AGREEMENT BETWEEN PARTIES
This Agreement is made effective and entered into this 1st day
of October, 1996 by and between ▇▇▇▇▇▇▇▇ Motorsports, Inc., an Oregon
corporation, hereinafter referred to as ("▇▇▇▇▇▇▇▇"), and SC&T Racing
Enterprises Limited, an Arizona corporation, hereinafter referred to as ("SC&T
Racing").
WHEREAS ▇▇▇▇▇▇▇▇ runs, owns and operates a professional
formula Atlantic Team;
WHEREAS ▇▇▇▇▇▇▇▇ desires to compete in the 1997 Player's
Toyota Atlantic Series, and plan for the 1998 season before the final venue of
the 1997 season, and SC&T Racing desires to promote its name and products and
become a sponsor;
NOW THEREFORE, in consideration of the mutual covenants and
agreements between the parties and other good and valuable consideration, the
parties hereto agree as follows:
1) ENTRY
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▇▇▇▇▇▇▇▇ agrees to send in the entry as early as possible to
maximize SC&T Racing's exposure in program printing, press
releases and any other official race public relations
documents. All press materials from ▇▇▇▇▇▇▇▇ must have pre-
approval by SC&T Racing prior to release. Press materials will
be on hand at each race venue.
2) CONTRIBUTION OF PARTIES
-----------------------
▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇▇ agrees to maintain, repair and replace, as necessary,
one (1) Ralt RT-41 Atlantic car and engines with electronic
fuel injection for approximately 48/50 days of testing and
racing. Said car shall be maintained race-ready and in
competitive condition with standards equal to or greater than
a performance rating equal to or greater than any of the other
top competitors in the Series. ▇▇▇▇▇▇▇▇ shall supply tires as
needed for the races and as needed for testing. ▇▇▇▇▇▇▇▇ shall
supply a minimum of two mechanics per car plus a team manager.
▇▇▇▇▇▇▇▇ shall provide a sufficient number of qualified
mechanics and all other personnel required to maintain and
operate the car in good and attractive order, as well as all
other additional incidental equipment required to properly
support the car and its activities. ▇▇▇▇▇▇▇▇' fees include
management, logistics, transportation, consulting,
preparation, car engineering and driver development, and also
pays for mechanics' lodging and all other expenses.
▇▇▇▇▇▇▇▇ will install eight (8) flags on the trailer in the
logo and colors of SC&T Racing.
▇▇▇▇▇▇▇▇ will provide a hospitality area that will accommodate
up to 15 people. This area will be decorated with the logo and
colors of SC&T Racing. Food and beverage also will be provided
at each venue.
▇▇▇▇▇▇▇▇ will reserve six (6) hotel rooms at each race venue
for SC&T Racing attendees. Payment for these rooms will be the
responsibility of SC&T Racing. ▇▇▇▇▇▇▇▇ also will identify a
key special events manager for SC&T Racing during the race
season as lead contact between ▇▇▇▇▇▇▇▇ and SC&T Racing.
It is the goal of the parties to make every effort possible to
win the race and the Series Championship. ▇▇▇▇▇▇▇▇ agrees to
show its due diligence at all times and make maximum effort to
provide the necessary equipment and team to accomplish this
goal.
Consideration
-------------
In consideration therefor, and provided ▇▇▇▇▇▇▇▇ is not in
default, SC&T Racing agrees to provide ▇▇▇▇▇▇▇▇ $605,000 (US)
for the 1997 season with payment as follows: $150,000 Deposit
of Intent, upon signing this agreement. The balance will be in
monthly payments due on the 5th day of the months as follows:
December, 1996 $100,000; January, 1997 $50,000; February, 1997
$50,000; ▇▇▇▇▇, ▇▇▇▇ $42,000; April, 1997 $42,000; May, 1997
$42,000; June, 1997 $42,000; July, 1997 $42,000; and the final
payment August 1997 of $45,000. All payments will be made by
bank transfer after the Deposit of Intent payment. There will
be no other expenses, liabilities, or charges to SC&T Racing
unless specifically contained herein or in a written agreement
signed by SC&T Racing. If, for any reason, ▇▇▇▇▇▇▇▇ is unable
to continue for the full racing season, the consideration will
be prorated as to the actual number of events run.
3) PRIZE MONEY
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▇▇▇▇▇▇▇▇ agrees that 10% of all prize money will be paid to a
charity as specified by and in the name of SC&T Racing. All
remaining prize monies and contingencies will go to ▇▇▇▇▇▇▇▇
for distribution to team members and operating expenses as
deemed necessary.
4) SPONSORSHIP
-----------
In case of accident and/or health problems, ▇▇▇▇▇▇▇▇ will
choose a replacement driver, subject to the prior approval of
SC&T Racing. Both parties acknowledge
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that the sponsors belong to SC&T Racing, and ▇▇▇▇▇▇▇▇ agrees
not to solicit any of the sponsors in any way for a minimum
period of two years from the last date of SC&T Racing/▇▇▇▇▇▇▇▇
association. Should ▇▇▇▇▇▇▇▇ wish to add sponsorship to the
race car, or make any changes in the design and/or decoration,
it may be done only with SC&T Racing's express written
permission, and proceeds of such additional sponsorship shall
be split between SC&T Racing and ▇▇▇▇▇▇▇▇ as agreed. The
mechanics and other team participants will be required to wear
any and all sponsor names and clothing that may be required by
SC&T Racing and to have photographs utilized in any and all
advertising for SC&T Racing and its affiliates. ▇▇▇▇▇▇▇▇ will
provide twelve (12) uniforms and four (4) driver suits less
jackets and caps that will be provided by SC&T Racing. SC&T
Racing may procure more for promotional purposes at their
desire and cost. ▇▇▇▇▇▇▇▇ will not seek out or allow any
sponsor or provider of products or services that is deemed to
be in competition with SC&T Racing. SC&T Racing shall have the
right, at no expense and on a royalty-free basis, to use the
names and likenesses of ▇▇▇▇▇▇▇▇ in endorsements, commercial
advertising and promotions that shall include all forms of
media.
▇▇▇▇▇▇▇▇ will make every effort to have the driver attend
autograph and photo sessions and selected SC&T Racing events.
Any and all direct expenses and per diem to attend the special
events for SC&T Racing are the responsibility of SC&T Racing.
▇▇▇▇▇▇▇▇ will paint the tractor/trailer in the appropriate
colors and design of SC&T Racing. A show car and smaller
trailer also will be provided in the color and design of SC&T
Racing for use by SC&T Racing during the race season and in
the off season, which car will also be used as the back up
racing car.
▇▇▇▇▇▇▇▇ shall have the uniforms, tractor/trailer and show car
and trailer finished for participation in the planned launch
scheduled for Las Vegas, Nevada the first week of January,
1997. The above costs are included in the 1997 racing budget
with the exception of room cost for the event.
5) CONFIDENTIALITY
---------------
All the terms of this contract shall be kept confidential by
both parties, their agents, employees, and principals, both
during and after the term of this contract, except that SC&T
Racing may copy its sponsor(s) if so required, and further
that SC&T Racing may disclose whatever its' attorneys deem
necessary to comply with all laws, including securities laws
disclosures.
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6) HOLD HARMLESS AGREEMENT
-----------------------
▇▇▇▇▇▇▇▇ shall indemnify and hold harmless SC&T Racing, its
officers, directors, agents and employees, from all claims,
actions, suits, judgments, costs and fees, including counsel
fees, which arise from the acts and omissions of ▇▇▇▇▇▇▇▇, its
agents, employees, or third parties under its control. The
indemnity provisions of this Agreement shall survive the
termination of this Agreement. ▇▇▇▇▇▇▇▇ shall furnish SC&T
Racing with releases signed by ▇▇▇▇▇▇▇▇ and all its personnel
connected with its performance of this Agreement in a form
acceptable to SC&T Racing. ▇▇▇▇▇▇▇▇ compliance with the
foregoing obligation shall be a condition precedent to the
enforcement of SC&T Racing's obligations hereunder.
7) RIGHT OF FIRST REFUSAL
----------------------
SC&T Racing has first right of refusal with ▇▇▇▇▇▇▇▇ and the
Driver for the 1998 season.
8) ASSIGNMENT/ENTIRE AGREEMENT
---------------------------
This Agreement may be assigned by SC&T Racing upon written
notification to ▇▇▇▇▇▇▇▇ to do so. ▇▇▇▇▇▇▇▇ may not assign or
transfer all or any rights under this Agreement without the
express written consent of SC&T Racing. This Agreement
contains the entire agreement between the parties and any
agreement hereafter to change, modify, discharge or affect the
terms of the Agreement in whole or in part, shall be made in
writing and signed by both parties. This Agreement shall be
construed and governed by the laws of the State of Arizona.
Litigation arising out of this Agreement, shall be conducted
only in the County of Maricopa, State of Arizona.
9) RACE DRIVER
-----------
▇▇▇▇▇▇▇▇ agrees to provide a race driver and a backup
("Driver") who is or will be under exclusive written contract
with ▇▇▇▇▇▇▇▇ for this racing season, and a copy of such
contract shall be furnished to SC&T Racing.
10) SPECIAL RIGHT OF TERMINATION BY SPONSOR
---------------------------------------
▇▇▇▇▇▇▇▇ agrees that SC&T Racing shall have the right to
terminate this Agreement, subject to the following terms and
conditions:
A. In the event that ▇▇▇▇▇▇▇▇ materially breaches this
Agreement, or materially defaults in the performance of any
obligation hereunder and does not remedy such
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breach or default within ten (10) days following written
notice from SC&T Racing specifying such breach or default,
SC&T Racing shall have the right to terminate this Agreement
forthwith; or
B. In the event that ▇▇▇▇▇▇▇▇ or its agents or the Driver
commit any act or are involved in any situation tending to
bring ▇▇▇▇▇▇▇▇ and/or SC&T Racing into public disrespect,
scandal, or ridicule, tending to shock or offend the
community, tending to derogate from the public image of SC&T
Racing or ▇▇▇▇▇▇▇▇, or tending to reflect unfavorably upon
SC&T Racing or ▇▇▇▇▇▇▇▇ or any of their products or services,
then SC&T Racing shall have the right to terminate this
Agreement immediately upon notice given to ▇▇▇▇▇▇▇▇.
C. In the event of the following: (i) the making by ▇▇▇▇▇▇▇▇
of an assignment for the benefit of creditors; (ii) the
appointment of a trustee, receiver or similar officer of any
court for ▇▇▇▇▇▇▇▇; or (iii) the institution of bankruptcy,
composition, reorganization, insolvency or liquidation
proceedings by or against ▇▇▇▇▇▇▇▇ without such proceedings
being dismissed within thirty (30) days from the date of the
institution thereof, SC&T Racing shall have the right to
terminate this Agreement.
11) RELEASE
-------
▇▇▇▇▇▇▇▇, for itself, its successors and assigns, jointly and
severally releases and forever discharges SC&T Racing, its
successors and assigns, its officers, shareholders, employees
and agents from any and every claim, demand, loss, damage
action or right of action, of whatever kind or nature, either
in law or in equity, arising from or by reason of any bodily
injury or personal injury known or unknown, death or property
damage that may occur as a result of participation in or
preparation for racing events, or any other activities in
connection therewith, whether the result of negligence or
otherwise. ▇▇▇▇▇▇▇▇ further agrees to obtain and keep on file,
releases from any and all members of the crew, whether
salaried, casual or volunteer workers. Neither ▇▇▇▇▇▇▇▇, nor
any agent nor employee of ▇▇▇▇▇▇▇▇, shall make any claim
against SC&T Racing with respect to any remuneration in the
nature of salary or otherwise or with respect to any cost,
damage, loss or expense incurred for any reason, including but
not limited to damage, injury or death which may be suffered
by ▇▇▇▇▇▇▇▇, its agents, employees, third parties or any
property of ▇▇▇▇▇▇▇▇.
12) THE NATURE OF THE RELATIONSHIP
------------------------------
The parties expressly understand and agree that ▇▇▇▇▇▇▇▇ is
acting as an independent contractor, unrelated to the SC&T
Racing. ▇▇▇▇▇▇▇▇ shall not have authority or right to bind
SC&T Racing contractually or otherwise. Nothing in this
Agreement is intended to create a relationship, express or
implied, of employer-employee or
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partnership between SC&T Racing and ▇▇▇▇▇▇▇▇. Each party shall
be fully liable for Worker's Compensation premiums and
liability, Federal, State and local withholding taxes or
charges with respect to its respective employees and each
agrees to save the other harmless from any claims brought
against the other in respect thereto. For all purposes and
specifically with reference to the subject matter of the
Agreement, the parties shall be and act as independent
contractors, and under no circumstances shall this Agreement
be construed as one of agency, partnership, joint venture or
employment between the parties. Each party acknowledges and
agrees that it neither has nor will give the appearance or
impression of having any legal authority to bind or commit the
other party in any way.
13) TRADEMARKS
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The words "Platinum Sound," any and all SC&T Racing's brand
logos, labels, designs, product identification, decals and
artwork (referred to herein collectively as "SC&T Trademarks")
shall remain the property of SC&T Racing. SC&T Racing grants
to ▇▇▇▇▇▇▇▇ the right to use the above in accordance with the
provisions hereof, provided that such right is non-exclusive,
nonassignable, and nontransferable. Any and all rights under
trademark or copyright law or other property rights arising
from such use thereof shall inure to the sole benefit of SC&T
Racing. All pictures, prints, motion pictures, audio or visual
tapes, artists' renderings, plans, ideas, concepts and other
things which are made or prepared by or for SC&T Racing or its
agents in connection with its sponsorship of the Car shall be
and remain the exclusive property of SC&T Racing. SC&T Racing
shall have the right to obtain, register and otherwise perfect
sole and exclusive ownership of any of the aforementioned
items by means of copyright, trademark, service ▇▇▇▇ or other
proprietary means anywhere and at any time, and shall have the
right to use any such items in perpetuity in any manner, when
and where it may designate, without any claim on the part of
▇▇▇▇▇▇▇▇ or any third party to any right of ownership or right
to additional compensation.
14) INSURANCE
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▇▇▇▇▇▇▇▇ or qualified subcontractors shall provide SC&T Racing
with access to the standard liability insurance policies
provided by Event sponsors, having aggregate coverage limits
of no less than Ten Million Dollars ($10,000,000.00). These
policies will be extended to provide for SC&T Racing as an
named additional insured or other evidence reasonably
satisfactory to SC&T Racing that it is properly covered by
insurance. ▇▇▇▇▇▇▇▇ will provide SC&T Racing proof of
insurance by delivering copies of the declaration pages of all
applicable policies. Any change or cancellation in that policy
will require ten (10) days notice to SC&T Racing by ▇▇▇▇▇▇▇▇.
▇▇▇▇▇▇▇▇ shall also provide and maintain liability
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insurance on the tractor-trailer of not less than One Million
Dollars ($1,000,000.00) and provide evidence thereof to SC&T
Racing.
15) EXPENSES
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Except as otherwise expressly provided herein, each party will
be responsible for any expenses incurred by such party in
connection herewith.
16) TERMS
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This Agreement commences October 1, 1996 and runs through the
racing season to September 30, 1997; however, certain
marketing or promotional events may take place through
December 1997 and ▇▇▇▇▇▇▇▇ will participate as agreed upon
between the parties.
Executed on this 1st day of October, 1996.
▇▇▇▇▇▇▇▇ MOTORSPORTS, INC. SC&T RACING INTERNATIONAL, INC.
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, President ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
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