Per multiple sources the 49ers will trade 2012 first round draft pick WR AJ Jenkins to the Kansas City Chiefs. Jenkins has been a major disappointment for the WR depleted 49ers and they were considering releasing Jenkins despite the fact that they owe him guaranteed salary if someone failed to pick up his contract when placed on waivers.
The benefit of trading Jenkins is that the future guaranteed Paragraph 5 salary transfers to the team that trades for the player. That saves the 49ers from potentially having to pay Jenkins $1,727,391 after having cut him from the team. Jenkins did have offsets in his contract, but had he cleared waivers a team could sign him for the minimum salary of $480,000 and $570,000 over the next two seasons leaving the 49ers with more money owed and hurting their short term salary cap as they wait for credits to be applied.
The 49ers will have a dead money cap charges of $873,187 in 2013 and $1,746,374 in 2014 attributed to Jenkins. The Chiefs will take on cap charges of $705,797, $1,021,594, and $1,337,390 from 2013 thru 2015, the first two years of which are fully guaranteed. This trade also illustrates the team benefits of the new CBA as a trade under the prior CBA would have been difficult as the 49ers would have likely paid Jenkins a salary advance or option bonus in March and reduced his base salaries to the minimum. The cap charge associated with such a trade would have been too high for the 49ers to absorb.
After writing this I just saw that the terms of the trade included WR Jon Baldwin going to the 49ers. Baldwin had a fully guaranteed salary of $1,061,510 that now transfers to the 49ers. Next year Baldwin will carry a cap charge of $1,404,765 for San Francisco, none of which is guaranteed. His dead money charge for the Chiefs will be $998,018 in both 2013 and 2014.This was a necessity for Kansas City as they could not absorb the salary cap impact of Jenkins’ contract without moving other players. Kansas City only has around $7,500 in cap room, not enough to trade a conditional pick for Jenkins salary. The trade in essence becomes a financial swap of disappointing first round players that provides the short term needs for the Chiefs and long term needs of the 49ers.
The trade works out to be a financial benefit for both sides. The 49ers will save themselves around $665,000 in guaranteed salary and remove any future guarantees from the books in 2014, when their salary cap looks to be quite tight. The cap starved Chiefs will receive an immediate cap benefit of about $355,000 in return for taking on guaranteed salary in 2014. So it’s a benefit for both sides that, at the very least, makes sense from a financial perspective even if both sides feel there is little to gain from the players involved.