EXHIBIT 10.2
EXECUTION COPY
VOTING AND RECAPITALIZATION AGREEMENT
This VOTING AND RECAPITALIZATION AGREEMENT, dated as of
December 8, 2000 (this "Agreement"), is made and entered into among MeriStar
Hotels & Resorts, Inc., a Delaware corporation ("MeriStar"), American Skiing
Company, a Delaware corporation ("ASC"), Oak Hill Capital Partners, L.P., a
Delaware limited partnership ("OCP"), Oak Hill Capital Management Partners,
L.P., a Delaware limited partnership ("OCMP"), Oak Hill Securities Fund, L.P., a
Delaware limited partnership ("OSF"), Oak Hill Securities Fund II, L.P., a
Delaware limited partnership ("OSF2"), OHCP Ski, L.P., a Delaware limited
partnership ("OSLP"), Xxxxxxxxx LLC, a New York limited liability company
("Xxxxxxxxx"), Xxxxxx X. Xxxxx ("Xxxxx") and the Xxxxxx Xxxxx Trust f/b/o
Xxxxxxx Xxxxx, a trust organized under the laws of New Jersey (the "Trust").
OCP, OCMP, XXX, XXX0, OSLP, Xxxxxxxxx, the Xxxxx and the Trust are referred to
collectively as the "Stockholders" and each as a "Stockholder".
RECITALS:
A. ASC, ASC Merger Sub, Inc., a Delaware corporation ("Merger
Sub"), and MeriStar are, simultaneously with the execution hereof, entering into
an Agreement and Plan of Merger, dated as of the date hereof (the "Merger
Agreement"), pursuant to which Merger Sub will merge with and into MeriStar (the
"Merger") on the terms and subject to the conditions set forth in the Merger
Agreement and, as a result, MeriStar will become a wholly-owned subsidiary of
ASC. Except as otherwise defined herein, capitalized terms used herein without
definition have the respective meanings ascribed to them in the Merger
Agreement.
B. Under the Merger Agreement, it is a condition precedent to
the obligation of MeriStar to complete the Merger that ASC complete the
recapitalization (the "Recapitalization") in which (i) the Class A common stock,
par value $0.01 per share (the "Class A Common Stock"), of ASC and the 8.5%
Series B Convertible Participating Preferred Stock, liquidation value $1,000 per
share (the "Series B Preferred Stock"), of ASC shall have been converted into
common stock, par value $0.01 per share (the "Common Stock"), of ASC, at or
prior to the Effective Time; (ii) the 10.5% Repriced Convertible Exchangeable
Preferred Stock, liquidation value $1,000 per share (the "Series A Preferred
Stock"), of ASC shall have been converted into shares of Series A Preferred
Stock, par value $0.01 per share (the "New Series A Preferred Stock"), of ASC,
having terms substantially as set forth in Exhibit B hereto and shares of Common
Stock, immediately prior to the Effective Time, as herein provided; (iii) the
warrants (the "Warrants") to purchase 6,000,000 shares of Common Stock at an
exercise price of $2.50 per share shall have been issued to OCP in accordance
with the Securities Purchase Agreement (as amended to date, the "Warrant
Purchase Agreement"), dated July 31, 2000, among ASC, ASC Resort Properties,
Inc. ("Resort Properties") and OCP and OCP shall not own any shares of the
capital stock of Resort Properties; and (iv) the Resorts Credit Facility
Amendment and the Resorts Credit Facility Conversion shall have occurred.
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Collectively, the Class A Common Stock, the Series A Preferred Stock, the Series
B Preferred Stock and the Common Stock, together with all other equity
securities issued by ASC, are referred to herein as the "Securities".
C. As a condition and inducement to MeriStar's willingness to
enter into the Merger Agreement, MeriStar has requested that each Stockholder
agree, and each Stockholder has agreed, to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties and covenants contained in this Agreement, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
VOTING OF SUBJECT SHARES
Section 1.1 Agreement to Vote Subject Shares. At any meeting
(a "Stockholders Meeting") (including any and all postponements and adjournments
thereof) of the stockholders of ASC called to consider and vote upon (i) the
approval of the Merger, the Merger Agreement and the transactions contemplated
thereby, (ii) the issuance of Common Stock to the stockholders of MeriStar
pursuant to the Merger Agreement, (iii) the recapitalization and Common Stock
issuances contemplated by Sections 3.3, 3.4 and 3.5 of this Agreement, (iv) the
transactions contemplated by Section 2.6 of the Merger Agreement, (v) the
election of directors for ASC as provided in Schedule 1.1 to this Agreement and
(vi) the adoption of amendments to the articles of incorporation and bylaws of
ASC in connection with the Merger (the actions referred to in clauses (i)
through (vi) being referred to collectively as the "Proposals"), and in
connection with any action to be taken in respect of the Proposals by written
consent of the stockholders of ASC, each Stockholder shall vote or cause to be
voted (including by written consent, if applicable) all of such Stockholder's
Subject Shares in favor of the approval and adoption of the Proposals and in
favor of any other matter necessary for the consummation of the transactions
contemplated by the Merger Agreement and this Agreement and considered and voted
upon at any such meeting or made the subject of any such written consent, as
applicable. At any meeting (and at any and all postponements and adjournments
thereof) of the stockholders of ASC (an "Adverse Meeting") called to consider
and vote upon any Adverse Proposal (as defined below), and in connection with
any action to be taken in respect of any Adverse Proposal by written consent of
stockholders of ASC, each Stockholder shall vote or cause to be voted (including
by written consent, if applicable) all of such Stockholder's Subject Shares
against such Adverse Proposal. For purposes of this Agreement, the term "Adverse
Proposal" means any (a) proposal or action that would reasonably be expected to
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result in a breach of any covenant, representation or warranty of ASC set forth
in the Merger Agreement or (b) proposal or action that is intended or would
reasonably be expected to impede, interfere with, delay or materially and
adversely affect the Merger or any of the other transactions contemplated by the
Merger Agreement or this Agreement.
Section 1.2 Other Proxies Revoked. Any proxies heretofore
given in respect of such Stockholder's Subject Shares are not irrevocable and
all such proxies are hereby revoked (other than the proxies specified in Item 2
of Schedule 2.1), it being understood that, with respect to the revocation made
concerning the Subject Shares beneficially owned by Xxxxx, ING (U.S.) Capital
LLC ("ING") expressly acknowledges and agrees to such revocation; provided,
that, subject to Article III, such acknowledgment and agreement shall in no way
alter any existing or future rights of ING with respect to the pledge of any
Class A Common Stock or Common Stock pledged to it by Xxxxx.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
Section 2.1 Representations and Warranties of the
Stockholders. Each Stockholder, severally and not jointly, represents and
warrants, as of the date hereof, the time of each ASC Stockholders Meeting, each
Adverse Meeting and as of the Effective Time, to MeriStar and ASC as follows:
(a) Except as specified on Schedule 2.1 hereto and except for
Subject Shares transferred in accordance with Section 3.1 hereof after the date
hereof, such Stockholder is the sole record and beneficial owner of the number
and type of Securities set forth opposite such Stockholder's name on Annex A
hereto (such Securities, together with any other Securities or other equity or
voting interests in ASC the beneficial ownership of which is hereafter acquired
by such Stockholder and any Securities into which such Securities or other
equity or voting interests are converted, being collectively referred to herein
as such Stockholder's "Subject Shares") and has full, unrestricted and sole
power to dispose of and to vote such Subject Shares. Such Subject Shares are
now, and at all times prior to the Effective Time will be, held by such
Stockholder, or by a nominee or custodian for the benefit of such Stockholder,
free and clear of all liens, voting trusts or agreements, powers of attorney,
proxies or any other arrangement or agreement with any person or entity limiting
or affecting such Stockholder's legal power or authority to vote or sell the
Subject Shares, except for those restrictions arising hereunder or set forth
under applicable securities laws and except as specified on Schedule 2.1 hereto.
Except as otherwise specified on Schedule 2.1 hereto, such Stockholder does not
beneficially own or hold any rights to acquire any additional securities of ASC
other than such Subject Shares.
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(b) In the case of a Stockholder who is an individual, such
Stockholder is an adult, is a citizen of the United States of America and is
competent to execute and deliver this Agreement, to carry out his or her
obligations hereunder and to consummate the transactions contemplated hereby. In
the case of a Stockholder that is a corporation, trust or other business
organization, such Stockholder has all requisite power and authority to enter
into this Agreement and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement by such Stockholder and the
consummation by such Stockholder of the transactions contemplated hereby have
been duly authorized by all necessary action, if any, on the part of such
Stockholder. This Agreement has been duly executed and delivered by such
Stockholder and, assuming that this Agreement constitutes the valid and binding
obligation of MeriStar, this Agreement constitutes a valid and binding
obligation of such Stockholder, enforceable against such Stockholder in
accordance with its terms, subject to applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally and to general principles of equity.
(c) The execution and delivery of this Agreement does not,
and the consummation of the transactions contemplated hereby and compliance with
the provisions hereof will not, conflict with, result in a breach or violation
of or default (with or without notice or lapse of time or both) under, give rise
to a material obligation, a right of termination, cancellation, or acceleration
of any obligation or a loss of a material benefit under, or require notice to or
the consent of any person under (i) in the case of a Stockholder that is a
corporation or other business organization, any organizational documents of such
Stockholder, (ii) in the case of any Stockholder that is a trust, violate or
conflict with any term or provision of the indenture, or other governing or
testamentary instrument relating to such trust or (iii) in the case of any
Stockholder, any Contract, agreement, instrument, undertaking, Law, order,
injunction, determination or award binding on such Stockholder, other than any
such conflicts, breaches, violations, defaults, obligations, rights or losses
that, individually or in the aggregate, would not (i) impair the ability of such
Stockholder to perform such Stockholder's obligations under this Agreement or
(ii) prevent or delay the consummation of any of the transactions contemplated
hereby.
(d) Each Stockholder understands and acknowledges that the
issuance of the Common Stock and the New Series A Preferred Stock in accordance
with Sections 3.3, 3.4, 3.5 and 3.6 of this Agreement is pursuant to one or more
of the exemptions from registration provided for in Section 3(a) or 4(2) of the
Securities Act, including Regulation D promulgated thereunder, and any
applicable state laws, and the offer and sale of the Common Stock and the New
Series A Preferred Stock are thus not registered under the Securities Act. Each
Stockholder further understands and acknowledges that this transaction has not
been reviewed and approved by the SEC or by any state regulatory authority and
represents and warrants that it is an "accredited investor," as defined in Rule
501(a) of Regulation D under the Securities Act.
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Section 2.2 Representations and Warranties of ASC.
(a) ASC represents and warrants, as of the date hereof and as
of the Effective Time, to MeriStar and each of the Stockholders that:
(i) ASC has all requisite power and authority to enter into
this Agreement, and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement by ASC and the
consummation by ASC of the transactions contemplated hereby have been
duly authorized by all necessary action on the part of ASC. This
Agreement has been duly executed and delivered by ASC and, assuming
that this Agreement constitutes the valid and binding obligation of the
other parties to this Agreement, this Agreement constitutes a valid and
binding obligation of ASC, enforceable against ASC in accordance with
its terms, subject to applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally and to general principles of
equity;
(ii) The execution and delivery of this Agreement by ASC does
not, and the consummation of the transactions contemplated hereby and
compliance with the provisions hereof will not, conflict with, result
in a breach or violation of or default (with or without notice or lapse
of time or both) under, give rise to a material obligation, a right of
termination, cancellation, or acceleration of any obligation or a loss
of a material benefit under, or require notice to or the consent of any
person under (i) any organizational documents of ASC or (ii) any
Contract, agreement, instrument, undertaking, Law, judgment, order,
injunction, decree, determination or award binding on ASC, other than
any such conflicts, breaches, violations, defaults, obligations, rights
or losses that, individually or in the aggregate, would not (i) impair
the ability of ASC to perform its obligations under this Agreement or
(ii) prevent or delay the consummation of any of the transactions
contemplated hereby; and
(iii) Assuming that the representations and warranties made by
the Stockholders in Section 2.2(d) are true and correct, the issuance
of the Common Stock and New Series A Preferred Stock in accordance with
Sections 3.3, 3.4, 3.5 and 3.6 hereof will not require registration
under the Securities Act or violate applicable state securities laws.
(b) ASC represents and warrants, as of the date hereof and as
of the Effective Time:
(i) To Xxxxx, that all shares of Common Stock to be issued
pursuant to Section 3.3 of this Agreement will be, upon issuance on the
terms and conditions specified in this Agreement, duly authorized,
validly issued, fully paid, nonassessable and will not be subject to
preemptive rights;
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(ii) To Xxxxxxxxx, that all shares of New Series A Preferred
Stock and Common Stock to be issued upon conversion of the Series A
Preferred Stock pursuant to Section 3.4(a) of this Agreement will be,
upon such issuance on the terms and conditions specified in this
Agreement, duly authorized, validly issued, fully paid, nonassessable
and will not be subject to preemptive rights;
(iii) To OCP, OCMP, XXX, XXX0 and OSLP, that all shares of
Common Stock to be issued pursuant to Section 3.4(b) of this Agreement
will be, upon issuance on the terms and conditions specified in this
Agreement, duly authorized, validly issued, fully paid, nonassessable
and will not be subject to preemptive rights; and
(iv) To OCP, that all shares of Common Stock to be issued
pursuant to Section 3.5 of this Agreement will be, upon issuance on the
terms and conditions specified in this Agreement, duly authorized,
validly issued, fully paid, nonassessable and will not be subject to
preemptive rights.
ARTICLE III
CERTAIN COVENANTS
Section 3.1 Restriction on Transfer of Subject Shares; Proxies and
Noninterference. No Stockholder shall, prior to the Effective Time, directly or
indirectly: (A) except pursuant to the terms of this Agreement, offer for sale,
sell, transfer, pledge, tender, encumber, assign or otherwise dispose of, or
enter into any contract, option or other arrangement or understanding with
respect to or consent to the offer for sale, sale, transfer, tender,
encumbrance, assignment or other disposition of, any or all of such
Stockholder's Subject Shares, unless it receives (i) an irrevocable proxy, in
form and substance substantially similar to Exhibit A hereto, to vote the
transferred Subject Shares as provided therein and (ii) a deed of adherence to
this Agreement (including representations and warranties of the type set forth
in Section 2.1 hereof) reasonably satisfactory to the other parties hereto
executed by the transferee of such Subject Shares; (B) except pursuant to the
terms of this Agreement, grant any proxies or powers of attorney, deposit any of
such Stockholder's Subject Shares into a voting trust or enter into a voting
agreement with respect to any of such Stockholder's Subject Shares; or (C) take
any action that would reasonably be expected to make any representation or
warranty contained herein untrue or incorrect or have the effect of impairing
the ability or preventing or delaying the consummation of any of the
transactions contemplated hereby of such Stockholder to perform such
Stockholder's obligations under this Agreement.
Section 3.2 Reliance by MeriStar; Cooperation. Each Stockholder
understands and acknowledges that MeriStar is entering into the Merger Agreement
in reliance upon the Stockholders' execution and delivery of this Agreement.
Each Stockholder shall cooperate fully with ASC and MeriStar in
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connection with the respective reasonable best efforts of ASC and MeriStar to
fulfill the conditions to the Merger set forth in Article VI of the Merger
Agreement.
Section 3.3 Conversion of Class A Common Stock. Prior to or at the
Effective Time, Xxxxx and ASC shall cause each share of Class A Common Stock to
be converted into one share of Common Stock.
Section 3.4 Recapitalization. Subject to the receipt of the
Requisite ASC Vote in favor of the transactions described in this Section 3.4:
(a) Immediately prior to the Effective Time, Xxxxxxxxx and
ASC shall cause a recapitalization of ASC in which all of the issued and
outstanding shares of Series A Preferred Stock are converted into (i) such
number of shares of New Series A Preferred Stock equal to the aggregate
liquidation preference for all the shares of Series A Preferred Stock plus
accrued and unpaid dividends on such stock, determined as of the Closing Date
(the "Preferred Value"), divided by $1,000 and (ii) a number of shares of Common
Stock calculated by dividing (x) 20.7% of the Preferred Value by (y) $2.22;
(b) Immediately prior to the Effective Time, OCP, OCMP, XXX,
XXX0, OSLP and ASC shall cause all of the issued and outstanding shares of
Series B Preferred Stock to be converted into a number of shares of Common Stock
calculated by dividing the aggregate Liquidation Price (as defined in the
Certificate of Designation of the Series B Preferred Stock) of such shares as of
October 31, 2000 by $2.22;
(c) Prior to the Effective Time, if no shares of the capital
stock of Resort Properties have been issued to OCP under the Warrant Purchase
Agreement, ASC shall issue the Warrants to OCP in accordance with the terms of
the Warrant Purchase Agreement; and
(d) Prior to the Effective Time, if shares of the capital
stock of Resort Properties have been issued to OCP under the Warrant Purchase
Agreement, OCP shall transfer those shares of the capital stock of Resort
Properties to ASC, and ASC shall issue the Warrants to OCP in accordance with
the terms of the Warrant Purchase Agreement.
Section 3.5 Issuance of Common Stock to Tranche C Lenders. Prior
to the Effective Time:
(a) ASC and OCP shall cause the entire $13.0 million
available under Tranche C of the Resorts Credit Facility to be drawn; and
(b) ASC and OCP shall cause the Resorts Credit Facility
Amendment to occur and shall cause Tranche C under the Resorts Credit Facility
to be repaid in the form of an issuance of a number of shares of Common Stock
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calculated by dividing (x) the outstanding aggregate principal amount of such
Tranche C as of the Effective Time plus all accrued and unpaid interest on the
aggregate outstanding principal amount of such Tranche C through October 31,
2000 by (y) $2.22.
Section 3.6 Closing Procedures.
(a) Immediately prior to the Effective Time, upon the filing
of an amended and restated certificate of incorporation of ASC in accordance
with Section 1.6 of the Merger Agreement and a certificate of designations
relating to the New Series A Preferred Stock, substantially in the form attached
to this Agreement as Exhibit B, the Series A Preferred Stock shall automatically
be converted into shares of New Series A Preferred Stock and shares of Common
Stock pursuant to Section 3.4(a) and certificates formerly representing such
shares of Series A Preferred Stock shall, from and after such time, represent
the right to receive that number of shares of New Series A Preferred Stock and
shares of Common Stock provided in Section 3.4(a). Each holder shall surrender
the certificate or certificates formerly representing the Series A Preferred
Stock, duly endorsed, at the offices of Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
at or prior to the Effective Time (or such other place as ASC shall reasonably
request) and shall give written notice to ASC of the name or names in which the
certificate or certificates for shares of New Series A Preferred Stock and
Common Stock are to be issued. ASC shall, at the Effective Time, issue and
deliver at the offices of Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx to such
holder of Series A Preferred Stock, or to the nominee or nominees of such
holder, a certificate or certificates for the number of shares of New Series A
Preferred Stock and Common Stock to which such holder is entitled under Section
3.4(a). Such conversion shall be deemed to have been made as of the Effective
Time, and the person or persons entitled to receive the shares of New Series A
Preferred Stock and Common Stock issuable upon such conversion shall be treated
for all purposes as the record holder or holders of such shares of New Series A
Preferred Stock and Common Stock as of the Effective Time. When issued, the
certificates evidencing such shares of New Series A Preferred Stock and Common
Stock shall not bear legends or other notations relating to restrictions on
transfer, other than as required pursuant to Article Thirteenth of the
Certificate of Incorporation of ASC (as amended as of the Effective Time).
(b) Except as specifically provided in this Agreement, the
conversion of the Series B Preferred Stock into Common Stock shall occur as
provided in Section 9(b) of the Certificate of Designation relating to the
Series B Preferred Stock.
(c) Upon completion of the transactions required by Section
3.5, ASC and OCP shall execute an instrument (in form reasonably satisfactory to
ASC and OCP) evidencing the repayment in full of Tranche C under the Resorts
Credit Facility and the issuance of the shares of Common Stock in repayment
thereof.
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(d) In connection with any of the transactions required by
Sections 3.4 or 3.5, ASC shall not be required to issue fractions of shares of
Common Stock or New Series A Preferred Stock or to distribute certificates which
evidence fractions of such shares. In lieu of fractional shares, ASC shall pay,
at the effective time of any conversion as herein provided, an amount in cash
equal to such fraction multiplied by (i) $2.22, in the case of Common Stock, or
(ii) $1,000, in the case of New Series A Preferred Stock.
Section 3.7 No Further Issuances of Stock. Prior to the Effective
Time, ASC shall not issue any additional shares of Class A Common Stock, Series
A Preferred Stock or Series B Preferred Stock.
Section 3.8 ING. In the event that ING elects to foreclose on any
Securities pledged to it by Xxxxx or to exercise voting rights with respect to
such Securities, ING shall provide MeriStar, ASC and OCP with reasonable prior
notice of such intent.
Section 3.9 Plan of Reorganization. This Agreement is intended to
constitute a "plan of reorganization" within the meaning of Section 1.368-2(g)
of the income tax regulations promulgated under the Code. From and after the
date of this Agreement and until the Effective Time, each party to this
Agreement shall use its reasonable best efforts to cause the Recapitalization to
qualify, and shall not, without the prior written consent of the parties to this
Agreement, knowingly take any actions or cause any actions to be taken which
could prevent such recapitalization from qualifying, as a reorganization under
the provisions of Section 368(a) of the Code. Following the Effective Time, and
consistent with any such consent, none of MeriStar, ASC or any of their
affiliates shall knowingly take any action or knowingly cause any action to be
taken which would cause the Recapitalization to fail to so qualify as a
reorganization under Section 368(a) of the Code.
Section 3.10 Restriction on Certain Amendments to the Merger
Agreement. ASC and MeriStar shall not permit an amendment to Section 2.1 or 2.4
of the Merger Agreement without the prior written consent of Xxxxxxxxx if such
amendment would cause material dilution of Madeleine's holdings in ASC.
ARTICLE IV
MISCELLANEOUS
Section 4.1 Fees and Expenses. Each party hereto shall pay its own
expenses incident to preparing for, entering into and carrying out this
Agreement and the consummation of the transactions contemplated hereby, except
that all reasonable expenses, including attorneys' fees, (i) incurred by Oak
Hill (excluding expenses incurred by holders of the Snow Subordinated Notes in
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connection with the Snow Notes Consent) in connection with this Agreement, not
to exceed $100,000, and (ii) incurred by Xxxxxxxxx, not to exceed $35,000, in
connection with this Agreement shall be paid by ASC.
Section 4.2 Amendment; Termination. This Agreement may not be
amended except by an instrument in writing signed on behalf of each of the
parties hereto. This Agreement shall terminate immediately upon the earlier to
occur of (i) the termination of the Merger Agreement in accordance with its
terms and (ii) June 30, 2001. In addition, this Agreement may be terminated by
mutual written consent of MeriStar, ASC and the Stockholders. In the event of
termination of this Agreement pursuant to this Section 4.2, this Agreement shall
become null and void and of no effect with no liability on the part of any party
hereto and all Proxies shall automatically terminate; provided, however, that no
such termination shall relieve any party hereto from any liability for any
breach of this Agreement occurring prior to such termination; and provided,
further, that Article II shall survive the termination of this Agreement.
All covenants and agreements that contemplate performance
after the Effective Time shall survive the Effective Time.
Section 4.3 Extension, Waiver. Any agreement on the part of a
party to waive any provision of this Agreement, or to extend the time for any
performance hereunder, shall be valid only if set forth in an instrument in
writing signed on behalf of such party. The failure of any party to this
Agreement to assert any of its rights under this Agreement or otherwise shall
not constitute a waiver of such rights.
Section 4.4 Entire Agreement; No Third-Party Beneficiaries. This
Agreement constitutes the entire agreement, and supersedes all prior agreements
and understandings, both written and oral, among the parties with respect to the
subject matter of this Agreement and is not intended to confer upon any person
other than the parties any rights or remedies.
SECTION 4.5 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, REGARDLESS
OF ANY PRINCIPLES OF CONFLICTS OF LAWS THEREOF THAT MIGHT INDICATE THE
APPLICABILITY OF THE LAWS OF ANY OTHER JURISDICTION, EXCEPT WHERE THE LAWS OF
THE STATE OF DELAWARE ARE MANDATORILY APPLICABLE.
Section 4.6 Notices. All notices, requests, claims, demands
and other communications under this Agreement shall be in writing and shall be
deemed given if delivered personally, by hand delivery or telecopy (with a
confirmation copy sent for next day delivery via courier service, such as
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Federal Express), or sent by overnight courier, such as Federal Express
(providing proof of delivery). All communications hereunder shall be delivered
to the respective parties at the following addresses:
If to the Stockholders:
to the addresses set forth on Annex A hereto.
If to ASC:
American Skiing Company
Xxx Xxxxxxxx Xxx
Xxxxxxxx, Xxxxx 00000
Attention: Xxxxxxxxxxx X. Xxxxxx, Esq.
Xxxxxx X. Xxxxxxx, Xx., Esq.
Telecopy: (000) 000-0000
with a copy to:
Shearman & Sterling
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxx Xxxxxx, Esq.
Telecopy: (000) 000-0000
If to MeriStar:
MeriStar Hotels & Resorts, Inc.
0000 Xxxxxxxxx Xxxxxx, XX
Xxxxxxxxxx, XX 00000
Attention: Xxxxxxxxxxx X. Xxxxxxx, Esq.
Telecopy: (000) 000-0000
with a copy to:
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
Telecopy: (000) 000-0000
Section 4.7 Assignment. Neither this Agreement nor any of the
rights, interests or obligations under this Agreement may be assigned or
delegated, in whole or in part, by operation of law or otherwise, by any
Stockholder without the prior written consent of MeriStar, or by MeriStar
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without the prior written consent of the Stockholders and any such assignment or
delegation that is not consented to shall be null and void. Subject to the
preceding sentence, this Agreement shall be binding upon, inure to the benefit
of, and be enforceable by, the parties and their respective successors and
assigns (including, without limitation, any person to whom any Subject Shares
are sold, transferred or assigned).
Section 4.8 Further Assurances. Each Stockholder shall execute and
deliver such other documents and instruments and take such further actions as
may be necessary or appropriate or as may be reasonably requested by MeriStar in
order to ensure that MeriStar receives the full benefit of this Agreement.
Section 4.9 Enforcement. Irreparable damage would occur in the
event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. Accordingly,
the parties shall be entitled to an injunction or injunctions to prevent
breaches of this Agreement and to enforce specifically the terms and provisions
of this Agreement in the federal courts of the United States located in the
State of New York, this being in addition to any other remedy to which they are
entitled at law or in equity. Each of the parties hereto (i) shall submit itself
to the jurisdiction of the federal courts of the United States of America
located in the State of New York in the event any dispute arises out of this
Agreement or any of the transactions contemplated hereby, (ii) shall not attempt
to deny or defeat such personal jurisdiction by motion or other request for
leave from any such court, and (iii) shall not bring any action relating to this
Agreement or any of the transactions contemplated hereby in any court other than
the federal courts of the United States of America located in the State of New
York.
Section 4.10 Waiver of Trial by Jury. Each party acknowledges and
agrees that any controversy that may arise under this Agreement is likely to
involve complicated and difficult issues, and therefore each such party hereby
irrevocably and unconditionally waives any right such party may have to a trial
by jury in respect of any litigation directly or indirectly arising out of or
relating to this Agreement or the transactions contemplated by this Agreement.
Each party certifies and acknowledges that (i) no representative, agent or
attorney of any other party has represented, expressly or otherwise, that such
other party would not, in the event of litigation, seek to enforce the foregoing
waiver, (ii) each such party understands and has considered the implications of
this waiver, (iii) each such party makes this waiver voluntarily, and (iv) each
such party has been induced to enter into this agreement by, among other things,
the mutual waivers and certifications in this Section 4.10.
Section 4.11 Severability. Whenever possible, each provision or
portion of any provision of this Agreement shall be interpreted in such manner
as to be effective and valid under applicable law but if any provision or
portion of any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability shall not affect
13
any other provision or portion of any provision in such jurisdiction, and this
Agreement shall be reformed, construed and enforced in such jurisdiction as if
such invalid, illegal or unenforceable provision or portion of any provision had
never been contained herein.
Section 4.12 Counterparts. This Agreement may be executed in one
or more counterparts, all of which shall be considered one and the same
instrument and shall become effective when one or more counterparts have been
signed by each party and delivered to the other parties.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be signed as of the day and year first written above.
MERISTAR HOTELS & RESORTS, INC.
By: /s/ Xxxx X. Xxxxxxxx
-------------------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Chief Executive Officer and Chairman of the
Board
AMERICAN SKIING COMPANY
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------------------
Name: Xxxxxx X. Xxxxx
Title: President
/s/ Xxxxxx X. Xxxxx
------------------------------------------------------
Xxxxxx X. Xxxxx
XXXXXX XXXXX TRUST
F/B/O XXXXXXX XXXXX
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Trustee
OAK HILL CAPITAL PARTNERS, L.P.
By: OHCP GenPar, L.P., its general partner
By: OHCP MGP, LLC, its general partner
By: /s/ Xxxxx X. Xxxx
-------------------------------------------------
Name: Xxxxx X. Xxxx
Title: Vice President
OAK HILL CAPITAL MANAGEMENT PARTNERS, L.P.
By: OHCP GenPar, L.P., its general partner
By: OHCP MGP, LLC, its general partner
By: /s/ Xxxxx X. Xxxx
-------------------------------------------------
Name: Xxxxx X. Xxxx
Title: Vice President
OAK HILL SECURITIES FUND, L.P.
By: Oak Hill Securities GenPar, L.P.,
its general partner
By: Oak Hill Securities MGP, Inc., its general partner
By: /s/ Xxxxx X. August
-------------------------------------------------
Name: Xxxxx X. August
Title: Vice President
OAK HILL SECURITIES FUND II, L.P.
By: Oak Hill Securities GenPar II, L.P.,
its general partner
By: Oak Hill Securities MGP II, Inc.,
its general partner
By: /s/ Xxxxx X. August
-------------------------------------------------
Name: Xxxxx X. August
Title: President
OHCP SKI, L.P.
By: Oak Hill Capital Partners, L.P.,
its general partner
By: OHCP GenPar, L.P., its general partner
By: OHCP MGP, LLC, its general partner
By: /s/ Xxxxx X. Xxxx
-------------------------------------------------
Name: Xxxxx X. Xxxx
Title: Vice President
XXXXXXXXX LLC
By: /s/ Xxx Xxxxxxxxx
-------------------------------------------------
Name: Xxx Xxxxxxxxx
Title: Attorney in fact
Accepted and agreed as to
Sections 1.2 and 3.7 hereof:
ING (U.S.) CAPITAL LLC,
AS PLEDGEE OF SHARES
OF CLASS A COMMON
STOCK AND COMMON STOCK
BENEFICIALLY OWNED BY
XXXXXX X. XXXXX
By: /s/ Xxxxxxx X. Xxxxxxx
----------------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
Annex A
Stockholder Address Type of ASC Security Number
Xxxxxxxxx LLC 000 Xxxx Xxxxxx Series A Preferred Stock 36,626
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxxxx
With a copy to:
Xxxxxx Xxxxx, Esq.
Xxxxxxx Xxxx & Xxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Oak Hill Capital Partners, L.P. * Series B Preferred Stock 129,870
Oak Hill Capital Management Partners, * Series B Preferred Stock 3,330
L.P.
Oak Hill Securities Fund, L.P. * Series B Preferred Stock 7,400
Oak Hill Securities Fund II, L.P. * Series B Preferred Stock 7,400
OHCP Ski, L.P. * Series B Preferred Stock 2,000
Xxxxxx X. Xxxxx c/o American Skiing Company Common Stock 833,333
Sunday Xxxxx Xxxxxx Xxxx, Xxxxxx, XX
00000
Class A Common Stock 14,760,530
Xxxxxx Xxxxx Trust f/b/o Xxxxxxx c/o American Skiing Company Common Stock 30,000
Xxxxx Sunday Xxxxx Xxxxxx Xxxx, Xxxxxx, XX
00000
* The address of OCP, OCMP, XXX, XXX0 and OSLP is:
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxx Xxxxx, Xxxxx 00000
Attention: Xxxxx X. Xxxx
Exhibit A
IRREVOCABLE PROXY
The undersigned shareholder of AMERICAN SKIING COMAPANY, a
Delaware corporation ("ASC") hereby appoints MERISTAR HOTELS & RESORTS, INC., a
Delaware corporation ("MeriStar"), as proxy for the undersigned, with full power
of substitution, to attend any annual or special meeting of the shareholders of
ASC (including any and all adjournments and postponements thereof), and in
respect of any written consent in lieu of such meeting, held or made for the
purpose of considering or voting upon the matters described in Section 1.1 of
the Voting and Recapitalization Agreement, dated the date hereof, among MeriStar
and certain shareholders of ASC (the "Agreement"), in accordance with such
Section 1.1, and to cast all votes that the undersigned is entitled to cast at
such a meeting (or in connection with such written consent) with respect to all
of the undersigned's Subject Shares (as defined in the Agreement) with respect
to the matters described in Section 1.1 of the Agreement. The undersigned hereby
revokes any proxy heretofore given with respect to such a meeting (or written
consent in lieu thereof) or with respect to such a vote cast. The undersigned
affirms that this proxy is a power coupled with an interest and shall be
irrevocable. The undersigned shall take such further action or execute such
other instruments as may be necessary to effectuate the intent of this
irrevocable proxy. This proxy shall be automatically revoked upon the
termination of the Agreement.
[Name of Stockholder]
Please sign exactly as name appears on the By
records of ASC and date. When signing as attorney, -----------------------
executor, administrator, trustee, guardian, Name:
officer of a corporation or other entity or in Title:
another representative capacity, please give
the full title under signature(s).
Dated: December __, ____
EXHIBIT B
Section 1. DESIGNATION AND AMOUNT. There is hereby created and
authorized a series of Serial Preferred Stock, the designation of which shall be
the Series A 14% Preferred Stock (herein the "SERIES A PREFERRED STOCK"). The
number of issuable shares of Series A Preferred Stock shall be 60,000.
Section 2. RANK. All shares of Series A Preferred Stock, both as to
payment of dividends and to distribution of assets upon liquidation, dissolution
or winding up of the corporation, whether voluntary or involuntary, shall rank
prior to all of the corporation's now or hereafter issued preferred stock, and
senior to all of the corporation's now or hereafter issued Common Stock or any
other common stock of any class of the corporation. The term "Common Stock"
shall mean the Common Stock, par value $.01 per share, of the corporation as the
same exists at the date hereof or as such stock may be constituted from time to
time.
Section 3. DIVIDENDS AND CERTAIN RESTRICTIONS. The holders of the
Series A Preferred Stock shall be entitled to receive, when, as and if declared
by the Board of Directors of the corporation out of funds of the corporation
legally available therefor, dividends at a rate per share of 14% per annum, and
no more on the sum of (x) the Liquidation Preference plus (y) all then accrued
and unpaid dividends. Such dividends shall be fully cumulative, shall accrue and
compound quarterly, beginning on the date of issuance, on January 1, April 1,
July 1 and October 1 of each year (whether or not declared or paid), and shall
be payable in cash on August 15, 2006, or, at the option of the corporation, in
whole or in part on any January 1, April 1, July 1 or October 1 (except that if
such date is a Saturday, Sunday or legal holiday, then such dividend will be
payable on the next day that is not a Saturday, Sunday or legal holiday) to
holders of record as they appear on the stock transfer books of the corporation
on such record date, not more than 60 nor less than 10 days preceding the
payment date for such dividend, as is fixed by the Board of Directors. For
purposes hereof, the term "legal holiday" shall mean any day on which banking
institutions are obligated or authorized to close in New York, New York or in
Boston, Massachusetts.
On such dividend payment date all dividends which shall have accrued on
each share of Series A Preferred Stock outstanding on such dividend payment date
shall accumulate and be deemed to become "due". If such dividends are not fully
paid on such dividend payment date, such accrued dividends shall be added
(solely for the purpose of calculating dividends payable on the Series A
Preferred Stock) to the Liquidation Preference of the Series A Preferred Stock
effective at the beginning of the quarterly dividend compounding period next
succeeding the dividend payment date as to which such dividends were not paid
and shall thereafter accrue additional dividends in respect thereof until such
unpaid dividends have been paid in full. Dividends paid on shares of Series A
Preferred Stock in an amount less than the total amount of such dividends at the
time accumulated and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding. Dividends
payable on the Series A Preferred Stock in respect of any period of less than a
calendar quarter shall be computed on the basis of a 90-day quarter. Upon the
request of a holder of Series A Preferred Stock, the corporation will promptly
deliver to such holder a written statement describing the amount of accrued and
unpaid dividends, calculated as of the date of such request, in respect of the
Series A Preferred Stock held by such holder.
Unless all accrued and unpaid dividends on the Series A Preferred Stock
that are due and payable in cash have been paid in cash, or declared and sums
set aside for the payment thereof, dividends (other than in Common Stock or any
other stock of the corporation ranking junior to the Series A Preferred Stock as
to dividends and as to liquidation rights) may not be paid, or declared and set
aside for payment, and other distributions may not be made upon the Common Stock
or on any other stock of the corporation ranking junior to the Series A
Preferred Stock as to dividends. So long as any shares of Series A Preferred
Stock are outstanding, the Common Stock (or any rights, options or warrants to
purchase Common Stock), any other stock or other equity interests (or rights,
options or warrants to purchase such other stock or other equity interests) of
the corporation ranking junior to the Series A Preferred Stock as to dividends
or upon liquidation may not be redeemed, purchased or otherwise acquired for any
consideration by the corporation.
Cash dividends on the Series A Preferred Stock may not be declared,
paid or set apart for payment if (a) the corporation is not solvent or would be
rendered insolvent thereby or (b) the terms and provisions of any law, or any
agreement of the corporation relating to the corporation's indebtedness for
borrowed money, specifically prohibit such declaration, payment or setting apart
for payment or provide that such declaration, payment or setting apart for
payment would constitute a violation or breach thereof or a default thereunder.
The corporation shall not permit any subsidiary of the corporation to
purchase or otherwise acquire for consideration any shares of stock (or rights,
options or warrants to purchase shares of stock or other equity interests) of
the corporation unless the corporation could, under this Section 3, purchase or
otherwise acquire such shares (or rights, options or warrants to purchase shares
of stock) or units at such time and in such manner.
Any reference to "distribution" contained in this Section 3 shall not
be deemed to include any distribution made in connection with any liquidation,
dissolution or winding up of the corporation, whether voluntary or involuntary.
Section 4. LIQUIDATION PREFERENCE. In the event of a liquidation,
dissolution or winding up of the corporation, whether voluntary or involuntary,
the holders of Series A Preferred Stock shall be entitled to receive out of the
assets of the corporation, whether such assets are stated capital or surplus of
any nature, an amount equal to $1,000 per share (the "LIQUIDATION PREFERENCE")
plus the dividends accrued and unpaid thereon to the date of final distribution
to such holders, whether or not declared, without interest, before any payment
shall be made or any assets distributed to the holders of Common Stock or any
other class or series of the corporation's capital stock ranking junior as to
liquidation rights to the Series A Preferred Stock; provided, however, that such
rights shall accrue to the holders of Series A Preferred Stock only in the event
that the corporation's payments with respect to the liquidation preferences
(plus any accrued and unpaid dividends thereon) of the holders of capital stock
of the corporation ranking senior as to liquidation rights to the Series A
Preferred Stock (the "SENIOR LIQUIDATION STOCK") are fully met. If the assets of
the corporation available for distribution after the liquidation preferences
(plus any accrued and unpaid dividends thereon) of the Senior Liquidation Stock
are fully met are not sufficient to pay an amount equal to the Liquidation
Preference (plus any accrued and unpaid dividends thereon) to the
2
holders of outstanding shares of Series A Preferred Stock and the liquidation
preference (plus any accrued and unpaid dividends thereon) to the holders of any
other series of the corporation's capital stock which may hereafter be created
in accordance with Section 6(c) hereof having liquidation rights on a parity
with the shares of Series A Preferred Stock (the "PARITY LIQUIDATION STOCK"),
then the assets of the corporation shall be distributed ratably among the
holders of the Series A Preferred Stock and the Parity Liquidation Stock in
proportion to the respective preferential amounts to which each is entitled (but
only to the extent of such preferential amounts). After payment in full of the
amounts in respect of the Liquidation Preference (and any accrued and unpaid
dividends thereon) to which they are entitled, the holders of the Series A
Preferred Stock shall not be entitled to any further participation in any
distribution of assets of the corporation. Neither a consolidation, merger or
other business combination of the corporation with or into another corporation
or other entity nor a sale or transfer of all or part of the corporation's
assets for cash, securities or other property shall be considered a liquidation,
dissolution or winding up of the corporation for purposes of this Section 4
(unless in connection therewith the liquidation of the corporation is
specifically approved).
The holder of any shares of Series A Preferred Stock shall not be
entitled to receive any payment owed for such shares under this Section 4 until
the corporation has received (i) the certificate(s) representing such shares of
Series A Preferred Stock and (ii) transfer instrument(s) satisfactory to the
corporation and sufficient to transfer such shares of Series A Preferred Stock
to the corporation free of any adverse interest. No interest shall accrue on any
payment made in respect of the Liquidation Preference (and any accrued and
unpaid dividends thereon) after the due date thereof.
Section 5. REDEMPTION. On August 15, 2006 (the "MANDATORY REDEMPTION
DATE"), the corporation shall redeem, out of funds legally available therefor,
all shares of the Series A Preferred Stock then outstanding at a redemption
price (the "REDEMPTION PRICE") equal to the Liquidation Preference per share,
together with accrued and unpaid dividends to the redemption date. If, on the
Mandatory Redemption Date, funds are not legally available to the corporation
for redemption of the shares of Series A Preferred Stock, the corporation shall
redeem on such date, at the Redemption Price, that number of shares of Series A
Preferred Stock which it can lawfully redeem, and from time to time thereafter,
as soon as funds are legally available, the corporation shall redeem at the
Redemption Price shares of Series A Preferred Stock until the corporation has
redeemed the shares of Series A Preferred Stock in full.
The corporation, at its option, may at any time, redeem, out of funds
legally available therefor, in whole or from time to time in part, the Series A
Preferred Stock on any date set by the Board of Directors, for cash at the
Redemption Price, together with accrued and unpaid dividends to the redemption
date (subject to the right of the holder of record of shares of Series A
Preferred Stock on a record date for the payment of a dividend on the Series A
Preferred Stock to receive the dividend due on such shares of Series A Preferred
Stock on the corresponding dividend payment date, if such dividend payment date
is prior to the date set for redemption).
In case of the redemption of less than all of the then outstanding
Series A Preferred Stock, the corporation shall select the shares of Series A
Preferred Stock to be redeemed in accordance with any method permitted by the
national securities exchange on which the Series A Preferred Stock is then
listed, or if not so listed, the corporation shall designate by lot, or in such
other manner as the Board of Directors may determine, the shares to be redeemed,
or shall effect
3
such redemption pro rata. Notwithstanding the foregoing, the corporation shall
not redeem less than all of the Series A Preferred Stock at any time outstanding
until all dividends accrued to such payment date upon all Series A Preferred
Stock then outstanding shall have been paid.
Not more than 120 nor less than 90 days prior to the date of any
redemption under this Section 5, notice by first class mail, postage prepaid,
shall be given to each holder of record of the Series A Preferred Stock to be
redeemed, at such holder's address as it shall appear upon the stock transfer
books of the corporation. Each such notice of redemption shall specify the date
fixed for redemption, the Redemption Price, the place or places of payment and
that payment will be made upon presentation and surrender of the certificates
evidencing the shares of Series A Preferred Stock to be redeemed.
Any notice that is mailed as herein provided shall be conclusively
presumed to have been duly given, whether or not the holder of the Series A
Preferred Stock receives such notice; and failure to give such notice by mail,
or any defect in such notice, to the holders of any shares designated for
redemption shall not affect the validity of the proceedings for the redemption
of any other shares of Series A Preferred Stock. On or after the date fixed for
redemption as stated in such notice, each holder of the shares called for
redemption shall surrender the certificate evidencing such shares to the
corporation at the place designated in such notice and shall thereupon be
entitled to receive payment of the Redemption Price. If less than all the shares
represented by any such surrendered certificate are redeemed, a new certificate
shall be issued without cost to the holder thereof representing the unredeemed
shares. If such notice of redemption has been so mailed and if, on or prior to
the redemption date specified in such notice all funds necessary for such
redemption have been set aside by the corporation, separate and apart from its
other funds, in trust for the account of the holders of the shares so to be
redeemed (as to be and continue to be available therefor), then on and after the
redemption date, notwithstanding that any certificate for shares of the Series A
Preferred Stock so called for redemption has not been surrendered for
cancellation, all shares of the Series A Preferred Stock with respect to which
such notice shall have been mailed and such funds shall have been set aside
shall be deemed to be no longer outstanding and all rights with respect to such
shares of the Series A Preferred Stock so called for redemption shall forthwith
cease and terminate, except the right of the holders thereof to receive out of
the funds so set aside in trust the amount payable on redemption thereof
(including an amount equal to accrued and unpaid dividends to the redemption
date) without interest thereon.
The holder of any shares of Series A Preferred Stock redeemed upon any
exercise of the corporation's redemption right shall not be entitled to receive
payment of the Redemption Price for such shares until such holder has caused to
be delivered to the place specified in the notice given with respect to such
redemption (i) the certificate(s) representing such shares of Series A Preferred
Stock redeemed and (ii) transfer instrument(s) satisfactory to the corporation
and sufficient to transfer such shares of Series A Preferred Stock to the
corporation free of any adverse interest. No interest shall accrue on the
Redemption Price of any share of Preferred Interests after its redemption date.
Section 6. VOTING RIGHTS.
4
(a) General. Other than as provided in Section 6(b) below, the holders
of Series A Preferred Stock shall have no voting rights with respect to any
matters upon which the stockholders of the corporation may vote. In addition,
the holders of Series A Preferred Stock will have all voting rights required by
law, and shall also have all special voting rights provided below. Any shares of
Series A Preferred Stock held by the corporation or any entity controlled by the
corporation shall not have voting rights hereunder and shall not be counted in
determining the presence of a quorum.
(b) Default Voting Rights.
(i) Right To Elect Directors. Whenever dividends that
have become due and payable in cash under Section 3 on the
Series A Preferred Stock are in arrears, or the Redemption
Price (whether mandatory or optional) has not been paid in
full when due, or an Event of Default (as hereinafter
defined), has occurred (A) the number of members of the Board
of Directors of the corporation shall be increased by two,
effective as of the time of election of such directors as
hereinafter provided, and (B) the holders of the Series A
Preferred Stock (voting separately as a class) shall have the
exclusive right (the "DEFAULT RIGHT") to vote for and elect
such two additional directors of the corporation at any
meeting of stockholders of the corporation at which directors
are to be elected held during the period such dividends remain
in arrears or such redemption price has not been paid in full.
The holders of the Series A Preferred Stock shall have this
Default Right until (x) payment in full of all accrued and
unpaid dividends on the Series A Preferred Stock has been
made, (y) payment in full of any Redemption Price which has
become due has been made or (z) the date on which such Event
of Default has ceased to be continuing. An "EVENT OF Default"
shall be deemed to occur if: (i) a default occurs under any
bond, debenture, note or other evidence of indebtedness,
whether or not contingent, for borrowed money ("INDEBTEDNESS")
by the corporation or any Restricted Subsidiary (as defined in
the Indenture dated as of June 28, 1996, as amended, relating
to the corporation's 12% Senior Subordinated Notes due 2006,
the "INDENTURE"), which default has resulted in such at least
$5.0 million aggregate principal amount of Indebtedness
becoming or being declared payable prior to the date on which
it would otherwise have been due and payable, without such
Indebtedness having been discharged, such acceleration having
been rescinded or annulled or there having been deposited in
trust a sum of money sufficient to discharge in full such
Indebtedness; or (ii) the corporation or any of its
Subsidiaries (as defined in the Indenture) fails to pay any
principal or interest when due with respect to any
Indebtedness for money borrowed (whether by scheduled
maturity, required prepayment, acceleration, demand or
otherwise) and such failure continues after the applicable
grace period, if any, specified in the agreement or instrument
evidencing or governing such Indebtedness, has expired, and
the amount of such Indebtedness, together with any interest or
premium thereon, exceeds $5.0 million).
(ii) Special Meeting. The Default Right may be
exercised initially by the vote of the holders of a majority
of the shares of the Series A Preferred Stock present and
voting, in person or by proxy, at a special meeting of holders
of the
5
Series A Preferred Stock or at the next annual meeting of
stockholders, or by written consent of the holders of record
of a majority of the outstanding shares of the Series A
Preferred Stock without a meeting. Unless such action shall
have been taken by written consent as aforesaid, a special
meeting of the holders of the Series A Preferred Stock for the
exercise of the Default Right shall be called by the Secretary
of the corporation as promptly as possible in compliance with
applicable laws and regulations, and in any event within 10
days after receipt of a written request signed by the holders
of record of at least 25% of the outstanding shares of the
Series A Preferred Stock, subject to any applicable notice
requirements imposed by law or by any national securities
exchange on which any Series A Preferred Stock is listed. Such
meeting shall be held at the earliest practicable date
thereafter.
(iii) Term of Office of Directors. Any director who
has been elected by holders of the Series A Preferred Stock
shall hold office for a term expiring (subject to the earlier
payment of all dividends and redemption payments, whether
mandatory or optional, in arrears on the Series A Preferred
Stock) at the next annual meeting of stockholders and during
such term may be removed at any time, either for or without
cause, by and only by, the affirmative vote of the holders of
record of a majority of the shares of the Series A Preferred
Stock, voting as a single class, present and voting, in person
or by proxy, at a special meeting of such stockholders called
for such purpose, or by written consent without a meeting of
the holders of record of a majority of the outstanding shares
of the Series A Preferred Stock, voting as a single class, and
any vacancy created by such removal may also be filled at such
meeting or by such written consent. A special meeting of the
holders of the shares of the Series A Preferred Stock for the
removal of a director elected by the holders of the Series A
Preferred Stock and the filling of the vacancy created thereby
shall be called by the Secretary of the corporation as
promptly as possible and in any event within 10 days after
receipt of a written request therefor signed by the holders of
not less than 25% of the outstanding shares of the Series A
Preferred Stock taken as a single class, subject to any
applicable notice requirements imposed by law or any national
securities exchange on which any Series A Preferred Stock is
listed. Such meeting shall be held at the earliest practicable
date thereafter.
(iv) Vacancies. Any vacancy caused by the death or
resignation of a director who has been elected in accordance
with this Section 6 (b) may be filled by a person nominated by
the remaining director so elected or, if not so filled, by a
vote of holders of a majority of the shares of the Series A
Preferred Stock present and voting as a single class, in
person or by proxy, where at least one third of such holders
are present, in person or proxy, at a meeting of such holders
of Series A Preferred Stock called for such purpose, or by
written consent without a meeting of the holders of record of
a majority of the outstanding shares of the Series A Preferred
Stock as a single class. Unless such vacancy has been filled
by the remaining director or by written consent as aforesaid,
such meeting shall be called by the Secretary of the
corporation at the earliest practicable date after such death
or resignation, and in any event within 10 days after receipt
of a written
6
request signed by the holders of record of at least 25% of the
outstanding shares of the Series A Preferred Stock taken as a
single class.
(v) Stockholders' Right to Call Meeting. If any
meeting of the holders of the Series A Preferred Stock
required by this subparagraph (b) to be called has not been
called within 10 days after personal service of a written
request therefor upon the Secretary of the corporation or
within 15 days after mailing the same within the United States
of America by registered mail addressed to the Secretary of
the corporation at its principal office, subject to any
applicable notice requirements imposed by law or any national
securities exchange on which any Series A Preferred Stock is
listed, then the holders of record of at least 25% of the
outstanding shares of the Series A Preferred Stock may
designate in writing a holder of a share of the Series A
Preferred Stock to call such meeting at the expense of the
corporation, and such meeting may be called by such Person so
designated upon the notice required for annual meetings of
stockholders or such shorter notice (but in no event shorter
than permitted by law or any national securities exchange on
which the Series A Preferred Stock is listed) as may be
acceptable to the holders of a majority of the total number of
shares of the Series A Preferred Stock. Any holder of a share
of the Series A Preferred Stock so designated shall have
access to the stock books of the corporation relating solely
to the Series A Preferred Stock for the purpose of causing
such meeting to be called pursuant to these provisions.
(vi) Quorum. At any meeting of the holders of the
Series A Preferred Stock called in accordance with the
provisions of this subparagraph (b) for the election or
removal of directors, the presence in person or by proxy of
the holders of one-third of the total number of shares of the
Series A Preferred Stock as a single class shall be required
to constitute a quorum; in the absence of a quorum, a majority
of the holders present in person or by proxy shall have power
to adjourn the meeting from time to time without notice, other
than announcement at the meeting, until a quorum shall be
present.
(c) Class Voting Rights. So long as shares of the Series A Preferred
Stock are outstanding, the corporation shall not, directly or indirectly or
through merger or consolidation with any other person, without the affirmative
vote or consent of the holders of at least a majority of all outstanding Series
A Preferred Stock, voting separately as a class, (i) increase the authorized
number of shares of the Series A Preferred Stock, (ii) authorize or issue or
increase the authorized amount of any additional class or series of stock
(including any series of preferred stock), or any security convertible into
stock of such class or series, ranking on a parity with or senior to the Series
A Preferred Stock as to dividends or as to rights upon liquidation, dissolution
or winding up or (iii) effect any reclassification of the Series A Preferred
Stock. In connection with any right to vote pursuant to this Section 6(c), each
holder of Series A Preferred Stock shall have one vote for each share held.
Without limiting the generality of the foregoing, a class vote by the holders of
the Series A Preferred Stock shall not be required (except as otherwise required
by law or resolution of the corporation's Board of Directors) in connection with
the authorization, issuance or increase in the authorized amount of any shares
of any other class or series of stock that ranks junior to the Series A
Preferred Stock upon liquidation, dissolution or
7
winding up of the corporation if (A) dividends on such junior class or series of
stock are payable solely in additional shares of such junior class or series of
stock if cash dividends have not been paid when due on the Series A Preferred
Stock on the immediately preceding dividend payment date and (B) such junior
class or series of stock is not subject to any mandatory redemption or entitled
to any mandatory offer to purchase, in each case, prior to the Mandatory
Redemption Date.
Section 7. OUTSTANDING SHARES. For purposes of this Exhibit A, all
shares of Series A Preferred Stock shall be deemed outstanding except (i) from
the date fixed for redemption pursuant to Section 5, all shares of Series A
Preferred Stock that have been so called for redemption under Section 5 if funds
necessary for payment of the redemption price have been irrevocably deposited in
trust, for the account of the holders of the shares so to be redeemed (so as to
be and continue to be available therefor), with a corporation organized and
doing business under the laws of the United States or any State or territory
thereof or of the District of Columbia (or a corporation or other person
permitted to act as a trustee by the Securities and Exchange Commission)
authorized under such laws to exercise corporate trust powers, having a combined
capital and surplus of at least $100,000,000 and subject to supervision or
examination by Federal, State or District of Columbia or territorial authority;
and (ii) from the date of registration of transfer, all shares of Series A
Preferred Stock held of record by the corporation or any subsidiary of the
corporation.
Section 8. STATUS OF ACQUIRED SHARES. Shares of Series A Preferred
Stock redeemed by the corporation or otherwise acquired by the corporation,
shall be restored to the status of authorized and unissued shares of Serial
Preferred Stock, without designation as to series, and may thereafter be issued,
but not as shares of Series A Preferred Stock.
Section 9. PREEMPTIVE RIGHTS. The holders of Series A Preferred Stock
are not entitled to any preemptive or subscription rights in respect of any
securities of the corporation.
Section 10. REPORTS. So long as the Series A Preferred Stock remains
outstanding, the corporation shall cause its annual reports to stockholders and
any quarterly or other financial reports and information furnished by it to
stockholders pursuant to the requirements of the Securities Exchange Act of
1934, as amended (the "EXCHANGE ACT"), to be mailed to the holders of the Series
A Preferred Stock (contemporaneously with the mailing of such materials to the
corporation's stockholders) at their addresses appearing on the books of the
corporation. If the corporation is not required to furnish annual or quarterly
reports to its stockholders pursuant to the Exchange Act, it shall cause its
financial statements, including any notes thereto (and with respect to annual
reports, an auditors' report by a nationally recognized firm of independent
certified public accountants), a "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and such other information which
the corporation would otherwise be required to include in annual and quarterly
reports filed under the Exchange Act, to be mailed to the holders of the Series
A Preferred Stock, within 120 days after the end of each of the corporation's
fiscal years and within 60 days after the end of each of its first three fiscal
quarters.
Section 11. SEVERABILITY OF PROVISIONS. Whenever possible, each
provision hereof shall be interpreted in a manner as to be effective and valid
under applicable law, but if any provision
8
hereof is held to be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating or otherwise adversely affecting the remaining
provisions hereof. If a court of competent jurisdiction should determine that a
provision hereof would be valid or enforceable if a period of time were extended
or shortened or a particular percentage were increased or decreased, then such
court may make such change as shall be necessary to render the provision in
question effective and valid under applicable law.
9
SCHEDULE 1.1
Initial Directors
Name Class Nominated by
** I Oak Hill
** I Oak Hill
* I Independent
** II Oak Hill
Xx. Xxxxxx Xxxxx XX MeriStar
Mr. Xxxxx Xxxxxx II Xxxxx
* II Independent Director
Xx. Xxxxxx Xxxxxxxxx III Oak Hill
Xx. Xxxx X. Xxxxxxxx III MeriStar
Xx. Xxxxxx X. Xxxxx III Xxxxx
* III Independent
* To be determined reasonably by ASC, MeriStar, Xxxxx, OCP, OCMP, XXX, XXX0 and OSLP.
** To be determined by OCP, OCMP, XXX, XXX0 and OSLP.
SCHEDULE 2.1
Beneficial Ownership of Capital Stock of ASC
1. Xxxxxxxxx holds its Subject Shares on behalf of various funds and
accounts managed by Cerberus Capital Management, L.P. and its affiliates.
2. The Subject Shares of Xxxxxxxxx, Xxxxx, OCP, OCMP, XXX, XXX0 and OSLP are
subject to a proxy in favor of ASC to vote those Subject Shares at ASC's
annual meeting of stockholders on December 12, 2000 (and all adjournments
and postponements thereof).
3. Xxxxx holds his Subject Shares subject to the pledge granted under the
Pledge Agreement, dated November 10, 1997, between Xxxxx and ING.
