Huffman: Sources say sponsor reworks deal for FBR Open

Bad times have become the worst of times for Friedman, Billings and Ramsay, the financial institution that sponsors the FBR Open.

According to a report last week in the Washington Post, the economy has gotten so gloomy for the Arlington, Va.-based investment group/bank that the banking end of FBR is up for sale.

After yet another huge quarterly loss of $169 million, which follows similar losses in the past year dating back to a $210.6 million loss during the same quarter of 2007, FBR has been reduced to a penny stock on Wall Street. As CEO Eric Billings pointed out to the Post, the bank also is sitting on $273 million in debt, which is directly related to the subprime mortgage mess.

So how does FBR honor the last four years of a five-year contract with the tournament that runs through 2012 and represents roughly a $24million commitment to the Thunderbirds, the civic organization that runs the FBR Open?

Two different sources close to the Thunderbirds told me a new deal was recently brokered between FBR and the Thunderbirds that reduces FBR's overall financial commitment to the tournament "by millions." And the restructuring was all one-sided, with FBR telling the Thunderbirds it would walk if they didn't accept the terms.

According to those sources, FBR is going to keep its commitment to the tournament on several fronts. It will be the title sponsor and pick up TV costs, but it has reduced its charitable contributions significantly. And, as previously reported by the Tribune, FBR also will cut back on its entertainment commitment, which means the corporate hospitality, the pro-am and Tuesday night dinner.

John Felix, the 2009 FBR Open tournament chairman, said he could not comment on whether or not the Thunderbirds' contract with FBR had been amended.

"That's between FBR, the (PGA) Tour and us," Felix said. "As far as contractual terms, we don't discuss those details with other parties other than to say FBR is a great sponsor and will be so in 2009.

"The only thing I'll say about FBR is I can't give them enough credit. What they've done for our charities since 2004 in terms of (donations) is just staggering."

FBR, which did not return phone calls, has been nothing but a good thing for the tournament. Over a four-year span that began in '04, FBR has helped raise $25.67 million for charities, including a PGA Tour-record $7.8 million in 2007. And that figure will soon grow when yet another possible record amount from the 2008 tournament is announced at the FBR Open Tee-Off Luncheon on Nov. 20.

Tim Louis, the 2008 tournament chairman who is now the Big Chief of the Thunderbirds, also wouldn't confirm any new deal had been reworked with FBR. Louis was somewhat noncommittal when asked what the Thunderbirds would do if FBR gets sold.

"There are so many different scenarios that could come into play if that happens," Louis said, reiterating what Felix had previously said about FBR and the Thunderbirds still being "best of friends" and in close communication.

Despite the rumor about a new deal reducing charitable contributions, Louis said he fully expects charitable contributions to keep increasing in future years.

"That's always our goal every year, to give more to charity than any other tournament on the PGA Tour," Louis said. "I think that will continue in 2009 despite this economy."

Let's hope Louis is right, although I would not be surprised if FBR gives less to the tournament's charities this coming year and disappears as title sponsor in 2010, either by being sold or going belly up.

Regardless, if anyone can raise money without a corporate sponsor, even in trying times like these, it's the Thunderbirds and this community, which operate and attend the tournament like no other on the PGA Tour.