How do the Colts Structure Contracts?

Joel Corry, a former NFL agent, wrote a piece a few days ago for CBS.com about the most common contract types in the NFL and then went team-by-team looking at which type each team typically utilizes when structuring their contracts.  It's a very interesting and informative article, which you can read here.

Here's what Corry wrote about the Colts and how they structure contracts:

Indianapolis Colts: The Colts mostly structure deals with signing bonuses and base-salary guarantees. Whether the second-year base salary is fully guaranteed at signing depends on the player's contract leverage. Gosder Cherilus' contract triggered an obscure salary cap rule, the 50 Percent Down Rule, because his second-year base salary ($1 million in 2014) was less than half his first year base salary ($5.5 million in 2013). The $4.5 million difference between the two salaries is being treated as signing bonus and prorated over his five-year deal ($900,000 annually).

Corry writes that the Colts usually structure their contracts with signing bonuses and base-salary guarantees, and he gave some information as to what that means:

Signing bonus and salary guarantees

Guaranteed money with this structure consists of a signing bonus and salary guarantees. The base salary in the first contract year is usually fully guaranteed (injury, salary cap and skill guarantees) at signing. Roster bonuses in the first contract year due a few days after signing are fairly common. Even though these roster bonuses technically aren't guaranteed, they are considered as a part of the guaranteed money. Salary guarantees in subsequent contract years are mainly base salary. Some teams will fully guarantee the second-year base salary at signing.

The trend is for base salaries after the first contract year to be conditionally guaranteed. They are guaranteed for injury only initially but fully guaranteed if a player is on the team's roster on a specified date in each specific contract year. This date will vary from team to team but is normally within the first few days of the current league year (i.e.; 2015 base salary becomes guaranteed on third day of the 2015 league year). Early roster bonuses (first day of the league year) in subsequent contract years containing guarantees aren't as common as the base salary guarantees but operate in a similar manner.

A majority of salary guarantees have offset language. An offset clause reduces the guaranteed money a team owes a player when he is released by the amount of his new deal with another team. Without an offset, the player receives his salary from the team that released him as well as the full salary from his new contract with another club.

This type of contract does give out significant guaranteed money that is usually generated from the player being on the roster past a specified date, in addition to the signing bonus that a player receives.  The way the Colts and Ryan Grigson tend to structure contracts will become much more significant as they approach contracts for players such as Andrew Luck and T.Y. Hilton, as the Colts will need to get creative with their cap space.  The way the Colts structured the contracts of players this offseason shows that they're aware of and preparing for those contracts in the future.  You can't really judge which one of the contract types a team uses as "right" or "wrong," it's more just interesting and gives some more insight as to how a team structures their contracts.  Ultimately, the team hopes that the focus won't be on the type of contract given to a player but rather the player the contract is given to, as usually the only time we really focus on a contract is if the player isn't living up to it.

To read Joel Corry's thoughts on the way the other NFL teams structure their contracts and the other types of contract structures, check out the entire article here.