EXHIBIT 99.1
FOR IMMEDIATE RELEASE
MeriStar Contacts: American Skiing Company Contact:
Melissa Thompson Skip King
Director, Corporate Communications Vice President, Communications
(202) 295-2228 (207) 824-5020
Jerry Daly or Carol McCune
Daly Gray Public Relations
(703) 435-6293
MERISTAR HOTELS & RESORTS AND AMERICAN SKIING REVISE SHARE EXCHANGE RATIO
WASHINGTON, D.C./NEWRY, Maine, February 22, 2001--MeriStar Hotels &
Resorts (NYSE: MMH), the nation's largest independent hotel management company,
and American Skiing Company (NYSE: SKI), the nation's largest ski resort
operating company, today announced that they have revised the share exchange
ratio of their previously announced merger agreement.
Under terms of an agreement announced in December 2000, MeriStar Hotels &
Resorts will merge into American Skiing Company in a tax-free, stock-for-stock
merger, and American Skiing Company will be renamed Doral International.
According to the original merger terms, each share of MeriStar stock would have
been exchanged for 1.88 shares of Doral International. Under the revised
exchange ratio, each share of MeriStar stock will be exchanged for 1.75 shares
of Doral International. American Skiing shares will remain outstanding and
American Skiing will change its name to Doral International.
"The change in the exchange ratio is the result of lower leakage from our
leased hotels in the fourth quarter of 2000 and our expectation that management
fees for the next several periods
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will be lower than we previously anticipated," said Paul Whetsell, chairman and
chief executive officer of MeriStar. "Although top-line revenue growth at our
leased hotels continued to be strong, we were not able to benefit at the bottom
line due to increased lease payments and higher operating costs, particularly
for energy, insurance and guest loyalty programs.
"With the conversion of the majority of our leases to management
contracts, we enter 2001 with a more stable, predictable earnings stream with
excellent growth potential. The management fees under the new management
contracts approximate the leakage that would have been earned under the previous
lease agreements and carry a more clear alignment of interest. The new
management contracts have a base fee of 2.5 percent and, including incentive
fees, can increase to as much as 4.0 percent of total revenues. As a result of
the decreased leakage prior to conversion, our expected total fees in 2001 have
changed from 2.75-3.25 percent to 2.5-3.0 percent."
Leslie B. Otten, chairman of American Skiing, commented, "The formation of
Doral International creates a new leader in the year-round leisure business. The
new company will have more diversified and less seasonal cash flow than its
predecessors and a capital structure to support growth. We are on track to
complete the merger transaction by the end of March 2001."
The proxy statement for both companies' shareholders is expected to be
mailed on or about February 26. The shareholders meeting will be held in late
March 2001 with the merger expected to close by March 31, 2001.
MeriStar Hotels & Resorts operates 269 hospitality properties with more
than 55,000 rooms in 36 states, the District of Columbia, Canada, Puerto Rico
and the U.S. Virgin Islands,
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including 54 properties managed by Flagstone Hospitality Management, a
subsidiary of MeriStar Hotels & Resorts. Through its Doral Golf brand, MeriStar
manages 11 golf courses. BridgeStreet Accommodations, a MeriStar subsidiary, is
one of the world's largest corporate housing providers, offering upscale, fully
furnished corporate housing throughout the United States, Canada and Europe. For
more information about MeriStar Hotels & Resorts, visit the company's Web site:
www.meristar.com.
Headquartered in Newry, Maine, American Skiing Company, founded by Leslie
B. Otten, is the largest operator of alpine ski, snowboard and golf resorts in
the United States. Its resorts include Steamboat in Colorado; Killington, Mount
Snow and Sugarbush in Vermont; Sunday River and Sugarloaf/USA in Maine; Attitash
Bear Peak in New Hampshire; The Canyons in Utah; and Heavenly in
California/Nevada. Additional information is available on the company's Web
site, www.peaks.com
AMERICAN SKIING COMPANY FILED A REGISTRATION STATEMENT ON FORM S-4 ON
JANUARY 8, 2001, (FILE NO. 333-53406) WITH THE SEC IN CONNECTION WITH THE MERGER
TRANSACTION. THE FORM S-4, ONCE IT HAS BEEN DECLARED EFFECTIVE BY THE SEC, WILL
CONTAIN A FINAL PROSPECTUS AND PROXY STATEMENT FOR THE SPECIAL MEETINGS OF BOTH
AMERICAN SKIING AND MERISTAR HOTELS & RESORTS, INC. AND OTHER DOCUMENTS.
AMERICAN SKIING AND MERISTAR PLAN TO MAIL THE FINAL JOINT PROXY STATEMENT AND
PROSPECTUS CONTAINED IN THE FORM S-4 TO THEIR STOCKHOLDERS. THE FORM S-4 AND
FINAL JOINT PROXY STATEMENT AND PROSPECTUS WILL CONTAIN IMPORTANT INFORMATION
ABOUT AMERICAN SKIING, MERISTAR, THE MERGER AND RELATED MATTERS. INVESTORS AND
STOCKHOLDERS SHOULD READ THE FINAL JOINT PROXY STATEMENT AND PROSPECTUS AND THE
OTHER DOCUMENTS FILED WITH THE SEC IN CONNECTION WITH THE MERGER CAREFULLY
BEFORE THEY MAKE ANY DECISION WITH RESPECT TO THE MERGER. A COPY OF THE MERGER
AGREEMENT WITH RESPECT TO THE MERGER WAS FILED BY BOTH AMERICAN SKIING AND
MERISTAR AS AN EXHIBIT TO EACH COMPANY'S RESPECTIVE FORM 8-K DATED DECEMBER 11,
2000. A COPY OF THE AMENDMENT TO THE MERGER AGREEMENT WILL BE FILED BY BOTH
AMERICAN SKIING AND MERISTAR AS AN EXHIBIT TO EACH COMPANY'S RESPECTIVE FORM 8-K
DATED FEBRUARY 22, 2001. THE FORM S-4, THE FINAL JOINT PROXY STATEMENT AND
PROSPECTUS, THE FORM 8-KS AND ALL OTHER DOCUMENTS FILED WITH THE SEC IN
CONNECTION WITH THE MERGER TRANSACTION ARE AVAILABLE AND FREE OF CHARGE AT THE
SEC'S WEB SITE, AT WWW.SEC.GOV. IN ADDITION, THE FINAL JOINT PROXY STATEMENT AND
PROSPECTUS, THE FORM 8-K
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AND ALL OTHER DOCUMENTS FILED WITH THE SEC IN CONNECTION WITH THE MERGER WILL BE
MADE AVAILABLE TO INVESTORS FREE OF CHARGE BY CALLING OR WRITING TO THE AMERICAN
SKIING AND MERISTAR CONTACT ADDRESSES LISTED ABOVE.
IN ADDITION TO THE FORM S-4, THE FINAL JOINT PROXY STATEMENT AND
PROSPECTUS AND THE OTHER DOCUMENTS FILED WITH THE SEC IN CONNECTION WITH THE
MERGER, BOTH AMERICAN SKIING AND MERISTAR ARE OBLIGATED TO FILE ANNUAL,
QUARTERLY AND SPECIAL REPORTS, PROXY STATEMENTS AND OTHER INFORMATION WITH THE
SEC. YOU MAY READ AND COPY ANY REPORTS, STATEMENTS AND OTHER INFORMATION FILED
WITH THE SEC AT THE SEC'S PUBLIC REFERENCE ROOMS AT 450 FIFTH STREET, N.W.,
WASHINGTON, D.C. 20549 OR AT THE OTHER PUBLIC REFERENCE ROOMS IN NEW YORK, NEW
YORK AND CHICAGO, ILLINOIS. PLEASE CALL THE SEC AT 1-800-SEC-0330 FOR FURTHER
INFORMATION ON PUBLIC REFERENCE ROOMS. FILINGS WITH THE SEC ALSO ARE AVAILABLE
TO THE PUBLIC FROM COMMERCIAL DOCUMENT-RETRIEVAL SERVICES AND AT THE WEB SITE
MAINTAINED BY THE SEC AT WWW.SEC.GOV.
THE IDENTITY OF THE PEOPLE WHO, UNDER SEC RULES, MAY BE CONSIDERED
"PARTICIPANTS IN THE SOLICITATION" OF MERISTAR'S STOCKHOLDERS IN CONNECTION WITH
THE PROPOSED MERGER, AND A DESCRIPTION OF THEIR INTERESTS, IS AVAILABLE IN AN
SEC FILING ON SCHEDULE 14A, WHICH WILL BE MADE BY MERISTAR. A LIST OF
"PARTICIPANTS IN THE SOLICITATION" OF AMERICAN SKIING'S STOCKHOLDERS IN
CONNECTION WITH THE PROPOSED MERGER, AND A DESCRIPTION OF THEIR INTERESTS, IS
AVAILABLE IN AN SEC FILING ON SCHEDULE 14A, WHICH WILL BE MADE BY AMERICAN
SKIING.
THIS PRESS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS ABOUT MERISTAR
HOTELS & RESORTS, INC., INCLUDING THOSE STATEMENTS REGARDING FUTURE OPERATING
RESULTS AND THE TIMING AND COMPOSITION OF REVENUES, AMONG OTHERS. EXCEPT FOR
HISTORICAL INFORMATION, THE MATTERS DISCUSSED IN THIS PRESS RELEASE ARE
FORWARD-LOOKING STATEMENTS THAT ARE SUBJECT TO CERTAIN RISKS AND UNCERTAINTIES
THAT COULD CAUSE THE ACTUAL RESULTS TO DIFFER MATERIALLY, INCLUDING THE
FOLLOWING: THE ABILITY OF THE COMPANIES TO COMPLETE THE MERGER, THE ABILITY OF
THE COMPANY TO SUCCESSFULLY IMPLEMENT ITS ACQUISITION STRATEGY AND OPERATING
STRATEGY; THE MERGED COMPANY'S ABILITY TO MANAGE RAPID EXPANSION; SIGNIFICANT
LEVERAGE; CHANGES IN ECONOMIC CYCLES; COMPETITION FROM OTHER HOSPITALITY
COMPANIES; AND CHANGES IN THE LAWS AND GOVERNMENT REGULATIONS APPLICABLE TO THE
COMPANIES.
THE FORWARD-LOOKING STATEMENTS ABOUT AMERICAN SKIING COMPANY CONTAINED IN
THIS PRESS RELEASE ARE NOT BASED ON HISTORICAL FACTS, BUT RATHER REFLECT
AMERICAN SKIING COMPANY'S CURRENT EXPECTATIONS CONCERNING FUTURE RESULTS AND
EVENTS. SIMILARLY, STATEMENTS THAT DESCRIBE THE COMPANY'S OBJECTIVES, PLANS OR
GOALS ARE OR MAY BE FORWARD-LOOKING STATEMENTS. SUCH FORWARD-LOOKING STATEMENTS
INVOLVE A NUMBER OF RISKS AND UNCERTAINTIES. IN ADDITION TO FACTORS DISCUSSED
ABOVE, OTHER FACTORS THAT COULD CAUSE ACTUAL RESULTS, PERFORMANCES OR
ACHIEVEMENTS TO DIFFER MATERIALLY FROM THOSE PROJECTED INCLUDE, BUT ARE NOT
LIMITED TO, THE FOLLOWING: CHANGES IN REGIONAL AND NATIONAL BUSINESS AND
ECONOMIC CONDITIONS AFFECTING BOTH AMERICAN SKIING COMPANY'S RESORT OPERATING
AND REAL ESTATE SEGMENTS; COMPETITION AND PRICING PRESSURES; FAILURE TO
EFFECTIVELY INTEGRATE OR OPERATE RECENTLY ACQUIRED COMPANIES AND ASSETS; FAILURE
TO RENEW OR REFINANCE EXISTING FINANCIAL LIABILITIES AND OBLIGATIONS OR ATTAIN
NEW OUTSIDE FINANCING; FAILURE OF ON-MOUNTAIN IMPROVEMENTS AND OTHER CAPITAL
EXPENDITURES TO GENERATE INCREMENTAL REVENUE; ADVERSE WEATHER CONDITIONS
REGIONALLY AND NATIONALLY; SEASONAL BUSINESS ACTIVITY; CHANGES TO
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FEDERAL, STATE AND LOCAL LAND USE REGULATIONS; CHANGES TO FEDERAL, STATE AND
LOCAL REGULATIONS AFFECTING BOTH AMERICAN SKIING COMPANY'S RESORT OPERATING AND
REAL ESTATE SEGMENTS; LITIGATION INVOLVING ANTI-TRUST, CONSUMER AND OTHER
ISSUES; FAILURE TO RENEW LAND LEASES AND FOREST SERVICE PERMITS; DISRUPTIONS IN
WATER SUPPLY THAT WOULD IMPACT SNOWMAKING OPERATIONS AND IMPACT OPERATIONS; THE
LOSS OF ANY OF OUR EXECUTIVE OFFICERS OR KEY OPERATING PERSONNEL; CONTROL OF
AMERICAN SKIING COMPANY BY PRINCIPAL STOCKHOLDERS; FAILURE TO HIRE AND RETAIN
QUALIFIED EMPLOYEES AND OTHER FACTORS LISTED FROM TIME-TO-TIME IN AMERICAN
SKIING COMPANY'S DOCUMENTS FILED BY THE COMPANY WITH THE SECURITIES EXCHANGE
COMMISSION. THE FORWARD-LOOKING STATEMENTS INCLUDED IN THIS DOCUMENT ARE MADE
ONLY AS OF THE DATE OF THIS DOCUMENT AND UNDER SECTION 27A OF THE SECURITIES ACT
AND SECTION 21E OF THE EXCHANGE ACT, WE DO NOT HAVE ANY OBLIGATION TO PUBLICLY
UPDATE ANY FORWARD-LOOKING STATEMENTS TO REFLECT SUBSEQUENT EVENTS OR
CIRCUMSTANCES.
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