Franco, Schoop sell off future earnings for cash now
SAN FRANCISCO — Philadelphia third baseman Maikel Franco has agreed to sell 10 percent of his future earnings for $4.35 million to a company called Fantex, which plans to sell securities to investors.
Baltimore second baseman Jonathan Schoop struck a deal to sell 10 percent of his future earnings for $4.91 million and Houston pitcher Collin McHugh struck an agreement to sell 10 percent for $3.96 million, the company said Wednesday. Fantex said the deals are contingent on the company obtaining financing to make the payments and include earnings from defined "future on- and off-field cash flows."
In addition, the company reached agreements with San Diego infielder Yangervis Solarte (11 percent for $3.15 million) and Minnesota pitcher Tyler Duffey (10 percent for $2.23 million).
Last September, Fantex agreed to pay Los Angeles Angels pitcher Andrew Heaney $3.34 million for 10 percent.
All the baseball players who reached agreements are making just above the major league minimum of $507,500. McHugh and Schoop likely will be eligible for salary arbitration for the first time next winter, Francoand Heaney in 2018 and Duffy in 2019.
"We have an agreement with Fantex that allows them to approach players for inclusion on the Fantex platform," players' association head Tony Clark said. "Players retain the right to decide for themselves whether to do a deal with Fantex."
Major League Baseball said player agreements with Fantex do not violate its rules.
In its announcement Wednesday, Fantex also announced a deal with Jacksonville wide receiver Allen Robinson (12 percent for $4.6 million) and agreements with four golfers: Kelly Kraft (15 percent for $2.28 million), Scott Langley (15 percent for $3.06 million), Jack Maguire (11 percent for $2.07 million) and Kyle Reifers (15 percent for $1.74 million).
It is unclear what securities involving these athletes Fantex will propose to sell to investors. The company said it has withdrawn a November filing it made with the Securities and Exchange Commission proposing to have an initial public offering of Fantex Sports Portfolio 1 Units that would have been tied to the earnings of 10 players in two sports.
"In light of our most recent signings, we are working with our advisers on the most appropriate way to potentially package and offer our unique asset class to investors," Fantex chief executive officer Buck French said in a statement.
Fantex has launched tracking stocks for several NFL players, including Buffalo quarterback EJ Manuel, Chicago wide receiver Alshon Jeffery, Indianapolis guard Jack Mewhort and Washington tight end Vernon Davis.