However, the company has made a single payment of just $5,000 since last summer, says Ron Strollo, YSU’s director of athletics. Two weeks after The Business Journal filed a records request with the university, West Coast Chill made its first installment payment of $100,000, reducing its balance to $200,000. The company then promised to make two additional payments to the university of $100,000 each in October and December of 2020.
“He had sent us a new payment schedule in late fall or December,” that revised the earlier payment plan, Strollo says. However, that schedule was scrapped because of the effects the COVID-19 pandemic was having on Joseph’s operations in California and the United Kingdom. The debt stems from a marketing agreement that Joseph and West Coast Chill signed with YSU in 2014.
Strollo says he’s hopeful Joseph and West Coast Chill will increase its payments by the summer. However, no firm timetable on the repayment plan has yet been negotiated, he says. According to the contract, West Coast Chill was to pay YSU $51,250 per year for a sponsorship package to promote the company’s non-caffeinated energy drink. The agreement was signed July 17, 2014, and good for two years with the option to renew each year for the next 10 years. Years three through 10 would include a 5% increase annually, the agreement stipulates.
With both plants idled, Strollo and the athletics department agreed about two months ago to trim the payment plan to just $5,000 per month until both of his plants were running again at capacity, Strollo says. “I think we’ve received one payment, so a second one should be coming soon.” “Two weeks later, the governor of California shut his plant down” in response to surging COVID rates in that state. Simultaneously, a second plastics-injection molding operation Joseph owns in England was also shut down because of the pandemic.
West Coast Chill would also receive membership in the Penguin Club for football and basketball games, as well as hospitality and advertising rights to Penguin Club events such as its scholarship golf outing and silent auction. The agreement included permanent signage at Stambaugh Stadium, signage at YSU’s new softball field, auxiliary scoreboard and media table advertising in Beeghly Center, website advertising, and full-page color ads in YSU’s football and basketball programs. Live promotional spots and 30-second commercials aired during football and basketball radio broadcasts were also included in the deal.
Joseph explained to The Business Journal last year that he believed his contributions to the university outside of the athletics advertising deal would offset costs related to the marketing agreement. According to Joseph, he and his companies have spent at least $112,500 over the years to support YSU though charitable contributions, donations, event sponsorships and in-kind contributions. However, West Coast Chill’s energy drink failed to sell in this region. The company discontinued selling the product in Ohio in 2016. The university also agreed to sell West Coast Chill products at all on-campus athletic facilities and select Penguin Club events. And, YSU said it would endow an athletics scholarship in the name of the Joseph family, which would be housed at the YSU Foundation. According to records, the company paid $10,000 toward the scholarship in 2017.
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