American Skiing subsidiaries default on credit facility payments

By Sara Rosenberg

New York, May 22 - American Skiing Co. Resort Properties Inc. (ASCRP) defaulted on its senior secured credit facility with Fleet National Bank and certain other lenders due to missed payments of principal and interest, according to a filing with the Securities and Exchange Commission. In addition, Grand Summit Resort Properties Inc. was in payment default under its construction loan facility with Textron Financial Corp. and certain other lenders. Both ASCRP and Grand Summit are subsidiaries of Bethel, Md. based American Skiing Co.

On Tuesday, lenders notified ASCRP that they are accelerating the entire remaining principal and accrued interest in the amount of about $63.4 million.

ASCRP is currently involved in negotiations with lenders to revise the real estate credit facility in hopes that an agreement can be reached before the loan is called in. While the negotiations are taking place, lenders are pursuing remedies available to them including, setoff of cash collateral accounts in ASCRP's name held at Fleet in the amount of approximately $0.8 million, foreclosure of real and personal property owned by ASCRP and pledged to the lenders and other customary secured creditor remedies, the filing said.

On May 17, Textron notified Grand Summit that revisions to the agreement were approved to cure the outstanding payments default. However, the remaining lenders have not yet approved the modified agreement, the filing said.

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