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  1. #151
    Jerseys need purple
    aragorn's Avatar
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    Quote Originally Posted by Troy_Ice View Post
    Agent would have almost certainly negotiated that a larger percentage of his contract be in signing bonuses instead of salary and that it be paid earlier. They also would have front loaded the salary into the early years of the deal so he gets more of his money sooner. Signing bonuses get paid 1) irrespective of a lockout and 2) on July 1 rather than throughout the year.

    Compare Drew's structure to Tavares. They both get a contract that averages $11m (its 7 vs 8 years).

    Tavares gets $15.9m the first two years, and then it decreases throughout the rest of the term. Of the $77m over $70m is in signing bonuses (thats ~90%). He gets this money whether there is a lockout or not. In the lockout years $18.1 of the ~$20m he is owed is paid in signing bonuses--he will get his money whether they play or not.

    DD gets exactly $11m a year after the first two in which he gets $12m then $10 in the second year. Only $20m of $88m is signing bonus, but crucially in the lockout years only $4m of the $22m he is due is in the form of signing bonuses. (there is $0 in signing bonus in 22-23 which seems to me like the most likely lockout only because I cant imagine them trying to bring Seattle into the league and then having a lockout just a year after).

    Drew gets his money later in the year, and if there is a lockout he gets much less if any of it. He also has to wait longer to get his money both over the course of the contract and during each year.
    Did Kopitar get that or was his agent a dunce? Maybe Drew got the exact same deal as Kopi?

  2. #152
    RANGZ
    aaron's Avatar
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    Drew almost certainly would have benefited from an agent. He had all the leverage.
    Not getting strictly bonus money in lockout years was a major mistake. Could cost him $5M.
    Not getting full nmc.
    Not front loading probably cost him several million in value.
    These were easy gets that wouldn't have hurt "the team" in the slightest

  3. #153
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    Troy_Ice's Avatar
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    Kopi's agent is the same as Tavares.

    Kopi's deal was heavily front loaded-as much as the CBA allows. It started at $14m and the last two years are at $7m. He'll have received $50 of his $80m before the first potential lockout year. And he had /has a no movement clause that protects/ed him from expansion for the first 4 years of his deal and a limited no trade the last four years. So, with respect to terms, it was a much smarter deal.

    Finally, regarding salary, I'm doing this in my head so it will be off a touch, but 11 got about 13.5% of the cap, while DD got about 12.5%

  4. #154
    Don't Make Me Destroy You
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    How can we fit Erik Karlsson into our salary cap now

  5. #155
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    Quote Originally Posted by crapola View Post
    How can we fit Erik Karlsson into our salary cap now
    Simply trade Stevens for cap relief.

  6. #156
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    I'm just glad they gave dollars to Doughnuts.

  7. #157
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    Some may find this of interest. It's a deep evaluation showing how contract structure can be important. Looks like by using signing bonuses Tavares may have saved himself $12 million in taxes.

    https://www.forbes.com/sites/seanpac.../#2f08df701ab7

  8. #158
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    Quote Originally Posted by Troy_Ice View Post
    Some may find this of interest. It's a deep evaluation showing how contract structure can be important. Looks like by using signing bonuses Tavares may have saved himself $12 million in taxes.

    https://www.forbes.com/sites/seanpac.../#2f08df701ab7
    That article was a very high overview of basic strategy and the only bit relating to the singing bonus assumes they are to be paid regardless of lockout. My understanding is they are due typically to be paid on a certain day following the turn of the season. Should that day fall before the potential lockout they should be paid. Its unclear however the specific dates pertinent to Tavares contract. Ideally there is no loss of games in the looming lockout in which case it would have been a moot point. In any case I am in no way a tax or cap guru and managed to know this. Simply put getting the team to agree to pony up cash in event of a lockout is probably a great trick, but the mechanics of it are pretty simple.

  9. #159
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    Importantly, the article also makes the point that whether you take payment in the form of signing bonuses can have significant tax implications for some players.

    In every case i can recall, SBs are paid on July 1. But even if it is later during the summer it is still potentially an additional benefit. So in addition to potentially providing lockout protection they also pay players their money earlier in the year. Over multiple seasons that can be a significant benefit. Finally, I have read in some places that signing bonuses cannot be bought out. If true they go a long way to ensuring that a larger proportion of one's contract is actually guaranteed

  10. #160
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    Quote Originally Posted by jammer06 View Post
    That article was a very high overview of basic strategy and the only bit relating to the singing bonus assumes they are to be paid regardless of lockout. My understanding is they are due typically to be paid on a certain day following the turn of the season. Should that day fall before the potential lockout they should be paid. Its unclear however the specific dates pertinent to Tavares contract. Ideally there is no loss of games in the looming lockout in which case it would have been a moot point. In any case I am in no way a tax or cap guru and managed to know this. Simply put getting the team to agree to pony up cash in event of a lockout is probably a great trick, but the mechanics of it are pretty simple.
    Also to clarify, yes, you have the process correct. The CBA is set to expire on September 15 in the years it can be ended. So the point of the signing bonuses is to deliver to the players (a large percentage of) their money before that date in order to protect that income from the lockout.

    You're also right its not *that* complicated but despite this, many players and agents don't take advantage of it. Perhaps many players don't have the leverage to pressure teams to do that. But I also suspect that this is one of those issues that seems obvious only after the really smart agents have raised the issue and insured their players against the lockout. Similarly, many players, even prominent ones (e.g., OEL, DD), do not have their salaries front loaded even though this also seems like an obvious way to insure against buyout (and get them use of their money sooner).

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