RT Anthony Davis signed a 5 year extension with the San Francisco 49’ers worth about $33 million in new money. Matt Maiocco put the contract numbers out today which allowed us at OTC to come up with an estimate on the structure of the contract. While not perfect in terms of cap I am pretty confident in the cash flows of the contract. With Davis agreeing to the extension I think we now have a comparable player for Andre Smith, one of the few remaining “name” players on the free agent market.
Smith is a former top draft pick, selected 6th overall in the 2009 NFL draft by the Cincinnati Bengals. Davis was selected 11th in 2010. Both players had (and still have) red flags about weight and dedication to the sport. Davis will be 24 years old this year and 26 when his extension kicks in. Smith is 26 now. In general the two players grade out as two of the best three right tackles in the NFL. Smith was reportedly looking for $9 million a year, which we knew he had no chance of ever seeing but with the market crash the question would be just how far he might fall. Now we probably have an answer.
Davis will earn $6,640,280 per year under his new 5 year deal. Because this is an extension there are a number of ways to look at the values of the contract. Using simply a new money valuation the cash flows of the contract would look at follows:
As is typical for many contracts, the deal contains “rolling” guarantees where Davis must be on the roster on a certain date (which is a very team friendly April 1st, typical for the 49’ers) to earn his full guarantee. Based on the cap damage of a release due to the prorations from his existing contract and the new prorations from a $7.5 million signing bonus received with the extension I would consider 2014 and 2015 to be functionally guaranteed, though I could see an argument against the 2015 year. With that in mind the guarantee of the contract is around $15.879 million.
In addition, as Maiocco explains, Davis has a large amount of base salary tied into offseason workout participation and maintenance of his weight. He stands to lose $1.25 million per year if he fails to meet his weight during the year and skips voluntary workouts, reducing his total takehome to $26,951,400 if he fails to perform. While we are uncertain of the yearly bonus structure of the contract (I have estimated $1 million per year in roster bonuses) it is worth noting that the 49’ers are notorious for tying yearly bonuses to games active. Davis’ rookie contract called for significant bonuses that were tied to games active and it would not be surprising to see him earn around $62,500 for each game active. Essentially it is a play for performance contract.
Considering the similarities between Smith and Davis this is likely the model that Smith will be working from. Now the Bengals have more cap space than San Francisco and follow a different cap philosophy, but in general the cash flows, guarantees, and built in protections should be similar. Smith can try to push for more potential money to match the $7 million per year earned by Gosder Cherilus, but a good portion of Cherilus’ contract is backloaded money anyway. Here is the cash flow component of Cherilus’ contract:
Those first three years are very similar to the Davis deal with more money coming to Cherilus in year 1. Unlike Davis’ contract I would consider $20.5 million functionally guaranteed to Cherilus, though in part that is because Davis loses dead money protection by signing early. Smith’s functional guarantee should fall somewhere in between the two players. Based on the Davis deal you could argue that about 37% of the value is tied to health and workouts which will clearly be a part of the Smith contract.
Because the Bengals have so much cap room they can be more creative with Smith than the 49’ers were with Davis. The Bengals seem to like using a combination of a 1st year roster bonus along with a signing bonus and I would expect them to do something along those lines here. If Smith was more reliable they could frontload the contract, but with all the protection needed I can’t see that happening. They also need to set aside money to re-sign Geno Atkins either this year or next season. There have been some people talking about extending WR AJ Green after the 2013 season but with the WR market still vibrant there is no need to do that as the Bengals control his rights through the 2015 season at a very reasonable cost.
Back to Smith…I think its clear that the market has now been set. Realistically he is looking at around $20 million or so over 3 years of which I’d guess $5 million may be tied to weight, offseason participation, and general health. He could max out as high as $35 million but more likely will come in a shade under $34 million. At that price, a very similar price to his rookie contract, it would seem to be a no-brainer for the Bengals to get the deal done and keep him as part of a young nucleus that has potential to win the division in 2013.