Term:
Six-year Agreement with mutual option for a seventh year.
HRR Accounting:
Current HRR Accounting subject to mutual clarification of existing interpretations and settlements.
Applicable Players' Share:
For each of the six (6) years of the CBA (and any additional one-year
option) the Players' Share shall be Fifty (50) percent of Actual HRR.
Payroll Range:
Payroll Range will be computed using existing methodology. For the
2012/13 season, the Payroll Range will be computed assuming HRR will
remain flat year-over-year (2011/12 to 2012/13) at $3.303 Billion
(assuming Preliminary Benefits of $95 Million).
2012/13 Payroll Range…
Lower Limit = $43.9 Million
Midpoint = $51.9 Million
Upper Limit = $59.9 Million
Appropriate "Transition Rules" to allow Clubs to exceed Upper Limit
for the 2012/13 season only (but in no event will Club's Averaged Club
Salary be permitted to exceed the pre-CBA Upper Limit of $70.2 Million).
Cap Accounting:
Payroll Lower Limit must be satisfied without performance bonuses.
All years of existing SPCs with terms in excess of five (5) years
will be accounted for and charged against a team's Cap (at full AAV)
regardless of whether or where the Player is playing. In the event any
such contract is traded during its term, the related Cap charge will
travel with the Player, but only for the year(s) in which the Player
remains active and is being paid under his NHL SPC. If, at some
subsequent point in time the Player retires or ceases to play and/or
receive pay under his NHL SPC, the Cap charge will automatically revert
(at full AAV) to the Club that initially entered into the contract for
the balance of its term.
Money paid to Players on NHL SPCs (one-ways and two-ways) in another
professional league will not be counted against the Players' Share, but
all dollars paid in excess of $105,000 will be counted against the NHL
Club's Averaged Club Salary for the period during which such Player is
being paid under his SPC while playing in another professional league.
In the context of Player Trades, participating Clubs will be
permitted to allocate Cap charges and related salary payment obligations
between them, subject to specified parameters. Specifically, Clubs may
agree to retain, for each of the remaining years of the Player's SPC, no
more than the lesser of: (i) $3 million of a particular SPC's Cap
charge or (ii) 50 percent of the SPC's AAV ("Retained Salary
Transaction"). In any Retained Salary Transaction, salary obligations as
between Clubs would be allocated on the same percentage basis as Cap
charges are being allocated. So, for instance, if an assigning Club
agrees to retain 30% of an SPC's Cap charge over the balance of its
term, it will also retain an obligation to reimburse the acquiring Club
30% of the Player's contractual compensation in each of the remaining
years of the contract. A Club may not have more than two (2) contracts
as to which Cap charges have been allocated between Clubs in a Player
Trade, and no more than $5 million in allocated Cap charges in the
aggregate in any one season.
System Changes:
Entry Level System commitment will be limited to two (2) years
(covering two full seasons) for all Players who sign their first SPC
between the ages of 18 and 24 (i.e., where the first year of the SPC
only covers a partial season, SPC must be for three (3) years).
Maintenance of existing Salary Arbitration System subject to: (i)
total mutuality of rights with regard to election as between Player and
Club, and (ii) eligibility for election moved to five years of
professional experience (from the current four years).
Group 3 UFA eligibility for Players who are 28 or who have eight (8)
Accrued Seasons (continues to allow for early UFA eligibility -- age
26).
Maximum contract length of five (5) years.
Limit on year-to-year salary variability on multi-year SPCs -- i.e.,
maximum increase or decrease in total compensation (salary and bonuses)
year-over-year limited to 5% of the value of the first year of the
contract. (For example, if a Player earns $10 million in total
compensation in Year 1 of his SPC, his compensation (salary and bonuses)
cannot increase or decrease by more than $500,000 in any subsequent
year of his SPC.)
Re-Entry waivers will be eliminated, consistent with the Cap
Accounting proposal relating to the treatment of Players on NHL SPCs
playing in another professional league.
NHL Clubs who draft European Players obtain four (4) years of
exclusive negotiating rights following selection in the Draft. If the
four-year period expires, Player will be eligible to enter the League as
a Free Agent and will not be subject to re-entering the Draft.
Revenue Sharing:
NHL commits to Revenue Sharing Pool of $200 million for 2012/13
season (based on assumption of $3.303 Billion in actual HRR). Amount
will be adjusted upward or downward in proportion to Actual HRR results
for 2012/13. Revenue Sharing Pools in future years will be calculated
proportionately.
At least one-half of the total Revenue Sharing Pool (50%) will be
raised from the Top 10 Revenue Grossing Clubs in a manner to be
determined by the NHL.
The distribution of the Revenue Sharing Pool will be determined on an
annual basis by a Revenue Sharing Committee on which the NHLPA will
have representation and input.
For each of the first two years of the CBA, no Club will receive less in total Revenue Sharing than it received in 2011/12.
Current "Disqualification" criteria in CBA (for Clubs in Top Half of
League revenues and Clubs in large media markets) will be removed.
Existing performance and "reduction" standards and provisions
relating to "non-performers" (i.e., CBA 49.3(d)(i) and 49.3(d)(ii)) will
be eliminated and will be adjusted as per the NHL's 7/31 Proposal.
Supplemental and Commissioner Discipline:
Introduction of additional procedural safeguards, including ultimate
appeal right to a "neutral" third-party arbitrator with a "clearly
erroneous" standard of review.
No "Rollback"
The NHL is not proposing that current SPCs be reduced, re-written or
rolled back. Instead, the NHL's proposal retains all current Players'
SPCs at their current face value for the duration of their terms,
subject to the operation of the escrow mechanism in the same manner as
it worked under the expired CBA.
Players' Share "Make Whole" Provision:
The League proposes to make Players "whole" for the absolute
reduction in Players' Share dollars (when compared to 2011/12) that is
attributable to the economic terms of the new CBA (the "Share
Reduction"). Using an assumed year-over-year growth rate of 5% for
League-wide revenues, the new CBA could result in shortfalls from the
current level of Players' Share dollars ($1.883 Billion in 2011/12) of
up to $149 million in Year 1 and up to $62 million in Year 2, for which
Players will be "made whole." (By Year 3 of the new CBA, Players' Share
dollars should exceed the current level ($1.883 Billion for 2011/12) and
no "make whole" will be required.)
Any such "shortfalls" in Years 1 and 2 of the new CBA will be
computed as a percentage reduction off of the Player's stated
contractual compensation, and will be repaid to the Player as a Deferred
Compensation benefit spread over the remaining future years of the
Player's SPC (or if he has no remaining years, in the year following the
expiration of his SPC). Player reimbursement for the Share Reduction
will be accrued and paid for by the League, and will be chargeable
against Players' Share amounts in future years as Preliminary Benefits.
The objective would be to honor all existing SPCs by restoring their
"value" on the basis of the now existing level of Players' Share
dollars.
• • •
The final section here is a key one: Deferring payment on current
contracts. Will the NHLPA actually trust the League to come through?
Donald Fehr responded to the offer in a letter to the players,
as revealed by TSN's Bob McKenzie, including this bit on the last section:
"The proposal includes a "Make Whole" provision, to
compensate players for the anticipated reduction in absolute dollars
from last year (2011-12), to this year and next year. However, it would
work like this. The Players Share in subsequent years would be reduced
so that this "Make Whole" payment would be made. It is players paying
players, not owners paying players. That is, players are "made whole"
for reduced salaries in one year by reducing their salaries in later
years."
