1.1 The name of the Syndicate shall be ‘Red Horse Bloodstock LLC ‘Aristides’ (“the Syndicate”).
1.2 The Syndicate shall constitute a syndicate for the purpose of owning and racing the horse to be purchased at the Keeneland September Sales 2018, “Colt X” (“the Horse”).
1.3. The Horse shall be registered in the name of the Syndicate and will carry the Syndicate’s colors.
1.4. The Horse was originally owned by Red Horse Bloodstock LLC of XXX (“the Parent Company”) By entering into this agreement, the Parent Company agrees. Subject to receipt in cleared funds of the Purchase Price (as defined below), to transfer part of its interest in the Horse Colt X to Share Owner XXX.
1.5 The Shareholder acknowledges that:
1.5.1 The Parent Company may have already divested part of its interest in the Horse to other shareholders who shall enjoy such share under an agreement on similar terms to this agreement; and
1.5.2 The wellbeing of the Horse shall be of paramount importance and the strategy for management and racing of the Horse shall be subject to the advice of the Horse’s Trainer, Veterinarians and Red Horse Bloodstock LLC.
2.1 This agreement shall take effect the date on which it has been signed by both the Parent Company and the Shareholder (“the Effective Date”).
2.2 Notwithstanding the commencement of this agreement in accordance with clause 2.1, any interest in the Horse shall not transfer to the Shareholder until the Parent Company has received the Purchase Price (as defined below) for the Horse from the Shareholder in cleared funds.
2.3 The Horse shall be purchased at the 2018 Keeneland Yearling Sales. The intention is that the Horse will be sold at the end of its 3 year old racing campaign, unless previously sold.
2.4 The normal method by which the Horse will be sold in anticipation of the Syndicate’s dissolution will be at public auction but the Manager shall be entitled, if he deems it to be in the best interests of Owners, to sell the Horse by any other method of sale.
2.5 In the event that the Owners unanimously decide, in respect of the Horse, that they would like such Horse to be retained to race as a 4yo, an additional management fee of $7,000 shall be payable to cover the training and expenses of the Horse’s 4 year old season.
2.6 If, with regard to the provision of 2.5, a unanimous decision of the Owners for renewal cannot be achieved, then the Manager, by a process of consultation among the Owners, shall be entitled to devise a mechanism, agreed by all Owners, whereby the Horse may be sold by the Syndicate, directly to such members of the Syndicate as wish to collectively purchase the Horse and, unless any other method of sale for such purposes is agreed, the relevant sale shall take place by way of public auction.
2.7 If the Manager considers that insufficient Shares have been sold prior to the 2018 Keeneland Yearling Sale, to make the Syndicate viable, then the Manager shall have the right to terminate this Agreement, whereupon monies paid by applicants for a Share or Shares shall be refunded but without interest due.
3 PRICE & PAYMENT
3.1 In consideration: (i) of the Parent Company transferring to the Shareholder a 5% share in the Horse; and (ii) for the Shareholder’s rights granted pursuant to this agreement, the Shareholder shall pay to the Parent Company the sum of $7,500 (“the Purchase Price”) immediately upon execution of this agreement for the period from the effective date to December 31st 2019.
3.2 The Share Owner shall make a 2nd payment of $6,000 for the period of January 1st 2020 to December 31st 2020. This payment is due by December 1st 2019.
3.3 All checks should be made payable to Red Horse Bloodstock LLC.
4.1 The Syndicate hereby irrevocably delegates to Mr. James Allen (“the Manager”) full and absolute authority to act, whether jointly or individually, on its behalf in taking decisions in respect of all matters relating to the Horse.
4.2 The Manager shall not, without first obtaining the authority of the Syndicate in accordance with clause 13, have authority to make decisions in respect of the following matters:
4.2.1 the sale of the Horse; or
4.2.2 the retirement of the Horse.
4.3 The Manager shall open, maintain and manage a bank account in the name of the Syndicate (“the Bank Account”). The Manager shall use such bank account solely for matters relating to the Horse and in accordance with the terms of this agreement.
4.4 The Manager will keep the Owners/Shareholders informed as to the purchase of the horse, the progress of the Horse in training and the races for which the Horse is entered. The Manager shall also arrange for the Share Owners to view the Horse in training and to attend race meetings.
4.5 The Manager shall exercise appropriate care in carrying out its role under these Terms and Conditions but cannot be held responsible for matters beyond its immediate control. The Owners will not be liable to make any other payments other than those specifically referred to in these Conditions and in the Application for a Share. No Owner shall have any claim against the Manager or against any other Owner in respect of any loss or injury sustained by the Horse, howsoever caused.
5.1 By virtue of the Shareholder’s interest in the Horse, the Shareholder is entitled to:
5.1.1 subject to clause 15.1, 5% of all owners' prize money won by the Horse (excluding
any taxes due). All such prize money: (i) received during the continuation of this agreement shall be distributed and paid out by the Manager in November of each year throughout the continuation of this agreement; and (ii) received following termination of the agreement shall be distributed and paid out by the Manager within 28 days of receipt of such money in cleared funds from the respective racetracks;
5.1.2 subject to clause 15.2, 5% of any re-sale value of the Horse on its sale (excluding
any taxes due) less any commissions due to any trainer of the Horse, any sales agents, any sales houses, any racecourses and any other third parties for such sale (the level of which may vary depending upon how the Horse is sold and other applicable circumstances). Any such re-sale monies shall be distributed by the Manager within 28 days of receipt of the sale monies in cleared funds; and
5.1.3 (1) owners badge (free admission to the Racetrack)on every occasion the Shareholder is present when the Horse is running.
5.2 Other than as expressly set out in this clause 5 and/or elsewhere in this agreement, the Shareholder shall have no other entitlements or rights by virtue of his or her shareholding or interest in the Horse.
5.3 The commitment of each Owner in respect of the Syndicate is for the Syndicate’s full duration, and except with the agreement of the Manager, no Owner shall be able to sell or transfer any share owned by that Owner before the Syndicate’s dissolution or otherwise to discontinue his or her membership of the Syndicate.
6.1 All costs relating to the Horse, including keep, veterinary treatment, training costs, travel to and from races, race entry fees, costs of disposal, costs of retirement and administrative costs of the Syndicate, shall be borne by the Syndicate from the purchase price of the share.
6.2 No other fees are due in respect of the syndicate, other than the annual payment detailed in 3, which is a ‘catch-all’ figure.
6.3 It shall be the responsibility of the Manager to ensure that the Syndicate operates within budget and the Shareholder shall in no circumstances be liable for any sums over and above those specifically mentioned in this agreement.
7.1 In the event that the Shareholder fails to make payment of the Purchase Price within 28 days of the Effective Date, this agreement shall terminate automatically and the Shareholder shall have no interest in the Horse whatsoever.
8.1 With a view to keeping the Shareholder’s costs to a minimum, the Syndicate and the Manager will not insure the Horse, and the Shareholder is responsible for insuring his/her interest in the Horse for such value, at his/her expense and against such risks as he deems necessary. The Manager shall, upon request provide such assistance as is reasonably required to enable the Shareholder to estimate the value of the Horse.
9 SHAREHOLDER’S RIGHTS AND OBLIGATIONS
9.1 The Shareholder’s interest in the Horse is personal and may not be sold, assigned, transferred, charged, mortgaged or dealt with in any other manner without the purchaser, assignee, transferee, charge or mortgagee of the interest or, in respect of any other dealings, the equivalent entering into an agreement with the Parent Company on materially similar terms to this agreement.
9.2 The Shareholder shall do nothing which the Parent Company reasonably considers to be:
9.2.1 prejudicial to the Parent Company’s goodwill, reputation and/or commercial interests; and/or
9.2.2 in any way abusive, intimidating or threatening towards the Manager, any employee(s) of the Parent Company or any other shareholder(s) in the Syndicate.
In the event the Shareholder acts in any way contrary to the terms of clauses 9.2.1 or 9.2.2, the Parent Company, on written notice to the Shareholder, reserves the right to forfeit the Shareholder’s interest in the Horse. In the event of forfeit in accordance with this clause, the Shareholder shall not be entitled to any refund of the Purchase Price or any amounts payable under clause 5 which fall due after the date of the notice issued by the Syndicate.
10.1 All entries in the press and at all Racetracks will be made in the name of the Syndicate.
10.2 Nothing in this agreement shall prevent the Shareholder from advertising his interest in the Horse, provided that, in any such marketing, publicity or press, reference is made to the Horse being owned by the Syndicate.
11 SALE OR RETIREMENT
11.1 The Horse may be entered for 'claiming' races and the Manager reserves the right to make executive decisions on this matter.
11.2 Unless agreed by the Syndicate acting by way of resolution in accordance with clause 13.1, the Horse will continue to race on behalf of the Syndicate.
11.3 The Horse may be sold or retired only if such sale or retirement is authorized by the Syndicate acting by way of resolution in accordance with clause 13.1.
11.4 If it is agreed by resolution of the Syndicate in accordance with clause 13.1 that the Horse should remain in the ownership of the Syndicate but an individual owner wishes to terminate their association, then the normal conditions of resignation (clause 12.6) shall apply.
11.5 In the event of the Horse sustaining life threatening injury, the Manager shall be authorized to make such decisions as it deems necessary in the best interests of the Horse’s health (which shall include the right to authorize the termination of the Horse). These decisions will be made in consultation with shareholders/owners wherever practicable.
12.1 The Shareholder may retire from the Syndicate and consequently surrender his/her interest in the Horse by serving not less than one month’s prior written notice on the Manager, such notice not to expire prior to the first anniversary of the Effective Date.
12.2 In the event of the Shareholder serving notice in accordance with clause 12.1, this agreement shall immediately terminate on the expiry of such notice. Following service of such notice, then upon expiry of any such notice (unless otherwise agreed in writing by the Manager(s) or Parent Company) the Shareholder’s interest in the Horse shall immediately revert to the Parent Company, without the
need for further documentation, and for no consideration.
12.3 In the event that the Shareholder’s interest in the Horse reverts to the Parent Company in accordance with clause 12.2:
12.3.1 the Parent Company shall take over the payments and be liable for all costs relating to that share in accordance with clause 6;
12.3.2 the Parent Company shall be entitled to the payments set out in clause 5; and
12.3.3 the Shareholder shall not be entitled to any refund of the Purchase Price.
12.4 For the avoidance of doubt, the Shareholder will have no entitlement to any other monies held in the Bank Account other than those due to the Shareholder in accordance with clause 5.
12.5 Upon expiry of the Shareholder’s interest in the Horse:
12.5.1 the Shareholder shall cease to be a member of the Syndicate; and
12.5.2 the Shareholder shall cease to represent himself or herself as having any interest in the Horse.
12.6 The Shareholder shall and shall use all reasonable endeavors to procure that any necessary third party shall, at the Shareholder's cost, promptly execute such documents and perform such acts as may be required for the purpose of giving full effect to the transfer of the Shareholder’s interest in the Horse in accordance with this clause 12.
13.1 Any resolution of the Syndicate shall be made if shareholders holding at least 65% of the Syndicate vote in agreement:
13.1.1 by email or in such other form of writing as is specified by the Manager and/or the Parent Company (as applicable) from time to time; and
13.1.2 within the voting period specified by the Manager and/or the Parent Company (as
13.2 If the Shareholder is unable for whatever reason to vote on any resolution in accordance with clause 13.1, he or she may appoint, by notice in writing to the Manager, another to vote by email or in such other form of writing as is applicable on his or her behalf.
13.3 On or prior to the Effective Date, the Shareholder shall, for the purposes of this clause 13 and for the purposes of providing or receiving any other notices or communications to be provided or received under this agreement, notify the Parent Company and the Manager(s) of his or her up to date contact details (including relevant address, fax number (if available) and email address and such other contact details as may be necessary). The Shareholder shall notify the Parent Company and the Manager(s) of any change in such details during the continuation of this agreement.
14.1 Should any dispute arise in relation to the ownership or management of the Horse, the Horse will continue to race without objection.
14.2 Any dispute between any two or more shareholders and/or any shareholder(s) and the Manager regarding the ownership or management of the Horse shall be decided by the Parent Company, whose decision shall be final and binding.
15 PARENT COMPANY
15.1 The Parent Company shall be entitled to 5% commission of gross prize money earned by the Horse.
15.2 The Parent Company shall be entitled to 5% commission of any future sale price of the Horse or the Shareholder’s interest in the Horse. If the future sale price of the horse is 5 times the amount originally paid by the Parent Company for the horse (“the Hammer Price”) or more, then the Parent Company shall be entitled to 7.5% commission of any future sale price of the Horse or the Shareholder’s interest in the Horse. If the future sale price of the horse is 10 times the Hammer Price or more, then the Parent Company shall be entitled to 10% commission of any future sale price of the Horse or the Shareholder’s interest in the Horse. The Hammer Price shall be defined as the sale price of the horse on the relevant Sales House’s website when purchased by the Parent Company or agents acting on behalf of the Parent Company. If the horse was not purchased through a Sales House then the Hammer Price will be defined as the pro-rated value of the Purchase Price in 3.1.
15.3 The parent company shall be entitled to 10% commission of any share sale during the term of this agreement.
16.1 Clause and paragraph headings shall not affect the interpretation of this agreement.
16.2 A person includes a natural person, corporate or unincorporated body (whether or not having separate legal personality) and that person's legal and personal representatives, successors and permitted assigns.
16.3 Words in the singular shall include the plural and vice versa.
16.4 A reference to writing or written includes faxes and e-mail.
16.5 Where the words include(s), including or in particular are used in this agreement, they are deemed to have the words without limitation following them. Where the context permits, the words other and otherwise are illustrative and shall not limit the sense of the words preceding them.
16.6 Any obligation in this agreement on a person not to do something includes an obligation not to agree, allow, permit or acquiesce to that thing being done.
16.7 This agreement cancels and supersedes any previous agreements the Shareholder may have had in respect of Red Horse Bloodstock LLC and Mr. AN EXAMPLE.
16.8 This agreement may be executed in counterpart, each counterpart when executed and delivered shall constitute an original of this agreement, but both counterparts shall together constitute the same agreement. No counterpart shall be effective until each party has executed at least one counterpart.
16.9 This agreement constitutes the whole agreement between the parties and supersedes all previous agreements between the parties relating to its subject matter.
16.10 Each party acknowledges that, in entering into this agreement, it has not relied on, and shall have no right or remedy in respect of, any statement, representation, assurance or warranty (whether made negligently or innocently) other than as expressly set out in this agreement.
16.12 Nothing in this clause 16 or elsewhere in this agreement shall limit or exclude any liability for fraud.
16.13 No variation of this agreement shall be effective unless it is in writing and signed by the parties (or their authorized representatives).
16.14 This agreement and any dispute or claim arising out of or in connection with it or its subject matter or formation (including non-contractual disputes or claims) shall be governed by and construed in accordance with the law of the State of Kentucky, United States.
16.15 The parties irrevocably agree that the courts of the State of Kentucky shall have exclusive jurisdiction to settle any dispute or claim that arises out of or in connection with this agreement or its subject matter or formation (including non-contractual disputes or claims).
16.16 Each Share Owner acknowledges that participation in the Syndicate is for purpose of sharing in the enjoyment of the Horse and although a financial return on investment is the strategy, it is not guaranteed.
16.17 Any intellectual property created by the arrangement to which these Conditions relate (whether deriving from the Horse, Syndicate or the Manager, shall belong to the Manager.
16.18 The Manager shall only process data relating to the Share Owners in a manner permitted by and consistent with Data Protection legislation and/or as permitted by the Share Owners.
16.19 The Share Owners, when funding their participation in the Syndicate, ate not purchasing goods or services and are not consumers for the purposes of Consumer Protection legislation.
16.20 The timing of the sale of the Horse, shall be at the Manager’s discretion but acting in what the Manager reasonably believes to be in the best interests of the Share Owners.
16.21 The Share Owner must understand that there are risks in Thoroughbred racing, including but not limited to injury to a horse that they may no longer be able to race, as well as sometimes the need to put the Horse to sleep. Horseracing is highly speculative, involves a high degree of risk and its results cannot be forecasted accurately. There is no assurance that you will recover your purchase price or realize any profit; nor is there any assurance that you will obtain purse earnings or that they will be in profitable quantities. Horses are live animals prone to injury, illness and various ailments. Even in good health, some horses perform better than others.
16.22 Each Share Owner will be responsible for any taxes due to their local, county, provincial, state or federal governments or any other taxing authority to which the Share Owner is responsible. We strongly advise you to seek the advice of a competent professional tax advisor.
16.23 The Horse’s Jockey will wear the racing colors of Red Horse Bloodstock LLC.
16.24 This Agreement shall be governed by and construed in accordance with the laws of the State of Kentucky and enforced without regard to conflict of law principles.
16.25 Each Share Owner shall execute and deliver any additional documents and instruments and perform any additional acts that may be necessary or appropriate or effectuate and perform the provision of this Agreement and the transactions contemplated herein.
16.26 To the fullest extent permitted by law, each Share Owner shall indemnify Red Horse Bloodstock LLC and hold them harmless from all losses, costs, liabilities, damages and expenses (including, without limitation, costs of suit and attorneys’ fees) they may incur on account of any material breach by Share Owner of this agreement.
16.27 If any provision of this Agreement or the application of such provision to any Person or circumstance shall be held invalid, the remainder of this Agreement, or the application of such provision to persons or circumstances other than those as to which it is held invalid, shall not be affected.
I have read and understand this agreement and I agree to abide by all the terms:
|Signed on behalf of Red Horse Bloodstock LLC||Signed by the Share Owner|