EXHIBIT 10.2
EXCLUSIVE OPTION TO PURCHASE REAL ESTATE AGREEMENT
On this 5th day of May, 2003 ("Effective Date"), this Exclusive Option
to Purchase Real Estate Agreement ("Agreement") is granted to Scioto Downs, Inc.
("Buyer"), by Mara Enterprises, Inc., an Ohio corporation ("Seller"), to
purchase the approximately 37 acre parcel of real property and any appurtenances
thereto located in the State of Ohio, County of Franklin, Township of Xxxxxxxx,
as more fully described in Exhibit "A" attached hereto and made a part hereof
(the "Property"), subject to the terms and conditions hereof.
1. Grant of Exclusive Option. In consideration of the sum of Ten
Dollars ($10.00) and other good and valuable consideration
receipt of which is hereby acknowledged by Seller, Seller
hereby grants to Buyer the exclusive right and option to
purchase the Property (the "Option to Purchase").
2. Term. The Option to Purchase shall expire on the earlier of
(a) Five (5) years from the closing date of the acquisition by
MTR Gaming Group, Inc. ("MTR") of all of the issued and
outstanding stock of Buyer [the "Acquisition"], (b) Six (6)
months following the death of XxXxxxx X. Xxxx, or (c) December
31, 2008.
3. Exercise of Option. Buyer shall exercise the Option to
Purchase by sending written notice thereof to Seller by
registered or certified mail or by delivering written notice
thereof to Seller by personal service.
4. Purchase Price and Terms. The Purchase Price for the Property
(the "Purchase Price") shall be the fair market value of the
Property ("Fair Market Value") . In the event that Seller and
Buyer are unable to agree upon Fair Market Value, each of
Seller and Buyer shall obtain an appraiser. These appraisers
shall appraise the Property and also jointly designate a third
appraiser to appraise the Property. For purposes of this
Agreement, Fair Market Value shall be the average of the two
closest appraisals. The parties shall share all appraisal fees
equally.
5. [Intentionally Omitted]
6. Evidence of Title. As a condition of Buyer's exercise of the
Option to Purchase, Buyer shall obtain at Buyer's expense a
title insurance policy from a nationally recognized company of
Buyer's choosing which shall insure to Buyer good and
merchantable title in fee simple, free and clear of all liens
and encumbrances, with access to publicly dedicated and
accepted highways and streets, without additional charge or
premium. At Closing, Seller shall transfer title to the
Property to Buyer by General Warranty Deed, free and clear of
all liens and encumbrances, with release of dower, if
applicable, with tender of the Purchase Price being evidence
of Buyer's
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performance hereunder. Documentary stamps, transfer or
conveyance fees shall be paid by Seller, and the costs of
recording the Deed shall be paid by Buyer. If the title to all
or part of the Property to be conveyed is defective or
unmerchantable, if access to a publicly dedicated highway or
street is unavailable, or if any part of the Property is
subject to liens, encumbrances, easements, conditions or
restrictions that affect Buyer's intended use of the Property,
or in the event of any encroachment, Seller shall have thirty
(30) days after written notice thereof, within which to obtain
access to a publicly dedicated highway and/or street or to
remove such defect, lien, encumbrance, easement, condition,
restriction, or encroachment. If Seller is unable to remedy or
remove, or to secure title insurance for a reasonable cost
against such defect, lien, encumbrance, easement, condition,
restriction or encroachment within said thirty (30) day
period, Buyer may elect to either: a) terminate this Agreement
or b) agree in writing to waive such defect, lien,
encumbrance, easement, condition, restriction or encroachment
and to proceed with the purchase of the Property Seller agrees
to indemnify, reimburse, protect, defend, and hold Buyer
harmless from any cost or damage, including reasonable legal
costs and fees, incurred or resulting from Seller refusing to
close or not being able to close under the terms and
conditions of this Agreement for any reason whatsoever,
without prejudice to Buyer's additional rights, if any, at law
or equity or both. Neither this Agreement or the acts of the
parties hereto shall be deemed to create a joint venture,
partnership, or other arrangement by which any party might be
deemed to be an agent of or liable for the acts of the other
party.
7. Property Liens. Seller warrants there are no outstanding liens
or encumbrances of any kind on the Property other than those
of record as of the date hereof. Seller agrees not to mortgage
or encumber the Property after the date of this Agreement. In
the event Seller does so mortgage or encumber the Property
after the date of this Agreement, Buyer may avail itself of
all remedies at law or equity or both.
8. Taxes and Assessments. Seller shall pay or credit on the
Purchase Price all delinquent taxes, including penalty
interest, all assessments which are a lien on the Closing
Date, and all unpaid real estate taxes not yet due for years
prior to closing, and a portion of such taxes for year of
closing prorated through Closing Date based on a 365 day year
and if undetermined, on the most recently available tax rate
and valuation. It is the intention of both parties hereto in
making tax proration to allow Buyer a credit as close in
amount as possible to the amount which Buyer will be required
to remit to the appropriate county agency for the period of
time through the Closing Date, giving effect to applicable
exemptions, recently voted milage, and change in valuation,
whether or not certified. Seller warrants that as of the date
hereof no improvements or services have been installed or
furnished, or notification received from any public
authorities of future improvements of which any part of cost
may be assessed against the Property. Seller shall pay all
accrued water, sewer, rental street cleaning, gas, electric
and other utility charges in connection with the Property
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as of the Closing Date. Any prepaid or committed utility,
zoning, municipal fees or permits affecting the Property will
be conveyed to Buyer at closing at no additional cost to
Buyer.
9. Possession. Seller shall be entitled to possession of the
Property until the Closing Date. On the Closing Date, the
Property is to be vacant and any leases will be terminated as
of the Closing Date. Seller shall be entitled to possession of
the Property until the Closing Date, provided, however, that
prior to the Closing Date, Buyer or Buyer's agent shall have
the right to enter upon the Property to make surveys, soil
tests, and other studies and examinations, provided Buyer
shall not unreasonably interfere with Seller's use of the
Property. Prior to Closing Date, in the event of damage or
destruction to or appropriation of the Property or portions
thereof or threats of said actions, for public use by any
governmental entity or agency possessing powers of
condemnation or eminent domain, Buyer shall have the right to
rescind this Agreement.
10. Representations and Warranties. Seller represents and warrants
that the following are true and correct in all material
respects as of the date hereof, and that such representations
and warranties will be true and correct in all material
respects as of the Closing Date:
a. Governmental Approvals: After Buyer has given notice
of its intent to exercise its option subject to
governmental approval, Seller agrees that Buyer may
apply to the appropriate governmental authorities
having jurisdiction thereof to secure subdivision
approvals, site plan approvals, issuance of building
permits, curb cut approvals, and various other
approvals and permits, necessary or desirable for the
development of the Property. Seller agrees to execute
all necessary documents and take all reasonable
actions as shall be necessary, and otherwise
cooperate with Buyer in connection with such
applications; provided, however, that Seller shall
not be required to record any documents relating to
rezoning prior to Closing which would, in the
reasonable opinion of Seller or its attorney,
adversely affect the continued use or future value of
the Property.
b. Assessments: Seller represents that as of the date
hereof, neither the Property nor any part thereof has
been affected, or is affected, by an assessment or
assessments which are or may become payable in annual
installments, whether or not the first is then a
charge or lien, or has been paid. In addition, there
have been no unconfirmed assessments affecting the
Property, with no ordinances having been adopted for
improvements affecting the Property, at or prior to,
the date hereof, and no improvements or work have
been commenced covering any improvements benefiting
the
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Property as of the date hereof.
c. Record Ownership: Seller is the record owner of fee
simple title to the Property.
d. Liens and Encumbrances. The Property currently is (or
will be as of the Closing Date) free and clear of all
liens, mortgages, deeds of trust, encumbrances,
easements, leases, conditions or other matters
affecting title except those of record as of the date
hereof.
e. No Adverse Ownership. No person other than Seller has
any right, title or interest in the Property other
than a leasehold interest as set forth on Exhibit B
attached hereto and made a part hereof.
f. Preservation of Title: From the date hereof to the
earlier of the Closing Date or the expiration of the
Option, Seller shall not, without in each instance
first obtaining the written consent of Buyer which
may be withheld in its sole and absolute discretion:
(i) voluntarily grant, create, or assume any lien,
lease, encumbrance, easement, covenant, condition,
right-of-way or restriction upon the Property or (ii)
voluntarily take any action adversely affecting title
to the Property as it exists on the date hereof.
g. Maintenance of the Property: From the date hereof to
the earlier of the Closing Date or the expiration of
the Option, Seller shall, at its expense, maintain
the Property and deliver the Property to Buyer at the
Closing Date in substantially the condition as it is
on the date hereof, reasonable wear and tear and
damage by fire or other casualty excepted.
h. Compliance with Laws: As of the date of this Option
Agreement, there are no violations of the laws,
ordinances, rules, or regulations of any governmental
authority having jurisdiction of the Property, nor
does Seller have knowledge of any facts which if
known by any such authority would cause a violation
to be placed thereon, and any notice of violation
affecting the Property at the date of exercise of the
Option and/or the date of Closing shall be complied
with by Seller, at its sole cost and expense, so that
the Property shall be conveyed free of same.
i. Environmental: Seller warrants and represents that:
(i) no Hazardous Materials are located on or in the
Property, including the surface, soil or subsurface
of the Property; (ii) Seller has received no notice
that Hazardous Materials contaminate or otherwise
affect the Property, and to its best knowledge, no
Hazardous Materials are present on any adjacent
Property; (iii) the Property has not been previously
used for the storage,
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manufacture, repair or disposal of Hazardous
Materials, or machinery containing such Hazardous
Materials; (iv) no complaint, order, citation or
notice with regard to air emissions, water
discharges, noise emissions, Hazardous Materials, or
any other environmental, health, or safety matters
affecting the Property, or any portion thereof, from
any person, government or entity, has been received
by Seller; and (v) all federal, state and local
environmental laws and regulations affecting the
Property and Hazardous Materials have been fully
complied with, and no heating equipment, incinerator
or other burning equipment installed or located in or
on the Property violates any law, ordinance, order or
regulation of any governmental authority.
j. Insolvency: Seller is not a party to any attachment,
execution proceedings, assignments for the benefit of
creditors, insolvency, receivership bankruptcy,
reorganization, or other proceedings pending against
Seller.
k. Absence of Default: Neither the execution and
delivery of this Option and the documents referenced
herein nor the consummation of the transactions
contemplated herein nor compliance with the terms of
this Option and the documents referenced herein
conflict with or will result in the material breach
of any terms, conditions or provisions of, or
constitute a default under, any bond, note or other
evidence of indebtedness or any contract, indenture,
mortgage, deed of trust, loan, partnership Option,
lease or other Options or instruments to which Seller
or any of its affiliates is a party or affecting the
Property or by which Seller may be bound.
12. Condition of Property. Seller agrees that no soil or
trees will be removed from the Property after the
Effective Date.
13. Commissions. The parties agree that no brokers have
been involved in the negotiation of this transaction
and that no party is entitled to a commission from
either party hereto.
14. Survival Clause. Seller and Buyer agree that this
Agreement shall survive the Closing Date and the
delivery of the General Warranty Deed until all terms
and conditions hereof are satisfied in full.
15. Default. Buyer's liability for breach of this Option
Agreement shall be limited to forfeiture of all
monies then having been paid to Seller hereunder,
which the parties agree shall constitute full and
complete liquidated damages for any default hereunder
by Buyer. In the event that Seller defaults
hereunder, Buyer shall be entitled to: (i) seek
specific performance; and/ or, (ii) seek relief from
any court at law or in equity.
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16. Notices. All notices required under this Agreement,
unless specifically defined elsewhere herein, shall
be given by registered or certified mail as follows:
Buyer: Seller:
Scioto Downs, Inc. Mara Enterprises, Inc.
Attn: Xxxxxx X. Xxxx Attn: XxXxxxx X. Xxxx
0000 Xxxxx Xxxx Xxxxxx ____________________
Xxxxxxxx, XX 00000 ____________________
17. Assignments. Buyer may assign its interest in this
Agreement prior to the Closing Date only to an entity
controlled by the Buyer without notice or approval of
Seller.
18. Closing. The sale of the Property contemplated
hereunder shall close within thirty (30) days after
exercise of the Option to Purchase ("Closing Date").
20. Successors and Assigns. This Agreement shall be
binding upon the successors, heirs, and assigns of
the parties hereto.
21 Governing Law. This Agreement shall be governed by
the laws of the State of Ohio without reference to
choice of laws rules.
22. Exclusivity. This Agreement and the Option to
Purchase is exclusive to Buyer. Seller shall not
grant any options to purchase the Property nor shall
Seller sell the Property to any other buyers during
the term of this Agreement.
24. Entire Agreement. This Agreement sets forth the
complete agreement between the parties hereto and
there are no other written or oral agreements not
contained herein.
IN WITNESS WHEREOF, the parties have set their hands hereunto
by their respective duly authorized representative as of the Effective
Date set forth above.
BUYER SELLER
SCIOTO DOWNS, INC. MARA ENTERPRISES, INC.
/s/ Xxxxxx X. Xxxx /s/ XxXxxxx X. Xxxx
------------------ -------------------
By: Xxxxxx X. Xxxx By: Xxxxxxx X. Xxxx
Its: President Its: President
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State of Ohio
County of Franklin, ss
Before me a notary public, in and for the State of Ohio,
personally appeared the above-named Xxxxxx X. Xxxx, the president of
Scioto Downs, Inc., an Ohio corporation and the Buyer hereunder, who
acknowledged that he did sign the foregoing instrument on behalf of
said corporation and that the same is their free and voluntary act and
deed on behalf of said corporation and their free and voluntary act and
deed.
IN TESTIMONY WHEREOF, I have hereunto subscribed my name and
affixed my official seal this 5th day of May, 2003.
/s/
_______________
NOTARY PUBLIC
State of Ohio
County of Franklin, ss
Before me a notary public, in and for the State of Ohio,
personally appeared the above-named XxXxxxx X. Xxxx, the president of
Mara Enterprises, Inc., an Ohio corporation and the Seller hereunder,
who acknowledged that she did sign the foregoing instrument on behalf
of said corporation and that the same is their free and voluntary act
and deed on behalf of said corporation and their free and voluntary act
and deed.
IN TESTIMONY WHEREOF, I have hereunto subscribed my name and
affixed my official seal this 5th day of May, 2003.
/s/
_______________
NOTARY PUBLIC
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EXHIBIT "A"
Legal Description
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