Document:

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: 9/12/001
        STATEMENT OF INTENTION AND SPECIAL ADDITIONAL FINANCING AGREEMENT

         THIS   STATEMENT  OF  INTENTION  AND   ADDITIONAL   SPECIAL   FINANCING
AGREEMENT(as  amended  from  time to time,  this  "Statement  of  Intention  and
Agreement"), dated July 25, 2000 between GRAND SUMMIT RESORT PROPERTIES, INC., a
Maine  corporation  (herein  referred  to  as  "GSRP"),  and  TEXTRON  FINANCIAL
CORPORATION, a Delaware corporation ("TFC").

         1.       STATEMENT OF INTENTIONS; BACKGROUND; AND APPLICABLE TERMS.

         GSRP and TFC mutually  acknowledge,  agree to, and state, the following
(all of which are hereby  incorporated into and made a part of this Statement of
Intention and Agreement):

                  (a)  Existing  LSA.  GSRP,   TFC,  as  a  lender  and  as  the
         administrative agent, Finova Capital Corporation,  Litchfield Financial
         Corporation and [Conseco Financial Services, f/k/a Green Tree Financial
         Servicing  Corporation]  are parties to that  certain Loan and Security
         Agreement,  dated as of September 1, 1998, as amended from time to time
         to (but not including) the date hereof (the "Existing LSA").

                  (b) Definitions. Capitalized terms used but not defined herein
         shall have the meanings ascribed thereto in the Existing LSA;

                  (c) 1997  Projects.  The Attitash  Loan, the Jordan Bowl Loan,
         the  Killington  Loan and the Mt. Snow Loan have each been paid in full
         and no further  Advances  are being made in respect of any of such 1997
         Projects. Release Prices, at reduced percentages (50% rather than 100%)
         of net proceeds from sales of Quartershare  Interests,  are still being
         collected from sales of Quartershare Interests at the 1997 Projects and
         being applied to the remaining  balance of the Loan. In connection with
         this  Statement  of Intention  and  Agreement,  it is GSRP=s  intent to
         increase the Release Prices in respect of the 1997 Projects from 50% of
         net proceeds to 65% of net proceeds and to also effect a similar change
         to the Release Prices  applicable to the Canyons  Project and Steamboat
         Projects  once  the  Canyons  Obligations  and  Steamboat  Obligations,
         respectively, are paid in full.

                  (d) Canyons  Project.  The Canyons  Project has  received  its
         final  Certificate  of  Occupancy,  and sales of  Canyons  Quartershare
         Interests are generating  Release Prices that are being applied to, and
         paying down, the Canyons Loan.

                                       1

<PAGE>

                  (e)  Steamboat  Project.  Due to  certain  cost  overruns  and
         delivery delays  identified  below,  upon full advance of the Steamboat
         Construction  Project  Advance  Commitments  there will be insufficient
         funds  available  under the  Existing  LSA to  complete  the  Steamboat
         Project.  The Steamboat  Project has not yet been fully  constructed in
         accordance  with the Plans for the  Steamboat  Project.  Disputes  have
         arisen around  modifications  that may have been effected to such Plans
         as well as change orders,  construction  change  directives,  delays in
         delivery and other modifications that may have been effected in respect
         of the Steamboat Construction  Contract.  GSRP has not consented to, or
         otherwise  approved,  any  modifications to the Plans or change orders,
         construction  change directives or other modifications to the Steamboat
         Construction  Contract that have not complied with the  requirements of
         the  Existing LSA and the Security  Documents in respect  thereof.  The
         Steamboat  General  Contractor  has asserted  that such change  orders,
         construction change directives and other modifications to the Steamboat
         Construction Contract (collectively,  the "Overrun Modifications") have
         been  properly  made and/or  incurred  and that costs,  both direct and
         indirect  as set  forth in  detail  on  Attachment  1  hereto,  arising
         therefrom  aggregate  $9,715,336  (the  "Overrun  Costs") and that such
         overrun costs are due and payable to the Steamboat General  Contractor.
         The Overrun Costs are in excess of the  "Guaranteed  Maximum  Price" of
         $70,000,000 in the Steamboat Construction Contract.

                  (f)  Steamboat  Project  Construction  Delays.  The  aforesaid
         Overrun  Modifications  have also, among other things,  resulted in the
         Steamboat General  Contractor not constructing the Steamboat Project so
         that it was substantially complete,  within the meaning of that term in
         the  Steamboat   Construction  Contract,  on  February  11,  2000.  The
         Steamboat General Contractor does not expect to substantially  complete
         the Steamboat Project and obtain a final certificate of occupancy until
         October 23, 2000, but expects to be able to deliver  Residential  Units
         with  conditional  certificates  of occupancy (with all such conditions
         being  acceptable  to  the  Special   Subordinated  Lender)  in  phases
         commencing  on September  4, 2000,  as more  particularly  set forth in
         clause (i) below.  The Existing LSA provides for a Completion  Date for
         the Steamboat Project of September 1, 2000.

                  (g) No further Steamboat  Construction  Project  Advances.  No
         Steamboat  Construction  Project  Advance  Lender is  prepared  to make
         additional  Steamboat  Construction  Project  Advances in excess of the
         Steamboat  Construction  Project  Borrowing  Base or  their  respective
         Steamboat  Construction  Project Advance  Commitment under the terms of
         the Existing LSA.

                  (h)  Defaults.  There is in  existence  no Default or Event of
         Default under the Existing LSA.

                                       2

<PAGE>

                  (i) Special  Financing  being  provided by this  Statement  of
         Intention and Agreement. TFC, in its individual capacity as a Steamboat
         Construction  Project  Advance Lender and not as  Administrative  Agent
         (TFC, as the advancing lender of the facility hereinafter  described in
         this paragraph 1(i) is referred to herein as the "Special  Subordinated
         Lender"),  is  prepared  to make,  subject to the terms and  conditions
         hereinafter  set  forth,  available  to GSRP in  conjunction  with  the
         Existing LSA a special  subordinated  loan  facility up to a maximum of
         principal amount of $10,000,000 (the  "Subordinated  Loan Tranche") for
         the sole  purpose of  financing  the  Construction  Costs  necessary to
         complete all  construction of the Steamboat  Project in accordance with
         the  supplemented  Plans for such Project (the  "Supplemented  Plans"),
         which shall  reflect the  originally  approved  Plans for the Steamboat
         Project and such modifications thereto as are described on Attachment 2
         hereto (the  "Steamboat  Plan  Modifications"),  and to provide certain
         nonconstruction cost financing for GSRP in respect of Sales,  Marketing
         &  Other  Costs,  FF&E  Costs  or  other  similar  out-of-pocket  costs
         ("Nonconstruction  Costs").  The completion of the  construction of the
         Steamboat  Project,  in accordance with the Supplemented  Plans,  shall
         proceed in accordance with the  construction  timeline and schedule set
         forth on Attachment 3 hereto (the "Construction  Completion Timeline"),
         which timeline  shall provide for distinct  stages of completion of the
         Steamboat  Project so that the  "lobby" and the  Steamboat  Residential
         Units  on  floors  1  through  4 of  the  Steamboat  Project  shall  be
         substantially  completed,  as  such  term  is  used  in  the  Steamboat
         Construction Contract, and shall have received conditional certificates
         of occupancy (with all such conditions  being acceptable to the Special
         Subordinated  Lender) no later than  September  4, 2000 and  additional
         Steamboat  Residential  Units being  completed  and  receiving  similar
         certificates  of occupancy  on the date or dates set forth  therefor in
         the Construction Completion Timeline.

                  (j)  Attachments.  The  Subordinated  Loan  Tranche  would  be
         evidenced  by an  amendment  attachment,  substantially  in the form of
         Attachment  4  hereto,  to be  executed  by GSRP  and  attached  to the
         Steamboat  Construction Project Note of TFC. Advances in respect of the
         Subordinated Loan Tranche  ("Subordinated Loan Tranche Advances") would
         be deemed by GSRP and TFC to be Steamboat Construction Project Advances
         under the  Existing  LSA and would be secured by all of the  Collateral
         (including, without limitation, the Steamboat Assignment of Architect=s
         Contract,   the  Steamboat  Assignment  of  Contracts,   the  Steamboat
         Assignment of Construction Contract, the Steamboat Assignment of Rents,
         the  Steamboat   Assignment  of  Declarant=s   Rights,   the  Steamboat
         Assignment of Property-Related  Contracts,  the Steamboat Assignment of
         Rents, and the Steamboat Blanket Mortgage), provided that:

                           (i) the  Subordinated  Loan  Tranche and all advances
                  made  thereunder by TFC, as the Special  Subordinated  Lender,
                  would  not  count  as,  or be  construed  as  being a part of,
                  Steamboat   Construction   Project  Advance  Commitments  (the
                  undertaking  of TFC, as the Special  Subordinated  Lender,  to
                  make   Subordinated   Loan  Tranche  Advances  to  GSRP  being
                  evidenced  solely by this Statement of Intention and Agreement
                  on the terms and conditions hereinafter set forth),

                           (ii)  the  Subordinated  Loan  Tranche  would  not be
                  counted as, or be a part of,  Steamboat Loan Exposure or other
                  Loan Exposure under the Existing LSA,

                                       3
<PAGE>

                           (iii) TFC, as the Special  Subordinated Lender, would
                  not be counted as, or be a part of, the Steamboat Construction
                  Project Required Lenders and would not otherwise be counted as
                  or vote as a Lender  under  the  Existing  LSA  solely  in its
                  capacity as the Special Subordinated Lender hereunder,

                           (iv)  Except  as set  forth  below  with  respect  to
                  certain "free and clear proceeds"  arising from the Collateral
                  referred to in Paragraph  2(b)(iii)(6) below, the Subordinated
                  Loan Tranche and all Collateral securing the same is and shall
                  be junior and  subordinate to (A) the payment of all Loans and
                  other  Obligations  under the  Existing  LSA and (B) the Liens
                  securing the same in the  Collateral;  it is the  intention of
                  GSRP and TFC, as the  Special  Subordinated  Lender,  that the
                  rights  of the  Lenders  under the  Existing  LSA shall not be
                  impaired  or  prejudiced  in any  way  by  this  Statement  of
                  Intention and Agreement and it is further the view of GSRP and
                  TFC, as the Special Subordinated Lender, that the availability
                  of  the   Subordinated   Loan  Tranche  is  essential  to  the
                  completion of the construction of the Steamboat  Project,  the
                  repayment of the Steamboat Loan and the continued  performance
                  by GSRP of all of its other undertakings and agreements in the
                  Existing LSA and,  accordingly,  directly benefits the Lenders
                  under the Existing LSA, and

                           (v) GSRP  will  collaterally  assign  to the  Special
                  Subordinated  Lender (pursuant to an assignment  substantially
                  in the form of  Attachment  5 hereto) all of its right,  title
                  and interest in and to the "free and clear  proceeds"  arising
                  from the Collateral described in Paragraph  2(b)(iii)(6) below
                  and GSRP shall authorizes the Administrative Agent to pay such
                  amounts directly to the Special  Subordinated  Lender.  In the
                  event that no Default  or Event of  Default  exists  under the
                  Existing LSA, no default or event of default exists hereunder,
                  no accrued interest  hereunder  remains unpaid, no installment
                  of Success  Fee  remains  unpaid and no  material  casualty or
                  condemnation  shall have  occurred,  the Special  Subordinated
                  Lender  shall  return  to GSRP  70% of such  "free  and  clear
                  proceeds;"  otherwise,  subject to Paragraph 2(b)(iii) hereof,
                  it shall retain all of such "free and clear proceeds."

                  (k)      Term Summary.  In consideration of TFC=s

                           (i) making the Subordinated Loan Tranche available to
                  the GSRP,

                                       4

<PAGE>

                           (ii) not requiring the  application  of the Steamboat
                  Construction   Project   Advances   Maturity   Date   to   the
                  Subordinated  Loan Tranche but rather  establishing a separate
                  maturity  date  with  respect  thereto  of August 1, 2003 (the
                  "Subordinated  Loan  Tranche  Maturity  Date");  it being  the
                  intention of the parties hereto that the outstanding principal
                  balance  of the  Subordinated  Loan  Tranche  shall be payable
                  (other  than on said  maturity  date or in the  instance of an
                  acceleration of the Subordinated Loan Tranche Obligations,  as
                  hereinafter  defined) only in  connection  with the receipt by
                  GSRP of  "free  and  clear"  cash  flow  referred  to below in
                  Paragraph 2(b)(iii)(6),

                           (iii) making such  Subordinated  Loan Tranche  junior
                  and  subordinate  to the  Loans  under the  existing  Loan and
                  Security Agreement, as provided in Paragraph 2(b)(i) hereof,

                           (iv)  not requiring the  application of  the  Default
                  Rate to the Subordinated Loan Tranche,

                           (v)   providing for the deferral of interest payments
                  and

                           (vi)  allowing  the   voluntary   prepayment  of  the
                  Subordinated Loan Tranche Advances, in whole (but not in part)
                  at any  time,  at the  sole  election  of  GSRP,  and  without
                  prepayment or premium of any kind other than the Final Payment
                  Fee  together  with  all  other   Subordinated   Loan  Tranche
                  Obligations  (upon the prepayment in full of the  Subordinated
                  Loan Tranche  Advances,  no further  Subordinated Loan Tranche
                  Advances shall be obtainable hereunder),

         GSRP agrees, as more particularly set forth below,

                           (A) to pay interest on the  principal  balance of the
                  Subordinated  Loan Tranche from time to time  outstanding at a
                  rate of interest of twenty  percent  (20%) per annum,  payable
                  monthly in arrears on the last day of such month (or,  if such
                  day  is  not  a  Business  Day,  on  the  first  Business  Day
                  thereafter),  provided  that  only 50% of the  amount  of such
                  interest  accrued  in  respect  of any month  shall be due and
                  payable in cash on the last day  thereof  and the other 50% of
                  such amount of such interest  shall, if no Default or Event of
                  Default  under the Existing LSA or default or event of default
                  hereunder shall exist,  automatically be deferred (without the
                  accrual  of any  further  interest  thereon)  until  the Final
                  Payment Date (as defined in subclause (B) immediately  below),
                  at which time such deferred  amount  (together  with all other
                  deferred  amounts of interest  hereunder) shall become due and
                  payable and,

                           (B)      to pay the Special Subordinated Lender

                                            (1) in  installments  as provided in
                                    Paragraph  2(b)(iii)(3)  hereof,  a  fee  of
                                    $1,000,000  or such lesser  amount as may be
                                    required  by  Paragraph   6(a)  hereof  (the
                                    "Syndication Fee") and

                                       5

<PAGE>

                                            (2) in one lump sum a final  payment
                                    fee  (the  "Final  Fee"),   which  shall  be
                                    payable on the  earlier of the  Subordinated
                                    Loan  Tranche  Maturity  Date or the date on
                                    which all principal of the Subordinated Loan
                                    Tranche is fully paid (such date is referred
                                    to  herein  as the  "Final  Payment  Date"),
                                    equal to the sum of the Final Fee  Component
                                    Amounts  for each of the  Subordinated  Loan
                                    Tranche   Advances,   where  a  "Final   Fee
                                    Component  Amount" for a  Subordinated  Loan
                                    Tranche  Advance shall equal the  difference
                                    between the original  outstanding  principal
                                    amount  of such  Subordinated  Loan  Tranche
                                    Advance  minus the  discounted  net  present
                                    value  of  each   payment  of  interest  and
                                    principal  in respect  of such  Subordinated
                                    Loan   Tranche    Advance    determined   in
                                    accordance with customary financial practice
                                    by using a discount  period of one month and
                                    a monthly  interest  rate equal to 2.083333%
                                    (or such  lesser  rate as may be required by
                                    Paragraph  6(a)  hereof) and by  discounting
                                    each such payment of principal  and interest
                                    from the date on which such payment was made
                                    to the  date  when  such  Subordinated  Loan
                                    Tranche  Advance was originally  extended by
                                    the   Special   Subordinated   Lender   (for
                                    purposes  of  determining   interest  to  be
                                    discounted  in respect  of any  Subordinated
                                    Loan  Tranche  Advance,  only  the  interest
                                    payments  accruing at 20% per annum  thereon
                                    shall be included  therein and such interest
                                    payments  shall be deemed  paid on the dates
                                    on which they are actually  paid in cash and
                                    any  of  such  interest  payments  that  are
                                    deferred,   in  accordance  with  the  terms
                                    hereof,  to the Final  Payment Date shall be
                                    deemed, for purposes of this  determination,
                                    to have  been  paid  in  cash on such  Final
                                    Payment Date);

                           (C) to pay to the  Special  Subordinated  Lender,  as
                  requested  by it  from  time to time  during  the  term of the
                  Subordinated  Loan  Tranche  after the  payment in full of the
                  Syndication Fee, its reasonable costs and fees, which

                                    (1)  in  the  aggregate   shall  not  exceed
                           $2,000,000  or such lesser  amount as may be required
                           by       Section        6(a)        hereof       (the
                           "Participation/Syndication Costs") and

                                    (2)  shall  have  been  incurred  or will be
                           incurred by TFC, in its capacity as a "Lender"  under
                           the  Existing  LSA  and as the  Special  Subordinated
                           Lender hereunder, in connection with obtaining one or
                           more  participants for the Subordinated  Loan Tranche
                           and/or TFC=s other Advances under the Existing LSA;

                                       6

<PAGE>

                  such Participation/Syndication Costs shall be incurred only if
                  determined  to be  necessary  by TFC in  the  exercise  of its
                  professional  judgment in order to attract participants in the
                  prevailing loan/participation market for commercial loans; the
                  funding of the payment of such Participation/Syndication Costs
                  will  be  limited  to 30% of the  "free  and  clear  proceeds"
                  arising   from  the   Collateral   referred  to  in  Paragraph
                  2(b)(iii)(4)  below; GSRP acknowledges that TFC is required by
                  its internal lending  constraints to reduce its aggregate loan
                  exposure   under  the  Existing  LSA  and  this  Statement  of
                  Intention  and  Agreement  to  $30,000,000  or less as soon as
                  possible  after November 30, 2000 and that the payment of such
                  Participation/Syndication  Costs is  essential  to  assist  in
                  achieving that reduction;

                  (l) The  Reserve.  The  Subordinated  Loan  Tranche  shall  be
         available,  subject to the satisfaction of the conditions  precedent to
         advancing  a  Steamboat  Construction  Project  Advance  and the  other
         conditions precedent set forth below in this Statement of Intention and
         Amendment, in multiple Subordinated Loan Tranche Advances. The proceeds
         of such  Advances  shall be used to pay for  Construction  Costs of the
         Steamboat  Project and as further  provided  in this  clause  (l);  any
         repayment of principal of any  Subordinated  Loan Tranche Advance shall
         not be available to be reborrowed  hereunder.  The Special Subordinated
         Lender may, in its sole discretion,  reserve $2,000,000 (the "Reserve")
         of the Subordinated Loan Tranche to fund potential  Construction  Costs
         of the Steamboat  Project and  Nonconstruction  Costs in respect of the
         Steamboat  Project or any other  Project of GSRP.  The Reserve shall be
         disbursed  solely  on the  conditions  precedent  set  forth  below  in
         Paragraph 3.

                  (m) Other  Lenders.  It is not the intention of either GSRP or
         TFC to effect,  pursuant to this  Statement of Intention and Agreement,
         any amendment or modification to the Existing LSA that is prohibited by
         its terms.  It is not the  intention of either GSRP or TFC to impair or
         adversely  affect in way any Loan or the Collateral  therefor under the
         Existing  LSA.  This  Statement  of  Intention  and  Agreement  and the
         Subordinated  Loan  Tranche  provided for herein is intended to enhance
         the  Collateral  for  such  Loans  and  contribute  to  the  successful
         repayment of such Loans by enabling  GSRP to complete  construction  of
         the  Steamboat  Project and commence the  consummation  of the sales of
         Steamboat Quartershare Interests. GSRP has notified each of the Lenders
         under the Existing LSA of its entering into this Statement of Intention
         and Agreement  with TFC and will seek their  approval to the amendments
         contemplated in Paragraph 5(f) below. The Special  Subordinated  Lender
         is entering  into this  Statement  of  Intention  and  Agreement in its
         individual capacity and not as the Administrative Agent.

                  (n)  Incorporation.  All  statements  in this  Paragraph 1 are
incorporated into and made a part hereof.

         2.  SUBORDINATED  LOAN TRANCHE AND TERMS OF  SUBORDINATED  LOAN TRANCHE
ADVANCES.

                                       7

<PAGE>

         Subject to the  satisfaction  of all  conditions  precedent  that would
otherwise be applicable to a Steamboat  Construction  Project  Advance under the
Existing LSA (except where such conditions would be directly  contradicted by an
express term of this  Statement of Intention and  Agreement,  in which case such
term shall control) and subject to the other  conditions  precedent set forth in
Paragraph 3 hereof, the Special  Subordinated Lender agrees to make Subordinated
Loan Tranche Advances to GSRP from the date hereof to and including December 31,
2000 in an aggregate  principal amount at any one time outstanding not to exceed
$10,000,000.  Each  Subordinated  Loan  Tranche  Advance  shall be a part of the
Subordinated  Loan Tranche and the Subordinated  Loan Tranche shall be deemed to
be a part of the credit extended to GSRP under the Steamboat Loan by the Special
Subordinated  Lender  (as  a  Steamboat  Construction  Project  Advance  Lender)
pursuant to the Existing  LSA, and GSRP shall execute and deliver to the Special
Subordinated  Lender  an  amendment  attachment  (substantially  in the  form of
Attachment 4 hereto) to its Steamboat Note (to be affixed thereto by the Special
Subordinated  Lender)  to  evidence  such  Subordinated  Loan  Tranche  and each
Subordinated Loan Tranche Advance to be made thereunder, provided that

                  (a)  Limitations of Subordinated  Loan Tranche  Advances -- no
         principal advanced by the Special Subordinated Lender in respect of the
         Subordinated Loan Tranche shall

                           (i)      qualify as Steamboat Loan Exposure,

                           (ii)     count  as  Steamboat  Construction   Project
                  Advance Commitments,

                           (iii) be included in any  determination as to whether
                  the  Steamboat  Loan  or the  Steamboat  Project  Construction
                  Advances  have,  in  the  aggregate,  exceeded  the  Steamboat
                  Construction Project Borrowing Base,

                           (iv) entitle the Special  Subordinated Lender to vote
                  any principal  amount or other amounts  outstanding in respect
                  of the  Subordinated  Loan  Tranche for any purpose  under the
                  Existing LSA (unless all of the Obligations under the Existing
                  LSA {without  including  therein any Subordinated Loan Tranche
                  Obligations} have been fully and finally paid),

                           (v) enable the Special  Subordinated Lender, as such,
                  to claim the  status as being  one of the  Steamboat  Required
                  Lenders,  one of the Required  Parties or the right to vote on
                  any  issue  requiring  unanimous  consent  of all  Lenders  or
                  Steamboat  Construction Project Lenders under the Existing LSA
                  (unless all of the Obligations under the Existing LSA {without
                  including therein any Subordinated  Loan Tranche  Obligations}
                  have fully and finally been paid),

                           (vi)  claim any fees or rights to be  reimbursed  for
                  any costs and expenses as a Steamboat Lender or a Lender under
                  the Existing LSA,

                                       8

<PAGE>

                           (vii)  enable the Special  Subordinated  Lender to be
                  able to claim a share of the  Collateral  or any  proceeds  in
                  respect  thereof  except as it otherwise  would be entitled to
                  claim  as a  Lender  or the  Administrative  Agent  under  the
                  Existing LSA or as set forth in Paragraph 2(b)(ii),  Paragraph
                  2(b)(iii)(6) or Paragraph 2(b)(iii)(8) below, or

                           (viii) cause the outstanding principal balance of the
                  Loans  (including  the  outstanding  principal  balance of the
                  Subordinated  Loan Tranche) to exceed the Maximum  Outstanding
                  Loan Limit (which is $105,000,000).

                  (b) Certain  Terms  Applicable  to  Subordinated  Loan Tranche
         Advances -- subject to the  limitations and  restrictions  set forth in
         subclause (a) above and in this subclause (b),

                           (i) the  principal,  interest,  fees  (including  the
                  Syndication Fee and the  Participation/Syndication  Costs) and
                  other  costs and  expenses  incurred  in  connection  with the
                  Subordinated  Loan Tranche  (collectively,  the  "Subordinated
                  Loan Tranche  Obligations")  are intended to be and qualify as
                  Steamboat Obligations,  to be secured by all of the Collateral
                  (including,  without limitation,  the Steamboat  Assignment of
                  Architect=s  Contract,  the Steamboat Assignment of Contracts,
                  the  Steamboat  Assignment  of  Construction   Contract,   the
                  Steamboat  Assignment of Rents,  the  Steamboat  Assignment of
                  Declarant=s    Rights,    the    Steamboat    Assignment    of
                  Property-Related Contracts, the Steamboat Assignment of Rents,
                  and the Steamboat  Blanket  Mortgage),  to be evidenced by the
                  Steamboat Note of the Special  Subordinated Lender pursuant to
                  an amendment attachment to be affixed thereto (as set forth in
                  Attachment  4 hereto)  and to be  junior  and  subordinate  in
                  payment   to  the   Obligations   (excluding   therefrom   any
                  Subordinated  Loan  Tranche  Obligations)  and in  Lien to the
                  Liens in and to the Collateral  securing such Obligations,  as
                  more particularly provided for in Attachment 6 hereto;

                           (ii) the Administrative  Agent shall act on behalf of
                  the  Special  Subordinated  Lender,  to the same  extent as it
                  would act under the Existing LSA as Administrative  Agent, for
                  purposes of securing, perfecting,  asserting, and/or enforcing
                  Liens  and  security  interests  in and to the  Collateral  as
                  security for the Subordinated Loan Tranche Obligations (except
                  that the Special  Subordinated  Lender  shall have no right to
                  instruct the  Administrative  Agent or to  participate  in any
                  instructions  being given to the  Administrative  Agent unless
                  and  until  all of the  Obligations  under  the  Existing  LSA
                  (without  including  therein  any  Subordinated  Loan  Tranche
                  Obligations)  have  fully  and  finally  been  paid;  for  the
                  avoidance of doubt and subject to the terms and  provisions of
                  Paragraph   2(b)(i)   hereof,   GSRP  hereby   grants  to  the
                  Administrative  Agent on  behalf of the  Special  Subordinated
                  Lender a security  interest and Lien in and to the  Collateral
                  to  secure  the  payment  and/or  performance  of  all  of the
                  Subordinated Loan Tranche Obligations;

                                       9
<PAGE>

                           (iii) the Subordinated Loan Tranche Obligations shall
                  be, and be deemed to be, part of the,  Steamboat  Obligations,
                  except that

                                    (1) the rate of interest  payable in respect
                           thereof,   the   amount  of  fees   payable   thereon
                           (including,  without limitation, the Syndication Fee,
                           the      Final      Payment      Fee      and     the
                           Participation/Syndication   Costs)   and  all   other
                           Subordinated   Loan  Tranche   Obligations  shall  be
                           payable  only to the Special  Subordinated  Lender in
                           accordance  with the terms hereof and out of Free and
                           Clear Proceeds,  from other funds of GSRP that do not
                           constitute  Collateral  or from funds of GSRP that do
                           constitute   Collateral   but   after   all   of  the
                           Obligations  under the  Existing  LSA (other than the
                           Subordinated  Loan  Tranche  Obligations)  have  been
                           fully and finally paid, as hereinafter provided for,

                                    (2) the  Subordinated  Loan Tranche Advances
                           and the Subordinated  Loan Tranche  Obligations shall
                           mature  on the  Subordinated  Loan  Tranche  Maturity
                           Date,  provided that, in any case,  the  Subordinated
                           Loan   Tranche   Obligations   shall  be  subject  to
                           acceleration  as set forth in the last  paragraph  of
                           Paragraph 2(b)(iii)(7) hereof,

                                    (3)  subject to  Paragraph  2(b)(i)  hereof,
                           (aa)  GSRP  shall  pay  to the  Special  Subordinated
                           Lender the Syndication Fee in installments, each such
                           installment  being payable  whenever after October 1,
                           2000 Free and Clear Proceeds are available, with each
                           such  installment  being in an amount equal to 30% of
                           the  amount of such Free and Clear  Proceeds;  if the
                           full  Syndication  Fee shall have not been paid on or
                           prior to December 31,  2000,  it shall become due and
                           payable in full on such date, and (bb) GSRP shall pay
                           to the  Special  Subordinated  Lender  on  the  Final
                           Payment Date the Final  Payment Fee, as determined in
                           respect  of such  Final  Payment  Date as  calculated
                           pursuant to Paragraph 1(k)(b) hereof,

                                    (4)   GSRP   shall   pay  to   the   Special
                           Subordinated  Lender  the   Participation/Syndication
                           Costs, in such amounts (up to an aggregate  amount of
                           $2,000,000 or such lesser amount as shall be required
                           by Paragraph  6(a) hereof) as may be requested by the
                           Special   Subordinated   Lender  from  time  to  time
                           hereunder  after the  Syndication Fee shall have been
                           paid in  full,  provided  that the  aggregate  of all
                           requests for such payment in any calendar month shall
                           not  exceed  30% of the  amount  of  Free  and  Clear
                           Proceeds  available  in  respect  of the  immediately
                           preceding month (less any  Syndication  Fees that may
                           have  been  paid  in  such  preceding   month);   the
                           incurrence of  Participation/Syndication  Costs shall
                           be as provided for in Paragraph 1(k)(C) hereof;

                                       10
<PAGE>

                                    (5) as additional consideration for the fees
                           and rate of  interest  set forth  above,  the Special
                           Subordinated  Lender  agrees that no Default  Rate of
                           interest shall be applicable to the Subordinated Loan
                           Tranche Obligations;

                                    (6) all  payments  in  respect  of the  Host
                           Company Lease  Agreements,  the sale of  Quartershare
                           Interests, the sale of Commercial Units and any other
                           payments   (either   as   Release   Price   payments,
                           application  of insurance or  condemnation  proceeds,
                           test  date  excess   payments  or  cure  payments  of
                           borrowing  base  deficiencies)  that are derived from
                           any of the  Projects and that are not required by the
                           terms of the  Existing  LSA to be  applied  to one or
                           more of the  Loans and which  GSRP,  pursuant  to the
                           terms of the Existing  LSA, is entitled to retain and
                           use  (collectively,  the "Free  and Clear  Proceeds")
                           shall be,  promptly upon the receipt  thereof by GSRP
                           (and GSRP hereby instructs the  Administrative  Agent
                           to pay all of such Free and Clear  Proceeds  directly
                           to the Special Subordinated Lender), delivered to the
                           Special  Subordinated  Lender for  application to the
                           Subordinated Loan Tranche Obligations as follows:

                                            first,   towards   the   costs   and
                                    expenses    incurred    by    the    Special
                                    Subordinated  Lender under this Statement of
                                    Intention and Agreement,  including, without
                                    limitation, any Loan Costs in respect of the
                                    Subordinated  Loan  Tranche  and  all  other
                                    fees,   costs  and  expenses  set  forth  in
                                    Paragraph 6(c) hereof;

                                            second,   towards  the  accrued  and
                                    unpaid  interest  on the  Subordinated  Loan
                                    Tranche  Advances  (other  than the  portion
                                    thereof that shall have been deferred to the
                                    Final Payment Date);

                                            third, towards the  then-outstanding
                                    principal  amount  of  the Subordinated Loan
                                    Tranche Advances, and

                                            fourth,  any other Subordinated Loan
                                    Tranche Obligations.

                                       11

<PAGE>

                           For the avoidance of doubt,  Free and Clear  Proceeds
                           shall include any and all proceeds  delivered to GSRP
                           from the Cash  Collateral  Account and shall  include
                           all  payments  in respect of the Host  Company  Lease
                           Agreements,  the sale of Quartershare Interests,  the
                           sale of Commercial  Units and any other payments that
                           are derived from any of the Projects on and after the
                           date  on  which  the  Obligations   (other  than  the
                           Subordinated Loan Tranche  Obligations) are fully and
                           finally  paid. To the extent that no Default or Event
                           of Default  exists under the Existing LSA, no default
                           or event of  default  exists  hereunder,  no  accrued
                           interest payable in cash then due and payable remains
                           unpaid,  no installment of the  Syndication  Fee then
                           due  and  payable  remains  unpaid  and  no  material
                           casualty  or  condemnation  in  respect  of a Project
                           shall  have  occurred,  the  portion  of any Free and
                           Clear   Proceeds  to  be  applied  as  set  forth  in
                           subclauses first through third above shall be limited
                           to 30% of the amount  thereof  and the amount of such
                           Free and Clear Proceeds to be applied as set forth in
                           subclause   fourth  above  shall  be  limited  to  an
                           additional  30% of such Free and Clear  Proceeds with
                           such additional 30% being applied first solely to the
                           payment  of  the   Syndication  Fee  as  provided  in
                           Paragraph  2(b)(iii)(3) hereof and second,  after the
                           Syndication  Fee is paid in full,  to the  payment of
                           Participant/Syndication    Costs   as   provided   in
                           Paragraph 2(b)(iii)(4) hereof, and any remaining Free
                           and Clear Proceeds shall be returned to GSRP free and
                           clear of any security interest or Lien of the Special
                           Subordinated  Lender  therein.   Notwithstanding  the
                           immediately    preceding   sentence,    the   Special
                           Subordinated  Lender shall retain and have a security
                           interest  and  Lien  in  and to all  Free  and  Clear
                           Proceeds  unless and until it has  returned a portion
                           thereof  to  GSRP as  provided  above  and  expressly
                           releases  its  security  interest and Lien therein in
                           connection with such return.

                                    (7) the following shall be additional Events
                           of Default  applicable to just the Subordinated  Loan
                           Tranche:

                                            (i) the Steamboat General Contractor
                                    refuses  to  confirm  that  the  "Guaranteed
                                    Maximum Price" under, and as defined in, the
                                    Steamboat  General  Contract  is  less  than
                                    $80,000,000,  excluding  amounts  in dispute
                                    between  GSRP  and  the  Steamboat   General
                                    Contractor   that  are  not  then  currently
                                    included in said "Guaranteed Maximum Price;"

                                       12

<PAGE>

                                            (ii) the "Guaranteed  Maximum Price"
                                    under,  and as  defined  in,  the  Steamboat
                                    General  Contract is  determined by a final,
                                    nonappealable   judgment  to  be  more  than
                                    $80,000,000  (inclusive  of any amounts that
                                    were  formerly in dispute  between  GSRP and
                                    the Steamboat General  Contractor under said
                                    Steamboat  General Contract) or GSRP and the
                                    Steamboat  General  Contractor  shall  enter
                                    into a definitive  settlement agreement that
                                    provides for said "Guaranteed Maximum Price"
                                    (inclusive of any amounts that were formerly
                                    in dispute  between  GSRP and the  Steamboat
                                    General   Contractor  under  said  Steamboat
                                    General    Contract)   to   be   more   than
                                    $80,000,000  and as to  which  GSRP  has not
                                    obtained  the prior  written  consent of the
                                    Special Subordinated Lender;

                                            (iii)    the    Steamboat    General
                                    Contractor  is not in  compliance  with  the
                                    Construction  Completion  Timeline  for  the
                                    phased completion of the Steamboat  Project;
                                    and

                                            (iv) any  Lender  (other  than  TFC,
                                    Litchfield  Financial   Corporation  or  any
                                    other  Lender   having   consented  to  this
                                    Statement of  Intention  and  Agreement,  in
                                    writing,  and their  successors and assigns)
                                    or Fleet Bank shall  object (in  writing) to
                                    this Statement of Intention and Agreement.

                           The Subordinated Loan Tranche Obligations may, at the
                           option  of  the  Special   Subordinated   Lender,  be
                           declared  immediately  due and payable by the Special
                           Subordinated  Lender,  with or without written notice
                           or demand to GSRP,  upon the  occurrence of any Event
                           of  Default  under  the  Existing  LSA  or any of the
                           above-listed  additional  Events of Default  and such
                           Subordinated Loan Tranche Obligations  (together with
                           the  Syndication  Fee, the Final  Payment Fee and all
                           deferred  and  unpaid  interest)  shall   immediately
                           become due and payable and, in connection  therewith,
                           all obligations of the Special Subordinated Lender to
                           make  Subordinated  Loan Tranche  Advances  hereunder
                           shall  terminate.  The  Final  Payment  Fee  shall be
                           determined   as  of  the   date   of  the   aforesaid
                           acceleration  as if  all  Subordinated  Loan  Tranche
                           Advances  had then been paid in full and, if said Fee
                           is not  paid on such  date,  it shall  bear  interest
                           hereunder  at a rate  per  annum of 20%  (subject  to
                           Paragraph 6(a) hereof).

                                       13
<PAGE>

                                    (8) upon the full and final repayment of all
                           Obligations (other than the Subordinated Loan Tranche
                           Obligations),  the Special  Subordinated Lender shall
                           have the full right to  instruct  the  Administrative
                           Agent to  foreclose  on all or any of the  Collateral
                           and to apply all proceeds from all  Collateral to the
                           Subordinated Loan Tranche Obligations as follows:

                                            first,   towards   the   costs   and
                                    expenses    incurred    by    the    Special
                                    Subordinated  Lender under this Statement of
                                    Intention and Agreement,  including, without
                                    limitation, any Loan Costs in respect of the
                                    Subordinated  Loan  Tranche  and  all  other
                                    fees,   costs  and  expenses  set  forth  in
                                    Paragraph 6(c) hereof;

                                            second,  towards  the  accrued   and
                                    unpaid  interest  on  the  Subordinated Loan
                                    Tranche Advances;

                                            third,  towards the then-outstanding
                                    principal  amount  of  the Subordinated Loan
                                    Tranche Advances,

                                            fourth,  to the payment of the Final
                                    Payment Fee and the Syndication Fee,

                                            sixth,   to  the   payment  of   the
                                    Participation/Syndication Costs, and

                                            seventh, to  any  other Subordinated
                                    Loan Tranche Obligations.

         3.       CONDITIONS TO MAKING OF SUBORDINATED LOAN TRANCHE ADVANCES.

         The  conditions  precedent set forth in Section 2.1(a) and Section 6 of
the Existing LSA, as such  conditions  apply to the making of Steamboat  Project
Construction  Advances,  shall apply to the making of Subordinated  Loan Tranche
Advances except to the extent that such conditions are inconsistent with any one
or more of the conditions set forth below,  and each of the conditions set forth
below  shall also be  applicable  to the  making of  Subordinated  Loan  Tranche
Advances:

                  (a) General  Contractor  Certificate -- the Steamboat  General
         Contractor  shall  have  delivered  a  special  construction   contract
         certificate  which shall be in form and substance  satisfactory  to the
         Special Subordinated Lender and which shall, among other things,

                           (i) confirm that the Steamboat General Contract is in
                  full force and effect and has not been suspended or terminated
                  by the Steamboat General Contractor,

                           (ii) have attached thereto all modifications,  change
                  orders and construction  change  directives  applicable to the
                  Steamboat General Contract and not previously delivered to the
                  Special Subordinated Lender,

                                       14
<PAGE>

                           (iii)  set  forth  a then  current  breakdown  of the
                  guaranteed maximum price under the Steamboat General Contract,
                  which  shall in no case  exceed  $80,000,000,  and the amounts
                  currently in dispute between the Steamboat General  Contractor
                  and GSRP,

                           (iv) set  forth and  confirm  the  Steamboat  General
                  Contractor=s  compliance with Construction Completion Timeline
                  and will confirm its ability to comply with a staged  delivery
                  of Steamboat Residential Units commencing on September 4, 2000
                  and ending on October 23, 2000,

                           (v)  which   acknowledges   the   Steamboat   General
                  Contractor=s   acceptance  of  a  "dual  check"   disbursement
                  procedure if required by the Special  Subordinated  Lender for
                  the then remaining unadvanced portion of the Subordinated Loan
                  Tranche and

                           (vi) otherwise  be  substantially  in  the  form   of
                  Attachment 7 hereto;

         Sections  2.1(a)(ii) and (iii) and 6.5(b) of the Existing LSA shall not
         be applicable to the making of Subordinated Loan Tranche Advances.  For
         the  avoidance of doubt,  the Special  Subordinated  Lender may require
         other  reasonable  conditions  precedent to be satisfied in  connection
         with any  advancement by way of a Subordinated  Loan Tranche Advance of
         the  Reserve  (including,  without  limitation,   additional  financial
         statements  and  projections;  Nonconstruction  Cost  invoices or bills
         together  with  evidences of the payment  thereof;  and proof that such
         advancements  are not being  used to  indirectly  satisfy  construction
         costs in respect of the Steamboat Project).

                  (b) Availability under Existing LSA -- no Special Loan Tranche
         Advance  shall be made if there is  availability  remaining  under  the
         Existing LSA to make Steamboat Construction Project Advances;

                  (c) Defaults -- no Special Loan Tranche  Advance shall be made
         if a Default or Event of Default  exists  under the  Existing  LSA or a
         default or event of default  exists  under this  Statement of Intention
         and Agreement;

                  (d) Joint Checks -- if  requested by the Special  Subordinated
         Lender,  GSRP shall  exercise  its right  under the  Steamboat  General
         Contract to require  disbursement  of the then  requested  Subordinated
         Loan Tranche  Advance by the so-called  "joint  check" method  (whereby
         checks are made payable to both the Steamboat  General  Contractor  and
         the particular  materialman,  supplier or subcontractor then being paid
         from the proceeds of such Subordinated Loan Tranche Advance); and

                  (e) Exceeding  $105MM  --  after  giving  effect  to any  then
         requested  Subordinated Loan Tranche Advance,  the aggregate  principal
         amount  outstanding  under the Loans and the Subordinated  Loan Tranche
         shall not exceed the Maximum Outstanding Loan Amount.

         4.       REPRESENTATIONS AND WARRANTIES.

         In order to induce the  Special  Subordinated  Lender to enter into and
perform under this Statement of Intention and Agreement,  GSRP hereby, as of the
date hereof, represents and warrants as follows:

                                       15
<PAGE>

                  (a) Warranties and Representations True and Correct. Except as
         otherwise disclosed on Attachment 8 hereto, each of the representations
         and  warranties  contained in Section 4 of the Existing LSA is true and
         correct as of the date hereof.

                  (b)  Transaction  Is Legal and  Authorized.  The execution and
         delivery of this  Statement of Intention  and  Agreement  and the other
         documents and instruments  contemplated  herein, and compliance by GSRP
         with all of the provisions of this Statement of Intention and Agreement
         and each of the other documents contemplated herein are:

                           (i)  within the corporate powers of GSRP;

                           (ii) valid and legal acts and will not conflict with,
                  or  result  in any  breach  in any of the  provisions  of,  or
                  constitute a default  under,  or result in the creation of any
                  Lien (except Liens  contemplated  hereunder) upon any Property
                  of GSRP  under  the  provisions  of,  any  agreement,  charter
                  instrument, bylaw or other instrument to which GSRP is a party
                  or by which its Property may be bound.

                  (c)  Governmental  Consent.  Neither the nature of GSRP, or of
         any of its businesses or Properties,  or any relationship  between GSRP
         and any  other  Person,  or any  circumstance  in  connection  with the
         execution or delivery of this  Statement of Intention and Agreement and
         the  other  documents  contemplated  in  connection  herewith,  nor the
         operation  of any Project and the sale,  or offering  for sale,  of any
         Quartershare  Interest of any of the  Projects  by GSRP,  is such as to
         require  a  consent,   approval   or   authorization   of,  or  filing,
         registration or qualification  with, any governmental  authority on the
         part of GSRP, as a condition of the execution,  delivery or performance
         of this Agreement and the other  documents  contemplated  in connection
         herewith.

                  (d)  Restrictions  of GSRP.  GSRP will not be, on or after the
         date hereof,  a party to any contract or agreement  which restricts its
         right  or  ability  to  incur  indebtedness  under,  or  prohibits  the
         execution  of, or  compliance  with,  this  Statement of Intention  and
         Agreement by GSRP.  GSRP has not agreed or consented to cause or permit
         in the future (upon the happening of a contingency or otherwise) any of
         its  Property  constituting  the  Collateral,   whether  now  owned  or
         hereafter  acquired,  to be subject to a Lien and all Liens in favor of
         the  Administrative  Agent in respect of such Collateral remain in full
         force and effect.

                  (e) Brokers' Fees.  There are no brokers and finders which are
         entitled to receive  compensation  for their services  rendered to GSRP
         with respect to the transactions described in this Agreement.

                                       16
<PAGE>

                  (f) No Defaults  or Events of Default.  No Default or Event of
         Default has occurred and is continuing, nor does any event or condition
         exist that would  constitute  a Default or an Event of Default upon the
         execution and delivery of this  Agreement.  No material  adverse change
         has occurred in or in respect of the  Collateral  or any one or more of
         the Projects,  except as disclosed herein with respect to the Steamboat
         Project.  GSRP has performed all of its obligations under the Steamboat
         Construction Contract.

         5.  CONDITIONS  PRECEDENT TO THIS  STATEMENT OF INTENTION AND AGREEMENT
BECOMING EFFECTIVE.

         This  Statement of Intention  and Agreement  shall become  effective on
July __,  2000 (the  "Closing  Date")  upon the parties  hereto  executing  this
Statement of Intention and  Agreement and upon each of the following  conditions
being satisfied:

                  (a) Secretary's Certificates.  The Special Subordinated Lender
         shall have  received a  certificate  of the  Secretary or any Assistant
         Secretary of GSRP, in form and substance reasonably satisfactory to the
         Special Subordinated Lender, dated as of the Closing Date, certifying

                           (i) the adoption by the Board of Directors of GSRP of
                  a resolution authorizing GSRP to enter into this Agreement and
                  the transactions and instruments contemplated hereby, and

                           (ii) the  incumbency  and authority of, and verifying
                  the specimen signatures of, the officers of GSRP authorized to
                  execute and deliver  this  Agreement  and the other  documents
                  contemplated hereunder.

                  (b) Legal  Opinion.  GSRP shall have  delivered to the Special
         Subordinated   Lender  a  legal   opinion  from  its  General   Counsel
         substantially in the form set forth in Attachment 10 hereto.

                  (c)  Expenses.  GSRP  shall  have  paid all fees and  expenses
         incurred  by  the  Special  Subordinated  Lender  in  the  negotiation,
         preparation and closing of this Statement of Intention and Agreement or
         otherwise required to be paid by it to the Special  Subordinated Lender
         pursuant to  Paragraph  6(c) below or Section  11.2 of the Existing LSA
         (including  the  fees  and  disbursements  of  counsel  to the  Special
         Subordinated Lender).

                  (d)      Other Documents.

                           (i)      GSRP  shall  have  executed and delivered to
                  the Special Subordinated Lender

                                    (A)   the   amendment   attachment   to  the
                           Construction    Project    Advance   Note   of   TFC,
                           substantially in the form of Attachment 4 hereto,

                                       17
<PAGE>

                                    (B)  the   modification   agreement  to  the
                           Steamboat   Blanket   Mortgage   and  the   Steamboat
                           Assignment  of  Rents,  substantially  in the form of
                           Attachment 9 hereto,

                                    (C)  the   assignment   of  Free  and  Clear
                           Proceeds, substantially in the form of Attachment 5-A
                           hereto  (together with  appropriate  UCC-1  financing
                           statements  in respect  thereof)  and the  collateral
                           assignment,  substantially  in the form of Attachment
                           5-B hereto and

                                    (D) the  collateral  assignment  of  certain
                           rights,  claims  and  proceeds  of GSRP  under  or in
                           respect  of  the  breach  of  the  Steamboat  General
                           Contractor of the Steamboat Construction Contract and
                           the breach of Steamboat  Architect  of its  agreement
                           with GSRP (in form and substance  satisfactory to the
                           Special Subordinated Lender) and

                           (ii) GSRP shall have delivered to the  Administrative
                  Agent a  date-down  endorsement  in respect  of the  Steamboat
                  Blanket Mortgage and such  endorsement  shall show no Liens in
                  and to the Steamboat Project other than Permitted Exceptions.

                  (e)   Representations.   The  warranties  and  representations
         contained or referred to in this  Statement of Intention  and Agreement
         shall be true in all material respects on the Closing Date.

                  (f)  Amendment  to Existing  LSA.  The Existing LSA shall have
         been amended to provide a Completion Date with respect to the Steamboat
         project of October __, 2000.

                  (g) Put Elimination.  GSRP shall have delivered to the Special
         Subordinated  Lender evidence that Fleet Bank no longer has a so-called
         "put"  option with respect to all or a portion of the loans that it has
         advanced to GSRP=s parent.

                  (h) Proceedings Satisfactory.  All actions taken in connection
         with the execution of this Statement of Intention and Agreement and all
         documents  and papers  relating  thereto shall be  satisfactory  to the
         Special Subordinated Lender and its counsel.

                                       18
<PAGE>

6.       MISCELLANEOUS

                  (a) Maximum  Rate.  GSRP and the Special  Subordinated  Lender
         intend  to  comply  at  all  times  with  applicable  usury  laws.  All
         agreements  between  the  GSRP  and the  Special  Subordinated  Lender,
         whether now existing or hereafter  arising and whether written or oral,
         are  hereby  limited  so that in no  contingency,  whether by reason of
         demand or acceleration of the payment of the Subordinated  Loan Tranche
         Advances or  otherwise,  shall the interest  contracted  for,  charged,
         received,  paid or agreed to be paid to the Special Subordinated Lender
         in respect of the Subordinated Loan Tranche Advances exceed the maximum
         amount  permissible  under  applicable  law (the "Maximum  Rate").  The
         Special  Subordinated  Lender may, in  determining  the Maximum Rate in
         effect from time to time, take advantage of any law, rule or regulation
         in  effect  from time to time  available  to the  Special  Subordinated
         Lender  which  exempts the Special  Subordinated  Lender from any limit
         upon the rate of  interest  it may  charge  or  grants  to the  Special
         Subordinated  Lender the right to charge a higher rate of interest than
         that otherwise  permitted by applicable law. If, from any  circumstance
         whatsoever,   interest  would  otherwise  be  payable  to  the  Special
         Subordinated  Lender  in  respect  of  the  Subordinated  Loan  Tranche
         Advances in excess of the Maximum Rate,  such  interest  payable to the
         Special  Subordinated  Lender shall be reduced to the Maximum Rate; and
         if from any  circumstance  the Special  Subordinated  Lender shall ever
         receive  anything of value  deemed  interest on the  Subordinated  Loan
         Tranche  Advances by  applicable  law in excess of the Maximum Rate, an
         amount  equal  to  any  excessive  interest  shall  be  applied  to the
         reduction of the principal of the  Subordinated  Loan Tranche  Advances
         and not to the  payment  of  interest,  or if such  excessive  interest
         exceeds  the  unpaid  balance of  principal  of the  Subordinated  Loan
         Tranche  Advances,  such excess shall be refunded to GSRP. All interest
         paid or agreed to be paid to the Special  Subordinated Lender shall, to
         the  extent  permitted  by  applicable  law,  be  amortized,  prorated,
         allocated  and  spread  throughout  the full  period  during  which the
         Subordinated  Loan Tranche Advances may be outstanding until payment in
         full of the principal  thereof so that the interest on the Subordinated
         Loan Tranche Advances (taking also into consideration,  for purposes of
         such amortization, prorating, allocation and spreading, the outstanding
         principal  balance  of the  Steamboat  Note as well as the  outstanding
         principal  balance of the Subordinated  Loan Tranche Advances) for such
         full  period  shall not exceed the  Maximum  Rate.  GSRP agrees that in
         determining  whether or not any interest payment  hereunder exceeds the

                                       19
<PAGE>

         Maximum Rate, any non-principal  payment (except payments  specifically
         described  herein as "interest")  including  without  limitation,  late
         charges,  shall to the  maximum  extent not  prohibited  by law,  be an
         expense, fee or premium rather than interest.  The Special Subordinated
         Lender hereby expressly disclaims any intent to contract for, charge or
         receive  interest in an amount  which  exceeds the  Maximum  Rate.  The
         provisions  of this  Statement of Intention and Agreement and the other
         documents  contemplated  herein  are  hereby  modified  to  the  extent
         necessary  to  conform  with the  limitations  and  provisions  of this
         paragraph, and this paragraph shall govern over all other provisions in
         any document or agreement  now or hereafter  existing.  This  paragraph
         shall never be superseded or waived unless there is a written  document
         executed by the  Special  Subordinated  Lender and the GSRP,  expressly
         declaring the usury  limitation  set forth in this paragraph to be null
         and  void,  and no other  method  or  language  shall be  effective  to
         supersede or waive this paragraph.

                  (b)  Parties,   Successors  and  Assigns.  This  Statement  of
         Intention and Agreement  shall be binding upon and inure to the benefit
         of the  parties  hereto and their  respective  successors  and  assigns
         (except that GSRP may not assign any of its rights hereunder),  and all
         representations,  covenants,  provisions and agreements by or on behalf
         of  GSRP  which  are  contained  in this  Statement  of  Intention  and
         Agreement  shall inure to the benefit of the  successors and assigns of
         the Special  Subordinated  Lender.  Except as otherwise provided,  this
         Statement of Intention and Agreement  shall not create and shall not be
         construed as creating any rights  enforceable  by, or benefits in favor
         of, any Person not a party hereto.

                  (c)  Costs.  Whether  or  not  the  transactions  contemplated
         hereunder  are  completed,  GSRP shall pay all  expenses of the Special
         Subordinated  Lender relating to negotiating,  preparing,  documenting,
         closing and  enforcing  this  Statement  of  Intention  and  Agreement,
         including, but not limited to:

                           (i)  the  cost  of  reproducing  this  Statement   of
                  Intention and Agreement and the documents contemplated herein;

                           (ii) the  fees  and  disbursements  of  the   Special
                  Subordinated Lender's counsel;

                           (iii) the Special Subordinated Lender's out-of-pocket
                  expenses  in  connection  with any  audits in  respect of GSRP
                  and/or the Collateral conducted by such Lender;

                           (iv)  all  fees  and  expenses  (including  fees  and
                  expenses  of  counsel  to  the  Special  Subordinated  Lender)
                  relating  to any  amendments,  waivers,  consents or review of
                  documents in connection  with this  Statement of Intention and
                  Agreement or relating to the funding of any Subordinated  Loan
                  Tranche Advance hereunder;

                                       20
<PAGE>

                           (v) all costs, outlays,  attorneys' fees and expenses
                  of  every  kind  and  character  had or  incurred  in (A)  the
                  enforcement  of  any of  the  provisions  of,  or  rights  and
                  remedies under, this Statement of Intention and Agreement, any
                  assignment  agreement,  or  any  other  document  contemplated
                  herein or hereby  and (B) the  preparation  for,  negotiations
                  regarding,  consultations  concerning, or the defense of legal
                  proceedings involving,  any claim or claims made or threatened
                  against the Special  Subordinated  Lender  arising out of this
                  transaction or the  protection of the Collateral  securing the
                  Subordinated Loan Tranche  Obligations,  expressly  including,
                  without  limitation,  the defense by the Special  Subordinated
                  Lender of any legal  proceedings  instituted  or threatened by
                  any Person (including,  without limitation,  GSRP or any other
                  Lender) to seek to recover or set aside any  payment or setoff
                  theretofore received or applied by Special Subordinated Lender
                  with respect to the Subordinated Loan Tranche Obligations;

                           (vi)  all  filing  and  recording  fees,   costs  and
                  expenses  which may be incurred  by the  Special  Subordinated
                  Lender with respect to the filing or recording of any document
                  or instrument  relating to the transactions  described in this
                  Statement of Intention and Agreement; and

                           (vii)  all  fees,  costs  and  expenses  owing to the
                  Disbursement Agent under the Loan Disbursement Agreement.

                  (d) Governing Law; Amendment.  This Statement of Intention and
         Agreement shall be governed by the internal laws of the State of Maine.
         To the  extent  any  provision  of  this  Statement  of  Intention  and
         Agreement is not enforceable under applicable law, such provision shall
         be  deemed  null and void and shall  have no  effect  on the  remaining
         portions of this Statement of Intention and  Agreement.  This Statement
         of Intention and  Agreement may not be amended or modified  except in a
         writing as to which both GSRP and the Special  Subordinated  Lender are
         parties.

                  (e) Section  Headings and Table of Contents and  Construction.
         The titles of the Sections  appear as a matter of convenience  only, do
         not  constitute  a part  hereof and shall not  affect the  construction
         hereof. The words "herein," "hereof," "hereunder" and "hereto" refer to
         this  Statement  of Intention  and  Agreement as a whole and not to any
         particular Section or other subdivision.

                                       21
<PAGE>

                  (f) Survival.  All warranties,  representations  and covenants
         made by GSRP herein or in any certificate or other instrument delivered
         by it or on its behalf under this  Statement of Intention and Agreement
         shall  be   considered   to  have  been  relied  upon  by  the  Special
         Subordinated  Lender and shall  survive the  execution  and delivery of
         this  Statement of Intention and  Agreement.  The obligation of GSRP to
         pay the Syndication Fee and the  Participation/Syndication  Costs shall
         survive  the  payment in full of the other  Subordinated  Loan  Tranche
         Obligations.

                  (g)      Further Assurances.

                           (i) GSRP  will,  at its own  expense,  do such  other
                  things,  execute and file such other  documents  and undertake
                  such  other  actions  as may be  reasonably  requested  by the
                  Special  Subordinated Lender to fully consummate and close the
                  transactions   contemplated   herein,    including,    without
                  limitation, amending any of the existing Blanket Mortgages and
                  Assignment   of  Rents  to  fully   cover   the   transactions
                  contemplated herein.

                           (ii)  If  any  Lender  (other  than  TFC,  Litchfield
                  Financial  Corporation or any other Lender having consented to
                  this Statement of Intention and  Agreement,  in writing) shall
                  instruct  the  Administrative  Agent  to act in a way  that is
                  contrary  to the terms and  provisions  of this  Statement  of
                  Intention and Agreement,  GSRP agrees, at its own expense,  to
                  do such things,  execute and file such documents and undertake
                  such  actions as may be  reasonably  requested  by the Special
                  Subordinated  Lender in order to cause such  instruction to be
                  rescinded and/or appropriately  modified to be consistent with
                  the terms and provisions hereof or, in lieu thereof, to modify
                  this  Statement  of  Intention  and  Agreement  (to the extent
                  approved by the Special  Subordinated Lender) to be consistent
                  with such instruction.

                           (iii) An independent consultant,  satisfactory to the
                  Special  Subordinated  Lender,  shall have  submitted a report
                  addressed  to  GSRP  and  the  Special   Subordinated   Lender
                  confirming  the  amount of the  remaining  Construction  Costs
                  needed to complete the construction of the Steamboat  Project,
                  and  such  report  shall  be   satisfactory   to  the  Special
                  Subordinated Lender.

   [Remainder of page intentionally left blank. Next page is signature page.]

                                       22
<PAGE>

         IN WITNESS  WHEREOF,  the  parties  have  executed  this  Statement  of
Intention and Agreement as of the day and year first above written.

GSRP:                                           Lender:

GRAND SUMMIT RESORT                             TEXTRON FINANCIAL
PROPERTIES, INC.                                CORPORATION

By /s/Mark P. Girard                            By/s/ Nicholas Mecca
     Name:Mark P. Girard                             Name: Nicholas Mecca
     Title:Vice President                            Title: Vice President

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00016-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00016-of-00352.parquet"}]]