OF THIS AGREEMENT WILL BE
APPLIED TO ESTABLISH AN AVERAGE PURSE PER DAY FOR A BEGINNING GUIDELINE.
(C)
EXCEPT WITH RESPECT TO THE OVERPAYMENT IN
SECTION IN 3(F) OF THIS AGREEMENT, SHOULD A PURSE OVERPAYMENT OR UNDERPAYMENT
DEVELOP IN EXCESS OF $150,000, THEN THE PARTIES AGREE TO AUTOMATICALLY ADJUST
PURSES DOWN OR UP, IN THE NEXT PUBLISHED CONDITION BOOK, BY 5%.
THIS TRIGGERING
MECHANISM MAY BE WAIVED BY MUTUAL CONSENT OF THE PA HBPA AND ASSOCIATIONS.
(D)
IF, IN THE OPINION OF THE PENN NATIONAL
RACING SECRETARY, THE AGREED ADJUSTMENT IN THE CONDITION BOOK DOES NOT ALLEVIATE
THE OVERPAID PURSE CONDITION, THE ASSOCIATIONS HAVE THE RIGHT, AND ARE REQUIRED,
TO MAKE IMMEDIATE PURSE CUTS IN ACCORDANCE WITH FORMULAS MUTUALLY AGREEABLE, TO
5
ELIMINATE THE PURSE OVERPAYMENT.
THE ASSOCIATIONS, WITHOUT PREJUDICE, SHALL
HAVE THE RIGHT TO NOT EXERCISE THIS RIGHT, SHOULD THEY SO DESIRE.
(E)
IF, IN THE OPINION OF THE PA HBPA CONDITION
BOOK COMMITTEE, THE AGREED ADJUSTMENT IN THE CONDITION BOOK DOES NOT ALLEVIATE
THE UNDERPAID PURSE CONDITION, THE PA HBPA SHALL HAVE THE RIGHT TO REQUIRE THE
ASSOCIATIONS TO MAKE AND THE ASSOCIATIONS SHALL MAKE IMMEDIATE PURSE INCREASES
IN ACCORDANCE WITH FORMULAS MUTUALLY AGREEABLE, TO ELIMINATE THE PURSE
UNDERPAYMENT.
THE PA HBPA, WITHOUT PREJUDICE SHALL HAVE THE RIGHT NOT TO
EXERCISE THIS RIGHT, SHOULD IT SO DESIRE.
(F)
NOTWITHSTANDING SECTIONS 3(A), (C) AND
(D) OF THIS AGREEMENT, IN ANTICIPATION OF SLOT MACHINE REVENUE, THE ASSOCIATIONS
WILL IMPLEMENT PURSE INCREASES OF FIFTEEN (15%) PERCENT ON OCTOBER 27, 2004 AND,
TO THE EXTENT POSSIBLE, ANOTHER CHANGE (OR CHANGES) AT A DATE (OR DATES)
MUTUALLY AGREED UPON BY THE HBPA/ MANAGEMENT COMMITTEE (AT MEETINGS TO BE HELD
MONTHLY TO ADDRESS THIS ISSUE), ALL WITH THE OBJECTIVE OF ENSURING THAT THE
OVERPAYMENT DESCRIBED IN THIS SUBPARAGRAPH LASTS THROUGH THE COMMENCEMENT OF
SLOTS AT PNRC.
THESE INCREASES SHALL BE BASED ON THE PURSE STRUCTURE REFLECTED
IN THE CONDITION BOOK IN PLACE ON OCTOBER 1, 2004.
THE EFFECT OF THE PURSE
INCREASES SHALL BE PERIODICALLY MONITORED AND, TO THE EXTENT NECESSARY, ADJUSTED
BY THE PA HBPA/MANAGEMENT COMMITTEE TO ENSURE, AMONG OTHER THINGS, THAT THE
OVERPAYMENTS ARE SPREAD AS EVENLY AS PRACTICABLY BETWEEN THE EFFECTIVE DATE OF
THIS AGREEMENT AND THE EVENTUAL COMMENCEMENT OF OPERATIONAL SLOT MACHINES AT
PENN NATIONAL.
6
THIS PAYMENT SCHEDULE ASSUMES THAT SLOT MACHINES WILL BE OPERATIONAL AT PENN
NATIONAL BY APPROXIMATELY APRIL 1, 2006.
SHOULD THE APRIL 1, 2006 START DATE
REASONABLY APPEAR TO BE DELAYED, THE PARTIES WILL MUTUALLY AGREE TO EQUITABLY
ADJUST THE RATE OF OVERPAYMENT.
THE OVERPAYMENT, WHICH WILL NOT EXCEED
$4,000,000.00, WILL BE REPAID FROM PURSES WITHIN ONE (1) YEAR AFTER THERE ARE
2,000 OPERATING SLOT MACHINES AT PENN NATIONAL. IN THE EVENT THE COMMENCEMENT OF
OPERATIONAL SLOT MACHINES AT PENN NATIONAL IS SUBSTANTIALLY DELAYED OR
CANCELLED, THE PA HBPA SHALL REPAY THE OVERPAYMENT TO PENN NATIONAL BY WAY OF
PURSE REDUCTIONS OVER THE COURSE OF NO MORE THAN FOUR YEARS (IN PRO-RATA
AMOUNTS) BEGINNING ON JULY 1, 2007
4.
HORSEMEN'S BOOKKEEPER ACCOUNT
SECTION