Manfusos find two points of offer agreeable

November 27, 1993|By Ross Peddicord | Ross Peddicord,Staff Writer

There was some movement yesterday in the bitter racetrack ownership feud between Joe De Francis and his estranged partners, Tom and Bob Manfuso.

In a letter drafted by their attorney, Herb Garten, the Manfusos agreed to two of 11 points in a settlement offer that De Francis had proposed three days ago, but at the time was flatly rejected by the brothers.

The Manfusos agreed to provisions that would guarantee full payment on a promissory note by the purchaser of the sellers' shares, and that mutual releases would be signed relieving them from "any or all disputes" if they become the sellers, but not the buyers.

De Francis said this might "leave the door open" for more negotiations on the other nine key points in his proposal that the Manfusos did not address.

Garten, however, said much significance should not be placed in the Manfusos' response. He said the points agreed to are only related to the Russian roulette provision of a stockholders agreement that the Manfusos triggered Oct. 9 when they offered to sell their shares in Laurel and Pimlico race courses to De Francis for $8.2 million.

If De Francis doesn't buy the Manfusos' shares by Jan. 12, he would be contractually bound to sell them his shares at the same price, though the price is in dispute.

"There is an offer on the table," Garten said. "We are responsive to certain requests. Now all he [De Francis] has to do is tell us if he is a buyer or a seller."

De Francis repeatedly has said that he will not buy the Manfusos' shares in the two tracks or sell his stock to them unless the buy/sell agreement is accompanied by a complete settlement of all litigation and ownership disputes between the two sides.

In addition to the payment guarantees and mutual releases, De Francis contends that, based on the $970.42 price per share of the Manfusos' offer, his stock is worth approximately $8.8 million because he owns more shares in the tracks than the Manfusos.

He said he and his partner, Martin Jacobs, are also due an additional $2.8 million that they invested as principal in Pimlico, but said that money has not yet been paid to them. He added that when the Manfusos retired three years ago, they were reimbursed the $2.5 million in principal that they originally had invested in that track.

He also wants guarantees that whichever side buys the tracks will be supported by the seller in the Maryland Jockey Club's attempt to build a track in Virginia.

"What is troublesome is that they [the Manfusos] haven't addressed the Virginia issue in this response," said De Francis' attorney, Jim Gray. "It causes me to wonder what they are up to in Virginia."

The De Francis group contends that the Manfusos have joined forces with a rival group in Virginia, the Virginia Racing Associates, that plans to build a track in Portsmouth, but the Manfusos have denied it.

Meanwhile, De Francis said he is going ahead with plans to appeal the validity of the Russian roulette clause, which was upheld Aug. 6 by Baltimore City Circuit Court Judge Ellen Hollander.

Hollander has set a date of Dec. 10 to hear arguments as to whether her ruling should be certified as a final order. If the decision is certified, it paves the way for De Francis' appeal.

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