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Emerald Valley BMX <br /> Re: Emerald Valley BMX / Snooks / ABA ' �^ <br /> April 5.2004 <br /> Page 3 <br /> Prior to 2001, there are not even deposits that roughly correspond to most ofthe home <br /> games. There are some deposits that roughly correspond to a few of the games, but again <br /> there is no verifiable audit trail provided by the Snooks with regard to the parking income. <br /> We do know that since the departure of the Snooks gross receipts from parking have <br /> exceeded $34,000 with expectations of gross receipts of over $17,000 per football season in <br /> the future. It would appear there are very significant funds unaccounted for. These funds <br /> would have been almost entirely in the form of cash that could readily be pocketed. <br /> Potential remedies would be to ask the District Attorney to investigate this, to turn it <br /> in to the Internal Revenue Service, or to include it in any litigation. I doubt the District <br /> Attorney would be interested in this because it happened some time ago and the criminal <br /> justice system is down to basically prosecuting crimes of violence because of funding <br /> problems. The Internal Revenue Service would probably not be interested for the same <br /> reason. The Department of Justice found there was insufficient evidence to reach a firm <br /> conclusion about this issue, but I disagree with that conclusion. <br /> 5. Failure to Renew the City Lease. Mr. Snook allowed the lease contract with the <br /> City to expire, when he had represented to the City that he was the sole negotiator. This <br /> would not only be a breach of his contract, but a breach of the fiduciary duty he owed to <br /> Emerald Valley BMX. This has damaged Emerald Valley BMX because now portions ofthe <br /> parking revenue are required to be paid over to the City, and that is an open -ended issue that <br /> will exist throughout the term of the new lease. This should be included in any litigation <br /> commenced against Mr. Snook. Damages were $6,800 for the past two years for amounts <br /> paid to the City. Even if the City does not unilaterally increase its cut, which it can do, <br /> damages will be in the $34000 range over the life of the lease. <br /> CLAIM AGAINSTAMERICAN BICYCLE ASSOCIATION <br /> The claim against the Arnerican Bicycle Association would be for any role it played <br /> in interfering with the lease contract between Emerald Valley BMX and the City. Damages <br /> would be the same $34,000 referred to in paragraph 5 above. <br /> On November 8, 2001, the ABA sent a letter to Tim Rhay of the City in support of <br /> Mr. Snook and the job he was doing. Arguably this letter played an important part in the <br /> decision of the City not to deal with anyone other than Mr. Snook, which caused the lease <br />