TORONTO, Feb. 10 /CNW/ - Baymount Incorporated ("Baymount" or the "Company") (TSX Venture: BYM) announces that it has closed on the first phase of its agreement with Macallan Equity Inc. ("Macallan") announced on January 22nd 2010, which refinances Baymount's subsidiary, Belleville Racetrack Development Corporation ("BRDC"). Under the agreement, Macallan provided BRDC with an initial advance of $3 million and has the right to acquire a 50% equity interest in BRDC upon investment of a further $1 million.
The $3 million was used for the purposes of refinancing Baymount's outstanding secured convertible debentures and other secured debt and to enhance the working capital positions of BRDC and Baymount. Baymount's secured convertible debenture has been paid down by approximately 50%, with the remaining principal evidenced by newly issued promissory notes maturing January 1st, 2012. Baymount's subsidiary BRDC has been released from the debenture obligation. The Baymount promissory notes remain secured by a second charge on Baymount's 55 acres of excess lands not being used by BRDC for the Quinte Raceway and Slots facility. The promissory notes accrue interest at 12% per annum with 0.625% per month of bonus interest accruing and due upon maturity or retirement of the promissory notes.
"This was a critical first step in refinancing our subsidiary, which is engaged in the development of the new Quinte Raceway and Slots facility in Belleville, Ontario," stated J. Graham Simmonds, President and CEO of Baymount. He added, "While the past year has been challenging, BRDC is now emerging much stronger and well positioned to execute on the development in Belleville. I would like to thank Macallan, our debenture holders, lenders, suppliers and all stakeholders of our Quinte development for their support in this refinancing effort and we look forward to now being able to move this project forward."
Baymount continues to hold a 100% interest in its 55 acres of excess lands adjacent to the new raceway development in Belleville, Ontario. These lands are not part of the transaction with Macallan and the Company continues to work with its prospective partners in developing these lands into a family entertainment destination, which plans to feature a new hotel and water park in addition to many other amenities.
Baymount seeks out and develops opportunities within the horseracing industry. It is the Baymount philosophy to create entertainment destinations for consumers while providing our investors with a vehicle that allows them to participate in the growth of Canadian gaming at racetracks.
Baymount's wholly-owned subsidiary, Belleville Racetrack Development Corporation ("BRDC"), has an agreement with the Belleville Agricultural Society to build a facility to relocate the Quinte Exhibition and Raceway ("QER") in Belleville, Ontario. QER is one of the 18 racetrack licenses in Ontario eligible to participate in Ontario's Slots-at-Racetracks program. In 2006, the Alcohol and Gaming Commission of Ontario found BRDC suitable to act as Landlord for the proposed OLG gaming premises to be located at the new QER. The Company has also received Preliminary Approval for a License to Operate a Racetrack from the Ontario Racing Commission.
ON BEHALF OF BAYMOUNT INCORPORATED
Graham Simmonds, President & Chief Executive Officer
For additional information please visit the company's website at www.bym.ca.
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This press release contains certain forward-looking statements with respect to the Company. These forward-looking statements, by their nature, involve risks and uncertainties that could cause actual results to differ materially from those contemplated. We consider the assumptions on which these forward-looking statements are based to be reasonable, but caution the reader that these assumptions regarding future events, many of which are beyond our control, may ultimately prove to be incorrect.
SOURCE BAYMOUNT INCORPORATED
For further information: For further information: Baymount Incorporated: Mr. Graham Simmonds, President and Chief Executive Officer, (416) 843-2881, firstname.lastname@example.org