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Donald Stephenson’s Contract Is Set To Void Before 2018

This is knowledge that I’ve mentioned in comments several times over the course of the season, and I should have expounded it in an article like this earlier:  Donald Stephenson’s contract, originally a three year deal from 2016-2018, is now set to void the final year upon the conclusion of the 2017 league year.

Stephenson renegotiated his contract with the Broncos twice during the 2017 offseason, as both sides mutually tried to find common ground away from an untenable status quo. In the first renegotiation, Stephenson’s $4 million 2017 pending base salary guarantee was cut down to $2 million, with the trigger other half delayed until the cutdown to 53 players. When that day in late August drew near, a second renegotiation turned the delayed $2 million guarantee into only $500,000, with the other $1.5 million diverted into snap count incentives. (At only 23.9% of the snaps as of after Week 15, it’s highly unlikely he’ll meet those.)

But while Nicki Jhabvala mentioned in that citation to the second negotiation that his “$4 million salary for 2018 is now gone”, what wasn’t mentioned is the method as to how that was wiped out. Over The Cap later discovered that it was accomplished via voiding that year altogether, as illustrated by the unusual $0 base salary now listed in his contract page.

What does this mean?

  • The Broncos are completely relieved of Stephenson’s $4 million base salary that they previously held as a liability against the 2018 cap.
  • The Broncos will incur only $1 million of dead money from Stephenson against the 2018 cap, coming from his original $3 million signing bonus.
  • Stephenson’s contract will now expire in 2018 instead of 2019, making him an unrestricted free agent at the start of the 2018 league year. There is no need for the Broncos to terminate his contract via cutting him.
  • However, this renegotiation will unfortunately make it highly unlikely that Stephenson will qualify for consideration toward 2019 compensatory picks. This is because contracts that are shortened from voids via renegotiation are seen as a form of circumvention that the comp pick formula interprets more as a termination than expiration, which makes good common sense.
  • There is nothing stopping the Broncos and Stephenson from coming to agreement on an extension before he officially becomes a free agent, though in my opinion I see that option as highly unlikely.