SECOND AMENDMENT TO THE MASTER DISPOSITION AND DEVELOPMENT AGREEMENT


         This Second Amendment to Master  Disposition and Development  Agreement
("Second Amendment") is entered into as of this  5th day of  September 2000,  by
and among the  South  Tahoe  Redevelopment  Agency, a public body, corporate and
politic ("Agency"),  the  City of  South  Lake Tahoe,  a  municipal  corporation
("City")  and  American   Skiing  Company  Resort  Properties,  Inc.,  a   Maine
corporation  ("ASCRP"),  Heavenly  Resort  Properties,  LLC,  a  Nevada  limited
liability  company  ("Heavenly  Resort  Properties"),  Heavenly Valley,  Limited
Partnership,  a  Nevada  limited  partnership  ("Heavenly Valley"), Trans-Sierra
Investments,  a  Nevada  Corporation  ("TSI"),  and  Cecil's,  LLC,  a   limited
liability company ("Cecil's  Market"),  (collectively,  ASCRP,  Heavenly  Resort
Properties,  Heavenly  Valley,  TSI and Cecil's  Market,  Inc. shall be referred
to as the "Developers").  This Second  Amendment  amends that Master Disposition
and Development Agreement executed on October 28, 1999 as  amended  by the First
Amendment to the Master Disposition and Development  Agreement executed on April
18, 2000(the "Agreement").

                                    RECITALS

         A. The  Agency,  the City and the  Developers  entered  into the Master
Disposition and Development  Agreement on October 28, 1999,  which agreement was
amended by the First  Amendment to the  Disposition  and  Development  Agreement
dated  April  18,  2000.  The  Agreement  provides  for  the  development  of an
approximately  17 acre parcel located in the South Tahoe  Redevelopment  Project
No. 1 with a Gondola, Hotel Resort and retail uses.


         B. Due to delays in the  project , the time  periods  in the  Agreement
cannot be met.

         C. The Parties to the  Agreement  now desire to amend the  Agreement in
accordance  with the terms of this Second  Amendment in order to account for the
project delays.



         NOW,  THEREFORE,  in  consideration  of the  covenants  and  conditions
contained herein, the Agency and the Developers hereby agree as follows:

         1.    Letter of Credit. Section  2.01(b)(3)of the Agreement  is  hereby
amended in its entirety to read as follows:


               (3)    The existing letter of  credit  posted  by  ASCRP  must be
               extended or replaced with a new letter of credit which expires no
               earlier than March 25, 2003; provided, however, the amount of the
               letter of credit may be reduced in accordance with the provisions
               of this Section upon receipt of written notice from the Agency to
               the Developers that the conditions for reduction in the letter of
               credit  have  been  met.  This  Second  Amendment  shall  not  be
               effective until  Developers have delivered a new letter of credit
               or an extension  of the  existing  letter of credit to the Agency
               and the  Agency  has  deemed  the  terms of the  letter of credit
               satisfactory.

                      The Letter of Credit  shall  provide  that  the Agency can
               draw upon the letter of credit to pay costs  associated  with the
               Agency's  obligations  under this  Agreement  under the following
               conditions:

               (i)  If Heavenly Resort Properties has not commenced construction
               of the Grand  Summit Hotel and the Grand  Summit Annex by May 15,
               2001, the Agency  may draw down the full  amount of the letter of
               credit.  In order to draw  down  the full amount of the letter of
               credit, the  Agency shall  provide the  issuer of  the  letter of
               credit  written  notice  in  the  form  set forth in subsection 4
               below.



                                       1
<PAGE>

               (ii) If Heavenly Resort Properties does not complete construction
               of the Grand  Summit  Hotel on  or before  October 31, 2002,  the
               Agency can  draw down on the  letter of  credit to  pay any Delay
               Damages (as defined in Section 8.03 below)owed to the Agency that
               remain unpaid by March 17, 2003, by  providing  the issuer of the
               letter   of  credit  written  notice  in  the  form  set forth in
               subsection 4 below.

               (iii) If Heavenly  Resort  Properties has not paid the Agency the
               sum of Five Hundred Thousand Dollars ($500,000)owed to the Agency
               pursuant to Section 10.19 below on or before March 17, 2003,  the
               Agency can draw down $500,000 on March 17, 2003 by providing  the
               issuer  of the  letter  of credit  written notice in the form set
               forth in subsection 4 below.



                     In  the  event   Heavenly   Resort   Properties   commences
               construction of the Grand Summit Hotel on or before May 15, 2001,
               the  letter of credit  shall be  reduced  by the  amount of Three
               Million Five Hundred Thousand Dollars ($3,500,000).  In the event
               Heavenly Resort  Properties  completes  construction of the Grand
               Summit Hotel and the Grand Summit Annex on or before  October 31,
               2002, the letter of credit shall be further reduced by the amount
               of Seven Hundred Thousand  Dollars  ($700,000) upon completion of
               construction.  In the event Heavenly  Resort  Properties does not
               complete  construction  of the Grand  Summit  Hotel and the Grand
               Summit Annex by October 31, 2002, but does complete  construction
               of the Grand Summit Hotel and the Grand Summit Annex on or before
               November 30,  2002,  the letter of credit shall be reduced by the
               amount of Five Hundred Fifty  Thousand  Dollars  ($550,000)  upon
               completion  of   construction.   In  the  event  Heavenly  Resort
               Properties  does not  complete  construction  of the Grand Summit
               Hotel by October 31, 2002, but does complete  construction of the
               Grand Summit Hotel on or before  December 31, 2002, the letter of
               credit  shall  be  reduced  by  Four  Hundred   Thousand  Dollars
               ($400,000) upon completion of construction. In the event Heavenly
               Resort  Properties  does not complete  construction  of the Grand
               Summit Hotel and the Grand Summit Annex by October 31, 2002,  but
               does  complete  construction  of the Grand  Summit  Hotel and the
               Grand Summit Annex on or before  January 31, 2003,  the letter of
               credit  shall be reduced by the  amount of Two  Hundred  Thousand
               Dollars ($200,000) upon completion of construction.

                     The letter of credit shall be reduced by  $300,000  at such
               time as  Performance  and  Payment  Bonds are posted for the full
               amount of the construction contract for Phase 2.

               (4)   Draw on Letter of Credit.  The Agency shall be entitled  to
               draw on the  letter  of  credit by  providing  the  issuer of the
               letter of credit with a written  notice  containing the following
               language:


                     We  hereby certify  that  the Agency is entitled to draw on
               the letter of credit pursuant  to  the  terms  of  that   certain
               Disposition and  Development  Agreement dated October 28, 1999 as
               amended by the First  Amendment  to the DDA dated  April 18, 2000
               and as further  amended by the Second  Amendment to the DDA dated
               September 5, 2000.


         2.    Phase 2 Acquisitions. Section 3.01(e) of the Agreement is amended
in its entirety to read as follows:


                                       2
<PAGE>


               (e)   Phase   2   Acquisitions.   The  Agency  shall  not   begin
acquisition  of the  Phase 2  Development  Site  until  such  time as ASCRP  has
provided the Agency with a notice in writing of its intent to construct Phase 2;
provided  however,  the Agency may proceed with the  acquisition of the property
occupied by the Red Carpet Inn.  ASCRP must give a notice of intent to construct
Phase 2 no later than September 1, 2001; provided,  however, if ASCRP desires to
begin  construction of Phase 2 during the year 2001 building season,  ASCRP must
give the Agency a notice of intent to build  Phase 2 no later than  November  8,
2000. If ASCRP gives the Agency a notice of intent to build Phase 2 on or before
November 8, 2000 the Agency's obligation to commence  acquisition of the Phase 2
Development  Site shall be contingent on ASCRP  presenting  and  implementing  a
financial plan satisfactory to the Agency that provides the Agency with a source
of Three  Million One Hundred  Fifty  Thousand  Dollars  ($3,150,000 ) ("Phase 2
Loan")  available  by  November  8,  2000,  to be  used  for  acquisition  costs
associated  with the Phase 2 Development  Site and repayment of the Phase 2 Loan
on terms acceptable to the Agency, in its sole discretion.


         If ASCRP  fails to give the  Agency a notice  of  intent to build on or
before  September 1, 2001, the Agency may terminate  this Agreement  pursuant to
Section  12.05 and exercise any remedies the agency may have pursuant to Article
12, unless on or before September 1, 2001, ASCRP delivers to the Agency a letter
of credit meeting all of the  requirements  set forth in Section  2.01(b)(1) and
(2) in the  amount of One  Million  Six  Hundred  Sixty-Three  Thousand  Dollars
($1,663,000).  The letter of credit may be drawn on by the Agency to cover costs
associated with Phase 2 Site  Acquisition at any time after the letter of credit
is posted and the Agency shall have no  obligation to repay any amounts drawn on
the Letter of Credit for these purposes.

         3.    Conditions   Precedent  to   Transfer  of  Phase  1  Property  to
Developers. The references to Heavenly Resort  Properties and Heavenly Valley in
Subsections 6.01(c), 6.01(h) and 6.01(i) are hereby deleted in their entirety.

         4.    Sale of Property. Section 7.01 of the Agreement is amended in its
entirety to read as follows:


         7.01  Sale of Property.  Prior to the execution of the Second Amendment
the Agency has  transferred  to Heavenly  Valley Lot 13 and the Gondola Right of
Way for  construction  of the Gondola.  In addition,  the Agency has granted the
Paul Kennedy  Steakhouse Site to Cecil's Market in exchange for Cecil's Market's
conveyance  of the Jovicich  Property to the Agency.  On or before  November 15,
2000  the  Agency  shall  sell  and  convey  Lots 5, 8,  and 9 (as  shown on the
Preliminary  Subdivision Map) to Heavenly Resort  Properties for construction of
the Grand Summit Hotel and the Grand Summit  Annex.  The Agency shall convey the
Gondola  Park and Lots 6 and 7 to TSI for  construction  of the Ice Rink and the
multi-plex cinema within thirty (30) days following the date that all conditions
set forth in 5.01 and 6.01 have been met or waived by TSI.  Within  thirty  (30)
days  following the date that all the  conditions set forth in Sections 5.02 and
6.02 have been met or waived,  the Agency shall sell and convey  Parcel No. 1 to
Cecil's  Market and  Parcel 4 to ASCRP.  The  conveyance  of Parcel 1 to Cecil's
Market shall include the rights, granted by ASCRP to Cecil's Market, Inc. to the
use of five parking spaces in the underground  parking garage  developed as part
of the Lake Tahoe Inn,  provided the parking garage is developed as contemplated
in the Site Plan and provided,  further,  Cecil's Market, Inc., reimburses ASCRP
for the full cost of  developing  the five parking  spaces.  To  accomplish  the
conveyance  of each  Phase  of the  Development  Site  from  the  Agency  to the
Developers,  the Parties  shall  establish an Escrow with the Escrow  Holder and
shall execute and deliver to the Escrow  Holder  written  instructions  that are
consistent with this Agreement.  Heavenly Resort Properties,  ASCRP and Heavenly
Valley,  and the Agency acknowledge that as of the date of the execution of this
Second  Amendment all  conditions  to the  conveyance of the Phase 1 Development
Site set forth in Sections 5.01 and 6.01 are hereby deemed satisfied or waived.


         5.    Consideration. Section 7.02 of the Agreement is hereby amended by
adding the following paragraphs at the end of Section 7.02.



                                       3
<PAGE>

               As of the date of execution of this Agreement Heavenly Valley has
paid to the  Agency Five Hundred  Thousand Dollars  ($500,000) as  consideration
for the transfer of Parcel  13 and has paid an  additional  One  Hundred  Twenty
Eight Thousand Seven Hundred Dollars ($128,700)as consideration for the transfer
of the Gondola Right-of-Way.  Upon  conveyance  of the  remainder of the Phase 1
Site, Heavenly  Resort  Properties  shall  pay  to  the Agency the amount of One
Million Five  Hundred Thousand Dollars ($1,500,000) as the remaining amount owed
pursuant to this Section 7.02 as consideration for the conveyance of the Phase 1
Development Site. Regardless of any payments previously made by Heavenly Valley,
Heavenly  Valley  shall  continue to be obligated to pay to the Agency any costs
incurred  by  the  Agency   associated  with  the  acquisition  of  the  Gondola
Right-of-Way, including legal fees and any severance damages or special benefits
awarded any property  owners as a result of a partial  condemnation  of property
for the Gondola Right-of-Way.

               As additional consideration for the conveyance  of  the  Phase  1
Development  Site  to  the  Developers  and  as  security  for  the  Developer's
obligation  to commence  construction  of Phase 1 in a timely  manner,  Heavenly
Resort  Properties,  upon accepting transfer of the Lots 5, 8, and 9 shall fully
execute  and  deposit  with the Escrow  Holder a grant deed  reconveying  to the
Agency Parcels 5, 8, and 9 ("Heavenly Deed"). Heavenly Resort Properties and the
Agency shall also deposit with the Escrow Holder written  instructions  that the
Heavenly  Deed is to be  recorded  on July 1, 2001 if the  Agency  provides  the
Escrow Holder with a written notice stating that Heavenly Resort  Properties has
not commenced construction on the Grand Summit Hotel and the Grand Summit Annex;
provided,  however,  the date for  recordation  of the  Heavenly  Deed  shall be
subject to the provisions of Section 15.15. The instructions  shall also provide
that if Escrow  Holder does not receive any notice from the Agency by the end of
the day of July 1, 2001, or such date as applicable  pursuant to Section  15.15,
the Heavenly Deed is to be returned to Heavenly Resort Properties.

         6.    Transfer of Units of Use. The first  paragraph of Section 7.09 is
hereby amended to read as follows:


               Prior  to  Close of  Escrow on the Phase 1 development  site, the
Agency shall deposit into escrow a Bill of  Sale  transferring  to the  Heavenly
Resort Properties a maximum of 294 TAUs, 43,712 square feet of CFA and the Sewer
Units the Agency acquired when the Agency acquired the Phase 1 Development  Site
and the drainage  basin  area  located  at the corner of Pine Boulevard and Park
Avenue. Upon transfer of the Phase 2  Development  Site to the  Developers,  the
Agency shall also transfer to ASCRP a maximum of 456 TAUs, 8,154 square feet of
CFA and the Sewer Units the Agency acquired when the Agency acquired the Phase 2
Development  Site and the 15,990 CFA to Cecil's  Market,  Inc.  In the event the
Developers do not require the full number of TAUs set forth above to develop the
Project in accordance with approved plans and permits,  the number of TAUs to be
transferred  by the Agency  for Phase 1 shall be reduced to the number  actually
required  and any  unneeded  TAUs from Phase 1 shall be  retained by the Agency.
With  respect to each Phase,  the Agency  shall  transfer the Sewer Units to the
Developers at no cost to the Developers; provided, however, if the STPUD charges
any  fees  for  the  transfer  of the  Sewer  Units,  the  Developers  shall  be
responsible  for the payment of any such fees.  The Agency shall  cooperate with
the Developers in all efforts to minimize or eliminate any fees  associated with
the transfer of Sewer Units.


         7.    Conditions  to  Commencement of Construction. Section 8.01 as set
forth in the First Amendment is hereby amended to add the following subsections:

               (d)    Permits and Approvals.  Heavenly Resort  Properties  shall
have  obtained and  acknowledged  all permits and  approvals  necessary  for the
construction  of Phase 1 from any  federal,  state  and  local  agencies  having
jurisdiction  over the  construction  of the Project and shall be in  compliance
with all such permits.


                                       4
<PAGE>


               (e)    Water  Permits.  Heavenly  Resort  Properties  shall  have
applied for and obtained binding commitment from STPUD for adequate domestic and
fire sprinkler water supplies for the operation of Phase 1 of the Project.

               (f)    Waste Discharge  Permit.  Heavenly Resort Properties shall
have obtained waste discharge permits from Lahotan for Phase 1 of the Project.

         8.    Commencement of Construction.   Section 8.01 of the Agreement  as
renumbered  to Section 8.02 in the First  Amendment  to the  Agreement is hereby
amended in its entirety to read as follows:

         Heavenly  Resort  Properties  shall  commence or cause to be  commenced
construction  of Phase 1 of the Project on or before May 15, 2001.  Commencement
of construction means the Developers are fully mobilized on the Development Site
and have begun excavation of the Development  Site. In the event Heavenly Resort
Properties  does not  commence  construction  of the Grand  Summit Hotel and the
Grand Summit  Annex on or before May 15,  2001,  the Agency shall be entitled to
draw down the full amount of the letter of credit pursuant to Section 2.01(b) to
cover costs incurred by the Agency in complying with the DDA.


         9.    Completion of Construction.   Section 8.03 (formerly Section 8.02
prior  to  the  First Amendment)  is  hereby  amended in its entirety to read as
follows:

               Completion of  Construction.   The  Developers  shall  diligently
prosecute or cause to be prosecuted to completion the construction of each Phase
of the Project,  and shall complete or cause to be completed the construction of
each Phase of the Project no later than the time  specified  in the  Schedule of
Performance.  Completion of construction  shall mean the issuance of a Temporary
Certificate  of  Occupancy  from the City or the  issuance of a  Certificate  of
Completion  pursuant to Section 8.08. In the event  Heavenly  Resort  Properties
fails to complete  construction  of the Grand  Summit Hotel and the Grand Summit
Annex on or before October 31, 2002, Heavenly Resort Properties shall pay to the
Agency the sum of One Hundred Fifty Thousand  Dollars  ($150,000) for each month
that completion of construction is delayed through December 31, 2002.

         In the event Heavenly Resort Properties fails to complete  construction
by December 31, 2002,  Heavenly  Resort  Properties  shall pay to the Agency Two
Hundred Thousand Dollars  ($200,000) per month for each month that  construction
is  delayed  beyond  December  31,  2002,  continuing  until  a  Certificate  of
Completion  is issued.  The payments owed pursuant to this Section 8.03 shall be
prorated  appropriately  in the event the delay in completion of construction is
less than a full month.  The amounts to be paid  pursuant to this  Section  8.03
shall be referred to as "Delay Damages." In the event Heavenly Resort Properties
fails to pay to the Agency the "Delay  Damages"  owed  pursuant to this  Section
8.03 on or before March 17,  2003,  the Agency may draw the  appropriate  amount
owed from the letter of credit  pursuant to Section  2.01(b) to the extent there
are sufficient funds available under the letter of credit.  If the Delay Damages
exceed the letter of credit  amount,  the Agency  shall be  entitled to take any
action necessary to recover any shortfall in the amounts received.

         10.   Right  of  Entry  for Parking  Garage Site.   Section 8.17 of the
Agreement as renumbered to Section 8.18 in the First Amendment is hereby amended
to change the reference in the first sentence to the 2000 building season to the
2001 building season.

         11.   Mello-Roos District.  Section 9.05 (a) is amended in its entirety
to read as follows:

               (a) No later that March 1, 2002, Agency shall cause to be formed,
and the  Developers  will  facilitate the formation of,  a community  facilities
district  pursuant  to  the  Mello-Roos  Community  Facilities  Act  (California
Government  Code  Section  5334  and  following)  (the "Mello-Roos District") to
encompass the Phase 1 Property  which  will  levy a  Mello-Roos  Special  Tax in
accordance  with this Section 9.05.

               The  first  sentence  of  Section  9.05  (f)  is  amended  in its
entirety to read as follows:

               (f) The  Mello-Roos  Bonds shall be issued no later than April 1,
2002 provided the following conditions are met:


         12.   Reimbursement  for  Agency  Costs.  A new Section 10.19 is hereby
added to the Agreement to read as follows:


                                       5
<PAGE>


         Reimbursement  of Agency  Costs.  Heavenly  Resort  Properties  and the
         Agency recognize and acknowledge that delays in the construction of the
         Grand Summit Hotel and the Grand Summit Annex will delay the collection
         of tax increment  revenue and  transient  occupancy tax projected to be
         received by the Agency and to be used to pay interest on the BANS.  The
         result of this delay in the receipt of projected revenues to the Agency
         will cause the  Agency to have to fund  interest  payments  on the BANS
         from other revenue sources. Heavenly Resort Properties hereby agrees to
         pay to the Agency the sum of Five Hundred Thousand  Dollars  ($500,000)
         on or before  March 17 , 2003 in order to  compensate  the Agency for a
         portion of lost revenue  resulting in the delay of  construction of the
         Grand   Summit   Hotel  and  the   Grand   Summit   Annex.   ("Heavenly
         Reimbursement").  The  Heavenly  Reimbursement  is in addition to Delay
         Damages that may become due from Heavenly Resort Properties as a result
         of delays in the  completion of  construction  pursuant to Section 8.03
         above.  The Heavenly  Reimbursement  shall be repaid to Heavenly Resort
         Properties in accordance with the terms of Section 10.20 below.


         13.   Repayment of Reimbursements.  A new Section 10.20 is hereby added
to the Agreement to read as follows:


         10.20 Repayment of  Reimbursements.  For purposes of this Section 10.20
         the following terms shall have the following meanings:

               (a)"Excess Revenues" shall be as calculated pursuant to Exhibit M
attached hereto between fiscal years 2002-2003 through and including 2012-13.

               (b) "Prior Obligations" shall mean the following:

                      (1) The 1995 Series A and B and 1999 Series A Bonds;
                      (2) The 1999 Series A and B BANS or any refunding bonds or
                      debt  issuance  issued  by the  STJPFA
                      (3) Certificates   of   Participation   issues   for   the
                      construction   of  Fire  Station  No.  1;
                      (4) State Revolving Fund Loans for the Stateline   Erosion
                      Control Project and the  Ski  Run  Water  Quality Project.
                      (5) Any  annual  obligation  due  to  the   Developers for
                      reimbursement  of  expenses  related to the preparation of
                      the  EIR/EIS  in  accordance  with  Section  10.13  of the
                      Agreement.

         Beginning in Fiscal Year 2002-03 and  continuing  each year  thereafter
         through fiscal year 2012-13 the Agency and Heavenly  Resort  Properties
         or Heavenly Valley shall on an annual basis determine whether there are
         any Excess  Revenues by performing the calculation set forth in Exhibit
         M. Each year's  comparison  shall also cumulate the Excess Revenue from
         the  prior  years,  if  any  and  if  the  Excess  Revenue  calculation
         determines  that there is a deficit  in Excess  Revenue,  this  deficit
         shall be subtracted from any prior or future year Excess  Revenue.  The
         Agency shall provide Heavenly Resort  Properties with the determination
         of the amount of Excess Revenues, as well as the background information
         used to  determine  the  Excess  Revenue  on or before  April 1 of each
         Fiscal Year.


         Beginning in fiscal year  2004-2005 and  continuing in each fiscal year
until  fiscal year  2012-13 the Agency shall  distribute  the Excess  Revenue as
follows;  provided  however,  the  Agency's  obligation  to pay  Excess  Revenue
pursuant to this Section 10.20 shall be subordinate to the Prior Obligations and
the Agency shall first use the Excess  Revenue to pay the Prior  Obligations  to
the extent  the Agency  does not have  sufficient  other  funds to pay the Prior
Obligations.


                                       6
<PAGE>


                      (a) First,  to  the  City  in  the amount of Three Hundred
         Thousand  Dollars  ($300,000)  representing a portion of the amount the
         City  advanced to the Agency to cover lost revenue as a result of delay
         in the  construction  of the Grand  Summit  Hotel and the Grand  Summit
         Annex,  plus  interest on the  $300,000 at the rate of seven and thirty
         five one hundredths percent (7.35%) compounded annually and accruing as
         of March 20, 2003.

                      (b) Second, to the Agency and Heavenly  Resort  Properties
         in equal  amounts  until the  Agency  and  Heavenly  Resort  Properties
         have each  received  Five  Hundred  Thousand  Dollars  plus interest at
         the  rate  of  seven  and  thirty-five  one-Hundredths  percent (7.35%)
         compounded annually and accruing as of March 20, 2003.

                      (c)      Third, to the Agency.

         14.   Developer Performance.  Section 12.05 (a)(2) is hereby amended in
its entirety as follows:


              (2) Heavenly Resort Properties  fails  to deliver  performance and
payment bonds in the time period required pursuant to Section 8.01.

         15.  Exhibits.   Exhibit G,  the  Schedule  of  Performance,  is hereby
replaced in its entirety with the Schedule of  Performance  attached  hereto and
incorporated herein.

         16.  Cecil's  Market.  Cecil's  LLC  has  succeeded  to the interest of
Cecil's Market, Inc.,  to the Agreement as Amended.  The Agency hereby  approves
the transfer of Cecil's Market, Inc's.  interest  in the  Agreement  to  Cecil's
LLC and all references in the Agreement to Cecil's Market, Inc.shall hereinafter
refer to Cecil's LLC.


         17.  Effect of Amendment.  This Amendment  shall be effective as of the
effective date of the Agreement. Unless otherwise amended herein, all provisions
of the  Agreement  shall  continue  in full force and effect.  In the event of a
conflict between this First Amendmen  and the  Agreement,  this First  Amendment
shall control.  All  defined  terms not otherwise  defined herein shall have the
meaning given in the Agreement.


         AS OF  THE  DATE  FIRST  WRITTEN  ABOVE,  the  Parties  evidence  their
agreement to the terms of this Agreement by signing below:



                                       7
<PAGE>


Approved As To Form:                        AGENCY:

By: /s/Catherine L. DiCamillo               SOUTH TAHOE REDEVELOPMENT AGENCY,
    -------------------------               a public body, corporate and politic
       Agency Counsel
                                            By: /s/Hal Cole
                                                --------------------------------
                                            Its: Chair

                                            Dated: 9/13/00


Approved As To Form:                        CITY:

By: /s/Catherine L. DiCamillo               CITY OF SOUTH LAKE TAHOE,
    -------------------------               a municipal corporation
       City Attorney
                                            By: /s/Tom Davis
                                                --------------------------------
                                            Its: Mayor

                                            Dated: 9/13/00


                                            DEVELOPER:

                                            AMERICAN SKIING COMPANY RESORT
                                            PROPERTIES, a Maine corporation

                                            By: /s/Stan Hansen
                                                --------------------------------
                                            Its: Senior Vice President ASCRPI

                                            Dated: 9/12/2000


                                            HEAVENLY RESORT PROPERTIES, LLC,
                                            a Nevada limited liability company

                                            By: /s/Stan Hansen
                                                --------------------------------
                                            Its: Senior Vice President ASCRPI
                                                 Managing Member

                                            Dated: 9/12/2000


                                            HEAVENLY VALLEY,Limited Partnership,
                                            a Nevada limited partnership

                                            By: /s/Dennis J. Harmon
                                                --------------------------------
                                            Its: President

                                            Dated: 9/13/00


                                            TRANS-SIERRA INVESTMENTS,
                                            a Nevada corporation

                                            By: /s/Gary B. Casteel
                                                --------------------------------
                                            Its: President

                                            Dated: 9/12/00


                                            CECIL'S LLC, a California limited
                                            liability company

                                            By: /s/John Jovicich
                                                --------------------------------
                                                   John Jovicich
                                            Its: Managing Member

                                            Dated: 9/12/00