Watkins will earn a base salary of $9 million in 2020, per Paylor. He can earn up to $16 million via incentives.
The Clemson product joined Kansas City in 2018 after three years with the Bills and one year with the Rams. Watkins caught 52 passes for 673 yards last season, finding the end zone three times.
Watkins came through in the clutch for Kansas City as they won Super Bowl LIV over the 49ers in February. He caught five passes for 98 yards, turning in a second straight strong performance after catching seven passes for 114 yards in the AFC Championship.
The Chiefs won their first Super Bowl since January 1970 last season. They enter 2020 looking to become the first back-to-back champions since the Patriots in 2003-04.
Analysis from Arrowhead Report: Watkins wanted to stay in Kansas City and the Chiefs wanted to keep him around, but his $21 million cap hit was untenable. Now, in this incentive-heavy one-year deal, the Chiefs get some much-needed salary cap breathing room and Watkins gets to stay in an offense that will help him continue to shine before hitting free agency again next offseason.
For the Chiefs, this deal solves two big issues: Watkins's cap hit and his injury concerns. The Chiefs will pay him at a $9 million price tag that will only rise up towards the $16 million maximum if Watkins stays healthy, performs well and helps get the Chiefs to the AFC Championship game for a third consecutive season. The Chiefs have spent this offseason giving out one-year deals, which will help them maintain flexibility in 2021 and beyond as they continue to work on a long-term deal with franchise-tagged DT Chris Jones and eventually seek to make quarterback Patrick Mahomes the highest-paid player in the history of the sport.