EXHIBIT 10.34
AGREEMENT
This Agreement ("Agreement") is made and entered into this 14th day of
February, 2003 between CART, Inc., a Michigan corporation, having its place of
business at 0000 Xxxxxxxx Xxxxxxx Xxxxx Xxxxx, Xxxxxxxxxxxx, XX 00000 ("CART")
and Xxxxxx Racing, 0000 Xxxxxxxxxxxx Xxxxx, Xxxxxxxxxxxx, XX 00000 ("TEAM").
W I T N E S S E T H:
WHEREAS, CART has sanctioned the 2002 FedEx Championship Series and will be
sponsoring the same type of series ("Championship Series") in 2003 ("Race
Year");
WHEREAS, CART desires to induce TEAM to enter a second race car exclusively
in the Championship Series in the Race Year and TEAM is interested in entering a
second race car upon the terms and conditions set forth herein;
WHEREAS, CART desires to obtain advertising and promotional services from
TEAM entry, referred to as race car entry number five (5), and TEAM is willing
to advertise and promote the Championship Series on the terms and conditions
hereafter set forth; and
WHEREAS, the parties desire to establish a mutually beneficial relationship
in accordance with the terms and conditions set forth herein.
NOW THEREFORE, in consideration of the premises and mutual covenants set
forth herein, the parties agree as follows:
1. TEAM shall prepare and enter and expend its mutual efforts to qualify
and race a second race car exclusively in the Championship Series, in
all of the races in the Race Year.
2. In consideration for TEAM's agreement to race in each of the races, and
in consideration of TEAM's providing promotional benefits through
advertising on the race car and other below enumerated promotional
services, CART agrees to pay TEAM the sum of Two Million
($2,000,000.00) Dollars during the 2003 race season. The payments will
be made The payments will be made as follows:
a. $750,000.00 upon signing (which has been paid);
b. $300,000.00 on March 15, 2003;
c. $250,000.00 on April 15, 2003;
d. $200,000.00 on May 15, 2003;
e. $250,000.00 on June 15, 2003;
f. $250,000.00 on July 15, 2003;
3. TEAM understands that the payment of the funds set forth in paragraph 2
above is intended to supplement TEAM's revenue so that TEAM has enough
funding to field a team during the Race year. In the event that TEAM
receives sponsorship revenue that totals more than Six Million Five
Hundred ($6,500,000.00) Dollars, TEAM will reimburse CART fifty (50%)
percent of all excess amounts until CART has been reimbursed the amount
set forth in paragraph 2 above. For purposes of this Agreement,
sponsorship revenue shall include all amounts given to TEAM under this
Agreement and the Entrant Support and Participation Agreement. So long
as this Agreement remains in effect, and for a period of one (1) year
thereafter, TEAM agrees to maintain complete and accurate books and
records containing information necessary to calculate the amount of
sponsorship funds connected. Upon at least ten (10) days written notice
by CART, TEAM shall allow a senior CART management person to review all
sponsorship contracts for the 2003 Season which has been raised for
TEAM race car entry number five (5).
4. Advertising spaces and promotional revenues sold to CART referred to in
paragraph 6 herein, may be purchased by TEAM provided such advertising
and promotions are not in use by CART, subject to CART's approval.
5. TEAM agrees to abide by all the rules and regulations of CART and the
series including but not limited to execution of the Entrant Support
and Participant Agreement.
6. TEAM agrees that it shall provide the following advertising and
promotional services to CART:
a. Advertising elements provided by TEAM shall be designated and
referred to as an "Associate Sponsorship". TEAM agrees that once an
associate sponsor or sponsors have been accepted by TEAM, no other
competing company will be assigned by the TEAM car entry benefiting
from this Agreement.
b. Identification Elements -
i. Logo identification on the race car in the following locations
and sizes:
- Front nose section (6 inches x 4 inches)
- Mid forward chassis location (12 inches x 4 inches)
- Engine cover (16 inches x 5 inches)
ii. Logo identification on the team transporter and race pit
equipment.
iii. Logo identification on Team/Driver uniforms.
iv. TEAM will further provide and promote CART logos on race cars,
transport vehicles, pit wall banner, driver and team uniforms,
team cars and a team website as well as link to xxxx.xxx.
v. Provide to CART and the associate sponsor, the team and driver
name and likeness for reasonable use for promotional purposes
related to the involvement by the sponsors in the Cart Racing
Series.
vi. Provide hospitality to the associate sponsor's guests at events
where the TEAM has such service. Five guests will receive
credentials, grandstand seating and access to team hospitality
when available. In addition, TEAM will supply to associate
sponsor's senior management, five (5) hard card full-season
credentials.
7. The term of this Agreement shall commence upon the date both parties
have executed this Agreement and shall continue until the end of the
2003 Race Year unless terminated prior thereto pursuant to the terms
hereof.
8. TEAM will not disclose, publish or disseminate confidential information
(which shall be defined as the terms of this Agreement) to anyone other
than those of their employees, attorneys and accountants with a need to
know and TEAM agrees to take such reasonable precautions as may be
necessary to prevent any unauthorized use, disclosure, publication,
dissemination of confidential information which shall include the terms
of this Agreement. In the event TEAM violates the provisions of this
paragraph, CART has the right to declare this Agreement null and void
and TEAM shall be required to refund any monies paid through that date.
Further, any press releases or public statements regarding the
relationship of the parties must be approved by CART.
9. The parties acknowledge the importance of each party's reputation, good
will and public image and, accordingly, agree to maintain and enhance
such image by restraining from taking any action contrary to the best
interest of either party, or detracting from the reputation of either
party. Each party shall refrain from making any statements about the
other party that adversely affects, casts in an unfavorable light, or
otherwise maligns the business or reputation of such other party or any
of its principals.
10. TEAM agrees that it will include in its diver's contract the following
language "Driver agrees that CART has a right of first refusal to meet
any offer Driver receives at the
expiration of this Agreement. CART must exercise this right within ten
(10) days of receipt from Driver of a bona fide offer."
11. TEAM will maintain throughout the length of this Agreement, commercial
general liability insurance (including but not limited to advertising
liability and contractual liability coverage applicable to the terms of
the indemnification provisions of this Agreement) covering claims for
personal and bodily injury, and property damage arising out of the
staging and performance of the races, with limits of at least Three
Million ($3,000,000.00) Dollars combined single limit per occurrence.
Each party shall specifically name CART as an additional insured.
12. TEAM agrees to indemnify, defend and hold harmless CART and any
sponsor's of CART whose logo may appear on TEAM's car from and against
any and all expenses, damages, claims, suits, actions, judgments, and
costs, including reasonable attorneys' fees arising out of or in
connection with the running of a car in any race during the Race year.
13. This Agreement shall be governed and construed in accordance with the
laws of the State of Indiana. If a dispute arises under this Agreement
which cannot be resolved first through good faith negotiations, such
dispute shall be submitted to arbitration and resolved by a single
arbitrator in accordance with the Commercial Arbitration Rules of the
American Arbitration Association then in effect. Such arbitration shall
take place at the office of the American Arbitration Association
located in Indianapolis, IN. The award of decision rendered by the
arbitrator shall be final, binding and conclusive and judgment may be
entered upon such award by any court. This provision shall survive the
termination and/or expiration of this Agreement.
14. This writing constitutes the entire Agreement between the parties
hereto regarding the subject matter hereof and may not be changed or
modified except by a writing signed by the party or parties to be
changed thereby.
15. This Agreement does not constitute and shall not be construed as a
consulting, partnership or joint venture between TEAM and CART. Neither
party shall have any right to obligate or bind the other party in any
manner whatsoever, and nothing herein contained shall give, or is
intended to give, any rights of any kind to any third party.
16. The failure of either party at any time or times to demand strict
performance by the other of any of the terms, covenants or conditions
set forth herein shall not be construed as a continuing waiver or
relinquishment thereof and each may at any time demand strict and
complete performance by the other of said terms, covenants and
conditions.
17. This Agreement has been jointly drafted by the respective
representatives of CART and TEAM and no party shall be considered as
being responsible for such drafting for the purpose of applying any
rule construing ambiguities against the drafter or otherwise. No draft
of this Agreement shall be taken into account in construing the
Agreement.
18. It is hereby understood and agreed to by CART and TEAM that any
statement or notice required to be given hereunder shall be deemed
given if mailed, certified mail, return receipt requested to the
following addresses:
If to CART: CART, Inc.
0000 Xxxxxxxx Xxxxxxx Xxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attn: X. Xxxxxxxx Peet, III
If to TEAM: Xxxxxx Racing
0000 Xxxxxxxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxx
19. This Agreement may be terminated in the event that:
(i) Either party to this Agreement files a petition in bankruptcy or a
petition in bankruptcy is filed against either party to this
Agreement that is not removed within thirty (30) days from the
date such petition is filed; a general assignment of either
party's assets is made for the benefit of creditors; or CART
dissolved or liquidates pursuant to Delaware state law or
otherwise.
(ii) Either party to this Agreement breaches any of the material
representations, warranties or covenants contained in this
Agreement, which breach is not cured by the breaching party within
thirty (30) days after receiving written notice of such breach
from the other party.
If the Agreement is terminated by TEAM pursuant to the terms of this
Paragraph 18, TEAM shall be entitled to retain all sums paid to it by
CART through the date of termination.
If the Agreement is terminated by CART pursuant to the terms of this
Paragraph 18, CART shall be entitled to immediately terminate any
future
payments to TEAM and shall be entitled to a refund by TEAM of all
monies previously paid under this Agreement.
20. Titles to articles, paragraphs and subparagraphs are for information
purposes only and shall not be considered a substantive part of the
Agreement.
21. This Agreement and any subsequent amendments may be executed in one or
more counterparts, each of which shall be deemed to be an original, but
all of which shall constitute one and the same agreement. This
Agreement and any subsequent amendments may be signed and delivered by
facsimile transmission, which delivery shall have the same binding
effect as delivery of the document containing the original signature.
At the request of any party, any document delivered by facsimile
signature shall be followed by or re-executed by all parties in
original form, provided that the failure of any party to do so will not
invalidate the signature delivered by facsimile transmission.
22. In the event that any provisions of this Agreement are found to be
invalid or unenforceable by any court of competent jurisdiction, such
provision may be deemed severed and any such finding shall not
invalidate or render unenforceable any other provisions hereof.
23. Each party shall comply with all governmental laws, ordinances, and
regulations applicable to the performance of this Agreement over which
said party has jurisdiction and control.
24. This Agreement may be unilaterally terminated by CART in the event CART
is unable to field eighteen (18) entrants in the 2003 Race Year or in
the event CART ceases to sanction races during the Race Year. In the
event of such termination, this Agreement shall be null and void with
no further obligations or liability on the part of either party.
25. This Agreement replaces the Agreement between the parties dated January
31, 2003. That Agreement is null and void.
CART, Inc.
By: /s/ Xxxxx Xxxxx
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Its: Chief Operating Officer
XXXXXX RACING
By: /s/ Xxxxxxx Xxxxxx
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Its: President
