Exhibit 99.2
FULL RELEASE AND SETTLEMENT AGREEMENT
The parties to this Agreement are Triple Peaks LLC and Steamboat LLC
(collectively, "Triple Peaks") and American Skiing Company ("ASC"), Steamboat
Ski and Resort Corporation, Walton Pond Apartments, Inc., and American Skiing
Company Resort Properties, Inc. (collectively with ASC, "American Skiing").
Triple Peaks and ASC entered into a Stock Purchase and Merger Agreement
("the Agreement") on January 24, 2002. The following litigation (hereinafter
"the Litigation") was instituted by the parties concerning that Agreement:
1. Triple Peaks LLC, et al. v. American Skiing Company, et al., Civil
Action No. 2002CV85, District Court, Routt County, Colorado, and the appeal(s)
therefrom, including ASC's pending petition for writ of certiorari to the
Colorado Supreme Court (Case No. 04SC195) from the Colorado Court of Appeals
(Case No. 03CA0222);
2. Triple Peaks LLC v. American Skiing Company, et al., Civil Action
Xx. 00-X-0000, Xxxxxx Xxxxxx Xxxxxxxx Xxxxx, Xxxxxxxx of Colorado;
3. American Skiing Company v. Triple Peaks LLC, Civil Action Xx.
00-X-0000, Xxxxxx Xxxxxx Xxxxxxxx Xxxxx, Xxxxxxxx of Colorado.
By this Full Release and Settlement Agreement (the "Release"), for the
consideration set forth below, the parties hereto release and discharge each
other from any and all claims, actions, liabilities, causes of action, damages,
remedies, specific performance, and penalties of any kind or nature, whether now
known or unknown, suspected or unsuspected, that now exist, may have existed, or
may exist in the future arising out of or in any way connected with the
Agreement or the Litigation, including, but not limited to, all claims that are
alleged or which could have been alleged in the Litigation or any other matters
arising out of or related to the Agreement (hereinafter collectively referred to
as the "Released Claims"). Upon execution of this agreement, ASC further agrees
to immediately dismiss with prejudice its pending petition for writ of
certiorari to the Colorado Supreme Court (Case No. 04SC195).
Triple Peaks and ASC agree that the Agreement is terminated by
agreement of the parties, and the Agreement shall have no further force and
effect of any kind whatsoever. Further, no party is entitled to recover damages
or remedies of any kind, including specific performance, pursuant to the
Agreement.
The parties warrant and represent that they are the owners of each and
every Released Claim, and that they have the right, ability, authority, and
power to release them, and to execute this Release and Stipulation for
Dismissal, with Prejudice, and to consummate the transactions contemplated
hereby.
The parties warrant and represent that this Release has been duly
executed and delivered by each of the parties as a duly authorized, valid,
legally binding and enforceable obligation of such party.
The parties warrant and represent that the execution, delivery and
performance of this Release and the consummation of the transactions
contemplated hereby will not conflict with, or result in any violation or breach
of or default under the certificate of incorporation, articles of organization,
articles of incorporation, bylaws or other constitutive documents of such party
nor under any note, license, instrument, indenture, mortgage, deed of trust or
other agreement or understanding or any other restriction of any kind or
character, to which such party or any of its assets or properties is subject or
bound.
ASC warrants and represents to Triple Peaks that obligations of ASC to
make any payments set forth herein are pari passu with the obligations of ASC
under its $120,000,000 Senior Subordinated Notes due 2006.
ASC further warrants and represents to Triple Peaks that it has
obtained all necessary consents and approvals to the terms of this Release and
to consummate the transactions contemplated hereby, including but not limited to
any necessary approvals and consents from its senior lenders.
Neither party admits liability to the other for any Released Claim, and
this Release shall never be treated as an admission of liability or
responsibility of any party for any purpose.
The parties represent and warrant that they have not assigned any cause
of action in any way related to any Released Claim, and they agree to indemnify
and hold the other harmless from any costs, including attorney's fees or damages
of any kind or nature incurred by the other in defending against any person or
entity claiming to be an assignee of any cause of action related to the
Litigation or the Agreement.
This Release shall be binding upon and inures to the benefit of the
parties and their respective successors, assigns, administrators, trustees,
employees, officers, directors, managing agents, subsidiaries, affiliates and
shareholders.
The parties and their attorneys agree that they will not disparage the
other party to this Release, nor shall they communicate with the media about
this Release other than to confirm in a mutually acceptable joint press release
that the matter has been resolved in a matter satisfactory to both parties, and
that ownership of Steamboat Springs ski area will remain with ASC.
Notwithstanding the foregoing ASC may make such public disclosure of the terms
of this Release as its counsel reasonably deems necessary in order to meet its
obligations as a publicly traded corporation.
The parties agree and acknowledge that this Release constitutes the
final and complete agreement between the parties regarding the subject matter
hereof, and that each party acknowledges that no other party, nor any agent or
attorney for such party, has made any promises, representations or warranties
whatsoever, whether express or implied, which are not contained or referred to
herein. The terms of this Release cannot be modified or amended in any way
unless such modification or amendment is documented in writing, signed by each
party. Furthermore, the parties acknowledge that written or oral communications,
including any documents containing proposed terms of settlement have no force or
effect whatsoever.
In the event that any term, condition, or covenant contained within
this Release is held to be invalid, any such invalidity shall not affect the
validity and enforceability of any other term, condition, or warranty contained
herein, which shall remain in full force and effect.
The parties agree that each party shall bear its own costs, expenses, and
attorney's fees relating to the Agreement, the Litigation, and this Release.
The provisions of this Release shall not be construed or interpreted
for or against any party because said parties' attorneys drafted the Agreement
or any part thereof.
This Release shall be interpreted in accordance with and governed by
the laws of the state of Colorado, and shall be given full faith and credit in
all other jurisdictions.
Any and all notices or delivery of funds to Triple Peaks shall be made
by facsimile and delivery service addressed to Xxx Xxxxxxx, Triple Peaks, LLC,
00 Xxxxx Xxxxx Xxxx, Xxxxxx, XX, 00000, Fax: 802-###-####, with a copy to Xxxxx
X. Lyons, Rothberger, Xxxxxxx & Xxxxx, LLC, 0000 Xxxxxxxxxxx Xxxxxx, Xxxxx 0000,
Xxxxxx, XX 00000, Fax: 000-000-0000. All notices from Triple Peaks to ASC shall
be made by facsimile and delivery service addressed to Xxxxxx X. Xxxxxxx, Xx.,
American Skiing Company, Xxx Xxxxxxxx Xxx, Xxxxxxxx, XX 00000, Fax 000-000-0000,
with a copy to X. X. Fair, American Skiing Company, 000 Xxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxx, Xxxx 00000, fax 000-000-0000 and Xxxx X. Wells, Wells, Xxxxxxxx &
Race, 0000 Xxxxxxxx, Xxxxx 0000, Xxxxxx, XX 00000, Fax: 000-000-0000.
CONSIDERATION
1. ASC will pay Triple Peaks $3,000,000.00 upon execution of this
Release and the Stipulation for Dismissal, with Prejudice, of the Litigation.
2. ASC will agree to pay Triple Peaks an additional $2,140,000 (the
"Additional Payment") on or prior to April 10, 2005. From and after April 10,
2005, any unpaid portion of the Additional Payment will bear simple interest at
12% per annum through December 31, 2005. Any unpaid portion of the Additional
Payment remaining outstanding as of January 1, 2006 (the "Maturity Date") will
be deemed to be in default, for which defaulted amounts Triple Peaks may
exercise its remedies under Paragraph 4 hereof, and will bear simple interest at
16% per annum until the date of payment. All interest will be compounded
annually and will be capitalized with the Additional Payment. The Additional
Payment, together with any accrued interest, may be prepaid in part or in full
by ASC at any time without penalty.
3. Upon execution of this Release and the Stipulation for Dismissal of
the Litigation, Triple Peaks will fully release the Lis Pendens recorded with
the Clerk and Recorder, Routt County, Colorado, reception number 562841.
4. ASC will deliver to Triple Peaks, contemporaneously with the
execution of this Release and the Stipulation for Dismissal of the Litigation, a
stipulated confession of judgment in the form attached hereto as Exhibit A, in
the amount of any unpaid amount of the Additional Payment, including accrued
interest, if any. The confession of judgment shall be held in escrow by Triple
Peaks, and shall be substituted with a new confession of judgment upon payment
of any portion of the Additional Payment, with such replacement confession of
judgment reflecting the fact of payments made by ASC. Upon substitution of the
confession of judgment as aforesaid, the previous confession of judgment shall
be returned to ASC.
The confession of judgment will provide that it may be entered in any
court of competent jurisdiction in which ASC has assets or is qualified to do
business only upon 48 hours prior written notice to ASC and only upon the
occurrence of one or more of the following events (each a "Default Event"):
(a) ASC has not paid in full the Additional Payment, including
accrued interest, if any, on or before the Maturity Date; or
(b) ASC has not paid the Additional Payment, including accrued
interest, if any, and the Bonus Payment (as defined below)
contemporaneously with the consummation of a Triggering Event (as
defined below)
The confession of judgment will provide for immediate entry of judgment
and execution thereon without further notice.
The confession of judgment will also provide that Triple Peaks will be
entitled to an increase in the judgment of up to 20% of the judgment amount as
reimbursement for its reasonable collection costs and attorneys' fees, but only
in the event that 30 days or more has elapsed following a Default Event and
either the Additional Payment (including any accrued interest) or the Bonus
Payment remains unpaid.
The confession of judgment will be returned to ASC upon the payment of
the Additional Payment, and any interest accrued thereon.
5. In the event that ASC enters into a definitive, written agreement to
sell or transfer (directly or indirectly through a subsidiary or affiliate) all
or substantially all of its assets to a third party on or prior to December 31,
2005, and the closing thereof occurs on or before April 1, 2006 (such closing
referred to herein as a "Triggering Event"), ASC will pay Triple Peaks a bonus
payment equal to $860,000 less any interest paid or to be paid on the Additional
Payment (the "Bonus Payment"). The Bonus Payment shall be made simultaneously
with the consummation of the Triggering Event. It is also agreed that any unpaid
Additional Payment and accrued interest thereon shall also be paid in cash
simultaneously with the consummation of the Triggering Event. In the event that
the Triggering Event occurs after December 31, 2004, and the Additional Payment
has been made prior to the date of consummation of the Triggering Event, then
the amount of the Bonus Payment shall be reduced by $250,000.
6. Prior to ASC making an offer or accepting an offer received to sell
or transfer the Steamboat ski resort to a third party, other than (i) a sale
involving one or more additional ski resorts owned or controlled by ASC, (ii) a
transfer of the resort to ASC or one of its subsidiaries, (iii) a transfer via
foreclosure or deed in lieu to ASC's lenders or their assigns or (iv) a transfer
resulting from the exercise by ASC's lenders of their rights under collateral
powers of attorney, ASC shall first provide Triple Peaks with a thirty (30) day
negotiation period regarding the purchase of the resort, which negotiation shall
be exclusive except as to ASC's responses to any unsolicited offers received. If
an agreement between ASC and Triple Peaks is not reached within 30 days of
written notice from ASC regarding the offer for sale, ASC may negotiate with any
other potential purchasers without restriction, and this provision shall have no
further force or effect. The foregoing right of first offer shall expire three
years after the date of this Release. To the extent that the Steamboat ski
resort is transferred to an ASC affiliate or subsidiary, ASC shall also cause
this right of first offer to be transferred and this right of first offer shall
continue as an obligation of ASC and of such affiliate or subsidiary.
The parties acknowledge that they have had advice from counsel of their
choice concerning this Release, and that they enter into it voluntarily and will
full knowledge of its effect and consequences.
Dated this 8th day of July, 2004.
TRIPLE PEAKS LLC
By: /s/Xxxxxxx Xxxxxxx,
-------------------
its managing member
By: /s/Xxxxxxx Xxxxxxx
------------------
Xxxxxxx Xxxxxxx
Its:
STEAMBOAT LLC
By: /s/Xxxxxxx Xxxxxxx,
-------------------
its managing member
By: /s/Xxxxxxx Xxxxxxx
-------------------
Xxxxxxx Xxxxxxx
Its:
AMERICAN SKIING COMPANY
By: /s/Xxxxxx X. Xxxxxxx, Xx.
------------------------------
Xxxxxx X. Xxxxxxx, Xx.
Its:Senior Vice President and
General Counsel
AMERICAN SKIING COMPANY RESORT
PROPERTIES, INC.
By: /s/Xxxxxx X. Xxxxxxx, Xx.
------------------------------
Xxxxxx X. Xxxxxxx, Xx.
Its:Senior Vice President and
General Counsel
STEAMBOAT SKI & RESORT CORPORATION
By: /s/Xxxxxx X. Xxxxxxx, Xx.
------------------------------
Xxxxxx X. Xxxxxxx, Xx.
Its:Senior Vice President and
General Counsel
WALTON POND APARTMENTS, INC.
By: /s/Xxxxxx X. Xxxxxxx, Xx.
------------------------------
Xxxxxx X. Xxxxxxx, Xx.
Its:Senior Vice President and
General Counsel
Approved as to Form and Content:
XXXXX, XXXXXXXX & RACE LLC
/s/Xxxx X. Xxxxx
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Xxxx X. Xxxxx
0000 Xxxxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
000-000-0000
Attorneys for American Skiing
Company
ROTHGERBER, XXXXXXX & XXXXX LLP
/s/Xxxxx X. Xxxxx
-------------------------------------
Xxxxx X. Xxxxx
0000 00xx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
000-000-0000
Attorneys for Triple Peaks LLC