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On further review, Donald Penn's deal wasn't nearly as good as advertised

NFL_penn.jpgLest 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.

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10 Responses to “On further review, Donald Penn's deal wasn't nearly as good as advertised”
  1. CTifer says: Aug 25, 2010 9:47 AM

    “So where’s the huge check that a premier player gets upon signing a long-term deal?”
    If Donald Penn were a premier player, maybe he’d get that huge check. He’s marginal, to slightly-above-average at best.

  2. Playmaker's Dealer says: Aug 25, 2010 9:49 AM

    Donawho?

  3. DcNinerFan says: Aug 25, 2010 9:52 AM

    That poor guy. I feel so sorry for him. We should hold a protest and demand he get more money… I’ll take off work so we can do it, right?

  4. sportstalkryan says: Aug 25, 2010 10:12 AM

    It’s interesting to see the unusually larger base salary figure for 2011. Normally we would see a small steady increase in base salary for each future year of the deal. But Penn’s 2011 salary is significantly higher than 2012. It appears that Penn’s agent successfully argued that Penn should not be financially penalized for the expected lockout. So if Penn misses 1/3 of his weekly paychecks for that reason, then he’ll still make a base salary of what he otherwise would have expected.

  5. Mangy66 says: Aug 25, 2010 10:19 AM

    A left tackle who’s decent at pass blocking but has been lackluster in run blocking.
    If he got $4 million per year, he should laugh his way to the bank.
    Maybe the Bucs are trying to buck (no pun intended) their trend of being cheap by throwing some money at Penn.
    But, therein lies the problem. It’s money poorly spent. Maybe they’ll throw a grip of cash at Trueblood too, and watch him get into more on-field fights.

  6. DailyRich says: Aug 25, 2010 10:24 AM

    Maybe not as good for Penn, but very good for the Bucs.

  7. notorious_buc says: Aug 25, 2010 10:25 AM

    I’d happily receive compensation for not allowing myself to become a lard ass.

  8. Rock48nj says: Aug 25, 2010 10:30 AM

    Since when does only fully guaranteed money matter.. in one breath thats all that matters in the Revis deal, in another the absurd deal Al Davis gave out is considered reasonable because of the Champ Bailey contract # this year…since Champ’s money this year is not guaranteed it should not factor at all in the discussion right?
    I also find this paragraph hilarious..
    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.
    You mean the player is going to actually be expected to perform to make his money? Can you believe the stones on these teams for not just giving them the money while the hang around and play PS3??

  9. Josh says: Aug 25, 2010 11:44 AM

    Shouldn’t Penn’s contract be considered progress? I mean after all, PFT has beat the drum as much as anyone that rookie contracts, particularly at the top of the draft, are out of control….

  10. Slow Joe says: Aug 25, 2010 1:44 PM

    That contract sounds about right. I’m not really sold on Penn, and at first blush I thought he was overpaid.

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