EXHIBIT 10
MOUNTAINEER PARK, INC.
Xxxxx 0, Xxxxx
X. 0. Xxx 000
Xxxxxxx, Xxxx Xxxxxxxx 00000
January 12, 1996
Xxxxxxx X. Xxxxxxx, CFO
Xxxxxxx Management & Development Corp.
Xxx Xxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
RE: Construction Loan Agreement between Xxxxxxx
Management & Development Corp., Mountaineer
Park, Inc. and Winner's Entertainment, Inc.
dated June 24, 1994, as amended (the "Loan")
Dear Xx. Xxxxxxx:
This letter sets forth the recent agreement between Xxxxxxx
Management & Development Corp., Mountaineer Park, Inc. and Winner's
Entertainment, Inc., relative to the Loan and Mountaineer Park, Inc.'s
need for more time to commence Loan amortization payments. The
undersigned, intending to be legally bound, agree:
1. With the understanding of both parties that Xxxxxxx Management
& Development Corp. never intended to be a permanent lender
but only to act as a construction lender Mountaineer Park,
Inc. and Winner's Entertainment, Inc. will cooperate with and
assist Xxxxxxx Management & Development Corp. in its
continuing efforts to sell the Loan to some third party and
will extend such cooperation and assistance so long as such
does not unreasonably interfere with Mountaineer Park, Inc.'s
day-to-day operations or unreasonably infringe upon
Mountaineer Park, Inc.'s need to protect its proprietary
information.
2. The Loan interest payment that would have been due on November
30, 1995, but for Xxxxxxx'x prior extension agreements, shall
be paid on or before January 16, 1996. The Loan interest
payment that would have been due on December 31, 1995, but for
Xxxxxxx'x prior extension agreements, shall be paid on or
before February 15, 1996.
3. The Loan payments due on January 31, February 29, March 31,
and April 30 of 1996 shall be payments of interest only and
shall be paid on or before each of said dates.
4. In the event all amounts owing to Xxxxxxx Management &
Development Corp., or its successors or assigns (the
"Lender"), pursuant to the Loan documents have not been paid
in full on or before May 31, 1996, then in such event,
principal and interest payments based on the 36-month
amortization specified in the Loan documents shall commence on
May 31, 1996, and shall be due and paid monthly on the last
day of each month thereafter for a total of 36 months. Be
assured that Lender will not be again requested by Mountaineer
Park, Inc. to delay the commencement of payments on the
principal.
5. The interest rate applicable to the Loan shall be 12.5%,
provided, however, that in the event any payment amounts due
and owing under the Loan, as altered by this letter agreement,
are delinquent, the interest rate applicable on the entire
outstanding principal for as long as such amounts remain
delinquent shall be the rate specified in paragraph 2.4 of the
Construction Loan Agreement, if said paragraph 2.4 rate would
then apply pursuant to its own terms. It is further agreed
that the enforcement of such "default rate" shall not preclude
the Lender from exercising any other rights or remedies
available to it under the Loan documents by reason of such
default.
6. In the event amounts owing to Lender pursuant to the Loan are
not paid in full on or before April 30, 1996, Mountaineer
Park, Inc. shall, prior to May 31, 1996, extend to Lender a
security interest in all of its assets except for (i) those
assets already covered by the Loan deed of trust, and (ii)
those assets which are covered by a prior lien accompanied by
covenants precluding a junior lienholder and for which consent
for a junior lien is unobtainable after a good faith effort by
Mountaineer Park, Inc., to secure same. Such security
interest will, to the extent not precluded by law or by a
prior non-consenting lienholder, include the right upon
default for Lender to be in receipt of funds otherwise flowing
to Mountaineer Park, Inc., and the discretion in favor of
Lender to apply such funds to the payment of sums due and
owing Lender under the Loan documents.
7. Mountaineer Park, Inc. agrees that between the date hereof and
the date it provides the additional collateral as contemplated
by paragraph 6 above, it will not grant or create a security
interest in such additional collateral in favor of any other
person or entity (except for purchase money security
interests) unless Lender, as a part of such transaction, has
been paid in full all amounts owing to it under the Loan
documents.
8. In the event some action is required to inform or seek
approval of this letter agreement from the West Virginia
Lottery Commission or the West Virginia Racing Commission or
any other West Virginia regulatory agency, then in such event,
Mountaineer Park, Inc. shall be solely responsible to
accomplish such and shall do so in such manner and upon such
schedule as Mountaineer Park, Inc. deems appropriate.
9. Except as amended, modified or altered by this letter
agreement, the documents evidencing the Loan and all terms and
provisions thereof shall remain in full force and effect.
Additionally, it is agreed that nothing contained in the
Mutual Release Agreement described in paragraph 11 below will
preclude Lender from pursuing and enforcing its remedies under
the Loan documents upon an occurrence of an event of default
as defined in Article VII of the Construction Loan Agreement.
Additionally, it is agreed that the benefits and obligations
existing by reason of a certain November 9, 1995 letter
agreement by and among Winner's Entertainment, Inc,
Mountaineer Park, Inc. and Xxxxxxx Management & Development
Corp. (and being a letter addressed to Xxxxx X. Xxxxxx) will
be at an end and will forever cease and terminate as of the
16th day of January, 1996.
10. In the event Lender shall initiate a foreclosure under the
Loan deed of trust based upon a failure to pay amounts owing
to Lender pursuant to the Loan documents, as altered by this
letter agreement, then in such event no action will be taken
by Mountaineer Park, Inc., or Winners Entertainment, Inc. by
legal proceedings or otherwise to delay, hinder or interrupt
the Lender in its foreclosure or other efforts of enforcing
its rights under said deed of trust. It is understood that
this covenant would not preclude and is not intended to
preclude Mountaineer Park, Inc. or Winners Entertainment, Inc.
from seeking the protections and benefits existing through
federal bankruptcy laws, if it should elect to do so.
11. As a part of the consideration for the benefits hereof, the
Mutual Release Agreement dated January 12, 1996, a copy of
which is attached hereto marked Exhibit A, shall be agreed to,
executed and delivered by Mountaineer Park, Inc., Winners
Entertainment, Inc., Xxxxxxx Management & Development Corp.,
and The Xxxxxxx Funding Group, Inc.
If the foregoing correctly sets forth our agreement, please cause
Xxxxxxx Management & Development Co. to sign the enclosed copy of this
letter and return the same to me.
Very truly yours,
WINNERS ENTERTAINMENT, INC.
By: /s/ Xxxxx X. Xxxxxxxx
------------------------------------------
Its: Pres.
------------------------------------------
MOUNTAINEER PARK, INC.
By: /s/ Xxxxx X. Xxxxxxxx
------------------------------------------
Its: Pres.
------------------------------------------
AGREED to as of the 12th day of January, 1996.
XXXXXXX MANAGEMENT &
DEVELOPMENT CORP.
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------------
Its: CFO
------------------------------------------
Letter Agreement
EXHIBIT "A"
MUTUAL RELEASE AGREEMENT
THE RELEASE EXTENDED BY MOUNTAINEER/WINNERS: The undersigned,
Mountaineer Park, Inc., and Winner's Entertainment, Inc. (herein
sometimes referred to collectively as "Mountaineer/Winners"), for and in
consideration of the execution and delivery by Xxxxxxx Management &
Development Corp. and The Xxxxxxx Funding Group, Inc. of this Mutual
Release Agreement, and for other good and valuable consideration,
including, but not limited to, $100.00 cash in hand paid by Xxxxxxx
Management & Development Corp. and The Xxxxxxx Funding Group, Inc. to
Mountaineer Park, Inc. and Winner's Entertainment, Inc., the receipt and
sufficiency of all of which are hereby acknowledged, and subject to the
limitations hereinafter set forth, hereby RELEASE and FOREVER DISCHARGE
Xxxxxxx Management & Development Corp., and The Xxxxxxx Funding Group,
Inc., and their officers, directors, shareholders, employees, agents,
servants, attorneys, successors, assigns, insurers, heirs and personal
representatives, subsidiaries, and each and every other corporate or
other type entity affiliated directly or indirectly with The Xxxxxxx
Funding Group, Inc. ("Xxxxxxx affiliated entities"), and also their
officers, directors, shareholders, employees, agents, servants,
attorneys, successors, assigns, insurers, heirs and personal
representatives, of and from any and all claims, suits and causes of
action of whatsoever kind or character Mountaineer/Winners, or either of
them, now has or may hereafter have, by reason of any damages, losses or
expenses incurred or to be incurred and of whatever kind or character by
the undersigned Mountaineer Park, Inc. or Winner's Entertainment, Inc.,
arising from or growing out of or in any way related to (i) the borrower
lender relationship between Mountaineer Park, Inc. and Xxxxxxx Management
& Development Corp., or (ii) the relationships between or among any of
the undersigned or any of the other parties released by this or the
following paragraph ("other relationships") arising by reason of or
growing out of or in any way related to said borrower-lender relationship
between Mountaineer Park, Inc. and Xxxxxxx Management & Development Corp.
THE RELEASE EXTENDED BY XXXXXXX/XXXXXXX: The undersigned,
Xxxxxxx: Management & Development Corp. and The Xxxxxxx Funding Group,
Inc. (herein sometimes referred to collectively as "Xxxxxxx/Xxxxxxx"),
for and in consideration of the execution and delivery by Mountaineer
Park, Inc. and Winner's Entertainment, Inc., of this Mutual Release
Agreement, and for other good and valuable consideration, including, but
not limited to, $100.00 cash in hand paid by Mountaineer Park, Inc. and
Winner's Entertainment, Inc. to Xxxxxxx Management & Development Corp.
and to The Xxxxxxx Funding Group, Inc., the receipt and sufficiency of
all of which are hereby acknowledged, and subject to the limitations
hereinafter set forth, hereby RELEASE and FOREVER DISCHARGE Mountaineer
Park, Inc. and Winner's Entertainment, Inc., and their officers,
directors, shareholders, employees, agents, servants, attorneys,
successors, assigns, insurers, heirs and personal representatives,
subsidiaries, and each and every other corporate or other type entity
affiliated directly or indirectly with Winner's Entertainment, Inc.
("Winner's affiliated entities"), and also their officers, directors,
shareholders, employees, agents, servants, attorneys, successors,
assigns, insurers, heirs and personal representatives, of and from any
and all claims, suits and causes of action of whatsoever kind or
character Xxxxxxx/Xxxxxxx, or either of them, now has or may hereafter
have, by reason of any damages, losses or expenses incurred or to be
incurred and of whatever kind or character by the undersigned Xxxxxxx
Management & Development Corp. or The Xxxxxxx Funding Group, Inc.,
arising from or growing out of or in any way related to (i) the borrower-
lender relationship between Mountaineer Park, Inc. and Xxxxxxx Management
& Development Corp., or (ii) the relationships between or among any of
the undersigned or any of the other parties released by this or the
preceding paragraph ("other relationships") arising by reason of or
growing out of or in any way related to said borrower-lender relationship
between Mountaineer Park, Inc. and Xxxxxxx Management & Development Corp.
LIMITATIONS: By way of clarification, if needed, the
undersigned declare it to be their understanding and intentions that
whether or not the said borrower-lender relationship is ended on or
before January 15, 1996, the acts and omissions of the undersigned, or
any of them, in the performance of their obligations under or related to
the loan documents evidencing said borrower-lender relationship occurring
prior to January 15, 1996, shall never be or become the basis of (or a
part of the basis of) a claim, suit or cause of action by or against any
of the undersigned. However, it is agreed that the releases hereby
extended will not preclude a claim, suit or cause of action by any of the
undersigned, nor an enforcement of remedies available to Xxxxxxx
Management & Development Corp. (or its successors or assigns) under said
loan documents, so long as such claim, suit, cause of action or
enforcement of remedies is based solely upon a breach of obligation, or
breach of duty, or failure to pay or failure to perform occurring on or
after January 15, 1996 (e.g., the failure of Mountaineer Park, Inc. to
timely tender the January 15, 1996 interest payment would be a failure
for which Xxxxxxx Management & Development Corp. could pursue a claim,
suit, cause of action or an enforcement of its remedies under said loan
documents).
Mountaineer/Winners understand and agree that the aforesaid
claims hereby released by them include, but are not limited to, any
claims and possible claims stated in, implied by or inferred from (i) the
content of a certain letter dated September 25, 1995, from Mountaineer
Park, Inc. to Xxxxxxx Management & Development Corp. (signed by Xxxxx X.
Xxxxxxxx and addressed to Xxxxx X. Xxxxxx) , and (ii) the content of a
certain letter dated September 6, 1995, from Mountaineer Park, Inc. to
Xxxxxxx Management & Development Corp. (also, signed by Xxxxx X. Xxxxxxxx
and addressed to Xxxxx X. Xxxxxx). Mountaineer/Winners further understand
and agree that the aforesaid Xxxxxxx affiliated entities hereby released
include, but are not limited to, American Gaming & Entertainment, Inc.,
Gamma of West Virginia, Inc., and Gamma International, Ltd., insofar as
claims, suits and causes of action by the undersigned would relate
directly or indirectly to the loan which is the basis of the aforesaid
borrower-lender relationship.
The undersigned hereby declare that the terms of this Release
have been completely read and are fully understood and voluntarily
accepted for the purpose of making a full anti final compromise,
adjustment and settlement, subject to the above-stated limitations, of
any and all claims, disputed or otherwise, known or unknown, discovered
or not discovered, on account of said borrower-lender relationship or
said other relationships and for the express purpose of precluding
forever, subject to the above-stated limitations, any further or
additional claims, demands or suits against any and all entities and
persons named or referred to herein as a released party, arising out of
the aforesaid borrower lender relationships or said other relationships.
The undersigned understand and agree that the aforesaid
payments of cash and execution and delivery of this Mutual Release
Agreement were made by way of settlement and that liability for any
claims hereby released have been and are specifically denied by the
parties released hereby.
The undersigned represent and warrant that the terms hereof
were reached by them after full and complete opportunity to consult with
counsel regarding the settlement and the effect of this release; that
they execute this release voluntarily, freely, without compulsion or
duress and mindful that it has legal consequences precluding any further
action, subject to the above stated limitations, on any claim they have
or might have as to said borrower-lender relationship or said other
relationships against the parties released; and that no person has made
any promise or given any inducement whatsoever to encourage them to make
this settlement other than the considerations above recited; and, that
(i) no limitation or restriction exists as to the power or the authority
of the undersigned to execute this release, (ii) the persons executing
same on behalf of the undersigned have been duly authorized so to do, and
(iii) this release is valid and binding and the provisions hereof are
enforceable against the undersigned in accordance with its terms.
This Mutual Release Agreement may be executed in any number of
counterparts, each of which shall, for all purposes, be deemed to be an
original, but all such counterparts shall together constitute one and the
same instrument.
WITNESS the following signatures as of the 12th day of
January, 1996.
MOUNTAINEER PARK, INC.
By:
---------------------------------
Its:
---------------------------- --------------------------------
Witness
WINNER'S ENTERTAINMENT, INC.
By:
---------------------------------
Its:
---------------------------- --------------------------------
Witness
XXXXXXX MANAGEMENT & DEVELOPMENT CORP.
By:
---------------------------------
Its:
---------------------------- --------------------------------
Witness
THE XXXXXXX FUNDING GROUP, INC.
By:
---------------------------------
Its:
---------------------------- --------------------------------
Witness
