ADVERTISING AND PROMOTION AGREEMENT
This Advertising and Promotion Agreement ("Agreement") is entered into
as of June 13, 2000 by and between Pure Steel Custom Cycles, Inc., an
Arizona corporation ("Advertisee'), AZPB Limited Partnership, a
Delaware limited partnership, dba Arizona Diamondbacks ("Team"), and
AZPB REM Limited Partnership, a Delaware limited partnership ("Real
Estate Manager").
RECITALS
A. Team owns and operates a Major League Baseball ("MLB") franchise
known as the Arizona Diamondbacks, which plays its home games at Bank
One Ballpark ("Ballpark").
B. Real Estate Manager, a related entity controlled by Team, controls
signage and other advertising at the Ballpark.
C. Team produces and distributes the Diamondbacks Magazine/Game
Program.
D. Team has developed and utilizes a XXX cat mascot ("Mascot"), which
will appear and perform at most, if not all, home baseball games
played by Team.
E. Advertiser wishes to advertise and promote its motorcycle
manufacturing business at the Ballpark and in connection with Team.
AGREEMENT
1 . Term. The term of this Agreement shall commence July 1, 2000 and
shall terminate December 31, 2003, unless extended or sooner
terminated as provided herein ("Term").
2. Payments.
2.1. Annual Fee. For the rights described in this Agreement,
Advertiser shall pay Team as follows for each year of the Term:
2.1.1. 2000 Season. $7,500, billed in three (3) equal installments of
$2,500 on July 1, August 1 and September 1, 2000.
2.1.2 2001 Season. $15,000, billed in eight (8) equal installments of
$1,875 on the first day of each month beginning on February 1, 2001,
and ending on September 1, 2001.
2.1.3. 2002 Season. $20,000, billed in eight (8) equal installments of
$2,500 on the first day of each month beginning on February 1, 2002,
and ending on September 1, 2002.
2.1.4 2003 Season. $25,000 (net), billed in eight (8) equal
installments of $3,125 on the first day of each month beginni6g
February 1, 2003, and ending on September 1, 2003.
All payment amounts are net of agency commissions, if any. Team will
send an invoice to Advertiser, and payment will be due twenty (20)
days after the date of invoice. Should Advertiser fail to make any
payment within twenty (20) days of the invoice date, interest shall
accrue on all unpaid amounts at the rate of one and one-half percent
(1.5%) per month.
2.2 Trade. In addition to the cash payments set forth in Section 2.1.
Advertiser shall provide the following trade items to Team during the
Term:
2.2.1. 2000 Season. No later than July 13, 2000, Advertiser shall
provide Team with one (1) new customized Arizona Diamondbacks Pure
Steel Motorcycle ("Motorcycle"), with a minimum wholesale value of
$39,000, to be used in conjunction with the Mascot. Upon delivery to
Team, the Motorcycle shall become and shall remain the exclusive
property of Team.
2.2.2. 2002 Season. No later than January , 2002, Advertiser shall
provide Team with one (1) new customized Motorcycle, with a minimum
wholesale value of $39,000, to be used in conjunction with the Mascot.
Upon delivery to Team, the Motorcycle shall become and shall remain
the exclusive property of Team.
2.2.3. 2003 Season. No later than January _, 2003, Advertiser shall
provide Team with one (1) new customized Motorcycle, with a minimum
wholesale value of $39,000, to be used in conjunction with the Mascot.
Upon delivery to Team, the Motorcycle shall become and shall remain
the exclusive property of Team.
2.3 Other Payments. All other payments to be made by Advertiser
hereunder, such as payments under Section 2.4, shall be invoiced in
full by Team and paid by Advertiser as provided in Section 2.1 above.
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2.4 Taxes. Any and all taxes, including sales tax, excise tax,
transaction privilege tax, property tax and other charges levied,
assessed or otherwise imposed by any federal, state or local
governmental authority (other than income taxes of Team or Real Estate
Manager) in connection with any payments hereunder, services provided
hereunder, signage or other advertising provided hereunder shall be
paid by Advertiser.
3. Advertising and Promotion. Each year during the Term, Advertiser
shall receive the following advertising and promotion rights:
3.1 Logo Rights. Advertiser may use the Diamondbacks name and logo
for marketing and promotional uses, subject to prior review of all
materials and written approval by Team. Except as expressly provided
herein, Advertiser has no right to use in any way the corporate or
trade name, trademark(s), service xxxx(s), logo(s) or other
identification of Team (collectively, the '7eam Marks") without Team's
prior written consent. Team grants a limited, non-exclusive license
to Advertiser for use of Team Marks directly related to the activities
described in this Agreement, provided Advertiser first obtains Team's
express written approval for any such use, and provided that all such
uses must be within Team's Home Television Territory only. All Team
Marks are and shall remain the property of Team and any and all rights
therein shall inure to the benefit of and be the exclusive property of
Team. Advertiser's right to use Team Marks cannot be assigned or
transferred and is for the term of this Agreement only. Team marks
may not be used on Advertise s web site or other Interactive Media.
3.2 Print. During the 2000 Season, Advertiser will receive one (1)
full page, four-color advertisement in the remaining three (3) issues
of the Arizona Diamondbacks Magazine/Game Program, beginning with the
August 2000 issue. Each Season during the remainder of the Term,
Advertiser will receive one (1) full page, four-color advertisement in
all nine (9) issues of the Arizona Diamondbacks Magazine/Program,
beginning with the January issue each preceding each Season.
3.3 Mascot. During the 2000 Season, Advertiser will receive exposure
in conjunction with the Mascot.
3.4 Motorcycle Showcase. During the 2001, 2002 and 2003 Seasons, the
Motorcycle will be "Showcased" (ridden around the dirt track of the
Ballpark by the Mascot, along with a Public Address System
Announcement and color matrix presentation) at a minimum of thirty
(30) games during the regular season of play, games to be determined
by Team in conjunction with Advertiser.
3.5 Motorcycle Display. During the 2001, 2002 and 2003 Seasons, the
Motorcycle will be displayed on the Main Plaza of the Ballpark at a
minimum of twenty-five (25) regular season games (including the Pure
Steel Motorcycle Company display one (1) time per month on the
Northeast Plaza of the Ballpark), details and games to be determined
by Team in conjunction with Advertiser.
3.5 Season Tickets. Advertiser will receive two (2) season tickets
for regular season games in the lower level of the Ballpark in a
location determined by Team. Such tickets (or comparable tickets) for
post-season games may be purchased by Advertiser at face value.
Advertiser will have no rights to such tickets after the Term of this
Agreement.
4. Standards. The design, layout, format 'and content of all
advertising hereunder shall be subject to approval by Team. Team
reserves the right to disapprove any advertising which Team determines
fails to conform to quality advertising standards, is in poor taste or
is otherwise objectionable.
5. MLB Subservience Requirements. Notwithstanding any other provision
of this Agreement:
5.1. This Agreement and the rights, exclusivities and protections
granted by Team to Advertiser hereunder shall be subject to the prior
written approval of the Office of the Commissioner of Baseball and
shall in all respects be subordinate to, and shall not prevent the
issuance, entering into, or amendment of, any of the following, each
as may be issued, entered into or amended from time to time
(collectively, the "MLB Documents"): (i) any present or future
agreements or arrangements regarding the telecast, broadcast,
recording (audio or visual), or other transmission or retransmission
(including, but not limited to, transmission via the Internet or any
other medium of interactive communication, now known or hereafter
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developed) of Major League Baseball games, and/or the accounts and
descriptions thereof, entered into with third parties by any of the
Office of the Commissioner of Baseball, the American and National
Leagues of Professional Baseball Clubs, Major League Baseball
Enterprises, Inc., Major League Baseball Properties, Inc., Major
League Baseball Properties Canada Inc., Baseball Television, Inc.,
and/or any of their respective present or future affiliates, assigns
or successors (collectively, the "MLB Entities"), either on its own
behalf or on behalf of the Major League Baseball Clubs and/or other
MLB Entities; (ii) any other present or future agreements or
arrangements entered into with third parties by, or on behalf of, any
of the MLB Entities, including, without limitation, those relating to
ticketing, e-commerce, and/or the exploitation of intellectual
property rights in any medium, including the Internet or any other
medium of interactive communication; (iii) any present or future
agreements or arrangements entered into by Team with the other Major
League Baseball Clu,6s and/or one or more of the MLB Entities
(including, without limitation, the Major League Constitution and each
agency agreement and operating guidelines among the Major League
Baseball Clubs and an MLB Entity); and (iv) the applicable rules,
regulations, policies, bulletins or directives issued or adopted
either by the Commissioner or otherwise pursuant to the Major League
Constitution or any such agency agreement. Team and Advertiser shall
each comply with all applicable terms, conditions and requirements
contained in the MLB Documents with respect to the subject matter of
this Agreement.
5.2. The territory within which Advertiser is granted rights hereunder
cannot extend beyond the Home Television Territory of Team, as
established and amended from time to time pursuant to the MLB
Documents. Nothing herein shall be construed as conferring on
advertiser rights in areas outside of Team 's Home Television
Territory.
5.3. Team shall have the right, at no cost or liability to it or any
other club or MLB Entity, to terminate this Agreement at any time
Advertiser breaches its obligations under Section 5.1 or 5.2 above.
The right to terminate shall be exercisable by delivering written
notice to Advertiser within 30 days after Team obtains actual
knowledge that such breach or retransmission has occurred and the
effective date of such termination shall be no more than 30 days after
the date such notice is given, as specified by Team in such notice.
5.4. In addition, Team shall have the right to terminate immediately
any right or obligation in this Agreement involving "Interactive
Media," upon thirty (30) days' written notice, at no cost or liability
to Team, any other club, or any MLB Entity. For purposes of this
provision, interactive Media" shall mean (i) the Internet or any other
on-line system or computer network; (ii) any interactive wireless
service, including any interactive microwave or cellular service;
(iii) any interactive satellite service; (iv) any interactive
broadcast television, broadcast radio or cable television service; and
(v) any other medium of interactive communication now known or
hereafter devised.
5.5. Any rights granted or obligations undertaken by Team herein
relating to the advertising or promotion of any on-line system,
computer network or interactive media-related services or other on-
line specific goods, services or brands shall expire no later than
October 31, 2000.
6. Indemnification.
6.1. Advertiser. Advertiser at its own expense shall defend,
indemnify and hold Team, Real Estate Manager and Premier Sports
Marketing (Team's advertising consultant), and their respective
successors, assigns, officers, directors, employees and agents
harmless from all claims, demands, suits, actions, proceedings,
losses, fines, expenses, costs, and damages of every kind and
description,' including reasonable attorneys' fees and litigation
expenses, which may be brought or made against or incurred by Team,
Real Estate Manager or Premier Sports Marketing, arising out of: (i)
the use of any trademark, copyright or other intellectual property
right arising out of, or connected with any advertising copy or
signage provided by Advertiser, or (ii) the accuracy, character, form
and subject matter of any advertising copy or signage provided by
Advertiser hereunder. Team and Real Estate Manager acknowledge and
agree that all advertising material submitted by Advertiser is the
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property of Advertiser and shall not be altered or edited in any way
without the express written consent of advertiser. This indemnity
shall have no force or effect if the advertising copy or signage is
altered or edited by any party not authorized by Advertiser.
6.2. Mutual. The parties shall each indemnify, defend and save
harmless the others from any claims, actions, damages, losses or
expenses made against or suffered by the others because of or based
upon the indemnifying party's (or its employees' or agents')
misrepresentations, negligence, unlawful act or omission, or failure
to perform any obligation under this Agreement.
7. Default and Remedies.
7.1. Default. If (i) any party fails to pay any fees or other sums
when due under this Agreement, (ii) any party fails to comply with or
perform any of the provisions of this Agreement, or (iii) a petition
is filed by or against any party under any foreign, federal or state
statute (including, without limitation, Title 1 1 of the United States
Code) for the benefit of creditors such as debt adjustment,
liquidation, winding up, dissolution, reorganization or bankruptcy, or
a custodian (as defined in 1 1 U.S.C. section 101), receiver or liquidator
takes charge of any of any party's property, whether by judicial
appointment, agreement or operation of law; then such party shall be
in default of this Agreement. However, if the non-defaulting party is
not precluded by law from issuing notice of the default, the
defaulting party shall have 1 0 days after written notice is given
within which to cure the default.
7.2. Team and Real Estate Manager Remedies. In the event of a default
by Advertiser, if pursuant to Section 6.1 a notice of default is not
required or if notice is given and the default is not cured within the
time provided, then (a) Team and Real Estate Manager shall be excused
from further performance under this Agreement, (b) Team and Real
Estate Manager may treat this Agreement as having been terminated as
of the time of default, (c) without further notice and with or without
terminating this Agreement, Team and Real Estate Manager may remove
Advertiser signage and other advertising and remarket such rights or
otherwise mitigate damages, and (d) Team and Real Estate Manager may
recover from Advertiser all losses and damages they suffer by reason
of a default, including any costs in finding a substitute Advertiser.
7.3. Advertiser Remedies. In the event of a default by Team or Real
Estate Manager, if pursuant to Section 6.1 a notice of default is not
required or if notice is given and the default is not cured within the
time provided, Advertiser may: (i) treat the Agreement as having been
terminated as of the time of default and thus be excused from further
performance under this Agreement; or (ii) continue this Agreement and
recover all damages resulting from the default. In no event shall
Team or Real Estate Manager be liable or responsible for any lost
income, profits or consequential damages of Advertiser or any person
or entity.
8. Force Maieure. If a material number of Diamondbacks games cannot
be played because of fire, the elements, mob, riot, national or local
emergency, strikes, lockouts, calamity, epidemic, war, or for any
other reason outside the control of Team, at its option Team may
provide additional advertising, sponsorship or promotional rights,
provide Advertiser with a refund or rebate for missed games, or extend
the Term of this Agreement to compensate Advertiser for lost rights.
9. Governing Law and Arbitration. This Agreement shall be governed by
Arizona law. All disputes arising under this Agreement shall be
resolved by arbitration conducted in accordance with the Commercial
Rules of the American Arbitration Association before a single
arbitrator, such arbitration to take place in Phoenix, Arizona.
However, if a party wishes to seek interim relief, whether affirmative
or prohibitive, in the form of a temporary restraining order or a
preliminary injunction or other interim equitable relief concerning
the dispute, including without limitation declaratory relief,
provisional remedies, special action relief or stay Proceedings in
connection with special action relief, either before beginning or at
any point in the arbitration proceedings concerning such dispute, such
party may initiate the appropriate litigation to obtain such relief,
which shall be subject to and controlled by the ultimate decision in
the arbitration proceedings. The prevailing party in any arbitration
or other legal action shall be entitled to costs and reasonable
attorneys' fees.
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10. Independent Contractors. The parties are independent contractors
and shall be solely responsible for the conduct of their respective
employees and agents in connection with the performance of their
obligations under this Agreement.
11. Assignment. No party may assign or 'transfer any of its rights or
obligations under this Agreement without the prior written consent of
all parties, provided that Team may assign this Agreement to a
transferee of Team's MLB franchise. In addition, Team may make a
collateral assignment of its rights under this Agreement to a
financial institution ("Lender'), and Advertiser consents to the grant
by Team to Lender of a first priority security interest in the
interest of Team under this Agreement. Upon foreclosure by Lender on
Team's interest in this Agreement (and related rights and interest) to
Lender (or other party designated by Lender), provided the transferee
succeeds to the ownership of Team's MLB franchise for Phoenix, Arizona
(as approved by MLB), and provided further that the transferee
succeeds to and performs Team's obligations to play home games at Bank
One Ballpark and honor Team's obligations under this Agreement.
12. No Waiver. No delay of or omission in the exercise o f any right,
power or remedy accruing to any party under this Agreement shall
impair any such right, power or remedy, nor shall it be construed as a
waiver of any future exercise of any right, power or remedy.
13. Severability. In case any provision of this Agreement shall be
invalid, illegal or unenforceable, such provision shall be severed
from this Agreement. The validity, legality and enforceability of the
remaining provisions of this Agreement shall not in any way be
affected or impaired thereby.
14. Sophistication of Parties. Each party to this Agreement
represents that it is a sophisticated commercial party capable of
understanding all of the terms of this Agreement, that it has had an
opportunity to review this Agreement with its counsel, and that it
enters this Agreement with full knowledge of the terms of the
Agreement.
15. Notice. Any notices, consents or approval required or permitted
under this Agreement shall be properly given if in writing, whether
personally delivered, delivered by facsimile machine or forwarded by
mail, postage prepaid, addressed to the following addresses (or such
other addresses as may from time to time be designated in writing by
each party): To Team: Arizona Diamondbacks 000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000 Attn: Xxxxx Xxxxxxxx
To Real Estate Manager: AZPB REM Limited Partnership 000 Xxxx
Xxxxxxxxx Xxxxx Xxxxx Xxxxxxx, Xxxxxxx 00000 Attn: Xxxxx Xxxxxxxx
With copies to: Xxxxxxxxx & Xxxxxxx, P.C. 0000 Xxxx Xxxxxxxxx Xxxx
Xxxxxxx, Xxxxxxx 00000-0000 Attn: Xxxx X. Xxxxx, XX. AZPB Limited
Partnership 000 Xxxx Xxxxxxxxx Xxxxxx Xxxxx Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxx X. X'Xxxxxx, III
To Advertiser: Pure Steel Custom Cycles, Inc. 0000 Xxxxx Xxxxxx Xxxxx
00 Xxxxxxx, Xxxxxxx 00000 Attn: Xxxxx Xxxx & Oscar Coca
16. Integration Clause. This Agreement is the final, complete and
exclusive statement and expression of the agreement among the parties
hereto with relation to the subject matter of this Agreement, it being
understood that there are no oral representations, understandings or
agreements covering the same subject matter as this Agreement. This
Agreement supersedes, and cannot be varied, contradicted or
supplemented by evidence of any prior or contemporaneous discussions,
correspondence, or oral or written agreement of any kind.
(SIGNATURES APPEAR ON THE FOLLOWING PAGE)
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Team: AZPB Limited Partnership, a
Delaware limited partnership
By
Its
Real Estate Manager: AZPB REM Limited Partnership, a
Delaware limited partnership
By Xxxxxxx X. Xxxxx
Its President
Advertiser: Pure Steel Custom Cycles, Inc., an Arizona corporation,
By Oscar Coca
Its
