SECOND AMENDMENT TO MANAGEMENT AGREEMENT
Exhibit 8.16
SECOND AMENDMENT TO MANAGEMENT AGREEMENT
THIS SECOND AMENDMENT TO MANAGEMENT AGREEMENT effective September 1, 2001 amends that certain
Management Agreement dated as of December 1, 1997, between Retama Development Corporation having an
office at 0 Xxxxxx Xxxxxxx, Xxxxx, Xxxxx 00000 (“Owner”), Retama Partners, Ltd. having an office at
0000 Xxxxx Xxxxx, Xxx Xxxxxxx, Xxxxx 00000 (“License Holder”), and Retama Entertainment Group,
Inc., a Texas Limited Liability Corporation, having an office at 0 Xxxxxx Xxxxxxx, Xxxxx, Xxxxx
00000 (“Operator”).
The Management Agreement is hereby amended as follows:
1. The term of the Agreement outlined in Section 2.1 shall be hereby extended to November 1,
2010.
2. The last sentence of Section 4.5 shall be deleted and replaced with the following:
“Any such contract shall comply with the provisions of Rev. Proc. 97-13, as amended, modified,
or revised.”
3. Section 6.1 shall be deleted and replaced with the following:
“6.1 As consideration for its services hereunder, the Operator shall be entitled to receive a
monthly fixed management fee (the “Fixed Management Fee”) in the amount of $15,000, plus, subject
to the limitations set forth in this Section, a variable management fee as described in Section 6.2
(the “Variable Management Fee”), which together with the Fixed Management Fee are collectively
referred to as the “Management Fees.” The Fixed Management Fee shall be payable in arrears on or
before the first working day of each month during the term of this Agreement. Beginning January 1,
2002, the Fixed Management Fee shall be increased to $20,000 per month. The Variable Management
Fee shall be payable as set forth in Section 6.2. It is the intention of the Owner and the
Operator that the Management Fees comply with the terms and provisions of Rev. Proc. 97-13,
including any amendments, modifications, or revisions thereto.” Until such time as all bonded
indebtedness related to the Racetrack is discharged in full, the Management Fees set forth in this
Article VI shall not be amended unless Owner first obtains an opinion of national recognized bond
counsel, to the effect that such changes shall not adversely affect the exclusion from gross income
under section 103(a) of the Internal Revenue Code of 1986, as amended, of interest on any Bonds
issued by the Owner to finance or refinance the Racetrack.”
4. Section 6.2 shall be deleted and replaced with the following:
“6.2 The annual Variable Management Fee shall be in the amount of three-tenths of one percent
(.3%) of total Handle of the Racetrack in excess of $100,000,000; provided, however, that the
amount payable for the Variable Management Fee for any year shall not exceed the amount of the
Fixed Management Fee for such year. The Variable Management Fee shall be
calculated on the Handle for each year ending December 31, beginning with the year ending December
31, 2001.
The annual Variable Management Fee shall be payable by January 15 of the following year;
provided, however, that such Variable Management Fee shall be accrued and not paid when the Owner
is in default on the payment of any interest payable on its Special Facilities Revenue Refunding
Bonds (Retama Park Racetrack
Project) Series 1999A. Such accrued Variable Management Fee shall be paid as soon as possible
after any default on payment of such interest has been made or waived.
For the purposes of this Agreement, Handle shall mean the total amount wagered at the
Racetrack including xxxxxx on live racing, simulcast racing (including import simulcasting) and any
other forms of wagering approved at the Racetrack during the term of this Agreement.”
5. The first sentence of the second paragraph of Article XX shall be deleted and replaced
with the following:
“The Owner is aware that Call Now, Inc. (“CNI”) is the owner of certain Bonds issued by the
Owner and is also an owner of the Operator.”
6. Section 21.17 shall be deleted and replaced with the following:
“Any amendment to this Agreement shall comply with the requirements of Rev. Proc. 97-13, as
amended, modified, or revised.”
7. All accrued and unpaid Variable Management Fees as of December 31, 2000 are hereby waived.
This Second Amendment to Management Agreement is dated October 30, 2001 but shall be effective
retroactive to September 1, 2001.
All other provisions of the Management Agreement shall remain in full force and effect.
SIGNATURE PAGE TO FOLLOW
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the day
and year above written.
| OWNER: | ||||||
| RETAMA DEVELOPMENT CORPORATION | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| OPERATOR: | ||||||
| RETAMA ENTERTAINMENT GROUP | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
