Matt Maiocco was the first to report that Vernon Davis is absent from this week’s OTAs because he’s unhappy with his contract situation. At first glance, Davis doesn’t appear to be underpaid. According to Maiocco, his average annual salary of $7.35 million through 2015 is third among tight ends behind Rob Gronkowski ($8 million) and Jason Witten ($7.4 million). However, the contract was front-loaded and Davis is scheduled to make $5.3 million (before forfeiting some money for missing workouts) in 2014 and $4.9 million in 2015.
Ian Rapoported that the 49ers have known about Davis’ desire for a new deal since February. Fantex offered 421,100 shares of “Vernon Davis” at $10 per share in February.
Davis was paid $4 million by Fantex, who then gets a 10% stake in Davis’ “brand.” David Fucillo of Niners Nation explained the arrangement back in February (emphasis mine).
The value in this will come as Vernon Davis continues his career, on and off the field. As I understand it, the price of the stock can gain and lose value based on what Vernon is doing through his playing and post-playing career. If he signs a huge new contract anytime soon, that’s a big boost on that value. If he retires and then signs a deal with a major network to serve as a commentator, more value. His current Jamba Juices are not a part of this, but if he opens any new Jamba Juice stores, that’s more value. Of course, if he is arrested, or he struggles to find certain post-career earnings opportunities, the value could go down.
Fantex aside, it’s by no means surprising that Davis would want to restructure his deal now for a couple reasons.
First, he’s in a great negotiating position. He’s coming off a 13-touchdown season, the tight end they drafted in the second round a year ago hasn’t yet proven that he can be an effective receiving option, and the 49ers didn’t do much to bolster the position during this past offseason.
Second, if Davis lets his current deal play out, he’ll head into free agency as a 32-year-old tight end. So a “market value” extension now might be his best chance at one last big contract. Davis has suffered two known concussions since the end of 2012, which could also factor into his thinking (although injury risk can always be stated as a potential reason to strive for more guaranteed money whenever the opportunity to do so arises).
It makes sense that Davis would be the first player to take the plunge with Fantex. With his outside business interests (and just plain interests, as it seems like he’s putting on art shows on a near-weekly basis), he’s as diversified as a football player gets. But this is a new scenario where a player isn’t just responsible for the financial wellbeing of himself and his family. Davis, like any publicly traded corporation, now has a group of investors (and Fantex) to answer to.
The 49ers know this, but it isn’t their problem. And with Alex Boone holding out for arguably better reasons (his annual salary ranks 40th among guards), an extension potentially on the horizon for Colin Kaepernick, along with other key players including Michael Crabtree and Mike Iupati set to become free agents after this season, it’s unclear whether they have the cap space to make Davis happy.
One thing is Davis’ favor here could be that $4 million payout from Fantex. Losing $200K here or there for missing workouts isn’t a concern for him right now, he’s more interested in making a long-term investment in himself.