Zach Allen agrees to four-year, $102 million contract extension with Broncos, sources say

DENVER — Sean Payton approached Zach Allen on Thursday with what he thought was a promising metaphor.

“It appears the ships can see each other on the horizon,” the Broncos head coach said, referring to contract extension talks between the club and Allen’s camp.

Then Payton asked Allen how far the horizon is at sea.

“His answer bothered me. He said 20 miles,” Payton said. “It’s eight miles.”

Allen went home and Googled it.

“At the high point of a cruise ship, it can be 20 miles,” Allen said Saturday. “It depends on the ship.”

This could all be lighthearted recounting now, given the sides on Saturday finalized a four-year extension that sources told The Denver Post is worth $102 million. The deal features $69.5 million in guarantees, makes Allen the third-highest-paid interior defensive lineman by average annual value in the NFL, and ties him to the franchise through the 2029 season.

Still, a now-humorous anecdote can be instructive as to why these types of negotiations can be so tricky.

Even on seemingly simple facts, perspectives vary widely depending on your angle.

Allen and the Broncos overcame those differences through a tough negotiation because, at the end of the day, they all wanted No. 99 to stay in Denver for years to come.

“Periodically, there’s a player that comes up and you say to yourself, ‘If we’re not willing to pay him, then who are we paying?’ ” Payton said.

Indeed, Allen started an elite run of play in the middle of the 2023 season and then authored a 2024 campaign that solidified his place as a foundational player for this franchise.

He led the NFL with 40 quarterback hits. He led all interior defensive linemen with 67 pressures and finished the season with 8.5 sacks. Allen dominated in big moments, lined up primarily inside, but showed the ability to play all over the defensive front and became a leader for one of the league’s best defensive units.

He showed that ability even on the day he actually signed the deal.

Allen didn’t do much early in practice Saturday as the final details were put on the deal, then he retreated into the facility midway through to sign his paperwork.

When he returned to the practice field, he briefly got loose on the sideline, jumped into the action and made a terrific play in which he staved off All-Pro right guard Quinn Meinerz with one arm and lassoed rookie running back RJ Harvey with the other.

That’s the kind of play the Broncos have become accustomed to with the 2019 third-round pick out of Boston College.

Even as well as defensive coordinator Vance Joseph knew Allen when he first signed with the Broncos in the spring of 2023 — Allen played for Joseph in Arizona the first four years of his career — and as much as Payton thought he had room to grow, they could not have seen this ascension into elite status coming.

That turned the offseason into a unique negotiating period for both sides. The Broncos had several other players entering contract seasons, too, and Allen earned the right to ask for top-of-the-market money.

Allen, like receiver Courtland Sutton, could have opted to hold out and not report to training camp when a deal didn’t materialize in the first three weeks of July.

Instead, though, Allen told his agent he wanted no animosity. He said he wanted “the best deal possible, but I care about these people and this place and I don’t want it to get ugly.”

“I just love what we’re building here,” Allen added. “I just can’t state that enough. It’s all about the culture here, and I think that’s kind of why you kind of see how Courtland and myself, how everything was handled. We believe in this team and believe in this organization.”

It didn’t hurt, Allen added, that he had somebody going through a similar situation in Sutton.

“We were going through very similar things and I said this on a podcast, Courtland’s one of the greatest people I’ve ever met in my life,” Allen said. “… To have a guy like that who’s going through the same thing, bounce ideas, keep you sane with it — because there are days when it’s kind of tough — is huge.”

In the end, they signed their four-year extensions five days apart.

Those deals are the continuation of a busy 13 months for the Broncos, who have locked up several key players to long-term contracts. The list: Allen, Sutton, NFL Defensive player of the year CB Pat Surtain II, OLB Jonathon Cooper, LT Garett Bolles and All-Pro right guard Quinn Meinerz. Those deals came with a total of $306 million in guarantees, a major spending spree to solidify the core of Payton’s roster for the coming years.

The extensions for Sutton and Allen should clear room on the Broncos’ 2025 cap given that they carried the second and third-highest cap figures on the team at $20.2 million and $19.75 million, respectively. That will likely allow the team to convert 2025 base salary into mostly signing bonus and prorate out the rest of the bonus money, creating cap flexibility in the short term.

Before the extensions, Denver already had $12.6 million in cap space, according to OvertheCap. So they’ll have plenty of flexibility to get more deals done if they want to and they’ll be in position to roll over a substantial amount of cap space to 2026.

Now Allen’s focus turns to continuing to find ways to elevate his game in 2025. He had a scary thought for opposing offenses as he spoke with reporters Saturday.

“I have an obsession about this,” Allen said. “You can talk to anybody in this building. I’m not trying to toot my own horn, but I love this. This is my life. I take a lot of pride in this and I take it seriously. Every single day — the season ended and it was finding ways to get better. Every year, I am getting better.

“Right now, I’m way ahead of schedule of where I was last year.”