Baymount Inc. (BYM.V: Quote) previously announced on May 4th 2012 that its wholly-owned subsidiary, Belleville Racetrack Development Corporation or "BRDC", had received a formal notice of termination of its Site Holder Agreement with the Ontario Lottery and Gaming Corporation or "OLG".
The company said that the Government of Ontario and the OLG announced earlier this year a significant change to the provincial gaming policy with the elimination of the "Slots-at-Racetracks" program. This change is part of a larger modernization plan for lottery and gaming in the province of Ontario. This modernization also includes a planned Casino for the Quinte West/Belleville area, which would effectively replace the planned Racetrack and Slots facility that was being developed by BRDC.
In the termination letter received by BRDC, the OLG suggested the parties meet to discuss the relevant financial considerations pursuant to the Site Holder Agreement. In the meantime, the Company has prepared an outline of the costs incurred, excluding land costs, and has submitted this to the OLG in advance of a meeting for discussion purposes.
OLG formally responded by letter to the Company on Friday July 20th with a proposal that was far below the Company's costs incurred on this project. The Site Holder Agreement calls for mediation as the first step to a resolution of any disputes. The company said it plans to pursue mediation while also evaluating potential litigation against OLG and others.
The OLG's proposal that the Company not receive adequate compensation or significant recouping of expenses is unacceptable, and the Company will take all necessary steps to resolve this situation in the best interests of its Stakeholders, Baymount said.
In 2004, BRDC entered into an agreement with the Belleville Agricultural Society to build a facility to relocate the Quinte Exhibition and Raceway or "QER" in Belleville, Ontario. QER was one of the 18 racetrack licenses in Ontario eligible to participate in Ontario's "Slots-at-Racetracks" program.
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by RTT Staff Writer
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