Lest we be accused (again) of picking only on the Jets when it comes to long-term contracts given to key players that, upon inspection, aren’t nearly as valuable as first reported, let’s take a closer look at the deal recently signed by Buccaneers left tackle Donald Penn.
Touted as a six-year, $48 million contract with $20 million guaranteed, the deal is not quite that potent.
For starters, the maximum value of the contract is $47.2 million. Sure, we’re only talking about $800,000 of upward fluff, but who wouldn’t gladly accept a check for $800,000? The significance of the 800 large in funny money is that it moves the average of the package to $8 million per year, allowing Penn’s agent to tell his family, friends, and (most importantly) prospective clients that he got Penn a deal worth $8 million per year.
Also, $5.5 million of the $47.2 million is tied up in “not likely to be earned incentives” payable in the final year of the deal. We’ll assume for now that it’s a phantom incentive, aimed at getting the average closer to $8 million than what it would be without the “not likely to be earned incentives” — less than $7 million per year.
The base value of the contract is $36.7 million, and it comes from the following payments: a $2 million signing bonus, a $4.5 million base salary in 2010, a $7.2 million base salary in 2011, a $5.1 million base salary in 2012, a $5.0 million base salary in 2013, a $6.4 million base salary in 2014, and a $6.5 million base salary in 2015. From 2011 through 2015, Penn also is eligible for $400,000 annually in workout bonuses, and $600,000 per year in weight-clause incentives. If he complies, the base value increases to $41.7 million.
So where’s the huge check that a premier player gets upon signing a long-term deal? To no surprise, there isn’t one. Penn received $2 million to put his Hancock on the page (yeah, it’s $2 million — but usually high-end left tackles get a lot more), and the rest of the guarantees come in the form of base salary.
The $4.5 million base salary in 2010 is truly guaranteed, both for injury and skill. The $7.2 million base salary in 2011 and the $5.1 million base salary in 2012 are guaranteed for injury only — and thus not truly guaranteed. If, as we’ve explained in relation to other players, Penn has a non-career-ending injury that limits his actual or perceived skill, he possibly will get cut, and thus not get paid more than $12 million in supposedly guaranteed money.
Also, if he simply doesn’t play well, he could get cut after 2010, and thus not get paid more than $12 million in supposedly guaranteed money.
Even with the injury guarantee regarded as an actual guarantee (even though it isn’t), his total guarantee is only $18.8 million. Not chump change, but it doesn’t sound quite as good as a cool $20 million.
The actual guarantee? Only $6.5 million, with the obligation in each of the next two years falling on Penn to play well, to keep his weight down, and to avoid an injury that while not fatal to his career would be sufficiently bad to prompt the team to conclude that his skills have diminished.