**Exhibit10.37**

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

EXECUTIVE EMPLOYMENT AGREEMENT, made as of November 7, 2002 by andbetween AMERICAN SKIING COMPANY, a Delaware corporation (the “Company”), andHelen E. Wallace (the “Executive”), and individual residing at 12033 LouiseAve., Granada Hills, CA 91344.

 

WHEREAS, the Company desires to employ the Executive and the Executivedesires to continue to be so employed, on the terms and subject to theconditions set forth in this agreement (the “Agreement”).

 

NOW, THEREFORE, in consideration of the mutual covenants set forthherein and for other good and valuable consideration the parties hereto herebyagree as follows:

 

1.             Employment:Term. The Company hereby employs the Executive, and the Executive agrees tobe employed by the Company, under the terms and subject to the conditions setforth herein, commencing on or before December 5, 2002 (the “CommencementDate”) for an initial term of three (3) years.

 

Unless earlier terminated in accordance with Section 4 of this Agreement,such term shall automatical1y be extended for an additional three (3) yearperiod unless, not 1ater than one year prior to the expiration of the initialperiod, either party hereto shall provide written notice of its or her desirenot to extend the term hereof to the other party hereto (the initial periodtogether with any 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, Chief Financial Officer and Senior Vice Presidentof American Skiing Company. The Executive shall undertake the responsibilitiesand exercise the authority customarily performed, undertaken and exercised bypersons situated in a similar executive capacity, and shall perform such otherspecific duties and services (including service as an officer, director orequivalent position of any direct or indirect subsidiary without additionalcompensation) as the Board of Directors of the Company (the “Board”) or ChiefExecutive Officer of the Company (the “CEO”) shall reasonably request. TheExecutive shall report directly to the CEO of the Company.

 

During the Term, the Executive shall be responsible for, but notlimited to, the following: all finance, and accounting and information systemmanagement activities. These include: corporate reporting, operational finance,tax, cash-management, risk management, payroll, accounts payable, general andproperty accounting, internal auditing, financial systems and budgetarycontrols. Direct reports include the Vice President of Operations Finance, theVice President of Finance and Accounting and the Vice President of InformationSystems. The total finance and accounting organization includes accountingstaff at the resort locations in Vermont, Maine, New Hampshire, Colorado andUtah.

 

The Executive agrees to devote her ful1 business time and best effortsand attention to the business and affairs of the Company and to faithful1y anddiligently perform, to the best of her ability, al1 of her duties andresponsibilities hereunder. Nothing in this Agreement shal1 preclude theExecutive from devoting reasonable time and attention to (i) serving, with theapproval of the Board, as a director, trustee or member of any committee of anyorganization, (ii) engaging in charitable and community activities and (iii)managing her personal investments and affairs; provided that such activities donot involve a conflict of interest with the interests of the Company or,individual1y or col1ectively, interfere material1y with the performance by theExecutive of her duties and responsibilities under this Agreement.Notwithstanding the foregoing and except as expressly provided herein, duringthe Term (when the Executive holds the above position), the Executive 

 

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may not accept employment with any other individual or entity, orengage in any other venture which is directly or indirectly in conflict orcompetition with the business of the Company.

 

(b) The Executive’s office and place of rendering her services underthis Agreement shall be in the principal executive offices of the Company,which shall be in the Salt Lake City/ Park City, Utah area. Under nocircumstances shall the Executive be required to relocate from the Salt LakeCity/Park City Utah area or provide services under this Agreement in any otherlocation other than in connection with reasonable and customary businesstravel. During the Term, the Company shall provide the Executive with executiveoffice space, and administrative and secretarial assistance and other supportservices consistent with her position and with her duties and responsibilitieshereunder.

 

3.             Salary:Additional Compensation. Prerequisites and Benefits. 

 

(a) During the Term, the Company shall pay the Executive a base salary(the “Base Salary”) at an annual rate of not less than Two Hundred Fifty NineThousand dollars ($259,000.00). Subject to annual review by the CompensationCommittee of the Company’s Board in consultation with the Chief ExecutiveOfficer, such Base Salary may be increased from time to time, but not decreasedwithout the prior consent of the Executive. Base Salary shall be paid inperiodic installments in accordance with the Company’s standard practice, butnot less frequently than semi-monthly.

 

(b) Bonus. For each fiscal year during the Term (commencing withthe Company’s fiscal year 2003), the Executive will be eligible to receive abonus from the Company. The award and amount of such bonus shall be based uponthe achievement of predefined operating or performance goals and other criteriaestablished by the Compensation Committee, which goals shall give the Executivethe opportunity to earn a bonus in the following amounts: target- fifty percent(50%) of Base Salary and maximum bonus amount- seventy-five percent (75%) ofBase Salary. For the Company’s 2003 fiscal year, Executive shall be entitled tothe greater of the calculated payment under the Company’s incentivecompensation plan or $50,000. In addition, the Executive shall receive, 30 daysafter commencement of employment, a signing bonus equal to $30,000.

 

(c) Employee Benefits. During the Term, the Executive shallparticipate in all plans now existing or hereafter adopted by the Company for itsmanagement employees or the general benefit of its employees, such as anypension, profit-sharing, bonuses, stock option or other incentive compensationplans, life and health insurance plans, or other insurance plans and benefitson the same basis and subject to the same qualifications as other seniorexecutive officers. During the Term, Executive will also be entitled toparticipate in all other employee benefits programs now existing or hereafteradopted by the Company for its management employees, including, but not limitedto skiing/snowboarding privileges at Company owned - resortsand discounts for Perfect Turn clinics, Company owned ASC retail stores andrestaurants.

 

(d) Equity. The Executive shall be eligible for participation in the Company’s Phantom Equity Plan, as amendedfrom time to time by the Compensation Committee of the Board (the “EquityPlan”) at a participation percentage equal to nine and one- half percent(9.5%). The terms of such participation shall be governed by the Equity Plan andan award agreement entered into by and between the Executive and the Company.

 

(e) Expenses. The Company shall reimburse the Executive, inaccordance with its standard policies from time to time in effect, for anout-of-pocket business expenses as may be incurred by the Executive in theperformance of her duties under this Agreement.

 

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(f) Vacation. The Executive shall be entitled to vacation timeto be credited and taken in accordance with the Company’s policy from time totime in effect for senior executives, which in any event shall not be less thana total of four (4) weeks per calendar year.

 

(g) Indemnification. To the fullest extent permitted byapplicable law, the Executive shall be indemnified and held harmless by theCompany against any and all judgments, penalties, fines, amounts paid insettlements, and other reasonable expenses (including, without limitation,reasonable attorney’s fees and disbursements) actually incurred by theExecutive in connection with any threatened, pending or completed action, suitor proceeding (whether civil, criminal, administrative, investigative or other)for any action or omission in her capacity as a director, officer or employeeof the Company except any action which would otherwise constitute “Cause” (assuch term is defined in Section 4(b) of this Agreement). Indemnification underthis Section 3(g) shall be in addition to, and not in lieu of, any otherindemnification by the Company of its officers and directors.

 

(h) COBRA Reimbursement. The Company will reimburse Executive for COBRA payments under theExecutive’s current benefit plan until the Executive is eligible for benefitsunder the Company’s plan.

 

(i) Relocation Expenses. The Company will reimburse Executivefor reasonable costs of moving household goods from Executive’s currentresidence in Granada Hills, CA, to Park City/Salt Lake City, UT in accordancewith the Company’s relocation policy for a period of up to one year from startdate. The Company will provide temporary housing for Executive and her familyfor a period of ninety (90) days from Executive’s start date. In the event theExecutive does not find housing within the first ninety (90) days, then thetemporary housing allowance will be extended in additional thirty (30) dayincrements, not to exceed one hundred eighty (180) days of temporary housing.In addition, the Company will reimburse.

 

Executive for two (2) round trip coach class tickets per month for thefirst ninety (90) days of employment for travel between Park City and LosAngeles, California. In the event that Executive terminates employment withoutGood Reason within the first twelve (12) months of the date of this Agreement,the after-tax portion of any relocation costs paid to Executive or made onExecutive’s behalf shall be reimbursed to the Company on a prorated basis,commencing at the first of the month following the month in which Executive’semployment is terminated. By way of example, if Executive commences employmenton November 29,2002 resigns without Good Reason on April 15, 2003, Executivewill reimburse to the Company seven-twelfth’s of the after-tax amount for anyrelocation costs that Executive received or was paid on Executive’s behalf bythe Company.

 

4.             Termination andSeverance. 

 

(a) Death or Disability. The Term shall terminate immediatelyupon the Executive’s death or, upon thirty (30) days prior written notice bythe Company, in the case of a determination of the Executive’s Disability. Asused herein the term “Disability” means the Executive’s inability to performher duties and responsibilities under this Agreement for a period of more than120 consecutive days, or for more than 180 days, whether or not continuous,during any 365-day period, due to physical or mental incapacity or impairment.A determination of Disability will be made by a physician reasonablysatisfactory to both the Executive and the Company and paid for by the Companywhose decision shall be final and binding on the Executive and the Company; providedthatif the partiescannot agree as to a physician, then each shall select and pay for a physicianand these two together shall select a third physician whose fee shall be borneequally by the Executive and the Company and whose determination of Disabilityshall be binding on the Executive and the Company.

 

If the Term is terminated upon the Executive’s death or Disability, theCompany shall pay to the Executive’s estate or the Executive, as the case maybe, a lump sum payment of an amount equal to (i) the 

 

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Executive’s Base Salary through such termination date, (ii) a pro rataportion of the Executive’s Annual Bonus with respect to the fiscal year inwhich the termination occurred and (iii) any accrued but unpaid vacationthrough the date of such termination.

 

(b) Termination for Cause. The Term may be terminated by theCompany upon notice (as set forth in this Section 4(b)) to the Executive uponthe occurrence of any event constituting “Cause” as defined below. If the Termis terminated by the Company for Cause, the Company will pay the Executive anaggregate amount equal to the Executive’s accrued and unpaid Base Salary andvacation pay through too date of such termination. For purposes of this Agreement,“Cause” shall mean the Executive’s (i) willful and intentional failure orrefusal to perform or observe any of her material duties, responsibilities orobligations set forth in this Agreement; provided, however, that theCompany shall not be deemed to have Cause pursuant to this clause (i) unlessthe Company gives the Executive written notice that the specified conduct hasoccurred and making specific reference to this Section 4(b) (i) and theExecutive fails to cure the conduct within thirty (30) days after receipt ofsuch notice; (ii) any willful and intentional act of the Executive involvingmalfeasance, fraud, theft, misappropriation of funds, embezzlement ordishonesty affecting the Company; or(iii) the Executive’s conviction of, or aplea of guilty or nolo contendere to, an offense which is a felony in thejurisdiction involved.

 

Termination of the Executive for Cause shall be communicated by aNotice of Termination. For purposes of this Agreement, a “Notice ofTermination” shall mean delivery to the Executive of a copy of a resolutionduly adopted by the affirmative vote of the majority of the entire membershipof the Board that the Executive was guilty of conduct constituting Cause andspecifying the particulars thereof in detail, including, with respect to anytermination based upon conduct described in clause (i) above, that theExecutive failed to cure such conduct during the thirty-day period following the date on which the Company gave written notice of the conduct referred to in such clause (i). Forpurposes of this Agreement, no such purported termination of the Executive’semployment shall be effective without such Notice of Termination.

 

(c) Termination by the Executive without Good Reason. If theTerm is terminated by the Executive other than because of death, Disability orfor Good Reason (as such term is defined in Section 4(e) hereof, the Companyshall pay to the Executive an aggregate amount equal to the Executive’s accruedand unpaid Base Salary and vacation through the date of such termination.

 

(d) Termination By the Company without Cause (other than on accountof death or Disability) or by the Executive for Good Reason. If the Term isterminated by the Company without Cause (other than by reason of death orDisability), or if the Executive terminates the Term for Good Reason (asdefined below), the Company shall pay the Executive a lump sum equal to onehundred percent (100%) of the Executive’s Base Salary as in effect on the dateof such termination.

 

(e) Definition of “Good Reason”. For purposes of this Agreement,“Good Reason” shall mean the occurrence of any of the following, without theprior written consent of the Executive: (A) assignment of the Executive ofduties materially inconsistent with the Executive’s position as described inSections 2(a) and 2(b) hereof, or assignment of the Executive to report to anexecutive of the Company other than the Chief Executive Officer (so long assuch position exists within the Company); (B) any significant diminution in theExecutive’s duties or responsibilities, other than in connection with thetermination of the Executive’s employment for Cause, Disability or as a resultof the Executive’s death or by the Executive other than for Good Reason; (C)the change in the location of the Company’s principal executive offices or theExecutive’s principal place of employment to a location outside the Salt LakeCity/Park City, Utah area; or (D) the material breach by the Company of thisAgreement; provided, however, that Good Reason shall not exist pursuantto this clause unless the Executive gives the Company written notice that thespecified conduct or breach has occurred and the Company fails to cure theconduct or breach within thirty (30) days of receipt of such notice.

 

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(f) Mitigation. Under no circumstances shall the Executive, upontermination of her employment hereunder, be required to seek alternativeemployment and, in the event the Executive does secure other employment, noother compensation or other benefits received in respect of such employmentshall be set-off or in any other way limit or reduce the obligations of theCompany under this Agreement.

 

(g) Notwithstanding the previous provisions, if payments made pursuantto this Section 4 are considered “parachute payments” under Section 2800 of theInternal Revenue Code of 1986, as amended (the “Code”) then the sum of suchparachute payments plus any other payments made by the Company to the Executivewhich are considered parachute payments shall be limited to the greatest amountwhich may be paid to the Executive under Section 280G of the Code withoutcausing any loss of deduction to the Company under such section or Excise Taxto the Executive pursuant to Section 4999 of the Code.

 

(h) Phantom Equity Plan: This Agreement shall not in any waylimit or reduce the obligations of the Company with respect to the Executiveand/or the Executive’s rights with respect to the Company set forth in theEquity Plan further described herein. All severance, compensation payments andbonuses and benefits described herein are in addition to and not in lieu of anyother benefits or termination conditions to which the Executive may be entitledunder the Equity Plan.

 

(i) Change in Control: If a Change in Control occurs, then anyaward under the Equity Plan shall become fully vested. “Change in Control”shall mean the occurrence of any of the following: (i) The acquisition (otherthan from the Company) by any “Person” of fifty (50%) percent or more of thecombined voting power of the Company’s then outstanding voting securities,other than any Person holding fifty percent or more of such combined votingpower on the date hereof, provided; however, that for purposes of thisoffer letter, the parties hereby agree and acknowledge that Oak Hill CapitalPartners L.P. and/or its affiliates as of the date of this offer letter owns atleast 50% of the combined voting power of the Company’s outstanding votingsecurities; (ii) the individuals who were members of the Board (the “IncumbentBoard”) during the previous twelve (12) month period, cease for any reason toconstitute at least a majority of the Board and at least a majority of theBoard was not nominated for election to the board of directors with the approvalof at least two-thirds of the Incumbent Board; or (iii) approval bystockholders of the Company of (a) a merger or consolidation involving theCompany in which the stockholders of the Company, immediately before suchmerger or consolidation do not, as a result of such merger or consolidation,own, directly or indirectly, more than sixty percent (60%) of the combinedvoting power of the then outstanding voting securities of the corporationresulting from such merger or consolidation in substantially the sameproportion as their ownership of the combined voting power of the securities ofthe Company outstanding immediately before such merger or consolidation or (b)a complete liquidation or dissolution of the Company or an agreement for thesale or other disposition of all or substantially all of the assets of theCompany.

 

5.             ConfidentialInformation. 

 

The Executive acknowledges that the Company and its subsidiaries oraffiliated ventures (“Company Affiliates”) own and have developed and compile,and will in the future own, develop and compile certain ConfidentialInformation and that during the course of her rendering services hereunderConfidential Information will be disclosed to the Executive by the CompanyAffiliates. The Executive hereby agrees that, during the Term and for a periodof three years thereafter, he will not use or disclose, furnish or makeaccessible to anyone, directly or indirectly, any Confidential Information ofCompany Affiliates.

 

As used herein, the term “Confidential Information” means any tradesecrets, confidential or proprietary information, or other knowledge, know-how,information, documents or materials, owned developed or possessed by CompanyAffiliate pertaining to its businesses the confidentiality of which suchcompany takes reasonable measures to protect, including, but not limited to,trade secrets, techniques, know-

 

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how (including designs, plans, procedures, processes and researchrecords), 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 ofdocuments, expansion plans, budgets, projections, and salary, staffing andemployment information. Notwithstanding the foregoing, Confidential Informationshall not in any event include information which (i) was generally known orgenerally or generally available to the public prior to disclosure to theExecutive, (ii) becomes generally known or generally available to the publicsubsequent to its disclosure to the Executive through no wrongful act of theExecutive, (iii) is or becomes available to the Executive from sources otherthan the Company Affiliates which sources are not known to the Executive to beunder any duty of confidentiality with respect thereto, (iv) the Executive isrequired to disclose by applicable law or regulation or by order of any courtor federal, state or local regulatory or administrative body (provided that theExecutive provides the Company with prior notice of the contemplated disclosureand reasonably cooperates with the Company, at the Company’s sole expense, inseeking a protective order or other appropriate protection of such information)or (v) known to the Executive prior to her employment with the Company.

 

6.             Nonsolicitation.

 

(a) The Executive recognizes and acknowledges that the services to beperformed by her hereunder are special, unique and extraordinary and theExecutive further acknowledges and recognizes the highly competitive nature ofthe business of the Company. The Executive understands that (i) the provisionsof this Section 6 do not impose a greater restraint than is necessary toprotect the goodwill or other business interests of the Company, (ii) suchprovisions contain reasonable limitations as to time and scope of activity tobe restrained, (iii) such provisions are not harmful to the general public,(iv) such provisions are not unduly burdensome to the Executive, and (v) theconsideration provided hereunder is sufficient to compensate the Executive forthe restrictions contained in such provisions. Accordingly, the Executiveagrees that during the Employment Term and for a period of twelve (12) monthsfollowing termination of employment (the “Restrictive Period”), the Executivewill not (i) directly or indirectly solicit or encourage any employee of theCompany to leave the employment of the Company, or (ii) directly hire any suchemployee who bas left the employment of the Company (other than as a result ofthe termination of such employment by the Company) within three (3) monthsafter the termination of such employee’s employment with the Company, and (ii)directly or indirectly, solicit or encourage to cease to work with the Companyany consultant then under contract with the Company.

 

(b) It is expressly understood and agreed that although the Executiveand the Company consider the restrictions contained in this Section 6 to bereasonable, if a final judicial determination is made by a court of competentjurisdiction that the time or territory or any other restriction contained inthe Agreement is an unenforceable restriction against the Executive, theprovisions of the Agreement shall not be rendered void but shall be deemedamended to apply as to such maximum time and territory and to such maximumextent as such court may judicially determine or indicate to be enforceable.Alternatively, if any court of competent jurisdiction finds that anyrestriction contained in the Agreement is unenforceable, and such restrictioncannot be amended so as to make it enforceable, such finding shall not affectthe enforceability of any of the other restrictions contained herein.

 

7.             SpecificPerformance. 

 

(a) The Executive acknowledges that the services to be rendered by herhereunder are of a special, unique, extraordinary and personal character andthat the Company would sustain irreparable harm in the event of a violation bythe Executive of Section 5 or 6 of this Agreement. Therefore, in addition toany other remedies available, the Company shall be entitled to specificenforcement and/or injunction from any court of competent jurisdictionrestraining the Executive from committing or continuing any such violation ofthis 

 

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Agreementwithout proving actual damages or posting a bond or other security. Nothingherein shall be construed as prohibiting the Company from pursuing any otherremedies available to it for such breach or threatened breach, including therecovery of damages.

 

(b) If any of the restrictions on activities of the Executive containedin Section 6 hereof shall for any reason be held by a court of competentjurisdiction to be excessively broad, such restrictions shall be construed soas thereafter to be limited or reduced to be enforceable to the maximum extentcomparable with the applicable law as it shall then appear; it being understoodthat by the execution of this Agreement the parties hereto regard such restrictionsas reasonable and compatible with their respective rights.

 

8. Withholding. The parties agree that all payments to be madeto the Executive by the Company pursuant to the Agreement shall be subject toall applicable withholding obligations of the Company.

 

9. Notices. All notices required or permitted hereunder shall bein 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 (I) day after delivery if sent by air courier (fornext-day delivery) with evidence or receipt thereof or by facsimile withreceipt confirmed by the addressee. Such notices shall be addressedrespectively:

 

If to the Executive, to:

 

Helen E. Wallace

12033 Louise Avenue

Granada Hills, CA 91344

 

If to the Company, to:

 

American Skiing Company

136 Heber Ave, #303

Park City, Utah 84060

Attn: General Counsel

 

orto any other address of which such party may have given notice to the otherparties in the manner specified above.

 

10.           Miscellaneous. 

 

(a) This Agreement is a personal contract calling for the provisions ofunique services by the Executive, and the Executive’s rights and obligationshereunder may not be sold, transferred, assigned, pledged or hypothecated bythe Executive. The rights and obligations of the Company hereunder will bebinding upon and run in favor of their respective successors and assigns.

 

(b) This Agreement shall be governed by and construed and enforced inaccordance with the internal laws of the State of Utah, without regard toconflict of laws principles.

 

(c) Any controversy arising out of or relating to this Agreement or anybreach hereof shall be settled by arbitration in Salt Lake City, Utah by asingle neutral arbitrator in accordance with the Commercial Arbitration Rulesof the American Arbitration Association. Judgment upon any award rendered maybe entered in any court having jurisdiction thereof, except in the event of acontroversy relating to any alleged violation by the 

 

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Executiveof Section 6 or 7 hereof, in which case the Company shall be entitled to seekinjunction relief from a court of competent jurisdiction without therequirement to seek arbitration.

 

(d) The headings of the various sections of this Agreement are forconvenience of reference only and shall not define or limit any of the terms orprovisions hereof.

 

(e) The provisions of this Agreement which by their terms call forperformance subsequent to the expiration or termination of the Term shallsurvive such expiration or termination.

 

(f) This Agreement constitutes the entire agreement of the partieshereto with respect to the subject matter hereof (other than the Equity Plan,as further described herein) and supersedes all other prior agreements andundertakings, both written and oral, among the parties with respect to thesubject matter hereof, all of which shall be terminated on the CommencementDate. In addition, that parties hereto hereby waive all rights such party mayhave under all other prior agreements and hereto hereby waive all rights suchparty may have under all other prior agreements and undertakings, both writtenand oral, among the parties hereto, or among the Executive, with respect to thesubject matter hereof.

 

 

[SIGNATURE PAGE FOLLOWS]

 

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|   | EXECUTIVE                                   |
|--------|---------------------------------------------|
|   |                                        |
|   |                                        |
|   | /s/ Helen E. Wallace                        |   |
|   | **Helen  E. Wallace**                       |
|   |                                        |
|   |                                        |
|   | AMERICAN  SKIING COMPANY                    |
|   |                                        |
|   | /s/ B.J. Fair                               |   |
|   | **By:  B.J. Fair, Chief Executive Officer** |

 

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