\

NFL Collective Bargaining Agreement

Appendix V
Compensatory Draft System


1. Commencing with 2020 free agency signing period, a Compensatory Free Agent (“CFA”) shall be defined as an Unrestricted Free Agent (“UFA”) who: (i) signed with a new Club during the prior free agency signing period (with the 2020 free agency period being the first such “prior free agency signing period” under this appendix) prior to 4:00 p.m., New York time, on the Monday following the NFL Draft for that League Year or whose rights were retained by the prior Club by sending the player the Unrestricted Free Agent tender prior to such time and date; and (ii) ranked within the top 35% of all League players in accordance with the provisions of Paragraph 2 below. Clubs that lose to other Clubs a greater number of CFAs than they sign or acquire from other Clubs shall be eligible to receive a Compensatory Draft Selection in the College Draft to be held in the following League Year subject to the provisions set forth below.

2. The following calculation, based on a player’s Average Yearly Compensation, honors and game participation, shall be used to determine a CFA’s ranking in percentage terms against all players on rosters at the conclusion of a regular season:

  1. All CFAs and all other League players on rosters at the conclusion of the regular season shall be ranked in ascending order by their Average Yearly Compensation, which shall be determined by dividing a player’s Gross Salary for all contract years by the contract’s Maximum Possible Term as defined in Paragraph 9 of this Appendix V. A player’s Gross Salary shall include: (a) signing bonus; (b) option bonus; (c) Paragraph 5 Salary; (d) roster bonus (including per-game bonuses, which shall count in full); and (e) reporting bonus regardless of whether such amounts are earned or considered “likely to be earned.” A player’s Gross Salary shall also include: (a) official performance incentives listed in Exhibits A, B and C of CBA Article 13; (b) salary escalators of any kind; and (c) bonuses within the player’s sole control (e.g., without limitation, offseason workout bonuses, and weight bonuses) that are earned by the player in the first League Year of the contract, or that are considered “likely to be earned,” either upon execution of the contract, or as the result of the year-end netting of incentives. For the purpose of determining a CFA’s ranking among all other League players on rosters at the conclusion of the regular season, players who signed Player Contracts for a prior League Year (i.e., prior to the League Year in which the CFA signed with the new Club), the above calculations shall be modified to include any of the above-listed bonuses, incentives or escalators that are earned by the player in such prior League Years, or that are considered “likely to be earned,” either upon execution of the contract, or as the result of the year-end netting of incentives. Subject to the above definition of Gross Salary, the player with the lowest Average Yearly Compensation shall be ranked first and thereby receive one point, with the second ranked player receiving two points.
  2. All players shall be assigned additional points based on honors or participation, as follows:
    1. Selected 1st Team ALL NFL by PFWA or 1st Team ALL PRO by AP: 20 points.
    2. Selected All Conference by PFWA (except if selected ALL NFL or ALL PRO above): 5 points.
    3. One point for each percent of the total offensive/defensive plays in which the player participated (excluding special teams) provided that the player participated in a minimum of 25% of the offensive/ defensive plays (excluding special teams). For example: 67% participation equals 67 points, 0% to 24.99% participation equals no points. Exception: in the case of punters and place-kickers, 1 point will be awarded for each punt attempted and 1 point for each punt inside the 20-yard line during the regular season for the punters, and 2 points for each field goal attempted and 1 point for each field goal made during the regular season for place-kickers.
  3. The sum of the numerical values in (a) and (b) above shall represent each player’s Final Numerical Value.
  4. Each CFA’s Final Numerical Value shall be measured in percentile terms against all players’ Final Numerical Values to determine the position of a Club’s Compensatory Draft Selection, if any.

3.

  1. Subject to Paragraph 5 below, only Clubs that have lost more CFAs than they have signed or acquired are eligible to receive Compensatory Draft Selections. The number of Compensatory Draft Selections shall be determined by the Club’s net loss of CFAs. If a Club qualifies for a Compensatory Draft Selection by virtue of sustaining a net loss, the position of each such selection shall be determined by offsetting each CFA lost by a Club (beginning with the highest ranked) by a CFA gained in an equal or higher percentile bracket. In each instance where a qualifying Club has lost a CFA and has not gained a corresponding CFA in an equal or higher percentile bracket, the Club shall receive a Compensatory Draft Selection in the Draft round specified under Paragraph 3(b) below. This procedure shall continue until a Club has been awarded Compensatory Draft Selections equal to the net number of CFAs lost. In no event may a Club receive more than four (4) Compensatory Draft Selections in any one year. If a Club qualifies for more than four Compensatory Draft Selections only the four highest selections will be awarded to the Club. If a Club trades for a player who was a CFA during that League Year, whether the player was another Club’s CFA or the —401— acquiring Club’s own CFA, the player will be considered a CFA gained by the acquiring Club and will be included in the Compensatory netting process described above.
  2. The Draft round of a Compensatory Draft Selection shall be determined by a CFA’s percentile ranking pursuant to 2(d) above and the following provisions:
    1. Clubs that lost a CFA within the top 5% of all League players shall receive a Compensatory Draft Selection following the last selection in the third round of the College Draft.
    2. Clubs that lost a CFA below the top 5% and within the top 10% shall receive a Compensatory Draft Selection following the last selection in the fourth round of the College Draft.
    3. Clubs that lost a CFA below the top 10% and within the top 15% shall receive a Compensatory Draft Selection following the last selection in the fifth round of the College Draft.
    4. Clubs that lost a CFA below the top 15% and within the top 25% shall receive a Compensatory Draft Selection following the last selection in the sixth round of the College Draft.
    5. Clubs that lost a CFA below the top 25% and within the top 35% shall receive a Compensatory Draft Selection following the last selection in the seventh round of the College Draft.

4. Notwithstanding the provisions of Paragraph 3(b) above, no Club shall be entitled to a Compensatory Draft Selection before the end of the fifth round for any CFA (excluding quarterbacks) with ten or more Accrued Seasons at the time of signing with his new Club.

5. Notwithstanding Paragraph 3(a) above, if a Club loses the same number of CFAs as it signs or acquires, it will receive a Compensatory Draft Selection if the sum of the Final Numerical Values of all CFAs lost is more than 300 points greater than the sum of the Final Numerical Values of all CFAs signed or acquired by the Club. Any such selection shall occur after all Compensatory Draft Selections at the end of the seventh round have been exercised, but prior to the exercise of any Supplemental Selections under Article 6, Subsection 2(a).

6. If a Club designates a Transition Player or Franchise Player who receives an Offer Sheet, and the designating Club declines to match, the designated player is not a compensable Free Agent. Notwithstanding the immediately preceding sentence: (i) if the designating Club declines to match an Offer Sheet to its designated Franchise Player, the Club shall be entitled to Draft Choice Compensation of two first round selections in the event the player signs with the New Club, as provided in Article 10, Section 2(a)(i); and (ii) if the designating Club declines to match an Offer Sheet to its designated Transition Player, no Draft Choice Compensation shall be made with respect to such player, as provided in Article 10, Section 5.

7. If a Club designates a Transition Player or Franchise Player but withdraws its Tender before the designated player receives an Offer Sheet, and another Club subsequently signs that player, the player shall be a compensable Free Agent if all other requirements are satisfied.

8. No UFA shall qualify as a CFA unless and until the maximum possible term of the player’s contract (“Maximum Possible Term”) has expired, and all other requirements have been satisfied. The Maximum Possible Term of any Player Contract shall be determined as of the date of such contract’s execution and shall include all years of the contract (including, without limitation, option years and voidable years). Notwithstanding the foregoing, a UFA shall qualify as a CFA if the Maximum Possible Term of the player’s contract failed to expire solely as the result of a provision stating that a specified contract year or years shall void automatically upon a specified day or date or upon the achievement of a roster condition with no additional contingencies (“Automatic Voidable Year”), unless the expired contract is a renegotiated contract that included a new or earlier Automatic Voidable Year within the Maximum Possible Term of the player’s prior contract and such void occurred. For the avoidance of doubt, no UFA shall qualify as a CFA if the Maximum Possible Term of the player’s contract is reduced as the result of the player’s or the Club’s decision to exercise, or not to exercise, any contractual rights, whether individually or in combination. No UFA shall qualify as a CFA if the player’s NFL Player Contract is renegotiated to reduce the Maximum Possible Term of the contract. Notwithstanding anything to the contrary in this Paragraph 9, in the event a Club elects not to exercise a Fifth-Year Option under Article 7, Section 7, nothing in Article 6 or this Appendix shall operate to preclude the player from qualifying as a CFA upon expiration of the fourth year of his Rookie Contract if all other requirements are satisfied.

9. In accordance with NFL Player Personnel Rules, if a Club places a player on Reserve/ Injured with a “minor” injury, the player must be placed on No Recall waivers (or terminated if he has four or more pension-credited seasons at the conclusion of the previous season) as soon as, in the judgment of the Club, he is physically able to practice or play football. If the Club has not waived or terminated the player’s contract as required by this rule because the player has yet to pass the Club’s physical examination, with the result that the player’s contract expires, the player will not qualify as a compensable Free Agent.

10. Notwithstanding anything to the contrary in Article 6 or this Appendix, a UFA who signs a Veteran Salary Benefit (formerly “Minimum Salary Benefit”) Contract, pursuant to Article 27, Section 2 of this Agreement shall not be a CFA.

11. Notwithstanding anything to the contrary in Article 6 or this Appendix, a UFA who signs a one-year NFL Player Contract that provides for a maximum of $1.75 million shall not be a CFA (an “Excluded UFA”); provided, however, the signing Club must notify the NFL Management Council upon execution of such Player Contract that the player is being designated as an Excluded UFA pursuant to Article 6 and Appendix V of the CBA, which designation cannot be modified or withdrawn by the Club. The abovestated maximum ($1.75 million) shall apply to the 2020 and 2021 League Years and thereafter shall increase by $20,000 on a bi-annual basis (e.g., the maximum during the 2022- 2023 League Years shall be $1.77 million). The one-year contract of an Excluded UFA cannot be renegotiated or extended until after the Club’s final game.