Should we sign Gordon to an Evan Longoria-type contract?

[iamshack]

Slow Sunday morning here, so hoping to generate some discussion here.

 

Here are the terms of Evan Longoria's contract with the Rays that he signed shortly after coming up last season:

 

Evan Longoria 3b

6 years/$17.5M (2008-13), plus 2014-16 club options

signed extension with Tampa Bay 4/18/08

08:$0.5M, 09:$0.55M, 10:$0.95M, 11:$2M, 12:$4.5M, 13:$6M, 14:$7.5M club option ($3M buyout), 15:$11M club option, 16:$11.5M club option

if Longoria otherwise would be arbitration-eligible

after 2010, 2011 salary increases to $2.5M

after 2011, buyout for 2014 option increases to $4M

 

club must decide by 11/2014 whether to exercise 2015-16 options

2016 option may increase to $14M based on rankings in MVP vote

award bonus: $50,000 for All Star selection

 

contract purchased by Tampa Bay 4/12/08

 

drafted 2006 (1-3) (Long Beach St.)

$3M signing bonus

agent: Paul Cohen

 

ML service: 0.170

 

There are obvious advantages and disadvantages to such a contract. The risks involved include performance and injury. Gordon could theoretically prove to be a flash in the pan, the League could make adjustments to him which he has difficulty in turn adjusting to, or he could become an injury-prone player. I believe the risk of any of these things happening is slim to none. Gordon seems to be a player that makes adjustments well, has a seriously impressive learning curve, and has a mental and emotional makeup to be a future all star.

 

The advantages of such a contract are numerous. Should Gordon perform as though he looks capable of, continuing to improve and for the most part, avoiding serious injury, a deal like this would save the club tens of millions of dollars over the term of the deal by locking in what will most-likely be below-market salary figures for Gordon's arbitration years. By paying Gordon more up-front, they can save money on the back-end of the deal. Additionally, adding option years onto the deal which are substantial for the player, yet most-likely below-market in the future protects the Club against Beckham leaving via FA while he is in the prime of his career.

 

My guess is something similar to this contract would appeal to Gordon.

 

Thoughts?

Edited August 9, 2009 by iamshack

[Kyyle23]

I am for it. Everything I have seen indicates to me that he is the Real Deal. locking him up through all of those ridiculous arbitration years is very beneficial to the club and gives the player security as well.

[RME JICO]

How many games had Longoria played before signing that contract?

 

I am sure the Sox would be all for that, but I am not sure Beckham would do it. Longoria has to be regretting it now.

[iamshack]

How many games had Longoria played before signing that contract?

 

I am sure the Sox would be all for that, but I am not sure Beckham would do it. Longoria has to be regretting it now.

 

Longoria had 7 days of MLB service time at the time the deal was agreed to.

 

Andrew Friedman even claimed that they were going to approach Evan with this deal while he was still playing in AAA for the Durham Bulls. It just so happened that Willy Aybar was injured and Longoria had to be called up.

[JorgeFabregas]

How many games had Longoria played before signing that contract?

 

I am sure the Sox would be all for that, but I am not sure Beckham would do it. Longoria has to be regretting it now.

7 or so.

[Kalapse]

Would Gordon go for this though? Longoria signed his deal before he had proven a damn thing at the major league level and because of this he only got $17.5M guaranteed. Ryan Braun on the other hand had 619 AB and a .970 OPS under his belt when he signed his 8 year $45M deal in May of '08. Now Gordon obviously hasn't proven as much as Braun had when he got his deal but he has shown a whole hell of a lot more than Longoria. The guaranteed money would seemingly have to be more than what Longoria got.

 

Braun's deal:

 

8 years/$45M (2008-15)

signed extension with Milwaukee 5/15/08, replacing 1 year/$0.455M contract for 2008 renewed 3/2/08

$2.3M signing bonus

08:$0.455M, 09:$0.745M, 10:$1M, 11:$4M, 12:$6M, 13:$8.5M, 14:$10M, 15:$12M

may earn additional $6M if Braun qualifies as a Super 2 after 2009 season (increasing salaries to: 10:$3.5M, 11:$5.5M, 12:$7.5M, 13:$9M)

award bonus: $50,000 for All Star selection

no-trade clause 2008-11, limited no-trade clause 2012-13 (may block deals to 12 clubs), limited no-trade clause 2014-15 (may block deals to 6 clubs)

[iamshack]

Would Gordon go for this though? Longoria signed his deal before he had proven a damn thing at the major league level and because of this he only got $17.5M guaranteed. Ryan Braun on the other hand had 619 AB and a .970 OPS under his belt when he signed his 8 year $45M deal in May of '08. Now Gordon obviously hasn't proven as much as Braun had when he got his deal but he has shown a whole hell of a lot more than Longoria. The guaranteed money would seemingly have to be more than what Longoria got.

 

Braun's deal:

 

8 years/$45M (2008-15)

signed extension with Milwaukee 5/15/08, replacing 1 year/$0.455M contract for 2008 renewed 3/2/08

$2.3M signing bonus

08:$0.455M, 09:$0.745M, 10:$1M, 11:$4M, 12:$6M, 13:$8.5M, 14:$10M, 15:$12M

may earn additional $6M if Braun qualifies as a Super 2 after 2009 season (increasing salaries to: 10:$3.5M, 11:$5.5M, 12:$7.5M, 13:$9M)

award bonus: $50,000 for All Star selection

no-trade clause 2008-11, limited no-trade clause 2012-13 (may block deals to 12 clubs), limited no-trade clause 2014-15 (may block deals to 6 clubs)

 

The main difference between Braun's deal and Longoria's deal is that the last two years of Longoria's deal are club options, whereas they are guaranteed for Braun. Otherwise, they are remarkably similar in construction and value. Obviously, the fact that Tampa holds club options is extremely valuable for the club in case of some sort of catastrophic injury. My guess is the actual risk of that, however, is minimal. The overwhelming odds are that Tampa will exercise those options, making the contracts not so dissimilar.

 

However, that is an important difference.

 

The best approach is probably to begin with Longoria's contract and negotiate with Beckham's agent. Perhaps a compromise would be one where the White Sox guarantee one of those option years and keep another as a club option.

[Kalapse]

The main difference between Braun's deal and Longoria's deal is that the last two years of Longoria's deal are club options, whereas they are guaranteed for Braun. Otherwise, they are remarkably similar in construction and value. Obviously, the fact that Tampa holds club options is extremely valuable for the club in case of some sort of catastrophic injury. My guess is the actual risk of that, however, is minimal. The overwhelming odds are that Tampa will exercise those options, making the contracts not so dissimilar.

 

However, that is an important difference.

 

The best approach is probably to begin with Longoria's contract and negotiate with Beckham's agent. Perhaps a compromise would be one where the White Sox guarantee one of those option years and keep another as a club option.

Well, there's a huge difference. The Rays have 3 option years accounting for $27M that Evan can earn but that money is in no way guaranteed so if some horrible fate were to befall Longoria in the next few years the Rays are out $17.5M compared to the $45M the Brewers would have to payout if Ryan Braun had his arm ripped off by a bear tomorrow (I assume insurance would cover this but you get the point). That's a substantial difference in guaranteed money and monetary risk. There's a $28M difference in guaranteed money thanks to a complete lack of option years in Braun's deal.

[elrockinMT]

It's early yet

Edited August 9, 2009 by elrockinMT

[Kalapse]

It's early yet

Actually the whole point is that it is early. If you wait too long you increase the amount of guaranteed money that must be included in the deal. The Rays sign an extension with Longoria 7 days into his big league career and get him for 9 years at $17.5M guaranteed, meanwhile the Brewers wait a year and have to shell out $45M, wait another year and Beckham's camp may not be interested in an extension given how close he'd be to arbitration. The idea is to lock him up real early in his career so you save a good amount of money and extend the time in which he's under your control and in return you're guaranteeing a young man financial security to last the remainder of his life.

[iamshack]

Well, there's a huge difference. The Rays have 3 option years accounting for $27M that Evan can earn but that money is in no way guaranteed so if some horrible fate were to befall Longoria in the next few years the Rays are out $17.5M compared to the $45M the Brewers would have to payout if Ryan Braun had his arm ripped off by a bear tomorrow (I assume insurance would cover this but you get the point). That's a substantial difference in guaranteed money and monetary risk. There's a $28M difference in guaranteed money thanks to a complete lack of option years in Braun's deal.

 

Well, that is pretty much what I stated in my post about some "catastrophic injury."

 

My guess is, as you stated, such an event could be covered by insurance, making this difference fairly negligible.

 

The more concerning difference, I would argue, would be the fact that those option years are not guaranteed against poor performance.

 

Where would you put the odds that, if Longoria stays reasonably healthy, and avoids some catastrophic injury, that the Rays end up picking up the options? In other words, what do you think the probability is that Longoria's performance causes the Rays (or some other team he is possibly traded to) to exercise those options?

[Kalapse]

Well, that is pretty much what I stated in my post about some "catastrophic injury."

 

My guess is, as you stated, such an event could be covered by insurance, making this difference fairly negligible.

 

The more concerning difference, I would argue, would be the fact that those option years are not guaranteed against poor performance.

 

Where would you put the odds that, if Longoria stays reasonably healthy, and avoids some catastrophic injury, that the Rays end up picking up the options? In other words, what do you think the probability is that Longoria's performance causes the Rays (or some other team he is possibly traded to) to exercise those options?

Well, of course the odds are good but the risk is still there. Regardless of how great he looks right now I see a tremendous difference between guaranteeing an extra $28M to a player in his early 20's and offering that same money in he form of club options. Even great young players flame out and because of this the Rays are in a much better situation than the Brewers IMO.

[iamshack]

Well, of course the odds are good but the risk is still there. Regardless of how great he looks right now I see a tremendous difference between guaranteeing an extra $28M to a player in his early 20's and offering that same money in he form of club options. Even great young players flame out and because of this the Rays are in a much better situation than the Brewers IMO.

 

Which begs the following question:

 

Should Beckham's agent refuse to agree to a long-term deal such as Longoria's, instead asking for one such as Braun's, is it still in the best interests of the White Sox to sign Gordon to this type of contract?

 

The White Sox sign Gordon to an 8 year, $39 million deal, the same as Longoria's, except with the 2015 - 2017 option years guaranteed at $7.5, $11, and $11.5 million guaranteed respectively.

[Kalapse]

Which begs the following question:

 

Should Beckham's agent refuse to agree to a long-term deal such as Longoria's, instead asking for one such as Braun's, is it still in the best interests of the White Sox to sign Gordon to this type of contract?

 

The White Sox sign Gordon to an 8 year, $39 million deal, the same as Longoria's, except with the 2015 - 2017 option years guaranteed at $7.5, $11, and $11.5 million guaranteed respectively.

Well for starters Longoria's deal is worth $44M over the next 8 not $39M and Gordon will not earn a year of service this year so things are slightly different. If you're asking me if I'd sign Gordon to a 9 year, $44.5M deal today ('10: $.5M, '11: $.55M, '12: $.95M, '13: $2M, '14: $4.5M, '14: $6M, '15: $7.5M, '16: $11M, '17: $11.5M) I'd probably lean towards no. There really needs to be an option or 2 in there.

 

*this is insignificant but I feel I must mention it; the '10, '11 and even the '12 salaries would obviously have to be a little higher than that, probably $550K, $600K and $1M.

[iamshack]

Yeah, I understand that. I'm not trying to so much as duplicate Longoria's contract, but rather the concept of it.

 

I agree, however, I think at least one of those 8-figure years needs to be an option year. I think I would approach Beckham with the same concept of the Longoria deal, but perhaps more guaranteed. 6 year $22 million with 2 club option years in the 8 figures ($10 and $12 million), taking out that first club option that offers the $7 million or whatever. So all in all, the contract would be 6/$22 with the potential to become 8/$44 should the club option years be exercised.

[Kalapse]

Yeah, I understand that. I'm not trying to so much as duplicate Longoria's contract, but rather the concept of it.

 

I agree, however, I think at least one of those 8-figure years needs to be an option year. I think I would approach Beckham with the same concept of the Longoria deal, but perhaps more guaranteed. 6 year $22 million with 2 club option years in the 8 figures ($10 and $12 million), taking out that first club option that offers the $7 million or whatever. So all in all, the contract would be 6/$22 with the potential to become 8/$44 should the club option years be exercised.

I do agree with you, don't get me wrong. Low to mid 20's guaranteed is definitely doable. Though the fact that Beckham is still 6 years away from free agency after this year does muck things up a bit, ideally it would be a 9 year deal that pays him a little over $2M the first 3 years ('10-'12) to account for pre-arb then around $13M over the next 3 to account for arbitration and then like Longoria $30M or so to buyout his first 3 years of free agency with one of those seasons being guaranteed and the other 2 being club option years that need to be exercised simultaneously. A decent signing bonus somewhere around $2.3M could be in order.

[iamshack]

I do agree with you, don't get me wrong. Low to mid 20's guaranteed is definitely doable. Though the fact that Beckham is still 6 years away from free agency after this year does muck things up a bit, ideally it would be a 9 year deal that pays him a little over $2M the first 3 years ('10-'12) to account for pre-arb then around $13M over the next 3 to account for arbitration and then like Longoria $30M or so to buyout his first 3 years of free agency with one of those seasons being guaranteed and the other 2 being club option years that need to be exercised simultaneously. A decent signing bonus somewhere around $2.3M could be in order.

 

This is exactly the reason I was hoping you would respond to this thread.

 

It's fairly clear that Gordon is exceptional in terms of both physical talent as well as mental/emotional makeup. The kid has rocketed through our minor league system, experiencing major league pitching for the first time and mashing it, and learning a new position on the fly.

 

One of the keys to me has been how he has handled his struggles in the field. The kid has made plenty of errors trying to learn the speed and angles over at third, and yet, he doesn't let it get him down. He doesn't take it to the plate with him. He has also been moved up in the order. He just takes absolutely everything we throw at him in stride.

 

I'm all in favor of locking Gordon up long term. He has the "it" factor. Sign him up and get an insurance policy against catastrophic injury, and I think we take a lot of future stress out of our equation.

Edited August 9, 2009 by iamshack

[Kalapse]

This is exactly the reason I was hoping you would respond to this thread.

 

It's fairly clear that Gordon is exceptional in terms of both physical talent as well as mental/emotional makeup. The kid has rocketed through our minor league system, experiencing major league pitching for the first time and mashing it, and learning a new position on the fly.

 

One of the keys to me has been how he has handled his struggles in the field. The kid has made plenty of errors trying to learn the speed and angles over at third, and yet, he doesn't let it get him down. He doesn't take it to the plate with him. He has also been moved up in the order. He just takes absolutely everything we throw at him in stride.

 

I'm all in favor of locking Gordon up long term. He has the "it" factor. Sign him up and get an insurance policy against catastrophic injury, and I think we take a lot of future stress out of our equation.

One of the things they always talk about with young players that get fat extensions early in their careers is complacency and like you said he seems to be as mentally strong and competitive as anyone, so that wouldn't worry me in the least. I really think Gordon's camp and Rick Hahn will get to talking in the near future, I really see no reason not to.

[elrockinMT]

Kalapse mention that Beckham is under Sox control for another six years (if I read that right and understand the rules correctly). Why commit now when we can see what things bring in maybe 3 years and then sign the long term deal?

[Balta1701]

Kalapse mention that Beckham is under Sox control for another six years (if I read that right and understand the rules correctly). Why commit now when we can see what things bring in maybe 3 years and then sign the long term deal?

Because you gain yourself significant cost certainty by committing now rather than gambling on where the arbitration process is going to go, you potentially buy out those arbitration years more cheaply than you could 3 years down the road, and you're much more likely to be able to buy out a year or two of FA at this point than 3 years down the road.

 

You're trading the player increased financial security at a young age in exchange for 1 or 2 years of FA. It's a good deal for your team as long as the player doesn't get hurt.

[chw42]

I'd do it this off-season.

 

The economy's bad right now and it should get better in the future, meaning he will be looking for more money once he hits arbitration and gets close to free agency. I think it's worth it.