CBA Question: Signing Bonuses of Contracts Signed Under Old CBA

Discussion in 'The Business of Hockey' started by discostu, Aug 25, 2005.

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  1. discostu

    discostu Registered User

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    There is some confusion on the Sens board, in terms of how the some of the old contracts will be handled.

    Specifically, Alfredsson signed a contract under the old CBA that paid him a $7.5 million signing bonus over and above a $25 M, 5 year deal. Problem is, no one really knows if this signing bonus is amortized over the life of the contract under the new CBA or not.

    Does anyone have any information on how this is handled under the current CBA. It's something that can mean quite a bit of difference to the CBA. Does it count against the cap, or not? If it does, how much is actually applied against the cap, the actual dollar amount, or the 24% rollbacked amount?

    Has anyone heard anything on how something like this would be handled. I'm sure the Sens aren't the only ones with such a contract. Any help is appreciated.
     
  2. Egil

    Egil Registered User

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    Now THAT is a good question. Many of the old quirky contracts are sortof grandfathered in. Its possible were in better cap shape then we think though. $5 mil a year is considerably less after the rollback.

    As a guess, they will count signing bonus as salary in the year it is paid. I doubt Alfie's signing bonus was all paid in the first year.
     
  3. kdb209

    kdb209 Registered User

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    My guess is that any previously paid signing bonuses, and any frontloaded contracts paid out before the lockout DO NOT count against the cap. The reports have been pretty clear, for players on existing multi-year deals, the cap hit was the average of REMAINING dollars on the contract over the remaining years.

    So unless Alfies signing bonus was structured as to actually be paid over multiple years (and still had a balance to be paid), then it would not count against Ottawa's cap.
     
  4. Captain Ron

    Captain Ron Registered User

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    On NHLPA.com they list Alfredsson's salary this year as $4,662,894.

    Pre-rollback that would be $6,135,387 / year. So it is safe to say that at least some of the bonus is being paid over time.
     
  5. discostu

    discostu Registered User

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    That's part of our problem, none of us can figure out how that $4.6 M is derived. By our calculations, it should be either $4.94 M (with the bonus), or, it should be $3.8 million. Maybe it's due to part of the bonus being paid, but we're getting frustrated, as there is no definitive answer to how that number is derived.
     
  6. Egil

    Egil Registered User

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    I'm pretty sure that the salary for each year is different, so $4.6 sounds alot like the bonus is included. Having said that, the TSN numbers are all based on the Dec 9th proposal from the NHLPA, so who knows what is going on.
     
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