EXHIBIT 10.106
XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES CORPORATION
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
CONSENT SOLICITATION ADVISORY AGREEMENT
October 7, 1997
PRIVATE AND CONFIDENTIAL
American Skiing Company
Sunday Xxxxx Xxxxxx Xxxx
Xxxxxx, Xxxxx 00000
Attention: Xxxxxxxxxxx X. Xxxxxx, Esq.
Ladies and Gentlemen:
The Company (as defined) hereby retains Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation ("DLJ") to render financial advisory services to the
Company on the terms and subject to the conditions set forth herein in
connection with the proposed solicitation (the "Consent Solicitation") of
consents, waivers or authorizations ("Consents") from holders ("Holders") of 12%
Senior Subordinated Notes due 2006 (the "Securities") of ASC East ("ASC East")
to a proposed amendment (the "Proposed Amendment") to the indenture (the
"Indenture") relating to the Securities. The documents and related information
provided to Holders by the Company relating to the Consent Solicitation
(including the Proposed Amendment), and each amendment or supplement thereto,
are hereinafter collectively referred to as the "Consent Solicitation
Documents."
1. RETENTION. The Company hereby retains DLJ, and DLJ agrees to
act, as sole financial advisor and solicitation agent to the Company, in
connection with the Consent Solicitation and the other matters referred to
herein. DLJ will:
(a) advise the Company with respect to the terms and timing of the Consent
Solicitation;
(b) assist the Company in preparing the required Consent Solicitation
Documents (to the extent such documents relate to the terms of the Consent
Solicitation);
(c) advise the officers and employees of the Company with regard to the
procedures to be used in connection with the Consent Solicitation; and
(d) use its reasonable best efforts to assist the Company in soliciting
Consents to the Proposed Amendment from the Holders.
In connection with any solicitations of Consents from Holders, DLJ will
solicit such Consents only pursuant to the Consent Solicitation Documents and
will not make any statement or representation
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regarding the Company or the Proposed Amendment that is not set forth in the
Consent Solicitation Documents.
2. COMPENSATION. In consideration of the obligations of DLJ as exclusive
financial advisor and solicitation agent hereunder, the character and
sufficiency of which the Company hereby acknowledges, the Company agrees to pay
DLJ a cash fee equal to .25% of the aggregate principal amount of the Securities
whose Holders Consent to the Proposed Amendment to the Indenture (the
"Solicitation Fee"). The Solicitation Fee shall be payable in cash upon
execution and delivery by the trustee under the Indenture (the "Trustee") of a
supplemental indenture (the "Supplemental Indenture") evidencing the Proposed
Amendment. In addition, the Company agrees to pay to DLJ, promptly as billed,
all reasonable out-of-pocket expenses incurred by DLJ in connection with the
performance of its services hereunder including, without limitation, all
reasonable fees and expenses of counsel to DLJ in connection with the
transactions contemplated hereby.
3. USE OF NAME. The Company agrees that any reference to DLJ in any
Consent Solicitation Document or any other release or communication, is subject
to DLJ's prior written approval. If DLJ resigns prior to the dissemination of
any Consent Solicitation Document or any other release or communication, no
reference shall be made therein to DLJ.
4. CONFIDENTIALITY. Any financial advice rendered by DLJ pursuant to
this Agreement (as defined) may not be disclosed publicly (unless required by
law) in any manner without DLJ's prior written approval and will be treated as
confidential. The Company will provide DLJ with all financial and other
information reasonably requested by DLJ for the purpose of rendering its
services pursuant to this Agreement. All non-public information given to DLJ by
the Company will be treated by DLJ as confidential (except as required by law).
DLJ may rely, without independent verification, on the accuracy and completeness
of all information furnished to DLJ by the Company, including the Consent
Solicitation Documents. This Agreement and its contents will be treated by the
Company as confidential (except as required by law).
5. INDEMNIFICATION. The Company agrees to the indemnification and other
obligations set forth in Schedule I attached hereto which Schedule I is
incorporated in this letter agreement and made a part hereof. All references
herein to the "Agreement" shall be to this letter agreement together with
Schedule I attached hereto.
6. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents
and warrants to DLJ that at the commencement, and throughout the continuance, of
the Consent Solicitation:
(a) None of the Consent Solicitation Documents will contain any untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements made therein, in light of the circumstances under which
they were made, not misleading.
(b) Each of the Consent Solicitation Documents will comply in all material
respects with all applicable laws and any applicable rules and regulations of
the Securities and Exchange Commission, and of any other governmental or
regulatory authority or body, including applicable "blue sky" or similar
securities laws or statutes, and no consent or approval of, or filing with, any
governmental or regulatory authority or body (including, without limitation,
under the Securities Act of 1933, as amended, the Securities Exchange Act of
1934,
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as amended, or the Trust Indenture Act of 1939, as amended (the "TIA")) is
required in connection with the commencement or consummation of the Consent
Solicitation other than those consents or approvals that have been made prior
to, or within the permitted filing period following, the commencement or
consummation, as the case may be, of the Consent Solicitation.
(c) The Supplemental Indenture evidencing the Proposed Amendment will,
prior to its execution, have been duly authorized by ASC East and consented to
by the Holders of not less than a majority in principal amount of the Securities
outstanding pursuant to the provisions of the Indenture, and, upon execution and
delivery thereof by ASC East and the Trustee at the consummation of the Consent
Solicitation, such Indenture, as amended by the Supplemental Indenture, and the
Securities (as so amended) will be the legal, valid and binding obligations of
ASC East, enforceable against ASC East in accordance with their respective
terms.
(d) The Consents, the Consent Solicitation and the Supplemental Indenture
will comply with the Indenture and, upon execution and delivery of the
Supplemental Indenture by ASC East and the Trustee, the Indenture (as modified
by the Proposed Amendment) will comply in all material respects with the TIA.
(e) The Proposed Amendment will conform in all material respects to the
description thereof in the Consent Solicitation Documents.
(f) The Consent Solicitation will not, and the execution of the
Supplemental Indenture at the time of such execution and the consummation of all
other transactions contemplated by the Consent Solicitation Documents at the
time of such consummation will not, (i) result in a violation of any provision
of the charter or bylaws of the Company or (ii) result in a breach of any of the
terms or provisions of, or constitute a default or cause an acceleration of any
obligation under, any bond, note, debenture or other evidence of indebtedness,
or any indenture, mortgage, deed of trust or other agreement or instrument to
which the Company is a party or by which the Company or any of its properties
is bound, which breaches, defaults or accelerations, individually or in the
aggregate, would have a material adverse effect on the Company or violate any
statute, or any rule, regulation or order of any court or governmental agency or
authority entered in any proceeding to which the Company is a party or by which
the Company or any of its properties is bound.
(g) This Agreement has been duly authorized and validly executed and
delivered by American Skiing Company and ASC East and constitutes a legal, valid
and binding agreement of American Skiing Company and ASC East, enforceable
against American Skiing Company and ASC East in accordance with its terms.
7. OPINION OF COUNSEL. As promptly as practicable after first mailing of
any Consent Solicitation Document to any Holder, and in no event later than the
time of execution of the Supplemental Indenture, counsel to the Company shall
deliver to DLJ an opinion or opinions reasonably satisfactory to DLJ and its
counsel substantially to the effect that (a) this Agreement has been duly
authorized, executed and delivered by American Skiing Company and ASC East and
constitutes a legal, valid and binding agreement of American Skiing Company and
ASC East, enforceable against American Skiing Company and ASC East in accordance
with its terms (subject to usual and customary qualifications); (b) the
consummation of the Consent Solicitation and the execution of the Supplemental
Indenture on
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the part of ASC East will not violate federal or state securities laws or any
rules and regulations of the Securities and Exchange Commission applicable to
the Company; (c) no consent or approval of, or filing with, any federal
governmental or regulatory authority or body is required on the part of the
Company in connection with the Consent Solicitation, other than those consents
or approvals that have been obtained or any filings that have been made prior to
commencement of the Consent Solicitation; (d) the consummation of the
transactions contemplated by the Consent Solicitation Documents will not result
in a violation of any provision of the charter or bylaws of the Company, or, to
the best of such counsel's knowledge, any statute or any rule, regulation or
order of any court or governmental agency or authority entered in any proceeding
to which the Company was or is a party or by which the Company is bound or
result in a breach of any of the terms or provisions of, or constitute a default
or cause an acceleration of any obligation under any material bond, note,
debenture or other evidence of indebtedness, or any indenture, mortgage, deed of
trust or other agreement or instrument to which the Company is a party or by
which the Company or any of its properties is bound; (e) the Supplemental
Indenture has been duly authorized by ASC East and, when executed and delivered
by ASC East as contemplated by the Consent Solicitation Documents, will
constitute the legal, valid and binding obligation of ASC East, enforceable
against it in accordance with its terms (subject to usual and customary
qualifications); and (f) the Indenture, as modified by the Proposed Amendment,
will comply as to form with all requirements of the TIA.
8. SURVIVAL OF CERTAIN PROVISIONS. The agreements contained in Sections
3, 4 and 5 of this Agreement, the provisions of this Agreement relating to the
payment of fees and expenses in Section 2 and Section 15, the representations
and warranties of the Company contained in Section 6 of this Agreement and the
indemnification and other obligations set forth in Schedule I of this Agreement
shall remain operative and in full force and effect regardless of (a) any
investigation made by or on behalf of DLJ, or by or on behalf of any other
Indemnified Person (as defined), (b) consummation of the Consent Solicitation or
(c) any termination of this Agreement, and shall be binding upon, and shall
inure to the benefit of, any successors, heirs and personal representatives of
the Company, DLJ, the other Indemnified Persons and any such successors, heirs
and personal representatives.
9. CONSTRUCTION AND JURISDICTION. This Agreement incorporates the entire
understanding of the parties and (except as otherwise provided herein)
supersedes all previous agreements, and shall be governed by, and construed in
accordance with, the laws of the State of New York as applied to contracts made
and performed in such State without regard to principles of conflicts of laws.
The Company and DLJ each irrevocably and unconditionally submits to the
jurisdiction of any State or Federal court sitting in New York City over any
suit, action or proceeding arising out of or relating to this Agreement. The
Company and DLJ each hereby agrees that service of any process, summons, notice
or document by U.S. registered mail addressed to the Company shall be effective
service of process for any action, suit or proceeding brought in any such court.
The Company and DLJ each irrevocably and unconditionally waives any objection to
the laying of venue of any such suit, action or proceeding brought in any such
court and any claim that any such suit, action or proceeding brought in such a
court has been brought in an inconvenient forum. The Company and DLJ each
agrees that a final judgment in any such suit, action or proceeding brought in
any such court shall be conclusive and binding upon it and may be enforced in
any other courts to whose jurisdiction it is or may be subject by suit upon such
judgment.
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10. SEVERABILITY. If any term, provision, covenant or restriction
contained in this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void, unenforceable or against its regulatory
policy, the remainder of the terms, provisions, covenants and restrictions
contained in this Agreement shall remain in full force and effect and shall in
no way be affected, impaired or invalidated.
11. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original,
and such counterparts shall together constitute one and the same instrument.
12. AMENDMENT AND ASSIGNMENT. Amendments or modifications to this
Agreement shall be made only in writing, duly executed by American Skiing
Company, ASC East and DLJ. None of American Skiing Company, ASC East and DLJ
shall have the right to assign any of its rights under this Agreement and any
such assignment shall be null and void.
13. HEADINGS. The section headings in this Agreement have been inserted
as a matter of convenience or reference and are not part of this Agreement.
14. THIRD PARTY BENEFICIARIES. This Agreement has been made solely for
and shall be binding upon and inure only to the benefit of American Skiing
Company, ASC East, DLJ and the Indemnified Persons and their respective
successors and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement.
15. TERMINATION. This Agreement may be terminated by the Company or by
DLJ at any time without liability or continuing obligations on the part of
either party, other than as set forth in Section 8; PROVIDED, HOWEVER, that,
unless this Agreement shall have been terminated by DLJ, the Company shall be
obligated to pay DLJ the fees provided in Section 2 hereof if the Trustee
executes and delivers the Supplemental Indenture at any time during the period
commencing on the date hereof and ending on the date that is 12 months following
the date of termination of this Agreement.
Please note that DLJ is a full service securities firm engaged in
securities trading and brokerage activities, as well as providing investment
banking and financial advisory services. In the ordinary course of DLJ's
trading and brokerage activities, DLJ or its affiliates may at any time hold
long or short positions, and may trade or otherwise effect transactions, for its
own account or on the accounts of customers, in debt or equity securities of the
Company or other entities that may be involved in the transactions contemplated
hereby. We recognize our responsibility for compliance with Federal laws in
connection with any such activities.
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Please confirm that the foregoing terms correctly set forth our agreement
by signing and returning to DLJ the duplicate copy of this Agreement enclosed
herewith. Thereupon this Agreement shall constitute our binding agreement on
the subject matter herein.
Sincerely yours,
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
By: /s/ Xxxxxx XxXxxxxxx
------------------------------------
Name: Xxxxxx XxXxxxxxx
Title: Managing Director
Confirmed and Agreed to as of
October 7, 1997.
AMERICAN SKIING COMPANY
By: /s/ Xxxxxxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxx
Title: Chief Administrative Officer
ASC EAST
By:
------------------------------------
Name:
Title:
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SCHEDULE 1
This Schedule I is a part of and is incorporated into that certain letter
agreement (which letter agreement is collectively referred to herein with this
Schedule I as the "Agreement"), dated October 7, 1997 by and among American
Skiing Company and ASC East (which together with their subsidiaries and
affiliates are hereinafter referred to collectively as the "Company") and DLJ.
The Company agrees to indemnify and hold harmless DLJ, its affiliates and
its parent and its affiliates, and the respective directors, officers, agents
and employees of DLJ, its affiliates and its parent and its affiliates (DLJ and
each such entity or person, an "Indemnified Person") from and against any
losses, claims, damages, judgments, assessments, costs and other liabilities
(collectively, "Liabilities"), and will reimburse each Indemnified Person for
all fees and expenses (including the reasonable fees and expenses of counsel)
(collectively, "Expenses") as they are incurred in investigating, preparing,
pursuing or defending any claim, action, proceeding or investigation, whether or
not in connection with pending or threatened litigation or arbitration and
whether or not any Indemnified Person is a party (collectively, "Actions"), (i)
caused by, or arising out of or in connection with, any untrue statement or
alleged untrue statement of a material fact contained in the Consent
Solicitation Documents or by any omission or alleged omission to state therein a
material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading (other than untrue
statements or alleged untrue statements in, or omissions or alleged omissions
from, information relating to an Indemnified Person furnished in writing by or
on behalf of such Indemnified Person expressly for use in the Consent
Solicitation Documents) or (ii) otherwise arising out of or in connection with
advice or services rendered or to be rendered by any Indemnified Person pursuant
to this Agreement, the transactions contemplated hereby or any Indemnified
Person's actions or inactions in connection with any such advice, services or
transactions; provided that, in the case of clause (ii) only, the Company will
not be responsible for any Liabilities or Expenses of any Indemnified Person
that are determined by a judgment of a court of competent jurisdiction which is
no longer subject to appeal or further review to have resulted solely from any
Indemnified Person's gross negligence or willful misconduct in connection with
any of the advice, actions, inactions or services referred to above. The
Company also agrees to reimburse each Indemnified Person for all Expenses as
they are incurred in connection with enforcing such Indemnified Person's rights
under this Agreement. In the event that it is determined in accordance with
the foregoing sentence that an Indemnified Person is not entitled to indemnity
hereunder, DLJ shall promptly reimburse or shall cause such Indemnified Person
to reimburse the Company for all amounts paid to or on behalf of any Indemnified
Person under this Agreement.
Upon receipt by an Indemnified Person of actual notice of an Action against
such Indemnified Person with respect to which indemnity may be sought under this
Agreement, such Indemnified Person shall promptly notify the Company in writing;
provided that failure to so notify the Company shall not relieve the Company
from any liability which the Company may have on account of this indemnity or
otherwise, except to the extent that the Company shall have been prejudiced by
such failure. The Company shall have the right to assume the defense of any
such Action including the employment of counsel reasonably satisfactory to DLJ.
Any Indemnified Person shall have the right to employ separate counsel in any
such Action and participate in the defense thereof, but the fees and expenses of
such counsel shall be at the expense of such Indemnified Person, unless: (i)
the Company has failed promptly to
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assume the defense and employ counsel or (ii) the named parties to any such
Action (including any impleaded parties) include such Indemnified Person and the
Company, and such Indemnified Person shall have been advised by counsel that
there may be one or more legal defenses available to it which are different from
or in addition to those available to the Company; provided that the Company
shall not in such event be responsible hereunder for the fees and expenses of
more than one firm of separate counsel in connection with any Action in the same
jurisdiction in addition to any local counsel. The Company shall not be liable
for any settlement of any Action affected without its written consent (which
shall not be unreasonably withheld). In addition, the Company shall not,
without prior written consent of DLJ, settle, compromise or consent to the entry
of any judgment in or otherwise seek to terminate any pending or threatened
Action in respect of which indemnification or contribution may be sought
hereunder (whether or not any Indemnified Person is a party thereto) unless such
settlement, compromise, consent or termination includes an unconditional release
of each Indemnified Person from all Liabilities arising out of such Action.
In the event that the foregoing indemnity is unavailable to an Indemnified
Person other than due to the gross negligence or willful misconduct of any
Indemnified Person, the Company shall contribute to the Liabilities and Expenses
paid or payable by such Indemnified Person in such proportion as is appropriate
to reflect (i) the relative benefits to the Company and its shareholders, on the
one hand, and to DLJ, on the other hand, of the matters contemplated by this
Agreement or (ii) if the allocation provided by the immediately preceding clause
is not permitted by applicable law, not only such relative benefits but also the
relative fault of the Company, on the one hand, and DLJ, on the other hand, in
connection with the matters as to which such Liabilities or Expenses relate, as
well as any other relevant equitable considerations; provided that in no event
shall the Company contribute less than the amount necessary to ensure that all
Indemnified Persons, in the aggregate, are not liable for any Liabilities and
Expenses in excess of the amount of fees actually received by DLJ pursuant to
this Agreement. For purposes of this paragraph, the relative benefits to the
Company and its shareholders, on the one hand, and to DLJ, on the other hand, of
the matters contemplated by this Agreement shall be deemed to be in the same
proportion as (i) the total value paid or contemplated to be paid or received or
contemplated to be received by the Company or the Company's shareholders, as the
case may be, in the transaction or transactions that are within the scope of
this Agreement, whether or not any such transaction is consummated, bears to
(ii) the fees paid to DLJ under this Agreement.
The Company also agrees that no Indemnified Person shall have any liability
(whether direct or indirect, in contract or tort or otherwise) to the Company
for or in connection with advice or services rendered or to be rendered by any
Indemnified Person pursuant to this Agreement, the transactions contemplated
hereby or any Indemnified Person's actions or inactions in connection with any
such advice, services or transactions except for Liabilities (and related
Expenses) of the Company that are determined by a judgment of a court of
competent jurisdiction which is no longer subject to appeal or further review to
have resulted solely from (i) any Indemnified Person's gross negligence or
willful misconduct in connection with any such advice, actions, inactions or
services, or (ii) the material breach by DLJ of an express provision of this
Agreement which was not cured by DLJ within 10 business days of DLJ having
received written notice of such breach from the Company.
The reimbursement, indemnity and contribution obligations of the Company
set forth herein shall apply to any modification of this Agreement and shall
remain in full force and
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effect regardless of any termination of, or the completion of any Indemnified
Person's services under or in connection with, this Agreement.
