AMENDMENT NO. 1 TO THE STOCKHOLDERS' AGREEMENT
AMENDMENT NO. 1 TO THE STOCKHOLDERS' AGREEMENT (the "Amendment"), dated July 31,
2000, among OAK HILL CAPITAL PARTNERS, L.P., a Delaware limited partnership
("Oak Hill"), OAK HILL CAPITAL MANAGEMENT PARTNERS, L.P., a Delaware limited
partnership, OAK HILL SECURITIES FUND, L.P., a Delaware limited partnership, OAK
HILL SECURITIES FUND II, L.P., a Delaware limited partnership, and OHCP Ski,
L.P., a Delaware limited partnership (together with Oak Hill, the
"Stockholders"), LESLIE B. OTTEN ("Mr. Otten") and AMERICAN SKIING COMPANY, a
Delaware corporation ("ASC"), amending that certain Stockholders' Agreement,
dated August 6, 1999 (the "Stockholders' Agreement"), among Oak Hill, Mr. Otten,
ASC and the other parties identified in Annex A thereto. Defined terms used
herein and not otherwise defined will have the meanings assigned to them in the
Stockholders' Agreement.
WHEREAS, it is the desire of the parties to amend the Stockholders' Agreement in
the manner specified in this Amendment;
WHEREAS, in connection with this Amendment, the number of Otten Directors shall
be reduced from four to two and the vacancies shall be filled by two Stockholder
Directors; and
WHEREAS, the board of directors of ASC, including all Independent Common Stock
directors, has approved this Amendment;
NOW, THEREFORE, in consideration of the premises and the mutual agreements and
covenants hereinafter set forth, and for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Stockholders, ASC
and Mr. Otten agree as follows:
ARTICLE I
AMENDMENTS TO THE STOCKHOLDERS' AGREEMENT
A. Section 1.01. The definition of Stockholder Director in Section 1.01
shall be amended and restated in its entirety to read as follows:
" 'Stockholder Director' means a Director designated by the
Stockholders pursuant this Agreement or elected by the holders of the
Series B Preferred pursuant to the Articles of Incorporation, except
that, for so long as Mr. Otten is the Company's chief executive
officer, no employee of the Company or its subsidiaries may be
designated a Stockholder Director without the consent of Mr. Otten."
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B. Section 2.01(b). Section 2.01(b) of the Agreement shall be amended and
restated in its entirety to read as follows:
"Each of Mr. Otten and the Stockholders shall vote all Restricted
Securities Beneficially Owned by him or it, as the case may be, to
cause, and the parties hereto each shall otherwise use its best
efforts to cause, there to be (i) six Stockholder Directors for so
long as the Stockholders Beneficially Own at least 80% of the number
of outstanding shares of Common Stock (on a Fully Diluted Basis) that
it owns on the date of this Amendment; (ii) five Stockholder Directors
for so long as the Stockholders Beneficially Own at least 70% of the
number of outstanding shares of Common Stock (on a Fully Diluted
Basis) that it owns on the date of this Amendment; (iii) four
Stockholder Directors for so long as the Stockholders Beneficially Own
at least 60% of the number of outstanding shares of Common Stock (on a
Fully Diluted Basis) that it owns on the date of this Amendment; (iv)
three Stockholder Directors for so long as the Stockholders
Beneficially Own at least 40% of the number of outstanding shares of
Common Stock (on a Fully Diluted Basis) that it owns on the date of
this Amendment; (v) two Stockholder Directors for so long as the
Stockholders Beneficially Own at least 25% of the number of
outstanding shares of Common Stock (on a Fully Diluted Basis) that it
owns on the date of this Amendment; and (vi) one Stockholder Director
for so long as the Stockholders Beneficially Own at least 5% of the
number of outstanding shares of Common Stock (on a Fully Diluted
Basis) that it owns on the date of this Amendment."
C. Section 2.01(c). Section 2.01(c) of the Agreement shall be amended and
restated in its entirety to read as follows:
"Each of Mr. Otten and the Stockholders shall vote all Restricted
Securities Beneficially Owned by him or it, as the case may be, to
cause, and the parties hereto each shall otherwise use its best
efforts to cause, there to be (i) two Otten Directors for so long as
Mr. Otten Beneficially Owns at least 15% of the outstanding shares of
Common Stock (on a Fully Diluted Basis) and (ii) one Otten Director
for so long as Mr. Otten Beneficially Owns at least 5% of the
outstanding shares of Common Stock (on a Fully Diluted Basis)."
D. Section 2.01(d). Section 2.01(d) of the Agreement shall be amended to
delete the proviso in its entirety.
E. Section 2.02(d). Section 2.02(d) of the Agreement shall be amended as
such that the parenthetical beginning on the fourth line after the words "Otten
Directors" and ending on the fifth line before the word "shall" shall be deleted
and shall instead read as follows:
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..." (comprised of those Otten directors designated by Otten)"...
F. Section 2.02(e). A new section 2.02(e) shall be added after Section
2.02(d) and shall read as follows:
"Notwithstanding the provisions of Section 2.02(d), the vacancies
created by reducing the number of Otten Directors to two pursuant to
this Amendment will be filled by two individuals designated by the
Stockholder Directors."
G. Section 2.04(c). Section 2.04(c) shall be amended and restated in its
entirety to read as follows:
"For so long as there shall be at least one Otten Director and Mr.
Otten is the Company's chief executive officer, each of the parties
hereto shall use its best efforts to cause (i) Mr. Otten to be a
member of the Nominating Committee; (ii) Mr. Otten to be a member of
the Executive Committee; (iii) Mr. Otten to serve as a member of the
board of directors of ASC Utah and American Skiing Company Resort
Properties, Inc. or any Material Subsidiary and (iv) Mr. Otten to
serve as a member of each committee of the board of directors of the
Material Subsidiaries; provided, that, if any applicable law or
regulation of the NYSE (or other exchange on which the Common Stock is
listed) shall prohibit the Board from appointing Mr. Otten to serve on
any committee, this Agreement shall not require Mr. Otten to serve on
such committee."
H. Section 4.02(b)(ii). Section 4.02(b)(ii) shall be amended and restated
in its entirety to read as follows:
"(ii) to Persons (or any other reasonably foreseeable subsequent
transferee) other than Permitted Transferees, who, to the knowledge of
any of the Stockholders, Mr. Otten or their Permitted Transferees, as
the case may be, following such Transfer would Beneficially Own 10% or
more of the outstanding shares of Common Stock (on a Fully Diluted
Basis), unless such Transfer has been approved by the Board, including
the approval by a majority of the Independent Common Stock directors;
however, the approval of a majority of the Independent Common Stock
directors will not be required if the public shareholders of the
Company are offered an opportunity to participate in such Transfer on
equivalent terms (it being understood that such terms shall be deemed
equivalent if the value of the consideration received by the
Stockholders for its Series B Preferred does not exceed the greater of
(i) the Change of Control Price (as defined in the Certificate of
Designation) of the Series B Preferred and (ii) the value of the
consideration payable in respect of the Conversion Stock)."
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I. Section 4.02(b)(iii)(A). Section 4.02(b)(iii)(A) shall be amended by
adding the following language at the beginning of clause (iii)(A) and prior to
the words "that is a direct competitor":
..."except as may be approved by the Board,"...
J. Section 4.02(b). Section 4.02(b) shall be amended by adding the
following sentence at the end of the paragraph:
"Subsections (ii) and (iii)(A) of this Section 4.02(b) shall not apply
to any Transfers of Restricted Securities by Mr. Otten, except that
Mr. Otten shall not Transfer any Restricted Securities to a Person (or
other reasonably foreseeable subsequent transferee) who (i) to the
knowledge of Mr. Otten or his Permitted Transferees following such
Transfer would Beneficially Own 10% or more of the outstanding shares
of Common Stock (on a Fully Diluted Basis) and (ii) is a direct
competitor in the ownership and operating of ski resorts on a national
scale."
K. Section 4.03(a). The last sentence of Section 4.03(a) will be amended
and restated in its entirety to read as follows:
"With respect to clause (i) above, any increase in Beneficial
Ownership by the Stockholders and any Stockholder Permitted
Transferees resulting from (u) any Accretion Amounts (as such term is
defined in the Certificate of Designation), (v) any dividend in the
form of Common Stock made with respect to the Conversion Stock, (w)
any repurchase of Common Stock by the Company, (x) any purchase or
series of related purchases by any Stockholder of up to 1.5 million
additional shares of Common Stock, (y) any purchase by any Stockholder
of shares of Class A Common Stock or Common Stock owned by Mr. Otten,
and (z) the issuance of the Warrants (the "Warrants") pursuant to the
terms of the Securities Purchase Agreement, dated as of July 31, 2000,
among Oak Hill, the Company and the other parties signatory thereto
and the shares of Common Stock issued upon exercise thereof shall not
be included in the Maximum Stockholder Stock Ownership Percentage;
provided, however, that in all cases, the Stockholders may acquire
securities of the Company pursuant to Section 4.05 or pursuant to the
issuance of any dividends on Common Stock."
L. Section 4.04. Section 4.04 shall be amended by adding the following
language after the words "Article IV":
... "including pursuant to the Warrants"....
M. Section 4.05(c)(ii). Section 4.05(c)(ii)shall be amended by adding the
following language before the words "the issuance of warrant shares":
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..."the Warrants or the shares of Common Stock issued upon exercise of
the Warrants or..."
N. Section 4.06. A new section 4.06 will be added to the Agreement and
will read as follows:
"The provisions of the Stockholders' Agreement will terminate for the
Stockholders or Mr. Otten, as the case may be, at the time when such
party transfer or sells its holdings such that it Beneficially Owns
less than 5% of the number of shares of outstanding Common Stock (on a
Fully Diluted Basis) that it owns on the date of this Amendment."
O. All references in the Agreement to "the Agreement" shall be deemed to
be references to the Agreement as amended by this Amendment.
P. Section 7.03(a). Section 7.03(a) of the Agreement shall be amended to
require that a copy of all notices required to be sent "to the Company or Mr.
Otten" under Section 7.03 shall also be sent to:
Oak Hill Capital Management, Inc.
Park Avenue Tower
65 East 55th Street
New York, NY 10022
Telecopy: 212-754-5685
Attention: Steven B. Gruber
Bradford E. Bernstein
ARTICLE II
MISCELLANEOUS
A. This Amendment is entered into by the parties hereto pursuant to
Section 7.09 of the Agreement.
B. All of the other provisions of the Agreement not specifically amended
by this Amendment shall not be deemed to be affected by this Amendment (other
than as described in Article I, Section O hereof) and shall remain in full force
and effect.
C. Article VII of the Agreement shall be incorporated by reference into
this Amendment and shall be deemed to be a part hereof.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first above written.
AMERICAN SKIING COMPANY
By: /s/ Leslie B. Otten
---------------------------------
Name: Leslie B. Otten
Title: President
LESLIE B. OTTEN
/s/ Leslie B. Otten
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OAK HILL CAPITAL PARTNERS, L.P.
By: OHCP GenPar, L.P.,
its general partner
By: OHCP MGP, LLC,
its general partner
By: /s/ Steven B. Gruber
----------------------------------
Name: Steven B. Gruber
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/ Steven B. Gruber
----------------------------------
Name: Steven B. Gruber
Title: Vice President
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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/ Scott D. Krase
----------------------------------
Name: Scott D. Krase
Title: Vice President
OAK HILL SECURITIES FUND II, L.P.
By: Oak Hill Securities GenPar, L.P.,
its General Partner
By: Oak Hill Securities MGP, Inc.,
its General Partner
By: /s/ Scott D. Krase
----------------------------------
Name: Scott D. Krase
Title: Vice 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/ Steven B. Gruber
----------------------------------
Name: Steven B. Gruber
Title: Vice President
