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EXHIBIT 10.1
MARKETING REPRESENTATION AGREEMENT
THIS AGREEMENT is made the 24th day of June, 1998
BETWEEN
1 CHAMPIONSHIP AUTO RACING ITEMS, INC., 000 Xxxx Xxx Xxxxxx, Xxxx, Xxxxx
000, Xxxx, Xxxxxxxx 00000 ("CART"); and
2 ISL MARKETING AG, Xxxxxxxxxxxxxx 0, 0000 Xxxxxxx, Xxxxxxxxxxx ("ISL").
WHEREAS
A CART is the governing body of a number of international auto racing
series featuring open-wheeled racing cars and holds the world-wide
promotional, advertising and marketing rights in connection therewith.
B CART wishes to broaden and extend its existing relationship with ISL as
its exclusive marketing agent and representative for the promotion and
marketing of what is now known as the CART Federal Express Championship
Series ("FedEx Series") and other properties whose commercial rights
CART presently controls and ISL wishes to provide such services on the
terms hereinafter mentioned.
NOW IT IS HEREBY AGREED as follows:
1 APPOINTMENT OF ISL
1.1 Subject to the terms of this Agreement, CART hereby appoints ISL as its
exclusive representative for the solicitation and renewal on CART's behalf of
sponsorship agreements relating to the properties set forth below with companies
worldwide for the package of rights and opportunities set forth in Schedule A
hereto (the "Program") and ISL hereby accepts such appointment relating to:
(i) the FedEx Series,
(ii) individual races within the FedEx Series with regard to the
"Released Categories" listed in Schedule B hereto;
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(iii) the series presently known as the PPG Dayton Indy Lights
Championship (Indy Lights );
(iv) the series presently known as the Kool Toyota Atlantic
Championship ("Atlantics");
(v) any and all future properties created by CART or in which CART
acquires a majority interest and/or acquires control over the
commercial rights. Such properties shall include, but shall
not be limited to: virtual reality entertainment products,
race driving schools, Karting centers and other race series.
ISL accepts that CART's ability to grant such rights
exclusively to ISL may be limited by the terms under which
such properties and/or their commercial rights are acquired by
CART. This Agreement shall be modified to reflect the exact
circumstances regarding each acquired property once such
acquisition occurs. Notwithstanding the foregoing, CART
undertakes that no other agent will be engaged subsequent to
such an acquisition to market the commercial rights of the
property in question.
1.2 This Agreement supersedes the Marketing Representation Agreement dated
February 1, 1997 between CART and ISL attached hereto as Appendix A ("the
Original Agreement") in so far as it relates to calendar year 1999. However, the
Original Agreement shall remain valid in all other respects until 31 December
1998.
1.3 With regard to Indy Lights, ISL recognizes that the right to market
sponsorships independently of packages with FedEx Series rights remain with
Continental Sports, Inc. until September 1, 1998 ISL undertakes that it shall
not actively market rights for Indy Lights independently of FedEx Series rights
before that date.
1.4 CART undertakes to use its best efforts to enable ISL to include in the
Program certain other rights which may from time to time be required
with regard to a particular prospective sponsor, including but not
limited to driver personal services contracts, licensing agreements and
CART team sponsorship programs.
2. DUTIES AND OBLIGATIONS OF ISL
2.1 ISL shall commit its full resources as reasonably required in its marketing
of the Programme and shall work diligently to achieve sponsorship agreements on
behalf of CART.
2.2 ISL shall open an office within the CART Headquarters, presently located in
Troy, Michigan and shall place within that office the personnel wholly concerned
with the solicitation and renewal of CART sponsorships. CART shall provide ISL
with such office space free of charge provided that and for so long as it has
sufficient space within its facility to do so and does not need to acquire
additional space in order to accommodate ISL personnel. With regard to the
operational costs of such office, ISL shall pay CART only such sums as are
incurred in connection with the installation of telephone and telefax lines and
the use of such lines, and the cost of furniture and electronic equipment such
as computers, copiers and facsimile machines.
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2.3 ISL has, and shall exercise, no authority to make statements or
representations concerning the Program that exceed or are inconsistent with the
rights packages agreed between CART and ISL for a particular tier of
sponsorship. ISL has, and shall exercise, no authority to bind CART to any
undertaking or performance with respect to the Program.
2.4 ISL shall bear the cost of travel and entertainment, of the sales materials
and of all other expenses directly relating to its activities hereunder and
shall determine the content (subject to final approval by CART) and the
suppliers of such materials. ISL shall update such sales materials at least
every second year of this Agreement.
2.5 ISL undertakes not to enter into any new agreements during the term of this
Agreement to become the marketing representative/agent of any auto racing entity
for the sale of sponsorships in connection with automobile races or series in
the United States of America not sanctioned by CART. ISL also undertakes not to
extend or renew its existing agreements with NASCAR teams.
In addition, ISL undertakes not to enter into any agreement during the
term of this Agreement to become the marketing representative/agent of any auto
racing entity outside the United States of America for the sale of sponsorships
in connection with international, open-wheel, single-seat, over 1,000cc
automobile races or series.
3 COMPENSATION AND GUARANTEE
3.1 FEDEX SERIES, INDY LIGHTS AND ATLANTICS
3.1.1 In respect of calendar years 1999 and 2000, ISL guarantees
that it will generate the minimum sums specified in Schedule C
hereto ("the Overall Guarantee"), in cash and value in kind
actually received by CART (as defined in Schedule D) from
sponsorship agreements relating to the FedEx Series, Indy
Lights and Atlantics, failing which ISL shall pay CART the
difference between the amount actually generated for each
series and the said sums specified in Schedule C within thirty
(30) days of the end of the calendar year to which the
relevant portion of the Overall Guarantee applies. The values
of the product categories, the amounts payable by CART to race
organizing committees in respect thereof, the treatment of
unwanted value in kind, and the arrangements for payments are
set forth in Schedule D.
3 1.2 The amounts guaranteed in relation to Indy Lights and
Atlantics for calendar year 1999 is equal to the amount of
currently contracted sponsorship income for those series on
the date of signature of this Agreement. CART acknowledges
that ISL's guarantee for the said series for the year 1999
therefore fulfilled.
3.1.3 If either Xxxxx & Xxxxxxxxxx Inc. ("Kool") or Imperial Tobacco
Limited ("Player's") withdraws its sponsorship of Atlantics as
a result of current or pending legal restrictions on tobacco
advertising in the United States of America or Canada, then
the portion of the Overall Guarantee relating to Atlantics in
the year first
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affected by such withdrawal shall be reduced by an amount
equal to the amount of the lost sponsorship revenue.
3.1.4 Beginning in calendar year 2001, and except as provided for in
Clause 3.1.5 below, the amount of the Overall Guarantee shall
increase by five per cent (5 %) per annum per series over the
level of the preceding year's Overall Guarantee for the
duration of this Agreement.
3.1.5 If CART includes in the FedEx Series in any given year after
calendar year 2000 a fourth race outside the United States of
America and Canada, then the portion of the Overall Guarantee
relating to the FedEx Series for the year following the year
in which the race is held shall be increased by two and one
half per cent (2.5%) from the level specified in Clause 3.1.4.
This increase shall continue in each subsequent year in which
the number of races in the FedEx Series outside the United
States of America and Canada remains at four or more.
3.1.6 Once ISL has generated an amount in cash and value in kind
actually received by CART with regard to the FedEx Series
which is equal to the portion of the Overall Guarantee
relating to the FedEx Series, CART shall pay ISL one hundred
per cent (100%) of the amount generated by ISL in excess of
the portion of the Overall Guarantee relating to the FedEx
Series up to and including the sum of Six hundred thousand
dollars ($600,000) in 1999. This shall be paid as compensation
for ISL's costs of sale. In subsequent years of this
Agreement, the level of such compensation will be increased by
seven and one half per cent (7.5%) per year.
3.1.7 Once ISL has generated an amount in cash and value in kind
actually received by CART with regard to the FedEx Series
equal to the portion of the Overall Guarantee relating to the
FedEx Series determined for that year according to Clauses
3.1.1, 3.1.4 and 3.1.5 above and the compensation for costs of
sale for the relevant year of this Agreement (as specified in
Clause 3.1.6 above), all subsequent revenue generated by ISL
shall be divided equally between CART and ISL.
3.1.8 ISL shall receive no compensation on gross consideration
generated with regard to the FedEx Series, Indy Lights and
Atlantics, up to and including the levels of the respective
portions of the Overall Guarantee relating to each series.
3.1.9 With regard to gross consideration in cash or value in kind
generated by ISL and actually received by CART in respect of
Indy Lights or Atlantics in excess of the respective portions
of the Overall Guarantee, ISL shall receive a commission of
twenty per cent 20%) of the amount of gross consideration in
excess of the respective guaranteed amount up to a level of
gross consideration of ten per cent
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10%) in excess of the relevant portion of the Overall
Guarantee in 1999 and twenty per cent 20%) in excess of the
relevant portion of the Overall Guarantee thereafter ("the
Buffer Zone").
3.1.10 With regard to gross consideration in cash or in kind
generated by ISL in excess of the respective portions of the
Overall Guarantee and the Buffer Zone, all such consideration
shall be considered in every respect as income generated
relating to the FedEx Series and be treated as specified in
Clauses 3.1.6 and 3.1.7 above.
3.1.11 CART recognizes that ISL has agreed to the Overall Guarantee
on the understanding that its affiliated company, ISL
Television Limited ("ISL TV"), will be awarded all television
distribution rights for the FedEx Series, Indy Lights and
Atlantics upon expiration or earlier termination of CART's
existing agreements relating thereto. These rights shall be
awarded to ISL TV subject to ISL TV's making an offer for such
rights at fair market value (defined as an offer equal to or
exceeding the average of two or three competitive bids not
including that made by ISL). If CART fails to comply with this
understanding, ISL shall have the right to negotiate in good
faith for a commercially reasonable reduction in the Overall
Guarantee specified in Clause 3.1.1 beginning with the Overall
Guarantee relating to calendar year 2000. However, the
reduction in the Overall Guarantee for the year 2000 shall not
be applied to that year but rather to the Overall Guarantee
for the calendar year 2001, which shall be reduced by the
amount of the reductions for the calendar years 2000 and 2001
combined. The Overall Guarantee for calendar year 2002 shall
then be calculated using the formula in Clauses 3.1.4 and
3.1.5 above based on the Overall Guarantee for the calendar
year 2001 after the agreed reduction for calendar year 2001.
In the absence of agreement on such reduction, ISL shall be
entitled to terminate this Agreement without incurring any
liability to CART in so doing.
3.1.12 CART further recognizes that ISL has agreed to the Overall
Guarantee on the understanding that CART will use its best
efforts to secure early termination of its existing television
rights distribution agreements relating to the FedEx Series.
For the purposes of this Agreement, "best efforts" shall mean
CART's holding up to at least three (3) meetings with
individuals with authority to grant early release from each
agreement and the subject of release being a significant part
of such discussions. It is understood that CART's obligation
to hold such meetings shall be fulfilled if, at the first or
second meeting, CART receives an unequivocal refusal,
evidenced in writing, by the party concerned to agree to early
release. If CART fails to comply with this best efforts
undertaking by December 1, 1998, ISL shall have the right to
negotiate in good faith for a commercially reasonable
reduction of the Overall Guarantee beginning with the Overall
Guarantee relating to calendar year 2000. However, the
reduction in the Overall (Guarantee for the year 2000 shall
not be applied to that year but rather to the Overall
Guarantee for the calendar year 2001, which shall be reduced
by the amount of the reductions for the calendar years 2000
and 2001 combined. The Overall Guarantee for calendar year
2002 shall then
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be calculated using the formula in Clauses 3.1.4 and 3.1.5
above based on the Overall Guarantee for the calendar year
2001 after the agreed reduction for calendar year 2001. In the
absence of agreement on such reduction, ISL shall be entitled
to terminate this Agreement without incurring any liability to
CART in so doing.
3.2 ALL OTHER PROPERTIES
3.2.1 With regard to sponsorship revenues generated by ISL for the
properties specified in Clause 1.1(v) above, ISL shall receive
a commission of twenty per cent 20%) of the gross
consideration in cash or value in kind generated by ISL's
activities under this Agreement. There shall be no minimum
guaranteed revenues with regard to these properties.
3.2.2 With regard to revenues generated for individual CART races as
specified in Clause 1.1(ii) above, CART shall pay ISL a
commission of ten per cent 10%) of the value of the gross
consideration in cash or value in kind generated by ISL for
each individual race. Such income shall not be considered as
an "amount actually received by CART", as specified in
Schedule D, and shall not therefore count against the Overall
Guarantee.
3.2.3 With regard to the rights specified in Clause 1.4 above, CART
shall use its best efforts to ensure that ISL receives a
commission from the beneficiary of a minimum of ten per cent
(10%) of the value of the gross consideration, whether in cash
or in value in kind, payable to the relevant entity as a
result of ISL's efforts.
4 REPRESENTATIONS AND WARRANTIES
4.1 CART represents and warrants that it has the authority to
enter into this Agreement and to grant ISL the rights granted
hereunder.
4.2 CART represents and warrants that the execution and delivery
of this Agreement has been duly authorized by all necessary
corporate action of CART and the individual executing this
Agreement on behalf of CART has all requisite corporate
authority to act on behalf of CART and to make this Agreement
the valid and binding obligation of CART.
4.3 CART represents and warrants that it shall not itself sell or
seek to sell sponsorships and that it shall not appoint any
other marketing agent in connection with the sale of any CART
sponsorship.
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4.4 ISL represents and warrants that it has the authority to enter
into this Agreement and to perform its obligations hereunder.
4.5 ISL represents and warrants that the execution and delivery of
this Agreement has been duly authorized by all necessary
corporate action of ISL and the individuals executing this
Agreement on behalf of ISL have all requisite corporate
authority to act on behalf of ISL and to make this Agreement
the valid and binding obligation of ISL.
5 TERM, TERMINATION AND RENEWAL
5.1 The term of this Agreement shall commence on the date hereof and shall
relate to sponsorship agreements taking effect or operating with regard to the
1999 FedEx Series, Indy Lights Series and Atlantic Series. ISL will continue to
solicit sponsors for the 1998 FedEx Series under the terms of the Original
Agreement and may begin immediately to solicit sponsors for the 1999 FedEx
Series as provided for under this Agreement. This Agreement shall continue until
31 December 2007, unless sooner terminated as herein provided.
5.2 Either may terminate this Agreement forthwith by written notice:
(i) if the other party fails to observe or perform any of its
material obligations hereunder and does not remedy any such
failure within thirty (30) days after being called upon to do
so by written notice; or
(ii) if the other party becomes bankrupt or insolvent or enters
into liquidation (other than a voluntary liquidation for the
purposes of reconstruction, amalgamation or similar
reorganization) or enters into any arrangement or composition
with its creditors or any of them, or has receiver or
administrator appointed over all or part of its property or
assets.
5.3 Termination of this Agreement shall be without prejudice to any existing
rights and/or claims that the terminating party may have against the other, and
shall not relieve such other party from fulfilling the obligations accrued prior
to such termination.
5.4 In the event of ISL's failing to generate revenue equal to the Overall
Guarantee specified in Clause 3.1 in two successive years beginning in 2001,
either party shall have the option to give the other twelve (12) months' notice
in writing that it wishes to renegotiate in good faith the level of the Overall
Guarantee for the year following the end of the notice period, namely, 2004 at
the earliest.
5.5 CART hereby agrees to negotiate exclusively with ISL for a period of
six (6) months commencing on 15 January 2005 regarding the renewal of
this Agreement. If, within such six
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(6)-month period, the parties are unable to reach agreement on the
terms of a renewal, CART shall notify ISL in writing of the terms and
conditions of renewal which CART would be willing to accept. If, within
thirty (30) days of such notification, ISL does not accept such terms
and conditions, CART may contract with any third party, but on terms
and conditions no more favourable than those notified to ISL without
first giving ISL a further fourteen (14) days in which to accept of
reject such more favourable terms and conditions.
6 RELATIONSHIP OF THE PARTIES
This Agreement does not constitute either party the agent of the other,
or create a partnership, joint venture or similar relationship between
the parties, and neither party shall have the power to bind the other
party in any manner whatsoever.
7 CONFIDENTIALITY
7.1 The parties acknowledge that the terms and conditions of this
Agreement are confidential and agree to take whatever measures
are reasonably necessary to preserve such confidentiality,
unless disclosure is required by law. Nevertheless, such
information may be disclosed to the parties' attorneys,
agents, consultants, financial advisers and others with a need
to know in the ordinary course of business, provided that such
persons are placed under a similar obligation of
confidentiality. The contents of any press announcement
regarding any of the details of this Agreement shall be agreed
by CART and ISL before release. Neither party shall
unreasonably withhold its agreement to such announcements.
7.2 ISL acknowledges that all manuals, materials, systems,
procedures, techniques, rules and regulations, business
methods and any other communications and documents, trade
names, drawings, engineering or other data photographs,
samples, literature and all sale aids of every kind furnished
by CART to ISL or otherwise obtained by ISL are confidential
information and shall not be used, communicated or otherwise
transmitted directly or indirectly to others without the prior
written consent of CART. Upon the termination or expiration of
this Agreement, ISL shall return to CART all the
aforementioned and described items, and any other
communications and documents relating to the business of CART
that have come into the possession of ISL during the term of
this Agreement. The duties and obligations contained in this
paragraph shall survive the termination of this Agreement.
7.3 All media releases, public announcements and public
disclosures by either party or its employees or agents
relating to this Agreement, including but not limited to
promotional or marketing material, but not including any
announcement intended solely for internal distribution by
either party or any disclosure required by legal,
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accounting or regulatory requirements beyond the reasonable
control of the disclosing party, shall be coordinated with and
approved by the other party prior to the release thereof.
8 NOTICES
All notices, consents, approvals and statements hereunder shall be given in
writing to the respective addresses of the parties as first set forth above,
unless notification of a change of address is given in writing. Any notice shall
be sent by dispatch of telefax and confirmed the same day by registered mail and
shall be deemed received upon receipt of telefax.
9 WAIVER
Any waiver by either party of a breach of any provision of this Agreement shall
be in writing and shall not operate as or be construed to be a waiver of any
other breach of such provision or of any other provision of this Agreement.
Failure by either party to insist upon strict adherence to any provision of this
Agreement on one or more occasions shall not be considered a waiver or deprive
that party of the right thereafter to insist upon strict adherence to that
provision or any other provision of this Agreement.
10 ASSIGNMENT
Neither party may assign or transfer its rights or obligations under this
Agreement without the prior written consent of the other party. Any attempted
transfer or assignment in breach of this provision shall be void.
11 HEADINGS
The headings in this Agreement are for reference purposes only and
shall not in any way affect the meaning or interpretation of this
Agreement.
12 REMEDIES
Each and every of the rights, remedies and benefits provided by this Agreement
shall be cumulative and shall not be exclusive of any other such rights,
remedies and benefits, or of any other rights, remedies and benefits allowed by
law.
13 INTEGRATION AND SEVERABILITY
This Agreement, together with Schedules A, B, C and D and Appendix A hereto
(which form an integral part of this Agreement), is intended to be the sole and
complete statement of obligation of the parties as to the subject matter hereof
and supersedes all previous understandings, negotiations and proposals as to
such subject matter. This Agreement may not be altered, amended or modified
except in writing signed by a duly authorized representative of the parties
hereto. In the event of any one or more provisions contained in this Agreement
being held, for any reason, to be unenforceable in any respect under the laws of
any state or organization:
(a) such unenforceability shall not affect any other provisions of
this Agreement, and
(b) this Agreement shall be construed as if such unenforceable
provisions had not been contained therein, and
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(c) the parties shall negotiate in good faith to replace any
unenforceable provision by such enforceable provision as has
effect nearest to that of the provision being replaced.
14 GOVERNING LAW
The validity, interpretation and construction of this Agreement shall be
governed and construed by the laws of the State of Michigan. Any litigation
commenced by either party to this Agreement as the result of any alleged breach
of this Agreement shall be commenced in the circuit court for the County of
Oakland, State of Michigan, or in the appropriate lower district court in said
county, or in the U.S. District Court for the Eastern District of Michigan, and
the parties hereby consent to such personal jurisdiction.
15 COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of which shall
be deemed an original but all of which together shall constitute one and the
same instrument.
AS WITNESS the hands of parties hereto
For CHAMPIONSHIP AUTO RACING For ISL MARKETING AG.
TEAMS, INC.
By: /s/ Xxxxxx X. Xxxxx By:
-------------------------- --------------------------------
Name Printed: Xxxxxx X. Xxxxx Name Printed:
---------------- ----------------------
Title: President Title:
----------------------- -----------------------------
By:
-------------------------------
Name Printed:
----------------------
Title:
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SCHEDULE A
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PROGRAM
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The rights packages in respect of various levels of sponsorship will be
developed by CART and finalized with ISL's input. Such packages may, subject to
mutual agreement, include, without limitation, any or all of the following
rights:
i) entitlement status ("The FedEx Championship Series' or similar wording
to be defined");
ii) co-entitlement status ("The PPG Dayton Indy Lights Series" or similar
wording to be defined)
iii) category exclusivity;
iv) designation as Official Sponsor and Official Product or Service;
v) suppliership rights;
vi) logos on each car (title sponsor)
vii) option to purchase category-exclusive advertising rights on all race
telecasts;
viii) patches on drivers', crews' and officials' uniforms (title sponsor
only);
ix) patch on CART officials uniforms and on CART transporters and motor
homes;
x) prominent identification on the CART "Traveling Road show" display and
exhibit;
xi) race tickets and VIP credentials (to be determined in proportion to
contribution);
xii) hospitality credit for each race or access to CART hospitality area;
xiii) identification at the race on starting grid boards, Winners' Podium
backdrop and Media Center (title sponsor only);
xiv) the creation of premium items;
xv) CART Web-site recognition and hyper link to sponsor's home page;
xvi) access to CART market research studies;
xvii) use of CART marks for promotional use;
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xviii) identification in all CART-placed advertising, point-of-sale/display
materials, printed stationery, publications and TV programs;
xix) page of editorial and pages of advertising in each race program;
xx) expo area at each race;
xxi) trackside billboard(s);
xxii) identification on all promotional material for each race (title
sponsor);
xxiii) PA announcements;
xxiv) services of a CART Account Executive;
xxv) use of CART display program;
xxvi) such other rights as are mutually agreed between the parties.
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SCHEDULE B
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THE RELEASED CATEGORIES
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PAYMENT SYSTEMS
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PHOTOGRAPHIC FILM
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CONSUMER ELECTRONICS
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SNACK FOODS
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TELECOMMUNICATIONS
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EXPRESS DELIVERY
----------------
Copier / Fax / Printer
CONFECTIONERY
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SCHEDULE C
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OVERALL GUARANTEE
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1999
FedEx Series $14,100,000
Indy Lights $2,155,000
Atlantics $2,655,500
OVERALL GUARANTEE $18,910,500
2000
FedEx Series $15,500,000
Indy Lights $2,262,750
Atlantics $2,778,275
OVERALL GUARANTEE $20,541,025
* THESE FIGURES REFLECT THE REVENUE PAYABLE UNDER SPONSOR CONTRACTS EXISTING AT
THE DATE OF EXECUTION OF THIS AGREEMENT. IF CONTINENTAL SPORTS, INC. SELLS
FURTHER INDY LIGHTS SPONSORSHIPS BEFORE SEPTEMBER 1, 1998, THESE FIGURES SHALL
BE ADJUSTED ACCORDINGLY TO REFLECT CONTRACTED SPONSORSHIP REVENUES FOR 1999 AND
SUBSEQUENT YEARS AND WITH ANNUAL INCREASES IN THIS PORTION OF THE OVERALL
GUARANTEE BEING MADE IN ACCORDANCE WITH THE PROVISIONS OF CLAUSE 3.
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SCHEDULE D
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FINANCIAL DETAILS AND COMPENSATION
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1. Values of Product Categories
"Amounts actually received by CART" (as referred to in Clause 3 of this
Agreement), shall be defined as the gross consideration, whether in
cash or value in kind, generated through the sale of sponsorships by
ISL less an appropriate deduction to be paid to each race promoter for
the rights delivered to sponsors. This is currently envisaged as One
hundred thousand dollars ($100,000) per sponsor per race delivering the
full package of on-site rights set forth in Schedule A hereto for the
"Title" sponsor or "Partners". The exact amount of any deduction with
regard to payment for on-site rights delivery shall be subject to
mutual agreement between CART and ISL prior to the conclusion of each
sponsorship agreement.
"Amounts actually received by CART" shall also include any monies
received by CART from race promoters by way of indemnification for
cancellation of any races in the CART Series.
"Amounts actually received by CART" does not include the value in kind
element received by CART from sponsorship agreements existing on the
date of signature of this Agreement. However, should such deals be
renewed or renegotiated by ISL, then any incremental value in kind over
and above that received from a sponsor as part of their existing
contractual commitment to CART existent on the date of signature of
this Agreement, shall be treated as an "amount actually received by
CART".
2. Treatment of Unwanted Value in Kind
Any value in kind supplied as part of a sponsorship agreement solicited
by ISL will be considered commissionable unless CART provides written
notice to ISL prior to the conclusion of the relevant agreement that
the value in kind is unwanted, either in whole or in part. Should CART
subsequently use any or all of the previously notifies unwanted value
in kind, then it shall be deemed to have been wanted and be further
deemed to be commissionable.
3. CART Series Trust Account
(i) The parties shall jointly establish an account at a bank to be
agreed between them to be identified as the CART Series Trust
Account ("Trust Account") into which all receipts under this
Agreement shall be directed. Payments out of this Trust
Account shall be made by the Trustee Bank in accordance with
the terms of this Agreement and shall require authorized
signatures of both parties and both parties shall have full
access to the records relating to this Trust Account. The
costs associated with the Trust Account shall be borne equally
between the parties.
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(ii) ISL and CART shall pay, or cause to be paid, into the Trust
Account all monies received under sponsorship agreements
solicited by ISL and entered into by CART, and all monies
received by way of indemnification for race cancellation as
referred to in Paragraph 1 above.
