Explain Roster Bonuses to Me (1 Viewer)

[David Yudkin]

So I was reading up on the terms of Asante Samuel's new deal with the Iggles (url="http://www.philly.com/philly/sports/eagles/20080306_Asante_Samuel_is_Eagles_highest-paid_defender.html"]LINKAGE)

And I got to the following description:

Samuel, who signed with the Eagles on Friday, when the free-agent market opened, received a $6 million signing bonus and $7 million roster bonuses for 2008 and 2009, bringing his total guaranteed money to $20 million.

To the letter of the law, I was under the presumption that roster bonuses ARE NOT guaranteed and that the player has to be on the roster to collect them. It's pretty obvious that Samuel will suit up this year, so I count a $6 million signing bonus and a $7 million roster bonus for this year = $13 million in bonuses.But if something happened (he was terrible . . . he got hurt . . . he had an off-field issue, etc.) that they could just release him. In which case that second roster bonus would never get paid out.

So someone explain to me where Samuel is "guaranteed" $20 million.

 

[zadok]

He would have to be cut before the 2009 season began to miss out on the final $7Million I guess.

 

[Reaper]

Dave - I'm going to guess and I was thinking of this same thing which is leading to confusion over the Calvin Pace Deal...

Pace's Deal was 1st reported as a 42 million dollar deal with 20 million guaranteed.. (rough numbers)

Then people said WHOA!!! It's "only" 12.5 million guaranteed !!! .. hmm, but, with a 9 million dollar roster bonus in 09'....(again, not exact numbers)

I bet what that does is allow the team to pay the Guaranteed money early on when they know they have the money and before other known contracts come up...

So, Instead of "Guaranteeing" Pace the whole 20 million or so, that has to be spread out evenly through the contract - They can pay down a huge part of it in one chunk...

To me it looks to all be "Guaranteed" But, just paid out differently - But, maybe I'm totally wrong

 

[humphrp]

Is there anyplace to find actual copies of the contracts? This would help us to understand exactly how it is paid out.

 

[moondog]

For cap purposes roster bonuses only count against the cap in the year they are paid so it does not count a prorated amount against the cap each year like a signing bonus. Usually teams then convert the roster bonus into a signing bonus the year it is due to then spread out its cap hit over multiple years. It lets a team lessen the cap hit in the first year or two. Just another way to fit a large signing and roster bonuses under the cap. Teams have to 'guarantee' the roster bonus or else a why would a player accept it over just a larger signing bonus.

 

[Please See Mine]

I think they are just guaranteeing that he will be on the roster in 2009, or at least receive the money for it. The contract likely states that he cannot be cut until after the 2009 season, or somehow they wrote that he gets $7 million guaranteed that will be classified as a 2009 roster bonus for cap purposes, but maybe they are actually allowed to cut him.

http://www.igglesblog.com/iggles_blog/2008...te-samuels.html

 

[AB in DC]

So someone explain to me where Samuel is "guaranteed" $20 million.

Probably just sloppy wording in the article. I'm guessing it's a different $7 million (or whatever) that's guaranteed, not just a roster bonus alone.

 

[massraider]

So someone explain to me where Samuel is "guaranteed" $20 million.

Probably just sloppy wording in the article. I'm guessing it's a different $7 million (or whatever) that's guaranteed, not just a roster bonus alone.

This is my theory. I think a lot of this money is not technically guaranteed, but falls under the category of "may as well be" guaranteed.

 

[Christo]

For cap purposes roster bonuses only count against the cap in the year they are paid so it does not count a prorated amount against the cap each year like a signing bonus. Usually teams then convert the roster bonus into a signing bonus the year it is due to then spread out its cap hit over multiple years. It lets a team lessen the cap hit in the first year or two. Just another way to fit a large signing and roster bonuses under the cap. Teams have to 'guarantee' the roster bonus or else a why would a player accept it over just a larger signing bonus.

Then why do we hear that so-and-so was released because his roster bonus was coming due?For example:

But business is business in the NFL, and with Bruce turning 36 next season, the Rams thought the $5 million he was due in 2008 could be better spent elsewhere.

With a $2 million roster bonus due today, Bruce apparently declined to accept a pay cut proposed by the club, leading to his release. Besides the roster bonus, Bruce was scheduled to make $3 million in base salary in 2008.

The team's final offer to Bruce apparently was $3 million — in other words, the base salary minus the roster bonus.

STLtoday

 

[igglesblogman]

Hey guys, saw the link. You're all right. Signing bonuses and roster bonuses are pretty similar. The difference is how they are treated under the salary cap. Signing bonuses are prorated over the course of the contract, so if a player received a $5 million signing bonus on a five-year contract, $1 million of that bonus would count against the contract each season. (If the player is then cut, the amount that hasn't yet been counted against the cap "accelerates" into the season he's cut, with some complicating factors such as when they released him, etc.)

A nonguaranteed roster bonus counts fully against the cap for the year in which it's paid. Because the Eagles have so much available cap room at the moment, they chose to structure the deal with most of the cap hit occurring early in the contract.

A guaranteed roster bonus is prorated the same way a signing bonus is, which is actually one way teams can give themselves a little more cap flexibility. Assuming Samuel's 2009 roster bonus isn't guaranteed, right now it will count $7 million against next year's cap. If the Eagles suddenly ran out of cap space next year, they could spread that hit out by "guaranteeing" it. The Eagles like to use this roster bonus setup for exactly that reason. It gives them the flexibility to maximize the amount of money they're spending against the cap each year, no matter how the final roster shakes out.

It's true that people aren't always precise in the way they throw around the term "guaranteed money" (including me), which is why a lot of people report the money made in the first three years of the deal, since it's assumed that the player will be around at least that long.

 

[Jeff Pasquino]

So I was reading up on the terms of Asante Samuel's new deal with the Iggles (url="http://www.philly.com/philly/sports/eagles/20080306_Asante_Samuel_is_Eagles_highest-paid_defender.html"]LINKAGE)

And I got to the following description:

Samuel, who signed with the Eagles on Friday, when the free-agent market opened, received a $6 million signing bonus and $7 million roster bonuses for 2008 and 2009, bringing his total guaranteed money to $20 million.

To the letter of the law, I was under the presumption that roster bonuses ARE NOT guaranteed and that the player has to be on the roster to collect them. It's pretty obvious that Samuel will suit up this year, so I count a $6 million signing bonus and a $7 million roster bonus for this year = $13 million in bonuses.But if something happened (he was terrible . . . he got hurt . . . he had an off-field issue, etc.) that they could just release him. In which case that second roster bonus would never get paid out.

So someone explain to me where Samuel is "guaranteed" $20 million.

Is this the same guy who said he was tired of posting explanations of contracts?Just checking.

 

[moondog]

For cap purposes roster bonuses only count against the cap in the year they are paid so it does not count a prorated amount against the cap each year like a signing bonus. Usually teams then convert the roster bonus into a signing bonus the year it is due to then spread out its cap hit over multiple years. It lets a team lessen the cap hit in the first year or two. Just another way to fit a large signing and roster bonuses under the cap. Teams have to 'guarantee' the roster bonus or else a why would a player accept it over just a larger signing bonus.

Then why do we hear that so-and-so was released because his roster bonus was coming due?For example:

But business is business in the NFL, and with Bruce turning 36 next season, the Rams thought the $5 million he was due in 2008 could be better spent elsewhere.

With a $2 million roster bonus due today, Bruce apparently declined to accept a pay cut proposed by the club, leading to his release. Besides the roster bonus, Bruce was scheduled to make $3 million in base salary in 2008.

The team's final offer to Bruce apparently was $3 million — in other words, the base salary minus the roster bonus.

STLtoday

Maybe because players do not always perform up to the level the team expected and/or the feel the player is declining and the team decides the player is not worht the roster bonus. Just like your Bruce example.

 

[David Yudkin]

For cap purposes roster bonuses only count against the cap in the year they are paid so it does not count a prorated amount against the cap each year like a signing bonus. Usually teams then convert the roster bonus into a signing bonus the year it is due to then spread out its cap hit over multiple years. It lets a team lessen the cap hit in the first year or two. Just another way to fit a large signing and roster bonuses under the cap. Teams have to 'guarantee' the roster bonus or else a why would a player accept it over just a larger signing bonus.

Then why do we hear that so-and-so was released because his roster bonus was coming due?For example:

But business is business in the NFL, and with Bruce turning 36 next season, the Rams thought the $5 million he was due in 2008 could be better spent elsewhere.

With a $2 million roster bonus due today, Bruce apparently declined to accept a pay cut proposed by the club, leading to his release. Besides the roster bonus, Bruce was scheduled to make $3 million in base salary in 2008.

The team's final offer to Bruce apparently was $3 million — in other words, the base salary minus the roster bonus.

STLtoday

Maybe because players do not always perform up to the level the team expected and/or the feel the player is declining and the team decides the player is not worht the roster bonus. Just like your Bruce example.

Which is precisely why I asked why roster bonuses were getting labeled as guaranteed money.

 

[scott72]

A guaranteed roster bonus is essentially a signing bonus. Signing bonuses are guaranteed. They are spread out over the life of the contract and if said player is cut, then the remaining bonuses accelerate to that year he's cut and paid out from the cap. An unguaranteed roster bonus is paid out only if said player is still on the roster that year. A team can avoid paying the roster bonus by cutting that player by a certain date.

Also an unguaranteed roster bonus cannot exceed the total thats been paid to that player at the end of the current year. For instance, if said player is paid 3, 5, 7 for the first 3 years, then his roster bonus cannot exceed 15 million in year 3. Hope that helps clear things up.

 

[David Yudkin]

A guaranteed roster bonus is essentially a signing bonus. Signing bonuses are guaranteed. They are spread out over the life of the contract and if said player is cut, then the remaining bonuses accelerate to that year he's cut and paid out from the cap. An unguaranteed roster bonus is paid out only if said player is still on the roster that year. A team can avoid paying the roster bonus by cutting that player by a certain date. Also an unguaranteed roster bonus cannot exceed the total thats been paid to that player at the end of the current year. For instance, if said player is paid 3, 5, 7 for the first 3 years, then his roster bonus cannot exceed 15 million in year 3. Hope that helps clear things up.

From my understanding, you have to be on the roster on the specified date or you don't get the money. Thus it would not be guaranteed. I was under the impression that teams can play with the accounting of "upfornt money" or signing bonuses so teams could opt to convert signing bonus dollars into roster bonuses and take more of the the cap hit in that particular season if they so chose.For example, PLAYER X got a $12 million signing bonus and a 4 year contract. The team elects to spread out the bonus equally over all 4 years ($3 million per year). The team opts after the first year to convert $3 million of the prorated money into a roster bonus for a date that already passed in that first season. So that year they would take a $6 million cap hit instead of $3 million and moving forward they would take a $2 million per year salary cap charge for the remaining signing bonus money ($6 million remaining over 3 seasons).However, I have yet to see a player get paid a roster bonus when no longer on that team's roster, so by practical definition it could not be a guaranteed bonus. By my English, guaranteed means you get it no matter what, without terms or qualifying conditions.So long story short, I have not heard of guaranteed roster bonuses until recently (if they actually exist). I could see if there was a deferred payment clause that guaranteed money at a later date . . . but that would be a deferred payment not a roster bonus (again using English terms not legalese).

 

[scott72]

A guaranteed roster bonus is essentially a signing bonus. Signing bonuses are guaranteed. They are spread out over the life of the contract and if said player is cut, then the remaining bonuses accelerate to that year he's cut and paid out from the cap. An unguaranteed roster bonus is paid out only if said player is still on the roster that year. A team can avoid paying the roster bonus by cutting that player by a certain date. Also an unguaranteed roster bonus cannot exceed the total thats been paid to that player at the end of the current year. For instance, if said player is paid 3, 5, 7 for the first 3 years, then his roster bonus cannot exceed 15 million in year 3. Hope that helps clear things up.

From my understanding, you have to be on the roster on the specified date or you don't get the money. Thus it would not be guaranteed. I was under the impression that teams can play with the accounting of "upfornt money" or signing bonuses so teams could opt to convert signing bonus dollars into roster bonuses and take more of the the cap hit in that particular season if they so chose.For example, PLAYER X got a $12 million signing bonus and a 4 year contract. The team elects to spread out the bonus equally over all 4 years ($3 million per year). The team opts after the first year to convert $3 million of the prorated money into a roster bonus for a date that already passed in that first season. So that year they would take a $6 million cap hit instead of $3 million and moving forward they would take a $2 million per year salary cap charge for the remaining signing bonus money ($6 million remaining over 3 seasons).However, I have yet to see a player get paid a roster bonus when no longer on that team's roster, so by practical definition it could not be a guaranteed bonus. By my English, guaranteed means you get it no matter what, without terms or qualifying conditions.So long story short, I have not heard of guaranteed roster bonuses until recently (if they actually exist). I could see if there was a deferred payment clause that guaranteed money at a later date . . . but that would be a deferred payment not a roster bonus (again using English terms not legalese).

yep thats how it works. If the team is in good cap shape like the Packer's for instance they can eat up more cap by accelerating guaranteed roster bonuses to the current year, turning it into a roster bonus, which frees up more cap room in the future. Now take another team like the Skins. They usually "back load" contracts in order to be able to sign more FA's. They can do this my putting most of the guaranteed roster bonuses toward the end of the contract. However, if they cut that player then the guaranteed bonuses are due immediately and hit the cap for that year. Signing bonuses are evenly spread out. They can't "back load" those, but can convert them into roster bonuses if they feel they want to pay the bonus early. Hope I didn't confuse you further. All this mumbo jumbo really makes you appreciate the capologists out there that live for this stuff.

 

[Mungo Burrows]

A guaranteed roster bonus is essentially a signing bonus. Signing bonuses are guaranteed. They are spread out over the life of the contract and if said player is cut, then the remaining bonuses accelerate to that year he's cut and paid out from the cap. An unguaranteed roster bonus is paid out only if said player is still on the roster that year. A team can avoid paying the roster bonus by cutting that player by a certain date. Also an unguaranteed roster bonus cannot exceed the total thats been paid to that player at the end of the current year. For instance, if said player is paid 3, 5, 7 for the first 3 years, then his roster bonus cannot exceed 15 million in year 3. Hope that helps clear things up.

From my understanding, you have to be on the roster on the specified date or you don't get the money. Thus it would not be guaranteed. I was under the impression that teams can play with the accounting of "upfornt money" or signing bonuses so teams could opt to convert signing bonus dollars into roster bonuses and take more of the the cap hit in that particular season if they so chose.For example, PLAYER X got a $12 million signing bonus and a 4 year contract. The team elects to spread out the bonus equally over all 4 years ($3 million per year). The team opts after the first year to convert $3 million of the prorated money into a roster bonus for a date that already passed in that first season. So that year they would take a $6 million cap hit instead of $3 million and moving forward they would take a $2 million per year salary cap charge for the remaining signing bonus money ($6 million remaining over 3 seasons).However, I have yet to see a player get paid a roster bonus when no longer on that team's roster, so by practical definition it could not be a guaranteed bonus. By my English, guaranteed means you get it no matter what, without terms or qualifying conditions.So long story short, I have not heard of guaranteed roster bonuses until recently (if they actually exist). I could see if there was a deferred payment clause that guaranteed money at a later date . . . but that would be a deferred payment not a roster bonus (again using English terms not legalese).

At least for a while, teams were using option clauses and such to get around some of this. There would be a roster bonus for $x on a certain date, but another clause stated that if the team declined an option to keep them through that point, the following year would be fully guaranteed at...you guessed it...$x. This way, the payment is essentially guaranteed one way or another, but the team doesn't have to pay it, or include even a prorated portion of it on the cap, this year. Not saying that's what happened in the Samuel case, but I'm pretty sure it's been done before. Another thing that's been done quite a bit lately when reporting these contracts is when the signing bonus itself is large enough that the cap acceleration makes cutting the player prohibitive before a certain point, they consider the payments up to that point effectively guaranteed for reporting purposes. Since the signing bonus is only $6m, that doesn't seem to apply here. They would accelerate $5m to avoid the $7m which is at least plausible. I would consider his base salary in 08 to be more 'effectively guaranteed' than his 09 roster bonus.IMHO this is probably just sloppy reporting and is likely a case of the reporter taking the info that was spoon-fed to them from the agent and reporting it as such without checking the facts.

 

[Christo]

For cap purposes roster bonuses only count against the cap in the year they are paid so it does not count a prorated amount against the cap each year like a signing bonus. Usually teams then convert the roster bonus into a signing bonus the year it is due to then spread out its cap hit over multiple years. It lets a team lessen the cap hit in the first year or two. Just another way to fit a large signing and roster bonuses under the cap. Teams have to 'guarantee' the roster bonus or else a why would a player accept it over just a larger signing bonus.

Then why do we hear that so-and-so was released because his roster bonus was coming due?For example:

But business is business in the NFL, and with Bruce turning 36 next season, the Rams thought the $5 million he was due in 2008 could be better spent elsewhere.

With a $2 million roster bonus due today, Bruce apparently declined to accept a pay cut proposed by the club, leading to his release. Besides the roster bonus, Bruce was scheduled to make $3 million in base salary in 2008.

The team's final offer to Bruce apparently was $3 million — in other words, the base salary minus the roster bonus.

STLtoday

Maybe because players do not always perform up to the level the team expected and/or the feel the player is declining and the team decides the player is not worht the roster bonus. Just like your Bruce example.

If it's guaranteed, how was STL able to keep from paying it whatever its expectations of Bruce?

 

[scott72]

For cap purposes roster bonuses only count against the cap in the year they are paid so it does not count a prorated amount against the cap each year like a signing bonus. Usually teams then convert the roster bonus into a signing bonus the year it is due to then spread out its cap hit over multiple years. It lets a team lessen the cap hit in the first year or two. Just another way to fit a large signing and roster bonuses under the cap. Teams have to 'guarantee' the roster bonus or else a why would a player accept it over just a larger signing bonus.

Then why do we hear that so-and-so was released because his roster bonus was coming due?For example:

But business is business in the NFL, and with Bruce turning 36 next season, the Rams thought the $5 million he was due in 2008 could be better spent elsewhere.

With a $2 million roster bonus due today, Bruce apparently declined to accept a pay cut proposed by the club, leading to his release. Besides the roster bonus, Bruce was scheduled to make $3 million in base salary in 2008.

The team's final offer to Bruce apparently was $3 million — in other words, the base salary minus the roster bonus.

STLtoday

Maybe because players do not always perform up to the level the team expected and/or the feel the player is declining and the team decides the player is not worht the roster bonus. Just like your Bruce example.

If it's guaranteed, how was STL able to keep from paying it whatever its expectations of Bruce?

His roster bonus wasn't guaranteed, and neither are base salaries. If he had any signing bonus left on his deal, then he would have been paid that upon his release.

 

[Christo]

For cap purposes roster bonuses only count against the cap in the year they are paid so it does not count a prorated amount against the cap each year like a signing bonus. Usually teams then convert the roster bonus into a signing bonus the year it is due to then spread out its cap hit over multiple years. It lets a team lessen the cap hit in the first year or two. Just another way to fit a large signing and roster bonuses under the cap. Teams have to 'guarantee' the roster bonus or else a why would a player accept it over just a larger signing bonus.

Then why do we hear that so-and-so was released because his roster bonus was coming due?For example:

But business is business in the NFL, and with Bruce turning 36 next season, the Rams thought the $5 million he was due in 2008 could be better spent elsewhere.

With a $2 million roster bonus due today, Bruce apparently declined to accept a pay cut proposed by the club, leading to his release. Besides the roster bonus, Bruce was scheduled to make $3 million in base salary in 2008.

The team's final offer to Bruce apparently was $3 million — in other words, the base salary minus the roster bonus.

STLtoday

Maybe because players do not always perform up to the level the team expected and/or the feel the player is declining and the team decides the player is not worht the roster bonus. Just like your Bruce example.

If it's guaranteed, how was STL able to keep from paying it whatever its expectations of Bruce?

His roster bonus wasn't guaranteed, and neither are base salaries. If he had any signing bonus left on his deal, then he would have been paid that upon his release.

That makes more sense. I was confused because moondog had originally left me with the impression that roster bonuses were guaranteed:

For cap purposes roster bonuses only count against the cap in the year they are paid so it does not count a prorated amount against the cap each year like a signing bonus. Usually teams then convert the roster bonus into a signing bonus the year it is due to then spread out its cap hit over multiple years. It lets a team lessen the cap hit in the first year or two. Just another way to fit a large signing and roster bonuses under the cap. Teams have to 'guarantee' the roster bonus or else a why would a player accept it over just a larger signing bonus.

 

[garyd]

For cap purposes roster bonuses only count against the cap in the year they are paid so it does not count a prorated amount against the cap each year like a signing bonus. Usually teams then convert the roster bonus into a signing bonus the year it is due to then spread out its cap hit over multiple years. It lets a team lessen the cap hit in the first year or two. Just another way to fit a large signing and roster bonuses under the cap. Teams have to 'guarantee' the roster bonus or else a why would a player accept it over just a larger signing bonus.

Then why do we hear that so-and-so was released because his roster bonus was coming due?For example:

But business is business in the NFL, and with Bruce turning 36 next season, the Rams thought the $5 million he was due in 2008 could be better spent elsewhere.

With a $2 million roster bonus due today, Bruce apparently declined to accept a pay cut proposed by the club, leading to his release. Besides the roster bonus, Bruce was scheduled to make $3 million in base salary in 2008.

The team's final offer to Bruce apparently was $3 million — in other words, the base salary minus the roster bonus.

STLtoday

Maybe because players do not always perform up to the level the team expected and/or the feel the player is declining and the team decides the player is not worht the roster bonus. Just like your Bruce example.

If it's guaranteed, how was STL able to keep from paying it whatever its expectations of Bruce?

His roster bonus wasn't guaranteed, and neither are base salaries. If he had any signing bonus left on his deal, then he would have been paid that upon his release.

That makes more sense. I was confused because moondog had originally left me with the impression that roster bonuses were guaranteed:

For cap purposes roster bonuses only count against the cap in the year they are paid so it does not count a prorated amount against the cap each year like a signing bonus. Usually teams then convert the roster bonus into a signing bonus the year it is due to then spread out its cap hit over multiple years. It lets a team lessen the cap hit in the first year or two. Just another way to fit a large signing and roster bonuses under the cap. Teams have to 'guarantee' the roster bonus or else a why would a player accept it over just a larger signing bonus.

The previous post is not entirely accurate, and that is kinda the point of this whole exercise. Bruce was not paid any remaining signing bonus upon his release...that money had already been paid to him. That's because the vast majority of signing bonuses (unless they are specified as split year bonuses) are paid in their entirety at the time the contract is signed. That's why they are considered guaranteed...you get the whole enchilada when you sign the contract. The yearly breakout of the signing bonus proration is just record keeping for tracking the salary cap. That money is already long gone from the checking account. This is contrasted with a roster bonus, which has traditionally NOT been guaranteed and requires you to still be on the team on a certain date in order to collect. This is clearly shown by the situation involving Bruce (and Gus Frerotte also mentioned in the same article) as well as many other players this year so far who were released by the roster deadline date instead of being paid the bonus. Unless Samuel's contract is breaking new ground, then this should be the case for him also and technically he is not guaranteed $20M, but actually$13M.

 

[GregR_2]

...

From my understanding, you have to be on the roster on the specified date or you don't get the money. ...

No, you don't necessarily have to be. It depends on the specific contract. You're treating it like it's a specifically detailed term based on the name. It isn't. It's just a bonus that will be paid at a future date, not tied to on the field performance (which would be an incentive). The details as to when the player will and will not get it is entirely up to the player and the team to agree on, and it doesn't just have to be tied to being on the roster, though normally that is part of it.Some of them the player has to make the roster. That would not be a guaranteed roster bonus. Bruce's is an example.

Others are partially guaranteed. Javon Walker has a roster bonus with the Raiders where he is guaranteed to receive it if he is on the roster or if he was released due to injury. Everyone still refers to it as a roster bonus even though he doesn't necessarily have to be on the roster, he just has to meet the terms of the contract.

Others may be fully guaranteed. I believe Vick's roster bonuses were, which was the basis for the NFL claiming they were of the same class as a signing bonus when it came time to deciding if he had to repay the money (which the courts didn't agree with, IIRC).