For example smitty will cost us a cap hit of 10.7 million in 2012. His salary for 2012 is 7.75 million. That means that the other 3 million is the cap hit for the signing bonus he received in 2007. Since he is a free agent in 2013 we couldn't restructure his current contract as there is nothing to defer. We could extend him for 4 years for example which would allow us to take some of that 7.75 million in salary and pay it as a signing bonus which would be spread out over the new contract. For 2012, you will be on the hook for the 3 million signing bonus under the old contract, the prorated part of the new contract signing bonus plus whatever part of the 2012 salary that still applies. So maybe his cap hit goes down 2 or 3 million. The reason you would do that is because the cap is going to go way up when that TV deal hits so we could afford to pay him more down the road. The reason you wouldn't do it is whether you think he will still be playing at 37-38 years of age.
Travelle you might not restructure unless you thought he would be here for several years. His salary in 2012 is 5.7 million and in 2013 is 5.9 million. But his guaranteed money was only 12 million. If you cut him today you would be on the hook for 4 million (2 million for 2012 and 2 million for 2013). If you cut him as of June 1st you can take that hit over 2 years I think. If you do nothing you are on the hook for a cap hit of 7.6 in 2012 and close to 8 million for 2013. If you restructure him you end up saving a million or two this year but add that money on to 2013 making it unlikely you are going to pay him 10 million so you pay a premium for him to play 1 year. If you cut him after this year you end up with several million in dead cap space. If you extend him for a few years you lower the cap hit for 2012 but better make sure you plan to keep him otherwise you have a ton of dead cap space if you let him go down the road.
Clear as mud right??
Edited by panthers55, 01 February 2012 - 04:52 PM.