NFL Collective Bargaining Agreement

Article 13
Salary Cap Accounting Rules

Section 7
30% Rules

(a)

No NFL Player Contract extending into a season beyond the Final League Year may provide for an annual increase in Salary, excluding any amount attributable to a signing bonus as defined in Section 6(b)(iii) above, of more than 30% of the Salary provided for in the Final League Year, per year, either in the season after the Final League Year or in any subsequent season covered by the Player Contract. The 30% Rule set forth in this paragraph shall not apply to any Rookie Contract referred to in Article 7 of this Agreement, including without limitation, with respect to Rookie Salary, the Proven Performance Escalator described in Article 7, Section 4; the Performance Incentive described in Article 7, Section 6; and the Fifth-Year Option for First Round Selections described in Article 7, Section 7. Notwithstanding the preceding sentence, the 30% Rule set forth in this paragraph shall apply to any renegotiated or extended Player Contract that is permissible under Article 7, Section 3(k) and that such Player Contract shall not be subject to the rules that limit Rookie Contracts.

(b)

Any amount which a Club may pay to a player to buy out a right the player has or may have to terminate one or more contract years shall be treated as signing bonus at the time the buyout is exercised by the Club, and prorated at that time over the remaining term of the contract, including the current League Year, if the right to terminate and/or the right to buyout is based upon one or more incentives that are not “likely to be earned.” Such a buyout amount shall not be included in any calculation for purposes of the 30% Rule, set forth above. (The parties acknowledge a disagreement as to the treatment of allocated signing bonus and buyout payments when a player’s right to terminate one or more contract years and/or the Club’s right to buyout is based upon one or more incentives that are “likely to be earned,” and not upon any incentives that are not “likely to be earned.” These issues are expressly left open. Except to enforce the terms of this Subsection (b), the terms of this Subsection may not be referred to or used by any of the parties in any proceeding, or otherwise, and the parties otherwise reserve all their rights with respect to the subject of this parenthetical.).

(c)

Any amount specified to be paid for the exercise of an option by a Club to extend the term of a Player Contract shall be treated as signing bonus, prorated over the remaining term of the contract commencing in the League Year in which it is exercised or the last League Year in which the option may be exercised, whichever comes first. Such an option amount shall, immediately upon execution of the contract, renegotiation or extension, be included in any calculation for purposes of the 30% Rule, set forth above, prorated over the remaining term of the contract commencing in the last League Year in which the option may be exercised. Notwithstanding the foregoing: (i) if a Club renounces its right to exercise the option, the option amount shall not be included in Team Salary as of the date of such renunciation; and (ii) if the club does not renounce, but nonetheless does not exercise the option, the full amount of the option amount previously counted against Team Salary shall be credited to the Club’s Team Salary in the next League Year.