Action Performance and Chip Ganassi, Four-Time CART World Champion and NASCAR Team Owner, in Exclusive 10-Year Licensing Agreement
PHOENIX--Oct. 15, 2001--Action Performance Cos. Inc. (company) , the leader in the design, marketing, promotion and distribution of licensed motorsports merchandise, today announced a 10-year licensing agreement with Chip Ganassi, winner of four CART world championships and owner of two NASCAR racing teams, under which Action has secured exclusive rights to design, manufacture and distribute Chip Ganassi and Ganassi's racing teams' die cast, apparel and novelty items.
Terms of the licensing agreement, which runs through 2011, also include personal appearances by Ganassi and team drivers for TV, luncheon and distributor meetings, trackside and other promotional purposes.
Also under the agreement, the company will represent Ganassi and Ganassi team drivers as their sole agent in negotiating licensing and other marketing and promotional agreements relating to products not in direct competition with Action's licenses. As their agent, Action will receive a portion of the fees and royalties paid to Ganassi and team drivers.
Ganassi commented: "I am very happy to be part of the Action organization and take great pride in being associated with hard- working people who know their business. Action produces the most sought-after die cast collectibles, apparel and racing memorabilia and sets the standard for motorsports collectors and fans. We look forward to this long-term relationship."
Fred Wagenhals, Action Performance chairman, president and chief executive officer, also commented: "We are very pleased with this opportunity to represent Chip and his racing teams. Chip is the owner of highly successful racing teams, so we consider this a significant addition to our portfolio of exclusive licenses with the top NASCAR drivers and teams.
"As Ganassi's agent, this represents a natural extension of our core business and will allow us to capitalize on our extensive capabilities," Wagenhals continued. "Being involved in licensed motorsports merchandising for over 10 years, we have developed a tremendous base of knowledge and expertise in the key aspects of creating and executing successful programs and promotions. Our strategy is to leverage these capabilities to assure that Chip Ganassi Racing's commercial opportunities are maximized through sales of licensed merchandise designed and developed by Action and other vendors."
Dave Martin, Action Performance chief financial officer, added: "We expect this agreement to generate incremental revenues due to the addition of new products associated with top drivers in NASCAR racing. We also expect further margin improvement, since our existing creative, production and distribution resources are expected to be utilized with little, if any, added expenditures."
About Action Performance
Action Performance Cos. Inc. is the leader in the design, marketing, promotion and distribution of licensed motorsports merchandise. Its products include a broad range of motorsports-related die-cast car replica collectibles, apparel, souvenirs and other memorabilia. The company markets and distributes products through a variety of channels, including trackside at racing events, a worldwide network of wholesale distributors and specialty dealers, QVC, the Racing Collectables Club of America (RCCA), goracing.com, and mass retail department stores and chains.
This news release contains forward-looking statements regarding agreement terms, business expansion, sales opportunities, revenues, new products, margins, resources and expenses. The company's actual activities and results could differ materially from those set forth in the forward-looking statements. Factors that might cause such differences include, among others, the ability of all parties to execute the agreement, competitive pressures, acceptance of the company's products and services in the marketplace, the success of new marketing programs, the company's ability to successfully execute its restructuring, the occurrence and related effects of terrorist or other hostilities, and other risks discussed in the company's Form 10-K dated Sept. 30, 2000, on file with the U.S. Securities and Exchange Commission.