Tom Brady Restructures Contract - shifts $24 million

[Danger Zone]

Again, I'm not going to argue this, and I'm not saying anything about the intelligence of making the deal. The terms are the terms. Assuming we know everything that was changed in the agreement, Brady is more easily cut. Brady is not more difficult to trade. Brady has $24 million dollars which is no longer fully guaranteed, and the Brady payout in return is $3 million.

So, again, according to what we know now, Brady has put $24 million at risk for the sake of an extra $3 million.

See, you keep saying that last part like it was his motivation to make this deal. Stop making that statement in that way and your "I'm not going to argue this" predicament goes away.

 

[mosi's man]

So as I understand it this move apparently makes little sense for either the Pats or Brady:

- The Pats don't have to put $24M into escrow, but it's not clear why that would truly be important to them; they add $1M of additional cap space in each of the next 3 years, and cap space is tight for 2015; and they make it easier to trade or cut Brady, which doesn't really seem like something they would want to do next year.

- Brady gets $3M extra, which isn't a lot of money for him; he makes it easier for the team to trade him, which doesn't make a lot of sense; and he loses the written guarantee of $24M for skill

There are only a couple of scenarios which make sense of this for me:

1. The Pats and Brady have agreed to amicably part ways in the near future, and are making it easier for each other. I find this very hard to believe.

2. The Pats and Brady are VERY secure about the next 3 years together and the team wants a VERY large chunk of cash immediately available to make an aggressive up front play for someone, with Revis the overwhelmingly obvious candidate. They are willing to raise Brady's cap hit by $1M because they will recoup much, much more than that in lowering Revis' cap hit with a long term extension.

Am I missing something?

I'm still confused. While I agree with the above, questions remain:

1. Bob Kraft really needs the financial flexibility that this provides? Really, billionaire Bob can't offer Revis (and Jones, McCourty, etc.) a big signing bonus without freeing up the 24 million in escrow? Honest? Frankly hard to believe.

2. The Pats just raised their salary cap (albeit by a small amount) to make it easier to fit all their players under the cap for next year? A weird solution....

3. The Pats might want to release Brady, who presently might garner somewhere on the order of a first and second round choice in a trade? No way BB parts with such an asset for nothing in return.

4. Brady wants to retire despite continuing to play at a high lever while reiterating again and again that he wants to continue playing for as long as possible?

5. Brady was willing to make this change for an extra million a year?

None of the above makes much sense to me. Of the two options you describe, I actually think #2 makes more sense although it's frankly hard to believe. Otherwise, the move seems to have been made to the detriment to the cap but so that Kraft can access money more easily, which would be very hard to understand given the value of the Pats and his personal fortune. It's fascinating, and I look forward to hearing a better explanation in the coming weeks.

 

[PP2]

There is no chance that the Pats will get rid of Brady in 2015 AND get nothing (draft picks or players) in return.

Except that I think that is exactly the condition (perhaps unspoken) that Yee asked for in exchange in releasing the skill guarantee, that if the Patriots feel they want to move on from Brady, he will be allowed to become an UFA, immediately. That's honorable, and a recognition of what Brady has done for this team.

 

[mosi's man]

BB is the greatest coach of all time, and I think, a fantastic GM. During his tenure, many adjectives have been used to describe his behavior. I'm not sure "honorable" is at the top of the list, however. What has made him and the Pats so successful has been his single minded commitment to winning. During his tenure, nothing else has mattered. I can't believe that, in exchange for getting 16-24 million dollars out of escrow, that BB would be willing to freely part with an asset as valuable as Brady for nothing. If he did, as a Pats fan, I'd be pissed and it would be remarkably inconsistent with his behavior to date.

Additionally, if the Krafts have increased the Pats salary cap for next year in exchange for the difference in the interest rate on 24 million, then maybe the Felgers of the world have a point and money does in fact limit the Pats commitment to winning. Kraft has an estimated net worth of 2.3 billion. If he needs that 24 mill out of escrow so badly so that he can put the team in the best position to win then we have a real problem.

Additionally, if Kraft went to Brady and, in exchange for a guarantee to essentially honor his original deal (or allow him to become a true free agent), made changes solely to free up money in escrow while extracting another million against the cap, then the "Brady is selfless" meme takes a little bit of a hit.

 

[BradyManny]

As I just posted in Miguel's explanation thread, and based only on what we know so far, Brady is essentially risking the loss of up to $24 million that had been guaranteed, in return for an extra $3 million.

I would think one way to look at it would be: Brady giving Bob Kraft a $24 million loan, with Kraft effectively paying $3 million in interest over 3 years on that loan.

 

[mayoclinic]

Except that I think that is exactly the condition (perhaps unspoken) that Yee asked for in exchange in releasing the skill guarantee, that if the Patriots feel they want to move on from Brady, he will be allowed to become an UFA, immediately. That's honorable, and a recognition of what Brady has done for this team.

Isn't there a rule that allows veteran players with 10 years of experience and 5 or more with the same team to veto a trade? I'm pretty sure there used to be such a provision. Not sure it still exists under the new CBA. Part of this could be giving the Pats and Brady the ability to move on from each other down the road. Either the Pats would work out a trade that met with Brady's approval, or trade him. In either scenario, the cost to move on would be less prohibitive.

 

[Oswlek]

1. Bob Kraft really needs the financial flexibility that this provides? Really, billionaire Bob can't offer Revis (and Jones, McCourty, etc.) a big signing bonus without freeing up the 24 million in escrow? Honest? Frankly hard to believe.

I see this a lot and it doesn't strike me as being so hard to believe as it is for everyone else. Football teams are virtually guaranteed wealth developers, but they aren't nearly as revenue friendly as one would assume (at least, that was the case when I saw some numbers 7 or 8 years ago. I suppose things might have changed since then). Kraft also has other businesses which may be impacting his cash flow position.

Of course, you have to think Kraft could walk into any bank and they would jump at the chance to give him some money, but why borrow when you have other options?

Most importantly, though, it isn't just $24mm. It's Brady's money + Revis' signing bonus + McCourty.... that right there is $50mm and we haven't gotten to Solder or Vereen or perhaps early extensions for CJ/HT or the draft picks or those players' replacements and on down the line. It's not unthinkable the cash outflow would end up being over $80mm so cutting a third of it off the top is a big deal.

Or not. Maybe I'm totally off base.

 

[mosi's man]

Oswlek, your assumption certainly makes the most sense. However, if this move was done so that Bob Kraft can more easily afford the necessary cash required to keep the Pats as competitive as they can be, I'll be very disappointed. We're likely, at worst, talking about the interest payments on 24 million, not the actual money itself. It's all weird and I'm looking forward to a more complete explanation.

 

[BradyManny]

So not much changed regarding trading Brady. Nonetheless, here it is.

June 2nd, 2016 (can be traded before this date with same result. Credit to ctpatsfan77):

39 year old Tom Brady vs. 3rd year Jimmy Garoppolo + 9 million cap space + draft pick(s) from a Brady trade

If Jimmy G pans out, that's a legitimate decision to be made.

The thing people are forgetting in the Jimmy G discussion is that the guy's contract is up the year Brady's is. The notion that Garoppolo is here for another twenty years is some pipe-dream based purely on what has happened with Brady. The set of circumstances that leads to him staying here indefinitely are fairly small especially given the way the rest of the league seemingly finds our 2nd string QBs more valuable than we do. He would have to play very well to the point the Patriots are comfortable paying him as an elite QB and still be team-friendly a la Brady. If he's just pretty good, odds are some team like the Texans or Browns, or whoever is still QB hungry at the time, would be willing to pay him considerably more handsomely than the Patriots would. If he's not that good, the Patriots move on anyway. If Belichick is already planning on Jimmy G's second contract, he's like a 17 year old planning marriage after a first date.

I don't think Belichick thinks as far ahead as people think he does - because it's not prudent. Belichick has clearly set a value on what he is willing to spend on a backup QB - a 2nd or 3rd rounder on a rookie contract. So far, that's exactly what Jimmy G is.

 

[Oswlek]

He would have to play very well to the point the Patriots are comfortable paying him as an elite QB and still be team-friendly a la Brady. If he's just pretty good, odds are some team like the Texans or Browns, or whoever is still QB hungry at the time, would be willing to pay him considerably more handsomely than the Patriots would. If he's not that good, the Patriots move on anyway. If Belichick is already planning on Jimmy G's second contract, he's like a 17 year old planning marriage after a first date.

I have to disagree with all of these points. Neither Mallett nor Hoyer was in high demand, in fact, Brian was entirely out of job for a while. Cassel got a nice contract from KC, but that was from a former GM with a full year of performance on his resume. No one is going to pay JG a big contract based solely on preseason performance, so if Bill feels Jimmy is worth retaining, NE could be the highest bidder and still have a reasonably low cost starter at QB.

The last sentence makes no sense to me. Of course the Patriots have thought about how they would go about moving on from Brady, with JG's second contract being one of the possible scenarios. Any less is just bad business.

 

[PP2]

I see this a lot and it doesn't strike me as being so hard to believe as it is for everyone else. Football teams are virtually guaranteed wealth developers, but they aren't nearly as revenue friendly as one would assume (at least, that was the case when I saw some numbers 7 or 8 years ago. I suppose things might have changed since then). Kraft also has other businesses which may be impacting his cash flow position.

Of course, you have to think Kraft could walk into any bank and they would jump at the chance to give him some money, but why borrow when you have other options?

Most importantly, though, it isn't just $24mm. It's Brady's money + Revis' signing bonus + McCourty.... that right there is $50mm and we haven't gotten to Solder or Vereen or perhaps early extensions for CJ/HT or the draft picks or those players' replacements and on down the line. It's not unthinkable the cash outflow would end up being over $80mm so cutting a third of it off the top is a big deal.

Or not. Maybe I'm totally off base.

Don't think so- billionaires don't get to be billionaires (and millionaires to a lesser degree) by spending foolishly.

 

[RobertWeathers]

I don't think Belichick thinks as far ahead as people think he does - because it's not prudent. Belichick has clearly set a value on what he is willing to spend on a backup QB - a 2nd or 3rd rounder on a rookie contract. So far, that's exactly what Jimmy G is.

Agreed but I do think when it comes to structuring contract length/money as it pertains to projected cap space, projecting which players will be with the organization short/long term I absolutely believe he does that and at least a framework of a fall-back plan and in each plan built-in flexibility for managing the unknown or crisis situation. How far in advance is anyone's guess. My guess is 2-3 years. Some situations may require longer-term planning (Caserio's extension) some less.

As it pertains to Brady, he's 37 and still performing at a high-level. If Brady goes down he has a kid backing him up that can -with this defense can at least keep the team competitive. If the team decides to move on from Brady, they have Grapes and the cap flexibility to acquire a veteran QB, draft one or reinforce other areas of the team (defense, etc.)

My point: Every scenario is calculated to accommodate flexibility but not over-engineered.

 

[Miguel]

Isn't there a rule that allows veteran players with 10 years of experience and 5 or more with the same team to veto a trade? I'm pretty sure there used to be such a provision. Not sure it still exists under the new CBA.

There has never been such a rule in the CBAs that have been in place since 2001

 

[Gronkandez]

Can we all just admit we don't know why this deal was done? The guys on TV and the radio who are talking out of their arse pretending to know for sure what the deal is all about are making themselves look even dumber.
I get that Kraft wouldn't want to lock up $24M without getting much interest. That's smart business. But to say that this money allows the Pats to sign Revis is just plain incorrect. The Krafts have the money. They don't need a loan.
Two potential theories are that the Pats and Brady plan to split after 2015 or that they plan to redo his contract but neither one of these theories makes much sense. We'll have to stay tuned to find out why this deal really went down.

 

[Gronkandez]

There has never been such a rule in the CBAs that have been in place since 2001

Mayo: that is a rule in MLB.

 

[BradyManny]

I have to disagree with all of these points. Neither Mallett nor Hoyer was in high demand, in fact, Brian was entirely out of job for a while. Cassel got a nice contract from KC, but that was from a former GM with a full year of performance on his resume. No one is going to pay JG a big contract based solely on preseason performance, so if Bill feels Jimmy is worth retaining, NE could be the highest bidder and still have a reasonably low cost starter at QB.

The last sentence makes no sense to me. Of course the Patriots have thought about how they would go about moving on from Brady, with JG's second contract being one of the possible scenarios. Any less is just bad business.

I agree fans over-dramatize how much other teams want our crappy backup QBs. I don't want to overstate that aspect of it. It's ridiculous every year when people think some team wants to trade a 1st rounder for our backup who at best has looked adequate against other teams third stringers. That is not what I mean to argue.

I think Mallet, Cassel, & O'Connell are 3 examples of teams slightly value-ing our trash (trash is too harsh in Cassel's case, but applies elsewhere) higher than we do. Mallet was about to be cut and got trade offers; O'Connell was claimed, then traded; Cassel is a decent player, but ultimately not worth the trade or salary he commanded, and a quick perusal of our schedule that year should've made that clear to any GM, especially a former Patriots one.

Cassel is probably the best comp b/c our hypothetical assumes JG can play to at least - hopefully better - than that level, and I'm sure Belichick had a laugh over the contract he got.

Please give me an example where the Patriots have drafted a player with his second contract in mind. I would be shocked if Belichick spends a whole lot of time thinking about year 5 when he drafts them. There's absolutely zero data when trying to make a prediction about whether you can retain these guys, and to bank anything on it would be risky. JG was primarily drafted to be cheap labor at QB2, just like Mallet, just like O'Connell. Sure, if he develops into the Aaron Rodgers to Brady's Brett Favre, that would be super - but I really doubt Belichick is making any contract moves with that expectation. People are severely underestimating how much better TB is than most QBs and how little what JG has shown so far means.

 

[Double TE]

What did TB risk by doing this? He gained $3Mil

 

[mayoclinic]

Mayo: that is a rule in MLB.

Thanks for the clarification. I don't follow baseball, so I have no idea how I got so confused. My bad.

 

[BradyManny]

If the team decides to move on from Brady, they have Grapes and the cap flexibility to acquire a veteran QB, draft one or reinforce other areas of the team (defense, etc.)

That's all fair - but we're still on the hook for a considerable amount of dead money if we move on from Brady, what Miguel said would be the biggest dead hit in NFL history. I'd hardly call that great long term planning by BB if that's his plan.

What makes the most sense is Brady plays out his contract, where given his salaries, his play could decline and he'd still be good value. JG pans out as QB2 and is the cheap backup BB has had during his entire tenure. The ifs and buts besides that are fair game for fans to talk about, but I doubt BB entertains them too seriously. BB will deal with 2018 in 2016 at the earliest, not the 2014 draft.

 

[Brady_to_Moss]

Brady clearly doesn't have an issue with this, otherwise he wouldn't have agreed to do it. Not sure why anyone else does

No one should have an issue with this. It's like a loan to kraft as someone put it for Revis, Mccourty, FAs next year ect. They could have some big plans next year to make some big moves...biggest being a nice new Revis deal.

Brady will never get cut...and I am not sure he will ever get traded. I know we all said this about Manning in Indy but I never saw Manning help his team out like Brady is doing for this franchise. He is very loyal to us and I honestly believe he ends his career here....especially if he wins another ring this year or next year.

I know it's a business...but I just have a good feeling about him staying. I am not worrying like others are that he could be gone soon. I am worried about this playoff run we are about to witness!