As you’ve no doubt heard, Fletcher Cox just signed a mammoth deal with the Philadelphia Eagles. The contract extension totals $102.6 million over six years and makes Cox the highest paid defensive player in terms of total guarantees ($63 million) and the second highest paid defensive player in terms of average annual compensation (only Ndamukong Suh makes more per year on average).
By: Jack Raleigh
So.. what do we make of this contract? Is it worth it for the Eagles?
The vast majority of articles I’ve read have concluded that the contract was a good move for the Eagles. Personally, I think it’s a bad contract and a huge mistake. Here’s why:
Setting the Criteria
When NFL free agency was going on, I identified three goals when signing players to substantial contracts:
1) Just don’t do it (unless it’s a QB). In general, handing out a ton of cash to a player isn’t a smart decision. And by a ton of cash, I mean the really big contracts like Cox’s.
Of course there’s the economic analogy of risking a ton of your assets into a single investment. But there’s also player motivation to consider. I’ve already shown that running backs and wide receivers are susceptible to increased production levels right before they sign new contracts and decreased production levels right afterwards. I imagine other position groups will behave similarly, and verifying that hypothesis is on my list.
QBs are the exception to this rule in my mind because the elite ones really can win you championships and keep your team competitive with an otherwise-depleted roster.
2) Front load contracts to minimize out-year dead money. I’ve previously written about the pitfalls of dead money in big contracts. Long story short, cutting players prematurely and incurring dead money penalties can absolutely cripple a roster. The Saints right now are a prime example.
Put another way, this rule is essential for contracts because it protects you in case you are wrong.
3) Structure contracts with relatively even cap hits in out-years. Players like guaranteed money. When the guarantees run out on their contract and they are playing at the top of their game, they try to re-negotiate to get – you guessed it – more guaranteed money.
As a cap manager, you obviously want to prevent this re-negotiation from occurring. Once the guaranteed money runs out, you have complete control over the player. If he underperforms, you can cut him with little or no penalties. If he does well, you can keep him at the same price, which is probably a good value since the contract would have been negotiated 2-4 years prior.
A surefire way to allow the player to gain leverage in this re-negotiation is to structure his initial deal with skyrocketing cap hits in out-years. Those huge hits will make it extremely difficult for you to maintain the rest of your roster, and you could be more easily convinced to re-negotiate and fork over more guaranteed money to that player.
Put another way, this rule is essential for contracts because it protects you in case you are right.
Evaluating the Contract
=> Criterion #1: Don’t sign non-QBs to massive contracts.
Analysis: The Eagles signed a non-QB to a massive contract. Making matters worse, Cox’s position isn’t even the most important one on the defensive line. If I were forced to break the bank on a defensive lineman, I would do so on an edge rusher, not a tackle.
Conclusion: Fail.
=> Criterion #2: Front load contracts to minimize out-year dead money.
Analysis: Courtesy of OverTheCap, let’s take a look at Cox’s dead money penalties:
Released prior to 2017: $36,299,000
Released prior to 2018: $29,800,000
Released prior to 2019: $20,400,000
Released prior to 2020: $14,000,000
Released prior to 2021: $7,600,000
Released prior to 2022: $1,200,000
The first three years would cause catastrophic cap penalties for the Eagles. The first year where a release is plausible – but still incredibly painful – is prior to the 2020 season, with a hit of $14M. Even prior to 2021, a $7.6M dead money hit is nothing to laugh at, though it’s manageable.
Conclusion: Fail. The Eagles have all but guaranteed that Cox will be on the roster at this price for the next 3 seasons. They could spread out the hit a bit by making Cox a post June 1 cut, but it would still cripple Philly’s ability to build their roster.
=> Criterion #3:Structure contracts with relatively even cap hits in out-years.
Analysis: Again courtesy of OverTheCap, here are Cox’s cap hits by year:
2016: $6,499,000
2017: $9,400,000
2018: $17,900,000
2019: $22,000,000
2020: $20,300,000
2021: $17,200,000
2022: $17,100,000
And now we see the real knife in the Eagles’ back on this contract. During the 2019 season, Cox carries a ridiculous $22M cap hit. For perspective, even Olivier Vernon’s massive contract – one that I slammed in my free agency article – doesn’t have a cap hit above $19.5M over the life of the contract.
Conclusion: Fail once again. There’s no reason that the Eagles couldn’t have tried harder to even these cap hits out.
For those of you thinking that the Eagles deserve credit for the diminishing hits in 2020, 2021, and 2022… think again. Remember what I said earlier? How post-2019 is the first time that the Eagles could theoretically cut Cox without a substantial penalty? Isn’t it funny how 2019 is magically his biggest cap hit? If he’s playing well in 2017-2018, he and his agent will be in a prime position to re-negotiate the contract to obtain more guaranteed money before and during the 2019 season. If he’s not playing well, then he will be cut. Either way, it’s highly unlikely that the Eagles get Cox to play out years 2020-2022 on this contract.
Summary
The Eagles could have had Cox under contract for $7.8M in 2016 under the 5th year option and $13.6M in 2017 under the franchise tag. Retaining Cox in this manner would have maximized the chances that his level of play remained high, as he would have essentially had back-to-back contract years in 2016 and 2017.
Instead, the Eagles have committed $63 million in guaranteed money to Cox spread out over several years. They have committed themselves to Cox through at least 2018 because of untenable potential cap penalties, and they have set themselves up to be vulnerable during potential contract re-negotiations in 2019 due to Cox’s high cap number in that season.
Fletcher Cox and his agent deserve an A+ for this contract. The Eagles deserve something far worse.
Is Cox an elite player? Absolutely. But signing an elite player to a horrible contract is still a bad decision.
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