CHAPEL HILL - North Carolina football coach Butch Davis' announced $291,000 raise, along with a one-year contract extension, appears to negate some of his financial incentive to stay at UNC for the long term.

In the new deal, the university will pay Davis money that under the old deal would have only been paid to him after five years on the job. It amounts to more than half of the annual raise -- $157,000 per year. The deal was signed by Davis on Wednesday and released Friday.

When the raise was first announced in November, it came as Davis' name was circulating as a possible target for the head coaching job at Arkansas, his alma mater. Davis says he's at UNC for the long term. He led the Tar Heels to a 4-8 finish this past season, his first at UNC.

Davis will average $2.2 million per season for the entire seven-year deal.

Under the old contract, $100,000 per year was to be paid into a deferred compensation account for the first five seasons, then $300,000 in each of the next two. Now, he's getting a special bonus for every year he stays, instead of lump sums if he stays five, then seven, seasons.

The new deal amounts to a $200,000 per year increase in his pay if he stays for the entire length of the contract.

His annual pay increase is closer to $300,000 in the early years.

"The difference is, the retention bonus that was in the old contract was accumulated and paid out in intervals," athletic director Dick Baddour said. "So what we did is decided to pay that on an annual basis if he's here through June 30 of every year."

If Davis chooses to leave UNC without cause and takes another coaching position, he will still owe the school a penalty ranging from $2 million in the first year down to $700,000 by the final year of his contract. His new contract runs through Jan. 15, 2015.

The only other change to his deal: If the Tar Heels are invited to participate in an ACC first- or second-choice non-BCS bowl game, Davis will receive a bonus of two-months base pay instead of one. That matches what the university basketball coaches are getting.

"This [extension] was of paramount importance for stability in this program that has not enjoyed that over the years, and we absolutely believe we have the right fit," Baddour said.

The new deal had sparked some controversy in the university community, including criticism of the amounts Davis will be paid. Baddour and university trustees say they are keeping up with the market in a competitive field.