Free Money Giveaway

The New York Giants recently signed fourth-round draft choice running back Andre Brown, according to ProfootballTalk.com, and is giving away free money. 

Brown reportedly received a signing bonus totaling $433,000. Provided he makes the final roster of the New York Giants, his minimum salary (Paragraph 5) for 2009 will be $310,000 on top of the already guaranteed signing bonus. Furthermore, his minimum Paragraph 5 salaries will be $400,000, $490,000, and $580,000 for the subsequent years of 2010, 2011, and 2012 respectively.

It has also been reported via Profootballtalk.com, Brown has included in his contract incentives totaling $130,000 each year. All together, his total contract is worth approximately $2.2 million.

Assuming Brown has an executed standard representation agreement (SRA) with a sports agent that pays the sports agent at a rate of three percent (3%); his sports agent will receive compensation in the amount of $66,000.

Again, assuming Brown has not done so, he could have negotiated between himself and his sports agent, that the sports agent not be paid on the minimum salaries of his contract but instead only on the signing bonus and incentives the sports agent negotiated for on behalf of Brown. By adding Brown’s four-year minimum Paragraph 5 salaries in aggregate, the amount comes to $1.78 million. Brown would have saved himself over $53,000 in fees paid to his sports agent. This is money he could have saved and put to use for himself.  Remember, the minimum salaries for NFL players have already been negotiated on their behalf by the NFLPA.

With that much money up for grabs for agents, there is no wonder many aspire to become sports agents, due to the very lucrative personal payoff and the very little added value for the athlete.

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