That loud roar you heard after Michael Vick signed his new contract with the Philadelphia Eagles was from his various creditors who all stand to be paid in full.
The best case scenario is that Vick’s collects around $80 million of his $100 million deal, and if he does about $20 million of that will go to his creditors. He will have a lot left over to live very comfortably debt free.
Here are the details.
In 2009, about a month after Vick was released following 18 months in prison on a dogfighting conviction, a federal judge in Virginia approved his Chapter 11 bankruptcy plan to repay about $20 million in debts. Vick had lost the 10-year, $130 million contract he signed with the Atlanta Falcons in 2004.
“I would say that this confirms that the creditors made the right decision by putting their faith in Mr. Vick rehabilitating his career and his reputation,” says Norfolk, Va., attorney Ross Reeves, counsel for the Committee of Unsecured Creditors in the Vick bankruptcy.
Under terms of the bankruptcy, which runs through 2014 and required Vick to sell off multiple homes, vehicles and other assets, he agreed to pay “significant amounts of his future income” toward debts. The schedule is based on how much he earns each year — before taxes. It stipulates these paybacks to creditors:
40% of income above $10 million
Even if Vick just collects around the $35 million he is guaranteed, he will still be able to clear his debt with some make it rain money left over.
Has to be a relief to him and his creditors to finally get this long term deal done.