BLOOMINGTON – The contract amendment Mike Woodson signed August 2023 added not just additional salary but also bolstered buyout protections to his original deal with Indiana. But it also contained language which would mitigate the immediacy of the university’s duty to Woodson in the event of termination without cause.
Said amendment upped Woodson’s pay from $3 million per year guaranteed to approximately $4.2 million per year guaranteed. It added a substantial amount of outside, marketing and promotional income to achieve that raise, as well as converting a handful of bonuses to guaranteed compensation.
In the amendment, Indiana’s buyout obligation in the event of Woodson’s firing stretched by an extra year.
IU typically builds buyouts into its head-coaching contracts via a commitment to pay either 100% or 50% of remaining guaranteed salary, setting a timeline according to the contract’s annual rollover for when that duty is halved.
Under the terms of his original contract, Woodson would have been owed 100% of remaining compensation through March 31, 2025, and then 50% thereafter. In addition to his raise in 2023 summer, Woodson also gained an extra year of full buyout protection. Indiana would now owe all remaining guaranteed compensation — roughly $8.4 million and reducing monthly — through March 30, 2026.
But the amendment also contained a caveat uncommon in IU’s recent contractual history: If it so chooses, Indiana can fulfill its buyout obligation via annual lump sum payments of $1 million.
Typically, buyouts must be paid over the normal life of their contract, in monthly installments as though the coach in question were essentially just still on payroll. Like most such contracts, Woodson also has a duty to mitigate his buyout by seeking similar employment in basketball. Any compensation he received from such employment would reduce IU’s concurrent obligation.
Under the terms of the language inserted into his contract via the 2023 amendment, however, Indiana could stretch Woodson’s buyout into annual $1 million installments, substantially alleviating the immediate financial burden on the university.
Woodson’s mitigation duty would only apply through the life of his current deal, which runs through March 31, 2027. After that date, he would have no responsibility to seek employment mitigating Indiana’s buyout responsibility to him.
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