UNLIMITED GUARANTY
GUARANTY, dated as of July 20, 1998, by American Skiing Company, (the
"Guarantor"), in favor of BancBoston Leasing Inc., a Massachusetts corporation,
with its principal place of business at 100 Federal Street, Boston,
Massachusetts 02110 (the "Lessor"). In consideration of the Lessor's providing
certain leasing accommodations to ASC Leasing, Inc., ASC Transportation, Inc.,
Killington, LTD., Sugarloaf Mountain Corp., Heavenly Valley Ski and Resort
Corporation and Steamboat Ski and Resort Corporation because the Guarantor will
benefit from the leasing accommodations provided to the Lessees, the Guarantor
agree as follows:
1. Guaranty of Payment and Performance. The Guarantor hereby guarantees to
the Lessor the full and punctual payment when due (whether at maturity,
by acceleration or otherwise), and performance by each Lessee of all
liabilities, indemnities, agreements and other obligations under any form
of lease agreement with the Lessor and under any document executed in
connection therewith, whether direct or indirect, primary or secondary,
absolute or contingent, due or to become due, secured or unsecured, now
existing or hereafter arising or acquired (the "Obligations"). The
Guaranty is an absolute, unconditional and continuing guaranty of the
full and punctual payment and performance of the Obligations and not of
their collectibility only and is in no way conditioned upon any
requirement that the Lessor first attempt to collect any of the
Obligations from any Lessee or resort to any security or other means of
obtaining their payment. If any Lessee defaults in the payment or
performance of any of the Obligations, the obligations of the Guarantor
under this Guaranty shall become immediately due and payable to the
Lessor, without demand or notice of any nature, all of which are
expressly waived by the Guarantor. Payments by the Guarantor hereunder
may be required by the Lessor on any number of occasions.
2. Guarantor's Agreement to Pay. The Guarantor further agrees, as the
principal obligor and not as a guarantor only, to pay to the Lessor, on
demand, all costs and expenses (including court costs and legal expenses)
incurred or expended by the Lessor in connection with the Obligations, this
Guaranty and the enforcement thereof, together with interest on amounts
recoverable under this Guaranty, from the time such amounts become due
until payment, at the rate per annum equal to 18% or, if higher, the rate
of interest announced, from time to time, by BankBoston, N.A. ("BankBoston,
N.A.") at its head office as its Base Rate, plus 4%; provided that if such
interest exceeds the maximum amount permitted to be paid under applicable
law, then such interest shall be reduced to such maximum permitted amount.
3. Waiver by Guarantor; Lessor' Freedom to Act. The Guarantor agrees that
the Obligations will be paid and performed strictly in accordance with
their respective terms regardless of any law, regulation or order, now or
hereafter in effect in any jurisdiction which affects any term or
provision of such Obligations or the rights of the Lessor with respect
thereto. The Guarantor waives presentment, demand, protest, notice of
acceptance, notice of Obligations incurred and all other notices of any
kind, all defenses which may be available by virtue of any valuation,
stay, moratorium law or other similar law, now or hereafter in effect,
any right to require the marshaling of assets of any Lessee, the benefit
of all exemption and homestead laws, and all suretyship defenses
generally. Without limiting the generality of the foregoing, the
Guarantor agrees to the provisions of any instrument evidencing, securing
or otherwise executed in connection with any Obligation and agrees that
the obligations of the Guarantor under this Guaranty shall not be
released or discharged, in whole or in part, or otherwise affected by (i)
the failure of the Lessor to assert any claim or demand or to enforce any
right or remedy against any Lessee, (ii) any extensions or renewals or
any Obligation including, without limitation, the leasing of additional
equipment to any Lessee or entering into additional leases any Lessee,
(iii) any rescissions, waivers, amendments or modifications of any of the
terms or provisions of any agreement evidencing, securing or otherwise
executed in connection with any Obligation, (iv) the substitution or
release of any entity primarily or secondarily liable for any Obligation,
(v) the adequacy of any rights the Lessor may have against any collateral
or other means of obtaining repayment of the Obligations, (vi) the
impairment of any collateral securing the obligations including, without
limitation, the failure to perfect or to preserve any rights the Lessor
might have in such collateral, or (vii) any other act or omission which
might, in any manner or to any extent, vary the risk of the Guarantor or
otherwise operate as a release or discharge of the Guarantor, all of
which may be done without notice to the Guarantor.
4. Unenforceability of Obligations Against Lessees. If for any reason any
Lessee has no legal existence or is under no legal obligation to discharge
any of the Obligations, or if any of the Obligations have become
irrecoverable from any Lessee by operation of law or for any other reason,
this Guaranty shall nevertheless be binding on the Guarantor to the same
extent as if the Guarantor, at all times, had been the principal obligor on
all such Obligations. In the event that any acceleration of the time for
payment of the Obligations is stayed upon the insolvency, bankruptcy or
reorganization of any Lessee, or for any other reason, all such amounts,
which may otherwise be subject to acceleration under the terms of any
agreement evidencing, securing or otherwise executed in connection with any
Obligation, shall be immediately due and payable by the Guarantor.
5. Subrogation; Subordination. Until the payment and performance in full of
all Obligations and any and all obligations of any Lessee to any
affiliate of the Lessor, the Guarantor shall not exercise any rights
against such Lessee arising as a result of any payment by the Guarantor
under this Guaranty, by way of subrogation or otherwise, and will not
assert or prove any claim in competition with the Lessor or its
affiliates with respect to any payment hereunder in bankruptcy or
insolvency proceedings of any nature; the Guarantor will not claim any
set-off or counterclaim against such Lessee with respect to any liability
of the Guarantor to such Lessee; and the Guarantor waives any benefit of
and any right to participate in any collateral which may be held by the
Lessor or any affiliate of the Lessor. The payment of any amounts due
with respect to any indebtedness of any Lessee, now or hereafter held by
the Guarantor, is hereby subordinated to the prior payment in full of the
Obligations, provided, however, that the Guarantor may accept scheduled
payments of amounts due from as set forth in the documents evidencing
such indebtedness, prior to a default in the payment and performance of
the Obligations. The Guarantor agrees that, after the occurrence of any
default in the payment or performance of the Obligations, the Guarantor
will not demand, sue for or otherwise attempt to collect any such
indebtedness of the Lessee to the Guarantor until the Obligations shall
have been paid in full. If, notwithstanding the foregoing sentence, the
Guarantor shall collect, enforce or receive any amounts with respect to
such indebtedness, such amounts shall be collected, enforced and received
by the Guarantor as trustee for the Lessor, and shall be paid over to the
Lessor on account of the Obligations, without affecting in any manner the
liability of the Guarantor under the other provisions of this Guaranty.
6. Security; Set-Off. Regardless of the adequacy of any collateral or other
means of obtaining repayment of the Obligations, the Lessor is hereby
authorized, at any time and from time to time, without notice to the
Guarantor (any such notice being expressly waived by the Guarantor), and
to the fullest extent permitted by law, to set off and to apply all
deposits (general or special, time or demand, provisional or final) and
other sums credited by or due from the Lessor to the Guarantor against
the obligations of the Guarantor under this Guaranty, whether or not the
Lessor shall have made any demand under this Guaranty.
7. Further Assurances. The Guarantor agrees that it will, from time to time
at the request of the Lessor, provide to the Lessor its most recent
audited and unaudited balance sheets and related statements of income and
changes in financial condition (prepared on a consolidated basis with the
Guarantor's subsidiaries, if any) and such other information relating to
the business and affairs of the Guarantor as the Lessor may reasonably
request. The Guarantor also agrees, upon demand by the Lessor, after any
change in the condition or affairs (financial or otherwise) of the
Guarantor deemed by the Lessor to be adverse and material, to secure the
payment and performance of its obligations under this Guaranty by
delivering, assigning, transferring or granting to the Lessor a security
interest in additional collateral of a value and character reasonably
satisfactory to the Lessor. In connection therewith, the Guarantor hereby
authorizes the Lessor to file any financing statement deemed by the
Lessor to be necessary or desirable to perfect any security interest
granted by the Guarantor to the Lessor, and as agent for the Guarantor,
to sign the name of the Guarantor thereto. The Guarantor also agrees to
do all such things and execute all such documents, including financing
statements, as the Lessor may consider necessary or desirable to give
full effect to this Guaranty and to perfect and preserve the rights and
powers of the Lessor under this Guaranty.
8. Termination; Reinstatement. This Guaranty shall remain in full force and
effect until the Lessor is given written notice of the Guarantor's
intention to discontinue this Guaranty, notwithstanding any intermediate
or temporary payment or settlement of the whole or any part of the
Obligations. No such notice shall be effective unless it is received and
acknowledged by an officer of the Lessor at its principal place of
business. No such notice shall affect any rights of the Lessor under this
Guaranty or of any affiliate of the Lessor including, without limitation,
rights with respect to (i) Obligations incurred prior to the receipt of
such notice, (ii) Obligations incurred after receipt of such notice but
pursuant to a contract or commitment in existence prior to such receipt,
and (iii) all equipment schedules, lease agreements, instruments,
documents, invoices, bills of sale, and writings made by or for the
account of any Lessee with the Lessor or with any of its agents or
employees, purporting to be dated on or before the date of the receipt of
such notice, although presented to, paid or accepted by the Lessor after
that date, all of which shall constitute part of the Obligations. This
Guaranty shall continue to be effective, or shall be reinstated in the
event of any notice of termination, if, at any time, any payment made or
value received with respect to the Obligations is rescinded or must
otherwise be returned by the Lessor to any Lessee, or to any other person
or entity, upon the insolvency, bankruptcy or reorganization of any
Lessee or of any other guarantor of the Obligations, or otherwise, all as
though such payment had not been made or value received.
9. Successors and Assigns. This Guaranty shall be binding upon the Guarantor
and shall inure to the benefit of and be enforceable by the Lessor and its
successors, transferees and assigns. Each reference to the Guarantor in
this Guaranty shall be deemed to include the heirs, executors,
administrators, legal representatives and assigns of the Guarantor, all of
whom shall be bound by the provisions of this Guaranty. Without limiting
the generality of the foregoing sentence, the Lessor may assign or
otherwise transfer any lease agreement with any Lessee, any equipment or
equipment schedule subject thereto, or other agreement held by it
evidencing, securing or otherwise executed in connection with the
Obligations, or sell participations in any interest in such Obligations, to
any other person or entity, and such other person or entity shall thereupon
become vested, to the extent set forth in the agreement evidencing such
assignment, transfer or participation, with all the rights with respect
thereto granted to the Lessor in the Guaranty.
10. Amendments and Waivers. No amendment or waiver of any provision of this
Guaranty nor any consent to any departure by the Guarantor from any
provision of this Guaranty shall be effective unless the same shall be in
writing and signed by the Lessor. No failure on the part of the Lessor to
exercise, and no delay in exercising, any rights hereunder shall operate as
a waiver thereof; nor shall any single or partial exercise of any right
hereunder preclude any other or further exercise thereof or the exercise of
any other right.
11. Notices. All notices and other communications required or permitted under
this Guaranty shall be made in writing and, unless otherwise specifically
provided herein, shall be deemed to have been duly made or given when
delivered by hand or mailed first class mail, postage prepaid, addressed to
the Guarantor, at the address set forth at the end of this Guaranty, or to
the Lessor at its principal place of business as set forth at the beginning
of this Guaranty, or at such address as either party may designate in
writing.
12. Governing Law; Consent to Jurisdiction. This Guaranty is intended to take
effect as a sealed instrument and shall be governed by, and construed in
accordance with, the laws of the Commonwealth of Massachusetts without
giving effect to any conflict of laws provisions thereof. The Guarantor
agrees that any suit for the enforcement of this Guaranty may be brought in
the courts of the Commonwealth of Massachusetts or any Federal Court
sitting therein and consents to the non-exclusive jurisdiction of such
court and to service of process in any such suit being made upon the
Guarantor by mail in the manner specified in Section 12 hereof. The
Guarantor hereby waives any objection that it may now or hereafter have to
the venue of any such suit or any such court or that such suit was brought
in an inconvenient court.
13. Miscellaneous. This Guaranty constitutes the entire agreement of the
Guarantor with respect to the matters set forth herein. The rights and
remedies herein provided are cumulative and not exclusive of any remedies
provided by law or any other agreement, and this Guaranty shall be in
addition to any other guaranty of the Obligations. The invalidity or
unenforceability of any one or more sections of this Guaranty shall not
affect the validity or unenforceability of its remaining provisions.
Captions are for the ease of reference only and shall not affect the
meaning of the relevant provisions. The meanings of all defined terms used
in this Guaranty shall be equally applicable to the singular and plural
forms of the terms defined.
IN WITNESS WHEREOF, the Guarantor has duly executed and delivered this Guaranty
which is intended to take effect as a sealed instrument, as of the day and year
first written above.
AMERICAN SKIING COMPANY, Guarantor
By: /s/ Christopher E. Howard
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