Smith getting $600,000 later

Foundation’s portion of contract deferred before bankruptcy filing

Arkansas Coach John L. Smith John L. Smith is 4-7 in first year at Arkansas and 136-93 in his 19th year overall.

— John L. Smith is under contract to be paid $850,000 to serve as Arkansas’ football coach for 10 months, but $600,000 of his compensation is being deferred for several months.

Smith will be paid two payments of $300,000 - the first Dec. 31, 2012, and the second Feb. 23, 2013 - by the Razorback Foundation, according a personal services and guaranty agreement he signed Aug. 30, 2012. A copy of the agreement was obtained by the Arkansas Democrat-Gazette Monday from the UA through a Freedom of Information request.

The agreement was signed a week before Smith filed for Chapter 7 bankruptcy, the timing of which raises questions of whether the deferred payments were arranged to keep him from having to turn over the bulk of his Arkansas coaching income to creditors.

Smith declined to comment on the deferred payments when asked about the subject Monday during his weekly news conference. The Razorbacks play Kentucky on Saturday.

“I will comment on football,” Smith said. “I would rather not comment on any of that [regarding bankruptcy issues]. That’s not in my hands. I am preparing for Kentucky.”

Smith had an amended filing in U.S. Bankruptcy Court in Fayetteville last Wednesday for $40.6 million in liabilities and $1.3 million in assets.

In a previous filing, he reported $25.7 million in liabilities and $1.2 million in assets.

Smith said he wants to focus on football, but he has a meeting Friday - the day before the Kentucky game at Reynolds Razorback Stadium - with creditors in U.S. Bankruptcy Court in Fayetteville.

Smith has said repeatedly his financial situation is not a distraction for the Razorbacks this season.

Arkansas Chancellor David Gearhart and Athletic Director Jeff Long were not available Monday to comment on Smith’s deferred payment arrangement, but the UA contract states the Razorback Foundation will prepare and enter separate agreements with Smith and will discuss the best way to structure payments with Smith and his financial advisers.

“It is not unusual for the university to work in coordination with a coach and his representatives on the allocation of compensation,” said Kevin Trainor, who is UA associate athletic director for public relations.

Trainor said Smith also has not yet fulfilled all of his obligations in the personal services element of his agreement with the Razorback Foundation, which include weekly television and radio shows.

“I think the university has been forthright in how much he’s going to get paid, and his employment agreement was laid out, how the $250,000 would come from the university and that there would be a Razorback Foundation agreement,” Trainor said.

“It’s been straightforward throughout the negotiations to the point where it said we would work with the coach and the his financial advisors.”

The Associated Press first reported Smith’s financial difficulty in July, when Smith talked about his involvement in several real estate deals in Louisville, Ky. - where Smith coached from 1998-2002 - several years ago, which went bad when the housing market took a downward turn.

At that time, Smith said his stake was in the “multi-millions.”

Long said at the time Smith was honest about his financial situation before being hired as Arkansas’ coach from Weber State. He had been an Arkansas assistant the previous three years.

Fayetteville attorney Jill Jacoway is representing Smith in his bankruptcy case. Jacoway disclosed in a court filing she has received $20,000 from Smith to handle the bankruptcy.

Sports, Pages 13 on 10/09/2012