Bobby Ginn says DEI owes Hendrick 80 percent of $1.5 million termination fee
By Bob Pockrass - Associate Editor
Tuesday, March 17, 2009
Former team owner Bobby Ginn contends that he owes only 20 percent of the $1.5 million that Hendrick Motorsports is seeking from Ginn Racing and Dale Earnhardt Inc. because of the termination of Ginn’s engine contract with Hendrick in 2007, according to court documents.
Hendrick Motorsports is suing DEI and Ginn in North Carolina Superior Court over the termination fee resulting from the merger of DEI and Ginn in July 2007.
DEI claims Ginn Racing and Ginn are responsible for a $1.5 million fee that was due Nov. 15, 2008. Ginn states in a recent filing that because a new entity was created that was 80 percent owned by DEI and 20 percent owned by Ginn, that DEI is responsible for 80 percent of the fee due Hendrick.
In filing his response to Hendrick’s and DEI’s claims, Ginn states that it had been agreed that the $1.5 million fee would be paid from operating revenues of the new entity, which was named “DEI/Ginn – Team #01.” If there were not sufficient revenues to pay the fee, then the responsibility for payment would be split 80/20, Ginn contends.
Although not broken down in the suit, 80 percent of $1.5 million would be $1.2 million, with $300,000 left for Ginn to pay.
The $1.5 million fee was the second of two termination fees. The first payment of $1.754 million was paid by Ginn, with a portion of the proceeds received “as part of the merger and acquisition transaction,” according to Ginn’s filing.
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4 responses to "Bobby Ginn says DEI owes Hendrick 80 percent of $1.5 million termination fee". Post a Comment.
Anonymous said:
Mar 17, 2009 at 3:08 PMNot that Rick Hendrick needs the money, but you would think a man as smart as Rick would know not to even conduct a business venture with the likes of "mr" Ginn. Then again, there was that small case of fraud with Honda and Rick. Greed begets Greed.
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» Confirm Abuse Reportfred stephens said:
Mar 17, 2009 at 3:09 PMthat first guy is brillant. He should take Brian France's place. Maybe next year.
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» Confirm Abuse ReportDaniel Turner said:
Mar 18, 2009 at 10:22 AMWhat a mess I feel sorry for the judge.
Report as Abusefrom DEI to Ginn to EGR...who knows who is paying! I think DEI is just using a delay tactic but eventually they will have to cough up the bucks to Mr Hendrick.
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» Confirm Abuse ReportWillie Fast said:
Mar 18, 2009 at 10:56 AMWhat would judge Roy Bean do?
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