Posts by Ari Nissim

Money vs. a better chance of continued success

It’s always amazed me how fans decide that teams should just spend money, commenting, “The owner’s a billionaire!” The team is raking it in so why not spend more on players? Or, the owner is making X with his other company, so who cares what he spends?

These comments are typically made with

It’s always amazed me how fans decide that teams should just spend money, commenting, “The owner’s a billionaire!” The team is raking it in so why not spend more on players? Or, the owner is making X with his other company, so who cares what he spends?

These comments are typically made with no real knowledge of how much money the team actually makes, or the fact that most people do not typically run a profitable business to supplement another business, and without regard to the owner’s money as anything but monopoly money. “Hey, it’s not my money, so who cares? I just want my team to win!”

I made a comment on twitter a few days ago about LeBron James asking for a max contract. As a free agent, that is his right, and I have no problems with it if that is what he wants. There are many different people in this world brought up many different ways, so there really is no right or wrong answer. The point I was getting at on Twitter was, why? Why, in an industry where you have a limited amount of time to be great—and in this specific instance speaking about a player who makes considerable more off the court in endorsements than what he will make on it—why care about a max contract?

Tom BradyBrady has repeatedly given up more money for a better chance of winning the Super Bowl.

My point is this: If LeBron takes $17 million this year instead of his max (close to $20.7 million), yes, he is giving up almost $4 million (a considerable amount). However, as James’ endorsements are estimated at roughly $40 million per year, if you assume he decided to make a total of $57 million this year instead of $60 million, it’s a five percent pay reduction off of what would be his total compensation. Is five percent really that big of a deal compared to giving yourself a better chance of achieving other goals and your overall happiness?

If, as has been stated, LeBron is more interested in making sure the roster is better around him, then the best way to do that is to take a little bit less with the assurance that the money not taken will be spent on other talent in an attempt to make the roster better. Patriots quarterback Tom Brady has been doing this for years and he makes considerable less total money than LeBron does. But then again, it’s a question of what’s most important to that specific person. I’m not here to tell you what LeBron should or should not do, that’s for him to decide for himself. I can only tell you what I would do in a similar situation, and what I have seen other players do, that placed importance on giving themselves the best opportunity to win consistently.

I have had this conversation with multiple agents over the years and although they wouldn’t want to be quoted saying it, most agree that at a certain point, the money becomes secondary, whether the player gets $14 million in one place or $16 million in the other. Agents will typically tell the player that they should go to the place they are more comfortable with because the extra money really isn’t worth what is lost in terms of happiness.

Think of it in your own life: You like your job and are happy you make a salary of X (let’s say $57,000 for this purpose). Is it worth going to a place that you know nothing about, that you don’t have the same sense or knowledge of if they are a good organization, for an extra $3,000? Because that would be roughly five percent. For me, it’s not worth it. I’ve made this decision multiple times in my life and my personal belief is that if you are happy, the money will come. But chasing every last dollar isn’t the best way to happiness. I’m not saying that if you can’t feed your family and that an extra $3,000 will make a huge difference (which for some it does) that you shouldn’t do what’s in the best interest of your family, because your family should always come first. But if you aren’t in that situation, the question is why do something that contradicts your quoted goals for a few more bucks?

Follow Ari on Twitter: @AriNissim

Ari Nissim worked with the New York Jets from 2006 through 2013, six as Director of Football Administration; In addition he interned at the NFL League office and worked at Athletic Resource Management Sports Agency, and currently teaches in the NYU Sports Management Program. 

Read More 757 Words

Agent vs. Club: J.J. Watt mock negotiation recap

By: Joel Corry and Ari Nissim

Former NFL agent Joel Corry and former New York Jets Director of Football Administration Ari Nissim are going to give the NFP readers an in-depth perspective of how an actual contract negotiation between an Agent (Joel) and the Club (Ari) takes place in the NFL. Although condensed,

By: Joel Corry and Ari Nissim

Former NFL agent Joel Corry and former New York Jets Director of Football Administration Ari Nissim are going to give the NFP readers an in-depth perspective of how an actual contract negotiation between an Agent (Joel) and the Club (Ari) takes place in the NFL. Although condensed, Joel and Ari are attempting to take readers through a player contract negotiation from beginning to possible conclusion in weekly segments. Whether they can reach an agreement on the hypothetical contract extension is not known by anyone at this point. The player Joel and Ari will be negotiating over is Houston Texans pass rusher J.J. Watt, the 11th overall draft selection from the 2011 NFL Draft.

Below are our thoughts and impressions of the negotiation.

CLICK HERE for part I.
CLICK HERE
for part II.
CLICK HERE
for part III.
CLICK HERE
for part IV.
CLICK HERE
for part V.

AGENT (Joel): I commend Ari in how he portrayed the team side in the negotiation. I didn’t have leverage with two years left on J.J.’s rookie contract. I knew early on that there wasn’t going to be a deal. It was obvious that Ari was only interested in a team friendly deal (and rightly so at this time), while I wasn’t going to agree to anything that didn’t make J.J. the highest paid non-quarterback in the league. Because of the value I placed on J.J.(redefining the non-quarterback market), Ari needed to accept my view of how the salary landscape for the NFL’s best players was going to change in the next couple of years as the salary cap increases (which he didn’t) to have a chance of reaching an agreement. Our negotiation was a good illustration of the challenges in signing great players to new deals with so much time left on their rookie contracts.

Typically, the earliest first round picks sign contract extensions is in their contract year when leverage starts to shift from team to player. Even then, there’s the threat of franchise tags looming over a player once his contracts expires.

J.J. WattThe problem for Watt was that he still has two years remaining on his current deal.

I’m not expecting any of the 2011 first round picks that had fifth-year options exercised to sign new deals before the end of the 2014 season. Patrick Peterson’s case is interesting because of Richard Sherman and Joe Haden defining the top of the cornerback market. The best bets would have been Aldon Smith if he had stayed out of trouble since the San Francisco 49ers are one of the most proactive teams in signing core players to long term deals prior to the expiration of rookie contracts and Cam Newton without the ankle surgery. By the way, Anthony Davis is the only 2010 first round pick that had his contract extended after three years.

Ari had a valid point with the state income tax issue. It’s something that rarely came up in actual negotiations I was a part of when working for a sports agency. If it had been something that a team kept making a part of discussions, I would have consulted the player’s accountant and financial advisor for information to minimize the difference or rebut the contention. Another thing I didn’t give Ari credit for was making J.J.’s overall compensation through 2017 almost $2.75 million more with much better cash flow than playing out his contract and getting franchised for two years (assuming salary cap growth remains constant to this year). It would have taken on more significance if my contract demands had been lower.

The idea of an alternative structure with a voiding mechanism was an attempt to put more focus on the straight five-year extension by providing a less attractive option. I could have made the voidable deal a more viable option by giving Ari a general framework (length and overall dollars) where I asked him to provide the remaining parameters (yearly cash flow, guarantees, etc.) within my constraints.

An element that couldn’t be replicated in our mock negotiation was feedback or input I would get from the client in an actual negotiation. Since agents should work for the client, not the other way around, the client’s objectives would have shaped negotiation strategy. It’s a different strategy when the client is willing to take a reasonable deal now knowing the market could change dramatically during his new contract versus the client willing to be patient so he can potentially get a better deal or set the market.

It was also hard to introduce a holdout dynamic into the mock negotiation. Most players with more than one year left on their rookie contract aren’t willing to engage in a lengthy holdout to get a new deal. Chris Johnson and Darrelle Revis are the exceptions. I doubt directly threatening a holdout would have had much of an effect on Ari’s position.

Since there was too much of a gap to bridge our differences, setting the stage for future negotiations started becoming a consideration as the talks progressed. The starting point when talks resume, presumably after the 2014 season, would likely be at least Ari’s last offer (almost $14.225 million per year with $40 million of guarantees).

In reality, some time between the end of the upcoming season and before the start of the 2015 season, I expect J.J. to get a deal putting him near or at the top of the non-quarterback market barring a serious injury during the 2014 season.

CLUB (Ari): In any negotiation there needs to be give and take. The difficulty in this specific situation is you are speaking about arguably the best non-QB player in the league at a premier position. Thus, it creates a problem because from a team viewpoint, the only reason to do a deal with two years remaining is to get some sort of benefit ( lower average per year, less guaranteed money, more years, etc.), because without that there is no reason to do a deal early. If a Club can’t get some sort of benefit, then it’s better to let the player play out at least one more year of his current contract, which in turn keeps the potential risk of injury or poor performance on the player. By signing an extension, the club alleviates the risk of injury or poor performance by guarantying a significant amount of cash and typically significantly better cash flow than the payer’s current deal (for example, in our hypothetical, it was $20 million in first year cash and $30 million paid out in the two years remaining of the current contract).

J.J. WattWhen it comes time to finalize a new deal, Watt will most likely be the highest paid non-QB in the league.

If, in turn, the agent/player insists on being the highest paid non-QB in the league, in addition to having one of highest guarantees ever given out in the league with two years remaining, then there really is no middle ground. Whether I bought into Joel’s argument about salaries rising in the next few years for the top players (an argument he is likely correct on) is really irrelevant to this discussion because we are talking about doing the deal now. If a player wants the pay that will likely come in future years, then that player must be willing to wait to do the deal and take all the risks associated with that decision.

One way I could have presented to bridge this gap would be to add years so that you can give the average per year the player wants over the length of the deal and get the average per year for the years that a club actually thinks the player will play through for the Club. However, in this particular case, most if not all items I suggested were met with resistance which gives less of a reason to put something out there for them to argue over. It was interesting reading the comments that many people think acrimonious negotiations are the norm, but that’s typically not the case. In most successful negotiations there is an ebb and flow. There may be points of contention, however, most of the time they are dealt with professionally even when voices get raised in frustration.

Although I give Joel credit for trying to be creative in coming up with the void idea, it really was a non-starter as it gave absolutely no benefit to the club. Creative solutions need to be win-win, not win-lose as the void idea as presented. A more interesting concept would have been if he offered the same idea but the ability for the contract to void after 2018. Thus, the contract would give the club three additional years that J.J. is not currently under contract for, while giving the benefit of guaranteed money, cash flow and an out clause to the player. In the end it is unlikely the Club would take such an offer as I suggest, but it is a much harder thought for the Club to reject outright.

At multiple times throughout the negotiation I attempted to lead the discussion down a path that I thought might lead to a possible landing spot by saying we would consider a higher guarantee of X if the player’s average were to come down. However, the average never came down to what a club would consider a reasonable level with two years remaining.

What many people don’t realize is that most teams (not all) are looking for a fair deal with a player because they realize that the player plays a large part in whether the team is successful or not. The problem becomes that what is deemed fair by an agent and what is deemed fair by a club can be vastly different. I always got frustrated when I would get a deal signed and I would get a call from other agents congratulating me because they thought the deal was favorable for the club. At the end of the day most teams want a deal that will allow them to continue to build their team towards a championship while giving the player a contract that satisfies him.

Negotiations can go a number of ways, but one thing I’ve learned is that if people argue every point you make and don’t give you credit for valid arguments (i.e. the tax argument), or the fact that we were still arguing over the guarantee structure even though the majority of the deals done in the NFL have rolling guarantees such as I stated we would need in our deal, it makes it harder to get a deal done because conversations tend to get bogged down in minutia as opposed to big picture items. A negotiation is never going to give either side everything they would like. However, fighting tooth and nail on all issues is a sure-fire way to not get a deal done any earlier than it absolutely has to, in this case after the player was franchised for at least one year.

Follow Joel on Twitter: @corryjoel

Follow Ari on Twitter: @AriNissim

Joel Corry is a former sports agent who helped found Premier Sports & Entertainment, a sports management firm that represents professional athletes and coaches. Prior to his tenure at Premier, Joel worked for Management Plus Enterprises, which represented Shaquille O’Neal, Hakeem Olajuwon and Ronnie Lott. You can email Joel at jccorry@gmail.com.

Ari Nissim worked with the New York Jets from 2006 through 2013, serving six years as Director of Football Administration. In addition, Nissim interned at the NFL League office and worked at Athletic Resource Management Sports Agency. 

Read More 1935 Words

Agent vs. Club: J.J. Watt mock negotiation Part V

By: Joel Corry and Ari Nissim

Former NFL agent Joel Corry and former New York Jets Director of Football Administration Ari Nissim are going to give the NFP readers an in-depth perspective of how an actual contract negotiation between an Agent (Joel) and the Club (Ari) takes place in the NFL. Although condensed,

By: Joel Corry and Ari Nissim

Former NFL agent Joel Corry and former New York Jets Director of Football Administration Ari Nissim are going to give the NFP readers an in-depth perspective of how an actual contract negotiation between an Agent (Joel) and the Club (Ari) takes place in the NFL. Although condensed, Joel and Ari are attempting to take readers through a player contract negotiation from beginning to possible conclusion in weekly segments. Whether they can reach an agreement on the hypothetical contract extension is not known by anyone at this point. The player Joel and Ari will be negotiating over is Houston Texans pass rusher J.J. Watt, the 11th overall draft selection from the 2011 NFL Draft.

Let the negotiations continue…

CLICK HERE to read Part I
CLICK HERE
to read Part II
CLICK HERE
to read Part III
CLICK HERE
to read Part IV

AGENT (Joel): I’ve discussed your latest proposal with J.J. We have no choice but to question the organization’s seriousness about getting a deal done based on the offers you’ve made.

The new money average of your latest offer (almost $14.225 million per year) is below the $14,372,038 average yearly salary of the 10 highest paid non-quarterbacks. Just to alleviate any confusion, I took the sum of the total new money in the top 10 deals (by average per year) and divided it by the total number of new contract years (52 years) to arrive at this figure.

The 10 players used are as follows: Calvin Johnson ($16,207,143-average/7-year extension), Larry Fitzgerald ($16,142,857-average/7-year extension), Mario Williams ($16 million/6 years), Adrian Peterson ($14,213,333/6-year extension), Richard Sherman ($14 million/4-year extension), Joe Haden $13.5 million/5-year extension), Greg Hardy ($13.116 million/1-year), Clay Matthews ($13 million/5-year extension), Charles Johnson ($12,666,667/6-years) and Haloti Ngata ($12.2 million/5-years ).

Ndamukong SuhWatt’s side is willing to exclude Ndamukong Suh’s rookie deal from the equation.

The calculations are favorable to you because I excluded Ndamukong Suh’s rookie contract and Darrelle Revis’ two-year, $32 million deal with the New England Patriots. I’m considering Revis’ contract as only for one year at $12 million since it’s unlikely he’ll play 2015 under his scheduled $20 million salary. I also didn’t include Percy Harvin’s $12,843,500 new money average because I recognize that some teams value new deals which are a part of a trade differently. Instead of focusing on the new money, the total amount that will be paid to the player over the length of a deal by the acquiring team can be more of a priority. Because of this, Harvin is valued at $11,166,667 per year for these purposes. By the way, the average yearly salary of the top 10 would be $14,720,073 with the excluded players.

Since there aren’t 10 non-quarterbacks better than J.J., these figures are just more evidence of how inappropriate the deals you have been proposing are for a player of J.J.’s caliber. For your information, the average yearly salary of the top five non-quarterbacks using the parameters is $15,457,667. As you may not know, J.J. heads Pro Football Focus’ list of the NFL’s top 101 players for the second straight year. J.J.’s ranking is further confirmation that he doesn’t have any peers. The average of the top five non-quarterbacks also isn’t an appropriate gauge for J.J.

I strongly disagree with your contention that Mario Williams’ deal has a “Free Agent premium for playing in one of the less attractive free agency destinations.” His contract is more of a function of having free agent visits with other teams lined up after Buffalo than your suggestion. Williams was going to get his money wherever he signed.

I don’t find your state income tax argument compelling. I’ve never entertained such discussions in a negotiation. J.J’s contract won’t be the first. By the way, you neglected to account for the salary cap being $120.6 million when Williams signed his contract with your adjustments to his deal. An equivalent deal with the current $133 million salary cap would average slightly more that $17.645 million.

Bringing up Nnamdi Asomugha’s 2009 contract with the Oakland Raiders doesn’t change that salaries are going to continue escalating for the NFL’s best players. Otherwise, Haden wouldn’t have signed a five-year, $67.5 million contract extension last week with $45,078,193 in guarantees. The only real exception will be at running back. Instead of only two $10 million per year cornerbacks in the NFL (Revis and Brandon Carr), that number has doubled in the last couple of weeks with Sherman and Haden’s deals.

There isn’t going to be some sort of general market correction similar to what happened specifically with the top of the cornerback market in 2011 as the salary cap increases. Asomugha went from $14.296 million per year on his Oakland deal to $12 million per year after signing with the Philadelphia Eagles for five years. As you know, the third year of Asomugha’s Raiders deal voided to make it a two-year deal with a franchise tag prohibition because certain Not Likely To Be Earned incentives weren’t met.

If J.J. is the type of player a team can build around as you say, then you shouldn’t have any problem paying J.J. like the other players that teams are built around, which are usually quarterbacks. Please spare me from any more talk about how it would be so hard to stay competitive with the highest paid defensive player because it has been done. The Indianapolis Colts had five winning seasons and one Super Bowl appearance while Dwight Freeney played under a deal that made him the NFL’s highest paid defensive player in 2007. He remained as one of the highest paid defensive players for the duration of the deal.

After looking at the roster, I don’t see how J.J. would be taking up too many resources by paying him like a centerpiece player considering some of the highest priced talent on the team could be leaving in the next couple of years. Andre Johnson will be 34-years-old when his contract expires after the 2016 season. Given that he’s disgruntled, it’s wouldn’t be a surprise if he was playing elsewhere in 2015. His 2015 cap number is slightly over $16 million while his dead money is a little more than $7.3 million. Arian Foster may not see the last two years of his contract if he doesn’t return to form from his back injury. Johnathan Joseph’s contract is also up after the 2015 season. Kareem Jackson, whose contract expires after the upcoming season, seems to be the only possible Texans free agent in the next couple of years that could command a significant deal. As I’ve said before, a high-priced quarterback won’t be an issue for awhile.

Since you’ve acknowledged that J.J. would receive roughly $25 million over three years with a franchise tag, it might be more constructive if you shifted your focus to (1) how much money above this $25 million should be necessary for J.J. to give up four unrestricted years (2017-2020) now and (2) what is a fair value today of unrestricted years in the future for the game’s best non-quarterback. An extra $13 million over the next three years and valuing J.J.’s unrestricted years at $13.75 million per year with a team friendly structure isn’t enough for J.J. to sign away years in his prime where he would be a 31-year-old free agent if he completed his contract.

I’ve revised my offer to the following:

odds chart

I don’t have any flexibility with the guarantees. In light of Haden receiving slight over $45 million in guarantees, I considered raising the amount of guarantees in the proposal. Guarantees for cornerbacks have increased dramatically with the Sherman and Haden deals. I’ve already made substantial concessions structurally, but insist on skill and cap guarantees similar to the most lucrative St. Louis Rams veteran deals (Chris Long and James Laurinaitis). Robert Quinn’s next contract will likely be structured in this manner.

You can call my numbers “astronomically high” as much as you want. Less than $17 million per year for the unrestricted years of the NFL’s best non-quarterback will seem extremely reasonable in a couple of years.

I also have an idea where we may be able to find common ground on a deal much closer to what you’ve been proposing. J.J. is willing to sign such a below market deal if you are willing to add a provision that gives him the right to void the remaining years of his contract if his new money average ever falls below the defensive end franchise tag number. For example, if the 2016 non-exclusive defensive end franchise tag is greater than J.J.’s new money average, he would have the discretionary right to void the remaining years of his contract (2017-2020) no later than two days before the start of the 2017 league year. Since no one will really know how much the salary cap will increase in the future until the numbers are actually set, the voidable provision wouldn’t be a factor until the latter years of the deal if this year’s cap increase is an anomaly.

Please also consider the offer below.

odds chart

I’m not sure I agree that it will be in everyone’s best interest to table discussions if you have serious objections to either of my proposals. After J.J. successfully incurs the risk of injury and poor performance while playing another year on his rookie contract, I can assure you that the offers you are rejecting will seem like a bargain compared to the type of money we will be seeking once the season is over. As I said before, J.J. is cognizant of the different negotiating dynamics with players who got new contracts after their third NFL season when they had two years left on their rookie deals (Patrick Willis and Chris Johnson).

CLUB (Ari): Of course you don’t agree it’s in everyone’s best interest to table discussions because you want your cake and you want to eat it, too. First off, your offer of voiding the deal if the franchise tag number is higher than the average of this deal is simply a non-starter. Why would a club give any player $30 million dollars in years that he is already under contract for roughly $8.9 million just so the deal may void before the club gets any benefit of doing the new deal? You cannot possibly have a valid and justifiable explanation for this, and I’m actually concerned if you have led your client down this type of thought process. It actually offends us that you would make a comment such as us not taking this matter seriously when we have made multiple offers and have moved significantly in our proposals despite the fact that J.J. has two years remaining on his contract, a fact you continually discount. Furthermore, you may not find the tax argument persuasive. However, I guarantee that J.J’s financial advisor and his bank account find it persuasive when he gets to keep more of his earnings.

Although I could rebut the arguments you have made about the top 10 non-quarterbacks, the simple fact is only three of those players have higher averages per year than our last offer to J.J. and two of those players were in the last year of their contracts and the other was a free agent when they received those extensions. However, there is no point in continuing to go back and forth with you when you are asking for significantly more money than the averages you use to back your own arguments.

If $50 million guaranteed is something that is that important to you and J.J., it is something that we would consider, as long as the structure is as we have proposed with the guarantee initially being for injury only and then guaranteeing fully in that league year, a concept you have said you don’t believe is an issue, thus we are not sure why you continually argue about the structure except for you to beat your chest when recruiting. However, please note we will only consider a $50 million guarantee if your new money average per year comes down to an average closer to the top 10 average you mentioned above. If this is something you think you can work with, we look forward to seeing you present another offer within these parameters. If not, we appreciate your effort and will revisit the matter after the upcoming season.

AGENT (Joel): That’s the pot calling the kettle black. I understand that any deal J.J. signed wouldn’t stand up for its duration, but it’s ridiculous to expect a player who has the most run stuffs and sacks in the NFL over the last two seasons to agree to a deal that will quickly become obsolete. Good luck naming another current player capable of accomplishing this feat. At least you finally made an offer that exceeds the average in the deal a 30-year-old Julius Peppers signed a little over four years ago (barely and with less in guarantees).

A deal close to your number with the team-friendly structure that you want is an impossibility. Right now, it has to be deal closer to your number with a player-friendly structure or a deal closer to my number where I’m making structural concessions. For the record, we don’t consider something near the average of the top five non-quarterbacks close enough to my number. However, we could probably live with third day of the waiver period for the guarantees under the right circumstance. $50 million in guarantees is justifiable considering there weren’t any cornerbacks with $30 million in guarantees two weeks ago.

My second option was an attempt at being creative by coming up with an alternative to a straight deal, which is a lot more than can be said of your attempts at signing J.J. for a relative bargain. My general concept is still valid. J.J. might have thought twice about rejecting your offers with the inclusion of salary escalators or Not Likely To Be Earned Incentives, or higher salaries with some sort of salary de-escalators.

I’m not going to counter my own offer because it’s an unreasonable request. If you want to table discussions for now, that’s your prerogative.

J.J. is paying close attention to Patrick Peterson’s negotiations since he is a Pro Bowl-caliber player taken in the first round of his draft class. It will speak volumes to J.J. if the Arizona Cardinals give Peterson a deal comparable to or better than your last offer during this off-season.

Next Week—Negotiation Post Mortem 

Follow Joel on Twitter: @corryjoel

Follow Ari on Twitter: @AriNissim

Joel Corry is a former sports agent who helped found Premier Sports & Entertainment, a sports management firm that represents professional athletes and coaches. Prior to his tenure at Premier, Joel worked for Management Plus Enterprises, which represented Shaquille O’Neal, Hakeem Olajuwon and Ronnie Lott. You can email Joel at jccorry@gmail.com.

Ari Nissim worked with the New York Jets from 2006 through 2013, serving six years as Director of Football Administration. In addition, Nissim interned at the NFL League office and worked at Athletic Resource Management Sports Agency, and currently teaches in the NYU Sports Management Program. 

Read More 2589 Words

Agent vs. Club: J.J. Watt mock negotiation Part IV

By: Joel Corry and Ari Nissim

Former NFL agent Joel Corry and former New York Jets Director of Football Administration Ari Nissim are going to give the NFP readers an in-depth perspective of how an actual contract negotiation between an Agent (Joel) and the Club (Ari) takes place in the NFL. Although condensed,

By: Joel Corry and Ari Nissim

Former NFL agent Joel Corry and former New York Jets Director of Football Administration Ari Nissim are going to give the NFP readers an in-depth perspective of how an actual contract negotiation between an Agent (Joel) and the Club (Ari) takes place in the NFL. Although condensed, Joel and Ari are attempting to take readers through a player contract negotiation from beginning to possible conclusion in weekly segments. Whether they can reach an agreement on the hypothetical contract extension is not known by anyone at this point. The player Joel and Ari will be negotiating over is Houston Texans pass rusher J.J. Watt, the 11th overall draft selection from the 2011 NFL Draft.

Let the negotiations continue…

CLICK HERE to read Part I.
CLICK HERE
to read Part II.
CLICK HERE
to read Part III.

AGENT (Joel): Thank you for another offer that doesn’t alleviate our Andre Johnson concern. Making a distinction between his six-year extension and your offer of five new years is meaningless. The same problem would have existed for him with a five-year extension.

Your new offer is below the latest non-QB data point. As you know, Seahawks cornerback Richard Sherman recently signed a four-year, $56 million extension ($14 million average per year) with $40 million in guarantees. This deal is more evidence of the changing market conditions for the game’s top players.

Richard ShermanRichard Sherman’s new contract has added another dimension to these negotiations.

Patrick Peterson, the fifth overall pick in J.J.’s draft class, has been anticipating that he would get a new contract this off-season. He’s going to try to make Sherman’s reign as the NFL’s highest-paid defensive back a short one. Unlike Sherman, he is clearly the best player in his team’s secondary.

I have a hard time believing Ndamukong Suh will accept anything below Sherman’s deal. It’s more likely that Suh will eclipse the $15 million average per year an aging Richard Seymour received on a fully guaranteed two-year deal from Oakland in 2011 than he will take an extension under Sherman’s.

You can choose to ignore that salaries are going to continue escalating for the best players. That approach won’t be conducive to us reaching an agreement. I appreciate that J.J. is under contract for two more years. I just view the anticipated changes in the salary landscape for top non-quarterbacks in the coming years as an overriding consideration.

I recognize that you raised the overall amount in guarantees from $22 million to $36 million. Reducing the amount fully guaranteed at signing from $22 million to $17 million is counterproductive.

The offer below contains substantial concessions structurally. Although I have reservations about the organization’s ability to maintain the policy on offsets with rookie first-round selection Jadeveon Clowney because Greg Robinson (Rams) and Blake Bortles (Jaguars) will probably sign contracts without offsets, I’m willing to accommodate you on the issue.

I’ve also accepted the concept of conditional guarantees by significantly lowering the amount fully guaranteed at signing. Once again, I’ve tried to keep the percentage of Total Running Cash at the beginning of the proposal consistent with the five-year extensions Aaron Rodgers and Patrick Willis received with two years remaining on their contracts. In the later years, I’ve adopted a percentage of Total Running Cash comparable to those years in your new offer.

odds chart

CLUB (Ari): Joel, with all due respect, J.J. Watt having an agent should alleviate the Andre Johnson concern that you continually mention. If you or your client does not wish to do a deal two years early because other players may sign for higher amounts after J.J. signs, then we suggest waiting.

We appreciate the walk down memory lane of old Raiders contracts. However, you failed to mention the contract that Nnamdi Asomugha signed in 2009 as an Oakland Raider at an average over $15 million per year. An average that Richard Sherman’s new contract did not eclipse event though he is currently the highest paid CB in football. Thus, your point about contracts at the top of the marketplace always increasing is not certain, especially when the top of the market contract has a free agent premium for playing in one of the less attractive free agency destinations such as Buffalo.

J.J. WattWill the Texans make Watt the highest-paid non-quarterback in the league?

As I have mentioned before, if you are attempting to take into account contracts that are to be negotiated in the future or looking to make J.J. the highest paid non-QB in the league, it’s probably best for everyone to continue these conversations after the season. Your numbers are astronomically high, and as Darrelle Revis’ misguided one-year pirate voyage showed, a high average is not always a benefit to the player. This is something we are attempting to avoid in J.J.’s deal. Part of our reason for extending J.J. is the fact that we believe he is the type of player our team can build around, but that also means we believe he is a player that realizes that making a great salary while allowing his club to continually compete is better than being the highest-paid player without the possibility of the team getting better because he is taking up too many resources.

None of your arguments justify a deal of the magnitude you are asking for when weighed with the facts that two years currently remain on J.J’s contract or the fact that over the next three years J.J. would receive roughly $25 million if we franchise him (something we would prefer not to do). Our current offer is significantly more than that three-year amount in both cash to be paid over that same period and guarantees in an effort to show how serious we are in doing this deal.

In addition, by playing in Houston, J.J. benefits from the fact that Texas does not have a state income tax which provides him with a savings of as much as 13.3 percent over players that play in other states, or more specifically, J.J. will save 8.82 percent in New York where Mario Williams signed. 8.82 percent is the equivalent to $1.4 million per year. Thus, J.J. Watt making $14.6 million per season would be the equivalent of Mario Williams making $16 million per year in New York.

In regards to your recognition of the conditional guarantees structure, we are happy you see that this is a way we can accommodate increasing our overall guarantee amount. However, it will have to guarantee for skill and cap in that league year just as the deals for Richard Sherman and Earl Thomas that were recently signed have been.

In an attempt to demonstrate our seriousness, we have increased our guarantee to $40 million, with $19 million paid in the first year, increasing our average per year to over $14.2 million a year in new money. If you take into account the savings J.J. receives because of the lack of a state income tax, this deal is equivalent to roughly $15.6 million if he were to sign a deal in New York.

We sincerely would like to get a deal done with J.J. However, if you feel that the contract we are proposing will create a dilemma in the future, and J.J. does not want an additional $20+ million dollars in the years that he is currently under contract for, then we appreciate the time you’ve spent on this, but feel it’s probably in everyone’s best interest to wait until after the season to continue our talks. If you do not find our current offer to be adequate, your counteroffer will have to reflect a significant reduction in regards to the total package if we have any hope in finding common ground.

odds chart

Next Week—Will the two sides come closer to making J.J. Watt the highest-paid non-quarterback in football?

Follow Joel on Twitter: @corryjoel

Follow Ari on Twitter: @AriNissim

Joel Corry is a former sports agent who helped found Premier Sports & Entertainment, a sports management firm that represents professional athletes and coaches. Prior to his tenure at Premier, Joel worked for Management Plus Enterprises, which represented Shaquille O’Neal, Hakeem Olajuwon and Ronnie Lott. You can email Joel at jccorry@gmail.com.

Ari Nissim worked with the New York Jets from 2006 through 2013, serving six years as Director of Football Administration. In addition, Nissim interned at the NFL League office and worked at Athletic Resource Management Sports Agency, and currently teaches in the NYU Sports Management Program. 

Read More 1396 Words

Agent vs. Club: J.J. Watt mock negotiation Part III

By: Joel Corry and Ari Nissim

Former NFL agent Joel Corry and former New York Jets Director of Football Administration Ari Nissim are going to give the NFP readers an in-depth perspective of how an actual contract negotiation between an Agent (Joel) and the Club (Ari) takes place in the NFL. Although condensed,

By: Joel Corry and Ari Nissim

Former NFL agent Joel Corry and former New York Jets Director of Football Administration Ari Nissim are going to give the NFP readers an in-depth perspective of how an actual contract negotiation between an Agent (Joel) and the Club (Ari) takes place in the NFL. Although condensed, Joel and Ari are attempting to take readers through a player contract negotiation from beginning to possible conclusion in weekly segments. Whether they can reach an agreement on the hypothetical contract extension is not known by anyone at this point. The player Joel and Ari will be negotiating over is Houston Texans pass rusher J.J. Watt, the 11th overall draft selection from the 2011 NFL Draft.

Let the negotiations continue…

CLICK HERE to read Part I.

CLICK HERE to read Part II.

AGENT (Joel): I’m willing to work with you on the structural framework of J.J.’s deal. My degree of structural flexibility will largely hinge on the financial components of the contract. I’m not looking at the contract’s structure in a vacuum.

I’m curious about how the team’s policy on offsets will work if you remain at the top of the draft or a quarterback is selected with another high pick in the event of a trade. Quarterbacks taken in the top-five since the 2011 Collective Bargaining Agreement implemented the rookie wage scale haven’t signed contracts with offsets. Your first round pick shouldn’t be treated more favorably than J.J. would be with a new deal.

All of the top non-quarterback contracts are relevant to the negotiations because J.J. has transcended his position with his extraordinary play. I wouldn’t be resistant to narrowing the scope of our discussions if J.J. was just an above average player.

There isn’t any compelling reason why J.J. should sign a contract extension in the $12 million per year range. J.J. isn’t interested in signing a new deal that will quickly become obsolete as salaries continue to escalate for the game’s best players.

Ndamukong Suh is currently having talks with the Detroit Lions about an extension. He’s earned almost $52 million in his four NFL seasons from his rookie contract. I can’t see Suh taking a pay cut from the rookie deal he got as an unproven commodity after he’s become the NFL’s best defensive tackle. I expect Suh’s deal will make him one of the NFL’s five highest-paid non-quarterbacks. If franchise player Greg Hardy signs a long term deal with the Carolina Panthers, it will likely exceed Charles Johnson’s $12,666,667 average per year with more than $32 million in guarantees. As you know, $30 million of Johnson’s guaranteed money was a signing bonus.

J.J. WattThe two sides are getting close, but can they reach an agreement?

Chris Long’s four-year extension averaging slightly over $12 million per year containing $36.75 million in guarantees should serve as a starting point for Robert Quinn, who was taken three picks after J.J. in the 2011 draft. I’m sure you will point out that Long had $23.55 million fully guaranteed at signing. Since his $13.2 million 2014 base salary became fully guaranteed five days after Super Bowl XLVII (February 8, 2013), I consider him having $36.75 million practically fully guaranteed at signing. The likelihood of the Rams cutting Long before the full guarantee in 2014 kicked in was infinitesimal because his $13.25 million 2013 base salary was already fully guaranteed. Since Long signed his deal in 2012 when the salary cap was $120.6 million, I really look at Quinn’s worse case scenario as an extension averaging close to $13.3 million per year with slightly more than $40.5 million in guarantees. That’s basically the equivalent of Long’s deal with a $133 million salary cap.

Most, if not all, of the top young wide receivers with rookie contracts (Dez Bryant, A.J. Green, Julio Jones, Demaryius Thomas) should top the five-year extension averaging $12,843,500 per year Percy Harvin signed in his trade to the Seattle Seahawks on their next deals. It won’t be a surprise if at least one of these receivers gets a deal in the Larry Fitzgerald/Calvin Johnson neighborhood.

The amount of guaranteed money in your initial offer is also insufficient. Since $8,876,385 of the $22 million fully guaranteed is J.J.’s own guaranteed money, the new guaranteed money is merely $13,123,615. Although J.J.’s $6.969 million 2015 base salary is only guaranteed for injury right now, you and I both know that there isn’t a scenario where that salary won’t become fully guaranteed. This exact issue didn’t exist with Duane Brown or Brian Cushing because their existing contracts didn’t contain guaranteed money when they received their extensions.

It’s disingenuous to mention Clay Matthews’ guaranteed money without recognizing that it’s an anomaly because of Green Bay’s structural conventions and how it compares generally with the other top outside linebacker deals in existence when he signed. Besides Aaron Rodgers, the Packers don’t have a player on a veteran contract with guaranteed money outside of the first year of the deal.

DeMarcus Ware’s six-year extension with the Dallas Cowboys contained $40 million in guarantees. The $40 million was practically fully guaranteed because they weren’t cutting him one season into the deal after giving him $25 million more than he was scheduled to make in the last year of his rookie contract (his contract year). Terrell Suggs had $37.1 million guaranteed in his six-year deal. The $23 million in an option bonus was practically fully guaranteed at signing considering the last time the Baltimore Ravens didn’t pay an option bonus was with Elvis Grbac in 2001. Tamba Hali had $35 million guaranteed in the five-year deal he signed in 2011. He was in a similar situation as Chris Long because $19 million in base salary became fully guaranteed two days after the start of the waiver system in 2012 (February 7). I know that those guarantees voided because of Hali’s one game suspension for violating the NFL’s substance abuse policy, but that doesn’t negate how the deal was structured.

J.J. is well aware of the different negotiating dynamics with players who got new contracts after their third NFL season when they had two years left on their rookie deals. Things went so smoothly with Patrick Willis that he signed his extension approximately three months before training camp started while Chris Johnson had to force the Titans’ hand in order to get a new deal.

I hope you sincerely take our concerns into consideration when making another offer.

CLUB (Ari): Joel, you make valid points in your argument. Especially in regards to your point about J.J.’s guarantee for injury only being essentially guaranteed because we both agree there likely isn’t much of a chance outside of injury that he will not be on our roster in 2015. Since we agree with your assessment that J.J. will likely be on the roster in 2015 unless a serious injury occurs, our sides should have no problem agreeing to guarantee the money in future years for injury only until the 5th day of that league year. This will allow us to substantially increase our offer in terms of guaranteed dollars, because we would avoid funding the money to the league for deferred compensation purposes. Thus, in the spirit of compromise and consideration of your views we have increased the guarantee amount in our offer substantially.

In regards to the pass rushers you mention, Terrell Suggs and Demarcus Ware both signed contracts with six new years which increased their total guarantee amount. In addition, both Terrell Suggs ($10.6 million/year) and Tamba Hali ($10.6 million) took substantially less on an average per year than our initial offer, not to mention our new proposal which has a higher average per year than all of the pass rushers you mention. Further, I do take exception with your thoughts on Clay Matthews, as he is the most recent dominant pass rusher to sign a contract. And although you may not like how that contract is structured, it is part of the landscape. Finally, there are other teams that do things similar to the Packers, the Steelers being one of them.

To answer your question about offset, as previously mentioned this is a deal breaker for us. As for your question about our draft picks, it’s something we have had in every first round deal including J.J.’s rookie deal as you know. In addition, the No. 1 overall pick last year had offset in his deal.

In regards to Patrick Willis, in addition to the other points we have made about his contract, he had $750,000 in 46-man per game roster bonuses in each new year of the deal, which means the deal can be reduced by a total of $3.75 million if he is not active for every game, which in turn would reduce his contract’s new money average per year to $9.25 million a year. This is a component we have not put into our deal for J.J., thus not reducing J.J’s opportunity to earn every dollar of his contract if he misses games.

Furthermore, we don’t base deals on hypothetical scenarios, such as the ones you mention for Robert Quinn and the young receivers. If J.J. feels more comfortable playing the 2014 season under his current contract while the players you mention do or do not receive contracts, then we will oblige J.J.’s wishes and wait until 2015 to pursue a contract. However that would be J.J.’s choice, not ours.

In listening to your concerns and how you view J.J.’s current contract’s guarantee, we have attempted to bridge the gap and have moved substantially in guaranteed dollars. This substantial move in guarantee dollars was done to show we are serious about doing a deal now, however, please do interpret this one-time move to indicate future movement. Our offer has substantial movement in both guaranteed dollars and New Money Average Per Year. Thus, if our current offer is not considered a serious attempt to sign J.J., we are not sure how to reach an agreement with two years remaining on his current contract.

The offer presented below will give J.J. $35 million in guaranteed money and pay $27 million over the next two years; $18 million more in cash over what he is scheduled to make during the next two seasons. Please find our offer below. We look forward to hearing your thoughts after you and J.J. have reviewed this proposal. Thank you.

odds chart

Next week—Can both parties find a common ground?

Follow Joel on Twitter: @corryjoel

Follow Ari on Twitter: @AriNissim

Joel Corry is a former sports agent who helped found Premier Sports & Entertainment, a sports management firm that represents professional athletes and coaches. Prior to his tenure at Premier, Joel worked for Management Plus Enterprises, which represented Shaquille O’Neal, Hakeem Olajuwon and Ronnie Lott. You can email Joel at jccorry@gmail.com.

Ari Nissim worked with the New York Jets from 2006 through 2013, serving six years as Director of Football Administration. In addition, Nissim interned at the NFL League office and worked at Athletic Resource Management Sports Agency, and currently teaches in the NYU Sports Management Program. 

Read More 1871 Words

Agent vs. Club: J.J. Watt mock negotiation Part II

By: Joel Corry and Ari Nissim

Former NFL agent Joel Corry and former New York Jets Director of Football Administration Ari Nissim are going to give the NFP readers an in-depth perspective of how an actual contract negotiation between an Agent (Joel) and the Club (Ari) takes place in the NFL. Although condensed,

By: Joel Corry and Ari Nissim

Former NFL agent Joel Corry and former New York Jets Director of Football Administration Ari Nissim are going to give the NFP readers an in-depth perspective of how an actual contract negotiation between an Agent (Joel) and the Club (Ari) takes place in the NFL. Although condensed, Joel and Ari are attempting to take readers through a player contract negotiation from beginning to possible conclusion in weekly segments. Whether they can reach an agreement on the hypothetical contract extension is not known by anyone at this point. The player Joel and Ari will be negotiating over is Houston Texans pass rusher J.J. Watt, the 11th overall draft selection from the 2011 NFL Draft.

Let the negotiations continue…

CLICK HERE to check out Part I.

AGENT (Joel): I’ve had an opportunity to review your offer with J.J. We appreciate the spirit in which it was made as the common goal should be to ensure that J.J. stays in Houston for a long time. Your proposal doesn’t satisfy one of our primary concerns. We aren’t interested in a contract extension in the $12 million per year range because it doesn’t adequately address the Andre Johnson problem I mentioned to you in our previous discussions.

Any salary comparisons for J.J. should be with the top of the non-quarterback market. For example, the average of the three highest paid non-quarterbacks (Calvin Johnson, Larry Fitzgerald and Mario Williams) is $16,122,500 per year. $49,416,667 is the average in guarantees with their deals.

J.J. WattIs Watt worth what his “agent” is asking for?

I don’t accept your notion that a deal resetting the market place must occur when a player is in a contract year, hits free agency or has been franchised. The San Francisco 49ers set the inside linebacker market with Patrick Willis in 2010 when he had two years remaining on his five-year rookie contract. Willis signed a five-year, $50 million extension containing $29 million in guarantees. As you know, there were special structural challenges with the deal because of the uncapped year. It’s been almost four years and that deal has held up, unlike in Andre Johnson’s case. Willis still sets the inside linebacker market.

More recently, the Green Bay Packers reset the quarterback market in 2013 when Aaron Rodgers signed a five-year, $110 million extension with two years left on his contract. Additionally, Chris Johnson set a new salary standard for running backs in 2011 with two years left on his five-year rookie deal. He signed a four-year extension averaging $13,493,750 per year when the top of the running market was Steven Jackson’s five-year extension averaging $8,619,500 per year. The average salary in these three deals is 18.02% more than the average salary in their predecessors’ deals as the highest paid at their respective positions.

I believe the Texans are equipped to handle a contract that adequately reflects J.J.’s true value. With the trade of Matt Schaub, $17 million and $19 million salary cap numbers have been wiped off the books in 2015 and 2016, which may have made a deal for J.J. more challenging. Barring something unforeseen, your organization should have a young quarterback on his first contract (with modest cap numbers) at the helm over the next few years.

We believe the following contract below is more appropriate for a player of J.J.’s caliber.

odds chart

Base salaries in yellow are guaranteed for Skill, Injury and Cap-No Offsets; $5 million of 2017 base salary is guaranteed for Skill, Injury and Cap-No Offset.

A deal of this magnitude for J.J. shouldn’t prevent the Texans from being competitive, especially considering the lack of a high-priced quarterback on the roster for the foreseeable future and your expertise at managing the cap. I have attempted to keep the percentage of Total Running Cash in J.J’s proposal consistent with the five-year extensions Aaron Rodgers and Patrick Willis received that reset their respective markets while having two years remaining on their contracts.

I’m open to different contract structures, including use of an option bonus. However, any option bonus structure should provide the same type of security Jonathan Stewart received in the five-year extension he signed with the Carolina Panthers in 2012.

CLUB (Ari): Joel, thank you for the offer, but we do not understand how you justify $18.5 million per year for J.J. while he has two years remaining on his contract. We believe that with J.J. and some of our other pieces and the No. 1 overall pick we have the ability to start building something special here, but that requires every player, coach and staff buying into the Texans Way. Although we understand your point that currently we do not have a quarterback under contract with a large salary, that doesn’t mean we will pay that money to one player. We are not interested in paying individuals, but rather players that understand that they are part of the team and every dollar spent on them is one less dollar that goes to helping them bring in a player to help us all reach our ultimate goal. We want to be fair with players and prudent in safeguarding the team’s ability to become a consistent contender and will spend that money to build our team in that pursuit.

First, let me address that the Andre Johnson situation you mentioned was unique because his initial contract was a deal that was done without an agent, thus creating a situation that ultimately was changed. Andre originally signed a six-year contract extension, a longer term than what we have been speaking about for J.J. The shorter term contract we are speaking about for J.J. should also alleviate some of your concern about the Johnson situation.

In response to Larry Fitzgerald, Calvin Johnson and Mario Williams, none of those players had two years remaining on their current deals when they signed their new contracts. Fitzgerald and Johnson were entering the final year of their respective contracts and both signed contract extensions that added seven new years. Mario Williams was a free agent who signed a six-year deal as opposed to the five-year extension we are speaking about.

Calvin JohnsonThe “Club” wants Calvin Johnson’s deal to be removed from the discussion.

Even though we do not believe wide receivers are relevant to this conversation, we must clarify that the guarantee you mention for Calvin Johnson is inaccurate. Calvin Johnson signed a seven-year extension with $48.75 million guaranteed at signing, not the $53.25 million that you mentioned, which likely came about by inadvertently adding the money that becomes guaranteed if the club chooses to exercise their buy-back of the last two years of the contract – a decision the Lions do not need to make until 2017. In addition, after the Lions exercise the option in year two of the deal, the remaining $11.5 million yet to be earned of the $48.75 million guaranteed becomes guaranteed for injury only, thus reducing the effective fully guaranteed amount to $37.25 million.

Furthermore, if we were going to look at Johnson, Fitzgerald and Williams, it would only be fair to prorate the guaranteed dollars to what they would be for a five-year contract since each one of those players signed longer deals. Calvin Johnson’s per year guarantee is $6.965 million (seven years/$48.75m), Larry Fitzgerald’s is $6.429 million and Mario Williams’ guarantee would be at a prorated amount of $8.33 million. If you average those three numbers, you get $7.242 million on a guarantee per year, then multiplying that amount by five new years, the guarantee amount is roughly $36.2 million. A guarantee amount of $36.2 million is substantially less than the $55 million your proposal asks for and is derived using your own methodology. Finally, this still does not account for the portion of those guarantee numbers that are guaranteed for injury only.

As you mentioned, Patrick Willis had many structural challenges which no doubt led to part of his increased average per year. In addition, $13.5 million of the $29 million guaranteed was guaranteed for injury only, not fully guaranteed as you are asking for. This is the case with many of the contracts you mention. For instance, Mario Williams had only $39.4 million fully guaranteed at any point in his deal and only $24.9 million was fully guaranteed at the time of signing.

We would finally like to narrow the scope of this discussion to defensive players. If you are going to bring up wide receivers and every other top contract in the league, I will bring up the top contracts at other positions such as Rob Gronkowski, who did his deal with two years remaining and signed for an average of $9 million per year, or the newly signed Earl Thomas, who just inked a contract in the last year of his rookie deal becoming the highest paid safety at $10 million per year. We do not believe these comparisons will benefit either side, thus, let’s try and narrow the scope of this discussion to front seven defenders. In this regard, we acknowledge that Mario Williams signed a six-year deal in 2012 for $96 million after becoming a free agent as we have discussed previously. In addition, Clay Matthews signed a five-year extension with Green Bay in 2013 in the last year of his rookie contract. Matthews’ new contract had a new money average of $13.2 million per year and guaranteed $20.5 million, a guarantee that our initial offer surpassed. We believe focusing on these types of defenders will help us work towards our common goal.

Finally, we must note that as much as we truly want to do a deal with J.J., any deal will have an offset in the guarantee language. This is a club policy and not something we will change. We appreciate that you may feel differently about this, however this is the only way a contract of any sort will be done by us. We have put it in deals for Duane Brown, Brian Cushing and Johnathan Joseph and will not deviate. If this is unacceptable to J.J., we do not need to continue our talks.

In an attempt to bridge the gap between our differences, we are open to increasing our guarantee and potentially increasing the cash flow over the first two years, but the average per year on the deal would have to be much closer to our average per year. We do not believe you are giving due consideration to the fact(s) that J.J. is under contract for the next two years and if we franchise him in 2016, even assuming a franchise amount of $16 million, his total pay for the next three years is a little under $25 million, with the majority of that coming in the franchise year. We seek your thoughts and insight on how we can collectively solve our differences and come to a meeting of the minds on this agreement.

Next Week—Will the two sides come closer to an agreement?

Follow Joel on Twitter: @corryjoel

Follow Ari on Twitter: @AriNissim

Joel Corry is a former sports agent who helped found Premier Sports & Entertainment, a sports management firm that represents professional athletes and coaches. Prior to his tenure at Premier, Joel worked for Management Plus Enterprises, which represented Shaquille O’Neal, Hakeem Olajuwon and Ronnie Lott. You can email Joel at jccorry@gmail.com.

Ari Nissim worked with the New York Jets from 2006 through 2013, serving six years as Director of Football Administration. In addition, Nissim interned at the NFL League office and worked at Athletic Resource Management Sports Agency, and currently teaches in the NYU Sports Management Program. 

Read More 1889 Words

Agent vs. Club: J.J. Watt mock negotiation Part I

By: Joel Corry and Ari Nissim

Former NFL agent Joel Corry and former New York Jets Director of Football Administration Ari Nissim are going to give the NFP readers an in-depth perspective of how an actual contract negotiation between an Agent (Joel) and the Club (Ari) takes place in the NFL. Although condensed,

By: Joel Corry and Ari Nissim

Former NFL agent Joel Corry and former New York Jets Director of Football Administration Ari Nissim are going to give the NFP readers an in-depth perspective of how an actual contract negotiation between an Agent (Joel) and the Club (Ari) takes place in the NFL. Although condensed, Joel and Ari are attempting to take readers through a player contract negotiation from beginning to possible conclusion in weekly segments. Whether they can reach an agreement on the hypothetical contract extension is not known by anyone at this point. The player Joel and Ari will be negotiating over is Houston Texans pass rusher J.J. Watt, the 11th overall draft selection from the 2011 NFL Draft.

Let the negotiations begin…

CLUB (Ari): Thank you for meeting with us today to discuss J.J. Watt. As you know, we hold J.J in high regard. We wanted to sit down to speak about extending his contract because J.J. is exactly the type of player, both on and off the field, who embodies the qualities of the Texans organization. From an organizational standpoint, he is someone we want to represent the organization for a long time and be part of bringing a championship to Houston. As winning is the ultimate goal of both J.J. and the Club, we want to work with you to create a win-win solution that will allow us to continually build a competitive team around Watt. So our first question is this: What is important to J.J. when considering an extension that will allow the team to remain competitive?

AGENT (Joel): We appreciate the organization’s interest in signing J.J. to a new deal. He is happy in Houston and would like to spend his entire career with one team. That being said, J.J. has done some things that are unprecedented over the last two years, particularly while primarily playing as a 3-4 defensive end. He has established himself as not only the NFL’s top defensive player, but the best non-quarterback in the game and should be paid accordingly in 2014 and beyond.

CLUB (Ari): We do not disagree that J.J. is a talented defensive player and someone that shows that hard work truly does pay off. However, as you know, he is currently under contract for 2014 at roughly $1.9 million and we have exercised the option year for 2015 which is $6.969 million for a total of $8.876 million for the next two years. Thus, by doing an extension this early, the Club has to receive credit for the years remaining as well as alleviating the financial risk of injury from the player by receiving a deal two years before his current contract is finished. J.J. is a player we have a great deal of respect for, but we cannot consider any one individual above the entirety of the organization; so any deal would have to consider the impact in allowing us to be a consistent Super Bowl contender which is something we know J.J. understands and appreciates.

With that in mind, please tell me who are some comparable player contracts you have looked at in determining what you believe the appropriate value for J.J.’s contract should be? In addition, do you have any thoughts on the length of the contract?

AGENT (Joel): We understand that the organization controls J.J.’s rights for the next two years at significantly less than his market value. If the salary cap goes up the same as it did this year (8.13%) in each of the next couple of years, which is a conservative estimate, it will be around $145 million in 2015 and $156 in 2016. Any deal must reflect the impact the growth of the cap will have on salaries for top players. It’s in nobody’s interest for J.J. to be in the same situation Andre Johnson was in after he signed his six-year extension in 2007. He quickly became unhappy with his deal because the wide receiver market changed. The organization addressed the inequity three years later in 2010.

J.J. WattNo player in the league has amassed more sacks over the last two years (31.0) than Watt.

J.J. is so unique that he does not have any defensive peers. He is the rare player that is a dominant pass rusher and run stopper. J.J.’s 31 sacks since the start of the 2012 season are tops in the NFL. He also leads the NFL with 38 run stuffs over the last two years. As you know, J.J. had 20.5 sacks in 2012, which tied him with Lawrence Taylor for the sixth-most all-time in a season. He also became the youngest player in NFL history to reach the 20-sack mark in a single season as a 23-year-old.

Conventional statistics don’t do J.J. justice. Football Outsiders has a metric called “Defeats” that measure turnovers (or tipped passes leading to turnovers), tackles for loss, and tackles or passes defensed on third or fourth down. J.J’s 56 Defeats in 2012 were the most since Football Outsiders started the metric in 1996. According to Pro Football Focus (PFF), J.J. batted an unheard of 15 passes in 2012. Nobody else in the last five years has reached double figures in batted passes.

In some respects, J.J.’s 2013 campaign was better than his 2012 season when he was the near unanimous NFL Defensive Player of the Year. He had 85 total quarterback pressures (combined sacks, quarterback hurries and quarterback hits) in 2013 according to PFF after posting 76 pressures in 2012. J.J. also graded out better in 2013 than 2012 with PFF. His 111.6 grade was 10 points higher than his 2012 grade of 101.6. The next highest grade for a defensive player in the last two years is Geno Atkins in 2012 at 80. J.J. is the modern day equivalent to Reggie White, but without a contemporary who is a modern day Bruce Smith.

J.J. has transcended his position. His dominance as a defensive lineman is on par with Calvin Johnson’s dominance at wide receiver. As you know, Calvin Johnson signed a 7-year, $113.45 million extension in 2012 with $53.25 million in guarantees. Johnson’s deal is two years old while the salary cap has gone up 10.28% since he signed. The equivalent deal with a $133 million salary averages almost $17.875 million with approximately $58.725 million in guarantees.

I appreciate that the Texans can control J.J.’s rights for up to an additional three years by placing franchise tags on him. The defensive end number increased from $11.175 million to reach $13.116 million this year, a 17.37% increase. With comparable increases until J.J. can be franchised in 2016, his tag number will be almost $18.075 million. A second franchise tag in 2017 with a 20% increase would be $21.69 million. Please note that these two additional years for J.J. could cost the Texans close to $40 million.

We are open to a lengthy extension provided it ensures that J.J. isn’t faced with the same problem Andre Johnson encountered after a couple of years with the value of his extension.

CLUB (ARI): We appreciate your insight into the future of the salary cap and can debate the merits of the league salary cap increasing, however, no one truly knows what those numbers will be until they are set. We believe your metrics accounting for the franchise tag increase are a bit off, as the franchise tag is determined by a percentage of the top-five players for that individual position for that year,by summing the amounts for that for the franchise tag at that position for the last five years and divided by the league salary cap for those years to create a percentage that is multiplied by the league salary cap for that year . For example, to predict the 2016 franchise number assuming the $156M cap number as you suggested, Watt’s franchise number would be roughly $15.6 million. A franchise number of $15.6 million would assume a 10% defensive end franchise percentage which is higher than the percentage has been for a defensive end in any of the past three seasons (typically 8.7%-9.9% of that year’s cap). That being said, we believe focusing on the franchise number will only sidetrack us towards our common goal.

What cannot be debated is the fact that any extension for J.J. would move the injury risk from a financial perspective from his shoulders and place that risk on the Club, something we are willing to do because of our respect for his play and passion for the game. We understand your position in regards to what type of player J.J. is and we would expect nothing less from an intelligent and well prepared agent such as yourself. However, you can appreciate that the deals that reset market places typically are deals that are signed either entering the final contract year or when the player in question completes his contract. Our organization is not interested in resetting the market place for defensive ends two years early. If J.J. is looking for the sums you mentioned, we may be better off waiting until next year to revisit this conversation. However, let us propose the following contract below that will make J.J. one of the top-five highest paid defensive players in the league in new money, while still allowing our organization the ability to put players around him so we can all collectively achieve our goal.

odds chart

Base salaries in Yellow are guaranteed for skill, injury and cap

AGENT (Joel): I appreciate the offer. I’ll share it with J.J. and will get back to you shortly.

Next Week – The response to the initial offer.

Follow Joel on Twitter: @corryjoel

Follow Ari on Twitter: @AriNissim

Joel Corry is a former sports agent who helped found Premier Sports & Entertainment, a sports management firm that represents professional athletes and coaches. Prior to his tenure at Premier, Joel worked for Management Plus Enterprises, which represented Shaquille O’Neal, Hakeem Olajuwon and Ronnie Lott. You can email Joel at jccorry@gmail.com.

Ari Nissim worked with the New York Jets from 2006 through 2013, serving six years as Director of Football Administration. In addition, Nissim interned at the NFL League office and worked at Athletic Resource Management Sports Agency, and currently teaches in the NYU Sports Management Program. 

Read More 1660 Words

The Jimmy Graham dilemma

Jimmy Graham is a phenomenal talent with a young career that has already seen two 1,200+ yard receiving seasons as well as 41 touchdowns over four years. He’s a player that can affect and change the game. Simply put, Jimmy Graham is a difference maker.

If you listen to agents they will tell

Jimmy Graham is a phenomenal talent with a young career that has already seen two 1,200+ yard receiving seasons as well as 41 touchdowns over four years. He’s a player that can affect and change the game. Simply put, Jimmy Graham is a difference maker.

If you listen to agents they will tell you that most of their clients are those types of players. Simple fact … they’re not! In actuality, there are a lot less of these players than people believe, but the New Orleans tight end is one of them. So then what is the dilemma? Why is there more talk about a potential grievance being filed than that of a deal getting done for Graham?

The 2014 tight end franchise number is roughly $7.05 million. The wide receiver franchise number is $12.1 million, a difference of $5 million. This is important because Jimmy Graham, although a TE, lines up in the slot and out wide at a typical receiver position more than the majority, if not all the tight ends in the league. Thus, an argument for the higher franchise valuation can be made because Article 10, Sec 2(a)(i) of the NFL CBA states that, “the franchise designation of a player will be determined according to where the Franchise player participated in the most plays during the prior League Year.” If Graham can get an arbitrator to believe that plays for a tight end should only count if they are lined up on the line, then perhaps the arbitrator will decide that Graham should be viewed as a wide receiver and receive the higher amount.

With the looming potential of a grievance being filed, there are reasons on both sides to do a deal, especially before any verdict is reached. The reason for Graham to do a deal is the fact that if he loses the arbitration case and is deemed a TE, his 2014 franchise number is $7.05 million. Worse, however, is the very real potential of being franchised again in 2015 for $8.5 million (120% of the 2014 franchise number), thus delaying his impending free agency for two full seasons.

The reason for the Saints to do a deal before a grievance and/or arbitration verdict follows a similar path; if an arbitrator were to find that Graham should be franchised at the wide receiver number of $12.1 million, then not only will it cost an additional $5 million in 2014, but it will also make franchising him in 2015 more costly, counting potentially $14.5 million against next year’s cap. Furthermore, it makes completing a long-term deal that much harder because if Graham knows he is getting $26 million over the next two years, what reason does he have to get a deal done for much less than an average of $13 million per season? Additionally, the guaranteed amount would need to be at least $26 million and likely more for the deal to make much, if any, sense for Graham to sign.

Jimmy GrahamGraham is likely making the case that he is worth $12-$13 million per year.

In addition, Jimmy Graham is one of the top (non-quarterback) playmakers in the game. In thinking about offensive skill position players, there are not many that would be considered better and more reliable playmakers than Graham. The short list likely consists of Calvin Johnson, Adrian Peterson and A.J. Green. Health takes both Rob Gronkowski and Julio Jones out of the equation. Thus, Graham is arguably the fourth-best non-quarterback offensive skill player in the league. Thus, why not pay him whatever it takes to get a new contract signed by this difference maker? Why is there more talk of a potential grievance about the amount he should be paid under his franchise designation than talk of the two sides getting close to a deal?

The current issue the club and player are probably battling over is the average per year amount which, in turn, will work into how much is guaranteed. The years will work themselves out, but the average per year is a problem. The highest paid tight end in the league is Rob Gronkowski, who signed a six-year extension for $54 million in 2010 with two years remaining on his contract at the time. Herein lays the dilemma.

If the Saints are going to reset the tight end market by making Graham the highest paid TE, the problem becomes how much more they will be willing to pay over Gronkowski’s $9 million average per year, as well as how much more guaranteed than the $15.5 million they would pay if they simply franchise Graham over the next two years. Teams do not particularly care to reset the bar for positional salaries and when they do, they would like to keep the amount as in-line with the market as possible. So if the Saints agree to make Graham the highest paid TE in the league, the number I would assume they would want to pay is likely $9.5 million per year. This is a defensible position from a club’s perspective because you are making the player the highest paid player at his position, with considerably more guaranteed than the $7 million under the franchise tender this season.

The offer the Saints are probably standing behind is something along the lines of five years for a total value of $47.5 million with $20 million guaranteed. This type of offer would be defensible from a club perspective for a number of reasons. First, it makes Graham the highest-paid player at his position. Second, it guarantees considerably more money than the $7.05 million of the franchise tender this year. Unfortunately, Graham and his agent likely do not agree with the Saints’ perspective.

From the agent’s perspective, this is likely a case of the aforementioned unique player. Unique players get contracts that reset the market place by a larger margin, and Graham is one of those players. There is precedent in this line of thinking such as when Larry Fitzgerald reset the wide receiver market, moving the number of the highest receiver contract from roughly $10 million per year to $15 million per season, or when Adrian Peterson reset the running back market from roughly $9 million per year to his $14.2 million average. In addition, there are currently wide receivers making $10 – $12 million per year who Graham has out-produced, as well as the fact that the salary cap increased $10 million (or 8.13%) this year providing teams with the ability to increase pay accordingly. The agent is likely asking for something in the range of $12 – $13 million per season with a guarantee of $30 million, which has led to the dilemma and potential pending grievance.

There will be posturing by both sides and there is always the possibility of the player not showing up until halfway through the season (New England offensive lineman Logan Mankins held out until November in 2010 when those negotiations got ugly after the Patriots RFA tendered him because of the rules of the uncapped year), but Graham would be giving up $414,882 for each regular season week he decided to miss.

At the end of the day, Jimmy Sexton (Graham’s agent) and Mickey Loomis (Saints GM) are both proven veterans that know how to make a deal when the time is right, and for that reason I think this deal will get done most likely at a number that is a little above or below where each of the parties would like it to be.

Follow Ari on Twitter: @AriNissim

Ari Nissim worked with the New York Jets from 2006 through 2013, serving six years as Director of Football Administration. In addition, Nissim interned at the NFL League office and worked at Athletic Resource Management Sports Agency, and currently teaches in the NYU Sports Management Program. 

Read More 1219 Words

Five free agent signings that hit the mark

This list may not be comprised of the marquee signings that took place on the first day of free agency. In fact, there are only two players on this list that signed a contract exceeding two years in length. What I was looking for in writing this article was the player’s ability to make

This list may not be comprised of the marquee signings that took place on the first day of free agency. In fact, there are only two players on this list that signed a contract exceeding two years in length. What I was looking for in writing this article was the player’s ability to make an immediate impact for his new franchise while weighing the value efficiency of each contract.

1. Hakeem Nicks – WR – Indianapolis Colts [1 Year – $4M] — This is exactly the type of free agent signing that can have a huge impact with limited downside from both a play and monetary perspective. Nicks has ties to the Indianapolis coaching staff, as head coach Chuck Pagano and wide receivers coach Charlie Williams both worked at North Carolina while Nicks was playing for the Tar Heels. This gives everyone a level of understanding of what they are getting. The benefit to the Colts’ situation is that Nicks doesn’t have to be “the man.” With Reggie Wayne, T.Y. Hilton, and Dwayne Allen already featured in the passing attack, and one of the elite young guns in Andrew Luck distributing the ball, Nicks has a real chance to succeed in a big way.

Alterraun VernerVerner notched a career-high five interceptions last season.

2. Alterraun Verner – CB – Tampa Bay Buccaneers [4 Years – $25.5M] — This is a player that has good skills that fit Lovie Smith’s defensive system. Adding Verner to a secondary that already features quality safeties will allow the former Tennessee Titan to play to his potential. Although he may not be as good a corner as a healthy Darrelle Revis, because of the requirements of Lovie’s system, the Bucs were able to address a number of positions by spreading the money earmarked to Revis ($16M Per Year) around while still landing a corner in Verner that will allow them to play solid defense.

3. B.J. Raji – DL – Green Bay Packers [1 Year – $4M] — Raji has had a tough go of it the last few years; playing out of position by moving to defensive end has not helped his production. However, sometimes teams need guys to man positions that may not be the best situation for the player, but better for the team as a whole. If the Packers move Raji back to nose tackle, I believe he will regain the form that made him shine during his first couple of years in the league. This kid has a ton of talent and at the end of the day, people with Raji’s size and athleticism are not found on every street corner, or every NFL team for that matter. Remember, the best big nose tackles in this league can easily play into their mid- 30s, so to bring back Raji—who will play this season at 28-years-old—is not a bad decision by the only team he has ever played for.

4. Brandon Pettigrew – TE – Detroit Lions [4 Years – $16M] — Every offensive coach I have ever been around has always said that having a blocking tight end is an important part of building an offense (They are typically called the ‘Y’ tight end, which is the inline tight end). The ultimate is having a blocking tight end who can catch. As the game has evolved, the majority of tight ends have become more athletic with an increased focus on receiving, thus, a large majority of tight ends today cannot block very well. Although Pettigrew is not an elite tight end, he’s a solid blocker who can put up production in the passing game, which affords an offense the ability to do things in multiple formations. That adds a lot of value.

Justin TuckTuck brings two Super Bowl rings to the Oakland locker room.

5. Justin Tuck – DL – Oakland Raiders [2 Years – $10M] — This is not the typical signing you would see on this type of list, because a lot of the reasons you are signing this type of player aren’t necessarily going to be seen on the field. Although Tuck still has some good football left in him, his leadership abilities, as well as the other ancillary benefits that come with having a player like this in meeting rooms and the building, can do a lot for a team’s character.

Follow Ari on Twitter: @AriNissim

Ari Nissim worked with the New York Jets from 2006 through 2013, serving six years as Director of Football Administration. In addition, Nissim interned at the NFL League office and worked at Athletic Resource Management Sports Agency, and currently teaches in the NYU Sports Management Program. 

Read More 734 Words