Thread: Why does Bowlen still owe Shanahan money?

They are showing Shanahan's press conference on NFL Network. So, it is official - Shanahan is once again employed, so why does Pat still owe him money? Obviously, I am very confused as to why.

http://www.denverpost.com/premium/broncos/ci_14130245

The Broncos will still owe Shanahan approximately $3.5 million per year in 2010 and 2011 to essentially have him coach the Redskins. Then again, Bowlen will save roughly $3.5 million each of the next two years now that their former coach is no longer

because that's apparently the way mike's contract was structured-- he must've had a provision that if he was fired, he would be paid fifty percent of his remaining salary even if he was hired somewhere else, or a hundred percent if he wasn't. . .

Originally Posted by dogfish

because that's apparently the way mike's contract was structured-- he must've had a provision that if he was fired, he would be paid fifty percent of his remaining salary even if he was hired somewhere else, or a hundred percent if he wasn't. . .

Guess that is all it could be, and I am sure, at the time the contract was signed that Pat had no idea then that he would ever fire Shanahan - i.e. so at that time, the verbiage, in Pat's eyes, was a mute point.

Originally Posted by Denver Native (Carol)

Guess that is all it could be, and I am sure, at the time the contract was signed that Pat had no idea then that he would ever fire Shanahan - i.e. so at that time, the verbiage, in Pat's eyes, was a mute point.

Yeah.. I think that pretty much sums it up.

Most likely it was a provision along the lines of making up the difference between his existing contract and the contract with his new team up to 50% of the current contract. That way it encourages getting a new gig by being able to structure a contract with a new team that is back end loaded. In this case, the Redskins only have to pay 3.5MM for the first two years and then the real meat comes in years 3-5 on the new contract. Win-win for all involved. Bowlen isn't on the hook for an additional 14MM (which he would be if Mikey stayed on vacation), and Mikey gets to negotiate a solid new contract because the intial years' are at a discount which also helps the 'Skins. But what do I know, I don't practice contract law...

Maybe that's why the deal is only $35 Mil instead of the $50 Mil that was originally reported. :shrugs:

Originally Posted by GEM

Maybe that's why the deal is only $35 Mil instead of the $50 Mil that was originally reported. :shrugs:

35MM would make years 3-5 worth an average of 9.33MM. Pretty big chunk of change even for Snyder - and a disincentive for Snyder to dump Mikey prior to the end of the five years. Everybody wins - except Snyder if Mikey flops.

Originally Posted by LawDog

Most likely it was a provision along the lines of making up the difference between his existing contract and the contract with his new team up to 50% of the current contract. That way it encourages getting a new gig by being able to structure a contract with a new team that is back end loaded. In this case, the Redskins only have to pay 3.5MM for the first two years and then the real meat comes in years 3-5 on the new contract. Win-win for all involved. Bowlen isn't on the hook for an additional 14MM (which he would be if Mikey stayed on vacation), and Mikey gets to negotiate a solid new contract because the intial years' are at a discount which also helps the 'Skins. But what do I know, I don't practice contract law...

If the following is accurate, it states his new contract is worth approximately $7 million per year. So, if accurate, 7 million there, $7 million here - should be a wash. So, what dogfish posted makes more sense that Shanahan had a provision in his contract here.

http://sports.espn.go.com/nfl/news/story?id=4801852



Tuesday, Shanahan signed a five-year contract to become the team's executive vice president and head coach. Shanahan's contract is worth approximately $7 million a year, The Denver Post reported.

I read somewhere yesterady that it is part of a buy out clause that Shanny had built into his contract.

Originally Posted by Denver Native (Carol)

If the following is accurate, it states his new contract is worth approximately $7 million per year. So, if accurate, 7 million there, $7 million here - should be a wash. So, what dogfish posted makes more sense that Shanahan had a provision in his contract here.

http://sports.espn.go.com/nfl/news/story?id=4801852



Tuesday, Shanahan signed a five-year contract to become the team's executive vice president and head coach. Shanahan's contract is worth approximately $7 million a year, The Denver Post reported.

35 divided by 5 equals 7. But that could be divided out any way you want, even 1+1+1+1+31=35. Besides, he's getting 35 from the Redskins and 7 from Denver which equals 42 or 8.4 per year. DP's lack of analysis isn't anything new or surprising.

Originally Posted by LawDog

35 divided by 5 equals 7. But that could be divided out any way you want, even 1+1+1+1+31=35. Besides, he's getting 35 from the Redskins and 7 from Denver which equals 42 or 8.4 per year. DP's lack of analysis isn't anything new or surprising.

No, since he is now employed, Bowlen does not owe him 7 mil/yr, but 3.5 mil/yr according to the article.

http://profootballtalk.nbcsports.com...n-interesting/

Posted by Mike Florio on December 27, 2009 9:05 AM ET
With the job at Florida suddenly open and given that former Broncos coach Mike Shanahan was a candidate for the job there earlier in the decade (he was also an assistant coach there from 1980-83), it's not ridiculous to wonder whether Shanahan would decide to at least consider the possibility of taking the job.

And here's where it could get interesting. Depending on the language of his contract with the Broncos, Shanahan possibly could go to Gainesville and keep the full amount of the $7 million he's owed in 2010 and 2011 from Denver owner Pat Bowlen.

A source familiar with NFL coaching contracts explains that the money owed to a fired coach often is subject to reduction based on various types of future employment. Some contracts state that the compensation from any other coaching job reduces the buyout obligation on a dollar-for-dollar basis. Other contracts specify that the buyout will shrink based on money from any other "football related" job, which arguably includes money earned in broadcasting.

But some coaching contracts make the buyout obligation applicable to NFL coaching jobs only.

If Shanahan's contract contains that term, he'd be able to collect the $14 million and keep the full amount of any money paid to him at Florida or any other college program. This would potentially close the gap -- for the first two years -- between the available budget in Gainesville and the money that Redskins owner Daniel Snyder would be willing to pay.

Though the precise terms of Shanahan's contract aren't known, it's our understanding that the contract contains some favorable terms regarding the amount of the buyout, even if Shanahan takes another NFL job. And given that he signed his final Denver extension at a time when no one envisioned that he'd be fired by owner Pat Bowlen, we wouldn't be surprised to learn that Shanahan was careful to load all sorts of beneficial language into the buyout clause.

So keep an eye on this one -- there's a chance that the Broncos contract tilts the field heavily in favor of the Gators, if they choose to jump into the bidding for Shanahan, who has not committed to the Redskins even though the Redskins essentially have committed to him.

Originally Posted by Denver Native (Carol)

No, since he is now employed, Bowlen does not owe him 7 mil/yr, but 3.5 mil/yr according to the article.

3.5 for two more years equals 7. C'mon Carol...

[QUOTE=LawDog;876161]3.5 for two more years equals 7. C'mon Carol... [/QUOTE

One of us is apparently not understanding the other one

[QUOTE=Denver Native (Carol);876187]

Originally Posted by LawDog

3.5 for two more years equals 7. C'mon Carol... [/QUOTE

One of us is apparently not understanding the other one

Okay, I said Bowlen owes him 7 million on top of the 35 he will get from Snyder for a total of 42 over the next 5 years. The 7 comes as 3.5 each of the next two years. I never said that Bowlen owes him 7 a year (at least not now that Mikey has signed with Washington).

Am I missing something?