If slot machines are permitted at Maryland's racetracks, the profits will flow to people far and wide -- including some with no involvement in the tracks.

Louis Guida of Vero Beach, Fla., for example. He headed a group of 16 silent partners, most living in New Jersey and associated with late track owner Frank De Francis. They sold their 41 percent of Laurel Park this year to the Magna Entertainment Corp. but retained a claim on any slot proceeds.

Similarly, Leucadia National Corp., a New York-based conglomerate with holdings in insurance, wineries and copper mines, is assured one of the biggest paydays because of its 40 percent former stake in Laurel and Pimlico Race Course, which it sold for $28 million. Martin Jacobs, a former treasurer of Laurel and Pimlico Race Course, also stands to receive a hearty slice of the slots pie.

The former investors are included, along with Joseph A. and Karin De Francis, who held the majority of a voting class of track stock before the Magna sale, in a side agreement disclosed by Magna in a Dec. 12 filing with the Securities and Exchange Commission.

Legislation required

Estimating how much -- if any -- money anyone will get is impossible until the General Assembly decides if slots will be permitted and, if slots are allowed, how the revenue will be distributed. If they follow the pattern of other states, Maryland lawmakers will treat the slot proceeds like a wagering takeout and designate percentages to specific purposes.

At Delaware Park, for example, about 90 percent of the money played in slot machines is returned to bettors as winnings. Of the rest -- amounting to $350 million last year -- 49 percent went to the track, 35 percent to the state, 11 percent to purses and 5 percent to slots overhead.

Whatever flows back to the owners of Pimlico and Laurel will be governed by the General Assembly and by an agreement hammered out between De Francis and Magna during their negotiations last spring and summer. It calls for the creation of a separate entity, to be called Maryland Ventures LLC, to receive the proceeds of any slot revenues designated to the tracks.

For each dollar in pretax, net earnings generated by Maryland Ventures, Magna will keep 35 cents and the previous owners will get 65 cents during the first five years of slots operation. The previous owners' share will drop to 50 percent for the next five years, then fall to 40 percent for the next 10 years. After that, 20 years after the debut of slots, Magna keeps everything.

No guarantee of profit

Joseph De Francis, in a statement released by Magna, says there is no guarantee of a profit, and notes that the share that will be paid to him and the former owners will likely be whatever remains after the state, horsemen and other designees get their share.

De Francis pointed out that they still own 49 percent of the tracks' stock, and might be expected to get 49 percent of any slot profits. They accepted the lower payout in exchange for options that permit Magna to buy the rest of their stock, or permit the siblings to demand Magna buy them out, for $18.3 million.

The price of the options, already paid to them by Magna: $18.4 million.

"The bottom line is that my sister and I will receive a smaller percentage of the net profits, if any, after the payment of all relevant expenses ... than we would otherwise have been entitled to," Joseph De Francis said in the statement.

Leucadia's executive in charge of the investment, Lou Medeiros, and Guida did not respond to requests for comment.

Here's the breakdown in how Maryland Venture's share will be distributed:

In the first five years, Magna will get 35 percent; Leucadia will get 19.11 percent; the Guida group will get 16.25 percent; Karin De Francis, Joseph's sister, will get 12.55 percent; Joseph De Francis, 11.74 percent; Martin Jacobs, 5.35 percent.

In the sixth to 10th years, the breakdown will be: Magna, 50 percent; Leucadia, 14.7 percent; the Guida group, 12.5 percent; Karin De Francis, 9.65 percent; Joseph De Francis, 9.03 percent; Martin Jacobs, 4.11 percent.

In the 11th through 20th years: Magna, 60 percent; Leucadia, 11.76 percent; Guida, 10 percent; Karin De Francis, 7.72 percent; Joseph De Francis, 7.23 percent; and Martin Jacobs, 3.29 percent.

Sun staff writer Greg Garland contributed to this article.