or

     (c) any other event which under  applicable law would cause the dissolution
of the Company,  provided,  however, that, unless required by law or objected to
by Members holding 51 % or more of the Membership  Interests in the Company, the
Company  shall not be  liquidated  as a result of any such event and the Company
shall be reconstituted.

     9.2  Methods  of   Liquidation.   If  the  Company  is  dissolved  and  not
reconstituted,  an accounting of the Company assets,  liabilities and operations
through the last day of the month in which the dissolution  occurs shall be made
by the  Managing  Member,  and the affairs of the Company  shall be wound up and
terminated.  The Managing Member shall serve as the  liquidating  trustee of the
Company.  The  liquidating  trustee  shall be  responsible  for  winding  up and
terminating  the  affairs of the  Company  and shall  determine  all  matters in
connection therewith  (including the arrangements to be made with creditors,  to
what  extent and under what terms the assets of the  Company  are to be sold and
the amount or necessity of cash reserves to cover contingent  liabilities) as it
deems advisable and proper.  The liquidating  trustee thereafter shall liquidate
the assets of the Company as promptly as is consistent  with  obtaining the fair
value thereof,  and the proceeds therefrom,  to the extent sufficient  therefor,
shall be applied and distributed in accordance with the following:

     (a) First,  to the  payment of the debts and  liabilities  of the  Company,
other than to the Members,  and to the expenses of  liquidation  in the order of
priority as provided by law; then

                                       15
<PAGE>

     (b) Second,  to the  establishment  of, or addition to, any reserves deemed
necessary  by  the   liquidating   trustee  for  any  contingent  or  unforeseen
liabilities  or  obligations of the Company;  provided,  however,  that any such
reserves established  hereunder may be paid over to a bank or other escrow agent
to be held in escrow for the purpose of paying any such contingent or unforeseen
liabilities  or  obligations  and,  at the  expiration  of  such  period  as the
liquidating  trustee  deems  advisable,  of  distributing  the  balance  of such
reserves in the manner provided hereinafter in this Section 9.2; then

     (c) Third,  to the Members in  accordance  with the order and  priority set
forth in Section 8.3 (and subject to the provisions of Sections 8.4 ).

     The vote of Members  [holding 51 % or more of the  Membership  Interests in
the  Company]  shall be  sufficient  to continue  the life of the Company in the
event a termination of the Company would otherwise have occurred.

     9.3 Reasonable Time for Liquidating. A reasonable time shall be allowed for
the orderly liquidation of the Company's assets pursuant to Section 9.2 above in
order to minimize the losses normally attendant upon such a liquidation.

     9.4 Date of  Liquidation.  The Company shall be liquidated  and  terminated
when all of its assets have been converted  into cash,  all promissory  notes or
other evidences of  indebtedness  derived by the Company from such conversion of
its assets have been  collected  or otherwise  converted  into cash and all such
cash has been applied and  distributed  in  accordance  with the  provisions  of
Section 9.2 above.  The  establishment of any reserves shall not have the effect
of extending the term of the Company,  but such reserves shall be distributed in
accordance  with Section 9.2 and in the manner and within the time period as the
liquidating trustee deems advisable and appropriate.

     9.5  Withdrawals.  The Members do hereby covenant and agree that they shall
not  withdraw  or retire  from the  Company  except  as a result of a  permitted
Transfer of their entire  respective  Membership  Interests  and that they shall
carry out their  duties  and  responsibilities  hereunder  until the  Company is
terminated, liquidated and dissolved under this Article 9.

                                   ARTICLE 10

                           SALE; ASSIGNMENT; TRANSFER

     10.1 Transfers of Interests in Company.

     (a) No Member may sell, transfer, assign, convey or otherwise dispose of or
Pledge or encumber,  either directly or indirectly,  voluntarily or by operation
of law (collectively,  "Transfer"),  all or any part of its Membership  Interest
without  the  prior  written  consent  of all  other  Members.  Any  such act in
violation of this Section 10.1(a) shall be null and void ab initio. The approval
of any such  transaction in any one or more  instances  shall not limit or waive
the requirement for such approval in any other or future  instance.  In no event
shall  less  than  all  of the  Membership  Interest  of a  Member  be  directly
Transferred by any Member.

                                       16
<PAGE>

     10.2 Restraining Order; Specific Performance; Other Remedies.

     (a) In the event  that any Member  shall  attempt  to  Transfer  all or any
portion of any Membership Interest in the Company in violation of the provisions
of this  Agreement and any rights hereby  granted,  then the other  Members,  in
addition to all rights and remedies hereunder, at law and/or in equity, shall be
entitled to a decree or order  restraining and enjoining such Transfer,  and the
offending  party  shall not plead in  defense  thereto  that  there  would be an
adequate remedy at law; it being hereby  expressly  acknowledged and agreed that
damages at law shall be an inadequate  remedy for a breach or threatened  breach
or violation of the provisions concerning Transfers set forth in this Agreement.

     (b) In addition,  it is expressly  agreed that the remedy at law for breach
of any of the obligations set forth in Section 10.1 is inadequate in view of (i)
the complexities and uncertainties in measuring the actual damages that would be
sustained  by reason of the failure of a party to comply fully with each of said
obligations and (ii) the uniqueness of each Member's business and assets and the
relationship  of the  Members.  Accordingly,  in addition to all other  remedies
available at law or in equity,  each of the aforesaid  obligations shall be, and
is hereby expressly made, enforceable by specific performance.

     10.3  Compliance  with Law. The Members  hereby agree that no sale or other
Transfer of any interest in the Company  shall be made which would result in (a)
the violation of any  applicable  law,  order,  rule or regulation of the United
States of America or the States of Delaware or Vermont to the extent  applicable
to such sale or other  Transfer,  including the United States  Securities Act of
1933, as amended, or (b) a breach or default under the terms of any Mortgage.

     10.4 Substitute  Members.  In the event any Member Transfers its Membership
Interest  in  compliance  with the other  provisions  of this  Article  10,  the
transferee  thereof shall have the right to become a  substituted  Member of the
Company only upon satisfaction of the following:

     (a) the transferring  Member and its transferee execute such instruments as
any other  Member  deems  reasonably  necessary  or  desirable  to  effect  such
substitution;

     (b) the transferee  accepts and agrees in writing to be bound by all of the
terms and provisions of this Agreement; and

     (c) such  transferee pays a transfer fee to the Company which is sufficient
to cover all reasonable  expenses,  including  attorneys' and accountants' fees,
transfer taxes and expenses incurred by the Company or its Members in connection
with the  admission of such Person as a Member,  including any amendment to this
Agreement.

     10.5  Section 754  Election.  Upon the  request of any Member  transferring
substantially  all of its  Membership  Interest in the Company  pursuant to this
Agreement,  or upon the request of the  transferee,  the  Company  shall file an
election  pursuant  to  section  754 of the Code to adjust  the basis of Company
property in the manner provided in section 743 of the Code. The incremental cost
of making  such an election  shall be borne by the  requesting  party;  provided
that, if the requesting  party is the  transferor  and such  transferor is not a
Member immediately after such transfer,  or subsequently  ceases to be a Member,
such cost shall be borne by the transferee.

                                       17
<PAGE>

     10.6  Release of  Liability.  In the event any Member shall sell its entire
interest  in the  Company  (other  than in a sale of the  Company  Assets or the
entire Membership Interests of all Members) in compliance with the provisions of
this Agreement without  retaining any interest therein,  directly or indirectly,
then the transferring  Member shall be relieved of any further liability arising
hereunder for events occurring from and after the date of such Transfer.

                                   ARTICLE 11

                                    NOTICES

     11.1 In Writing; Address. All notices, demands, consents, reports and other
communications  provided  for in this  Agreement  shall be in writing,  shall be
given by a method prescribed in Section 11.2 and shall be given to the Member to
whom it is addressed at the address set forth below or at such other address(es)
as such party hereto may hereafter  specify by at least fifteen (15) days' prior
written notice.

         To ASCRP:               American Skiing Company Resort Properties, Inc.
                                136 Heber Avenue, Suite 303
                                P.O. Box 4552 Park City, Utah 84060
                                Attn: BJ Fair Fax: (435) 615-3484

         With a copy to:        American Skiing Company
                                One Monument Way
                                Portland, Maine 04101
                                Attn:  Foster Stewart
                                Fax: (207) 791-2607

         To Killington:         Killington, Ltd.
                                4763 Killington Access Road
                                Killington, Vermont 05751-4746
                                Attn: Allen W. Wilson
                                Fax: (802) 422-6762

         With a copy to:        American Skiing Company
                                One Monument Way
                                Portland, Maine 04101
                                Attn:  Foster Stewart
                                Fax: (207) 791-2607

     Any party  hereto may change the address to which  notice may be  delivered
hereunder  by the  giving of  written  notice  thereof  to the other  Members as
provided in Section 11.2 below.

                                       18
<PAGE>

     11.2  Method.  Such notice or other  communication  may be mailed by United
States certified mail, return receipt requested, postage prepaid, deposited in a
United  States post  office or a  depository  for the receipt of mail  regularly
maintained by the Post Office. Such notices,  demands,  consents and reports may
also be delivered (i) by hand or nationally  recognized  overnight courier which
maintains  evidence of receipt or (ii) by  facsimile  with a  confirmation  copy
delivery by overnight courier which maintains evidence of receipt.  Any notices,
demands, consents or other communications shall be deemed given when received at
the  address  for  which  such  party has given  notice in  accordance  with the
provisions  hereof  if  received  on a  Business  Day and if not  received  on a
Business Day, then on the next Business Day.  Notwithstanding the foregoing,  no
notice or other  communication shall be deemed ineffective because of refusal of
delivery to the address  specified  for the giving of such notice in  accordance
herewith.  Notice  shall be  effective  only upon  receipt or refusal of receipt
after  delivery in  accordance  with the methods  hereinabove  set forth in this
Section 11.2.

                                   ARTICLE 12

                                  MISCELLANEOUS

     12.1 Additional  Documents and Acts. In connection with this Agreement,  as
well as all transactions  contemplated by this Agreement,  each Member agrees to
execute and deliver such  additional  documents and  instruments  and to perform
such additional acts as may be necessary or appropriate to effectuate, carry out
and perform all of the terms,  provisions  and  conditions of this Agreement and
all such transactions.

     12.2  Governing  Law and  Jurisdiction.  This  Agreement,  the  rights  and
obligations  of the parties hereto and any claims or disputes  relating  thereto
shall be governed by and construed in  accordance  with the laws of the State of
Delaware (other than the choice of law rules).

     12.3 Pronouns.  All pronouns and any variations  thereof shall be deemed to
refer to the masculine,  feminine or neuter, singular or plural, as the identity
of the Person or Persons may require.

     12.4 Entire Agreement.  This instrument  contains all of the understandings
and agreements of whatsoever kind and nature existing between the parties hereto
with  respect  to this  Agreement  and the  rights,  interests,  understandings,
agreements and obligations of the respective parties pertaining to the formation
and continuing  operations of the Company.  Representatives  of all parties have
participated  equally in the  negotiation  and drafting of this  Agreement,  and
accordingly,  this Agreement  shall not be more strictly  construed  against any
party hereto on account of the role played by such party's representative in the
negotiation and drafting hereof.

     12.5  References  to this  Agreement.  Numbered  or lettered  Articles  and
Sections  herein  contained  refer to Articles  and  Sections of this  Agreement
unless otherwise expressly stated.

                                       19
<PAGE>

     12.6 Headings.  All headings  herein are inserted only for  convenience and
ease  of  reference  and  are  not  to be  considered  in  the  construction  or
interpretation of any provision of this Agreement.

     12.7 Binding Effect. Except as herein otherwise expressly stipulated to the
contrary,  this Agreement  shall be binding upon and inure to the benefit of the
parties hereto and their respective heirs, legal representatives, successors and
permitted assigns.

     12.8  Counterparts.   This  Agreement  may  be  executed  in  a  number  of
counterparts,  each of which shall be deemed an original  and all of which shall
constitute one and the same Agreement.

     12.9  Amendments.  This  Agreement may not be amended,  altered or modified
except by a written instrument signed by each of the Members.

     12.10 Estoppel Certificates. Each Member agrees, upon written demand of any
other  Member,  to execute and deliver to the other  Member(s),  within ten (10)
days after such demand (which  demand shall make  reference to such ten (10) day
response period), a certificate stating that this Agreement is unmodified and in
full force and effect (or, if this Agreement has been modified, that the same is
in full force and effect as modified and stating such modifications), whether or
not, to the best  knowledge  of such Member,  there exists any material  default
hereunder  and if so,  specifying  the  details of such  default  and such other
matters as the other Member(s) may reasonably request.

     12.11 Exhibits.  All Exhibits  attached hereto are  incorporated  herein
and made a part hereof by this reference.

     12.12 Severability. Every provision of this Agreement is hereby declared to
be independent of, and separable from,  every other provision of this Agreement.
If any  such  provisions  shall be held to be  invalid  or  unenforceable,  that
holding shall be without effect upon the validity or enforceability of any other
provision of this Agreement.  It is the intention of the parties hereto that, in
lieu of each  provision of this  Agreement  which is determined to be invalid or
unenforceable,  there  shall  be  added,  as  part of  this  Agreement,  such an
alternative  provision as may be valid or enforceable  but otherwise as close to
the applicable original provision as possible.

     12.13 Waiver; Modification. Failure by any Member to insist upon or enforce
any of its rights  shall not  constitute  a waiver  thereof,  and nothing  shall
constitute a waiver of such Member's right to insist upon strict compliance with
the  provisions  hereof.  Any Member may waive the benefit of any  provision  or
condition for its benefit contained in this Agreement.

     12.14  Third-Party  Beneficiaries.   This  Agreement  is  made  solely  and
specifically  between  and for the  benefit  of the  parties  hereto  and  their
respective  successors  and  assigns  subject to the express  provisions  hereof
relating  to  Transfers,  and no other  Person or party  shall have any  rights,
interest or claims  hereunder or be entitled to any benefits under or on account
of this Agreement as a third-party beneficiary or otherwise.

                                       20
<PAGE>

     12.15  Reliance  on  Authority  of  Person  Signing  Agreement;  Designated
Representatives; Authority of Managing Member.

     (a) In the event that a Member is a partnership, limited liability company,
limited  partnership,  joint  venture,  corporation  or any entity  other than a
natural  person,  the  Members  and the  Company  (i) shall not be  required  to
determine  the  authority  of the  Person  signing  this  Agreement  to make any
commitment or  undertaking  on behalf of such entity or to determine any fact or
circumstance  bearing upon the existence of the  authority of such Person;  (ii)
shall not be required to see to the application or distribution of proceeds paid
or  credited to Persons  signing  this  Agreement  or any  document  executed in
connection  herewith  on behalf of such  entity;  and (iii) shall be entitled to
rely on the  authority of the Person  signing this  Agreement or any document in
connection  herewith  with respect to the voting of the  Membership  Interest of
such  entity and with  respect to the giving of consent on behalf of such entity
in connection  with any matter for which consent is permitted or required  under
this Agreement or any document in connection herewith.

     (b) Each  Member  shall  designate  in writing to the  Company  one or more
representatives  who shall be authorized to act under this  Agreement for and on
behalf of such Member. Any act, approval,  consent or vote of any representative
of a Member  that is so  designated  shall be  deemed  to be the act,  approval,
consent or vote of said  Member,  and no Person,  including  the Company and the
other  Members,  shall  be  required  to  inquire  into  the  authority  of such
representative as to such act, approval, consent or vote on behalf of the Member
who has designated said representative.  Any representative may be replaced by a
successor  representative  by written notice to the Company and designation of a
substitute for such representative.  Until written notice of any change is given
pursuant   to  Article   11,   the   designated   representatives   ("Designated
Representative(s)") of the Members shall be as provided on Exhibit B.

     (c) In dealing  with the  Managing  Member,  no Person shall be required to
inquire as to its authority to bind the Company.  Any act of the Managing Member
purporting to bind the Company shall bind the Company. The Managing Member shall
have the full right and authority to execute and deliver any and all agreements,
contracts, documents and instruments relating to the business and affairs of the
Company  without the joinder of the other Members or any other  Person,  and any
Person  dealing with the Company may rely upon the Managing  Member's  execution
and delivery of any agreement,  contract,  document or instrument as the act and
deed  of  the  Company,   without  the   necessity   for  further   inquiry  and
notwithstanding any other provision of this Agreement.

     12.16 Indemnity.  Except as provided in this Section 12.16, the Company, to
the extent of its assets,  shall and does hereby  indemnify the Managing  Member
and any Officers of the Company against,  and agree to hold, save and defend the
Managing  Member and any such Officers  wholly  harmless  from,  any  liability,
claim, cause of action, loss, expense or damage (including reasonable attorneys'
fees and expenses  and court costs  actually  incurred)  suffered or incurred by
such party by reason of anything the Managing  Member or any such Officer may in
good faith do or refrain from doing for or on behalf of the  Company;  provided,
however, that the Company shall not be required to indemnify the Managing Member
or any such Officer for any liability,  claim, cause of action, loss, expense or
damage which such the Managing Member or any such Officer may suffer or incur as
a result of its fraud, willful misconduct or gross negligence.

                                       21
<PAGE>

     12.17 Herein. Wherever used in this Agreement, the words "herein," "hereof"
or words of similar  import  shall be deemed to refer to this  Agreement  in its
entirety and not to a specific section unless otherwise stated.

     12.18  Including.  Wherever used in this  Agreement,  the word  "including"
shall be deemed to mean "including, without limitation."

     12.19 Cost of  Counsel.  In any  judicial  action  between  the  parties to
enforce any of the  provisions of this Agreement or any right of any party under
this Agreement, regardless of whether such action or proceeding is prosecuted to
judgment and in addition to any other remedy,  the unsuccessful  party shall pay
to the prevailing party all costs and expenses,  including reasonable attorneys'
fees and expenses,  incurred  therein by the prevailing party in connection with
such action.

     12.20  Days.  Unless  otherwise  stated,  a day  shall be  deemed to mean a
calendar day.

     12.21 Time of Essence.  Time is the essence of each and every  provision of
this Agreement.

     12.22 General  Exculpation.  Notwithstanding  any  provision  hereof to the
contrary, in no circumstances shall a member,  shareholder,  partner,  director,
officer, employee or agent ("Special Party") of a Member (direct or indirect) or
of a Special Party of a Member hereto (direct or indirect) be personally  liable
for any of the  obligations  of such Member under this  Agreement  except to the
extent, if any, provided in any separate agreement now or hereafter executed and
delivered by such Special Party.

     12.23 Partition. Each of the Members irrevocably waives, during the term of
the Company and during any period of its liquidation  following any dissolution,
any right that it may have to  maintain  any action for  partition  in kind with
respect to any of the assets of the Company.

                  EXECUTED as of the date first above written.

                                      ASCRP:

                                      AMERICAN SKIING COMPANY RESORT
                                      PROPERTIES, INC., a Maine corporation

                                      By:
                                         ---------------------------------------
                                      Name: William J. Fair.
                                      Title:   President



                                      KILLINGTON:

                                      KILLINGTON, LTD.,
                                      a Vermont corporation

                                      By:
                                      Name:
                                      Title:



                                       22
<PAGE>




                                    EXHIBIT A

                     DESCRIPTION OF KILLINGTON PROPERTY AND
                                 ASCRP PROPERTY



     A.   Killington Property:


     B.   ASCRP Property:


                                      A-1

<PAGE>


                                   EXHIBIT A-1

                      DESCRIPTION OF CHERRY KNOLL PROPERTY




                                     A-1-1
<PAGE>



                                    EXHIBIT B

                           DESIGNATED REPRESENTATIVES

                                                 Designated
     Member                                      Representative(s)

     1.   Killington                             Allen W. Wilson

     2.   ASCRP                                  Foster Stewart



                                      B-1
<PAGE>


                                    EXHIBIT C

                                   TAX EXHIBIT

                                    ARTICLE I

                                 TAX DEFINITIONS

     Section 1.1 Definitions.  All capitalized  terms used herein shall have the
following meanings:

          (a)......Adjusted  Capital Account Deficit.  "Adjusted Capital Account
     Deficit" means, with respect to any Member, the deficit balance, if any, in
     such Member's  Capital  Account as of the end of the relevant  fiscal year,
     after giving effect to the following adjustments:

               (i)  Crediting to such Capital  Account (x) any amount which such
          Member is  obligated  to restore  following  the  liquidation  of such
          Member's  Interest  in the  Company  (pursuant  to the  terms  of this
          Agreement or otherwise) and (y) any amount which such Member is deemed
          obligated  to  restore  in  accordance   with   Regulations   Sections
          1.704-1(b)(2)(ii)(c), 1.704-2(g)(1) and 1.704-2(i)(5); and

               (ii)  Debiting to such  Capital  Account the items  described  in
          Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5), and (6).

     This  definition is intended to comply with the  provisions of  Regulations
Section 1.704-1(b)(2)(ii)(d), and will be interpreted consistently therewith.

          (b) Book  Basis.  "Book  Basis"  of any  Company  property  shall
     initially  be equal to the  Company's  initial  adjusted  tax basis in such
     property;  provided, however, that the initial "Book Basis" of any property
     (or portion  thereof)  contributed  to the capital of the Company  shall be
     equal to the fair  market  value of such  property  (as  determined  by the
     Managing  Member).   Effective  immediately  after  giving  effect  to  the
     allocations of Profits and Losses for each Fiscal Year, the "Book Basis" of
     each  Company  property  shall be  adjusted  downward by the amount of Book
     Depreciation  allowable to the Company for such Fiscal Year with respect to
     such property. In addition,  effective immediately prior to any Revaluation
     Event,  the "Book Basis" of each Company property shall be further adjusted
     upward or downward,  as necessary,  so as to equal the fair market value of
     such property at the time of such  Revaluation  Event (as determined by the
     Managing Member taking section 7701(g) of the Code into account (i.e., such
     value  shall  not be  agreed  to be less  than the  amount  of  Nonrecourse
     Liabilities to which such property is subject)).

          (c) Book Depreciation.  "Book  Depreciation"  allowable to the Company
     for any Fiscal Year with respect to any Company  property shall be equal to
     the product of (i) the amount of Tax Depreciation  allowable to the Company
     for such  Fiscal  Year  with  respect  to such  property,  multiplied  by a
     fraction,  the  numerator of which is the  property's  Book Basis as of the
     beginning of such Fiscal Year (or the date of acquisition  or  contribution
     if the  property is acquired or  contributed  during such Fiscal  Year) and
     (ii) the  denominator of which is the  property's  adjusted tax basis as of
     the  beginning  of such  Fiscal  Year  (or the date of  acquisition  if the
     property is acquired  during such Fiscal Year).  If the  denominator of the
     fraction  described  in clause  (ii) above is equal to zero,  the amount of

                                      C-1
<PAGE>

     "Book  Depreciation"  allowable  to the  Company  for any Fiscal  Year with
     respect to the Company  property in question shall be determined  under any
     reasonable method selected by the Managing Member.

          (d) Book/Tax Disparity  Property.  "Book/Tax Disparity Property" shall
     mean any Company property that has a Book Basis which is different from its
     adjusted tax basis to the Company.  Thus,  any property that is contributed
     to the  capital of the Company by a Member  shall be a "Book/Tax  Disparity
     Property" if its initial Book Basis is not equal to the  Company's  initial
     tax basis in the  property.  In addition,  once the Book Basis of a Company
     property is adjusted in connection  with a  Revaluation  Event to an amount
     other  than its  adjusted  tax basis to the  Company,  the  property  shall
     thereafter be a "Book/Tax Disparity Property."

          (e) Member Nonrecourse Debt. "Member  Nonrecourse Debt" shall mean any
     Company  liability  that is treated as  "partner  nonrecourse  debt"  under
     section 1.704-2(b)(4) of the Regulations.

          (f) Member Nonrecourse Deductions.  "Member Nonrecourse Deductions" of
     the  Company  for a  Fiscal  Year  shall  mean  any and all  items  of Book
     Depreciation  and other  expenses that are treated as "partner  nonrecourse
     deductions" under section 1.704-2(i)(2) of the Regulations.

          (g) Member Nonrecourse Minimum Gain. "Member Nonrecourse Minimum Gain"
     of the Company shall mean the amount of "minimum  gain" of the Company that
     is  attributable  to Member  Nonrecourse  Debt (as  determined  strictly in
     accordance with section 1.704-2(i)(3) of the Regulations). A Member's share
     of such "Member Nonrecourse Minimum Gain" shall be calculated in accordance
     with the provisions of section 1.704-2(i)(5) of the Regulations.

          (h) Nonrecourse  Deductions.  "Nonrecourse  Deductions" of the Company
     generally  refers  to any and all  items  of Book  Depreciation  and  other
     expenses  that are  treated  as  "nonrecourse  deductions"  under  sections
     1.704-2(b)(1)  and  (c)  of  the  Regulations.  Subject  to  the  foregoing
     sentence,  the aggregate amount of "Nonrecourse  Deductions" for any fiscal
     Year shall equal the excess (if any) of

               (i) the net  increase in the amount of  Nonrecourse  Minimum Gain
          during such Fiscal Year, over

               (ii) the aggregate amount of any distributions during such Fiscal
          Year of proceeds of a Nonrecourse  Liability  that are allocable to an
          increase in Nonrecourse Minimum Gain.

     (i)  Nonrecourse  Liability.  "Nonrecourse  Liability" of the Company shall
mean any Company  liability  treated as a "nonrecourse  liability" under section
1.752-1(a)(2)   of  the   Regulations.   Subject  to  the  foregoing   sentence,
"Nonrecourse Liability" shall mean any Company liability (or portion thereof) of

                                      C-2
<PAGE>

the Company for which no Member (and no related person to such Member within the
meaning of section  1.752-4(b)  of the  Regulations)  bears the economic risk of
loss  within the  meaning  of  section  1.752-3(a)(3)  of the  Regulations.  For
purposes  of  allocating   "excess   nonrecourse   liabilities"   under  section
1.752-3(a)(3)  of the  Regulations,  the Members  hereby agree that the Members'
interests in Company  profits for purposes of section  1.752-3(a)(3)  shall mean
such percentage as Nonrecourse  Deductions are allocated to the Members for such
Fiscal Year under Section 2.1(e) hereof.

     (j)  Nonrecourse  Minimum Gain.  "Nonrecourse  Minimum Gain" of the Company
shall mean the amount of "minimum gain" of the Company that is  attributable  to
Nonrecourse  Liabilities  (as  determined  strictly in  accordance  with section
1.704-2(d) of the Regulations).  A Member's share of such  "Nonrecourse  Minimum
Gain"  shall  be  calculated  in  accordance  with  the  provisions  of  section
1.704-2(g) of the Regulations.

     (k) Profits or Losses.  "Profits"  or "Losses," as the case may be, for any
period,  means an amount equal to the Company's  Taxable  Income or Taxable Loss
for such period, with the following adjustments:

          (i) Any income of the Company that is exempt from  federal  income tax
     and not  otherwise  taken into  account  in  computing  Profits  and Losses
     pursuant to this  definition  will be added to such Taxable  Income or will
     reduce such Taxable Loss;

          (ii)  Any  expenditure  of  the  Company  described  in  Code  Section
     705(a)(2)(B) or treated as a Code Section 705(a)(2)(B) expenditure pursuant
     to Regulations Section  1.704-1(b)(2)(iv)(i),  and not otherwise taken into
     account in computing Profits or Losses pursuant to this definition, will be
     subtracted from such Taxable Income or Losses;

          (iii) If the Book Basis of any Company  asset is adjusted  pursuant to
     clauses  (ii)-(iv) of the  definition of Revaluation  Event,  the amount of
     such  adjustment  will be  taken  into  account  as gain or loss  from  the
     disposition of such asset for purposes of computing Profits or Losses;

          (iv) Gain or loss resulting from the  disposition of any Company asset
     with  respect to which gain or loss is  recognized  for federal  income tax
     purposes  will be  computed  by  reference  to the Book  Basis of the asset
     disposed of,  notwithstanding  that the adjusted tax basis of such property
     differs from its Book Basis;

          (v) In lieu of the depreciation,  amortization and other cost recovery
     deductions  taken into  account in computing  such Taxable  Income or Loss,
     there will be taken into account Book  Depreciation for such fiscal year or
     other period; and

     Notwithstanding  any other provision of this definition,  any item which is
specially  allocated pursuant to Section 2.1 of this Exhibit C will not be taken
into account in computing Profits or Losses.

                                      C-3
<PAGE>

     (l)  Regulations.  "Regulations"  shall mean the  Income  Tax  Regulations,
including   Temporary   Regulations,   promulgated  under  the  Code,  as  those
regulations may be amended from time to time (including corresponding provisions
of succeeding regulations).

     (m) Revaluation Event.  "Revaluation Event" shall mean any of the following
occurrences:  (i) the  contribution  of money or other property (other than a de
minimis amount) by a new or existing Member to the capital of the Company;  (ii)
the  distribution of money or other property (other than a de minimis amount) by
the Company to a retiring or continuing  Member;  (iii) the  Liquidation  of the
Company; or (iv) any other event so specified in section 1.704-1(b)(2)(iv)(f) of
the Regulations.

     (n) Taxable Income or Taxable Loss.  "Taxable Income" or "Taxable Loss," as
the case may be, for any period, means the taxable income or taxable loss of the
Partnership for such period,  determined in accordance with Code Section 703(a),
including all items of income, gain, loss or deduction.

     (o) Tax Depreciation. "Tax Depreciation" for any Fiscal Year shall mean the
amount of depreciation, cost recovery or other amortization deductions allowable
to the Company for federal income tax purposes for such Fiscal Year.

     (p) Tax Items.  "Tax Items" shall mean,  with respect to any property,  all
items of income, gain, loss, deduction,  and credit (including Tax Depreciation)
recognized  by or allowable to the Company  with  respect to such  property,  as
computed for federal income tax purposes.

                                   ARTICLE II

              REGULATORY ALLOCATIONS AND SECTION 704(C) ALLOCATIONS

     Section 2.1 Allocations Required by Regulations.

     (a)  Nonrecourse  Minimum  Gain.  Pursuant  to  Section  1.704-2(f)  of the
Regulations  (relating to minimum gain chargebacks),  notwithstanding  any other
provision of this Section 2.1, if there is a net decrease in Nonrecourse Minimum
Gain of the  Company  for such  Fiscal  Year (or if there was a net  decrease in
Nonrecourse  Minimum  Gain for a prior  Fiscal Year and the Company did not have
sufficient  amounts of income  during  prior  Fiscal  Years to  allocate  to the
Members under this Section 2.1(a)),  then items of Company gross income and gain
shall  be  allocated,  before  any  other  allocation  is made  pursuant  to the
succeeding  provisions  of this Section 2.1 for such Fiscal Year, to each Member
in proportion  to, and to the extent of, the total net decrease in such Member's
share of the  Nonrecourse  Minimum Gain  (determined  and adjusted in accordance
with  the  provisions  of  Section  1.704-2(g)  of the  Regulations);  provided,
however, that the provisions of this clause shall not apply to any Member to the
extent described in Section 1.704-2(f) of the Regulations.

     As  provided in Section  1.704-2(j)(2)  of the  Regulations,  income of the
Company  allocated  for any Fiscal Year under this Section  2.1(a) shall consist
first of items of gain  recognized  from the  disposition  of  Company  property
subject to Nonrecourse  Liabilities,  with any remaining allocated income deemed

                                      C-4
<PAGE>

to be made up of a pro rata portion of the  Company's  other items of income and
gain for such Fiscal Year (provided  that gain from the  disposition of property
which is  subject  to Member  Nonrecourse  Debt  shall be  allocated  under this
Section 2.1(a) only to the extent not allocated  under Section  2.1(b)  hereof).
This  Section  2.1(a) is intended to comply  with the  minimum  gain  chargeback
requirement in Section  1.704-2(f) of the  Regulations  and shall be interpreted
consistently therewith.

     (b) Member  Nonrecourse  Minimum  Gain.  Except as  otherwise  provided  in
Section  1.704-2(i)  of the  Regulations,  if there is a net  decrease in Member
Nonrecourse  Minimum  Gain for a Fiscal Year (or if there was a net  decrease in
Member Nonrecourse  Minimum Gain for a prior Fiscal Year and the Company did not
have  sufficient  amounts of income during prior Fiscal Years to allocate to the
Members under this Section  2.1(b)),  then items of Company  income and gain for
such Fiscal Year shall be specially  allocated,  before any other  allocation is
made pursuant to the  succeeding  provisions of this Section 2.1 for such Fiscal
Year,  to the Members  with shares of such  minimum  gain as of the first day of
such Fiscal Year in proportion  to, and to the extent of, such Member's share of
the net  decrease in such minimum  gain  (determined  in a manner and subject to
exceptions  consistent  with those referred to in Section 2.1(a) hereof,  all as
provided under Section 1.704-2(i)(4) of the Regulations). This Section 2.1(b) is
intended to comply with the  partner  minimum  gain  chargeback  requirement  in
Section  1.704-2(i)(4) of the Regulations and shall be interpreted  consistently
therewith.

     As provided in Sections 1.704-2(i)(4) and 1.704-2(j)(2) of the Regulations,
income of the Company  allocated  for any Fiscal Year under this Section  2.1(b)
shall consist first of items of gain  recognized from the disposition of Company
property subject to Member Nonrecourse Debt, with any remaining allocated income
deemed to be made up of a pro rata portion of the Company's other items of gross
income  and gain for such  Fiscal  Year  (provided  that  items of gain from the
disposition  of property  which is subject to a Nonrecourse  Liability  shall be
allocated  under this  Section  2.1(b)  only to the extent not  allocated  under
Section 2.1(a) hereof).

     (c)  Qualified  Income  Offset.  If any Member  unexpectedly  receives  any
adjustment,   allocation  or  distribution  described  in  Regulations  Sections
1.704-1(b)(2)(ii)(d)(4), (5) or (6), that, after tentatively taking into account
all  allocations  that would be made for the current period under this Agreement
(other  than  allocations  pursuant  to this  Section  2.1(c)),  would  cause or
increase an Adjusted Capital Account  Deficit,  items of Company income and gain
will be specially allocated to such Member in an amount and manner sufficient to
eliminate,  to the extent required by the Regulations under Code Section 704(b),
the Adjusted  Capital Account  Deficit as quickly as possible,  provided that an
allocation  pursuant  to this  Section  2.1(c)  shall be made only if and to the
extent such Member  would have an Adjusted  Capital  Account  Deficit  after all
other  allocations  provided  for in this  Section  2.1 and  Section  8.2 of the
Agreement  have  been  tentatively  made  as if this  Section  2.1(c)  were  not
contained  herein.  This Section is intended to comply with the qualified income
offset  requirement  in  Regulations  Section  1.704-1(b)(2)(ii)(d)  and will be
interpreted  consistently therewith.  Allocations under this Section 2.1(c) will
be  comprised of a pro rata  portion of each item of Company  income  (including
gross income) and gain for the year.

     (d)  Preventative  Allocation.  If any Member would have a deficit  Capital
Account  balance at the end of any Company fiscal year which is in excess of the
sum of (i) the amount  such  Member is  obligated  to restore to the  Company on

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liquidation, (ii) such Member's share of the partnership's minimum gain debt (as
defined in  Regulations  Sections  1.704-2(b)(2)  and (d)) as of the end of such
fiscal  year,  and (iii) such  Member's  share of partner  minimum gain debt (as
defined in  Regulations  Section  1.704-2(i)) as of the end of such fiscal year,
each such Member will be specially allocated items of Company income and gain in
the amount of such excess as quickly as possible. Allocations under this Section
2.1(d) will be comprised  of a pro rata  portion of each item of Company  income
(including gross income) and gain for the year.

     (e) Overall Limitation on Allocation of Losses.  Notwithstanding  any other
provision of this  Agreement,  no Losses will be allocated to any Member if such
allocation  would cause or increase an Adjusted  Capital Account Deficit in such
Member's Capital  Account.  If the Capital Account of any Member would otherwise
have an Adjusted Capital Account Deficit at any time when the Capital Account of
any other Member would not otherwise have an Adjusted  Capital Account  Deficit,
the  limitation set forth in this Section 2.1(e) shall be applied on a Member by
Member basis so as to allocate the maximum permissible deduction or loss to each
Member under Regulations Section 1.704-1(b)(2)(ii)(d).  In the event any loss or
deduction  shall be specially  allocated to a Member  pursuant to the  preceding
sentence,  an equal amount of income of the Company shall be specially allocated
to such Member prior to any allocation pursuant to Section 8.2 of the Agreement.

     (f)  Member  Nonrecourse  Deductions.  All  Member  Nonrecourse  Deductions
attributable  to a Member  Nonrecourse  Debt  shall be  allocated  to the Member
bearing  the  economic  risk of loss for such debt within the meaning of Section
1.752-2 of the Regulations with respect to the Member  Nonrecourse Debt to which
such Member  Nonrecourse  Deductions are attributable in accordance with Section
1.704-2(i)(1) of the Regulations;  provided,  however, that if each Member bears
some portion of the economic risk of loss for such debt, the Member  Nonrecourse
Deductions  attributable  to such  debt  shall be  allocated  to and  among  the
Members,  pro rata in the same proportion that their economic risks of loss bear
to one another.

     (g) Nonrecourse Deductions. For any Fiscal Year, all Nonrecourse Deductions
shall be allocated among the Members in proportion to their  respective  Capital
Account balances as determined  immediately  prior to the allocations under this
Section 2.1(g).

     (h)  Curative  Allocations.  The  allocations  set forth in Section  2.1(a)
through 2.1(g)  ("Regulatory  Allocations")  are intended to comply with certain
requirements  of Regulations  Sections  1.704-1(b)  and 1.704-2.  The Regulatory
Allocations may not be consistent with the manner in which the Members intend to
divide  Company  distributions.  Accordingly,  the  Managing  Member  is  hereby
authorized to divide other allocations of Profits, Losses, and other items among
the Members so as to prevent the  Regulatory  Allocations  from  distorting  the
manner in which Company distributions will be divided among the Members pursuant
to this  Agreement.  In  general,  the  Members  anticipate  that  this  will be
accomplished by specially allocating other Profits, Losses, and items of income,
gain,  loss and  deduction  among  the  Members  so that the net  amount  of the
Regulatory Allocations and such special allocations to each such Person is zero.
However,  the Managing  Member will have discretion to accomplish this result in
any reasonable manner.

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          (i) Allocation Savings Provision.  Profits, Losses, and items thereof,
     of the Company  are  intended to be  allocated  hereunder  in a manner that
     would cause the distributions to be made to the Members in respect of their
     respective  Interests in the order and priority set forth in Section 8.3 of
     the  Agreement,  while  at the same  time  complying  with  the  applicable
     requirements  of  Subchapter  K of Chapter 1 of  Subtitle A of the Code (in
     particular,   Section  704   thereof)  and  the   Regulations   promulgated
     thereunder.  Notwithstanding anything in this Exhibit C or in the Agreement
     to the  contrary,  the  Managing  Member shall have the  authority,  and is
     hereby  directed,  to amend this  Exhibit C and/or the  Agreement,  without
     further approval,  authorization or consent of the Members,  to correct any
     allocation provision hereunder as necessary to fulfill the intent described
     in the preceding sentence.

     Section 2.2 Allocation of Tax Items.

     (a) General.  Except as otherwise  provided in Section 2.2(b) hereof,  each
Tax Item  shall be  allocated  among  the  Members  in the same  manner  as each
correlative  item  comprising  Profits and Losses are allocated  pursuant to the
provisions of Section 8.2 of the Agreement or Section 2.1 of this Exhibit C.

     (b) Book/Tax  Disparity  Property.  The Members hereby acknowledge that all
Tax Items in respect of Book/Tax Disparity Property are required to be allocated
among the Members  under  Section  704(c) of the Code (as  specified in Sections
1.704-1(b)(2)(iv)(f)  and  1.704-1(b)(2)(iv)(g) of the Regulations) and that the
principles  of Section  704(c) of the Code  require  that such Tax Items must be
shared  among the  Members so as to take  account of the  variation  between the
adjusted  tax basis and Book  Basis of each such  Book/Tax  Disparity  Property.
Thus, notwithstanding anything in Sections 2.1 or 2.2(a) hereof to the contrary,
the  Members'  distributive  shares of Tax  Items in  respect  of each  Book/Tax
Disparity  Property  shall be  separately  determined  and  allocated  among the
Members in accordance  with the  principles of Section  704(c) of the Code,  the
Regulations thereunder and Regulations Section  1.704-1(b)(4)(i),  utilizing the
traditional  method specified in Section  1.704-3(b) of the Regulations which is
elected by the  Managing  Member.  Any  election or other  decision  relating to
allocations  pursuant  to this  Section  2.2(b)  shall  be made by the  Managing
Member. Allocations pursuant to this Section 2.2(b) are for purposes of federal,
state and local  taxes  only and  shall not  affect or in any way be taken  into
account in computing any Member's  Capital  Account balance or share of Profits,
Losses or distributions pursuant to any provision of the Agreement.

     (c) Recapture Items. For purposes of determining the nature (as ordinary or
capital) of any item of income or gain  allocated  among the Members for Federal
income tax  purposes,  the portion of such profit  required to be  recognized as
ordinary  income  pursuant  to  Sections  1245  and/or 1250 of the Code shall be
deemed to be allocated  among the Members in the same  proportion that they were
allocated  and claimed the Tax  Depreciation  deductions,  or basis  reductions,
directly or indirectly  giving rise to such treatment under Sections 1245 and/or
1250 of the Code,  but each  Member  shall be  allocated  recapture  only to the
extent that such  Member is  allocated  any taxable  gain from the sale or other
disposition of such property.  The balance of such  recapture,  if any, shall be
allocated to the Members whose share of taxable gain exceeds their share of such
recapture  ("excess  gain"),  and such balance  shall be allocated  between such
Members in the  proportion  in which the excess gain of such Member bears to the
excess gains of all Members.

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