Tag Archives: factors

Fitch Rates NFL’s Football Trust Notes an ‘A’, in Spite of ‘Higher Concussion Related Costs’

Fitch Ratings has assigned an ‘A’ rating to the National Football League’s $106.1 million senior secured notes due 2024 (add-on) issued through Football Trust. The Rating Outlook is Stable.

The ‘A’ ratings reflect the NFL’s position as the most popular professional sports league in the U.S. The NFL has a strong and highly regarded economic model, which includes sizable multi-year television contracts, significant revenue sharing among member clubs, a proven track record of conservative financial policies, and its current collective bargaining agreement (CBA) with its players union which includes a ‘hard’ salary cap. Strong forecasted league-managed revenues, primarily national television contracts provide the league-wide borrowing program debt with solid projected debt service coverage ratios and low leverage.

The ‘A’ rating further reflects the mechanics of the lock-box account for the purposes of collecting national television revenues, which are the primary source of revenues that service the debt, prior to any distributions to individual franchises. Additionally, since each club receives an equal share of revenues, no franchise’s share of the national television revenues is affected by its on-field performance. The rating reflects the team-specific nature of the obligations and the lack of a corporate (joint and several) obligation of the NFL; however, Fitch notes the NFL’s oversight and policy of supporting distressed franchises as a key mitigating factor.

However, the first “negative” factor influencing the rating in the press release was the following:

“Higher Concussion Related Costs: Increased direct costs to the NFL from players electing to opt-out of the concussion settlement.”

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Concussion Expert Talks about the Prefect Storm of Factors Leading to a Concussion Problem, and Whether There Is a Crisis

Kevin Guskiewicz, co-director of the Matthew Gfeller Sport-Related Traumatic Brain Injury Research Center at the University of North Carolina, recently discussed concussions at the Durham Sports Club.

Specifically, he talked about how some factors can combine to make the perfect storm.

“You may be only 33 years old, but given your concussion history, given your genetic makeup, given the position you played and estimated overall exposure that you’ve had, it might be smart to think about hanging it up,” he said. Chameleon Injuries and the Threat of Misdiagnosis Head Trauma is Not Black and White“Then there are other people because of those factors and the trajectory they’re on, they think it’s fine to continue to play at age 33, 34.”

He also noted that the increase in concussions does not mean there are more of  them.

“We do not have a concussion crisis,” he said. “There are no more concussions occurring on our playing fields today than there was five years ago, 15, 25 years ago. The difference is that 10, 15, 20 years ago they went undiagnosed, unmanaged. Kids played through them. They didn’t know they had a concussion.”

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