AGREEMENT
THIS AGREEMENT is made, entered into and effective this _10__ day of
_April__, 2000, by and between Mountaineer Park, Inc., a corporation organized
and existing under the laws of the State of West Virginia (MPI) and Mountaineer
Park Horsemen's Benevolent and Protective Association, Inc., (HBPA), a
corporation organized and existing under the laws of West Virginia (HBPA).
WHEREAS, MPI owns and operates the Mountaineer Racetrack & Gaming Resort
located in Chester, West Virginia ("Mountaineer") which conducts live,
year-round thoroughbred horse racing; and
WHEREAS, Mountaineer does not currently simulcast its live races for
wagering at other tracks or off-track wagering facilities ("export
simulcasting"); and
WHEREAS, in the event Mountaineer were to commence export simulcasting, the
HBPA is to be entitled to a percentage of export simulcasting revenues pursuant
to WestVirginia Code 19-23-12c and by recent amendment to West Virginia Code
19-23-12c, such funds may be used, upon agreement between HBPA and Mountaineer
for capital improvements supporting simulcast operations; and
WHEREAS, as evidenced by the August 15, 1997, Agreement, as amended by
Addendum dated October 6, 1997, MPI and the HBPA have and will continue to exert
their joint efforts to conduct live racing at Mountaineer and to maximize
revenues whether through live or export simulcasting handle; and
WHEREAS, MPI and HBPA agree and acknowledge that it would be, mutually
beneficial if Mountaineer were to provide export simulcasting of its live racing
program to various outlets and distributors within and outside the State of West
Virginia; and
WHEREAS, in light of the mutual benefits to be derived from export
simulcasting at Mountaineer, MPI and HBPA agree to share the costs and expenses
associated with Mountaineer's commencement of export simulcasting as set forth
below.
NOW THEREFORE, in consideration of the mutual convenants herein contained
and other good and valuable, consideration, the sufficiency of which is hereby
acknowledged, the parties undertake and agree as follows:
1. TERM. The term of this Agreement: (i) shall commence upon its full
execution and the specific written approval for or ratification of this
Agreement by the West Virginia Racing Commission; (ii) terminate on December 24,
2001; and (iii) may be extended by mutual agreement of parties hereto FOR UP TO
TWO (2) RENEWAL PERIODS OF ONE (1) YEAR EACH AND ONE (1) RENEWAL EQUAL TO THE
INTERIM BETWEEN THE DATE HEREOF AND THE DATE OF COMMENCEMENT OF EXPORTING
SIMULCAST, IN ACCORDANCE WITH PARAGRAPH 2(b) BELOW. The parties hereto agree to
record the actual date export simulcasting operations commence on a form
substantially similar to that attached as Exhibit B Certificate Confirming
Export Simulcasting Commencement Date attached hereto and made a part hereof.
The parties also agree and acknowledge that this Agreement is effective as of
the date of execution and MPI shall undertake all Improvements, as
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defined below, and incur all costs and expenses so related, in specific reliance
upon this Agreement. This agreement supersedes all prior agreements between the
parties concerning the export simulcast signal.
2. ALLOCATION AND PAYMENT OF IMPROVEMENT COST . (a) In furtherance of the
parties' respective desires to provide for and facilitate export simulcasting,
and in recognition that such simulcasting necessarily requires certain
improvements and upgrades to Mountaineer's facilities and infrastructure and the
purchase of certain additional equipment (the "Improvements"), the parties agree
to share equally the costs and expenses, including without limitation all
amounts of principal, interest (as described below), and ancillary costs, of the
improvements as set forth on Exhibit A titled Improvements and Improvement Costs
attached hereto and made a part hereof ("Improvement Costs"). The parties
acknowledge that improvements other than those set forth on Exhibit A may be
required to facilitate the export simulcasting envisioned by this Agreement.
Those expenditures not specifically listed on Exhibit A shall be subject to the
terms of this Agreement only upon the subsequent written consent of the HBPA.
(b) Such Improvement Costs shall be amortized over a three (3) year period
commencing on the commencement date of export simulcasting as indicated on
Exhibit B and payable on each day during which Mountaineer conducts export
simulcasting. The parties agree that HBPA's share of the Improvement Costs
delineated in Exhibit A shall be payable from, exclusively, export simulcasting
revenues otherwise to be deposited in the purse fund pursuant to West Virginia
Code 19-23-12c [as amended] (i.e. fifty percent of transmission fees after
deductions set forth in subsection (b) of West Virginia Code 19-23-12c, referred
to herein as the "Purse Payment") for the initial term of this Agreement. The
parties have estimated, based upon 210 days of export simulcasting per calendar
year and Improvement Costs as set forth on Exhibit A, that the HBPA's payment
for Improvement Costs, including reimbursement of interest, shall be $2,795.79
per day of export simulcasting. To the extent the Purse Payment for any given
day exceeds $2,795.79, then such excess shall be deposited into the purse fund.
If during the term of this Agreement, either the number of export simulcast days
or the amount of Improvement Costs changes, the parties agree to adjust the
HBPA's payment schedule equitably.
(c) If at the conclusion of the initial term of this Agreement the HBPA
has not paid its share of Improvement Costs in full then this Agreement shall,
at HBPA's election, be either: (i) renewed for a period of one (1) year up to
two (2) times until HBPA's share of (c)If at the conclusion of the initial term
of this Agreement the HBPA has not paid its share of Improvement Costs in full,
then this Agreement shall, at HBPA's election be either: (i) renfor a
Improvement Costs is satisfied; or (ii) renegotiated to provide the schedule of
payments for HBPA's share of Improvement Costs; PROVIDED, HOWEVER, that if the
parties cannot agree upon a new schedule despite good faith efforts, then the
Agreement shall be renewed in accordance with the preceding clause of this
subsection. At no time will any renegotiated contract exceed a two (2) year
period. In no case will the total term including any renegotiated contract,
exceed a total of 5 years inclusive from the date of commencement of exporting
simulcasting.
(d) HBPA understands that MPI currently pays its lender interest at the
rate of 9.5% annually, subject to rate adjustments as contained in the lending
agreement. The parties agree and understand that the interest rate quoted herein
in various sections shall be adjusted to mirror any adjustment (upward or
downward) in MPI's rate of interest and the rate of interest herein shall be
MPI's actual rate of interest in effect at the time of the expenditure. In
addition to its share of Improvement Costs, HBPA shall also pay MPI such
interest (which is reflected in the
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daily payment of $2,795.79) for the following improvements only: (i) track
lighting upgrade; (ii) paving of backside roadways; and (iii) IMPROVEMENTS AND
PAVING OF ALL EXISTING DITCHLINES, as more fully set forth on Exhibit A as items
numbered 1, 3, 5, 6, 7 and 8. (whether MPI pays for the Improvement Costs out of
its current cash or draws against its line of credit). MPI shall provide HBPA
with monthly reports detailing the outstanding sums of principal and interest
owed by HBPA. and amounts of Improvement Costs by expenditures which shall be
accompanied by copies of invoices and copies of CANCELLED checks and outstanding
sums of principal and interest owed by HBPA. In the event MPI refinances its
debt at a lower interest rate, the amount of interest paid thereafter by the
HBPA shall be adjusted accordingly.
3. OWNERSHIP AND CONTROL. It is agreed that all right, title and
beneficial interest in and to all Improvements constructed, purchased, obtained
or effected in furtherance of export simulcasting operations funded pursuant to
this Agreement and/or specifically listed on Exhibit A hereto, shall be owned
solely and exclusively by MPI. HBPA shall have no right in or title to the
Improvements and expressly agrees, acknowledges and covenants that it shall have
no right or authority to and shall not under any circumstances sell, transfer,
or convey or grant a security interest in, cause a lien, mortgage or other
third-party security interest to attach to or otherwise encumber the
Improvements.
4. TERMINATION: NO GUARANTY. MPI in its sole and absolute discretion, may
discontinue export simulcasting after twelve (12) months following its
commencement to be indicated on Exhibit B. In the event that MPI decides to
discontinue export simulcasting, HBPA shall be relieved of any further financial
obligations under this Agreement. Further, the parties acknowledge, each to the
other, that neither party can provide any assurances or guarantees or make any
representations, express or implied, that export simulcasting at Mountaineer
will be successful or that the parties' joint efforts in furtherance of export
simulcasting will permit the parties to recoup the Improvement Costs during the
term of this Agreement or thereafter. Upon expiration or earlier termination of
this Agreement, any and all expenses and revenues for export simulcasting shall
be allocated according to West Virginia Code 19-23-12c as it may be amended from
time to time.
5. VIDEO LOTTERY REVENUES. In accordance with the West Virginia Racetrack
Video Lottery Act (West Virginia Code 29-22A-1 et. seq.) in no even shall
proceeds from Mountaineer's video lottery operations which statutorily are
dedicated to the Horsemen's Purse Fund be used to pay the Improvement Costs.
6. SUCCESSORS AND ASSIGNS . The terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the parties and their
respective successors and permitted assigns. Neither MPI nor HBPA may assign
their rights or delegate their obligations under this Agreement without the
prior written consent of the other party. Notwithstanding anything herein to the
contrary, MPI shall be permitted to assign this Agreement without HBPA's consent
to any entity approved by the West Virginia Racing Commission and having
financial capability comparable to MPI by providing notice to HBPA within thirty
(30) days of such assignment.
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7. MODIFICATION AND WAIVER. None of the terms or conditions of this
Agreement may be waived, except in writing by the party or parties entitled to
the benefit thereof. No supplement, modification or amendment of this Agreement
shall be binding unless duly executed in writing by both parties. No waiver of
any of the provisions of this Agreement shall be deemed or shall constitute a
waiver of any other provision (whether or not similar) nor shall such waiver
constitute a continuing waiver.
8. SEVERABILITY. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under present or future laws by any court of
competent jurisdiction, such illegality, invalidity or unenforceability shall
not affect the legality, enforceability or validity of any other provisions or
of the same provisions applied to any other fact or circumstances and such
illegal, unenforceable or invalid provision shall be modified to the minimum
extent necessary to make such provision legal, valid or enforceable, as the case
may be.
9. NOTICES. Any notice, request, instruction or other document to be
given under this Agreement by either party to the other party shall be in
writing and (i) delivered personally; (ii) sent by telecopy; (iii) delivered by
overnight express (charges prepaid); or (iv) sent by registered or certified
mail (postage pre-paid) addressed as follows:
If to MPI to: Edson R. Arneault, President
Mountaineer Park, Inc.
Route 2, P.O. Box 358
Chester, West Virginia 26034
If to HBPA to: Charles E. Bailey, President
Mountaineer Park, HBPA
Route 2, P.O. Box 358
Chester, West Virginia 26034
or at other such address for a party as shall be specified by like notice. Any
notice which is delivered personally, telecopied or sent by overnight express in
the manner provided in this section shall be deemed to have been duly given to
the party to whom it is addressed upon actual receipt by such party. Any notice
which is addressed and mailed in the manner herein provided shall be
conclusively presumed to have been given to whom it is addressed at the close of
business Eastern Standard time, on the third business day after it is so placed
in the mail.
10. MISCELLANEOUS . This Agreement: (i) shall be governed by and construed
in accordance with the laws of the State of West Virginia and any legal action
shall be MEDIATED prior to any legal action in an appropriate court of the State
of West Virginia, (in the event of any such action BOTH PARTIES AGREE TO WAIVE
THEIR RESPECTIVE RIGHT TO A JURY TRIAL and agree that the prevailing party shall
be entitled to all costs and expenses thereof, including reasonable attorney
fees); (ii) constitutes the entire agreement and understanding between the
parties and supercedes all prior agreements and understanding between the
parties, written and oral, with regard to the subject matter herein; (iii) may
be executed in multiple counterparts, each of which shall constitute an original
and all of which shall constitute one and the same Agreement, and (iv)
incorporates by reference all exhibits and schedules attached hereto as if fully
set forth herein.
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11. RESTROOMS. MPI agrees to upgrade all backside bathrooms, at MPI's
expense, in accordance with attached Exhibit C, which identifies problem areas
of major concern to horsemen. MPI shall use its best effort to complete the
restrooms no later than ninety (90) days following approval of this Agreement by
the West Virginia Racing Commission.
12. HBPA will have access to all bids and final bills.
IN WITNESS WHEREOF, MPI has hereunto set its hand and seal, or has caused its
name to be hereunto subscribed and HBPA has hereunto set its hand and seal, or
has caused its corporate name to be hereunto subscribed and its corporate seal
to be hereunto affixed and attested by its duly authorized officers, as the
case may be, as of the day and year first above written.
WITNESS: MOUNTAINEER PARK INC.
/S/ /S/ EDSON R. ARNEAULT
- ----------------------------- ----------------------------------------
By: Edson R. Arneault
Its: President
WITNESS: MOUNTAINEER PARK HORSEMEN'S
BENEVOLENT AND PROTECTIVE
ASSOCIATION, INC.
/S/ /S/ CHARLES E. BAILEY
- ----------------------------- ----------------------------------------
By: Charles E. Bailey
Its: President
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EXHIBIT A
AUTHORIZED IMPROVEMENTS AND IMPROVEMENT COSTS
1. Lighting upgrade for both the turf and dirt track in an amount up to
$1,489,000.00 with interest accrued at nine and one-half percent (9.5%) per
annum.*
2. Video production system upgrade at a cost of up to $450.00 per live race
day.
3. Installation of the internal electronics for the Ferranti Packard
reflective disc board (tote board) through a five year lease agreement with
Autotote at an installation cost of up to $17,033.18 plus interest at the
rate of nine and one-half percent 99.5%) per year*, plus a fee of $125.00
per live race day.
4. Extension of the current Autotote contractual agreement at an added cost of
up to $9,000.00 per year.
5. Installation of paving for the backside area, roadways, backside parking
lots, and improvements and paving of the existing ditchlines at a cost of
up to $551,289.06 with interest accrued at nine and one-half percent (9.5%)
per annum.* The parties acknowledge that portions of the paving have been
completed prior to the date of this Agreement, and the remaining paving
will be completed within one hundred twenty (120) days following approval
of the Agreement by the West Virginia Racing Commission, or as soon
thereafter as is reasonable and prudent.
6. Contract with an independent consultant, chosen by mutual agreement of the
parties, to determine improvement options for the racing surfaces, dirt and
turf. Complete any improvements or repairs recommended by the consultant,
up to a maximum expenditure of $500,000 with interest accrued at nine and
one-half percent (9.5%) per annum* Improvements or repairs recommended will
be completed within one hundred twenty (120) days following approval of the
Agreement by the West Virginia Racing Commission, or as soon thereafter as
is reasonable and prudent. MPI agrees to make-up any live race days lost
due to improvements to the track surfaces pursuant to the West Virginia
Code 19-23-12b.
7. Installation, of 300 "dusk to dawn" lights on the backside at a cost of up
to $52,000.00 with interest accrued at nine and one-half percent (9.5%) per
annum.* Such lighting to be completed within one hundred twenty (120) days
following approval of the Agreement by the West Virginia Racing Commission,
or as soon thereafter as is reasonable and prudent.
8. Replacement of thirty (30) and repair of fifty (50) feed sheds on the
backside at a total cost of up to $24,000.00 with interest accrued at nine
and one-half percent (9.5%) per annum.* Such construction and repairs to be
completed within one hundred twenty (120) days following approval of the
Agreement by the West Virginia Racing Commission, or as soon thereafter as
is reasonable and prudent.
*Interest rates quoted herein are subject to the provisions of 2(d) of the
Agreement.
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EXHIBIT B
CERTIFICATE CONFIRMING
EXPORT SIMULCASTING COMMENCEMENT DATE
THIS CERTIFICATE CONFIRMING EXPORT SIMULCASTING COMMENCEMENT DATE is
attached to and made a part of the Agreement dated the _____ day of
________________, 2000, by and between Mountaineer Park, Inc., a corporation
organized and existing under the laws of the State of West Virginia ("MPI") and
The Horsemen's Benevolent and Protective Association, Inc. West Virginia -
Mountaineer Park Division ("HBPA"), a corporation organized and existing under
the laws of West Virginia ("HBPA").
The construction, purchase and undertaking of the Improvements, as
described in the
Agreement and delineated on Exhibit B thereto have been completed and the
Export Simulcasting Commencement Date is the _____ day of ___________________,
_______.
WITNESS: MOUNTAINEER PARK INC.
- ------------------------------ -------------------------------------
By: Edson R. Arneault
Its: President
WITNESS: MOUNTAINEER PARK HORSEMEN'S
BENEVOLENT AND PROTECTIVE
ASSOCIATION, INC.
- ------------------------------ -------------------------------------
By: Charles E. Bailey
Its: President
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EXHIBIT C
BACKSIDE IMPROVEMENTS
(RESTROOMS)
UNDER REC HALL
ELECTRICAL
WOMEN'S RESTROOM
-INSTALL NEW LIGHTS AFTER DROP CEILING
-INSTALL LIGHTS OVER COMMODE AREA
-INSTALL ADDITIONAL WALL PLUGS
MEN'S RESTROOM
-INSTALL NEW LIGHTS AFTER DROP CEILING
CARPENTRY
WOMEN'S RESTROOM
-NEW DOOR AND HANDLE WITH LOCK
-DROP CEILING
-NEW CABINET FOR SINK
-STALL DOORS IN COMMODE AREA & HANDRAIL ON HANDICAP STALL
-MIRROR
-WHEELCHAIR ACCESSIBLE INTO BATHROOM
SHOWER AREA
-SHOWER DOORS INSTALLED (INSTEAD OF CURTAIN)
-HOOKS ON WALLS
-BENCH IN CHANGING AREA
MEN'S RESTROOM
-MIRROR
-EXHAUST FANS IN COMMODE/SHOWER AREA
-NEW DOOR
-DROP CEILING
-SHOWER DOORS INSTALLED (INSTEAD OF CURTAIN)
-HOOKS. ON WALLS
-SHORTEN BENCH
-COMMODE AREA - PUT STALLS WITH DOORS
PLUMBING
(TO UPGRADE HEATING)
WOMEN'S RESTROOM
-FIX LEAK IN COMMODE AREA
-NEW COMMODE SEATS
BACKSIDE IMPROVEMENTS (CONTINUED)
(RESTROOMS)
Page 2
UNDER REC HALL (CONTINUED)
PLUMBING
WOMEN'S RESTROOM - CONTINUED
-CENTER DRAIN NEEDS FIXED & COVERED (FOAM REPLACED WITH CEMENT)
-HEATING NEEDS IMPROVED
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SHOWER AREA.
-DRAIN NEEDS FIXED AND COVERED (FOAM REPLACED WITH CEMENT)
MEN'S RESTROOM
-FIX AND COVER DRAINS PROPERLY
-NOT ENOUGH HEAT
PAINTING
WOMEN'S RESTROOM
-PAINT FLOOR
SHOWER AREA
-PAINT WALLS AND FLOOR
MEN'S RESTROOM
-PAINT ENTRANCE BY PHONE
-PAINT FLOORS
-PAINT INSIDE SHOWER STALLS
UPPER BATHHROOMS (BARN H)
CARPENTRY
WOMEN'S RESTROOM
-NEW ENTRANCE DOOR AND LOCK
-MIRROR
BACKSIDE IMPROVEMENTS (CONTINUED)
(RESTROOMS)
Page 3
UPPER BATHROOMS (BARN H) - CONTINUED
CARPENTRY
MEN'S RESTROOM
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-MIRROR
-ENTRANCE DOOR
-EXHAUST FAN
PLUMBING
WOMEN'S RESTROOM
-FIX LEAKS
-REPAIR DRAIN COVERS
MEN'S RESTROOM
-REPAIR LEAKING TANK ON COMMODE
-REPAIR LEAK ON PIPE TO TANK ON COMMODE
-REPAIR URINAL
-3 NEW SINKS AND FAUCETS
PAINTING
WOMEN'S RESTROOM
-TRIM PAINT
-PAINT FLOOR
MEN'S RESTROOM
-PAINT CEILING
-PAINT FLOOR
UNDER KITCHEN
ELECTRICAL
WOMEN'S RESTROOM
-WALL PLUG
-NEW LIGHTS
BACKSIDE IMPROVEMENTS (CONTINUED)
(RESTROOMS)
Page 4
UNDER KITCHEN (CONTINUED)
ELECTRICAL
MEN'S RESTROOM
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-WALL PLUGS
CARPENTRY
WOMEN'S RESTROOM
-EXHAUST FAN INSTALLED
MEN'S RESTROOM
-NEW DOOR
-MIRROR
-DOORS ON STALLS
PLUMBING
WOMEN'S RESTROOM
-COMMODES LEAK
MEN'S RESTROOM
-DRAIN COVERS
-CENTER DRAIN IS PLUGGED
-URINALS DO NOT WORK
-SINK SPIGOT NEEDS REPLACED
-INSTALL ELECTRIC WALL MOUNTED HEATER
PAINTING
WOMEN'S RESTROOM
-ENTRANCE DOOR PAINTED
-STALL AREAS PAINTED
-PAINT FLOOR & ADDITIONAL COAT ON WALLS
MEN'S RESTROOM
-PAINT FLOOR ON ENTRANCE AREA
-PAINT 2 ND COAT ON WALLS
-PAINT FLOORS
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