WAIVER AND AGREEMENT
WAIVER AND AGREEMENT dated as of May 15, 2001 (this "Waiver") with
respect to the Amended, Restated and Consolidated Credit Agreement dated as of
October 12, 1999 (as amended, the "Credit Agreement") by and among American
Skiing Company ("American Skiing") and the other borrowers party thereto
(collectively, the "Borrowers"), the lenders party thereto (the "Lenders") and
Fleet National Bank, N.A. (formerly known as BankBoston, N.A.), as agent (the
"Agent").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to the Credit Agreement, the Lenders have made Loans
and other financial accommodations to the Borrowers which remain outstanding;
WHEREAS, certain Events of Default may have occurred and may be
continuing; and
WHEREAS, the Borrowers have requested that the Agent and the Lenders
waive such possible Events of Default and defer the payment of the Deferred
Default Spread (as defined below), in each case, during the Waiver Period (as
defined below), and the Agent and the Lenders are willing to do so, but only on
the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and for other good
and valuable consideration the receipt and sufficiency of which is hereby
acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Defined Terms. Unless otherwise defined herein,
capitalized terms used herein have the meanings assigned in the Credit Agreement
and the following terms shall have the following meanings:
"Deferred Default Spread": the spread between (a) the contractual rate
of interest due on the Loans pursuant to Sections 2.3, 2.5 and 2.19 of the
Credit Agreement, as modified by Section 4.1(b) of this Waiver and (b) the
default rate of interest due on the Loans accruing upon the occurrence and
during the continuance of an Event of Default pursuant to Section 2.7 of
the Credit Agreement.
"Effective Date": (i) November 1, 2000 with respect to the Swap Event
of Default and (ii) April 29, 2001 with respect to the Specified Events of
Default (other than the Swap Event of Default).
"Expiration Date": June 13, 2001.
"Specified Events of Default": Events of Default arising or which may
arise in respect of Section 10.1(b) of the Credit Agreement as a result of
the Borrowers' failure to comply with Sections 7.1, 7.2, 7.3, 7.5 and 8.15
of the Credit Agreement.
"Swap Event of Default": Events of Default arising or which may arise
in respect of Section 10.1(b) of the Credit Agreement as a result of the
Borrowers' failure to comply with Section 8.15 of the Credit Agreement.
"Termination Date": the occurrence of an event of termination as
provided in Article III of this Waiver.
"Waiver Period": the period beginning on the Effective Date and ending
on the earlier of (a) the Termination Date or (b) the Expiration Date.
ARTICLE II
WAIVER AND DEFERRAL
Section 2.1. Waiver. Subject to the terms and conditions hereof, the
Agent and the Lenders hereby agree to waive during the Waiver Period the
Specified Events of Default.
Section 2.2. Deferral. The Agent and the Lenders hereby agree to defer
payment by the Borrowers of the Deferred Default Spread during the Waiver
Period; provided, that the Deferred Default Spread shall be paid in full in cash
immediately upon the earlier of the Termination Date or the Expiration Date; it
being understood that during the Waiver Period the Borrowers shall continue to
pay the contractual rate of interest due on the Loans pursuant to Sections 2.3,
2.5 and 2.19 of the Credit Agreement.
ARTICLE III
WAIVER EVENTS OF TERMINATION
Upon the occurrence of any of the following events:
(a) the Borrowers shall default in the observance or performance of
any agreement or covenant contained in this Waiver;
(b) the occurrence of a Default or Event of Default (other than a
Specified Event of Default);
then, and in any such event, the provisions of Article II of this Waiver shall
immediately and automatically terminate and thereafter such Article II shall
have no force or effect.
ARTICLE IV
AGREEMENTS
Section 4.1. Agreements. (a) Notwithstanding anything to the contrary
in the Credit Agreement, during the Waiver Period the Borrowers shall be
permitted (i) to borrow, prepay, in whole or in part, and reborrow, in
accordance with the terms and conditions hereof (A) Revolving Credit Advances
and (B) Swing Line Loans, which, in each case, shall be Base Rate Loans and (ii)
to open Letters of Credit; provided, however, notwithstanding anything to the
contrary in the Credit Agreement, during the Waiver Period the Borrowers shall
not be permitted to make Revolving Credit Advances in excess of $65,000,000
without the prior consent of the Agent and the Lenders. Notwithstanding anything
to the contrary set forth in the Credit Agreement, during the Waiver Period,
each Notice of Borrowing shall be made directly to the attention of Daniel D.
Butler (Fleet National Bank, 111 Westminster Street Providence, Rhode Island
02903; Fax: 401-278-6004) and shall be accompanied by a certificate signed by
the Borrowers' Chief Executive Officer or Chief Financial Officer stating that,
as of the date of the Borrowing, the Borrowers are in compliance with the terms
of the Credit Agreement and this Waiver.
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(b) Notwithstanding anything to the contrary set forth in the Credit
Agreement, for the period beginning May 1, 2001 and ending on the Expiration
Date, interest shall be payable on the Loans at a rate per annum equal to the
Base Rate plus 3.00%.
(c) The Borrowers hereby agree that, during the Waiver Period,
notwithstanding the provisions of Section 9.1 of the Credit Agreement, neither
the Borrowers nor any Restricted Subsidiary shall create, incur, suffer or
permit to exist, or assume or guarantee, directly or indirectly, Indebtedness
pursuant to Section 9.1(f) of the Credit Agreement.
(d) The Borrowers hereby agree that, during the Waiver Period,
notwithstanding the provisions of Section 9.2 of the Credit Agreement, neither
the Borrowers nor any Restricted Subsidiary shall create, incur, suffer to be
created or incurred, directly or indirectly, Liens pursuant to Section 9.2(h) of
the Credit Agreement.
(e) The Borrowers hereby agree that, during the Waiver Period,
notwithstanding the provisions of Section 9.3 of the Credit Agreement, neither
the Borrowers nor any Restricted Subsidiary shall make or commit to make,
directly or indirectly, Investments pursuant to Sections 9.3(h) or (l) of the
Credit Agreement.
(f) The Borrowers hereby agree that, during the Waiver Period,
notwithstanding the provisions of Section 9.4 of the Credit Agreement, neither
the Borrowers nor any Restricted Subsidiary shall make or commit to make,
directly or indirectly, any Permitted Acquisitions.
(g) The Borrowers hereby agree that, during the Waiver Period,
notwithstanding the provisions of Section 9.6 of the Credit Agreement, neither
the Borrowers nor any Restricted Subsidiary shall make or commit to make,
directly or indirectly, any Distribution or any other payment on account of the
purchase, acquisition, redemption or other retirement of any shares of stock.
(h) Except as set forth on the Schedule of Capital Expenditures
attached hereto, the Borrowers hereby agree that, during the Waiver Period,
notwithstanding the provisions of Section 9.7 of the Credit Agreement, neither
the Borrowers nor any Restricted Subsidiary shall make or commit to make,
directly or indirectly, any Capital Expenditure without the prior written
consent of the Agent.
(i) Except for American Skiing's transfer of ownership in Community
Water Company to Summit Water Company, the Borrowers hereby agree that, during
the Waiver Period, notwithstanding the provisions of Section 9.8 of the Credit
Agreement, neither the Borrowers nor any Restricted Subsidiary shall not make or
commit to make, directly or indirectly, any Permitted Disposition without the
prior written consent of the Agent.
(j) Except for the paid-in-kind dividends on the Series B Preferred
Stock, the Borrowers hereby agree that, during the Waiver Period, neither the
Borrowers nor any Restricted Subsidiary shall make any payment to Oak Hill
Capital Partners, L.P., Oak Hill Securities Fund, L.P., or any affiliate thereof
on account of any management fees or any other amounts (other than the
reimbursement of reasonable out-of-pocket costs and expenses for which the
Borrowers are liable in respect of) owing to Oak Hill Capital Partners, L.P.,
Oak Hill Securities Fund, L.P. or any such affiliate; provided that all such
amounts not paid as aforesaid shall be deemed to accrue.
(k) On or before May 16, 2001, the Borrowers shall have retained
Credit Suisse First Boston, or another nationally-recognized investment banker
reasonably acceptable to the Agent and the Lenders (the "Investment Banker").
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The Investment Banker shall be retained for the purpose of formulating
alternative business strategies on behalf of the Borrowers. The Investment
Banker shall (i) furnish the Borrowers with monthly written reports on the
status of asset disposition on the last Friday of each month (which will then be
forwarded by the Borrowers to the Lenders promptly upon the completion of their
review) and (ii) provide weekly verbal reports on the status of asset
disposition in conjunction with a regularly scheduled conference call among the
Agent, the Lenders and the Borrowers.
(l) The Borrowers hereby agree that, in the event the Agent or its
counsel determines to retain a financial advisor and/or an investment banker,
the Borrowers shall cooperate in all respects with any such financial advisor or
investment banker and shall pay or reimburse the Agent for all reasonable fees
and out-of-pocket expenses incurred in connection therewith.
(m) The Borrowers hereby agree to provide, as promptly as possible but
no later than Thursday of each week, an income statement which shall detail
revenues and expenses for the prior week, in form and substance satisfactory to
the Agent.
Section 4.2. Agreements Deemed Agreements under the Credit Agreement.
For purposes of the Credit Agreement, the agreements of the Borrowers contained
in this Article IV shall be deemed to be, and shall be, agreements under the
Credit Agreement.
ARTICLE V
WAIVER EFFECTIVE DATE
Section 5.1 Effective Date. This Waiver shall become effective as of
the date hereof upon receipt by the Agent of (a) counterparts of this Waiver,
duly executed and delivered by the Borrowers, the Agent and the Lenders, (b) the
Waiver Fee (as defined below) and (c) payment in full in cash of the invoiced
and unpaid fees and expenses of the Agent's professionals as of May 1, 2001 and
as set forth on the Schedule of Fees attached hereto.
ARTICLE VI
INTERPRETATION
Section 6.1. Continuing Effect of the Credit Agreement. The Borrowers,
the Agent and each Lender hereby acknowledges and agrees that the Credit
Agreement shall continue to be and shall remain unchanged and in full force and
effect in accordance with its terms, except as expressly modified hereby.
Section 6.2. No Waiver. Nothing contained in this Waiver shall be
construed or interpreted or is intended as a waiver of any Default or Event of
Default (other than the Specified Events of Default) or of any rights, powers,
privileges or remedies that the Agent or the Lenders have or may have under the
Credit Agreement, any other related document or applicable law on account of
such Default or Event of Default (other than the Specified Events of Default).
The Borrowers hereby acknowledge and agree that, at the end of the Waiver
Period, the provisions of Article II of this Waiver shall become of no force and
effect and the Agent and the Lenders shall be free, in accordance with the
Credit Agreement, to exercise and enforce, or to take steps to exercise and
enforce, all rights, powers, privileges and remedies available to them under the
Credit Agreement, any related document or applicable law on account of the
Specified Events of Default (or any other Default or Event of Default) as if
this Waiver had not been entered into by the parties hereto.
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ARTICLE VII
MISCELLANEOUS
Section 7.1. Representations and Warranties. The Borrowers hereby
represent and warrant as of the date hereof that, after giving effect to this
Waiver, (a) no Default or Event of Default has occurred and is continuing,
except the Specified Events of Default, and (b) all representations and
warranties of the Borrowers contained in the Credit Agreement are true and
correct in all material respects with the same effect as if made on and as of
such date, except that Section 5.22(a) of the Credit Agreement shall be deemed
to exclude any Specified Event of Default.
Section 7.2. Payment of Fees and Expenses. (a) The Borrowers hereby
agree to pay or reimburse the Agent on demand for all its reasonable
out-of-pocket costs and expenses incurred in connection with the preparation and
execution of this Waiver, including, without limitation, the reasonable fees and
disbursements of counsel to the Agent. In furtherance of the provisions of this
Section 7.2 and Section 14.5 of the Credit Agreement, the Borrowers hereby agree
that the Agent shall be entitled, upon one Business Day's notice to the
Borrowers, to debit any operating account of any Borrower to collect costs and
expenses to which the Agent is entitled pursuant to this Section 7.2 and Section
14.5 of the Credit Agreement.
(b) The Borrowers further agree to pay to the Agent, for the account
of each Lender that executes this Waiver on a pro rata basis, a fee in an amount
equal to $150,000 (the "Waiver Fee"). The Waiver Fee shall be due and payable on
the Effective Date.
(c) The Borrowers further agree to pay to the Agent, for its own
account, on the first Business Day of each month, an agency fee in the amount of
$10,000. This monthly payment shall be in lieu of the annual agency fee
otherwise due under the Credit Agreement.
Section 7.3. Counterparts. This Waiver may be executed by the parties
hereto in any number of separate counterparts, and all of said counterparts
taken together shall be deemed to constitute one and the same instrument.
Section 7.4. GOVERNING LAW. THIS WAIVER AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES UNDER THIS WAIVER SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE COMMONWEALTH OF MASSACHUSETTS.
Section 7.5. Reservation of Rights. Notwithstanding anything contained
in this Waiver, the Borrowers acknowledge that the Agent and the Lenders do not
waive, and expressly reserve, the right to exercise, at any time, any and all of
their rights and remedies under the Credit Agreement, any other related document
and applicable law on account of any Default or Event of Default (other than
Specified Events of Default).
Section 7.6. Confirmation of Indebtedness. The Borrowers hereby
confirm and acknowledge that, as of the Effective Date, (i) the Borrowers are
truly and justly indebted to the Lenders, without defense, counterclaim or
offset of any kind and (ii) the Borrowers are liable to the Lenders in respect
of Loans in the aggregate principal amount of $110,212,965.
Section 7.7. Waiver. The Borrowers hereby release, waive, and forever
relinquish all claims, demands, obligations, liabilities and causes of action of
whatever kind or nature, whether known or unknown, which any of them have, may
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have, or might assert at the time of execution of this Waiver or in the future
against the Agent, the Lenders and/or their respective parents, affiliates,
participants, officers, directors, employees, agents, attorneys, accountants,
consultants, successors and assigns (collectively, the "Lender Group"), directly
or indirectly, which occurred, existed, was taken, permitted or begun prior to
the execution of this Waiver, arising out of, based upon, or in any manner
connected with (i) any transaction, event, circumstance, action, failure to act
or occurrence of any sort or type, whether known or unknown, with respect to the
Credit Agreement, any other Lender Agreement and/or the administration thereof
or the obligations created thereby; (ii) any discussions, commitments,
negotiations, conversations or communications with respect to the refinancing,
restructuring or collection of any obligations related to the Credit Agreement,
any other Lender Agreement and/or the administration thereof or the obligations
created thereby, or (iii) any matter related to the foregoing; provided,
however, that the provisions of this Section 7.7 shall not apply to any such
matters of which the Borrowers are presently unaware and which constitute or
result from the gross negligence and/or willful misconduct of any member of the
Lender Group.
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IN WITNESS WHEREOF, the parties hereto have caused this Waiver to be
duly executed and delivered by their proper and duly authorized officers as of
the date first above written.
AMERICAN SKIING COMPANY
By:/s/Mark J. Miller
Title:
SUNDAY RIVER SKIWAY CORPORATION
By:/s/Mark J. Miller
Title:
SUNDAY RIVER LTD.
By:/s/Mark J. Miller
Title:
PERFECT TURN, INC.
By:/s/Mark J. Miller
Title:
SUNDAY RIVER TRANSPORTATION INC.
By:/s/Mark J. Miller
Title:
L.B.O. HOLDING, INC.
By:/s/Mark J. Miller
Title:
SUGARBUSH RESORT HOLDINGS, INC.
By:/s/Mark J. Miller
Title:
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SUGARBUSH LEASING COMPANY
By:/s/Mark J. Miller
Title:
SUGARBUSH RESTAURANTS, INC.
By:/s/Mark J. Miller
Title:
MOUNTAIN WASTEWATER TREATMENT, INC.
By:/s/Mark J. Miller
Title:
S-K-I, LTD.
By:/s/Mark J. Miller
Title:
KILLINGTON, LTD.
By:/s/Mark J. Miller
Title:
MOUNT SNOW LTD.
By:/s/Mark J. Miller
Title:
PICO SKI AREA MANAGEMENT COMPANY
By:/s/Mark J. Miller
Title:
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RESORT SOFTWARE SERVICES, INC.
By:/s/Mark J. Miller
Title:
KILLINGTON RESTAURANTS, INC.
By:/s/Mark J. Miller
Title:
DOVER RESTAURANTS, INC.
By:/s/Mark J. Miller
Title:
SUGARLOAF MOUNTAIN CORPORATION
By:/s/Mark J. Miller
Title:
MOUNTAINSIDE
By:/s/Mark J. Miller
Title:
ASC UTAH
By:Mark J. Miller
Title:
STEAMBOAT SKI & RESORT CORPORATION
By:/s/Mark J. Miller
Title:
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HEAVENLY SKI & RESORT CORPORATION
By:/s/Mark J. Miller
Title:
HEAVENLY CORPORATION
By:/s/Mark J. Miller
Title:
HEAVENLY VALLEY, LIMITED PARTNERSHIP
By:Heavenly Corporation,its general partner
By:/s/Mark J. Miller
Title:
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FLEET NATIONAL BANK (successor in interest
to BankBoston, N.A.), as Agent
By:/s/Daniel D. Butler
Title:Vice President
FLEET NATIONAL BANK (successor in interest
to BankBoston, N.A.), as a Lender
By:/s/Daniel D. Butler
Title:
WELLS FARGO BANK, NATIONAL ASSOCIATION,as a
Lender
By:/s/illegible
Title:Vice President
U.S. BANK NATIONAL ASSOCIATION, as a Lender
By:/s/illegible
Title:Vice President
FIRST SECURITY BANK, N.A., as a Lender
By:________________________________________
Title:
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THE HOWARD BANK, N.A., as a Lender
By:/s/illegible
Title:V.P.
BLACK DIAMOND CLO 1998-1 LTD., as a Lender
By:/s/John H. Cullinano
Title:Director
BLACK DIAMOND CLO 2000-1 LTD., as a Lender
By:/s/David Dyer
Title:Director
BLACK DIAMOND INTERNATIONAL FUNDING, LTD.,
as a Lender
By:John H. Cullinano
Title:Director
MORGAN STANLEY SENIOR FUNDING, INC., as a
Lender
By:________________________________________
Title:
OASIS COLLATERALIZED HIGH INCOME PORTFOLIOS
-I, LTD., as a lender
By:Invesco Senior Secured Management, Inc.,
as sub-advisor
By:________________________________________
Title:
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MERRILL LYNCH PRIME RATE PORTFOLIO, as a
Lender
By: Merrill Lynch Asset Management, L.P.,
as Investment Advisor
By:/s/Joseph P. Matteo
Title:Authorized Signatory
MERRILL LYNCH SENIOR FLOATING RATE FUND,
INC., as a Lender
By:________________________________________
Title:
CAPTIVA II FINANCE LTD., as a Lender
By:/s/David Dyer
Title:Director
KZH-PAMCO LLC, as a Lender
By:/s/Susan Lee
Title:Authorized Agent
KZH III LLC, as a Lender
By:________________________________________
Title:
PAM CAPITAL FUNDING L.P., as a Lender
By: Highland Capital Management, L.P., as
Collateral Manager
By:/s/Todd Travers
Title:Senior Portfolio Manager
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PAMCO CAYMAN, LTD., as a Lender
By: Highland Capital Management, L.P., as
Collateral Manager
By:/s/Todd Travers
Title:Senior Portfolio Manager
VAN KAMPEN PRIME RATE INCOME TRUST, as a
Lender
By: Van Kampen Investment Advisory Corp.
By:Howard Tiffen
Title:Senior Vice President
DEBT STRATEGIES FUND II, INC., as a Lender
By:________________________________________
Title:
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