If a player decides to renegotiate his contract, how does the bonus money he received in the original contract count against the cap?
If a player renegotiates his contract and gets a new signing bonus, the new signing bonus is prorated over the remaining years of the original contract AND over the extension. The allocation of the original signing bonus remains unchanged. For example, Player X is currently in the third year of a four-year deal (20062009) that paid him a $1 million signing bonus. In 2008, Player X renegotiates his deal extending his contract to the 2011 season while getting a $2 million signing bonus. The original $1 million signing bonus is allocated at $250,000 per year over 2008 and 2009 just as it would be if there were no renegotiation. However, the new $2 million signing bonus is allocated at $500,000 per year over the remaining two years of the original contract (20082009) and the extended two years (20102011). Thus the cap liability in 2008 and 2009 is actually $750,000 for the signing bonus proration — and $500,000 in 2010 and 2011, assuming no additional renegotiation takes place.
