Force India to lose prize money?

31/07/2018
NEWS STORY

While Renault, McLaren and Williams appear set to disrupt the sale of the Force India sale for their own reasons, in the minefield that are the Team Agreements, there is another element that could cost the Silverstone-based outfit dearly.

The float prospectus talking about the team agreement states that:

"A team's rights and obligations under its Team Agreement terminate if it: (a) ceases to be a constructor, fails to participate in more than three Events in a season or fails to submit a valid entry form for participation in the World Championship, or (b) is insolvent."

Should it be the case that Force India is actually insolvent, in that it cannot currently pay its bills, under the terms of the team agreement it is not allowed to race and also loses its rights to the prize money.

This is why Manor's parent company, Just Racing Services Ltd, and not the one which signed the contracts, previously went into administration.

If this were the case it would mean the prize money, estimated at around $150m, goes to the other nine teams, who could agree to give it to a new team or keep it.

The crucial point being that if Force India is insolvent it is no longer Force India's prize money.

Interestingly, FRP Advisory was the administrator in the Manor case also.

When Manor went into administration the teams had to vote on it using an old car but not whether it kept its prize money.

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Published: 31/07/2018
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