The Los Angeles Rams will have many difficult personnel and financial decisions to make this offseason. One of those decisions centers on whether or not to exercise OLB Alec Ogletree’s fifth-year option.
January 4th marked the first day of the fifth-year option exercise period for first round selections from the 2013 NFL Draft. For the team to exercise the option, it must give written notice to the player no earlier than January 4, 2016, and no later than May 2, 2016.
What is a “fifth-year option”? Every player selected in the first round of the NFL Draft will automatically have a fifth-year team option added into his contract. This option cannot be separately attached to the player contract. The option allows a team to retain a player’s rights for five years rather than four, which is the bonus of selecting a player in the first round. The fifth-year option is non-negotiable, and the non-compensation terms from a player’s rookie contract will also be included in the fifth-year option.
What are the fifth-year option compensation terms for players selected outside the top ten picks in the first round of the NFL Draft?
From the 2011 NFL/NFLPA Collective Bargaining Agreement:
(f) Fifth-Year Option for All Other Selections in Round One.
(i) For any other Drafted Rookie selected in round one, the Paragraph 5
Salary for the player’s Fifth-Year Option shall equal an amount that would apply in the
fourth League Year of the Rookie Contract if one calculated the Transition Tender for
that League Year by using the same methodology as set forth in Article 10, Section 4, but
using the applicable third through twenty-fifth highest Salaries (as “Salary” is defined in
Article 10) (as opposed to the ten highest Salaries) for players at the position at which
the Rookie participated in the most plays during his third League Year.
Because Ogletree was selected outside the top ten picks in the first round (30th), his 5th year option is calculated using the third through twenty-fifth highest salaries for all linebackers in 2016. If the Rams do indeed exercise Alec Ogletree’s 5th year option, it would cost them $8.82 million against the salary cap in 2017.
There are numerous ways the Rams can handle the Alec Ogletree contract situation:
- The Rams can decline to exercise Ogletree’s fifth-year option, let him play out the final year of his rookie contract (2016) and allow him to become a Free Agent in 2017 (without attempting to re-sign him).
- The Rams can decline to exercise Ogletree’s fifth-year option and attempt to sign him to a long-term contract before he becomes a Free Agent in 2017.
- The team can exercise the fifth-year option and attempt to sign him to a long-term contract before he becomes a Free Agent in 2018.
- The team can exercise the fifth-year option and attempt to sign him to a long-term contract before the option year becomes fully guaranteed (which occurs if Ogeltree’s on the 2017 opening day active roster).
Is the $8.82 million cost associated with exercising Alec Ogletree’s fifth-year option too steep a price to pay for securing his services for an additional year? Do the Rams take the big risk of potentially losing him to Free Agency after only four seasons with the team if they don’t exercise the option?
How much is he really worth to the Rams?