$8 Million NIL deal....for a class of 2023 prospect

[Francisco 2.0 32,395]

 

https://theathletic.com/3178558/2022/03/11/five-star-recruit-in-class-of-2023-signs-agreement-with-collective-that-could-pay-him-more-than-8-million/

 

EDIT:  In the Athletic comments section, speculation it's either Nelson (to USC) or the other Cali QB (to Tennessee).  The attorney featured in the article is from California.

 

Quote

On Friday, a five-star recruit in the Class of 2023 signed an agreement with a school’s NIL collective that could pay him more than $8 million by the end of his junior year of college, The Athletic has learned. He’ll be paid $350,000 almost immediately, followed by monthly payouts escalating to more than $2 million per year once he begins his college career, in exchange for making public appearances and taking part in social media promotions and other NIL activities “on behalf of (the collective) or a third party.”

 

 

Quote

While there’s no centralized database to reference other contracts, two NIL experts believe it’s the largest individual NIL deal signed by a non-professional athlete.

 

 

Quote

Blake Lawrence, the founder of the NIL marketing platform Opendorse, said a deal that high seems like an outlier but added, “Whatever casual sports fans or coaches think student-athletes are earning from collectives, they’re (undershooting) by 10X. While $2 million (a year) is wild, $200,000 isn’t, but most people are thinking they’re getting $20,000.”

 

Spoiler

Lawyer Mike Caspino, who drafted the contract, allowed The Athletic to review and verify the contract in exchange for keeping the player and collectives’ identities anonymous. It provides a window into how donor-driven third parties tied to specific schools operate.

As per NCAA rules, the contract explicitly states, “nothing in this Agreement constitutes any form of inducement for (the athlete) to enroll at any school and/or join any athletic team.” There is no mention of any specific university, only that he be “enrolled at an NCAA member institution and a member of the football team at such institution,” ostensibly to avoid violating the NCAA’s pay-for-play rule. The only specific circumstances by which the collective could terminate the contract early is if the player violates a confidentiality clause or a clause about conducting himself with “the utmost character and integrity.”

“There’s an element of trust there,” Caspino said in regards to a collective offering that much money with no written assurance the athlete will sign with the donors’ school come December.

But in exchange for receiving his lucrative advances, the player hands over to the collective exclusive rights to use of his NIL, which would then negotiate outside opportunities on his behalf. In theory, that could dissuade him from entering the transfer portal, as he would not be able to make paid appearances promoting his next school.

Caspino, who says he has worked on deals like this with about 30 high school players, said the original terms were far more one-sided toward the collective. He decried some of the tactics those groups and NIL agents are using to maintain control over the athlete.

In one draft version of another deal The Athletic reviewed, the collective agreed to pay an athlete $1.5 million across two years but could “from time to time” ask for repayment of that money, plus a 10 percent commission and expenses — even if the agreement were to be terminated.

“Man, that is terrifying, quite frankly,” said Malik S. Jackson, a Florida-based attorney who works in the NIL space. “That was a terrible provision, and if that’s put in, that’s a sign the collective is not athlete-centric. It can’t be.”

Jackson compared it to one-sided contracts in the music industry commonly referred to as “360 deals,” where record companies claim a share of an artist’s future earnings.

Caspino, however, was able to negotiate that language out of his client’s particular contract. It’s unclear if it has been included in others. Jackson said he hasn’t seen language like that in any contracts he has dealt with on behalf of companies but has not dealt with collectives often.

Caspino said he has also seen language in which the collective retains a player’s exclusive NIL rights for the duration of the contract even if it’s terminated early.

“There’s always some hook in there, that if they’re paying money, somehow, someway, that kid is going to have a deep financial inducement to stay at that university,” he said. “I’ll never have one of my clients sign that.”

His concern is that most high school players are signing deals like these without running them by an attorney first.

“The word ‘exclusive’ is the most expensive word for any athlete in any marketing agreement,” Lawrence said. “Student-athletes should own and maintain their NIL rights.”

But for some athletes and families, it may be too tempting to sign what’s offered, no matter the terms.

The fact that a high school junior has been promised more than $8 million to entice him toward a specific school — even if not put in writing — no doubt will horrify college administrators, many of them already frustrated by the NCAA’s inability to police NIL.

Last month, the NCAA Board of Directors asked the Division I Council to prepare a report by April assessing the impact NIL is having in recruiting, among other issues.

“We are concerned that some activity in the name, image and likeness space may not only be violating NCAA recruiting rules, particularly those prohibiting booster involvement, but also may be impacting the student-athlete experience negatively in some ways,” said board chair Jere Morehead, the president at the University of Georgia.

But many in the profession believe the NCAA wants no part in trying to enactrestrictions on athletes’ NIL compensation due to last summer’s Supreme Court decision in the Alston antitrust case. As long as all parties are smart enough to not put anything recruiting-related in writing and the athlete can prove he or she is providing legitimate NIL services, there may be no limit to the rapidly soaring dollar figures permeating recruiting.

“Nobody knows what these kids are actually worth because there’s not enough data,” Lawrence said. “Imagine you’re selling your home, Zillow never existed and someone comes up and says they’ll give you $50,000 for your house. You have no idea whether that’s good or bad, but it sounds like a lot, so you take it. But then you go and search Zillow and find out it was actually worth $500,000.”

The top high school prospects are quickly learning they’re worth far more than that.

 

Edited March 12, 2022 by Francisco 2.0

[TwiceHorn 31,505]

That seems to be illegal or unlawful under all of the NIL rules/statutes that I have seen.

The one loophole being that I think prospective student athletes may be signed to NIL deals that are not contingent upon signing with or playing at a particular institution.

So this might be a collective not connected to any particular university.  A pure profit play.

And, I think I dislike that idea even more than the university-connected ones.

Edited March 12, 2022 by TwiceHorn

[Brandywine 1,316]

That’s insane! 

[Henry Hill 3,156]

Man, that’s a lot of dough. NIL has a higher arch than I thought.

[pops 7,005]

This all seems fine. Everything is fine. 

[Doc Reeves 6,434]

How the fuck could a college player l generate that much money for a company? Regardless of the specifies you can roughly estimate the kid in question would be getting 15-18% of what they expect to make with his likeness. What the fuck are they selling? 

[pops 7,005]

Just now, Doc Reeves said:

How the fuck could a college player l generate that much money for a company? Regardless of the specifies you can roughly estimate the kid in question would be getting 15-18% of what they expect to make with his likeness. What the fuck are they selling? 

Idiots throwing cash because they don't know better or simply putting it all on black 22 and hoping for a homerun. Or maybe crypto

[tx 3 putt 77,105]

Arch Manning is worth $8mil in name alone. He’ll get double that 

[NeverMarryAStripper 21,907]

From reading the article it sounds like it’s an NIL deal from a particular school, but it can’t be worded that way or it violates the rules.  Theoretically he could sign the deal and play for a different school, but the rights to his name and likeness would still be held by this school’s collective and he couldn’t do any paid appearances for the school he plays for.  This whole NIL deal is crazy and I think it’s going to be the end of real college football.

[Sgt Hulk 13,789]

https://www.totalprosports.com/2022/03/11/report-florida-state-db-becomes-first-college-player-to-hold-out-due-to-lack-of-nil-deal/?fbclid=IwAR3-Zuicmtv2F94Lm321bRdrsC2EG8N__ijKJEFVTLBOY1EJBQ5hkNrrXdE
 

you also have this idiot on the other end of the spectrum.  The sports fucked U

[Coelenterate Fuccboi 13,119]

8 hours ago, NeverMarryAStripper said:

This whole NIL deal is crazy and I think it’s going to be the end of real college football.

I took this stance from the very beginning. Many celebrated the change and I viewed it as the final straw to money ruining college football, at least for my liking. Yeah, yeah, old man yells at clouds… Changes needed to be made but the manner in which this was done will have detrimental impacts on the sport.

 

[bad_teammate 13,218]

Not sure what it changes for those who just watch the games and don't really keep up with gossip/drama.

CFB has never been a sport where the little guy has a decent chance at elite recruits or trophies. BYU in 1984 and I guess Clemson's resurgence. The influence of money has always been a major determinant.

[Francisco 2.0 32,395]

Looking back in the Athletic article comments section this morning; a couple of points were raised:

-is there an injury clause of some kind in the contract for the kid if an injury happens during his senior year, and

-this may lead to kids not playing football their senior year of high school, if they can get the bag early enough.

 

 

 

 

[TwiceHorn 31,505]

11 hours ago, NeverMarryAStripper said:

From reading the article it sounds like it’s an NIL deal from a particular school, but it can’t be worded that way or it violates the rules.  Theoretically he could sign the deal and play for a different school, but the rights to his name and likeness would still be held by this school’s collective and he couldn’t do any paid appearances for the school he plays for.  This whole NIL deal is crazy and I think it’s going to be the end of real college football.

Yeah, that might make some sense, but seems an awful risk for the collective.

[927 E. 41st 1,124]

11 minutes ago, Francisco 2.0 said:

-this may lead to kids not playing football their senior year of high school, if they can get the bag early enough.

Perhaps he could make a "donation" to his High School and "graduate" early.

[TheStoicPaisano 9,922]

Only Lendak is worth that $

[Js1 85,428]

We slipping if we don’t deal Arch $8.1 million for 3 years at Texas

[Coelenterate Fuccboi 13,119]

27 minutes ago, bad_teammate said:

Not sure what it changes for those who just watch the games and don't really keep up with gossip/drama.

CFB has never been a sport where the little guy has a decent chance at elite recruits or trophies. BYU in 1984 and I guess Clemson's resurgence. The influence of money has always been a major determinant.

If you haven’t see the difference in the past 10 years I don’t know what to tell you. You’re just looking at the recruiting aspect. The entitlement, which has already been steadily growing as evidenced by all the opting out immediate transfer, will get out of control.

[Beau Vine 54,258]

1 hour ago, Coelenterate Fuccboi said:

If you haven’t see the difference in the past 10 years I don’t know what to tell you. You’re just looking at the recruiting aspect. The entitlement, which has already been steadily growing as evidenced by all the opting out immediate transfer, will get out of control.

Thanks, Dabo.

[immamac 42,868]

It’s almost like they ain’t come to play school 

[ButtFumble 5,180]

6 hours ago, Sgt Hulk said:

https://www.totalprosports.com/2022/03/11/report-florida-state-db-becomes-first-college-player-to-hold-out-due-to-lack-of-nil-deal/?fbclid=IwAR3-Zuicmtv2F94Lm321bRdrsC2EG8N__ijKJEFVTLBOY1EJBQ5hkNrrXdE
 

you also have this idiot on the other end of the spectrum.  The sports fucked U

someone on this forum in the past scoffed at the idea that these deals would lead to issues in the locker room

you think some OLine player wants to hear anything from his QB about blocking harder or giving more effort to protect him when one is getting a million or more to play and one is getting some Chick Fil A gift cards and maybe a free oil change

[RGBIII 22,840]

It’s Tennessee buying that Nico kid publicly. It’s gross and goes against the spirit and legality of the NIL

[Scooter Monzingo 821]

26 minutes ago, RGBIII said:

It’s Tennessee buying that Nico kid publicly. It’s gross and goes against the spirit and legality of the NIL

Im of the opinion we haven’t seen shit yet. 

[AeroHorn 752]

I am looking forward to an academically focused P5 conference (Pac12?) to go semi-Ivy League and deemphasize football by capping costs such as coaches' salaries and reducing ticket prices. Let SEC become the NIL/bag driven conference. The only way to compete is by paying players through alumni, and this basically makes it a professional league run by shadowy alumni groups. The coaches are like the willing cops/DAs in this alumni-led mafia world. Not a good place for the universities to be in.

 

[Sgt Hulk 13,789]

Highschool football careers will now span 10-11th grade. Skip senior year to work with private trainer. Get the bag. Play 1-2 years of college then nfl.  
 

genius 

[Tex-19 2,872]

What keeps a kid from taking a big upfront payment and then going to a different school anyway? 

I mean obviously a lot of kids will have the honesty to honor their word, but someone’s gonna get burned at some point. 

[ChickenSandwich 9,843]

If he is injured playing high school football, is he covered by an insurance policy?

[bad_teammate 13,218]

4 hours ago, Coelenterate Fuccboi said:

If you haven’t see the difference in the past 10 years I don’t know what to tell you. You’re just looking at the recruiting aspect. The entitlement, which has already been steadily growing as evidenced by all the opting out immediate transfer, will get out of control.

And until that "entitlement" manifests on the field in some way... don't care.

I guess an argument could be made that this will "ruin" HS football due to players sitting out to protect NIL deals, but that's a separate question.

We have amazing CFB players only putting in two years on the field before going to the NFL.

RUINED!!!!

[dec3169 503]

1 hour ago, Tex-19 said:

What keeps a kid from taking a big upfront payment and then going to a different school anyway? 

I mean obviously a lot of kids will have the honesty to honor their word, but someone’s gonna get burned at some point. 

Does Dickerson have a son?

[Francisco 2.0 32,395]

1 hour ago, Tex-19 said:

What keeps a kid from taking a big upfront payment and then going to a different school anyway? 

I mean obviously a lot of kids will have the honesty to honor their word, but someone’s gonna get burned at some point. 

 

The article addresses this.  The player signed a NIL contract with this collective.  If the kid goes elsewhere, he can't accept NIL money at the new school...since his NIL "rights" are owned by the collective.  

Think of it as the Big 12 Grant of Rights.

 

 

Edited March 12, 2022 by Francisco 2.0

[nnm 36,467]

1 hour ago, Tex-19 said:

What keeps a kid from taking a big upfront payment and then going to a different school anyway? 

I mean obviously a lot of kids will have the honesty to honor their word, but someone’s gonna get burned at some point. 

[Pato del Muerto 52,529]

5 minutes ago, Francisco 2.0 said:

 

The article addresses this.  The player signed a NIL contract with this collective.  If the kid goes elsewhere, he can't accept NIL money at the new school...since his NIL "rights" are owned by the collective.  

Think of it as the Big 12 Grant of Rights.

 

 

I guess there’s some level of exclusivity written in?  Because they wouldn’t be the case empirically. You can sign to do commercials for Amy’s ice cream as well as henna Chevrolet. 
 

would be funny for some company attached to one college community to have the rights to an athlete at another university. 

[Tex-19 2,872]

10 minutes ago, Francisco 2.0 said:

 

The article addresses this.  The player signed a NIL contract with this collective.  If the kid goes elsewhere, he can't accept NIL money at the new school...since his NIL "rights" are owned by the collective.  

Think of it as the Big 12 Grant of Rights.

 

 

Wow that’s insane. Can’t believe high school kids are allowed to sell their NIL exclusivity rights to someone like that. Even college kids. What a joke.

With that allowed, how long until the sleazy sharks start coming in buying kids’ rights for chump change to make money off the upside

[Ignatius 4,017]

33 minutes ago, dec3169 said:

Does Dickerson have a son?

More importantly, do we have any deep pocket alums who are willing to part with a cherry, pimp-ass, mint condition gold 6.6 Firebird?

[Yesh 930]

27 minutes ago, Francisco 2.0 said:

 

The article addresses this.  The player signed a NIL contract with this collective.  If the kid goes elsewhere, he can't accept NIL money at the new school...since his NIL "rights" are owned by the collective.  

Think of it as the Big 12 Grant of Rights.

 

 

But wouldn't he still be owed the rest of the 8 million?

 

The way I am reading this is the collective is going to arrange for him to, for example, do commercials for the Knoxville Ford dealership.  The rationale is he will be a popular Tennessee football player, and so the dealership will pay the collective for his services and everyone wins.

 

Let's say he decides to transfer to Hawaii.  The collective would still own his NIL and would still have to pay him, but presumable the Knoxville Ford dealership would no longer be interested in his services.  The collective would have to try to find someone in Hawaii that wants to work with him, and the assumption is the collective doesn't have any existing ties to businesses outside of Knoxville so would be very difficult to find deals.

 

What am I missing?  It says the collective can only terminate for breach of confidentiality or bad behavior.

[Hornius Emeritus 12,472]

4 hours ago, immamac said:

It’s almost like they ain’t come to play school 

Probably hard to play school when you're making 50x what your professor is making.

 

[Deej 76,836]

IRS:

[Blotto 23,559]

3 hours ago, RGBIII said:

It’s Tennessee buying that Nico kid publicly. It’s gross and goes against the spirit and legality of the NIL

Nonsense. its just various degrees of the same shit. Kids are now getting paid to play college football and they are going to get as much money as they possibly can. Does it matter if a schools directly pays them, or a bunch of their alumni band together and pay them under some fucking sham NIL. Not to me. Its basically pro football with no salary cap and free agency. I dont really give a fuck who pays what to whom at this point. 

Edited March 12, 2022 by Blotto

[Gaffords 757]

Aggy will not let this stand.

[Tex-19 2,872]

31 minutes ago, Yesh said:

But wouldn't he still be owed the rest of the 8 million?

 

The way I am reading this is the collective is going to arrange for him to, for example, do commercials for the Knoxville Ford dealership.  The rationale is he will be a popular Tennessee football player, and so the dealership will pay the collective for his services and everyone wins.

 

Let's say he decides to transfer to Hawaii.  The collective would still own his NIL and would still have to pay him, but presumable the Knoxville Ford dealership would no longer be interested in his services.  The collective would have to try to find someone in Hawaii that wants to work with him, and the assumption is the collective doesn't have any existing ties to businesses outside of Knoxville so would be very difficult to find deals.

 

What am I missing?  It says the collective can only terminate for breach of confidentiality or bad behavior.

I think he would still be owed the 8. He just wouldn’t be able to sign any other deals bc the collective owns his rights. In other words, the TN collective ain’t gonna let him do a deal with a dealership for a free car if he goes to Bama.

On the other hand, if he stays at TN, he’ll get the $8mm AND probably some (or all) of the other NIL deals he does. 

[tx 3 putt 77,105]

53 minutes ago, Deej said:

IRS:

 

someone is going to fuck up their taxes and see jail time 

[Francisco 2.0 32,395]

2 minutes ago, tx 3 putt said:

 

someone is going to fuck up their taxes and see jail time 

I can also see kids signing for $8 million, and they and their impressionable parents seeing a fraction, because of some financial advisor.

If it can happen to professional athletes, you know it will happen to 18-20 year olds who are more interested in slaying pussy than paying attention to the details.

[NeverMarryAStripper 21,907]

A lot of these kids are going to get fucked.  In the article it talked about some of these deals trying to include clauses where the kid would be required to pay some of the money back.  Some of these kids are going to sign deals without adequate counseling and just get fuck in the ass.

[Deej 76,836]

@NowThis: "Where do I sign up to get fucked in the ass for $8 million?"

[Pato del Muerto 52,529]

38 minutes ago, Deej said:

@NowThis: "Where do I sign up to get fucked in the ass for $8 million?"

Is it…is it just the one time?

[Zeus 6,098]

21 hours ago, Doc Reeves said:

How the fuck could a college player l generate that much money for a company? Regardless of the specifies you can roughly estimate the kid in question would be getting 15-18% of what they expect to make with his likeness. What the fuck are they selling? 

NIL stands for pay to play bruh it's not about name, image, likeness

[Beau Vine 54,258]

6 hours ago, ButtFumble said:

someone on this forum in the past scoffed at the idea that these deals would lead to issues in the locker room

you think some OLine player wants to hear anything from his QB about blocking harder or giving more effort to protect him when one is getting a million or more to play and one is getting some Chick Fil A gift cards and maybe a free oil change

Seems like this would be a huge problem in the NFL, where the franchise QB's make 20X what the grunts blocking for him make?

[TwiceHorn 31,505]

NIL is a sort of intellectual property akin to a trademark.  It's conceivable and even common that an owner of such IP exclusively licenses it to another entity, much like UT exclusively licenses CLC/Learfield/IMG (whoever they are today) to further license the UT marks (at least on certain categories of goods/services).  They then mostly lose control of who gets licensed by that entity.  Presumably, like UT, the NIL owner gets a shit ton of money without the headache of 100 or 1,000 or 10,000 separate deals.

So, it seems this kid exclusively licensed all his NIL rights to this collective, which may be interested in his attendance at UTenn.  But to make that express would be "unlawful."  It seems the collective feels like they can "sublicense" his NIL wherever he goes and make the deal pay out.  The kid's compensation doesn't seem to be contingent on anything, so he makes out too.  But he has no more NIL to license to anyone else, presumably.

[ButtFumble 5,180]

22 minutes ago, Beau Vine said:

Seems like this would be a huge problem in the NFL, where the franchise QB's make 20X what the grunts blocking for him make?

NFL lineman still make a lot of money not nothing or next to nothing like most college players

you weed out a lot of stupid when you go from 120+ D1-A teams and who knows how many D1-AA teams with 80+ players down to 32 teams with just over half that number of players

NFL players know part of them getting paid is the QB doing well.....much different in college where again many players are getting nothing or next to nothing

even small time NFL players can still get meaningful endorsement deals in addition to NFL pay that limits the amount of stupid for some of them too

[Sbbruin 21,861]

UCLA should just fold the football program.  No way we play in this stratosphere.