Your Brand Deal Is an Unsecured Loan to the Brand
Your Brand Deal Is an Unsecured Loan to the Brand
On September 8, LIV Golf filed for Chapter 11 bankruptcy in New Jersey. The creditor schedules run past 1,000 names, with at least 24 parties owed more than 1 million dollars each (Golf.com). Sixteenth on that list, ahead of two touring professionals, sits Rick Shiels Media, owed roughly 1.4 million dollars under a brand partnership agreement (Dexerto). Shiels is a golf creator with more than 3 million YouTube subscribers who signed on as a LIV ambassador in May 2025.
He is not a plaintiff. He is a line item.
The lesson is not about golf, and it is not about Saudi money. It is this: a brand partnership agreement, papered the way most of them are papered, functions as an unsecured loan from the creator to the brand. The creator performs first and collects later. That is a credit decision, and in most deals it is the one term nobody negotiates.
What the paper actually does
Look at the payment mechanics in a typical creator agreement. Compensation is tied to delivery, then invoiced, then paid on net 30, net 60, or worse. Multi-year ambassadorships pay quarterly or on campaign milestones. Performance and affiliate components pay in arrears off the brand's own reporting. Every one of those structures means the creator has already delivered the asset before the money moves.
Now look at the license. In most first drafts, the grant is effective on signature, runs for the full usage term, and is not conditioned on anything. The brand receives the rights the moment the deal is signed. The creator receives the money on a schedule. That asymmetry is invisible while the brand is solvent and total while it is not.
When the counterparty files, the agreement is an executory contract. The debtor can reject it. Rejection is treated as a breach, and the damages claim becomes a general unsecured claim, which sits behind secured lenders and behind whoever is funding the case. In LIV's filing, the Public Investment Fund provided 49.6 million dollars in debtor-in-possession financing at 12 percent interest, and BC Partners committed 300 million dollars in exit financing (Golf.com). New money keeps arriving. It is simply senior to the money already earned.
There is a second problem that gets missed. If the license grant is not conditioned on payment, the brand's campaign assets may keep running while the invoice goes unpaid. The creator's face stays attached to the brand through the worst news cycle the brand will ever have, and the compensation for that association is a claim in a queue. PIF had already said, months before the filing, that it would only fund the tour through the 2026 season. The creator side of these deals generally has no contractual mechanism to react to that kind of announcement.
What is usually not in the document
On the studio side, the version of a deal I saw most often assumed the counterparty was good for the money, because it was. Creators are increasingly signing with counterparties where that assumption does not hold: venture-funded brands, single-purpose leagues, subsidiaries with no assets, holding companies formed for one campaign. The paper has not caught up.
What is missing, in rough order of how much it matters:
Payment ahead of performance, or at least at each milestone. The business reason is simple. The party with less leverage should not be the one extending credit. Fallback: 50 percent on signature, balance on delivery, with the usage period starting only on receipt of the balance.
A guaranty from a creditworthy parent when the signing entity is a subsidiary or a special purpose vehicle. Check the signature block. If the entity was formed recently and holds nothing, the promise is decorative. Fallback: a net worth covenant plus escrow for the back half.
Termination on insolvency, bankruptcy filing, or a missed payment, with a cure period measured in days rather than a vague notice provision.
A license that snaps back. Condition the grant on payment. On nonpayment and failure to cure, the license terminates, the brand takes the assets down, and any residual use requires a new deal. Without this, nonpayment costs the brand nothing it was using anyway.
Exclusivity and category lockout that end when payment stops. A creator who is unpaid and still barred from competitors is paying twice.
Audit rights wherever compensation is variable, including affiliate splits and performance bonuses, since those numbers come from the brand's own systems.
One caution on the figures above. They come from LIV's own schedules, which are the debtor's characterization of what it owes. Amounts get amended, and claims get disputed.
The useful read on LIV is not that creators should screen out unstable brands. Everyone looks stable on the day of signature. The read is that the agreement should assume that at some point the money stops, and should say what happens next.