LOUISVILLE, Ky. — We all hear $33 million dollar buyout and say, “no way they can afford that!”
The reality is these schools never pay for it all up front.
We only have to look to the University of Louisville which has done multiple buyouts for former coaches.
Ex-basketball coach Chris Mack is currently receiving monthly payments of $133,333.33 of his $4.8 million buyout until January 2025.
The university paid fired football coach Bobby Petrino $1.17 million in 12 quarterly payments until 2021.
Many of us know that the University of Kentucky is in a better financial position that UofL at the moment.
If Coach John Calipari were replaced at UK, how would a buyout work?
Calipari’s contract is 75% of the current total worth of the contract.
USA Today reports the buyout is $34,968,749 – higher than previously reported by others. From experience covering these separations, I can tell you, take the higher figure.
Calipari's contract calls for the buyout to paid monthly over the life of the deal which ends in 2029. That's five years from now, or 60 months. UK would have to pay him roughly $582,812.48 a month until 2029.
Unlike some deals which require a total payout, his buyout changes if he gets a new job. Calipari’s new salary would then reduce the UK buyout.
The language in his current contract reads, "Upon the coach's acceptance of new employment, the University's obligation to pay the full amount of liquidated damages, shall be reduced by the amount of the minimum guaranteed annual salary of the coach's new position or the reasonable market value of the position, whichever is greater."
Whatever you think of Calipari, he’s marketable and could easily get a new job.
Why did UK cut this deal?
Let’s remember the time when athletic director Mitch Barnhart and university president Eli Capiluto signed the deal.
It was 2019 and Calipari had just led the Wildcats to the Elite 8. Reports had surfaced that Calipari talked with UCLA and the NBA.
Kentucky moved up to lock their Hall of Fame coach with a deal that includes lifetime incentives and a salary.
A buyout would end that, depending on how friendly a separation is (if it even happens).
One other buyout note about former UofL coach Rick Pitino. People mistakenly believed he received money from UofL, but he did not.
In 2019, Pitino reached a settlement with UofL that changed the reason for his departure in his personnel file. Instead of being “fired”, the university erased that and called it a “resignation,” and this was two years after the original firing.
As part of the deal, Pitino got no money.
The university dodged a buyout that certainly would have been a whopper.
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