How much will Pennington cost next year?

[Kentucky Jet]

I have heard he will be very expensive and a huge hit against the cap. Does anyone know for sure? Thanks for your answers.

[Sperm Edwards]

I have heard he will be very expensive and a huge hit against the cap. Does anyone know for sure? Thanks for your answers.

His enormous cap # is actually this year b/c of reaching the playing incentives in 2006.

2008 cap #:

$3M pro-rated SB (2004)

$4.8M salary

------------------

$7.8M cap hit

This year it's enormous b/c of how he "took one for the team" and restructured. This year his cap # (as best I can tell) is:

$3M pro-rated SB (2004)

$2M salary

$2M roster bonus (March 2007)

$6M deferred ULTBE incentives reached for starting/playing 10 games in 2006

------------------

$13.0M cap hit

As best I can tell this is what it is anyway.

[Jetman_67]

I doubt he will be a Jet next year. with a dead shoulder he will be cut June 1 2008

[Kentucky Jet]

His enormous cap # is actually this year b/c of reaching the playing incentives in 2006.

2008 cap #:

$3M pro-rated SB (2004)

$4.8M salary

------------------

$7.8M cap hit

This year it's enormous b/c of how he "took one for the team" and restructured. This year his cap # (as best I can tell) is:

$3M pro-rated SB (2004)

$2M salary

$2M roster bonus (March 2007)

$6M deferred ULTBE incentives reached for starting/playing 10 games in 2006

------------------

$13.0M cap hit

As best I can tell this is what it is anyway.

Thanks. Now the question is: what do we do with him next year? Pay him? trade him? Cut him? Overpay him as our backup? Ask him to cut his pay dramatically? We do have a dilemma!

[Sperm Edwards]

If he does, I believe there is $6M left from his orig SB so he'd be $3M in dead cap for each year (I think but not 100% sure).

I think with a June 1 cut, you preserve the SB hit you would have taken anyway, subtract the salary that you're not going to pay, and then the rest of the SB that didn't come off yet comes off in one lump sum the following year. But since we're down to the last 2 years of his contract anyway, I think it just gets split in half like it would have if we kept him (minus the salary of course).

It doesn't have to be June 1 either anymore. I think he can be cut in March and we can defer the cap hit as though it were done after June 1. Makes sense that way anyway; if a team knows they're cutting a player & the player knows it, then it gives him 3 extra months to find a new team before everyone else has used up their cap space.

[Sperm Edwards]

Thanks. Now the question is: what do we do with him next year? Pay him? trade him? Cut him? Overpay him as our backup? Ask him to cut his pay dramatically? We do have a dilemma!

What you do is you start Clemens right now. Until Clemens gets half a season of game action you cannot know what to do. What if the 4th Q of the Baltimore game was the flukey part & the 1st 3 Q's are what he normally would play like? Personally I'd cut CP anyway & draft someone new (if he won't take a serious salary cut).

Look at it this way: what would it cost to get a different veteran backup player (not a Tui type veteran I mean)? $1.5-2M for one year? And then he has to learn the system, he's not going to be like an extra coach on the sideline, and is a generally bad QB anyway...I think if Chad loses the starting job & is willing to cut his salary down from $4.8M to even $2.8M he's worth keeping for 1 more year as a #2. Really it effectively costs us maybe $1M-$1.5M on a $115M cap to keep him as the #2 instead of a Trent Dilfer - Josh McCown - Kelly Holcomb type.

But we're not even there yet; let's see if Mangini ever benches him first.

[awats]

If he does, I believe there is $6M left from his orig SB so he'd be $3M in dead cap for each year (I think but not 100% sure).

I think with a June 1 cut, you preserve the SB hit you would have taken anyway, subtract the salary that you're not going to pay, and then the rest of the SB that didn't come off yet comes off in one lump sum the following year. But since we're down to the last 2 years of his contract anyway, I think it just gets split in half like it would have if we kept him (minus the salary of course).

It doesn't have to be June 1 either anymore. I think he can be cut in March and we can defer the cap hit as though it were done after June 1. Makes sense that way anyway; if a team knows they're cutting a player & the player knows it, then it gives him 3 extra months to find a new team before everyone else has used up their cap space.

I thought Pennington signed a seven year contract in 2004 which would leave four years on his contract? How is it that he only has two years left? Not complaining mind you; just curious.

[Sperm Edwards]

I thought Pennington signed a seven year contract in 2004 which would leave four years on his contract? How is it that he only has two years left? Not complaining mind you; just curious.

I believe that at the time, particularly with the then-current CBA contract running out, you could only spread a signing bonus cap hit over 6 years maximum.

So he received an $18M signing bonus in 2004. You take off $3M/yr for 6 years:

2004: $3M ($15M left to come off after the season's over)

2005: $3M ($12M left to come off after the season's over)

2006: $3M ($9M left to come off after the season's over)

2007: $3M ($6M left to come off after the season's over)

2008: $3M ($3M left to come off after the season's over)

2009: $3M (no money left to come off after the season's over)

2010: cap hit is only what his salary is. If he's cut before the season starts, there is zero cap hit in 2010 or after that.

Now he also received, from his original contract, a pair of roster bonuses ($3M in March of 2006 and $2M in March of 2007), for a total of $23M in bonus $ from his 2004 contract. Those count like salary; all of it counts against that year's cap. The way that differs from salary is that if you cut him after he cashes the check, it still counts against the cap; but salary doesn't officially count against the cap until it's guaranteed, which is like the week before the season begins.

He did renegotiate his contract before the 2006 season to drop his salary to like $600K. But he was due to make something like $7M in salary from his original contract (in addition to the $3M roster bonus). It was reworked so if he started 10 games (allegedly; no one knows 100% for sure) then he would get a lump bonus of $6M as an incentive. So he got that same amount in the end: $3M roster bonus + $7M in salary/incentive. Someone corrected me several months ago (maybe it was you) & I think he was right: because Chad didn't start 10 games the prior year (2005), that incentive was considered not likely to be earned (NLTBE) in 2006. Since it was considered unlikely he'd make that money, it didn't come off the 2006 cap. But then when he did earn that incentive bonus it had to come off the following year's cap.

That's why, in addition to his $2M roster bonus, $3M amortized amt of his signing bonus amount, and $2M salary, Pennington's cap # is effectively $13M this year instead of $7M. The cap relief we realized last year didn't go away; it merely got put off to 2007. I'm a little grey on whether he technically counts $13M on the cap instead of $7M, or if he does count $7M & we just have a $6M lower cap limit for this year, but that's really just semantics; the end result is identical.

(You may know all or most of this extra stuff I spewed out, but I thought I'd put it out there for others).