(Multicurrency-Cross Border)


                                     ISDA(R)
                  International Swap Dealers Association, Inc.



                                MASTER AGREEMENT

                             dated as of May 12,1998





BankBoston, N.A.                   and                 American Skiing Company


have entered and/or anticipate  entering into one or more  transactions  (each a
"Transaction")  that are or will be  governed  by this  Master  Agreement  which
includes the schedule (the  "Schedule"),  and the documents and other confirming
evidence (each a "Confirmation")  exchanged between the parties confirming those
Transactions.

Accordingly, the parties agree as follows:-

1.       Interpretation

(a)  Definitions.  The terms defined in Section 14 and in the Schedule will have
the meanings therein specified for the purpose of this Master Agreement.

(b) Inconsistency.  In the event of any inconsistency  between the provisions of
the Schedule and the other  provisions  of this Master  Agreement,  the Schedule
will prevail.  In the event of any  inconsistency  between the provisions of any
Confirmation   and  this  Master  Agreement   (including  the  Schedule),   such
Confirmation will prevail for the purpose of the relevant Transaction.

(c) Single Agreement.  All Transactions are entered into in reliance on the fact
that this Master Agreement and all Confirmations form a single agreement between
the  parties  (collectively  referred to as this  "Agreement"),  and the parties
would not otherwise enter into any Transactions.

2.       Obligations

(a) General Conditions.

         (i) Each party will make each  payment or delivery  specified.  in each
         Confirmation to be made by it, subject to the other  provisions of this
         Agreement.

         (ii)  Payments  under this  Agreement  will be made on the due date for
         value  on that  date  in the  place  of the  account  specified  in the
         relevant  Confirmation  or  otherwise  pursuant to this  Agreement,  in
         freely  transferable  funds and in the manner customary for payments in
         the required currency.  Where settlement is by delivery (that is, other
         than by  payment),  such  delivery  will be made for receipt on the due
         date  in the  manner  customary  for  the  relevant  obligation  unless
         otherwise  specified in the relevant  Confirmation or elsewhere in this
         Agreement.

         (iii) Each obligation of Each party under Section 2(a)(i) is subject to
         (1) the condition precedent that no Event of Default or Potential Event
         of  Default  with  respect  to the  other  party  has  occurred  and is
         continuing,  (2) the condition precedent that no Early Termination Date
         in respect of the relevant Transaction has occurred or been effectively
         designated and (3) each other applicable  condition precedent specified
         in this Agreement.

(b) Change of  Account.  Either  party may change its  account  for  receiving a
payment  or  delivery  by giving  notice to the other  party at least five Local
Business Days prior to the  scheduled  date for the payment or delivery to which
such change  applies unless such other party gives timely notice of a reasonable
objection to such change.

(c) Netting. If on any date amounts would otherwise be payable:-

        (i)    in the same currency; and

        (ii)   in respect of the same Transaction,

by each party to the other,  then, on such date, each party's obligation to make
payment of any such amount will be  automatically  satisfied and discharged and,
if the  aggregate  amount that would  otherwise  have been  payable by one party
exceeds the aggregate amount that would otherwise have been payable by the other
party,  replaced by an  obligation  upon the party by whom the larger  aggregate
amount  would  have been  payable  to pay to the other  party the  excess of the
larger aggregate amount over the smaller aggregate amount.

The parties may elect in respect of two or more  Transactions  that a net amount
will be  determined  in respect of all  amounts  payable on the same date in the
same  currency  in  respect of such  Transactions,  regardless  of whether  such
amounts are payable in respect of the same Transaction. The election may be made
in the Schedule or a Confirmation  by specifying  that  subparagraph  (ii) above
will not apply to the Transactions  identified as being subject to the election,
together with the starting date (in which case subparagraph (ii) above will not,
or will cease to, apply to such  Transactions from such date). This election may
be  made  separately  for  different  groups  of  Transactions  and  will  apply
separately to each pairing of Offices through which the parties make and receive
payments or deliveries.

(d)     Deduction or Withholding for Tax.

         (i) Gross-Up.  All payments  under this  Agreement will be made without
         any deduction or  withholding  for or on account of any Tax unless such
         deduction or withholding is required by any applicable law, as modified
         by the practice of any relevant governmental revenue authority, then in
         effect.  If a party is so  required  to deduct or  withhold,  then that
         party ("X") will:-

                  (1) promptly notify the other party ("Y") of such requirement;

                  (2) pay to the relevant  authorities  the full amount required
                  to be deducted or withheld (including the full amount required
                  to be deducted or withheld from any additional  amount paid by
                  X to Y under this  Section 2(d)  promptly  upon the earlier of
                  determining  that such deduction or withholding is required or
                  receiving notice that such amount has been assessed against Y;

                  (3) promptly  forward to Y an official receipt (or a certified
                   copy),  or other  documentation  reasonably  acceptable to Y,
                   evidencing such payment to such authorities; and

                  (4) if such Tax is an Indemnifiable Tax, pay to Y, in addition
                  to the  payment to which Y is  otherwise  entitled  under this
                  Agreement,  such  additional  amount as is necessary to ensure
                  that the net amount actually  received by Y (free and clear of
                  Indemnifiable  Taxes,  whether  assessed  against X or Y) will
                  equal  the  full  amount  Y would  have  received  had no such
                  deduction or withholding been required. However, X will not be
                  required to pay any additional  amount to Y to the extent that
                  it would not be required to be paid but for:-

                    (A) the failure by Y to comply with or perform any agreement
                    contained in Section 4(a)(i), 4(a)(iii) or 4(d); or

                    (B) the  failure of a  representation  made by Y pursuant to
                    Section  3(f) to be accurate  and true  unless such  failure
                    would  not have  occurred  but for (I) any  action  taken by
                    taxing  authority,  or  brought  in  a  court  of  competent
                    jurisdiction, on or after the date on which a Transaction is
                    entered into  (regardless of whether such action is taken or
                    brought with respect to a party to this Agreement) or (II) a
                    Change in Tax Law.

 (ii)   Liability.  If:-

          (1) X is required by any  applicable  law, as modified by the practice
of any  relevant  governmental  revenue  authority,  to make  any  deduction  or
withholding  in respect of which X would not be  required  to pay an  additional
amount to Y under Section 2(d)(i)(4); 

          (2) X does not so deduct or withhold; and

          (3) a liability  resulting from such Tax is assessed  directly against
X, then.  except to the extent Y has  satisfied or then  satisfies the liability
resulting  from such Tax, Y will promptly pay to X the amount of such  liability
(including  any  related  liability  for  interest,  but  including  any related
liability  for  penalties  only if Y has failed to comply  with or  perform  any
agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d)).

(e) Default  Interest;  Other  Amounts.  Prior to the  occurrence  or  effective
designation of an Early Termination Date in respect of the relevant Transaction,
a party that defaults in the performance of any payment  obligation will, to the
extent permitted by law and subject to Section 6(c), be required to pay interest
(before as well as after  judgment) on the overdue  amount to the other party on
demand in the same  currency as such  overdue  amount,  for the period from (and
including)  the  original  due date for payment to (but  excluding)  The date of
actual  payment,  at the Default  Rate.  Such interest will be calculated on the
basis of daily  compounding and the actual number of days elapsed.  If, prior to
the occurrence or effective  designation of an Early Termination Date in respect
of  the  relevant  Transaction,  a  party  defaults  in the  performance  of any
obligation  required to be settled by  delivery,  it will  compensate  the other
party on demand if and to the extent  provided for in the relevant  Confirmation
or elsewhere in this Agreement.

3.       Representations

Each party represents to the other party (which  representations  will be deemed
to be repeated by each party on each date on which a Transaction is entered into
and, in the case of the  representations in Section 3(f), at all times until The
termination of this Agreement) that:-

(a)     Basic Representations.

        (i) Status.  It is duly organized and validly existing under the laws of
        the jurisdiction of its  Organization or incorporation  and, if relevant
        under such laws, in good standing;

        (ii) Powers.  It has the power to execute this  Agreement  and any other
        documentation  relating  to this  Agreement  to which it is a party,  to
        deliver  this  Agreement  and any other  documentation  relating to this
        Agreement  that it is  required  by this  Agreement  to  deliver  and to
        perform its obligations  under this Agreement and any obligations it has
        under any Credit  Support  Document to which it is a party and has taken
        all  necessary   action  to  authorize  such  execution,   delivery  and
        performance;

        (iii) No Violation or Conflict. Such execution, delivery and performance
        do not violate or conflict with any law  applicable to it, any provision
        of its constitutional  documents,  any order or judgment of any court or
        other agency of government  applicable to it or any of its assets or any
        contractual restriction binding on or affecting it or any of its assets;

        (iv) Consents.  All governmental and other consents that are required to
        have been  obtained by it with  respect to this  Agreement or any Credit
        Support  Document to which it is a party have been  obtained  and are in
        full force and effect and all  conditions of any such consents have been
        complied with; and

        (v) Obligations  Binding.  Its obligations  under this Agreement and any
        Credit  Support  Document to which it is a party  constitute  its legal,
        valid and binding  obligations,  enforceable  in  accordance  with their
        respective  terms  (subject to  applicable  bankruptcy,  reorganization,
        insolvency,  moratorium  or similar  laws  affecting  creditors'  rights
        generally and subject, as to enforceability,  to equitable principles of
        general  application  (regardless of whether  enforcement is sought in a
        proceeding in equity or at law)).

(b) Absence of Certain Events. No Event of Default or Potential Event of Default
or, to its knowledge,  Termination  Event with respect to it has occurred and is
continuing  and no such  event or  circumstance  would  occur as a result of its
entering into or performing its  obligations  under this Agreement or any Credit
Support Document to which it is a party.

(c) Absence of Litigation. There is not pending or, to its knowledge, threatened
against it or any of its Affiliates any action,  suit or proceeding at law or in
equity or before any court,  tribunal,  governmental body, agency or official or
any arbitrator that is likely to affect the legality, validity or enforceability
against it of this  Agreement  or any Credit  Support  Document to which it is a
party or its ability to perform its  obligations  under this  Agreement  or such
Credit Support Document.

(d)  Accuracy of  Specified  Information.  All  applicable  information  that is
furnished in writing by or on behalf of it to the other party and is  identified
for the purpose of this  Section  3(d) in the Schedule is, as of the date of the
information, true, accurate and complete in every material respect.

(e) Payer Tax Representation.  Each representation  specified in the Schedule as
being made by it for the purpose of this Section 3(e) is accurate and true.

(f) Payee Tax Representations.  Each representation specified in the Schedule as
being made by it for the purpose of this Section 3(f) is accurate and true.

4.       Agreements

Each party  agrees with the other that,  so long as either party has or may have
any  obligation  under this  Agreement or under any Credit  Support  Document to
which it is a party:-

(a) Furnish  Specified  Information.  It will  deliver to the other party or, in
certain  cases under  subparagraph  (iii) below,  to such  government  or taxing
authority as the other party reasonably directs:-

          (i)  any  forms,   documents  or  certificates  relating  to  taxation
specified in the Schedule or any Confirmation;

          (ii)  any  other   documents   specified   in  the   Schedule  or  any
Confirmation; and

          (iii) - upon  reasonable  demand  by such  other  party,  any  form or
document  that may be required or  reasonably  requested  in writing in order to
allow such other party or its Credit  Support  Provider to make a payment  under
this Agreement or any applicable  Credit Support  Document without any deduction
or  withholding  for  or on  account  of any  Tax  or  with  such  deduction  or
withholding  at a  reduced  rate  (so  long  as  the  completion,  execution  or
submission of such form or document would not materially  prejudice the legal or
commercial position of the party in receipt of such demand),  with any such form
or document to be accurate and completed in a manner reasonably  satisfactory to
such other  party and to be executed  and to be  delivered  with any  reasonably
required  certification,  n each case by The date  specified  in the Schedule or
such Confirmation or, if none is specified, as soon as reasonably practicable.

(b) Maintain  Authorizations.  It will use all reasonable efforts to maintain in
full force and effect all consents of any  governmental  or other authority that
are required to be obtained by it with  respect to this  Agreement or any Credit
Support  Document to which it is a party and will use all reasonable  efforts to
obtain any that may become necessary in the future.

(c)  Comply  with  Laws.  It will  comply  in all  material  respects  with  all
applicable  laws and  orders to which it may be  subject if failure so to comply
would  materially  impair  its  ability to perform  its  obligations  under this
Agreement or any Credit Support Document to which it is a party.

(d) Tax Agreement.  It will give notice of any failure of a representation  made
by it under  Section 3(f) to be accurate and true promptly upon learning of such
failure.

(e)  Payment  of Stamp Tax.  Subject  to  Section  11, it will pay any Stamp Tax
levied or imposed upon it or in respect of its execution or  performance of this
Agreement by a jurisdiction in which it is incorporated,  organized, managed and
controlled,  or  considered  to have its  seat,  or in which a branch  or office
through which it is acting for the purpose of this Agreement is located  ("Stamp
Tax  Jurisdiction")  and will  indemnify  the other party  against any Stamp Tax
levied  or  imposed  upon the other  party or in  respect  of the other  party's
execution or performance  of this  Agreement by any such Stamp Tax  Jurisdiction
which is not also a Stamp Tax Jurisdiction with respect to the other party.

5.       Events of Default and Termination Events

(a) Events of Default. The occurrence at any time with respect to a party or, if
applicable, any Credit Support Provider of such party or any Specified Entity of
such party of any of the following  events  constitutes  an event of default (an
"Event of Default") with respect to such party:-

         (i) Failure to Pay or Deliver.  Failure by the party to make, when due,
         any payment under this Agreement or delivery  under Section  2(a)(i) or
         2(e)  required to be made by it if. such  failure is not remedied on or
         before the third Local  Business  Day after  notice of such  failure is
         given to the party;

         (ii)  Breach of  Agreement.  Failure  by the  party to  comply  with or
         perform any agreement or  obligation  (other than an obligation to make
         any payment under this Agreement or delivery  under Section  2(a)(i) or
         2(e) or to give  notice  of a  Termination  Event or any  agreement  or
         obligation  under  Section  4(a)(i),  4(a)(iii) or 4(d)) to be complied
         with or performed  by the party in  accordance  with this  Agreement if
         such  failure  is not  remedied  on or before the  thirtieth  day after
         notice of such failure is given to the party;

         (iii)   Credit Support Default.

                  (1)  Failure by the party or any Credit  Support  Provider  of
                  such  party  to  comply  with  or  perform  any  agreement  or
                  obligation   to  be  complied  with  or  performed  by  it  in
                  accordance with any Credit Support Document if such failure is
                  continuing after any applicable grace period has elapsed;

                  (2) the  expiration  or  termination  of such  Credit  Support
                  Document  or the  failing or ceasing  of such  Credit  Support
                  Document  to be in full force and  effect  for the  purpose of
                  this  Agreement (in either case other than in accordance  with
                  its terms) prior to the  satisfaction  of all  obligations  of
                  such party under each Transaction to which such Credit Support
                  Document  relates  without  the  written  consent of the other
                  party; or

                  (3) The  party or such  Credit  Support  Provider  disaffirms,
                  disclaims,  repudiates  or  rejects,  in whole or in part,  or
                  challenges the validity of, such Credit Support Document;

         (iv)  Misrepresentation.  A representation (other than a representation
         under Section 3(e) or (f)) made or repeated or deemed to have been made
         or repeated by the party or any Credit  Support  Provider of such party
         in this  Agreement or any Credit Support  Document  proves to have been
         incorrect or misleading in any material resect when made or repeated or
         deemed to have been made or repeated;

         (v) Default under Specified Transaction.  The party, any Credit Support
         Provider of such party or any applicable Specified Entity of such party
         (1) defaults under a Specified  Transaction and, after giving effect to
         any  applicable  notice  requirement  or grace  period,  there occurs a
         liquidation  of, an  acceleration  of  obligations  under,  or an early
         termination of, that Specified Transaction,  (2) defaults, after giving
         effect to any applicable notice  requirement or grace period, in making
         any payment or delivery due on the last  payment,  delivery or exchange
         date  of,  or  any  payment  on  early   termination  of,  a  Specified
         Transaction  (or  such  default  continues  for at  least  three  Local
         Business Days if there is no  applicable  notice  requirement  or grace
         period) or (3) disaffirms,  disclaims,  repudiates or rejects, in whole
         or in part,  a  Specified  Transaction  (or such action is taken by any
         person or entity  appointed  or  empowered  to operate it or act on its
         behalf)-,

         (vi) Cross Default.  If "Cross Default" is specified in the Schedule as
         applying to the party,  the  occurrence  or existence of (1) a default,
         event  of  default  or  other  similar   condition  or  event  (however
         described)  in respect of such party,  any Credit  Support  Provider of
         such party or any applicable  Specified  Entity of such party under one
         or more agreements or instruments relating to Specified Indebtedness of
         any of them  (individually  or  collectively) in an aggregate amount of
         not less than the  applicable  Threshold  Amount (as  specified  in the
         Schedule) which has resulted in such Specified  Indebtedness  becoming,
         or  becoming  capable at such time of being  declared,  due and payable
         under such  agreements or  instruments,  before it would otherwise have
         been due and  payable  or (2) a  default  by such  party,  such  Credit
         Support   Provider   or  such   Specified   Entity   (individually   or
         collectively) in making one or more payments on the due date thereof in
         an aggregate  amount of not less than the applicable  Threshold  Amount
         under  such  agreements  or  instruments  (after  giving  effect to any
         applicable notice requirement or grace period);

          (vii) Bankruptcy. The party, any Credit Support Provider of such party
          or any applicable Specified Entity of such party:-

          (1) is dissolved (other than pursuant to a consolidation, amalgamation
          or merger);

          (2) becomes insolvent or is unable to pay its debts or fails or admits
          in writing  its  inability  generally  to pay its debts as they become
          due;

          (3) makes a general assignment, arrangement or composition with or for
          the benefit of its creditors;

          (4)  institutes or has  instituted  against it a proceeding  seeking a
          judgment of  insolvency  or  bankruptcy  or any other relief under any
          bankruptcy or insolvency law or other similar law affecting creditors'
          rights,  or a petition is presented for its winding-up or liquidation,
          and,  in the case of any such  proceeding  or petition  instituted  or
          presented  against it, such  proceeding  or petition  (A) results in a
          judgment  of  insolvency  or  bankruptcy  or the entry of an order for
          relief or the making of an order for its  winding-up or liquidation or
          (E) is not  dismissed,  discharged,  stayed or restrained in each case
          within 30 days of the institution or presentation thereof;

          (5) has a resolution passed for its winding-up, official management or
          liquidation  (other than pursuant to a consolidation,  amalgamation or
          merger);

          (6) seeks or becomes subject to the  appointment of an  administrator,
          provisional liquidator,  conservator,  receiver, trustee, custodian or
          other  similar  official  for it or for all or  substantially  all its
          assets;

          (7) has a secured party take  possession of all or  substantially  all
          its assets or has a distress, execution, attachment,  sequestration or
          other  legal  process  levied,  enforced  or sued on or against all or
          substantially   all  its  assets  and  such  secured  party  maintains
          possession, or any such process is not dismissed,  discharged,  stayed
          or restrained, in each case within 30 days thereafter;

          (8) causes or is subject to any event with respect to it which,  under
          the applicable laws of any  jurisdiction,  has an analogous  effect to
          any of the events specified in clauses (1) to (7) (inclusive); or

          (9) takes any action in furtherance  of, or indicating its consent to,
          approval of, or acquiescence in, any of the foregoing acts; or

         (viii)  Merger  Without  Assumption.  The party or any  Credit  Support
         Provider of such party consolidates or amalgamates with, or merges with
         or into, or transfers all or  substantially  all its assets to, another
         entity and, at the time of such consolidation,  amalgamation, merger or
         transfer:-

                  (1) the  resulting,  surviving or  transferee  entity fails to
                  assume  all the  obligations  of  such  party  or such  Credit
                  Support  Provider  under this  Agreement or any Credit Support
                  Document  to  which  it or  its  predecessor  was a  party  by
                  operation  of  law  or  pursuant  to an  agreement  reasonably
                  satisfactory to the other party to this Agreement; or

                  (2) the benefits of any Credit Support Document fail to extend
                  (without the consent of the other party) to the performance by
                  such  resulting,   surviving  or  transferee   entity  of  its
                  obligations under this Agreement.

(b) Termination  Events.  The occurrence at any time with respect to a party or,
if applicable, any Credit Support Provider of such party or any Specified Entity
of such party of any event  specified  below  constitutes  an  Illegality if the
event is specified  in (i) below,  a Tax Event if the event is specified in (ii)
below or a Tax Event Upon Merger if the event is specified in (iii) below,  and,
if  specified  to be  applicable,  a Credit  Event  Upon  Merger if the event is
specified pursuant to (iv) below or an Additional Termination Event if the event
is specified pursuant to (v) below:-

         (i)  Illegality.  Due  to  the  adoption  of,  or any  change  in,  any
         applicable  law after the date on which a Transaction  is entered into,
         or due to the promulgation of, or any change in, the  interpretation by
         any court, tribunal or regulatory authority with competent jurisdiction
         of any applicable law after such date, it becomes  unlawful (other than
         as a result of a breach by the party of  Section  4(b)) for such  party
         (which will be the Affected Party):-

                  (1) to perform any absolute or contingent obligation to make a
                  payment or  delivery  or to receive a payment or  delivery  in
                  respect  of such  Transaction  or to  comply  with  any  other
                  material   provision  of  this  Agreement   relating  to  such
                  Transaction; or

                  (2) to  perform,  or for any Credit  Support  Provider of such
                  party to perform, any contingent or other obligation which the
                  party (or such Credit  Support  Provider) has under any Credit
                  Support Document relating to such Transaction;

         (ii) Tax Event. Due to (x) any action taken by a taxing  authority,  or
         brought in a court of competent  jurisdiction,  on or after the date on
         which a Transaction is entered into  (regardless of whether such action
         is taken or brought with respect to a party to this Agreement) or (y) a
         Change in Tax Law, the party  (which will be the Affected  Party) will,
         or  there  is a  substantial  likelihood  that  it  will,  on the  next
         succeeding  Scheduled  Payment Date (1) be required to pay to the other
         party an  additional  amount in respect of an  Indemnifiable  Tax under
         Section  2(d)(i)(4)  (except in respect of interest under Section 2(e),
         6(d)(ii)  or 6(e)) or (2)  receive  a payment  from  which an amount is
         required to be deducted or withheld  for or on account of a Tax (except
         in respect of interest  under  Section  2(e),  6(d)(ii) or 6(e)) and no
         additional  amount is  required to be paid in respect of such Tax under
         Section  2(d)(i)(4)  (other than by reason of Section  2(d)(i)(4)(A) or
         (B));

         (iii) Tax Event Upon Merger.  The party (the  "Burdened  Party") on The
         next succeeding  Scheduled  Payment Date will either (1) be required to
         pay an  additional  amount in  respect  of an  Indemnifiable  Tax under
         Section  2(d)(i)(4)  (except in respect of interest under Section 2(e),
         6(d)(ii)  or 6(e)) or (2)  receive a payment  from  which an amount has
         been deducted or withheld for or on account of any Indemnifiable Tax in
         respect of which the other party is not  required to pay an  additional
         amount  (other  than by reason of  Section  2(d)(i)(4)(A)  or (B)),  in
         either case as a result of a party  consolidating or amalgamating with,
         or merging with or into, or transferring all or  substantially  all its
         assets to, another entity (which will be the Affected Party) where such
         action does not constitute an event described in Section 5(a)(viii);

         (iv) Credit Event Upon Merger. If Credit Event Upon Merger is specified
         in the Schedule as applying to the party,  such party ("X"), any Credit
         Support  Provider  of  X  or  any  applicable  Specified  Entity  of  X
         consolidates or amalgamates  with, or merges with or into, or transfers
         all or substantially  all its assets to, another entity and such action
         does not  constitute an event  described in Section  5(a)(viii) but the
         creditworthiness  of the resulting,  surviving or transferee  entity is
         materially  weaker than that of X, such Credit Support Provider or such
         Specified Entity, as the case may be,  immediately prior to such action
         (and, in such event, X or its successor or transferee,  as appropriate,
         will be the Affected Party); or

         (v) Additional Termination Event. If any "Additional Termination Event'
         is  specified  in the Schedule or any  Confirmation  as  applying,  the
         occurrence  of such event (and,  in such event,  the Affected  Party or
         Affected Parties shall be as specified for such Additional  Termination
         Event in The Schedule or such Confirmation).

(c) Event of Default and  Illegality.  If an event or  circumstance  which would
otherwise  constitute  or give rise to an Event of Default also  constitutes  an
Illegality, it will be treated as an Illegality and will not constitute an Event
of Default.

 6.      Early Termination

(a) Right to Terminate  Following  Event of Default.  If at any time an Event of
Default  with  respect to a party (the  "Defaulting  Party") has occurred and is
then continuing,  the other party (the "Non-defaulting  Party") may, by not more
than 20 days notice to the  Defaulting  Party  specifying  the relevant Event of
Default, designate a day not earlier than the day such notice is effective as an
Early Termination Date in respect of all outstanding Transactions. If, borrower,
"Automatic  Early  Termination"  is  specified  in the Schedule as applying to a
party, then an Early Termination Date in respect of all outstanding Transactions
will occur  immediately  upon the  occurrence  with  respect to such party of an
Event of Default  specified in Section  5(a)(vii)(1),  (3),  (5), (6) or, to the
extent  analogous  thereto,  (8), and as of the time  immediately  preceding the
institution  of the  relevant  proceeding  or the  presentation  of the relevant
petition upon the  occurrence  with respect to such party of an Event of Default
specified in Section 5(a)(vii)(4) or, to the extent analogous thereto, (8).

(b) Right to Terminate Following Termination Event.

         (i) Notice.  If a  Termination  Event occurs,  an Affected  Party will,
         promptly upon becoming aware of it, notify the other party,  specifying
         the nature of that Termination Event and each Affected  Transaction and
         will also give such other  information  about that Termination Event as
         the other party may reasonably require.

         (ii)  Transfer to A void  Termination  Event.  If either an  Illegality
         under  Section  5(b)(i)(1)  or a Tax Event occurs and There is only one
         Affected  Party,  or if a Tax Event Upon Merger occurs and the Burdened
         Party is the Affected Party, the Affected Party will, as a condition to
         its  right  to  designate  an  Early  Termination  Date  under  Section
         6(b)(iv), use all reasonable efforts (which will not require such party
         to incur a loss, excluding immaterial, incidental expenses) to transfer
         within 20 days after it gives  notice  under  Section  6(b)(i)  all its
         rights and obligations  under this Agreement in respect of the Affected
         Transactions  to another  of its  Offices  or  Affiliates  so that such
         Termination Event ceases to exist.

If the Affected Party is not able to make such a transfer it will give notice to
the other party to that effect  within such 20 day period,  whereupon  the other
party may effect such a transfer  within 30 days after the notice is given under
Section 6(b)(i).

Any such transfer by a party under this Section  6(b)(ii) will be subject to and
conditional  upon the prior  written  consent of the other party,  which consent
will not be withheld if such other party's policies in effect at such time would
permit it to enter into transactions with the transferees on the terms proposed.

        (iii) Two Affected Parties. If an Illegality under Section 5(b)(i)(1) or
        a Tax Event occurs and there are two Affected  Parties,  each party will
        use all reasonable efforts to each agreement within 30 days after notice
        thereof  is  given  under  Section  6(b)(i)  on  action  to  avoid  that
        Termination Event.

(iv)    Right to Terminate.  If:-

          (1) a transfer  under Section  6(b)(ii) or an agreement  under Section
          6(b)(iii),  as the case may be, has not been  effected with respect to
          all Affected Transactions within 30 days after an Affected Party gives
          notice under Section 6(b)(i); or

          (2) an Illegality under Section 5(b)(i)(2), a Credit Event Upon Merger
          or an Additional  Termination Event occurs, or a Tax Event Upon Merger
          occurs and the Burdened Party is not the Affected Party,  either party
          in the case of an Illegality,  the Burdened Party in the case of a Tax
          Event Upon Merger, any Affected Party in the case of a Tax Event or an
          Additional Termination Event if there is more than one Affected Party,
          or the party which is not The  Affected  Party in the case of a Credit
          Event Upon Merger or an Additional  Termination Event if there is only
          one  Affected  Party may, by not more Than 20 days notice to the other
          party  and  provided  that  the  relevant  Termination  Event  is then
          continuing,  designate a day not  earlier  than the day such notice is
          effective  as an Early  Termination  Date in respect  of all  Affected
          Transactions.

(c)     Effect of Designation.

        (i) If  notice  designating  an Early  Termination  Date is given  under
        Section 6(a) or (b), the Early  Termination  Date will occur on the date
        so  designated,  whether  or  not  the  relevant  Event  of  Default  or
        Termination Event is then continuing.

        (ii)  Upon  the   occurrence  or  effective   designation  of  an  Early
        Termination  Date,  no further  payments  or  deliveries  under  Section
        2(a)(i)  or 2(e)  in  respect  of the  Terminated  Transactions  will be
        required to be made,  but without  prejudice to the other  provisions of
        this  Agreement.  The  amount,  if any,  payable  in respect of an Early
        Termination Date shall be determined pursuant to Section 6(e).

(d)     Calculations.

        (i)  Statement.  On or as soon as reasonably  practicable  following the
        occurrence  of an Early  Termination  Date,  each  party  will  make the
        calculations on its part, if any,  contemplated by Section 6(e) and will
        provide  to the other  party a  statement  (1)  showing,  in  reasonable
        detail,  such  calculations   (including  all  relevant  quotations  and
        specifying any amount payable under Section 6(e)) and (2) giving details
        of the relevant account to which any amount payable to it is to be paid.
        In the  absence of written  confirmation  from the source of a quotation
        obtained in  determining  a Market  Quotation,  the records of the party
        obtaining such  quotation  will be conclusive  evidence of the existence
        and accuracy of such quotation.

        (ii) Payment Date.  An amount  calculated as being due in respect of any
        Early  Termination  Date under  Section  6(e) will be payable on the day
        that notice of the amount  payable is effective (in the case of an Early
        Termination  Date which is  designated or occurs as a result of an Event
        of Default)  and on the day which is two Local  Business  Days after the
        day on which notice of the amount  payable is effective  (in the case of
        an  Early  Termination  Date  which  is  designated  as  a  result  of a
        Termination  Event).  Such  amount  will be paid  together  with (to the
        extent  permitted under applicable law) interest thereon (before as well
        as after judgment) in the Termination Currency, from (and including) the
        relevant Early  Termination Date to (but excluding) the date such amount
        is paid, at the Applicable Rate. Such interest will be calculated on the
        basis of daily compounding and the actual number of days elapsed.

(e) Payments on Early  Termination.  If an Early  Termination  Date occurs,  the
following  provisions shall apply based on the parties' election in the Schedule
of a payment measure, either "Market Quotation" or "Loss", and a payment method,
either the  "First  Method"  or the  "Second  Method".  If the  parties  fail to
designate a payment measure or payment method in the Schedule, it will be deemed
that "Market Quotation" or the "Second Method", as the case may be, shall apply.
The  amount,  if any,  payable  in  respect  of an  Early  Termination  Date and
determined pursuant to this Section will be subject to any Set-off.

          (i) Events of Default.  If the Early  Termination Date results from an
          Event of Default:-

           (1) First Method and Market  Quotation if the First Method and Market
           Quotation apply the Defaulting  Party will pay to the  Non-defaulting
           Party  the  excess,  if a  positive  number,  of (A)  the  sum of the
           Settlement Amount (determined by the Non-defaulting Party) in respect
           of  the  Terminated   Transactions   and  the  Termination   Currency
           Equivalent of the Unpaid  Amounts owing to the  Non-Defaulting  Party
           over (B) the  Termination  Currency  Equivalent of the Unpaid Amounts
           owing to the Defaulting Party.

           (2) First Method and Loss.  If The First  Method and Loss apply,  the
           Defaulting Party will pay to The Non-defaulting  Party, if a positive
           number, the Non-defaulting Party's Loss in respect of this Agreement.

           (3)  Second  Method and Market  Quotation.  If the Second  Method and
           Market  Quotation  apply,  an amount will be payable equal to (A) The
           sum of the Settlement Amount (determined by the Non-defaulting Party)
           in  respect  of  the  Terminated  Transactions  and  the  Termination
           Currency Equivalent of the Unpaid Amounts owing to The Non-defaulting
           Party  less (B) the  Termination  Currency  Equivalent  of the Unpaid
           Amounts owing to the Defaulting  Party.  If that amount is a positive
           number, the Defaulting Party will pay it to the Non-defaulting Party;
           if it is a negative  number,  the  Non-defaulting  Party will pay the
           absolute value of that amount to the Defaulting Party.

          (4) Second Method and Loss.  If the Second  Method and Loss apply,  an
          amount will be payable  equal to the  Non-defaulting  Party's  Loss in
          respect of this Agreement.  If that amount is a positive  number,  the
          Defaulting Party will pay it to the  Non-defaulting  Party; if it is a
          negative number, the Non-defaulting  Party will pay the absolute value
          of that amount to the Defaulting Party.

(ii)  Termination   Events.  If  the  Early  Termination  Date  results  from  a
Termination Event:-

         (1) One  Affected  Party.  If there is one Affected  Party,  the amount
         payable will be determined in accordance  with Section  6(e)(i)(3),  if
         Market  Quotation  applies,  or Section  6(e)(i)(4),  if Loss  applies,
         except that, in either case,  references to the Defaulting Party and to
         the  Non-defaulting  Party  will  be  deemed  to be  references  to the
         Affected  Party  and  the  party  which  is  not  the  Affected  Party,
         respectively,  and, if Loss applies and fewer than all the Transactions
         are being  terminated,  Loss  shall be  calculated  in  respect  of all
         Terminated Transactions.

        (2)    Two Affected Parties.  If there are two Affected Parties:-

               (A) if Market  Quotation  applies,  each party will  determine  a
               Settlement Amount in respect of the Terminated Transactions,  and
               an amount will be payable equal to (I) the sum of (a) one-half of
               the difference  between the  Settlement  Amount of the party with
               the bigger  Settlement  Amount ("X") and the Settlement Amount of
               the party  with the  lower  Settlement  Amount  ("Y") and (b) the
               Termination  Currency Equivalent of the Unpaid Amounts owing to X
               less  (II) the  Termination  Currency  Equivalent  of the  Unpaid
               Amounts owing to Y; and

               (B)if Loss applies, each party will determine its Loss in respect
               of this  Agreement  (or, if fewer than all the  Transactions  are
               being terminated,  in respect of all Terminated Transactions) and
               an amount will be payable  equal to  one-half  of the  difference
               between  the Loss of the party with the higher Loss ("X") and the
               Loss of the party with the lower Loss ("Y").

If the amount  payable is a  positive  number,  Y will I pay it to X; if it is a
negative number, X will pay the absolute value of that amount to Y.

         (iii)  Adjustment  for  Bankruptcy.  In  circumstances  where  an Early
         Termination Date occurs because "Automatic Early  Termination"  applies
         in respect of a party,  the amount  determined  under this Section 6(e)
         will be subject to such adjustments as are appropriate and permitted by
         law to reflect  any  payments  or  deliveries  made by one party to the
         other under this  Agreement  (and  retained by such other party) during
         the period from the  relevant  Early  Termination  Date to the date for
         payment determined under Section 6(d)(ii).

         (iv)  Pre-Estimate.  The parties agree that if Market Quotation applies
         an  amount   recoverable  under  this  Section  6(e)  is  a  reasonable
         pre-estimate of loss and not a penalty.  Such amount is payable for the
         loss of bargain and the loss of  protection  against  future  risks and
         except as otherwise  provided in this  Agreement  neither party will be
         entitled to recover any  additional  damages as a  consequence  of such
         losses.

 7.      Transfer

Subject  to  Section  6(b)(ii),  neither  this  Agreement  nor any  interest  or
obligation  in or under this  Agreement  may be  transferred  (whether by way of
security or otherwise) by either party without the prior written  consent of the
other party, except that:-

(a)  a  party  may  make  such  a  transfer  of  this  Agreement  pursuant  to a
consolidation  or amalgamation  with, or merger with or into, or transfer of all
or substantially all its assets to, another entity (but without prejudice to any
other right or remedy under this Agreement); and

(b) a party may make such a transfer  of all or any part of its  interest in any
amount payable to it from a Defaulting Party under Section 6(e).

Any purported transfer that is not in compliance with this Section will be void.

8.       Contractual Currency

(a) Payment in the Contractual Currency.  Each payment under this Agreement will
be made in the relevant  currency  specified in this  Agreement for that payment
(the  "Contractual  Currency").  To the extent  permitted by applicable law, any
obligation to make payments  under this  Agreement in the  Contractual  Currency
will not be discharged or satisfied by any tender in any currency other than the
Contractual  Currency,  except to the extent such  tender  results in the actual
receipt by the party to which  payment is owed,  acting in, a reasonable  manner
and in good faith in converting  the currency so tendered  into the  Contractual
Currency,  of the full amount in the Contractual Currency of all amounts payable
in respect of this  Agreement.  If for any reason the amount in the  Contractual
Currency  so  received  falls  short of the amount in the  Contractual  Currency
payable in respect of this  Agreement,  the party  required  to make the payment
will, to the extent permitted by applicable law, immediately pay such additional
amount in the  Contractual  Currency as may be necessary to  compensate  for the
shortfall.  If for any reason the amount in the Contractual Currency so received
exceeds  the  amount in the  Contractual  Currency  payable  in  respect of this
Agreement,  the party  receiving the payment will refund  promptly the amount of
such excess.

(b)  Judgments.  To the extent  permitted by applicable  law, if any judgment or
order  expressed in a currency other than the  Contractual  Currency is rendered
(i) for the payment of any amount owing in respect of this  Agreement,  (ii) for
the payment of any amount  relating to any early  termination in respect of this
Agreement  or (iii) in respect of a judgment  or order of another  court for the
payment  of any  amount  described  in (i) or  (ii)  above,  the  party  seeking
recovery,  after recovery in full of the aggregate amount to which such party is
entitled  pursuant  to the  judgment  or  order,  will be  entitled  to  receive
immediately  from the other party the amount of any shortfall of The Contractual
Currency  received  by such  party as a  consequence  of sums paid in such other
currency  and  will  refund  promptly  to the  other  party  any  excess  of the
Contractual  Currency  received by such party as a  consequence  of sums paid in
such other  currency if such shortfall or such excess arises or results from any
variation  between  the rate of exchange  at which the  Contractual  Currency is
converted  into the  currency of the  judgment or order for the purposes of such
judgment or order and The rate of  exchange at which such party is able,  acting
in a reasonable  manner and in good faith in  converting  the currency  received
into the Contractual  Currency,  to purchase the  Contractual  Currency with the
amount of the currency of the judgment or order actually received by such party.
The term "rate of exchange" includes, without limitation, any premiums and costs
of exchange  payable in connection  with the purchase of or conversion  into the
Contractual Currency.

(c) Separate  Indemnities.  To the extent  permitted by  applicable  law,  these
indemnities  constitute  separate  and  independent  obligations  from the other
obligations in this  Agreement,  will be enforceable as separate and independent
causes of action, will apply notwithstanding any indulgence granted by the party
to which any payment is owed and will not be affected by judgment being obtained
or claim or proof  being  made for any other  sums  payable  in  respect of this
Agreement.

(d) Evidence of Loss.  For the purpose of this Section 8, it will be  sufficient
for a party to  demonstrate  that it would  have  suffered  a loss had an actual
exchange or purchase been made.

9.       Miscellaneous.

(a) Entire  Agreement.  This  Agreement  constitutes  The entire  agreement  and
understanding  of the parties with respect to its subject  matter and supersedes
all oral communication and prior writings with respect thereto.

(b)  Amendments.  No  amendment,  modification  or  waiver  in  respect  of this
Agreement will be effective unless in writing  (including a writing evidenced by
a facsimile transmission) and executed by each of the parties or confirmed by an
exchange of telexes or electronic messages on an electronic messaging system.

(c)  Survival  of  Obligations.  Without  prejudice  to Sections  2(a)(iii)  and
6(c)(ii),  the  obligations of the parties under This Agreement will survive the
termination of any Transaction.

(d)  Remedies  Cumulative.  Except as  provided in this  Agreement,  the rights,
powers,  remedies and  privileges  provided in this Agreement are cumulative and
not exclusive of any rights, powers, remedies and privileges provided by law.

(e) Counterparts and Confirmations.

         (i) This  Agreement  (and Each  amendment,  modification  and waiver in
         respect of it) may be executed and delivered in counterparts (including
         by facsimile transmission), each of which will be deemed an original.

         (ii) The parties  intend  that they are  legally  bound by the terms of
         each  Transaction  from the moment they agree to those  terms  (whether
         orally or otherwise).  A Confirmation  shall be entered into as soon as
         practicable   and  may  be  executed  and  delivered  in   counterparts
         (including by facsimile  transmission)  or be created by an exchange of
         telexes or by an  exchange  of  electronic  messages  on an  electronic
         messaging  system,  which  in  each  case  will be  sufficient  for all
         purposes  to  evidence  a binding  supplement  to this  Agreement.  The
         parties will specify  therein or through  another  effective means that
         any  such  counterpart,  telex  or  electronic  message  constitutes  a
         Confirmation.

(f) No Waiver of Rights.  A failure or delay in exercising  any right,  power or
privilege  in respect of this  Agreement  will not be  presumed  to operate as a
waiver,  and a single or partial exercise of any right,  power or privilege will
not be presumed to preclude any subsequent or further  exercise,  of that right,
power or privilege or, the exercise of any other right, power or privilege.

(g)  Headings.  The  headings  used in this  Agreement  are for  convenience  of
reference  only and are not to affect  the  construction  of or to be taken into
consideration in interpreting this Agreement.

10.      Offices; Multibranch Parties

(a) If Section  10(a) is specified in the Schedule as applying,  each party that
enters into a  Transaction  through an Office other than its head or home office
represents to the other party that,  notwithstanding the place of booking office
or jurisdiction of  incorporation or organization of such party, the obligations
of such party are the same as if it had entered into the Transaction through its
head or home office.  This  representation will be deemed to be repeated by such
party on each date on which a Transaction is entered into.

(b)  Neither  party may change the Office  through  which it makes and  receives
payments  or  deliveries  for the  purpose of a  Transaction  without  the prior
written consent of the other party.

(c) If a party  is  specified  as a  Multibranch  Party  in the  Schedule,  such
Multibranch  Party  may  make and  receive  payments  or  deliveries  under  any
Transaction  through any Office listed in the Schedule,  and the Office  through
which it makes and receives payments or deliveries with respect to a Transaction
will be specified in the relevant Confirmation.

11.     Expenses

A Defaulting Party will, on demand,  indemnify and hold harmless the other party
for and against all reasonable out-of-pocket expenses,  including legal fees and
Stamp  Tax,  incurred  by such  other  party by  reason of the  enforcement  and
protection of its rights under this Agreement or any Credit Support  Document to
which the Defaulting  Party is a party or by reason of the early  termination of
any Transaction, including, but not limited to, costs of collection.

12.      Notices

(a)  Effectiveness.  Any  notice  or  other  communication  in  respect  of this
Agreement  may be given in any manner set forth below  (except  that a notice or
other  communication  under  Section  5 or 6  may  not  be  given  by  facsimile
transmission  or  electronic  messaging  system) to the  address or number or in
accordance  with the  electronic  messaging  system  details  provided  (see the
Schedule) and will be deemed effective as indicated:-

       (i) if in writing and  delivered in person or by courier,  on the date it
       is delivered;

      (ii) if  sent by  telex,  on the  date  the  recipient's  answer  back is
       received;

      (iii) if sent by facsimile  transmission (on the date that transmission is
      received by a  responsible  employee of the  recipient in legible form (it
      being agreed that the burden of proving  receipt will be on the sender and
      will  not  be met  by a  transmission  report  generated  by the  sender's
      facsimile machine);

      (iv) if sent by certified or registered mail (airmail, if overseas) or the
      equivalent (return receipt requested),  on the date that mail is delivered
      or its delivery is attempted; or

      (v) if sent by electronic  messaging  system, on the date that electronic
       message is  received,  unless  the date of that  delivery  (or  attempted
       delivery) or that receipt, as applicable,  is not a Local Business Day or
       that   communication   is  delivered  (or  attempted)  or  received,   as
       applicable, after the close of business on a Local Business Day, in which
       case that communication  shall be deemed given and effective on the first
       following day that is a Local Business Day.

(b)  Change of  Addresses.  Either  party may by notice to the other  change the
address,  telex or facsimile  number or electronic  messaging  system details at
which notices or other communications are to be given to it.

13.      Governing Law and Jurisdiction

(a)  Governing  Law.  This  Agreement  will  be  governed  by and  construed  in
accordance with the law specified in the Schedule.

(b) Jurisdiction.  With respect to any suit,  action or proceedings  relating to
this Agreement ("Proceedings"), each party irrevocably:-

         (i)  submits  to  the  jurisdiction  of the  English  courts,  if  this
         Agreement  is  expressed  to be  governed  by  English  law,  or to the
         non-exclusive  jurisdiction  of the courts of the State of New York and
         the United States District Court located in the Borough of Manhattan in
         New York City,  if this  Agreement  is  expressed to be governed by the
         laws of the State of New York; and

         (ii) waives any  objection  which it may have at any time to the laying
         of venue of any Proceedings brought in any such court, waives any claim
         that such  Proceedings  have been brought in an inconvenient  forum and
         further waives the right to object,  with respect to such  Proceedings,
         that such court does not have any jurisdiction over such party.

Nothing in this Agreement  precludes  either party from bringing  Proceedings in
any other jurisdiction  (outside,  if this Agreement is expressed to be governed
by English law, the Contracting  States, as defined in Section 1(3) of The Civil
Jurisdiction  and  Judgments  Act  1982  or  any   modification,   extension  or
re-enactment  thereof  for the time  being in force)  nor will the  bringing  of
Proceedings  in  any  one  or  more  jurisdictions   preclude  the  bringing  of
Proceedings in any other jurisdiction.

(c) Service of Process.  Each party  irrevocably  appoints the Process Agent (if
any) specified  opposite its name in the Schedule to receive,  for it and on its
behalf,  service of process in any  Proceedings.  If for any reason any  party's
Process  Agent is unable to act as such,  such  party will  promptly  notify the
other party and within 30 days appoint a substitute  process agent acceptable to
the other party. The parties  irrevocably consent to service of process given in
the manner  provided for notices in Section 12.  Nothing in this  Agreement will
affect the right of either party to serve process in any other manner  permitted
by law.

(d) Waiver of Immunities.  Each party irrevocably  waives, to the fullest extent
permitted by applicable  law, with respect to itself and its revenues and assets
(irrespective  of their use or  intended  use,  all  immunity  on the grounds of
sovereignty or other similar  grounds from (i) suit,  (ii)  jurisdiction  of any
court, (iii) relief by way of injunction,  order for specific performance or for
recovery of property,  (iv)  attachment of its assets  (whether  before or after
judgment)  and (v) execution or  enforcement  of any judgment to which it or its
revenues or assets might  otherwise be entitled in any Proceedings in the courts
of  any  jurisdiction  and  irrevocably  agrees,  to  the  extent  permitted  by
applicable law, that it will not claim any such immunity in any Proceedings.

14.      Definitions

As used in this Agreement:-

"Additional Termination Event" has the meaning specified in Section 5(b).

"Affected Party" has the meaning specified in Section 5(b).

"Affected  Transactions"  means  (a)  with  respect  to  any  Termination  Event
consisting  of  an  Illegality,   Tax  Event  or  Tax  Event  Upon  Merger,  all
Transactions  affected by the occurrence of such Termination  Event and (b) with
respect to any other Termination Event, all Transactions.

"Affiliate"  means,  subject to the  Schedule,  in relation  to any person,  any
entity  controlled,  directly  or  indirectly,  by the  person,  any entity that
controls,  directly  or  indirectly,  the  person  or  any  entity  directly  or
indirectly under common control with the person. For this purpose,  "control" of
any entity or person  means  ownership  of a majority of the voting power of the
entity or person.

"Applicable Rate" means:-

(a) in respect of obligations  payable or deliverable  (or which would have been
but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate;

(b) in respect of an  obligation  to pay an amount under  Section 6(e) of either
party from and after the date  (determined in accordance with Section  6(d)(ii))
on which that amount is payable, the Default Rate;

(c) in respect of all other  obligations  payable or deliverable (or which would
have been but for Section 2(a)(iii)) by a Non-defaulting  Party, the Non-default
Rate; and

(d) in all other cases, the Termination Rate.

"Burdened Party" has the meaning specified in Section 5(b).

"Change in Tax Law" means the enactment, promulgation, execution or ratification
of, or any change in or amendment to, any law (or in the application or official
interpretation  of any  law)  that  occurs  on or after  the  date on which  the
relevant Transaction is entered into.

"consent"  includes  a  consent,  approval,  action,  authorization,  exemption,
notice, filing, registration or exchange control consent.

"Credit Event Upon Merger" has the meaning specified in Section 5(b).
"Credit Support Document" means any agreement or instrument that is specified as
such in this Agreement.

"Credit Support Provider" has the meaning specified in the Schedule.
"Default  Rate"  means a rate per  annum  equal to the  cost  (without  proof or
evidence of any actual  cost) to the relevant  payee (as  certified by it) if it
were to fund or of funding the relevant amount plus 1 % per annum.

"Defaulting Party" has the meaning specified in Section 6(a).

"Early  Termination  Date" means the date  determined in accordance with Section
6(a) or 6(b)(iv).

"Event of Default" has the meaning specified in Section 5(a) and, if applicable,
in the Schedule.

"Illegality" has the meaning specified in Section 5(b).

"Indemnifiable  Tax" means any Tax other than a Tax that would not be imposed in
respect of a payment under this Agreement but for a present or former connection
between the jurisdiction of the government or taxation  authority  imposing such
Tax and the  recipient  of such  payment or a person  related to such  recipient
(including,  without  limitation,  a connection  arising from such  recipient or
related person being or having been a citizen or resident of such  jurisdiction,
or being or having been organized,  present or engaged in a trade or business in
such  jurisdiction,  or having or having had a permanent  establishment or fixed
place of business in such  jurisdiction,  but  excluding  a  connection  arising
solely  from such  recipient  or  related  person  having  executed,  delivered,
performed  its  obligations  or  received a payment  under,  or  enforced,  this
Agreement or a Credit Support Document).

"law" includes any treaty, law, rule or regulation (as modified,  in the case of
tax matters, by the practice of any relevant governmental revenue authority) and

"lawful" and "unlawful" will be construed accordingly.

"Local Business Day" means,  subject to the Schedule,  a day on which commercial
banks are open for business  (including dealings in foreign exchange and foreign
currency  deposits) (a) in relation to any obligation under Section 2(a)(i),  in
the place(s) specified in the relevant Confirmation or, if not so specified,  as
otherwise agreed by the parties in writing or determined  pursuant to provisions
contained, or incorporated by reference,  in this Agreement,  (b) in relation to
any other  payment,  in the place where the relevant  account is located and, if
different,  in the principal  financial  centre, if any, of the currency of such
payment, (c) in relation to any notice or other communication,  including notice
contemplated  under Section  5(a)(i),  in the city  specified in the address for
notice  provided by the recipient and, in the case of a notice  contemplated  by
Section  2(b),  in the place where the relevant new account is to be located and
(d) in relation to Section 5(a)(v)(2), in the relevant locations for performance
with respect to such Specified Transaction.

"Loss"  means,  with  respect  to  this  Agreement  or  one or  more  Terminated
Transactions,  as the  case  may  be,  and a  party,  the  Termination  Currency
Equivalent of an amount that party reasonably determines in good faith to be its
total losses and costs (or gain, in which case  expressed as a negative  number)
in connection  with this  Agreement or that  Terminated  Transaction or group of
Terminated Transactions, as the case may be, including any loss of bargain, cost
of funding or, at the  election of such party but without  duplication,  loss or
cost  incurred  as a  result  of  its  terminating,  liquidating,  obtaining  or
reestablishing any hedge or related trading position (or any gain resulting from
any of them).  Loss  includes  losses  and costs (or  gains) in  respect  of any
payment or delivery  required to have been made (assuming  satisfaction  of each
applicable condition precedent) on or before the relevant Early Termination Date
and not made, except so as to avoid duplication, if Section 6(e)(i)(1) or (3) or
6(e)(ii)(2)(A)  applies.  Loss  does  not  include  a  party's  legal  fees  and
out-of-pocket  expenses referred to under Section 11. A party will determine its
Loss as of the relevant  Early  Termination  Date, or, if that is not reasonably
practicable,  as of the earliest date thereafter as is reasonably practicable. A
party  may (but need not)  determine  its Loss by  reference  to  quotations  of
relevant  rates or  prices  from one or more  leading  dealers  in the  relevant
markets.

"Market  Quotation" means,  with respect to one or more Terminated  Transactions
and a party  making  the  determination,  an amount  determined  on the basis of
quotations from. Reference Market-makers.  Each quotation will be for an amount,
if any, that would be paid to such party  (expressed as a negative number) or by
such party  (expressed as a positive  number) in  consideration  of an agreement
between such party  (taking into account any existing  Credit  Support  Document
with  respect  to the  obligations  of such  party)  and the  quoting  Reference
Market-maker to enter into a Transaction (the  "Replacement  Transaction")  that
would have the effect of  preserving  for such party the economic  equivalent of
any payment or delivery  (whether the  underlying  obligation  was.  absolute or
contingent and assuming the satisfaction of each applicable condition precedent)
by the parties under Section 2(a)(i) in respect of such  Terminated  Transaction
or group of Terminated  Transactions  that would,  but for the occurrence of the
relevant Early  Termination  Date,  have been required after that date. For this
purpose,  Unpaid  Amounts in respect of the  Terminated  Transaction or group of
Terminated Transactions are to be excluded but, without limitation,  any payment
or delivery that would, but for the relevant Early  Termination  Date, have been
required (assuming  satisfaction of each applicable  condition  precedent) after
that Early Termination Date is to be included. The Replacement Transaction would
be subject to such  documentation  as such party and the Reference  Market-maker
may, in ,good faith,  agree. The party making the  determination  (or its agent)
will request each Reference  Market-maker to provide its quotation to the extent
reasonably  practicable as of the same day and time (without regard to different
time zones) on or as soon as  reasonably  practicable  after the relevant  Early
Termination  Date.  The day and  time as of  which  those  quotations  are to be
obtained  will  be  selected  in  good  faith  by the  party  obliged  to make a
determination  under  Section  6(e),  and,  if each party is so  obliged,  after
consultation  with the other.  If more than three  quotations are provided,  the
Market  Quotation will be the arithmetic mean of the quotations,  without regard
to the quotations  having the highest and lowest  values.  If exactly three such
quotations are provided,  the Market  Quotation will be the quotation  remaining
after disregarding the highest and lowest quotations.  For this purpose, if more
than one quotation has the same highest value or lowest value,  then one of such
quotations shall be disregarded. If fewer than three quotations are provided, it
will be  deemed  that  the  Market  Quotation  in  respect  of  such  Terminated
Transaction or group of Terminated Transactions cannot be determined.


"Non-default  Rate" means a rate per annum equal to the cost  (without  proof or
evidence of any actual cost) to the Non-defaulting Party (as certified by it) if
it were to fund the relevant amount.

"Non-defaulting Party" has the meaning specified in Section 6(a).
"Office" means a branch or office of a party,  which may be such party's head or
home office.
"Potential Event of Default" means any event which, with the giving of notice or
the lapse of time or both, would constitute an Event of Default.

"Reference  Market-makers"  means four leading  dealers in the  relevant  market
selected  by the party  determining  a Market  Quotation  in good faith (a) from
among dealers of the highest credit standing which satisfy all the criteria that
such party  applies  generally  at t he time in deciding  whether to offer or to
make an extension of credit and (b) to the extent  practicable,  from among such
dealers having an office in the same city.

"Relevant Jurisdiction" means, with respect to a party, the jurisdictions (a) in
which the party is incorporated, organized, managed and controlled or considered
to have its  seat,  (b) where an Office  through  which the party is acting  for
purposes of this  Agreement  is located,  (c) in which the party  executes  this
Agreement and (d) in relation to any payment, from or through which such payment
is made.

"Scheduled  Payment  Date"  means a date on which a payment or delivery is to be
made under Section 2(a)(i) with respect to a Transaction.

"Set-off" means set-off, offset,  combination of accounts, right of retention or
withholding  or  similar  right or  requirement  to which the payer of an amount
under Section 6 is entitled or subject  (whether  arising under this  Agreement,
another contract,  applicable law or otherwise) that is exercised by, or imposed
on, such payer.

"Settlement  Amount"  means,  with respect to a party and any Early  Termination
Date, the sum of:-

(a) the  Termination  Currency  Equivalent  of the  Market  Quotations  (whether
positive or negative)  for each  Terminated  Transaction  or group of Terminated
Transactions for which a Market Quotation is determined; and

(b) such-party's Loss (whether positive or negative and without reference to any
Unpaid  Amounts)  for  Each  Terminated   Transaction  or  group  of  Terminated
Transactions  for which a Market Quotation cannot be determined or would not (in
the  reasonable  belief  of  the  party  making  the  determination)  produce  a
commercially reasonable result.

"Specified Entity" has the meaning specified in the Schedule.

"Specified Indebtedness" means, subject to the Schedule, any obligation (whether
present or future, contingent or otherwise, as principal or surety or otherwise)
in respect of borrowed money.

"Specified  Transaction"  means,  subject to the Schedule,  (a) any  transaction
(including an agreement with respect thereto) now existing or hereafter  entered
into between one party to this Agreement (or any Credit Support Provider of such
party or any applicable  Specified  Entity of such party) and the other party to
this  Agreement  (or any Credit  Support  Provider  of such  other  party or any
applicable  Specified  Entity  of  such  other  party)  which  is  a  rate  swap
transaction,  basis swap,  forward rate transaction,  commodity swap,  commodity
option, equity or equity index swap, equity or equity index option, bond option,
interest rate option,  foreign  exchange  transaction,  cap  transaction,  floor
transaction, collar transaction, currency swap transaction,  cross-currency rate
swap transaction,  currency option or any other similar  transaction  (including
any option with respect to any of these  transactions),  (b) any  combination of
these  Transactions  and (c) any other  transaction  identified  as a  Specified
Transaction in this Agreement or the relevant confirmation.

"Stamp Tax" means any stamp, registration, documentation or similar tax.

"Tax" means any present or future tax, levy, impost, duty, charge, assessment or
fee of any nature (including interest,  penalties and additions thereto) that is
imposed by any  government  or other taxing  authority in respect of any payment
under this Agreement other than a stamp, registration,  documentation or similar
tax.

"Tax Event" has the meaning specified in Section 5(b).

"Tax Event Upon Merger" has the meaning specified in Section 5(b).

"Terminated  Transactions"  means with respect to any Early Termination Date (a)
if resulting  from a Termination  Event,  all Affected  Transactions  and (b) if
resulting from an Event of Default,  all Transactions (in either case) in effect
immediately  before  the  effectiveness  of the  notice  designating  that early
Termination  Date (or, if "Automatic  Early  Termination"  applies,  immediately
before that Early Termination Date).

"Termination Currency" has the meaning specified in the Schedule.

"Termination Currency Equivalent" means, in respect of any amount denominated in
the Termination  Currency,  such Termination  Currency amount and, in respect of
any amount  denominated in a currency other than the  Termination  Currency (the
"Other  Currency"),  the amount in the  Termination  Currency  determined by the
party  making the  relevant  determination  as being  required to purchase  such
amount of such Other Currency as at the relevant Early  Termination Date, or, if
the relevant Market  Quotation or Loss (as the case may be), is determined as of
a later date, that later date,  with the Termination  Currency at the rate equal
to the spot exchange rate of the foreign  exchange  agent  (selected as provided
below) for the purchase of such Other Currency with the Termination  Currency at
or about  11:00  a.m.  (in the  city in which  such  foreign  exchange  agent is
located) on such date as would be customary for the determination of such a rate
for the  purchase  of such  Other  Currency  for  value  on the  relevant  Early
Termination  Date or that later date.  The foreign  exchange agent will, if only
one party is obliged to make a determination  under Section 6(e), be selected in
good faith by that party and otherwise will be agreed by the parties.

"Termination Event" means an Illegality,  a Tax Event or a Tax Event Upon Merger
or, if specified to be  applicable,  a Credit Event Upon Merger or an Additional
Termination Event.

"Termination  Rate" means a rate per annum equal to the  arithmetic  mean of the
cost (without  proof or evidence of any actual cost) to each party (as certified
by such party) if it were to fund or of funding such amounts.

"Unpaid Amounts" owing to any party means,  with respect to an Early Termination
Date,  the  aggregate  of (a) in respect  of all  Terminated  Transactions,  the
amounts that became  payable (or that would have become  payable but for Section
2(a)(iii))  to such  party  under  Section  2(a)(i)  on or prior  to such  Early
Termination  Date and which remain unpaid as at such Early  Termination Date and
(b) in respect of each Terminated Transaction, for each obligation under Section
2(a)(i) which was (or would have been but for Section 2(a)(iii))  required to be
settled by delivery to such party on or prior to such Early Termination Date and
which has not been so settled as at such Early Termination Date, an amount equal
to the fair market  value of that which was (or would have been)  required to be
delivered  as of the  originally  scheduled  date  for  delivery,  in Each  case
together with (to the extent  permitted under  applicable law) interest,  in the
currency  of such  amounts,  from  (and  including)  the date  such  amounts  or
obligations  were or would have been  required to have been paid or performed to
(but  excluding)  such Early  Termination  Date, at the  Applicable  Rate.  Such
amounts of interest will be calculated on the basis of daily compounding and the
actual number of days elapsed.  The fair market value of any obligation referred
to in clause (b) above shall be  reasonably  determined  by the party obliged to
make the  determination  under Section 6(e) or, if Each party is so obliged,  it
shall be the average of The Termination  Currency Equivalents of the fair market
values reasonably determined by both parties.

IN WITNESS  WHEREOF the parties have executed  this  document on the  respective
dates  specified  below with effect from the date specified on the first page of
this document.

  BankBoston, N.A.                         American Skiing Company
  ................................         .....................................
   (Name of Party)                               (Name of Party)


      /s/ Robert G. Scott                  /s/ Thomas M. Richardson
  By: ..........................          By: ..................................
      Name:  Robert G. Scott                   Name:  Thomas Richardson
      Title:    Managing Director              Title: Chief Financial Officer
      Date:                                    Date:   August 1, 1998

Approval (for BankBoston, N.A. intemal purposes only):



(Multicurrency - Cross Border)


                                    SCHEDULE

                                     to the

                              ISDA Master Agreement

                             dated as of May 12,1998

                                     between

                                BANKBOSTON, N.A.
                                   ("Party A")

                                       and

                             AMERICAN SKIING COMPANY
                                   ("Party B")



                        Part 1. Termination Provisions.


(a)     "Specified Entity" means in relation to Party A for the purpose of:

Section 5(a)(v):  Not Applicable
Section 5(a)(vi): Not Applicable
Section 5(a) (vii): Not Applicable
Section 5(b)(iv): Not Applicable


and in relation to Party B for the purpose of:


Section 5(a)(v):  All Affiliates
Section 5(a)(vi): All Affiliates
Section 5(a) (vii):  All Affiliates
Section 5(b)(iv): All Affiliates


(b) "Specified Transaction" will have the meaning specified in Section 14.

(c) The "Cross Default" provisions of Section 5(a)(vi) will not apply to Party A
and will apply to Party B, subject to the following  proviso  being  inserted at
the end thereof:

";provided,  however,  that  notwithstanding the foregoing,  an Event of Default
shall not occur  under  either (1) or (2) above,  if (a) the event or  condition
referred to in (1) or the failure to pay  referred to in (2) is a failure to pay
caused by an error or omission of an administrative or operational  nature,  (b)
funds were  available  to such party to enable it to make the  relevant  payment
when due, and (c) such relevant payment is made within three Local Business Days
following  receipt of written notice from an interested party of such failure to
pay".

If such provisions apply:

"Specified Indebtedness" will have the meaning specified in Section 14.
"Threshold Amount" shall mean, with respect to Party B, USD 100,000.
(d) The "Credit Event Upon Merger"  provisions of Section 5(b)(iv) will apply to
Party A and will apply to Party B.

The "Automatic Early  Termination"  provisions of Section 6(a) will not apply to
Party A and will not apply to Party B, provided,  however,  that where the Event
of Default  specified in Sections 5  (a)(vii)(1),  (3), (4), (5), (6) or, to the
extent  analogous  thereto,  (8) is  governed  by a system of law which does not
permit  termination  to take place after the occurrence of the relevant Event of
Default,  the Automatic Early Termination  provisions of Section 6(a) will apply
to the relevant  party.  If Automatic  Early  Termination  of the Agreement does
occur as a result of this provision,  the Defaulting Party shall fully indemnify
the  Non-Defaulting  Party on  demand  against  all  expense,  loss,  damage  or
liability  that the  Non-Defaulting  Party may incur in respect of the Agreement
and each  transaction  as a  consequence  of movements  in  interest,  currency,
exchange or other  relevant  rates or prices  between the  Business Day on which
such  Automatic  Early  Termination  occurs  and the  Business  Day on which the
Non-Defaulting  Party first becomes aware that the Agreement has been terminated
pursuant  to this  provision.  The  Non-Defaulting  Party  may for this  purpose
convert any such expense, loss, damage or hability to the Termination Currency.

       Payments on Early  Termination.  For the purpose of Section  6(e) of this
Agreement:

(i)               Market Quotation will apply.
(ii)              The Second Method will apply.

(g)      "Termination Currency" means U.S. dollars.
(h)      Additional Termination Event will not apply.

Part 2.  Tax Representations.

(a) Payer Representations.  For the purpose of Section 3(e), Party A and Party B
will make the following representation:

It is not  required by any  applicable  law, as modified by the  practice of any
relevant governmental revenue authority of any Relevant jurisdiction to make any
deduction or  withholding  for or on account of any tax from any payment  (other
than interest  under Sections  2(e),  6(d)(ii) or 6(e) of this  Agreement) to be
made  by  it  to  the  other  party  under  this   Agreement.   In  making  this
representation, it may rely on:-

       (i) the accuracy of any  representation  made by the other party pursuant
       to Section 3(f);

       (ii) the  satisfaction  of the agreement of the other party  contained in
       Section  4(a)(i) or 4(a)(iii) and the accuracy and  effectiveness  of any
       document  provided  by the other  party  pursuant  to Section  4(a)(i) or
       4(a)(iii); and

       (iii) the  satisfaction  of the agreement of the other party contained in
       Section   4(d)   provided   that  it  shall  not  be  a  breach  of  this
       representation  where  reliance  is placed  on clause  (ii) and the other
       party does not  deliver a form or document  under  Section 4 (a) (iii) by
       reason of material prejudice to its legal or commercial position.

(b) Payee  Representations.  For the purpose of Section 3(f) of this  Agreement,
Party A and Party B make the representations specified below, if any:

         (i)  Party A  represents  that  it is a  national  banking  association
         organized under the laws of the United States of America.

         (ii) Party B represents  that it is a corporation  organized  under the
         laws of the State of Maine.

Part 3. Agreement to Deliver Documents.

<TABLE>
<CAPTION>
For the  purposes of Section  4(a) of the  Agreement  the other  documents to be
delivered are:

<S>                           <C>                           <C>                          <C>
Party required to deliver     Form/Document/                Date by which to be          Covered by Section 3(d)
document                      Certificate                   delivered                    Representation
Party A, Party B and any      Evidence of the authority,    Upon execution of this                  Yes.
Credit Support Provider       incumbency and specimen       Agreement, any Credit
                              signature of each person      Support Document and, upon
                              executing this Agreement,     request, any Confirmation.
                              any Credit Support Document
                              and any Confirmation on its
                              behalf.

Party B and any Credit        A legal opinion in form and   Upon execution of this                   No.
Support Provider of Party B.  substance acceptable to       Agreement.
                              Party A.

Party A.                      A copy of BankBoston          Promptly upon request by                Yes.
                              Corporation's most recent     Party B.
                              annual report containing
                              consolidated year end
                              financial statements
                              certified by independent
                              public accountants.

Party B.                      A copy of Party B's most      Promptly upon request by                Yes.
                              recent annual report          Party A.
                              containing year end
                              financial statements
                              certified by independent
                              public accountants.

Party B.                      A copy of Party B's           Promptly upon request by                Yes.
                              quarterly financial           Party A.
                              statements.
</TABLE>

Part 4. Miscellaneous.

          (a) Address  for  Notices.  For the  purpose of Section  12(a) of this
Agreement:

I.      Address for notices to Party A:

           For Confirmations/Settlements/Collateral Transfers/Resets:

(i)        acting through its Boston Head Office

Address:          BankBoston, N.A. 100 Federal Street Boston, MA 02110
Attn:             Senior Manager, Derivatives Operations, 01-13-08
Tel No:        (617) 434-7221
Fax No:        (617) 434-4284

For all notices or communications  given in respect of Section 5, 6, 7, 11 or 13
of this Agreement:

Address:          BankBoston, N.A. 100 Federal Street Boston, MA 02110
Attn:             Managing Director, Derivatives, 01-13-08
Tel No:           (617) 434-7529
Fax No:           (617) 434-1149 or 639-9342

with a copy to:

BankBoston, N.A.
Attn: General Counsel
100 Federal Street, 01-25-01
Boston, MA 02110
Tel No: (617) 434-2870
Fax No: (617) 434-6525

II. Address for notices or communications to Party B:


Address:          American Skiing Company Sunday River Road P.O. Box 450
                  Bethel, Maine 04217
Attention:        Thomas M. Richardson, Sr.  VP
Tel No:        207-824-5160
Fax No:        207-824-5158

(b) Process Agent. For the purpose of Section 13(c) of this Agreement:

        Party A Appoints as its Process Agent:

BankBoston International 590 Madison Avenue, 22nd Floor New York, NY 10022

with a copy to:

BankBoston, N.A.
100 Federal Street, 01-25-01
Boston, MA 02110
Attn:      General Counsel

        Party B appoints as its Process Agent:.
        Not applicable.

(c) Offices.  The provisions of Section 10(a) will apply to this Agreement.  

(d) Multibranch Party. For the purpose of Section 10(c) of this Agreement: Party
A is not a Multibranch Party.

         Party B is not a Multibranch Party.

(e)  Calculation  Agent.  The  Calculation  Agent is Party A,  unless  otherwise
specified in a Confirmation in relation to the relevant Transaction.

(f) Credit Support  Document.  In relation to Party B, Credit  Support  Document
means the Credit Support Annex attached hereto.

(g) Credit Support  Provider.  Credit Support  Provider means (x) in relation to
Party A, not applicable, and (y) in relation to Party B.

(h)  Governing  Law.  This  Agreement  will  be  governed  by and  construed  in
accordance with the laws of the State of New York,  without  reference to choice
of law doctrine.

(i) Netting of Payments.  Subparagraph  (ii) of Section  2(c) of this  Agreement
will not apply to any Transactions under this Agreement.

(J)  "Affiliate"  will have the meaning  specified  in Section 14. Part 5. Other
Provisions. (a) Set-Off.

        Any amount (the "Early  Termination  Amount")  payable to one party (the
        Payee)  by  the  other  party  (the  Payer)  under   Section   6(e),  in
        circumstances where there is a Defaulting Party or one Affected Party in
        the case where a Termination  Event under Section 5(b)(iv) has occurred,
        will, at the option of the party ("X") other than the  Defaulting  Party
        or the Affected Party (and without prior notice to the Defaulting  Party
        or the Affected Party),  be reduced by its set-off against any amount(s)
        (the "Other  Agreement  Amount") payable (whether at such time or in the
        future  or upon the  occurrence  of a  contingency)  by the Payee to the
        Payer (irrespective of the currency,  place of payment or booking office
        of the obligation)  under any other  agreement(s)  between the Payee and
        the Payer or instrument(s) or  undertaking(s)  issued or executed by one
        party to,  or in favor of,  the  other  party  (and the Other  Agreement
        Amount will be discharged  promptly and in all respects to the extent it
        is so  set-off X will give  notice  to the  other  party of any  set-off
        effected under this Section 5(a).

For this purpose,  either the Early  Termination  Amount or the Other  Agreement
Amount (or the relevant  portion of such amounts) may be converted by X into the
currency in which the other is denominated at the rate of exchange at which such
party  would be able,  acting  in a  reasonable  manner  and in good  faith,  to
purchase the relevant amount of such currency.

If an obligation is unascertained,  X may in good faith estimate that obligation
and set-off in respect of the estimate, subject to the relevant party accounting
to the other when the obligation is ascertained.

Nothing  in the  Section  5(a)  shall be  effective  to create a charge or other
security interest. This Section 5 (a) shall be without prejudice and in addition
to any right of set-off,  combination of accounts,  lien or other right to which
any  party is at any time  otherwise  entitled  (whether  by  operation  of law,
contract or otherwise).

 (b)    Definitions.

        (i) This Agreement,  each  Confirmation and each Transaction are subject
        to the 1991 ISDA  Definitions (as published by the  International  Swaps
        and Derivatives Association,  Inc.) as amended, supplemented or restated
        from  time to time  (the  "Definitions"),  and will be  governed  in all
        respects by the provisions set forth in the Definitions. The Definitions
        are  incorporated  by  reference  in, and shall be deemed to be part of,
        this  Agreement and each  Confirmation,  as if set forth in full in this
        Agreement   or  in  each  such   Confirmation.   In  the  event  of  any
        inconsistency   between  the   provisions  of  this  Agreement  and  the
        Definitions,   this  Agreement  will  prevail.   In  the  event  of  any
        inconsistency  between  the  provisions  of any  Confirmation  and  this
        Agreement,  such  Confirmation  will  prevail  for  the  purpose  of the
        relevant Transaction.

        (ii) With effect from and including  the date of this  Agreement (A) any
        reference to a "Swap  Transaction"  in the Definitions is deemed to be a
        reference  to a  "Transaction"  for the  purpose  of  interpreting  this
        Agreement or any  Confirmation  and (B) any reference to a "Transaction"
        in this Agreement or any  Confirmation  is deemed to be a reference to a
        "Swap Transaction" for the purpose of interpreting the Definitions.

(c)     Procedures for Entering into Confirmations.

        With respect to each Transaction  entered into pursuant hereto,  Party A
        shall,  on or  promptly  after the Trade  Date  thereof,  send Party B a
        Confirmation  confirming  such  Transaction,  and Party B shall promptly
        thereafter  confirm the accuracy of, or request the  correction of, such
        Confirmation.

Where a  Transaction  is  confirmed  by means of (i) an exchange  of  electronic
messages on an  electronic  messaging  system,  (ii) another form of document or
(iii) other confirming  evidence  exchanged between the parties  confirming such
Transaction,  such messages, document or evidence will constitute a Confirmation
for the purposes of this Agreement even where not so specified therein.

(d)      Additional Party B Event of Default.

         It shall  constitute an additional  Event of Default under Section 5(a)
of this Agreement in respect of which Party B shall be the Defaulting Party upon
the failure by Party B to observe,  perform and fulfill each and every covenant,
term and provision  applicable to it in that certain Amended and Restated Credit
Agreement,  dated as of November 12, 1997, as amended and/or  restated from time
to time, by and among the various  parties listed therein as Borrowers;  Party B
as Guarantor;  the Lenders party thereto;  Party A as Agent for the Lenders; and
DLJ Capital Funding,  Inc. as  Documentation  Agent for the Lenders (the "Credit
Agreement"),  provided  that in the event that the Credit  Agreement  terminates
prior to the performance in full by Party B of all of its duties and obligations
under  this  Agreement,  the  covenants,  terms  and  provisions  of the  Credit
Agreement  applicable  to Party B which  were in  effect  as of the date of such
termination,  other than those  requiring  payments  in respect of amounts  owed
under the Credit  Agreement,  shall remain in full force and effect for purposes
of this  Agreement  as though  until  such time as all of Party B's  duties  and
obligations under this Agreement are fully performed.

The aforementioned covenants,  terms, and provisions of the Credit Agreement are
hereby  incorporated  into this  Agreement  by  reference  as if fully set forth
herein.

(e)     Accuracy of Specified Information.

        Section 3(d) of this  Agreement is hereby amended by adding in the third
        line thereof,  after the word "respect" and before the period, the words
        "or, in the case of audited or unaudited financial statements or balance
        sheets, a fair  presentation of the financial  condition of the relevant
        person".

(f)      Additional Representations.

For  purposes  of  Section 3 of this  Agreement,  the  following  shall be added
immediately following paragraph (f) thereof:

         "(g) This Agreement and each Transaction constitutes a "swap agreement"
         within the meaning of Commodity  Futures  Trading  Commission  ("CFTC")
         Regulations Section 35.1(b)(1).

         (h) It is an  "eligible  swap  participant"  within the meaning of CFTC
         Regulations Section 35.1 (b) (2).

         (i) Neither this  Agreement  nor any  Transaction  is one of a fungible
         class of agreements that are standardized as to their material economic
         terms, within the meaning of CFTC Regulations Section 35.2(b).

         j) The  creditworthiness  of the other  party was or will be a material
         consideration  in  entering  into  or  determining  the  terms  of this
         Agreement  and each  Transaction,  including  pricing,  cost or  credit
         enhancement  terms of the Agreement or Transaction,  within the meaning
         of CFTC Regulations Section 35.2(c).

         (k) It has entered  into this  Agreement  (including  each  Transaction
         evidenced  hereby) in conjunction with its line of business  (including
         financial intermediation services) or the financing of its business.

         (l) It  engages,  will  engage  and holds  itself  out as  engaging  in
         "financial  contracts",  as defined  in  Regulation  EE of the  Federal
         Reserve  Board,  as a  counterparty  on  both  sides  of  one  or  more
         "financial  markets" (as defined in such regulation) and it fulfills at
         least one of the quantitative tests contained in such regulation.

         (m)  Relationship  Between  Parties.  Each  party  will  be  deemed  to
         represent  to the  other  party on the date on which it  enters  into a
         Transaction that (absent a written  agreement  between the parties that
         expressly  imposes  affirmative  obligations  to the  contrary  for the
         Transaction):

                  (i) Non-Reliance. It is acting for its own account, and it has
         made its own independent  decisions to enter into that  Transaction and
         as to whether that  Transaction  is  appropriate or proper for it based
         upon its own  judgment  and upon  advice  from such  advisors as it has
         deemed necessary.  It is not relying on any  communication  (written or
         oral) of the other party as investment advice or as a recommendation to
         enter into that  Transaction;  it being understood that information and
         explanations related to the terms and conditions of a Transaction shall
         not be considered  investment  advice or a recommendation to enter into
         that  Transaction.  It has  not  received  from  the  other  party  any
         assurance or guarantee as to the expected results of that Transaction.

                  (ii) Assessment and Understanding.  It is capable of assessing
         the  merits  of  and  understanding  (on  its  own  behalf  or  through
         independent  professional  advice),  and understands  and accepts,  the
         terms, conditions and risks of that Transaction.  It is also capable of
         assuming, and assumes, the risks of that Transaction.

                  (iii)  Status of  Parties.  The other party is not acting as a
         fiduciary for or as an advisor to it in respect of that Transaction.

(g)      Recording.

         Each party hereto consents to the monitoring or recording,  at any time
         and from time to time, by the other party of any and all communications
         between officers or employees of the parties, waives any further notice
         of such monitoring or recording,  and agrees to notify its officers and
         employees of such monitoring or recording.

(h)      Escrow.

         (i) If the  parties  are each  required  to make  payments  pursuant to
         Section  2(a) on the  same  day in  respect  of a  Transaction  but the
         payments  are to be  made  in  different  currencies,  the  party  that
         receives  the payment due to it first shall hold an amount equal to the
         payment it received in trust (with the right to  commingle  that amount
         with its  general  funds) for the benefit of the other party until that
         other party receives the corresponding payment due to it.

         If,  by  reason  of the time  difference  between  the  cities in which
payments are to be made, it is not possible for simultaneous payments to be made
on any date on which both  parties  are  required  to make  payments  hereunder,
either party may at its option and in its sole discretion notify the other party
that payments on that date are to be made in escrow. In this case deposit of the
payment  due  earlier on that day shall be made by 2:00 p.m.  (local time at the
place for the earlier payment) on that date with an escrow agent selected by the
party giving the notice,  accompanied by irrevocable payment instructions (i) to
release the  deposited  payment to the  intended  recipient  upon receipt by the
escrow agent of the required deposit of the corresponding payment from the other
party on the same date  accompanied by irrevocable  payment  instructions to the
same effect, or (ii) if the required deposit of the corresponding payment is not
made on that same date,  to return the payment  deposited by the party that paid
it into escrow.  The party that elects to have payments made in escrow shall pay
the costs of the escrow  arrangements  and shall  cause  those  arrangements  to
provide  that the intended  recipient  of the payment due to be deposited  first
shall be  entitled to  interest  on that  deposited  payment for each day in the
period of its deposit at the rate offered by the escrow agent.

(i)      Negative Interest Rates.

         (i) Floating  Amounts.  "Swap  Transaction"  means, for the purposes of
         this provision  concerning  Negative Interest Rates, a rate exchange or
         swap transaction, including transactions involving a single currency or
         two or more currencies. Party A and Party B agree that, if with respect
         to a Calculation Period for a Swap Transaction
         either party is  obligated to pay a Floating  Amount that is a negative
         number (either due to a quoted  negative  Floating Rate or by operation
         of a Spread that is subtracted  from the Floating  Rate),  the Floating
         Amount with respect to that party for that  Calculation  Period will be
         deemed  to be zero,  and the  other  party  will pay to that  party the
         absolute  value of the  negative  Floating  Amount  as  calculated,  in
         addition  to any  amounts  otherwise  owed by the other  party for that
         Calculation  Period  with  respect  to that  Swap  Transaction,  on the
         Payment  Date that the  Floating  Amount  would have been due if it had
         been a  positive  number.  Any  amounts  paid by the other  party  with
         respect to the  absolute  value of a negative  Floating  Amount will be
         paid to such account as the receiving party may designate  (unless such
         other party  gives  timely  notice of a  reasonable  objection  to such
         designation)  in the currency in which that Floating  Amount would have
         been paid if it had been a positive  number (and without  regard to the
         currency  in which  the  other  party is  otherwise  obligated  to make
         payments).

         (ii)  Compounding.  Party A and Party B agree that,  if with respect to
         one  or  more  Compounding   Periods  for  a  Swap  Transaction   where
         "Compounding" or "Flat Compounding" is specified to be applicable,  the
         Compounding  Period Amount,  the Basic Compounding Period Amount or the
         Additional  Compounding  Period Amount is a negative number (either due
         to a quoted negative  Floating Rate or by operation of a Spread that is
         subtracted  from the Floating  Rate),  then the Floating Amount for the
         Calculation   Period  in  which  that   Compounding   Period  or  those
         Compounding Periods occur will be either the sum of all the Compounding
         Period Amounts or the sum of all the Basic  Compounding  Period Amounts
         and all the Additional  Compounding  Period Amounts in that Calculation
         Period (whether  positive or negative).  If such sum is positive,  then
         the  Floating  Rate  Payer  with  respect  to the  Floating  Amount  so
         calculated  will pay that Floating  Amount to the other party.  If such
         sum is  negative,  the  Floating  Amount with respect to the party that
         would be  obligated  to pay that  Floating  Amount will be deemed to be
         zero,  and the other party will pay to that party the absolute value of
         the negative Floating Amount as calculated,  such payment to be made in
         accordance with (i) above.


Part 6. EMU; Continuity of Contract.

(a)      The parties  confirm that,  except as provided in subsection (b) below,
         the occurrence or  non-occurrence  of an event associated with economic
         and monetary  union in the European  Community will not have the effect
         of altering any term of, or discharging or excusing  performance under,
         this Agreement or any Transaction,  give a party the right unilaterally
         to alter or terminate this Agreement or any  Transaction  or, in and of
         itself,  give  rise  to an  Event  of  Default,  Termination  Event  or
         otherwise  be the  basis  for the  effective  designation  of an  Early
         Termination Date.

         "An event  associated  with economic and monetary union in the European
         community" includes, without limitation,  each (and any combination) of
         the following:

       (i) the  introduction  of,  changeover  to or  operation  of a single  or
       unified European currency (whether known as the euro or otherwise);

       (ii) the fixing of conversion rates between a member state's currency and
       the new currency or between the currencies of member states;

       (iii) the  substitution  of that new  currency for the ECU as the unit of
       account of the European Community;

       (iv) the introduction of that new currency as lawful currency in a member
       state;

       (v) the  withdrawal  from legal tender of any currency  that,  before the
       introduction of the new currency, as lawful currency in one of the member
       states; or

       (vi) the  disappearance or replacement of a relevant rate option or other
       price source for the ECU or the national currency of any member state, or
       the failure of the agreed sponsor (or a successor  sponsor) to publish or
       display a relevant rate, index, price, page or screen.

         (b) Any  agreement  between the parties  that amends or  overrides  the
         provisions  of this  Section  in  respect  of any  Transaction  will be
         effective if it is in writing and  expressly  refers to this Section or
         to European  monetary union or to an event associated with economic and
         monetary  union  in the  European  Community  and  would  otherwise  be
         effective in accordance with Section 9(b).

         IN WITNESS  WHEREOF,  the parties have executed this Schedule as of the
date specified on the first page hereof.

         BANKBOSTON, N.A.           AMERICAN SKIING COMPANY


         By: /s/ Robert G. Scott    By: /s/ Thomas M. Richardson
            --------------------        ------------------------
         Name:  Robert G. Scott             Name:  Thomas Richardson
         Title:    Managing Director        Title: Chief Financial Officer

         Approval (for BankBoston, N.A. internal purposes only):