ASC pays $1 million for restructuring deal


— American Skiing Company's real estate division agreed to pay an additional $1 million this month to Textron Financial Corp. as part of the restructuring of more than $40 million in loans for which ASC's Grand Summit Resort Properties was already in default.

The terms of the restructuring are revealed in documents filed with the Securities and Exchange Commission earlier in October.

ASC's Chief Executive Officer B.J. Fair said the agreement relaxes requirements affecting the rate at which $42.6 million in outstanding debt must be paid back. The $1 million will be paid in installments. The restructured loan package also leaves in place a secondary $10 million loan, which serves as a line of credit dedicated to revitalizing both sales and revenue stream at the Steamboat Grand Resort Hotel and Conference Center.

The $10 million subordinated loan was already drawn down to complete construction of the hotel. It will also be the source of $300,000 the company has promised toward planned improvements to Mount Werner Circle and a transportation center that serves the base of the Steamboat Ski Area. The Steamboat Springs City Council voted in September to find ASC in default on its agreement to help fund the improvements, which were a condition of approval for construction of the hotel in 1998.The hotel was completed in October 2000.

ASC senior financial analyst Erik Preusse said Thursday the interest rates being charged the company on its loans from Textron remain unchanged after the restructuring. ASC agrees to pay 20 percent interest on monies advanced from the $10 million line of credit.

Of that total interest, half is to be paid in cash on a monthly basis and half will be due in September 2004 when the sum of all advances against the $10 million come due.

The outstanding$42.6 million is split, with a portion of the debt being attributable to the construction of the Steamboat Grand, and the balance to the Canyons Grand Summit at ASC's ski resort, The Canyons, near Park City, Utah.

The Canyons debt carries an interest rate of prime plus 2.5 percent and matures March 31, 2003, Preusse said. The debt on the Steamboat Grand carries an interest rate of prime plus 3.5 percent and matures May 31, 2004.

Company officials say half of the quartershares at the Steamboat Grand Hotel and Conference Center remain unsold. The number of outstanding quartershares at the Canyons Grand Summit in Utah is about 25 percent. Proceeds at the hotels secure the indebtedness.

The terms of the renegotiated financial package allow ASC officials to seek "advances" against the new subordinated loan.

ASC announced the restructured debt at the beginning of October and said the increased liquidity it represents will allow it to renew marketing programs for the unsold quartershares in the Steamboat Grand.

The Grand was built on 20 acres across Mount Werner Circle from the base of the ski area. It contains 232 condominium units, which are convertible to 412 hotel rooms.

Including commercial space, conference rooms and restaurants, it encompasses more than 420,000 square feet of building space.

The footprint of the building alone covers more than two acres.


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