James Franklin contract buyout: What he's owed after Penn State firing

The immediate question is the cost. Franklin's 10-year contract, signed in 2021 and running through 2031, carries a substantial buyout tied to his remaining guaranteed compensation. Estimates have it at roughly $56 million, and for reference, if Penn State had waited until the end of the season then it would have been $48 million. It remains unclear whether payments are due as a lump sum or over time, nor does it clearly define offset language if Franklin takes another job.

Key elements of Franklin’s deal are a base salary plus supplemental pay totaling roughly $8 million annually, retention bonuses, and that insurance loan; the agreement was amended in late 2024 to align certain incentives with the expanded College Football Playoff but did not publicly alter the term or basic structure.

Penn State has named associate head coach/cornerbacks coach Terry Smith as the interim head coach for the rest of the season. Co-defensive coordinator/safeties coach Anthony Poindexter was a name that also possibly received consideration

The timing places Vice President for Intercollegiate Athletics Pat Kraft in a compressed decision window. The Nittany Lions visit Iowa on Oct. 18 before a road trip to Ohio State on Nov. 1, with the early signing period set for Dec. 3–5, 2025.

What's next for Penn State?

• Interim/locker-room stabilization: Expect interim Terry Smith to help manage the quarterback room after Drew Allar's season-ending injury, and keep the roster intact through late October.
• Kraft is expected to run a national search and it isn't immediately certain whether interim head coach Terry Smith will have an opportunity to keep the position.