After reports that the Buffalo Bills were close on Sunday, Monday morning brought news that the team had re-signed Jerry Hughes to a five-year, $45 million contract extension, keeping together the core of a defensive line that has led the league in sacks during each of the past two seasons.
As we just did with LeSean McCoy (post here), let's break down how the Bills will pay Hughes over the next five years (with numbers reported by Mike Florio). As you'll see, by splitting the "signing bonus" into two years, the Bills keep Hughes' 2015 and 2016 cap hits relatively low, while preventing his cap charge from spiking up until 2017, when Kyle Williams and his 2015-2016 cap hits of $6.4 and $7 million will be off the books. Also, in 2017, Mario Williams' astronomical cap hit drops from 2015-2016 values of $19.4 and $19.9 million to $16.5 million. That $3.4 million drop from 2016 to 2017 corresponds with a $2.875 million increase in Hughes' cap hit from 2016 to 2017.
Contract by payment type
- SIGNING BONUS: $7 million. This number is relatively small, but is really just the first part of a two-part "signing bonus." This number will be prorated over the five years of the contract.
- 2016 OPTION BONUS: $6 million. This option is fully guaranteed (most likely through a non-option exercise fee of $6 million), and so essentially works as deferral of half of a $13 million signing bonus for Hughes. This number will be prorated over the last four years of the contract.
- BASE SALARIES: $27.25 million. These numbers stay relatively low and never raise above $6.35 million, as Hughes is seeing considerable compensation through bonuses.
- ROSTER BONUSES: $4 million. Each of these bonuses ($2 million, $1 million, $1 million) occur at the start of the league year during 2017-2019, the last three years of the contract.
- WORKOUT BONUSES: $750,000. Hughes will receive $150,000 each year to attend offseason workouts.
Contract by base & guaranteed values
- TOTAL VALUE: $45 million. As Hughes does not really have any contingent pay in his contract, the total is calculated by adding all payments. See the breakdown below:
$7 million (signing bonus) +
$6 million (option bonus) +
$27.25 million (base salaries) +
$4 million (roster bonuses) +
$750,000 (workout bonuses)
- FULL GUARANTEES: $17.625 million. This number consists of the $13 million combined value of the signing bonus and guaranteed option bonus, as well as Hughes' 2015 salary of $4.625 million.
- INJURY GUARANTEES: $4.525 million. Hughes' 2016 salary is guaranteed for injury at signing.
- POTENTIAL FULL GUARANTEES: $22.15 million. On the fifth day of the 2016 league year, the above $4.525 million guaranteed for injury only becomes fully guaranteed, consisting of the maximum total guaranteed money for Hughes. Hughes is just turning 27 years old and has plenty of gas left in his tank; these guarantees are not concerning, as he was going to see that money no matter what.
- TOTAL CONTRACT VALUE: five years, $45 million, $17.625 million fully guaranteed, with $22.15 million guaranteed for injury at signing and fully at the start of the 2016 league year.
Contract by yearly earning potential
Hughes' year-by-year earnings are a little less front-loaded due to the splitting of his signing bonus over two years.
- PAID IMMEDIATELY: $7 million. That's the signing bonus.
- 2015: $4.775 million. In addition to the signing bonus value, Hughes will make $4.625 million in base salary plus a $150,000 workout bonus.
- 2016: $10.675 million. Hughes will earn the $6 million option bonus, a $4.525 million base salary, and a $150,000 workout bonus next year.
- 2017: $7.550 million. Hughes will earn $5.4 million in base salary, a $2 million roster bonus, and a $150,000 workout bonus.
Many NFL teams view contracts over the first three years; for Hughes, that equals $30 million over three years, or $10 million a year.
- 2018: $7.5 million. Hughes will earn a $6.35 million base salary, a $1 million roster bonus, and $150,000 workout bonus.
- 2019: $7.5 million. This year's breakdown is exactly the same as the 2018 breakdown above.
Contract by yearly salary cap hits
Hughes is still only 26 years old (turning 27 before the season), so there is a solid chance that he will play out the life of this well-done and reasonable contract. Here are Hughes' yearly cap hits (along with Mario Williams and Kyle Williams) to demonstrate how the Bills may have been thinking bigger picture on this deal.
- 2015: $6.175 million ($19.4 million for Mario, $6.4 million for Kyle). This includes $1.4 million in prorated bonus.
- 2016: $7.575 million ($19.9 million for Mario, $7 million for Kyle). This includes $1.4 million in prorated bonus and $1.5 million in prorated option bonus.
- 2017: $10.45 million ($16.5 million for Mario). This includes a $2 million roster bonus, and the aforementioned $2.9 million in prorated bonuses.
- 2018: $10.4 million. This includes a $1 million roster bonus, and the aforementioned $2.9 million in prorated bonuses.
- 2019: $10.4 million. This breakdown is exactly the same as the 2018 league year.
You'll note that Hughes' cap hits really rise precipitously after both Kyle Williams and Mario Williams' current deals expire.