Dive Brief:

• Sports Authority has negotiated a deal with lenders that will allow its liquidation process to continue; without the deal stores involved would have likely shuttered and liquidation sales would have halted by Friday, according to a court document filed Tuesday.

• Lenders involved have agreed to take just $71 million of the $240 million they say they’re owed, and will give Sports Authority access to cash to cover liquidation costs. This includes payment in full for vendors that shipped goods after the March Chapter 11 filing, payments to bankruptcy professional fees, and an 85% payment to landlords.

• Other court documents reveal that lenders have agreed to some $2.85 million in bonuses to senior executives; four top executives will get some $1.5 million of that, according to the Wall Street Journal.

Dive Insight:

Early in its Chapter 11 saga, Sports Authority took pains to refute the notion that liquidation was in the cards; now it’s scrambling to save the liquidation process.

The proceedings have been marked with various legal tussles, including more than 160 lawsuits the retailer filed in March. At issue then was some $85 million worth of winter gear and other goods being sold at Sports Authority stores—items suppliers wanted returned because they feared not getting paid.

Some of those fears are coming to pass as various stakeholders clamor for the dregs of the sporting good retailer’s once-thriving operations.

Sports Authority was once the largest sporting goods chain in the U.S., and in 2006, when the retailer was acquired by private equity firm Leonard Green & Partners for $1.3 billion, its future was bright. But mounting debt, weak e-commerce returns and increased competition, including from general merchandise brands like Wal-Mart, Target, and, of course, Amazon, and from apparel retailers like Gap, took it down. Also facing these troubles, other sporting goods stores have exited the marketplace in recent months. 

After a elongated auction, Dick's Sporting Goods last month won the right to Sports Authority's intellectual property with a $15 million bid. 

Matt Powell, a sports industry analyst at the NPD Group, said that those Sports Authority stores could provide Dick’s a natural way to create an off-price chain using the Sports Authority name. Off-price retail, led by TJX Cos., is a thriving area in retail, though there’s some evidence that retailers with flagship brands suffer some cannibalization by their off-price efforts.

The deal also provides Dick's with Sports Authority's customer data, including 28.5 million members of its loyalty program and 114 customer files. This information will be highly valuable to Dick's, which can use it in marketing efforts for both physical stores and the retailer's online site.