Under Armour

[Lobot]

Anddddd. It’s over. We’re out of the deal .

https://www.bizjournals.com/baltimor...ee-buyout.html

[Lobot]

In case you can’t read this. They are paying us 9.75M to exit the deal early. Terminates On July 1. On to Jordan Brand please. This was UA’s call not UC’s

[Lobot]

John Cunningham released a statement on this. I’m looking for a link on it. It appears this is more complicated than it first looked. We get 9.75M but we functionally remain a UA school and put that money back into paying for UA gear from a third party ?!?. In 2024 we exit the deal, one year early.

I’m still trying to figure out if we can negotiate a new contract with someone else and exit early. Seems like we’d be able to.

I’m guessing UA is doing this to get the contract / accounts payable off the books.

[RedDog]

I would think if we negotiate a new deal with someone else we can move on and forfeit a prorated portion of the buyout?

[Lobot]

Maybe? No one seems to know exactly. Justin WIlliams was suggesting that we can negotiate a new contract that would start in 2024 but I'm not sure that's correct either. An Ohio open records request on this agreement would shed some light on it. I'm not the guy for that but I'll bet Justin does it.

[MDW79]

So, do you guys think this is ultimately a good or bad thing?

I'm hoping that our currently success values are brand much higher than what is was 5 years ago. It seems we'd be much more desirable now. And I know nothing about the intricacies of the shoe deals with AAU market, but I have to believe there's some tangible effects of switching from UA to Nike or Addidas.

[RedDog]

Its bad for now and only will be acceptable if we can replace it comparably which will be a real challenge. The chances of it ultimately being good and increasing are slim. Covid is hurting everyone and hitting the big apparel companies very hard as their customer base (high schools, colleges, athletic organizations etc.) are idle or sitting on budgeted funds. As the supply market for bidders on marketing our brand shrinks, so does the value of any agreements.
These guys all have legal issues and large legal costs,settlements and fines to pay. The landscape has changed dramatically since these contracts were signed.
Also I am curious how recruiting is affected as UA and others were notorious for driving their "kids" to schools they sponsored, which is part of their legal woes.

Our brand remains desireable but values for everyone is in decline.

[RedDog]

If I am interpreting things correctly there is a silver lining for us. In our agreement were minimum purchases required, mainly in the non revenue sports, that was a significant number that I think have been negotiated out. So we don't get as much but we don't have to spend as much either. Without our 2 revenue generating sports pulling the financial load, this was going to be a problem.
Somebody correct me if I am wrong.

[swilsonsp4]

Here's a more detailed explanation of the realignment of the UC-UA deal from Justin Williams of theathletic.com ($):

https://theathletic.com/2209307/2020...going-forward/

[Lobot]

UCLA just finalized it's deal with NIke/Jumpman at 7.7M for 6 years. That's down from UA's deal which 18.6M for 15 years. They are in court with UA.

[Lobot]

Little refresher from Sportico this morning.

https://www.sportico.com/leagues/col...al-1234646273/