University of North Carolina Athletics
Carolina, Nike Sign New 10-Year Contract
July 1, 2009 | General
July 1, 2009
CHAPEL HILL, N.C. - The University of North Carolina at Chapel Hill and Nike Inc. have signed a new 10-year contract for Nike to be the exclusive supplier of athletic footwear, apparel and accessory products to the Tar Heels.
UNC and Nike signed the contract in late May. It took effect retroactive to July 1, 2008.
"The University of North Carolina is proud of its long-standing relationship with Nike," says Director of Athletics Dick Baddour. "This partnership has benefitted all 28 varsity sports and provided millions of dollars for academics and student scholarships at the University."
Nike will provide the athletic department with shoes, uniforms, coaching gear, balls and other equipment.
"It's important in these challenging economic times to put your athletic department on better financial footing, and this contract lessens and hopefully eliminates the need for our programs to purchase those items from their operating budgets," says Baddour. "A key part of the new contract is an increase in the amount of product our programs can order."
In addition to the apparel and equipment, which constitutes the majority of the value of the contract, Nike will give the University $2 million to the Chancellor's Academic Enhancement Fund. Chancellor Holden Thorp says he will direct the funds to faculty support.
Nike will also provide support for team tours, travel and hosting regular-season tournaments in several sports. The athletic department will also receive $1 million for signing the contract, with those funds being used to overhaul lighting and sound at the Dean E. Smith Center.
In the new agreement, Nike will continue to provide resources for an academic and athletic excellence fund. The academic and excellence fund, added in 2001, helps fund bonus payments to the coaches based on achievements of excellence by their respective student-athletes in the classroom and competitive arena.
Nike has also entered into individual contracts with each of UNC's head coaches, consistent with NCAA regulations and University policy. Nike will also provide annual summer internships for two students to honor the memory of Rutledge Tufts, former UNC licensing director who was instrumental in crafting fair labor practice standards, and former student body president Eve Carson.
Nike, UNC's top licensee of retail merchandise, will pay the University a premium royalty on the sale of Carolina-logoed merchandise. The rate exceeds the University's standard royalty rate.
Nike has the exclusive right to manufacture Carolina jerseys, including authentic, replica, vintage/throwback and fashion jerseys for baseball, basketball, football, lacrosse and soccer. These exclusive rights do not include youth and infant/toddler jerseys. UNC and Nike recognize the need for fans to have a variety of merchandise. Therefore, the new agreement allows for a special distribution strategy for the local market. In addition, Knights Apparel will manufacture UNC jerseys for sale in retail channels not covered by Nike. Together, these provisions will allow UNC jerseys to be available for sale by local area retailers to Tar Heel fans.
The University and Nike have affirmed their strong commitment to fair labor practices, a commitment that set an industry standard when adopted in the 2001 agreement. Under the terms of the license agreement, that standard remains in place. Nike will continue to produce licensed product and provide product to the University made in factories that provide fair working conditions and operate consistent with the labor standards in the University's license agreements and Nike's own Code of Conduct. Furthermore, as leaders in their respective fields, Nike and the University have both agreed to promote the ideals of human rights and social and environmental protections.
"We are proud that Nike recognizes and shares the University's commitment to values, integrity and excellence," adds Baddour. "Both UNC and Nike remain dedicated to the high quality of labor standards stated in our previous agreements, which are affirmed in this contract."
"The new contract with Nike will enhance scholarship assistance available to our students through the revenues generated by the trademark licensing program and sales at Student Stores," says Derek Lochbaum, director of trademark licensing. "The overall agreement positions the University to remain a leader in the industry."
Teams, coaches and staff will exclusively use Nike-provided products for official games, practices and clinics. Nike receives tickets and parking passes to home games and postseason tournaments, full-color sponsorships in football and men's basketball game programs, acknowledgement in media guides, schedule cards, public address announcements and TarHeelBlue.com, the athletic department's official Web site. Nike also has the right to use UNC marks to advertise its product, subject to University approval.
