Contracts

[kylerap]

Salaries

Contract Restructures:
There are no contract restructures allowed since players can be bought out or not kept at end of the year.


Buyouts:
Buyouts are allowed. With this you take the full cap hit of releasing a player all in one season.
To find the value of a buyout, you take the cap hits for dropping a player in season (90/60/30% of the contract) and add them all up and multiply it by 1.25.

Example-
John Smith, $10.0m 2024
To drop him in 2022 in season it would be cap hits of 9.0, 6.0, 3.0m. Add those together for $18.0m and multiply by 1.25= 22.5m. This $22.5m cap hit would all apply to the 2022 cap. This is a steep penalty, but if the team has the cap room they can use it that year instead of potentially non-keeping the player and getting that cap hit applied.

Buyouts must be completed by August 31 of each year.


Contract Extensions:
Players can be extended in the final year of their contract only.
Extensions must be at least 25% of their salary when extending.
Example- Chase Headley, $13.0m 2018 has an extension value of $2.0m, then his salary must be at least 25% of $13.0m which equals $3.3m.


Prospect contracts:
A player can be signed to a prospect contract as long as they have under 50 innings pitched or 130 at bats in the majors. The contract will be 500k per year once they either pass those limits or are promoted to your major league roster. They won't count against the cap as long as the player remains in your minors.

Once a prospect has accumulated 50 innings pitched or 130 at bats, his service time clock will be started. If this occurs in 2022 season, the player would remain p-n/a for the remainder of the season before his contract was updated to p-2025. This means that he is under control for 3 more seasons (2023-2025) at a 500k salary. Prospects can be extended at any time following the extensions guidelines for Prospect contracts.

A player on a prospect contract may be cut at any time without penalty, although signing bonuses are fully guaranteed and stay with winning team for remainder of that year.


Variable contracts:
Variable contracts are allowed for free agents and extensions. The salary must remain within 25% of the annual amount.
Example - Miguel Cabrera is signed to a 50m contract.� This averages out to 5 years for $10.0m per year.
25% means the lowest per year it can go is $7.5m and highest is $12.5m.� An example here would be frontloading the deal looking like: $7.5m, $7.5, $10.0, $12.5, $12.5m, which still equals $10m annually on average.

[tomviolence]

updated to remove options as that only applied at time of start up draft.