Exhibit 10.1
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TBR ACQUISITION GROUP, LLC
1890 Palmer Avenue
Suite 303
Larchmont, New York 10531
December 1, 2005
MTR Gaming Group, Inc.
State Route 2 South
P.O. Box 358
Chester, West Virginia 26034
Ladies and Gentlemen:
In connection with the proposal by TBR Acquisition Group, LLC (the
"Acquisition LLC"), a Delaware limited liability company recently formed by
Edson R. Arneault, Robert A. Blatt, and Robert L. Ruben (together with the
Acquisition LLC, the "Purchasers"), to acquire all of the issued and outstanding
shares of common stock of MTR Gaming Group, Inc. (the "Company"), not already
owned by the Purchasers or their affiliates, the Purchasers and the Company
hereby agree as follows:
1. Reimbursement of Expenses. In order to induce the Purchasers to
commit the resources and incur the legal, financial and incidental expenses
necessary to continue to proceed with the Purchasers' proposal without the
Company having agreed to such proposal or to any limits on the Company seeking
alternative proposals, the Company hereby agrees to reimburse to the Purchasers
(upon presentation of reasonably satisfactory supporting documentation) the
actual, out-of-pocket expenses of the Purchasers (which may include the fees and
disbursements of counsel and financial advisors) incurred in connection with
Purchasers' proposal (prior to such time as the Company advises Purchasers in
writing that the Company intends to pursue an alternative proposal or not to
recommend that stockholders accept the Purchasers' proposal) in an amount not to
exceed Two Hundred Fifty Thousand Dollars ($250,000), in the event that (a)(i)
the Purchasers deliver to the Company evidence reasonably satisfactory to the
Special Committee of the Board of Directors of the Company that Purchasers will
have at the time of closing the requisite financing to complete such
acquisition, it being understood that a "highly confident letter" issued by an
investment banker shall be deemed satisfactory evidence ("Evidence of
Financing"), and (ii) the Company enters into a definitive agreement with a
third party with respect to an Alternative Transaction (as defined below) within
twelve (12) months from the date of this Letter Agreement or (b)(i) prior to
receipt from the Purchasers of Evidence of Financing, the Company enters into a
definitive agreement with a third party with respect to an Alternative
Transaction within twelve (12) months from the date of this Letter Agreement and
(ii) the Company consummates such Alternative Transaction.
The term "Alternative Transaction" shall mean any (i) acquisition of
the Company by merger or business combination transaction, or for a "merger of
equals" with the Company, (ii) acquisition by any person (other than Purchasers,
or any of their respective affiliates or associates) of all or substantially all
of the assets of the Company and its subsidiaries, taken as a whole, or (iii)
acquisition by any person of all of the outstanding shares of common stock of
the Company.
The Purchasers understand that in no event shall the Company be
required to reimburse the expenses referred to in this Letter Agreement with
respect to more than one Alternative Transaction.
2. Governing Law. This Letter Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York without regard
to the principles governing conflict of laws.
3. Execution. This Letter Agreement may be executed in counterparts,
each of which shall be deemed an original and all of which shall be considered
one and the same instrument. This Letter Agreement shall become effective upon
the execution of a counterpart by all parties hereto.
If you are in agreement with the foregoing, please execute where
indicated below and return the original to the undersigned whereupon the parties
shall be bound by the terms of this Letter Agreement.
Very truly yours,
/s/ Robert A. Blatt
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Robert A. Blatt
Managing Member
Agreed and Acknowledged this 1st day of December 2005:
MTR Gaming Group, Inc.
By: /s/ Donald Duffy
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Name: Donald Duffy
Title: Chairman, Special Committee
of the Board of Directors