Summary of Kentucky Kingdom LLLP Lease Agreement - 14 News, WFIE, Evansville, Henderson, Owensboro

Summary of Kentucky Kingdom LLLP Lease Agreement

Posted: Updated:

1. Kentucky Kingdom LLLP to invest $45 million to improve amusement park with opening in spring 2014.

$20 million in equity investment and a $25 million loan.  All improvements become property of Kentucky State Fair Board (KSFB).

$13 million to be invested in 2013 and 2014, of which $3 million going into debt reserve fund as required by Lender; $2 million invested upon completion of 2014 season; $2 million invested upon completion of the 2015 season; and $3 million invested upon completion of 2016 season. 

Development plan set out in No. 6 commences after 2017 season.

2. Lease is for a 50 year initial term with four additional five-year renewal options.

3. 57 acres plus a potential four acres for expansion of the water park.

4. Rent starts at $475,000 per year beginning in 2014 and increases $50,000 a year for 15 years until it caps out at $1.2 million for the remainder of the initial term.  KSFB receives 5 percent of the gross revenue in excess of $25 million for each operating year.
 
5. Parking - KSFB to pay Kentucky Kingdom $1.25 per visitor up to $450,000.   

6. Kentucky Kingdom to spend at least $1 million per year (for the remainder of the initial term of the lease) and capping out at $2.5 million a year or somewhere in between based on a formula that is based on projections.  All funds must be spent on park during initial term.  If park is sold (after KSFB approval), then KSFB gets all funds in maintenance reserve account.
 
7. All rides/improvements purchased with $45 million will become the property of the state.   Kentucky Kingdom may lease future rides with other development funds in order to leverage more new rides to increase attendance.  When the leased rides are paid off, they also become the property of the KSFB. 

8. Mortgage will be placed on property to secure a portion of the $25 million loan taken out
by Kentucky Kingdom with bank. This is pursuant to KRS 56.515. 

9. Lease can be sold with the consent of the KSFB to experienced park operator.

10. Lease may be terminated by either party within 90 days after execution if the financing package is not acceptable to either Kentucky Kingdom or KSFB.  Finance and Administration Cabinet and KSFB will be involved in negotiations with bank to ensure that the financing details are known to them during the financing acquisition phase.

11. After lease is signed, if park requires major unforeseen work not covered by Kentucky Kingdom's projections, it may terminate lease within 90 days of execution of lease.

(Source: Kentucky State Fair Board)

Powered by WorldNow