How much Seahawks can save by restructuring/extending key players

Let’s go through how restructuring/extension work and the dangers of using this method to create cap relief.

Truth is, players would do a classic restructure 10/10. A classic restructuring of the contract converts some portion of the base salary into a signing bonus. The signing bonus is then prorated over the life of the contract.

Base salary is where teams control how the cap hits are spread. The signing bonus is equally spread over the life of the contract ($5 million signing bonus /2 years is $2.5 million per year). The cap hit is the summation of the base salary and signing bonuses. The dead money is the total of the signing bonus from that season and any season going forward.

Example: Player A contract: 2 years, 20 million with 5 million in signing bonus.

Year:    Base salary:    Signing Bonus:   Cap hit:   Dead Money:

2021           $6m                     $2.5m           $8.5m          $5m

2022           $9m                     $2.5m           $11.5m        $2.5m

***Note: there are other types of bonuses: workout bonus, roster bonus, and incentives bonus’s to name a few. More or less, these are incentive deals. You work out on 70% of the days you get the workout bonus. You play in 70% of games you get the incentive bonus. A roster bonus means you are on the roster as of XXX day. 70% is just a random number to showcase how it works. 

Example: Player A restructures: The team restructures $4 million of the contract.

Year:    Base salary:    Signing Bonus:   Cap hit:   Dead Money:

2021           $2m                     $4.5m           $6.5m          $9m

2022           $9m                     $4.5m           $13.5m        $4.5m

What changed:

• The 2021 base salary dropped $4 million. This is the $4 million restructured.
• The 2021 and 2022 signing bonus both increased by $2 million ($4m spread over the life of the contract)
• Cap hit for 2021 decreased by $2 (less $4 million in base + $2 million in signing bonus) million. Cap hit for 2022 increased by $2 million.
• The dead money in 2021 increased by $4 million and $2 million in 2022.

Players receive more money today, more job security (guaranteed money/dead cap on contract), and help the team lower the current year’s cap hit. Teams don’t typically like to do this because it increases the cost to move on from the player (guaranteed money/dead cap) if the contract is worth more than the player’s on-field production. It can also put teams in a pickle down the road if many players are restructured. Just look at the Saints and Eagles.

The other type of restructuring is forcing a player to take less money. This is a dangerous move and can really hurt the chemistry of a locker room. Just imagine if your boss came in and demanded you to take less money to do the same job. It is a dangerous chemistry move that can affect the entire locker room. Not just those who were forced to take a cut.

One final thing, the cap figures were provided by Over The Cap. The site is a great resource and free to use.

Without further ado, let’s go into what the team can save by restructuring and extending 8 key player’s contracts.