While pocket knives and parkas flew off the shelves at Sports Authority’s going out of business sales, and foosball table, desk chairs, and iMacs flew out of its former headquarters building through Craigslist ads, one of the bankrupt company’s assets didn’t sell: the naming contract for the field where the Denver Broncos play, which the chain had bought in 2011. It’s now official: the team and the stadium district have agreed to terms and effectively bought back the rights from the defunct retailer.
Potential sponsors may have stayed away because of questions over whether the team, the stadium district, and the NFL would have accepted the auction winner as the legitimate owner of the naming rights.
Instead of Sports Authority paying any portion of its two missed payments, the agreement is that the company’s estate will pay the Broncos $50,000, the Broncos in turn will make the next payment of $3,601,890 on behalf of Sports Authority.
This also settles a dispute between the team itself and the retailer over sponsorship of the team and its games, not just of the stadium: Sports Authority had a separate agreement to put coupons on game tickets, and advertisements in the stadium and even the team’s website. The team argued that Sports Authority should keep paying, since the ads got its name out there during the liquidation sale.
The bankruptcy court judge approved this plan yesterday [PDF], and now the Broncos and their stadium can go out and seek a new sponsor. For now, the Sports Authority name remains on the stadium and in news reports about the team.
by Laura Northrup via Consumerist
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