ORIGINAL
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BOOTH CREEK SKI GROUP, INC.
SECURITIES PURCHASE
AND AMENDMENT AGREEMENT
Relating to the Issuance of
$9,796,014 Notes due November 27, 2008
414.5 Shares of Class A Common Stock
1,361.8 Shares of Class B Common Stock Warrants for
783.7 Shares of Class B Common Stock (subject to adjustment)
and to Certain Amendments to Those Certain
Amended and Restated Securities Purchase Agreements dated February 26, 1998
and to Certain Waivers and Consents
under Certain of the Operative Documents
September 14, 1998
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TABLE OF CONTENTS
Page
1. Authorization of New Securities; etc................................1
2. Sale and Purchase of New Securities.................................2
3. Closing.............................................................2
4. Conditions to Closing...............................................3
4.1. Representations and Warranties Correct.......................3
4.2. Performance; No Default......................................3
4.3. Amendment to Stockholders Agreement..........................3
4.4. Compliance Certificate.......................................3
4.5. Opinion of Counsel for the Company...........................3
4.6. Certain Additional Documents to be Delivered at or Prior to
the Closing..................................................4
4.7. Payment of Transactions Costs................................4
4.8. Proceedings and Documents....................................4
5. Representations and Warranties......................................4
5.1. Organization, Standing, etc. of the Company..................4
5.2. Names; Jurisdictions of Incorporation; Subsidiaries, etc.....4
5.3. Qualification................................................5
5.4. Business, etc................................................5
5.5. Shares; Stockholders.........................................5
5.6. Financial Statements.........................................7
5.7. Changes; Solvency, etc.......................................7
5.8. Tax Returns and Payments.....................................7
5.9. Funded Debt, Current Debt, Liens, Investments,
Transactions with Affiliates, Leases and Derivative
Transactions..............................................8
5.10. Title to Properties; Liens; Leases...........................9
5.11. Litigation, etc..............................................9
5.12. Valid and Binding Obligations; Compliance with Other
Instruments, Borrowing Restrictions, etc....................9
5.13. ERISA.......................................................11
5.14. Consents, etc...............................................12
5.15. Proprietary Rights; Licenses................................12
5.16. Offer of Securities; Investment Bankers.....................12
5.17. Government Regulation.......................................13
5.18. Labor Relations.............................................13
5.19. Disclosure..................................................13
6. Use of Proceeds...................................................13
7. Covenants of the Company..........................................14
8. Certain Defined Terms.............................................14
9. Waiver and Consent of Institutional Investors.....................14
10. Ratification of Operative Documents...............................14
11. Further Assurances................................................15
12. Expenses; Indemnity...............................................15
13. Communications; Amendments........................................15
14. Survival of Agreements, Representations and Warranties, etc.......15
15. Successors and Assigns; Rights of Other Holders...................16
16. Purchase for Investment...........................................16
17. Governing Law.....................................................16
18. Miscellaneous.....................................................16
Schedule I Schedule of Purchasers
Exhibit I (a) Form of New Note
Exhibit l(b)(i Form of Certificate for Class A Common Stock
Exhibit l(b)(ii) Form of Certificate for Class B Common stock
Exhibit l(d) Form of New Warrant
Exhibit 3 Wire Instructions
Exhibit 4.5 Opinion of Winston & Xxxxxx
Exhibit 5.2 Names; Jurisdictions of Incorporation; Subsidiaries, etc.
Exhibit 5.5(a) Shares; Stockholders
Exhibit 5.5(b) Other Securities; Commitments; Preemptive and
Registration Rights
Exhibit 5.9 Funded Debt, Current Debt, Liens, Investments,
Transactions with Affiliates and Leases
Exhibit 5.11 Litigation, etc.
Exhibit 6(a) Use of Proceeds
BOOTH CREEK SKI GROUP, INC.
0000 Xxxxx Xxxxxxxx Xxxx
Xxxx, Xxxxxxxx 00000
September 14, 1998
To each of the purchasers named on Schedule I attached hereto (the "Purchasers")
and to each of the holders (the "Holders") (collectively the Purchasers and the
Holders are referred to herein as the "Investors") of the Securities issued
pursuant to (and as defined in) the Existing Securities Purchase Agreements (as
hereinafter defined)
Ladies and Gentlemen:
BOOTH CREEK SKI GROUP, INC., a Delaware corporation (the "Company"),
agrees with you as follows.
Background
A. Reference is made to those certain Amended and Restated Securities
Purchase Agreements dated February 26, 1998 (the "Existing Securities Purchase
Agreements") by and between the Company and each of Xxxx Xxxxxxx and CIBC Fund.
Capitalized terms used herein without definition have the meanings ascribed to
them in the Existing Securities Purchase Agreements.
B. The purpose of this Agreement is to provide for the issue and sale of
certain additional Securities described below and to amend, modify and
supplement the Existing Securities Purchase Agreements and the other Operative
Documents in connection therewith, all as further provided herein.
1. Authorization of New Securities: etc. The Company has authorized the
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issue and sale of:
(a) its Notes due November 27, 2008 (herein, together with any
notes issued in exchange therefor or replacement thereof, called the
"New Notes") in the aggregate principal amount of $9,796,014. The New
Notes are to be substantially in the form of Exhibit 1 (a) attached
hereto; -------------
(b) 1,361.8 shares of its Class B Common Stock (herein, such
1,361.8 shares, together with any Shares issued in exchange therefor or
replacement thereof, called the "New Purchased Class B Common Shares").
The certificates for the Class A Common Stock and Class B Common Stock
are to be substantially in the forms of Exhibit l(b)(i) and l(b)(ii)
attached hereto; ------------------------------
(c) 414.5 shares of Class A Common Stock (herein, such 414.5
shares, together with any Shares issued and in exchange therefor or
replacement thereof, called the "New Purchased Class A Common Shares",
and together with the New Purchased Class B Common Shares, the "New
Purchased Common Shares"); and
(d) its warrants evidencing rights to purchase 783.7 shares of
Class B Common Stock (subject to adjustment) (herein, together with any
warrants issued in exchange therefor or replacement thereof,
collectively called the "New Warrants"). The New Warrants are to be
substantially in the form of Exhibit I (d) attached hereto. The New
Notes, the New Purchased Common Shares and the New Warrants are herein
called the "New Securities."
2. Sale and Purchase of New Securities. The Company will issue and sell
to each of the Purchasers and, subject to the terms and conditions hereof and in
reliance upon the representations and warranties of the Company contained herein
and in the other Operative Documents, each of the Purchasers will purchase from
the Company, at the Closing, as specified in section 3, such New Securities as
are specified on that portion of Schedule I attached hereto as is applicable to
such Purchaser. The aggregate purchase price of the New Notes and New Warrants
shall be $9,796,014 which shall be allocated (a) $9,293,698.62 to the New Notes
and (b) $502,315.38 to the New Warrants. The aggregate purchase price of the New
Purchased Common Shares shall be $5,203,986 (or approximately $2,929.68 per
share). The Company and each of the Investors agree that the values ascribed to
the New Securities (which values shall be used by the Company and the Investors,
as well as any subsequent holder of any of the Securities, for all purposes,
including the preparation of tax returns) shall be determined in accordance with
the foregoing.
3. Closing.
(a) The closing of the sale and purchase of the New Securities
hereunder (the "Closing") shall take place at the office of Messrs.
Xxxxxx, Hall & Xxxxxxx, Exchange Place, 00 Xxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000, on September 14, 1998 (or on such other date, not
later than September 14, 1998, to which the Purchasers may agree) (the
"Closing Date") not later than 11:00 A.M. Boston time.
(b) At the Closing, the Company will deliver to the Purchasers
the New Securities against payment of the purchase price thereof to (or
for the benefit of) the Company in immediately available funds in
accordance with the instructions set forth on Exhibit 3 attached hereto.
Delivery of the New Securities shall be made in the form of one or more
New Notes, certificates for New Purchased Common Shares and New Warrants
in such denominations and registered in such names as are specified on
Schedule I attached hereto and in each case dated and, in the case of
each New Note, bearing interest from, the Closing Date.
(c) If at the Closing the Company shall fail to tender the New
Securities to be delivered thereat as provided herein, or if at the
Closing any of the conditions specified in section 4 shall not have been
fulfilled to the satisfaction of each of the Investors, each
Investor shall, at its election, be relieved of all further obligations
under this Agreement, without thereby waiving any other rights it may
have by reason of such failure or such non-fulfillment.
4. Conditions to Closing. Each Purchaser's obligation to purchase and pay
for the New Securities to be purchased by it hereunder at the Closing, and the
effectiveness of the amendments to the Existing Securities Purchase Agreements
and the other Operative Documents pursuant hereto, are subject to the
fulfillment to the satisfaction of each of the Investors, prior to or at the
Closing, of the following conditions:
4.1. Representations and Warranties Correct. The representations and
warranties made by the Company herein and in the other Operative Documents shall
have been correct when made and shall be correct at and as of the time of the
Closing (both before and after giving effect to the transactions consummated at
the Closing).
4.2. Performance: No Default. The Company shall have performed all
agreements and complied with all conditions contained herein and in the other
Operative Documents required to be performed or complied with by it prior to or
at the Closing, and at the time of the Closing, no Default or Event of Default
shall exist and no condition shall exist which has resulted in, or could
reasonably be expected to result in, a Material Adverse Change.
4.3. Amendment to Stockholders Agreement. CIBC Fund shall have executed
and delivered the Amendment Agreement dated as of February 26, 1998 by which the
Stockholders Agreement was amended.
4.4. Compliance Certificate. At the Closing, the Investors shall have
received an Officers' Certificate, dated the Closing Date, certifying that the
conditions specified in sections 4.1 and 4.2 have been fulfilled.
4.5. Opinion of Counsel for the Company. At the Closing, the Investors
shall have received an opinion, dated the Closing Date, from Messrs. Winston &
Xxxxxx, counsel for the Company, substantially in the form of Exhibit 4.5
attached hereto.
4.6. Certain Additional Documents to be Delivered at or Prior to the
Closing. The Investors shall have received a letter from Xxxxxx X. Xxxxxxx, Xx.
concerning the offering of the Securities.
4.7. Payment of Transactions Costs. Without limiting the generality of
the provisions of section 21 of the Existing Securities Purchase Agreements, the
Company shall have paid in immediately available funds all fees, expenses and
disbursements incurred by the Investors at or prior to the time of the Closing
in connection with the transactions contemplated by the Operative Documents,
including, without limitation, the reasonable fees, expenses and disbursements
of their special counsel.
4.8. Proceedings and Documents. All proceedings in connection with
the transactions contemplated by the Operative Documents and all agreements,
documents and instruments incident to such transactions shall be satisfactory
in substance and form to the Investors and their special counsel, and the
Investors and their special counsel shall have received all such counterpart
originals or copies of such agreements, documents and instruments as they may
reasonably request.
5. Representations and Warranties. The Company represents and warrants
that as of the date hereof and as of the Closing Date (both before and after
giving effect to the transactions Documents (or any of them) shall include this
Agreement, the New Securities and/or the other agreements, documents and
instruments, as applicable, executed (or to be executed) in connection
herewith):
5.1. Organization. Standing, etc. of the Company. The Company and each
of its Subsidiaries is a corporation or limited liability company duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or organization and has all requisite power
and authority to own, lease and operate its properties, to carry on its business
as now conducted, and now proposed to be conducted as described in the
Disclosure Documents referred to in section 5.4, to execute, deliver and perform
each of the Operative Documents to which it is (or is to be) a party and to
consummate the transactions contemplated by the Operative Documents. No approval
of the stockholders or members of the Company or any of its Subsidiaries or any
class thereof is required in connection therewith which has not previously been
obtained.
5.2. Names: Jurisdictions of Incorporation: Subsidiaries, etc. Exhibit
5.2 attached hereto correctly specifies as to the Company and each of its
Subsidiaries (a) its legal name, (b) the jurisdiction of its incorporation or
organization, (c) each jurisdiction (other than its jurisdiction of
incorporation or organization) in which it is qualified to do business and (d)
each jurisdiction in which any of its material properties are (or are to be)
located. The Company does not have any Subsidiary that is not named on Exhibit
5.2 attached hereto.
5.3. Qualification. The Company and each of its Subsidiaries is duly
qualified or licensed to do business and is in good standing in each
jurisdiction in which the character of the properties owned or leased or the
nature of the activities conducted makes such qualification or licensing
necessary, except for those jurisdictions in which the failure to be so
qualified or licensed or to be in good standing has not resulted in, and could
not reasonably be expected to result in, a Material Adverse Change.
5.4. Business, etc. The Company and its Subsidiaries are engaged in the
business of owning and operating ski resorts and related activities (the
"Business"), as further described in the Disclosure Documents.
5.5. Shares: Stockholders.
(a) Exhibit 5.5(a) attached hereto correctly and fully specifies
as to the Company and each of its Subsidiaries (after giving effect to
the transactions consummated at the Closing) (i) its authorized and
outstanding Shares and (ii) the name of each record and beneficial owner
of such Shares (and, with respect to each holder of
Shares of the Company, clearly indicates if such Person is a member of
the Xxxxxxx Family), together with the number (and class, if any) of
such Shares held by each such Person. All of the outstanding Shares of
the Company and each of its Subsidiaries are, and all Underlying
Securities issued upon exercise of the Warrants in accordance with the
terms thereof will be, duly authorized, validly issued, fully paid and
non-assessable and, except as provided in the Stockholders Agreement,
not subject to any preemptive right, right of first refusal or similar
right on the part of any other Person, and all of such Shares have been
(or will have been) offered, issued and sold in accordance with all
applicable laws. Except as set forth on Exhibit 5.5(a) attached hereto,
the owners of the Shares indicated on Exhibit 5.5(a) attached hereto own
the Shares indicated on such exhibit free of any Lien, proxy, voting
agreement, voting trust, stockholders agreement or similar agreement or
restriction (other than as provided in the Stockholders Agreement).
Except as provided by the Stockholders Agreement and except as set forth
on Exhibit 5.5(a) attached hereto, neither the Organizational Documents
nor any other agreement, document or instrument binding on or applicable
to the Company or any of its Subsidiaries or any of its stockholders
contains any provision requiring a higher voting requirement with
respect to action taken (and/or to be taken) by its board of directors
or stockholders than that which would apply in the absence of such
provision. Except for the Stockholders Agreement, The Xxxxxxx Family
Partnership has the right (by virtue of its ownership of the Shares of
the Company as shown on Exhibit 5.5(a) attached hereto) to elect or
designate for election all of the members of the board of directors of
the Company (and thereby to direct or cause the direction of the
management and policies of the Company and each of its Subsidiaries),
and, except for the Stockholders Agreement and except as set forth on
Exhibit 5.5(a) attached hereto. The Xxxxxxx Family Partnership is not
subject to any agreement or any legal or contractual restriction that
affects its right to vote such Shares or to exercise any other incident
of ownership of such Shares. The only partners and beneficial owners of
Shares of The Xxxxxxx Family Partnership are (and at all times shall be)
Xxxxxx X. Xxxxxxx, Xx. and other members of his Family.
(b) Except as provided in section 11 of the Existing Securities
Purchase Agreements, except for the Warrants (including the New
Warrants) and the Management Options and except as set forth on Exhibit
5.5 (b) attached hereto (after giving effect to the consummation of the
transactions consummated at the Closing), (i) there are no outstanding
rights, options, warrants or agreements for the purchase from, or sale
or issuance by, the Company or any of its Subsidiaries of any of its
Shares or any securities convertible into or exercisable or exchangeable
for such Shares; (ii) there are no agreements on the part of the Company
or any of its Subsidiaries to issue, sell or distribute any of its
Shares, other securities or assets; (iii) neither the Company nor any of
its Subsidiaries has any obligation (contingent or otherwise) to
purchase, redeem or otherwise acquire any of its Shares or any interest
therein or to pay any dividend or make any distribution in respect
thereof; and (iv) no Person is entitled to any rights with respect to
the registration of any Shares of the Company or any of its Subsidiaries
under the Securities Act (or the securities laws of any other
jurisdiction).
(c) The aggregate number of shares of Class B Common Stock
issuable upon exercise in full of the Warrants (including the New
Warrants) is 4,260.7, which, if such
shares were issued immediately following the Closing, would constitute
29.56% of the Common Stock calculated on a fully-diluted basis assuming
(x) the conversion, exercise and exchange of all outstanding securities
convertible into and exercisable or exchangeable for shares of Common
Stock of the Company, including, without limitation, the Warrants then
outstanding and (y) the issuance of 400 shares of Class A Common Stock
upon the exercise of the Management Options. The Company has reserved
4,260.7 shares of Class B Common Stock solely for issuance upon exercise
of the Warrants and 4,260.7 shares of Class A Common Stock solely for
issuance upon conversion of the shares of Class B Common Stock issued
upon exercise of the Warrants. Each share of each class of Common Stock
is and shall at all times be convertible into one share of duly
authorized, validly issued, fully paid and non-assessable Common Stock
of the other class.
(d) The aggregate number of the Purchased Common Shares
(including the New Purchased Class B Common Shares (but excluding the
New Purchased Class A Common Shares) and the 378 shares of Class B
Common Stock issued to Xxxx Xxxxxxx upon the conversion of the
Convertible Xxxx Xxxxxxx Notes) is 5,170.8 which will constitute (i)
approximately 53.03% of the outstanding Common Stock and (ii)
approximately 35.88% of the Common Stock calculated on a fully-diluted
basis (as aforesaid in section 5.5(c)). The Company has reserved 5,170.8
shares of Class A Common Stock solely for issuance upon conversion of
the Purchased Common Shares (exclusive of the New Purchased Class A
Common Shares).
(e) Since February 26, 1998, no event or transaction has occurred
which, under the terms of the Warrants, requires any adjustment to the
Exercise Price or to the number or kind of securities or other property
deliverable upon exercise of the Warrants.
5.6. Financial Statements. You have been furnished with:
(a) the financial statements required to be delivered pursuant to
the Existing Securities Purchase Agreements, which financial statements
(subject, in the case of any unaudited financial statements, to the
absence of footnote disclosure and normal year-end and audit
adjustments) have been prepared in accordance with GAAP applied on a
consistent basis throughout the periods covered thereby and present
fairly in all material respects the financial position and the results
of operations and cash flows of the Person(s) purported to be covered
thereby as at the respective dates and for the respective periods
indicated in conformity with GAAP (subject, in the case of any unaudited
financial statements, to the absence of footnote disclosure and normal
year-end and audit adjustments); and
(b) the projections referred to on Exhibit 5.6(b) attached to the
Existing Securities Purchase Agreements, which projections were prepared
in good faith, are based upon assumptions that the Company believes are
reasonable and take into account all material information regarding the
matters set forth therein. Such projections represent a reasonable
estimate by the Company of the future financial performance of the
Company and its Subsidiaries. The Company does not presently anticipate
any material deviation
from such projections and the Company reasonably believes that the
results of operations reflected therein are attainable, provided that
the Company does not represent that the projected results of operations
will be achieved.
5.7. Changes: Solvency, etc. Since February 26, 1998: (a) there has been
no change in the assets, liabilities or financial condition of the Company or
any of its Subsidiaries, other than changes in the ordinary course of business
which have not been, either in any case or in the aggregate, materially adverse;
and (b) no condition or event has occurred which has resulted in, or could
reasonably be expected to result in, a Material Adverse Change. The Company and
its Subsidiaries are Solvent.
5.8. Tax Returns and Payments. The Company and its Subsidiaries have
filed all tax returns required by law to be filed and have paid all taxes,
assessments and other governmental charges levied upon their respective
properties, assets, income, receipts, franchises or sales, other than those not
yet delinquent and those, not substantial in aggregate amount, being or about to
be contested as provided in section 14.2(a) of the Existing Securities Purchase
Agreements. The income tax liability of the Company and its Subsidiaries (other
than the Bear Mountain Subsidiary, the Northstar Subsidiary and the Sierra
Subsidiary) is not currently being audited. The Company and its Subsidiaries
(other than the Bear Mountain Subsidiary, the Northstar Subsidiary and the
Sierra Subsidiary) have not executed any waiver or waivers that would have the
effect of extending the applicable statute of limitations in respect of income
tax liabilities. The charges, accruals and reserves in the financial statements
of the Company and its Subsidiaries in respect of taxes for all fiscal periods
are adequate in the opinion of the Company, and the Company knows of no unpaid
assessments for additional taxes for any fiscal period or of any basis therefor.
The Company and its Subsidiaries are indemnified under the Loon Mountain
Acquisition Agreement by the Merger Consideration Recipients (as such term is
defined in the Loon Mountain Acquisition Agreement) for certain liabilities in
respect of taxes (and all related penalties and other amounts) of the Loon
Mountain Subsidiary.
5.9. Funded Debt, Current Debt, Liens, Investments, Transactions with
Affiliates, Leases and Derivative Transactions. Exhibit 5.9 attached hereto
correctly describes as to the Company and each of its Subsidiaries (after giving
effect to the transactions consummated at the Closing):
(a) all of its Funded Debt and/or Current Debt to be outstanding
immediately following the Closing (other than that evidenced by the
Notes);
(b) all Liens to which any of its properties and assets will be
subject immediately following the Closing (other than those arising
under the Pledge Agreement and those of the character described in
section 14.9(c) of the Existing Securities Purchase Agreements);
(c) all of its Investments (and all agreements and commitments to
make Investments) to be owned or held (or in effect) immediately
following the Closing (other than Investments of the character described
in clauses (a), (b), (c), (e), (f), (g), (i), (j) and(k) of the
definition of Restricted Investments contained in the Existing
Securities Purchase Agreements);
(d) all transactions with Affiliates of the Company and its
Subsidiaries which were consummated during the 12-month period ended on
the date hereof or which it is now obligated or now intends to
consummate at any time in the future (including, without limitation, all
transactions involving consulting or management services provided (or to
be provided) to the Company or any of its Subsidiaries by any of their
respective Affiliates, other than the Xxxxxxx Management Agreement); and
(e) each lease, other than Capital Leases, under which it is
lessee or sublessee and is or shall be obligated to pay $50,000 or more
during any period of twelve consecutive months after the date hereof,
and, with respect to each such lease, the name of the lessor, the lessee
or sublessee, a general description of the property leased, the annual
Rental Obligations payable thereunder and the term thereof.
The Company is not a party to any Derivative Transaction.
5.10. Title to Properties: Liens; Leases. The Company and its
Subsidiaries have good and marketable title to all of their respective
properties and assets, free of all Liens (other than the Liens permitted under
section 14.9 of the Existing Securities Purchase Agreements), including, without
limitation, the properties and assets reflected in the financial statements
delivered pursuant to the Existing Securities Purchase Agreements, except for
the properties and assets disposed of in the ordinary course of business. The
Company and its Subsidiaries enjoy peaceful and undisturbed possession under all
material leases under which they operate, and all of such leases are valid,
subsisting and in full force and effect. None of such leases contains any
unusual or burdensome provision, which, in either case, has resulted in, or
could reasonably be expected to result in, a Material Adverse Change.
5.11. Litigation, etc. There is no action, proceeding or investigation
pending or, to the best knowledge of the Company, threatened (or any basis
therefor known to the Company), including, without limitation, those referred to
on Exhibit 5.11 attached to the Existing Securities Purchase Agreements and
Exhibit 5.11 attached hereto, which questions the validity of any of the
Operative Documents or any action taken or to be taken pursuant thereto or which
has resulted in, or could reasonably be expected to result in, a Material
Adverse Change. There is no outstanding judgment, decree or order, including,
without limitation, those referred to on Exhibit 5.11 attached to the Existing
Securities Purchase Agreements and Exhibit 5.11 attached hereto, which has
resulted in, or could reasonably be expected to result in, a Material Adverse
Change. Exhibit 5.11 attached to the Existing Securities Purchase Agreements and
Exhibit 5.11 attached hereto set forth a complete list of all material pending
and, to the best knowledge of the Company, threatened actions, proceedings and
investigations and all outstanding judgments, decrees and orders against or
affecting the Company and/or any of its Subsidiaries.
5.12. Valid and Binding Obligations; Compliance with Other Instruments,
Borrowing Restrictions, etc.
(a) This Agreement has been duly authorized, executed and
delivered by the Company and constitutes the valid and legally binding
obligation of the Company enforceable against the Company in accordance
with its terms (subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other similar laws affecting the enforcement of
creditors' rights generally and general equitable principles which may
limit the right to obtain the remedy of specific performance of
executory covenants and other equitable remedies). Each of the other
Operative Documents to which the Company is a party has been duly
authorized by the Company and, when executed and delivered, will
constitute the valid and legally binding obligation of the Company,
enforceable against it in accordance with its terms (subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other similar
laws affecting the enforcement of creditors' rights generally and
general equitable principles which may limit the right to obtain the
remedy of specific performance of executory covenants and other
equitable remedies).
(b) Neither the Company nor any of its Subsidiaries is in
violation of or in default under any term of its Organizational
Documents, or of any agreement, document, instrument, judgment, decree,
order, law, statute, rule or regulation applicable to it or any of its
properties and assets, in any way which has resulted in, or could
reasonably be expected to result in, a Material Adverse Change. Without
limiting the generality of the foregoing, the Company and each of its
Subsidiaries is in compliance with (and neither it nor any of its
predecessors in interest has received any notice to the contrary) and
there is no reasonable possibility of any liability of or any judgment,
decree or order binding upon or applicable to the Company and/or any of
its Subsidiaries or any of their respective properties and assets under
or on account of any Environmental Laws, except where the same has not
resulted in, and could not reasonably be expected to result in, a
Material Adverse Change.
(c) The execution, delivery and performance of and the
consummation of the transactions contemplated by the Operative Documents
will not violate or constitute a default under, or permit any Person to
accelerate or to require the prepayment of any Indebtedness of or the
repurchase or redemption of any securities issued by the Company or any
of its Subsidiaries or to terminate any lease or agreement of the
Company or any of its Subsidiaries pursuant to, or result in the
creation of any Lien (other than the Liens created by the Permitted Debt
Documents and by the Security Documents) upon any of the properties or
assets of the Company or any of its Subsidiaries pursuant to, any term
of its Organizational Documents or of any agreement, document,
instrument, judgment, decree, order, law, statute, rule or regulation
applicable to any of them or any of their respective properties and
assets.
(d) Neither the Company nor any of its Subsidiaries is a party to
or bound by or subject to any agreement, document, instrument, judgment,
decree, order, law, statute, rule or regulation (other than the
Operative Documents, the Permitted Debt Documents and laws, statutes,
rules or regulations affecting creditors or businesses generally(i) which
restricts its right or ability to incur Indebtedness, to issue securities
or to consummate the transactions contemplated hereby; (ii) under the terms
of or pursuant to which its obligation to pay all amounts due from it
and/or to perform all obligations imposed on it and/or to comply with the
terms applicable to it under any of the Operative Documents is in any way
restricted; (iii) which contains Restricted Payment Provisions or which
restricts its right or ability to make any distributions to its
stockholders or in respect of any of its Shares, to mortgage or dispose of
its properties, to consummate any merger, consolidation or acquisition, to
make Investments or Capital Expenditures, to enter into and perform leases,
to pay executive compensation and/or to conduct its business as now
conducted and now proposed to be conducted; or (iv) which has resulted in,
or could reasonably be expected to result in, a Material Adverse Change.
5.13. ERISA.
(a) The Company and each ERISA Affiliate have operated and
administered each Plan in compliance with all applicable laws except for
such instances of noncompliance which have not resulted in, and could
not reasonably be expected to result in, a Material Adverse Change.
Neither the Company nor any ERISA Affiliate has incurred any liability
pursuant to Title I or IV of ERISA or the penalty or excise tax
provisions of the Code relating to employee benefit plans (as defined in
section 3 of ERISA), and no event, transaction or condition has occurred
or exists that could reasonably be expected to result in the incurrence
of any such liability by the Company or any ERISA Affiliate, or in the
imposition of any Lien on any of the rights, properties or assets of the
Company or any ERISA Affiliate, in either case pursuant to Title I or IV
of ERISA or to such penalty or excise tax provisions or to section
401(a)(29) or 412 of the Code, other than such liabilities or Liens as
would not individually or in the aggregate result in a Material Adverse
Change.
(b) The present value of the aggregate benefit liabilities
under each of the Plans (other than Multiemployer Plans), determined as
of the end of such Plan's most recently ended plan year on the basis of
the actuarial assumptions specified for funding purposes in such Plan's
most recent actuarial valuation report, did not exceed the aggregate
current value of the assets of such Plan allocable to such benefit
liabilities. The term "benefit liabilities" has the meaning specified
in section 4001 of ERISA and the terms "current value" and "present
value" have the meaning specified in section 3 of ERISA.
(c) The Company and the ERISA Affiliates have not incurred
withdrawal liabilities (and are not subject to contingent withdrawal
liabilities) under section 4201 or 4204 of ERISA in respect of
Multiemployer Plans that individually or in the aggregate could result
in a Material Adverse Change. The Company and the ERISA Affiliates have
made all required contributions to Multiemployer Plans. Neither the
Company nor any ERISA Affiliate has incurred, nor would reasonably
expect to incur, any Withdrawal Liability upon a complete or partial
withdrawal from any Multiemployer Plan that individually or in the
aggregate could result in a Material Adverse Change. To the best of
the Company's knowledge, no Multiemployer Plan is, or is reasonably
expected to be, insolvent, in reorganization or terminated within the
meaning of Title IV of ERISA.
(d) Neither the Company nor any of its Subsidiaries has any
expected post retirement benefit obligation (determined in accordance
with Financial Accounting Standards Board Statement No. 106, without
regard to liabilities attributable to continuation coverage mandated by
section 4980B of the Code).
(e) The consummation of the transactions contemplated by the
Operative Documents will not involve any transaction that is subject to
the prohibitions of section 406(a) of ERISA or in connection with which
a tax could be imposed pursuant to section 4975(c)(l)(A)-(D) of the
Code. The representation by the Company in the first sentence of this
section 5.l3(e) is made in reliance upon and subject to the accuracy of
the representations made by each of the Purchasers in section 16 as to
the sources of the funds used to pay the purchase price of the
Securities to be purchased by each of them.
5.14. Consents, etc. No consent, approval or authorization of, or
declaration or filing with, or other action by, any Person (including, without
limitation, any creditor of or lender to the Company or any of its Subsidiaries
and any governmental authority) is required as a condition precedent to the
valid execution, delivery and performance of and the consummation of the
transactions contemplated by this Agreement and the other Operative Documents.
5.15. Proprietary Rights: Licenses. The Company and its
Subsidiaries have all Proprietary Rights and Licenses as are adequate for the
conduct of their respective businesses (including, without limitation, in
connection with the Acquired Businesses) as now conducted and now proposed to be
conducted, without any known conflict with the rights of others. Each such
Proprietary Right and License is in full force and effect, all material
obligations with respect thereto have been fulfilled and performed by the
Company or the applicable Subsidiary and there is no known infringement thereon
by any other Person that has resulted in, or could reasonably be expected to
result in, a Material Adverse Effect. No default in the performance or
observance by the Company and/or any of its Subsidiaries (or any of their
respective predecessors
in interest) of its obligations thereunder has occurred which permits, or after
notice of lapse of time or both would permit, the revocation or termination of
any material Proprietary Right or License or which has resulted in, or could
reasonably be expected to result in, a Material Adverse Change. Exhibit 5.15
attached to the Existing Securities Purchase Agreements contains a complete and
accurate list of all material Proprietary Rights and material Licenses owned or
held by the Company and its Subsidiaries.
5.16. Offer of Securities: Investment Bankers. Neither the Company nor
any of its Subsidiaries nor any Person acting on their behalf (a) has directly
or indirectly offered the Securities or any part thereof or any similar
securities for issue or sale to, or solicited any offer to buy any of the same
from, anyone other than the Purchasers, (b) has taken or will take any action
which would bring the issuance and sale of the Securities within the provisions
of Section 5 of the Securities Act or the registration or qualification
provisions of any applicable blue sky or other securities laws, (c) has dealt
with any broker, finder, commission agent or other similar Person in connection
with the sale of the Securities, or (d) is under any obligation to pay any
broker's fee, finder's fee or commission in connection with such sale. There are
no closing fees or similar amounts payable to Xxxxxx X. Xxxxxxx, Xx. or any of
his Affiliates in connection with the transactions contemplated hereby.
5.17. Government Regulation. Neither the Company nor any of its
Subsidiaries is subject to regulation under the Public Utility Holding Company
Act of 1935, the Federal Power Act or the Investment Company Act of 1940, each
as amended.
5.18. Labor Relations. No dispute involving employees of the Company or
any of its Subsidiaries or the relationship of the Company or any of its
Subsidiaries with any of its employees has resulted in, or could reasonably be
expected to result in, any Material Adverse Change.
5.19. Disclosure. Neither this Agreement nor any of the other Operative
Documents nor any other document, certificate or written statement furnished to
you by or on behalf of the Company or any of its Subsidiaries in connection with
the transactions contemplated by the Operative Documents (including, without
limitation, the Disclosure Documents), contains any untrue statement of a
material fact or omits to state a material fact necessary in order to make the
statements contained herein and therein not misleading in the light of the
circumstances under which such statements were made, it being understood that,
except as set forth in section 5.6, no representation or warranty is made with
respect to any projections or other prospective financial information. There is
no fact known to the Company (other than information concerning general economic
conditions known to the public generally) which has resulted in, or could
reasonably be expected to result in, a Material Adverse Change which has not
been set forth in this Agreement, the other Operative Documents and the other
documents, certificates and written statements referred to above in this section
5.19.
6. Use of Proceeds.
(a) The proceeds of the sale of the New Securities will be used
on the Closing Date to make the payments to the Persons and for the
purposes specified on Exhibit 6(a) attached hereto, and any remaining
balance of such proceeds will be used for general corporate purposes of
the Company and its Subsidiaries in accordance with the terms of the
Operative Documents.
(b) The Company does not own, and will not, and will not permit
any of its Subsidiaries to, directly or indirectly, use any part of the
proceeds of the sale of the Securities for the purpose of purchasing or
carrying any "margin stock" within the meaning of Regulation U (12 CFR
Part 221) of the Board of Governors of the Federal Reserve System
(herein called a "margin security") or for the purpose of reducing or
retiring any Indebtedness which was originally incurred to purchase or
carry any margin security or for any other purpose which might
constitute the transactions contemplated by the Operative Documents a
"purpose credit" within the meaning of said Regulation U or cause this
Agreement or any of the other Operative Documents to violate Regulation
U or any other regulation of the Board of Governors of the Federal
Reserve System, or the Exchange Act or any other applicable law,
statute, regulation, rule, order or restriction.
7. Covenants of the Company. The Company will duly perform and observe, for
the benefit of the holders of the New Securities (as well as for the benefit of
the holders of any of the other Securities, if applicable) each and all of the
applicable covenants and agreements set forth in the Existing Securities
Purchase Agreements, the Security Documents and the other Operative Documents
(as amended, modified and supplemented hereby), all of which covenants and
agreements are hereby incorporated herein by reference, provided that for
purposes of determining the Required Holders of any class of the Securities or
for purposes of effecting any amendment or waiver of any of the Operative
Documents, any Securities held by The Xxxxxxx Family Partnership or any of its
successors or assigns shall be deemed not to be outstanding.
8. Certain Defined Terms. Unless the context clearly requires otherwise,
all references in the Operative Documents (a) to "Notes" shall include the New
Notes, (b) to "Purchased Common Shares" shall include the New Purchased Common
Shares, (c) to "Warrants" shall include the New Warrants, (d) to the "Securities
Purchase Agreements" and the "other Operative Documents" (or any of them) shall
refer to such agreements, documents and instruments (or to those specified) as
amended, modified and supplemented hereby, (e) to "Secured Obligations" in the
Pledge Agreement or otherwise shall include all obligations and liabilities
arising under or related to the New Notes and (f) to "Secured Partes" in the
Pledge Agreement or otherwise shall include the holders of the New Notes. In
addition, this Agreement, the New Securities and the other agreements, documents
and instruments executed in connection herewith shall all constitute "Operative
Documents".
9. Waiver and Consent of Institutional Investors. Each of Xxxx Xxxxxxx and
CIBC Fund (a) hereby waives any Event of Default arising under the Existing
Securities Purchase Agreements solely on account of the failure of the Company
to obtain (and collaterally assign) the Xxxxxxx Key Man Insurance Policy,
provided that such waiver shall continue only until October 15, 1998, by which
date the Company hereby agrees to obtain (and collaterally assign) the same, and
(b) hereby consents, for purposes of section 3(a) of the Stockholders Agreement,
to the issuance of the New Purchased Common Shares and the New Warrants (and the
issuance of any Underlying Securities upon the exercise thereof) and waive, for
purposes of section 4 of the Stockholders Agreement, any preemptive right it
might have under such section 4 with respect thereto and agrees that there shall
be no anti-dilution adjustment under any of the Warrants on account thereof.
10. Ratification of Operative Documents. Each of the parties hereto hereby
ratifies and confirms each of the Operative Documents to which it is a party and
agrees that, after giving effect to the amendments, modifications and
supplements effected hereby, each of the same is in full force and effect, that
its obligations thereunder are its legal, valid and binding obligations
enforceable against it in accordance with its terms and that it has no defense,
whether legal or equitable, setoff or counterclaim, to the payment and
performance of such obligations. Without limiting the generality of the
foregoing, the Company hereby ratifies and confirms (and hereby re-grants) all
of the security interests and Liens granted by it pursuant to the Security
Documents to secure the Secured Obligations (as defined in the Security
Documents after giving effect to the amendments effected hereby).
11. Further Assurances. From time to time hereafter, the Company will
execute and deliver, or will cause to be executed and delivered, such additional
agreements, documents and instruments and will take all such other actions as
any Investor may reasonably request for the purpose of implementing or
effectuating the provisions of this Agreement and the other Operative Documents.
12. Expenses: Indemnity. Whether or not the transactions contemplated by
this Agreement shall be consummated, and without limiting the generality of the
provisions of section 21 of the Existing Securities Purchase Agreements, the
Company will pay or cause to be paid (or reimbursed, as the case may be) and
will defend, indemnify and hold each of the Investors harmless (on an after tax
basis) in respect of all costs, losses, expenses (including, without limitation,
the reasonable fees, expenses and disbursements of counsel) incurred by or
asserted against any Indemnitee in connection with the negotiation, execution,
delivery, performance and/or enforcement of this Agreement or any of the other
Operative Documents and/or the consummation of the transactions contemplated
hereby and thereby.
13. Communications; Amendments. All communications provided for herein shall
be given and shall be effective in accordance with section 23 of the Existing
Securities Purchase Agreements. All amendments of this Agreement and all waivers
of compliance herewith shall be in writing and shall be effected in accordance
with section 19 of the Existing Securities Purchase Agreements.
14. Survival of Agreements, Representations and Warranties, etc. All
agreements, representations and warranties contained herein or made in writing
by or on behalf of the Company in connection with the transactions contemplated
hereby or by any of the other Operative Documents shall be deemed to have been
relied upon by each of the Investors and shall survive the execution and
delivery of this Agreement and each of the other Operative Documents, the issue,
sale and delivery of the New Securities and payment therefor and any disposition
of the New Securities, whether or not any investigation at any time is made by
any of the Investors or on their behalf. All statements contained in any report,
memorandum, data or certificate delivered to any of the Investors by or on
behalf of the Company in connection with the transactions contemplated hereby or
by any of the other Operative Documents shall constitute representations and
warranties by the Company under this Agreement and shall be subject to the terms
of this section 14.
15. Successors and Assigns; Rights of Other Holders. This Agreement shall
bind and inure to the benefit of and be enforceable by each of the parties
hereto and their respective successors and assigns, including, without
limitation, each holder from time to time of any Securities who, upon acceptance
thereof, shall, without further action, be entitled to enforce the applicable
provisions and enjoy the applicable benefits hereof. The Company may not assign
any of its rights or obligations hereunder or under any of the other Operative
Documents without the written consent of the Required Holders of each class of
Securities then outstanding.
16. Purchase for Investment. Each Purchaser hereby makes severally as to
itself (and not jointly with the other Purchasers) the representations and
warranties set forth in section 26 of the
Existing Securities Purchase Agreements with reference to the New Securities to
be purchased by it with the same force and effect as if such section was set
forth herein in full.
17. Governing Law. This Agreement, including the validity hereof and the
rights and obligations of the parties hereunder, and all amendments and
supplements hereof and all waivers and consents hereunder, shall be construed in
accordance with and governed by the domestic substantive laws of The
Commonwealth of Massachusetts without giving effect to any choice of law or
conflicts of law provision or rule that would cause the application of the
domestic substantive laws of any other jurisdiction.
18. Miscellaneous. The headings in this Agreement and in each of the other
Operative Documents are for purposes of reference only and shall not limit or
otherwise affect the meaning hereof or thereof. This Agreement (together with
the other Operative Documents) embodies the entire agreement and understanding
among the Investors and the Company and supersedes all prior agreements and
understandings relating to the subject matter hereof. This Agreement may be
executed in any number of counterparts and by the parties hereto on separate
counterparts but all such counterparts shall together constitute but one and the
same instrument.
[The remainder of this page is intentionally left blank.]
If you are in agreement with the foregoing, please sign the form of
agreement on the accompanying counterparts of this letter, whereupon this letter
shall become a binding agreement under seal between you and the Company. Please
then return one of such counterparts to the Company.
Very truly yours,
BOOTH CREEK SKI GROUP, INC.
By:/s/ XXXXXX X. XXXXXXX, XX.
-----------------------------
Xxxxxx X. Xxxxxxx, Xx. (Title)
President
The foregoing Agreement is hereby agreed to as of the date thereof.
XXXX XXXXXXX MUTUAL LIFE
INSURANCE COMPANY
By: /s/ XXXXXX X. XXXXX
----------------------------
Xxxxxx X. Xxxxx (Title)
Senior Investment Officer
CIBC WG ARGOSY MERCHANT FUND 2, L.L.C.
By: /s/ XXX XXXXXX
---------------------
Xxx Xxxxxx (Title)
Managing Director
BOOTH CREEK PARTNERS LIMITED II. L.L.L.P.
By: /s/ XXXXXX X. XXXXXXX, XX.
------------------------------------------
Xxxxxx X. Xxxxxxx, Xx., a General Partner
XXXXXXX MEZZANINE PARTNERS L.P.
By: Xxxxxxx Mezzanine Investment LLC,
its general partner
By: Xxxx Xxxxxxx Mutual Life Insurance Company,
its investment manager
--------------------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Investment Officer
