EXECUTIVE EMPLOYMENT AGREEMENT
EXECUTIVE EMPLOYMENT AGREEMENT, made as of November 7, 2006 by and
between STEAMBOAT SKI & RESORT CORPORATION, a Delaware corporation (the
"Company"), and ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (the "Executive").
WHEREAS, the Company desires to continue to employ the Executive and the
Executive desires to continue to be so employed, on the terms and subject to the
conditions set forth in this agreement (the "Agreement");
NOW, THEREFORE, in consideration of the mutual covenants set forth
herein and for other good and valuable consideration the parties hereto hereby
agree as follows:
1. Employment: Term. The Company hereby agrees to continue to employ the
Executive, and the Executive agrees to continue to be so employed by the
Company, upon the terms and subject to the conditions set forth herein,
commencing on October 1, 2006 (the "Effective Date") and ending on July 31, 2007
unless earlier terminated in accordance with Section 4 of this Agreement;
provided, however, that upon the consummation of a Change in Control (as defined
in Section 4(f) hereof), the term shall be extended for a period of two (2)
years following the Change in Control (the initial period together with any such
extension shall be referred to hereinafter as the "Term").
2. Position: Conduct.
(a) During the Term, the Executive will hold the title and office of, and
serve in the position of President of the Company (unless the Executive consents
to such other title). The Executive shall undertake the responsibilities and
exercise the authority customarily performed, undertaken and exercised by
persons situated in a similar executive capacity, and shall perform such other
specific duties and services as the Board of Directors (the "Board") shall
reasonably request consistent with the Executive's position.
(b) During the Term, the Executive agrees to devote his full business time
and attention to the business and affairs of the Company and to faithfully and
diligently perform, to the best of his ability, all of his duties and
responsibilities hereunder. Nothing in this Agreement shall preclude the
Executive from devoting reasonable time and attention to (i) serving, with the
written approval of the Board as a director, trustee or member of any committee
of any organization, (ii) engaging in charitable and community activities and
(iii) managing his personal investments and affairs and (iv) maintaining his
ownership and/or controlling interest in the Alpine Traders Ski Shop located in
West Dover, Vermont; provided that the activities set forth in clause (i), (ii)
and (iii) do not involve any material conflict of interest with the interests of
the Company or, individually or collectively, interfere materially with the
performance by the Executive of his duties and responsibilities under this
Agreement.
(c) The Executive's office and place of rendering his services under this
Agreement shall be in the principal executive offices of the Company, which
shall be in the Steamboat Springs, Colorado area.
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3. Salary: Additional Compensation: Perquisites and Benefits.
(a) Salary. During the Term, the Company shall pay the Executive a base
salary (the "Base Salary") at an annual rate of not less than $284,313.12.
Subject to annual review, such Base Salary may be increased from time to time.
Base Salary shall be paid in periodic installments in accordance with the
Company's standard practice, but not less frequently than semi-monthly.
(b) Bonus. For each fiscal year (August 1 through July 31) during the Term,
the Executive shall be eligible to receive a bonus from the Company (the "Annual
Bonus"). The award and amount of the Annual Bonus shall be contingent upon the
Company's achievement of predefined operating or performance goals and other
criteria established by the Compensation Committee of the Board, which shall
give the Executive the opportunity to earn an Annual Bonus equal to 20% of his
Base Salary.
(c) Change in Control Bonus. Upon the consummation of a Change in Control
(as such term is defined in Section 4(f) hereof) that occurs during the Term,
the Company shall pay the Executive a cash award (the "Change in Control Bonus")
in an amount calculated pursuant to the terms of the November 7, 2006 "Change in
Control Bonus Award Letter" from the Compensation Committee of the Board of
Directors of American Skiing Company (the "Compensation Committee") to the
Executive. If a Change in Control occurs during the Term, the Change in Control
Bonus shall be payable on the later of (i) thirty (30) days following the
consummation of the Change in Control and (ii) January 1, 2007.
(d) Employee Benefits. During the Term, the Executive shall participate in
all plans maintained for the benefit of the Company's employees on the same
basis and subject to the same qualifications as other senior executive officers.
(e) Equity. The Executive has previously been granted options to purchase
shares of American Skiing Company common stock. The terms and conditions of such
option shall continue to be governed by the Stock Option Agreements executed by
and between American Skiing Company and the Executive dated as of January 1,
2000, October 22, 1998, and November 15, 1997.
(f) Expenses. The Company shall reimburse the Executive, in accordance with
its standard policies from time to time in effect, for all out-of-pocket
business expenses as may be incurred by the Executive in the performance of his
duties under this Agreement.
(g) Vacation. The Executive shall be entitled to vacation time to be
credited and taken in accordance with the Company's policy from time to time in
effect for senior executives, which in any event shall not be less than a total
of four (4) weeks per calendar year.
4. Termination and Severance.
(a) Death or Disability. The Term shall terminate immediately upon the
Executive's death or upon thirty (30) days prior written notice by the Company,
in the case of a determination of the Executive's Disability. As used herein the
term "Disability" means the Executive's inability to perform his duties and
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responsibilities under this Agreement for a period of more than 60 consecutive
days, or for more than 120 days, whether or not continuous, during any 180-day
period, due to physical or mental incapacity or impairment. A determination of
Disability will be made by a physician reasonably satisfactory to both the
Executive and the Company and paid for by the Company whose decision shall be
final and binding on the Executive and the Company; provided that if the parties
cannot agree as to a physician, then each shall select and pay for a physician
and these two together shall select a third physician whose fee shall be borne
equally by the Executive and the Company and whose determination of Disability
shall be binding on the Executive and the Company.
If the Term is terminated upon the Executive's death or Disability, the
Company shall pay to the Executive's estate or the Executive, as the case may
be, a lump sum payment equal to (i) the Executive's Base Salary through such
termination date, (ii) a pro rata portion of the Executive's Annual Bonus with
respect to the fiscal year in which the termination occurred plus (iii) any
accrued but unpaid vacation through the date of such termination.
(b) Termination for Cause. The Term may be terminated by the Company upon
ten (10) days written notice to the Executive following the occurrence of any
event constituting "Cause" as defined below. If the Term is terminated by the
Company for Cause, the Company will pay the Executive an aggregate amount equal
to the Executive's accrued and unpaid Base Salary and vacation pay through the
date of such termination. For purposes of this Agreement, "Cause" shall mean the
Executive's (i) failure or refusal to perform or observe any of his duties,
responsibilities or obligations set forth in this Agreement; (ii) any willful
and intentional act of the Executive involving malfeasance, fraud, theft,
misappropriation of funds, embezzlement or dishonesty affecting the Company; or
(iii) the Executive's conviction of, or a plea of guilty or nolo contendere to,
an offense which is a felony in the jurisdiction involved or any lesser crime
involving Company property.
(c) Termination by the Executive without Good Reason. If the Term is
terminated by the Executive other than because of death, Disability or for Good
Reason (as such term is defined in Section 4(f) hereof), the Company shall pay
to the Executive an aggregate amount equal to the Executive's accrued and unpaid
Base Salary and vacation through the date of such termination.
(d) Termination By the Company without Cause (other than on account of
death or Disability) or by the Executive for Good Reason. Subject to Section
4(e) hereof, if the Term is terminated by the Company without Cause (other than
by reason of death or Disability), or if the Executive terminates the Term for
Good Reason (as defined below), the Company shall pay the Executive a lump sum
payment within thirty (30) days following such termination equal to one (1)
times the Executive's Annual Base Salary as in effect as of the date of such
termination.
(e) INTENTIONALLY OMITTED.
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(f) Definitions. For purposes of this Agreement, the following terms shall
have the meaning set forth in this section 4(f):
(i) "Good Reason" shall mean the occurrence of any of the following,
without the prior written consent of the Executive: (A) a material reduction in
the Executive's compensation, (B) assignment to the Executive of duties
materially inconsistent with the Executive's position as described in Section
2(a) hereof or (C) any significant diminution in the Executive's duties or
responsibilities, other than in connection with the termination of the
Executive's employment for Cause, Disability or as a result of the Executive's
death or by the Executive other than for Good Reason;
(ii) "Change in Control" shall mean the occurrence of any one of the
following events:
(A) the acquisition (other than from the Company) by any "Person"
(as the term is used for purposes of Section 13(d) or 14(d) of the Securities
Exchange Act of 1934 (the "Exchange Act")) of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of fifty (50%) percent
or more of the combined voting power of the Company's then outstanding voting
securities, other than any Person holding fifty (50%) percent or more of such
combined voting power on the date hereof; or
(B) approval by stockholders of the Company of (a) a merger or
consolidation involving the Company in which the stockholders of the Company
immediately before such merger or consolidation do not, as a result of such
merger or consolidation, own, directly or indirectly, more than fifty (50%)
percent of the combined voting power of the then outstanding voting securities
of the corporation resulting from such merger or consolidation in substantially
the same proportion as their ownership of the combined voting power of the
securities of the Company outstanding immediately before such merger or
consolidation or (b) a complete liquidation or dissolution of the Company or an
agreement for the sale or other disposition of all or substantially all of the
assets of the Company, subject to the consummation of the events described in
clauses (a) and (b).
(g) Mitigation. Under no circumstances shall the Executive, upon
termination of his employment hereunder, be required to seek alternative
employment and, in the event the Executive does secure other employment, no
other compensation or other benefits received in respect of such employment
shall be set-off or in any other way limit or reduce the obligations of the
Company under this Section 4.
5. Confidential Information.
The Executive acknowledges that the Company and its subsidiaries or
affiliated ventures ("Company Affiliates") own and have developed and compile,
and will in the future own, develop and compile certain Confidential Information
(as defined below) and that during the course of his rendering services
hereunder Confidential Information will be disclosed to the Executive by the
Company Affiliates. The Executive hereby agrees that, during the Term and for a
period of three years thereafter, he will not use or disclose, furnish or make
accessible to anyone, directly or indirectly, any Confidential Information of
Company Affiliates.
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As used herein, the term "Confidential Information" means any trade
secrets, confidential or proprietary information, or other knowledge, know-how,
information, documents or materials, owned developed or possessed by any Company
Affiliate pertaining to its businesses the confidentiality of which such company
takes reasonable measures to protect, including, but not limited to, trade
secrets, techniques, know-how (including designs, plans, procedures, processes
and research records), software, computer programs, innovations, discoveries,
improvements, research, developments, test results, reports, specifications,
data, formats, marketing data and business plans and strategies, agreements and
other forms of documents, expansion plans, budgets, projections, and salary,
staffing and employment information. Notwithstanding the foregoing, Confidential
Information shall not in any event include information which (i) was generally
known or generally available to the public prior to disclosure to the Executive,
(ii) becomes generally known or generally available to the public subsequent to
its disclosure to the Executive through no wrongful act of the Executive, (iii)
is or becomes available to the Executive from sources other than Company
Affiliates whereby such sources are not known to the Executive to be under any
duty of confidentiality with respect thereto, (iv) the Executive is required to
disclose by applicable law or regulation or by order of any court or federal,
state or local regulatory or administrative body (provided that the Executive
provides the Company with prior notice of the contemplated disclosure and
reasonably cooperates with the Company, at the Company's sole expense, in
seeking a protective order or other appropriate protection of such information)
or (v) known to Executive prior to his employment with the Company.
6. Non-Competition/Nonsolicitation.
(a) The Executive recognizes and acknowledges that the services to be
performed by him hereunder are special, unique and extraordinary and the
Executive further acknowledges and recognizes the highly competitive nature of
the business of the Company. The Executive understands that the provisions of
this Section 6 may limit the Executive's ability to earn a livelihood in a
business similar to the business of the Company but nevertheless agrees and
hereby acknowledges that (i) such provisions do not impose a greater restraint
than is necessary to protect the goodwill or other business interests of the
Company, (ii) such provisions contain reasonable limitations as to time and
scope of activity to be restrained, (iii) such provisions are not harmful to the
general public, (iv) such provisions are not unduly burdensome to the Executive,
and (v) the consideration provided hereunder is sufficient to compensate the
Executive for the restrictions contained in such provisions. In consideration
thereof and in light of the Executive's education, skills and liabilities, the
Executive agrees that the Executive will not assert in any forum that such
provisions prevent the Executive from earning a living or otherwise are void or
unenforceable or should be held unenforceable.
Accordingly, the Executive agrees that during the Employment Term and for a
period of six (6) months following termination of employment, the Executive will
not, directly or indirectly, as an officer, director, stockholder, partner,
member, associate, employee, consultant, owner, agent, creditor, co-venturer or
otherwise, become or be financially interested in or be associated with any
other person or entity, in any state in the United States in which the Company
has operations at the date of his termination of employment, in a "Competitive
Business" with that of the Company at such time. For purposes of the Agreement,
a Competitive Business shall mean any ski resort within a 100 mile radius of the
Steamboat Ski and Resort facilities. The Executive's ownership of shares in
Company Affiliates and the ownership, directly or indirectly, of not more than
five percent (5%) of the issued and outstanding stock of any corporation, the
shares of which are regularly traded on a national securities exchange or in the
over-the-counter market, shall not in any event be deemed to be a violation of
the provisions of this Section 6.
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(b) During the Employment Term and for a period of twelve (12) months
thereafter, the Executive shall not (i) directly or indirectly, (A) solicit or
encourage any employee of the Company to leave the employment of the Company, or
(B) hire any such employee who has left the employment of the Company (other
than as a result of the termination of such employment by the Company) within
six (6) months after the termination of such employee's employment with the
Company, and (ii) directly or indirectly, solicit or encourage to cease to work
with the Company any consultant then under contract with the Company.
(c) It is expressly understood and agreed that although the Executive and
the Company consider the restrictions contained in this Section 6 to be
reasonable, if a final judicial determination is made by a court of competent
jurisdiction that the time or territory or any other restriction contained in
the Agreement is an unenforceable restriction against the Executive, the
provisions of the Agreement shall not be rendered void but shall be deemed
amended to apply as to such maximum time and territory and to such maximum
extent as such court may judicially determine or indicate to be enforceable.
Alternatively, if any court of competent jurisdiction finds that any restriction
contained in the Agreement is unenforceable, and such restriction cannot be
amended so as to make it enforceable, such finding shall not affect the
enforceability of any of the other restrictions contained herein.
7. Specific Performance.
(a) The Executive acknowledges that the services to be rendered by him
hereunder are of a special, unique, extraordinary and personal character and
that the Company would sustain irreparable harm in the event of a violation by
the Executive of Section 5 or 6 of this Agreement. Therefore, in addition to any
other remedies available, the Company shall be entitled to specific enforcement
and/or injunction from any court of competent jurisdiction restraining the
Executive from committing or continuing any such violation of this Agreement
without proving actual damages or posting a bond or other security. Nothing
herein shall be construed as prohibiting the Company from pursuing any other
remedies available to it for such breach or threatened breach, including the
recovery of damages.
(b) If any of the restrictions on activities of the Executive contained in
Section 6 hereof shall for any reason be held by a court of competent
jurisdiction to be excessively broad, such restrictions shall be construed so as
thereafter to be limited or reduced to be enforceable to the maximum extent
comparable with the applicable law as it shall then appear; it being understood
that by the execution of this Agreement the parties hereto regard such
restrictions as reasonable and compatible with their respective rights.
8. Withholding. The parties agree that all payments to be made to the
Executive by the Company pursuant to the Agreement shall be subject to all
applicable withholding obligations of the Company.
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9. Notices. All notices required or permitted hereunder shall be in writing
and shall be deemed given and received when delivered personally, four (4) days
after being mailed if sent by registered or certified mail, postage pre-paid, or
by one (1) day after delivery if sent by air courier (for next-day delivery)
with evidence or receipt thereof or by facsimile with receipt confirmed by the
addressee. Such notices shall be addressed respectively:
If to the Executive, to:
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
If to the Company, to:
Steamboat Ski & Resort Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Board of Directors
With a copy to:
American Skiing Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: General Counsel
or to any other address of which such party may have given notice to the other
parties in the manner specified above.
10. Miscellaneous.
(a) This Agreement is a personal contract calling for the provisions of
unique services by the Executive, and the Executive's rights and obligations
hereunder may not be sold, transferred, assigned, pledged or hypothecated by the
Executive. The rights and obligations of the Company hereunder will be binding
upon and run in favor of their respective successors and assigns.
(b) This Agreement shall be governed by and construed and enforced in
accordance with the internal laws of the State of Delaware, without regard to
conflict of laws principles.
(c) The headings of the various sections of this Agreement are for
convenience of reference only and shall not define or limit any of the terms or
provisions hereof.
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(d) The provisions of this Agreement that by their terms call for
performance subsequent to the expiration or termination of the Term shall
survive such expiration or termination.
With the exception of (i) any Stock Option Agreements entered into by and
between the Executive and American Skiing Company and (ii) the November 7, 2006
"Change in Control Bonus Award Letter" from the Compensation Committee to the
Executive, this Agreement constitutes the entire agreement of the parties hereto
with respect to the subject matter hereof and supersedes all other prior
agreements and undertakings, both written and oral, among Executive, the Company
and/or American Skiing Company with respect to the subject matter hereof
(including without limitation any letter agreement or other correspondence
entered into prior to the Effective Date), all of which shall be terminated on
the Effective Date. Without limiting the generality of the preceding sentence,
the Executive, the Company and American Skiing Company agree and acknowledge
that the Executive no longer has any rights under the American Skiing Company
Phantom Equity Plan. In addition, the parties hereto hereby waive all rights
such party may have under all other prior agreements and undertakings, both
written and oral, between the parties hereto, with respect to the subject matter
hereof.
[SIGNATURE PAGE FOLLOWS]
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EXECUTIVE
By: /s/▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
STEAMBOAT SKI & RESORT CORPORATION
By: /s/▇▇▇▇▇▇▇ ▇. Fair
-----------------------------
▇▇▇▇▇▇▇ ▇. Fair
Its: Chief Executive Officer