Penn State Negotiated a Substantially Lower Buyout With James Franklin

Penn State owed Franklin $48 million after firing him in October. According to multiple reports, Penn State and Franklin agreed to a reduced number.

Former Penn State Nittany Lions coach James Franklin and Athletic Director share a laugh after the team's win over Nevada. | Dan Rainville / USA TODAY NETWORK via Imagn Images

Penn State will pay former coach James Franklin a substantially lower buyout as part of a settlement, according to multiple reports. The agreement officially ends the James Franklin Era at Penn State, as the former Nittany Lions coach begins his new job at Virginia Tech.

As first reported by Jon Sauber of the Centre Daily Times, Penn State and Franklin negotiated a buyout of about $9 million to settle the 10-year contract Franklin had signed in 2021. According to the initial terms of that contract, Penn State would havve owed Franklin $48 million for the remaining six years of the deal in addition to the remainder of his $8 million guaranteed salary for 2025.

According to the contract, obtained by Front Office Sports, Penn State's buyout payments would have been "offset" by any salary he made at his next job in football. Further, according to FOS, the contract stated that Franklin must "diligently search" for another position "appropriate for his skill set" and make "good faith efforts to obtain the maximum reasonable salary" in his next position.

Franklin did that, agreeing to become Virginia Tech's head coach five weeks after being fired Oct. 12. And instead, Penn State and Franklin agreed to the negotiated buyout. Virginia Tech will introduce Franklin during a press conference at 10 a.m. ET Wednesday.

“I’m honored and humbled to join the Hokie family,” Franklin said in a university statement. “My vision is simple: to restore unmatched excellence, to build something that lasts, and to serve this University, the Commonwealth of Virginia and our amazing fan base with honor, integrity, and passion. I look forward to getting to work with our players, our staff, and the entire Virginia Tech community.”

At Virginia Tech, Franklin will succeed Brent Pry, who was his defensive coordinator for eight seasons at Penn State. Pry went 16-24 and was fired after starting his fourth season at 0-3.

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Penn State continues its coaching search

Former Penn State head football coach James Franklin greets fans outside Beaver Stadium before a Nittany Lions game. | Dan Rainville / USA TODAY NETWORK via Imagn Images

Franklin's sharply reduced buyout amounts to about a year of Franklin's salary per the 10-year, $85 million contract he signed at Penn State in 2021. That contract included $8 million guaranteed per year and an annual retention bonus of $500,000.

By agreeing to the settlement, Penn State and Franklin close their financial relationship and clear any future buyout considerations (Franklin had six years left on his contract). In October, Penn State Athletic Director Pat Kraft said that athletics would be responsible for Franklin's buyout and not the university.

With this settled, Penn State can position its financial resources to its next football coach, its revenue-sharing plan and the $700 million Beaver Stadium renovation. Kraft said that Penn State's next coach will benefit from "elite-level resources."

"We are blessed because of our fans, our alums, and the support we receive that we can do more than most, and that we have elite resources here," Kraft said. "And so that allows us to be able to have real conversations and put our resources to the test in the best direction."

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Franklin moves to his third conference

Former Penn State Nittany Lions head coach James Franklin walks into Beaver Stadium prior to a game against the Oregon Ducks. | James Lang-Imagn Images

Franklin takes his third head-coaching job at Virginia Tech, following three seasons at Vanderbilt and 11+ at Penn State. He went 104-44 at Penn State, tied with Rip Engle for No. 2 on the program's all-time coaching wins list.

Franklin will coach in the ACC after being a head coach in the SEC and Big Ten. According to Virginia Tech President Tim Sands, Franklin's hiring resulted from an "unprecedented collaboration by our athletic administration with University leaders, esteemed alumni, including former NFL coaches and players, and our most dedicated supporters."

“Virginia Tech has attracted and hired an incredible head coach and extraordinary recruiter in James Franklin. The Board of Visitors enthusiastically supports this hire,” John Rocovich, Rector of the univeristy's Board of Visitors, said in a statement. “We signal to Hokie Nation, and the entire nation, the shared importance of athletic support and success.”

Franklin takes over a Virginia Tech program that has had five losing seasons since 2020. The Hokies last won nine games in 2017.

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