Career Contract Analysis: Tom Brady

Career Contract Analysis: Tom Brady
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Love him or hate him, it's hard to deny the notion that Tom Brady is one of the greatest NFL players of all-time. It's also very well-known that Brady and his New England Patriots front office have worked hand in hand over the past 17 years to ensure that he's compensated well, but in a manner that provides the team spending flexibility elsewhere. We'll take a quick look at the various contracts of Tom Brady, highlighting some of these maneuvers along the way.

 

The Rookie Contract (2000)

  • Total Contract: $866,500
  • Actually Earned: $533,660

Brady was selected in the 6th round (#199 overall) back in 2000 out of Michigan University. He agreed to a 3 year $866,500 contract with New England that June, including a $38,500 signing bonus (he's since averaged $723,511 per game played over his career to date). After barely seeing the field in 2000, Brady was thrown into the fire in Week 2 of the 2001 season after starting QB Drew Bledsoe was carted off with an injury. 15 years later, he still hasn't given the starting job back.

First Extension (2002)

  • Total Contract: $34,000,000
  • Actually Earned: $19,012,680

The Patriots quickly paid Brady like a franchise starting QB, signing him to a 4 year $30.145M extension through 2006. The deal included a $3.5M signing bonus and a $6M option bonus over the first two seasons. Brady rewarded the franchise with Divison Titles in 2003, 2004, AFC Championships in 2003, 2004, and a Super Bowl victory in 2004. Brady agreed to convert a total of $7.64M in 2003 & 2004 salaries, which became guaranteed cash in hand.

Second Extension (2005)

  • Total Contract: $60,100,000
  • Actually Earned: $54,515.500

With two years and $14.5M remaining on his first extension, the Patriots and Brady agreed on a 4 year $42.8 million new money extension. The deal included a $14.5M signing bonus (not a coincidence) , and a $12M second-year option bonus. Brady restructured $5.28M of his 2007 salary into bonus, guaranteeing that as well. With his career at a peak, Brady suffered a season ending knee injury early in on in 2008. It's the only year since 2003 that the Patriots haven't won the AFC East. Brady and the Patriots bounced back in 2009, after which another extension was put in front of him.

Pre-Lockout Extension (2010)

  • Total Contract: $72,000,000
  • Actually Earned: $48,250,000

With a lockout looming in 2011, Brady and the Patriots agreed to a substantially front-loaded extension that included $16.5M in 2016 cash and $19.75M in 2011 cash ($10M of which came in the form of deferred signing bonus, which wouldn't be affected during the lockout). In 2012 Brady agreed to convert $10.8M of his salary and roster bonus into signing bonus, guaranteeing that cash in hand while clearing a whopping $7.2M in cap space for New England, an important move with the league now under a hard salary cap. With a whopping $34M remaining on his contract through 2014, the Patriots and Brady came to agreement on another deal. It was at this point that the two sides appeared to come to an understanding of how Brady's compensation needed to be structured going forward.

Cap-Friendly Extension (2013)

  • Total Contract: $61,000,000
  • Actually Earned: $37,000,000

The Patriots tacked on an additional three years to Brady's previous deal, with $27M in "new money" included. The new structure handed Brady a whopping $30M signing bonus to go along with low, manageable base salaries ($1M in 2013, $2M in 2014 all guaranteed). By structuring things this way, Brady's cap figures remained under $15M during this contract, allowing flexibility for the Patriots elsewhere. The deal also included a clause that if Brady was on the roster at the end of the 2014 season, his remaining $24M in salary through 2017 would become fully guaranteed. Not only was he on the roster, but he was on the field for the last day of the season, as the Patriots won their 4th Super Bowl.

Guarantee-Free Extension (2015)

  • Total Contract: $27,000,000
  • Actually Earned: $8,000,000

However, in what can only be explained as a "cautious move", the Patriots agreed to a new deal with Brady that added a $1M raise in each 2015-2017, but in turn removed all full guarantees. At 38 years old it's understandable why New England felt the need to protect themselves from a $24M guarantee (and with Deflate-Gate to come, it became even more important to keep things simple contractually). However Brady would only play out his $8M 2015 season before a new deal came about.

Suspension-Friendly Extension (2016)

  • Total Contract: $60M
  • Earned Thus Far: $28M

With a suspension stemming from "Deflate-Gate" looming, the Patriots did Brady a bit of a favor, signinig him to a 2 year $41M new money extension (through 2019), that included a $28M signing bonus, bure maybe more importantly, dropped his base salaries in 2016 & 2017 from $9M/$10M to $1M/$1M. On the previous $9M salary Brady was set to forfeit $529,411 per game missed. He now forfeits "just" $58,823 (a total of $235,292 for his 4 games suspension). As in the previous deal, none of Brady's base salaries are fully guaranteed, leaving only the $28M signing bonus as guaranteed cash. He carries ridiculously low cap figures of $13.7M and $14M though 2017 before things raise to $22M in each of 2018 and 2019 when he'll be 42 years old.

Breaking Down the Career Earnings

  • 47% of Brady's earnings to date have come via signing bonus ($92M)
  • 10% ($18M) have come by way of options bonuses in 2002 and 2006. 
  • 10% more ($17.7M) salaries or roster bonuses that were converted to signing bonus.
  • 22% ($43.5M) have come from base P5 salaries
  • 12% ($23M) have come from roster bonuses. 
  • 1% have come by way of incentives or workout bonuses

Once he finishes out 2016, Brady will have topped the $196M mark in estimated career earnings. He's slated to earn only $1M in 2017, with potential payouts of $15M are available in both 2018 and 2019. While it's not likely he finishes out this contract (see everything above), if he does, he'll have reeled in a whopping $227M on the field. For what it's worth, Peyton Manning earned $248.7M over 18 NFL seasons.

 

Comparing Recent Earnings

When looking at the average cash earnings since 2011, Brady currently ranks 3rd among notable quarterbacks.

 

In Conclusion

The Patriots certainly found lightning in a bottle back in 2000, and it took a horrible injury to even get him on the field in the first place. But the way New England has handled Brady contractually since 2002 has been nothing short of brilliant. He's never finished a contract - in fact he's only played out more than three years of a contract once, and it's safe to assume that was in large part because of the uncertainty of Brady's return following the 2008 knee injury. By constantly "re-upping" with their franchise quarterback, the Patriots continually put signing bonus cash in their franchise quarterback's pocket, and can keep a strong handle on their annual salary cap.

 

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