Exhibit 10.95
SUBORDINATION AGREEMENT
SUBORDINATION AGREEMENT (as amended from time to time, "this Agreement"),
made as of the 1st day of August, 1997, among GRAND SUMMIT RESORT PROPERTIES,
INC., a Maine corporation (the "Borrower") and AMERICAN SKIING COMPANY (the
"Subordinated Lender"), and TEXTRON FINANCIAL CORPORATION, a Delaware
corporation, not in its individual capacity but as Administrative Agent (the
"Administrative Agent") for those certain lenders (the "Lenders") under that
certain Loan and Security Agreement, dated as of August 1, 1997, among Borrower,
Lenders and Textron Financial Corporation (as amended from time to time, the
"LSA"),
W I T N E S S E T H :
WHEREAS, pursuant to the LSA and subject to the terms and conditions
thereof, the Lenders have agreed to make a revolving credit facility available
to the Borrower in an aggregate principal amount of up to $55,000,000 (the
"Loan");
WHEREAS, all of the Borrower's indebtedness, liabilities and obligations
to the Lenders, whether now existing or hereafter arising, under the LSA, the
Notes (as defined in the LSA), and all other instruments and documents executed
and delivered in connection therewith are hereinafter referred to collectively
as the "Senior Debt";
WHEREAS, to the extent provided in the LSA, the Senior Debt is or shall be
secured by first security interests and liens on the Borrower's Property now
owned or hereafter acquired, which are and will be evidenced by collateral
assignments and security agreements, all in favor of the Administrative Agent on
behalf of the Lenders (such documents are hereinafter referred to collectively,
together with all other documents now or hereafter creating or granting to the
Lender collateral security for payment of the Senior Debt, as the "Senior
Security Documents");
WHEREAS, all of the indebtedness, liabilities and obligations of the
Borrower to the Subordinated Lender, whether now existing or hereafter arising,
resulting from loans or credit extended to the Borrower from the Subordinated
Lender or otherwise are hereinafter referred to collectively as the
"Subordinated Debt"; and
WHEREAS, these recitals are, and shall be deemed to be, a part of this
Agreement;
NOW THEREFORE, in consideration of the foregoing and of the mutual
undertakings herein contained, the parties hereto hereby agree as follows:
1. Subordination
(a) The payment of any and all of the Subordinated Debt is hereby
expressly made subordinate and junior in right of payment to the payment of the
principal amount of, and all interest and premium on, and all other amounts in
respect of, the Senior Debt, to the extent and in the manner set forth herein.
(b) In the event of (1) any insolvency, bankruptcy, receivership,
liquidation, reorganization, arrangement, assignment for the benefit of
creditors, or other similar proceeding relative to the Borrower, its creditors
or its Property, or (2) any proceeding for the voluntary or involuntary
liquidation, dissolution or other winding up of the Borrower whether or not
involving insolvency or bankruptcy proceedings, then and in any such event:
(i) the principal amount of, and all interest and premium on, and
all other amounts in respect of, the Senior Debt (including interest
thereon accruing after the commencement of any such proceeding) shall be
paid in full before any payment or distribution of any character, whether
in cash, securities or other Property, shall be made in respect of the
Subordinated Debt;
(ii) any payment or distribution of any character, whether in cash,
securities or other Property, which would otherwise (but for the terms
hereof) be payable or deliverable in respect of the Subordinated Debt
(including any payment or distribution in respect of the Subordinated Debt
by reason of any other indebtedness of the Borrower being subordinated to
the Subordinated Debt), shall be paid or delivered directly to the
Administrative Agent on behalf of the Lenders, or its representatives,
until the principal amount of, and all interest and premium on, and all
other amounts in respect of, the Senior Debt shall have been paid in full
and the Subordinated Lender or any other holder of the Subordinated Debt
irrevocably authorizes, empowers and directs all receivers, trustees,
liquidators, conservators and others having authority in the premises to
effect all such payments and deliveries;
(iii) the Subordinated Lender or any other holder of the
Subordinated Debt shall (1) execute and deliver to the Administrative
Agent on behalf of the Lenders or its representative or agent all such
further instruments confirming the authorization referred to in the
foregoing clause (ii) above, (2) execute and deliver to the Administrative
Agent on behalf of the Lenders or its representative or agent any powers
of attorney specifically confirming the rights of the Administrative Agent
(or such representative or agent) arising hereunder, (3) execute and
deliver to the Administrative Agent on behalf of the Lenders or its
representative or agent all proofs of claim, assignments of claim and
other instruments as may be requested by the Administrative Agent or any
Lender to enforce all claims upon or in respect of the Subordinated Debt,
and (4) shall take all other actions as may be requested by the
Administrative Agent or any Lender to enforce all claims upon or in
respect of the Subordinated Debt.
(c) Until and unless the principal amount of, and all interest and premium
on, and all other amounts in respect of, the Senior Debt shall have been paid in
full, the Borrower shall not make, and the Subordinated Lender shall not
receive, accept or retain, any payments of principal or interest or other amount
on account of the Subordinated Debt; provided, however, that the Borrower may
make and the Subordinated Lender may receive, accept and retain such payments so
long as no Default or Event of Default under, and as defined, in the LSA shall
have occurred and be continuing and so long as the Borrower would not be
rendered insolvent, made unable to pay its debts as they come due or be left
without adequate capital to pursue its business after giving effect to such
payment.
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(d) The Borrower agrees that, in the event that any note or other
obligation of the Borrower not evidencing Senior Debt, or any portion thereof,
shall become due and payable before its expressed maturity for any reason, the
Borrower will give prompt notice, in writing, of such happening to the
Administrative Agent.
(e) So long as any of the Senior Debt shall remain unpaid, the
Administrative Agent and the Lenders may at all times exercise any and all
powers and rights which they now have or may hereafter acquire under, or with
respect to any of the collateral subject to, the Senior Security Documents
without having to obtain any consent or approval of the Subordinated Lender and
without any accountability to the Subordinated Lender, nor shall it have any
liability to the Subordinated Lender for any action taken or failure to act with
respect to any of such powers, rights or collateral.
(f) Until the entire principal amount of, and all interest and premium on,
and all other amounts in respect of, the Senior Debt shall have been finally and
indefeasibly paid in full, the Subordinated Lender shall not enforce any right
or remedy (other than requiring payments in the absence of an Event of Default)
or cause the Subordinated Debt to be accelerated or otherwise to become due
prior to its expressed maturity, which it now has or may hereafter have against
the Borrower or its Property, including without limitation, rights and remedies
under any mortgage, deed of trust or security agreement.
(g) If, notwithstanding the provisions of this Agreement, any payment or
distribution of any character (whether in cash, securities or other Property) or
any security shall be received by the Subordinated Lender in contravention of
the terms of this Agreement, and before the entire principal amount of, and all
interest and premium on, and all other amounts in respect of, the Senior Debt
shall have been finally and indefeasibly paid in full, such payment,
distribution or security shall not be commingled with any asset of the
Subordinated Lender, but shall be held in trust for the benefit of, and shall be
paid over or delivered and transferred to, the Administrative Agent, or its
representatives or agents, for application to the payment of all Senior Debt
remaining unpaid, until the principal amount of, and all interest and premium
(including interest thereon accruing after the commencement of any proceedings
described in Section 1(b) hereof) on, and all other amounts in respect of, the
Senior Debt shall have been finally and indefeasibly paid in full.
(h) Until the principal amount of, and all interest and premium on, and
all other amounts in respect of, the Senior Debt shall have been finally and
indefeasibly paid in full, the Subordinated Lender shall have no right of
subrogation, reimbursement or indemnity whatsoever and no right of recourse to
or with respect to any assets or Property of the Borrower or to any collateral
for the Senior Debt.
(i) This Agreement, without further reference, shall pass to and may be
relied on and enforced by any transferee or subsequent holder of the Senior
Debt. In the event of any sale, assignment, disposition or other transfer of the
Subordinated Debt, the Subordinated Lender shall cause the transferee thereof to
execute and deliver to the Administrative Agent a written instrument signed by
the transferee, in form and substance satisfactory to the Administrative Agent,
providing for the continued subordination of the Subordinated Debt to the Senior
Debt as provided for herein and for the continued effectiveness of all of the
rights of the Administrative Agent and the Lenders arising under this Agreement.
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2. Continued Effectiveness of This Agreement.
The terms of this Agreement, the subordination effected hereby, and the
rights of the Administrative Agent and the Lenders and the obligations of the
Subordinated Lender arising hereunder, shall not be affected, modified or
impaired in any manner or to any extent by: (i) any amendment or modification of
or supplement to the LSA, the Notes, the other Senior Security Documents or any
instrument or document executed or delivered pursuant thereto, including,
without limitation, the extension of the term of the Senior Debt and/or the
increase in the amount of the Senior Debt; (ii) the lack of validity, legality
or enforceability of any of such documents; (iii) any exercise or non-exercise
of any right, power or remedy under or in respect of the Senior Debt or any of
such instruments or documents referred to in clause (i) above or arising at law;
or (iv) any waiver, consent, release, indulgence, extension, renewal,
modification, delay or other action, inaction or omission in respect of the
Senior Debt or any of the instruments or documents referred to in clause (i)
above or in respect of any of the properties or assets now or hereafter affected
by any of the Senior Security Documents, whether or not the Subordinated Lender
shall have had notice or knowledge of any of the foregoing and whether or not it
shall have consented thereto.
3. Delivery of Promissory Note.
In order to more fully implement the subordination effected hereby, the
Subordinated Lender shall deliver to the Administrative Agent or its agent all
promissory notes of the Borrower payable to the order of Subordinated Lender.
The Subordinated Lender agrees to take such other action as may be reasonably
necessary or appropriate to effectuate, as between the Administrative Agent and
the Lenders, on the one side, and the Subordinated Lender, on the other side,
the subordination provided for herein.
4. Miscellaneous.
(a) The Subordinated Lender shall join with the Administrative Agent in
executing one or more financing statements pursuant to the Uniform Commercial
Code or other notices appropriate under applicable law, in form satisfactory to
the Lender, for filing in all public offices where such filings are deemed by
the Administrative Agent to be necessary or desirable.
(b) All communications under this Agreement shall be in writing, shall be
deemed given (1) when personally delivered at the following address, (2) one (1)
Business Day after being deposited with a nationally recognized overnight
courier, all delivery fees prepaid, and addressed as follows, (3) or five (5)
Business Days after being deposited in the United States mail (first class,
registered or certified mail), postage prepaid, and addressed as follows:
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(1) if to the Lenders, to:
Textron Financial Corporation
Resort Receivables Finance Division
000 Xxxx Xxxxx Xxxxx, Xxxxx 000
Xxxx Xxxxxxxx, XX 00000
Attention: Xx. Xxxxxxx Xxxxxxxxxx
with a copy to:
Textron Financial Corporation
X.X. Xxx 0000
Xxxxxxxxxx, Xxxxx Xxxxxx 00000-0000
Attn: Vice President - Law
Green Tree Financial Servicing Corporation
000 Xxxxx Xxxxx Xxxxxx, Xxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
Attn: Xxxxxxxxxxx Xxxxxxx
Vice President
(2) if to the Borrower, to:
Grand Summit Resort Properties, Inc.
X.X. Xxx 000
Xxxxxx Xxxxx Xxxx
Xxxxxx, Xxxxx 00000
(3) if to the Subordinated Lender, to:
American Skiing Company
X.X. Xxx 000
Xxxxxx Xxxxx Xxxx
Xxxxxx, Xxxxx 00000
or to such other address as any of the parties shall have furnished in writing
to the other parties. Any notice so addressed and otherwise delivered shall be
deemed to be given when actually received by the addressee.
(c) This Agreement may not be amended or modified orally but may be
amended or modified only in a writing, signed by all parties hereto. No waiver
of any term or provision of this Agreement shall be effective unless it is in
writing, making specific reference to this Agreement and signed by the party
against whom such waiver is sought to be enforced. This
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Agreement constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof. This Agreement shall be binding upon the
parties hereto and their respective heirs, legal representatives, successors and
assigns. This Agreement shall be governed by and construed in accordance with
the laws of the State of Maine.
(d) Terms used in this Agreement and not defined herein shall have the
respective meanings ascribed to them in the LSA.
(e) This Agreement shall terminate upon the final and indefeasible payment
in full of the principal amount of, and all interest and premium on, and all
other amounts in respect of, the Senior Debt.
(f) Two or more duplicate originals of this Agreement may be signed by the
parties hereto, each of which shall be an original, but all of which together
shall constitute one and the same agreement.
(g) All right, powers and remedies hereunder of the Administrative Agent
and the Lenders are cumulative and in addition to any rights, power or remedies
that it may have in respect of any subordination agreement executed and
delivered by the Subordinated Lender in respect of the LSA.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
GRAND SUMMIT RESORT PROPERTIES, INC.
By /s/ Xxxx X. Xxxxxx
--------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
TEXTRON FINANCIAL CORPORATION,
as Administrative Agent
By
--------------------------------------
Name:
Title:
AMERICAN SKIING COMPANY
By /s/ Xxxxxxxxxxx X. Xxxxxx
--------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxx
Title: Chief Administrative Officer
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
GRAND SUMMIT RESORT PROPERTIES, INC.
By
--------------------------------------
Name:
Title:
TEXTRON FINANCIAL CORPORATION,
as Administrative Agent
By /s/ Xxxxx X. Xxxxx
--------------------------------------
Name: Xxxxx X. Xxxxx
Title: Assistant Vice President
AMERICAN SKIING COMPANY
By
--------------------------------------
Name:
Title:
AGREED AND CONSENTED TO:
TEXTRON FINANCIAL CORPORATION, as a Lender
By /s/ Xxxxx X. Xxxxx
---------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Assistant Vice President
GREEN TREE FINANCIAL SERVICING CORPORATION, as a Lender
By
---------------------------------------------
Name:
Title:
AGREED AND CONSENTED TO:
TEXTRON FINANCIAL CORPORATION, as a Lender
By
---------------------------------------------
Name:
Title:
GREEN TREE FINANCIAL SERVICING CORPORATION, as a Lender
By /s/ Xxxxxxxxxxx X. Xxxxxxx
---------------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxx
Title: V.P., GENERAL MANAGER
