Panthers Converted OT Matt Kalil's $10M Option Bonus Into A Signing Bonus Guaranteeing He'll Be On Roster In 2018

[AggieLean]

2 hours ago, Jon Snow said:

That's not how it is at all.  Maybe you should read it again.

How is it, Bogart?

[falconidae]

3 hours ago, Mr. Scot said:

We went from this...

...to this.

Everybody knew Kalil was here for 2018.  Now he's guaranteed to be here for at least one more season beyond that.

I'd like to see a better rationale for that than just "well, we can get some money back if he retires".

So hard to get good figures and details on these contracts. I think what's throwing you is that you think an option bonus isn't guaranteed while a signing bonus is. And, in this case, that's just not necessarily so.

Earliest reports of the deal had an 11 mil guaranteed salary for year two.  I think what happened is, when that 10 mil  salary converted to a bonus, the guarantee remained. If that's so, then everything makes sense, Hurney's hands were tied , Kalil was never getting cut after 2018, because another 10 mil in guaranteed money was going to hit in 2018- and Sportrac was just wrong about the  possible  cut after 2018.

[heel31ok]

10 hours ago, Mr. Scot said:

All indications so far are that this benefits Matt Kalil but not the Panthers.

Why do that?

Well, we know that a certain owner recently helped guarantee that Ron Rivera and Marty Hurney were going to get paid no matter what happened with the team's ownership.

Could he now be looking to ensure that some of his favorite players also get a little extra cash?

Oy...

I'm hoping this is an isolated incident or that some sort of rationale will be uncovered soon. Because if not, it occurs to me that Jerry Richardson could definitely do some damage to our cap if he decided to give out a few "parting gifts".

And obviously, it would help to have a GM in place who would have no trouble agreeing to such actions.

Lol...bull crap

[top dawg]

Basically, it was a terrible contract that ironically pretty much tied Hurney's hands for the next couple of years, unless he was willing to take it all on the chin this year, and lessen our ability to make moves this offseason pretty markedly (if I understand correctly).

[AU-panther]

3 hours ago, Mr. Scot said:

We already knew he'd be here this season.  Not having the out to cut him after this year is something I can't see as a positive.

Regardless, these decisions are gonna be getting made by someone different next year anyway.

Nothing that happened today changes the cost of cutting him after next year.

Either you have to use cap space for salary this year or cap space for dead money next.  If you don't exercise the option then his cap hit this year is larger.

 

If you cut him after two year and exercise the option:

Signing bonus - $12m

2017 salary: $1m

2018 bonus - $10m

2018 salary - $1m

2018 workout and roster bonus -$1m

Total - $25m

 

If you cut him after two year and don't exercise the option:

Signing bonus - $12m

2017 salary: $1m

2018 bonus - 

2018 salary - $11m

2018 workout and roster bonus -$1m

Total - $25m

Same total

 

The accounting changes between the two because bonuses are prorated.

 

exercising the option

2017 cap hit                                3.4m

2018 cap hit                                6.9m

2019 cap hit (dead money)     14.7m

Total 25m

 

not exercising the option

2017 cap hit                                3.4m

2018 cap hit                                14.4m

2019 cap hit (dead money)      7.2m

Total 25m

Yes, you will have more dead money in 2019 but you will have the more cap space because you spent less in 2018.

Either way you can't really blame Hurney for any of this.  Simply put Kalil received a really nice contract.

 

Best way to look at is his total cost for x years of service:

If he plays for 2 years his total cap cost is $25.

If he plays for 3 years his total cap cost is $33m.

Disclaimer:

I'm far from an expert and for whatever reason Kalil's contract seems a little more confusing then most.  Also there seems to be some varience on what people report about it.  Most of my info I get from overthecap.com and spotrac.com.

 

 

 

 

 

 

[Mr. Scot]

Just now, AU-panther said:

Disclaimer:

I'm far from an expert and for whatever reason Kalil's contract seems a little more confusing then most.  Also there seems to be some varience on what people report about it.  Most of my info I get from overthecap.com and spotrac.com.

Spotrac were the ones that said it increases his dead money for next season and makes it difficult to cut him.

I don't claim to be a cap guru either but that was their report, along with saying it benefited the team "zilch".

Like I said earlier, at this point, I just wanna see how he does this year.  If he plays well, I won't care about any of this.  If he doesn't, that's gonna suck.

[RealisticPanther]

I think everything else Gettleman did is forgiveable enough and you could still make an argument he's an alright or even good GM, but this..Gettleman is a piece of S#!+

[AU-panther]

5 minutes ago, Mr. Scot said:

Spotrac were the ones that said it increases his dead money for next season and makes it difficult to cut him.

I don't claim to be a cap guru either but that was their report, along with saying it benefited the team "zilch".

Like I said earlier, at this point, I just wanna see how he does this year.  If he plays well, I won't care about any of this.  If he doesn't, that's gonna suck.

It would increase his dead money.  At this this point next year we would all be talking about how much dead money he would have but we would be forgetting that we paid 10m less this year.  I think they are referring to next year in a vacuum and not looking at the entire picture, but I could be wrong.

[Mr. Scot]

2 minutes ago, AU-panther said:

It would increase his dead money.  At this this point next year we would all be talking about how much dead money he would have but we would be forgetting that we paid 10m less this year.  I think they are referring to next year in a vacuum and not looking at the entire picture, but I could be wrong.

None of us knows the full language of it. Who can say?

But ultimately, like I said, at this point, all I care about is whether he's good next year or not. 

Seeing as he's gonna be here a while, I sure hope to hell he is.

[top dawg]

On 1/24/2018 at 1:59 PM, Toomers said:

   Jeremy needs to pin this to the top of the board so people will stop using term “out” or “escape” when referring to Matt Kalil’s contract.

 

 Matt Kalil will cost 14.7M dead money if we cut him AFTER this season. That’s not an escape, it’s a brick to the back of the head. 

  

As I said the minute he signed.....”This is a dark day in Panthers history”.

I knew I remembered someone saying this. At that price, we almost had to keep him anyway. @Toomers sounds like he has a better grasp than most on this thing. 

[grimesgoat]

Ok, I think we all understand the Kalil Contract a little better, but maybe I can summarize...

2017 - Matt signs his contract.  His cap hit is 3.6m. 

Note: we ended up carrying over 2m. in cap this year.  That is not very much.  We did not have a lot of extra room to play with.  The contract for Matt had to be set up in a way that carried a low cap hit in year 1.  For example, had he signed a contract with a signing bonus of 22m instead of 12m, we would have exceeded the cap last year.  That's why the 10m was a deferred option bonus.

2018 - we have 3 options (keep in mind we have about 12m in cap room prior to cutting Johnson and Coleman).

Cut Matt - cap hit=19.6m

Don't exercise option - cap hit=14.4m

Exercise option - cap hit=6.7.

To me its a no brainer - we simply do not have the cap space to do anything but exercise the option.

2019 - we will have 2 options

Cut Matt - cap hit=14.7

Keep Matt - cap hit=12.9

If he is absolutely worthless, it will cost as much to keep him as to cut him.  We may be able to spread the hit over 2 years, not sure.

Bottom line - the contract was borne of necessity. We really did not have a lot of room to play with if we wanted Munnerlyn, Peppers, Turner, etc.  This is why we couldn't pursue Ginn.  Then we have Olsen and TD whining about getting paid.

[AU-panther]

1 hour ago, grimesgoat said:

Ok, I think we all understand the Kalil Contract a little better, but maybe I can summarize...

2017 - Matt signs his contract.  His cap hit is 3.6m. 

Note: we ended up carrying over 2m. in cap this year.  That is not very much.  We did not have a lot of extra room to play with.  The contract for Matt had to be set up in a way that carried a low cap hit in year 1.  For example, had he signed a contract with a signing bonus of 22m instead of 12m, we would have exceeded the cap last year.  That's why the 10m was a deferred option bonus.

2018 - we have 3 options (keep in mind we have about 12m in cap room prior to cutting Johnson and Coleman).

Cut Matt - cap hit=19.6m

Don't exercise option - cap hit=14.4m

Exercise option - cap hit=6.7.

To me its a no brainer - we simply do not have the cap space to do anything but exercise the option.

2019 - we will have 2 options

Cut Matt - cap hit=14.7

Keep Matt - cap hit=12.9

If he is absolutely worthless, it will cost as much to keep him as to cut him.  We may be able to spread the hit over 2 years, not sure.

Bottom line - the contract was borne of necessity. We really did not have a lot of room to play with if we wanted Munnerlyn, Peppers, Turner, etc.  This is why we couldn't pursue Ginn.  Then we have Olsen and TD whining about getting paid.

We could always do a June 1st cut next year.  It won't reduce his cap hit but it would spread it out.

Instead of $14.7m in dead money you would have $4.9, but then you would have $9.8 in 2020.

So instead of a 2019 cap hit of $12.9m his cap hit would be $4.9m for a savings of $8m relative to what he would have made.  In 2020 his cap hit of $15.9m would become $9.8m so a savings of $6.1m relative to what he would have made by playing.  This is how teams justify letting players go and carrying large amounts of dead money on the books.  

There is nothing you can do about the dead money so you have to look at how it effects you now.  Can you replace Kalil's production in 2019 and 2020 for $14.1m?

This is the problem with big free agent contracts.  At best you end up paying a player what they are worth.  At worst you end up grossly overpaying.  You really need to get it right and that is what surprised me when the contract was first announced, his history suggested it was a gamble.