Kaepernick Signs Extension
Last Wednesday the San Francisco 49ers signed quarterback Colin Kaepernick to a six-year extension. On top of the one year remaining on his rookie deal, the 49ers now own his rights through the 2020 NFL season. Needless to say, Mr. Kaepernick was pretty excited about the prospect of earning $126 million to play football.
And, needless to say, 49ers fans were pretty excited as well.
See Kaepernick Make Money
Yet, even in the moment, there were some doubts. Averaging $21 million a year over the extension would currently make Kaepernick the second-highest paid player in the NFL, after Aaron Rodgers. And $61 million guaranteed is the most any player has ever received, eclipsing the $58 million the Denver Broncos guaranteed Peyton Manning in 2012. Despite some struggles, Kaepernick has clearly been a keeper since emerging as the starter, especially since his electric, dynamic, record-breaking, many adjective performance against the Green Bay Packers in the 2012 NFC Playoffs.
See Kaepernick Run
But, even for the above, even in the NFL, $21 million a year with $61 million guaranteed is A Lot of money. Or so it seemed in the moment. In the aftermath some key details emerged.
The Deal Is in the Details
Kaepernick’s cap hit for the coming season remains very low, with only $3 million of his prorated $12 million extension signing bonus adding on to a base salary of $645 thousand. (That is, $3,000,000 onto a base salary of $645,000 for a cap hit less than $4,000,000.)
And of the $61 million guaranteed, only $13 million is fully guaranteed. His 2015 salary (amounting to nearly $15 million all told) only guarantees if he is on the roster on April 1st, 2015. His 2016 and 2017 salaries also guarantee only if he is on the roster in April of those years. Roughly $5 million of his 2018 salary guarantees for being on the roster in April of 2018, and after 2018 nothing is guaranteed. Throughout the extension, the 49ers can evaluate Kaepernick’s contract at the end of each season and decide whether to continue or release him at minimal cost.
And it gets better. For every year that the 49ers do not appear in the Super Bowl and Kaepernick is not selected a 1st or 2nd Team All-Pro, Kaepernick loses $2 million a season. But as soon as the 49ers do appear in the Super Bowl or Kaepernick is selected as an All-Pro, that $2 million kicks in for every year left on the deal. The 49ers or Kaepernick must be in the top two league-wide for one season, or Kaepernick will lose $2 million each year until that happens.
Kaepernick also loses some money if, for whatever reason, he does not play. From 2015-2020, $12 million comes via $125,000 per-game roster bonuses. Throughout the extension, for each game Kaepernick is not on the active roster the 49ers keep $125,000. And, in after-tax dollars, he must purchase a $20 million disability policy to be paid to the 49ers should his career end in injury.
A Win-Win, Unless They Lose…
All of these details make the deal pretty terrific, for both sides. If the worst should happen, the 49ers really only lose the $12-plus million signing bonus and some change. Until both Kaepernick and the 49ers play at a truly elite level (as indicated by Kaepernick being a 1st or 2nd Team All-Pro or the 49ers reaching the Super Bowl), the 49ers retain $2 million of the deal per season. The deal’s dead money drops to a manageable $5 million by the 2017 season, and disappears completely by 2019.
Most likely, the 49ers will pay Kaepernick lots and lots of money, but it is about as risk-free as a deal for a starting NFL quarterback can be. 49ers beat writer Matt Maiocco remarked that Kaepernick had bet on himself, and so too has the 49ers front office bet on themselves. It is an expensive deal, but a low-risk deal, a fair deal, a great deal, a many adjective deal.
As a fan, I could not be happier for Colin Kaepernick, and I could not ask for more from 49ers chief contract negotiator and salary cap architect Paraag Marathe. This contract may cement the 49ers as a team to be reckoned with into the next decade, and 49ers fans will get to enjoy one of the league’s most exciting players every game. Will they win the Super Bowl during Kaepernick’s six-year extension? Maybe…but history indicates it may be a bit tougher going forward. Check back tomorrow for more.