Representatives of football coach June Jones are claiming he had a verbal agreement to be let out of his contract with the University of Hawai'i without a financial penalty, people involved in the process say.

That is why the former Warriors coach has yet to pay the school $400,008 the contract says UH is owed in the event of termination before the June 30, 2008 expiration date, according to people familiar with the negotiations.

Jones, who compiled the most victories in school history against collegiate competition (76-41), announced his departure for Southern Methodist Jan. 7, six days after the Warriors' Sugar Bowl appearance. He is to receive a reported $2 million per season under a five-year contract.

Both Jones' agent, Leigh Steinberg, and Manoa Chancellor Virginia S. Hinshaw have said the parties have been in talks about the contract but have declined further comment.

People familiar with the situation say Jones' representatives maintain an understanding was reached during negotiations in 2003 that would have let Jones out of the contract, without penalty, provided the coach finished the first three years of the five-year deal at UH.

But current UH officials reportedly have said they have no record of such an agreement and the contract contains no provision to that end. Herman Frazier, who was athletic director at the time, was terminated a day after Jones left.

Under the terms of the five-year agreement Jones signed with UH in 2003, he owes the school $400,008 — the amount the school paid him for one season — "if he terminates this agreement prior to June 30, 2008," according to the contract.

Though Jones received $800,016 per year from UH, the school said half of it was paid by donations.

A clause in the agreement would have allowed him to exit in the fourth or fifth years for an NFL head coaching job under the same terms.

The contract said he was prohibited from accepting employment "under any circumstances as a men's football coach at any institution of higher education which is a member of the NCAA, or for any men's football team participating in any professional league or conference in the United States ... " prior "to the expiration date of the term of this agreement ... without first obtaining a written release or a negotiated settlement."

The contract states that "in the event the university releases coach of his obligations under this agreement, coach shall be responsible for paying to the university liquidated damages ... "