DETAILS ABOUT OFFER SHEETS

    Since we're coming up on the 2008-09 offseason and the topic of offer sheets is bandied about like a tennis ball at Wimbledon, I've provided a page that should cover everything you need to know on the subject.  [Updated for '08-09 estimated compensation limits]

-- WHAT IS AN OFFER SHEET?
    An Offer Sheet is simply a Standard player Contract negotiated by the player and a Club which is not the one the one the player is currently a member of.  The terms of the offer sheet are agreed to by both parties, and both sides must sign the Offer Sheet for it to be valid.

-- WHO CAN GET AN OFFER SHEET?
    Any Restricted Free Agent not currently signed to an SPC who has not accepted his qualifying offer, has not filed for arbitration, or has not been taken to arbitration by his Club may be signed to an offer sheet.  If a player is going to arbitration, he cannot get signed to an offer sheet by another team.

-- WHEN CAN OTHER TEAMS TALK TO RESTRICTED FREE AGENTS?
    Starting on June 26 and until the player is signed by his Club, files for arbitration, or is taken to arbitration by his Club, other Clubs may talk to Restricted Free Agents.  However ... once the player meets one of the three criteria above, he cannot contact other Clubs, nor may other Clubs contact him.

-- WHEN IS AN OFFER SHEET VALID?
    An offer sheet is valid only when both the team and the player have signed it.  Teams can tender offer sheets to players, but if the player does not sign it then the offer sheet is null and void.  In other words, no team has to worry about matching an offer sheet given to one of its Restricted Free Agents unless the player signs it.

-- WHAT HAPPENS WHEN A PLAYER SIGNS AN OFFER SHEET?
    Once a player signs an offer sheet, the team ("New Team") giving the offer will submit it to Central Registry and must also notify the player's original team ("Prior Team") of the offer sheet.  The Prior Team has seven (7) days from the date it receives the offer sheet to choose whether to accept the terms of the offer sheet or decline.  If they choose to accept, then the salary, signing bonuses (if any), and reporting bonuses (if any) in the Offer Sheet become a binding SPC on both the Prior Team and the player.  If they decline, then all of the terms specified in the Offer Sheet become binding on the New Team and the player and the Prior Team receives compensation from the New Team as set forth below.

-- CAN THE PRIOR TEAM TRADE THE PLAYER'S RIGHTS IF HE SIGNS AN OFFER SHEET?
    NO!  From Article 10.3(a),
        Once an Offer Sheet for a Restricted Free Agent has been received by the Prior Club, the Prior Club may not Trade or otherwise Assign its Right of First Refusal for such Restricted Free Agent.

-- IF THE TEAM MATCHES, CAN THEY TURN AROUND AND TRADE THE PLAYER?
    Again, no.  From Article 10.3(b),
        The Prior Club may not Trade that Restricted Free Agent for a period of one year from the date it exercises its Right of First Refusal.

-- WHAT IS THE COMPENSATION REQUIRED FOR SIGNING A RFA TO AN OFFER SHEET?
    For 2008-09, the estimated compensation due for signing a RFA to an Offer Sheet is:

    The amount is determined by taking the total compensation due in the Offer Sheet, and dividing by the number of years specified in the Offer Sheet, or five (5) - whichever is less.  [The actual numbers will be released by the NHL on or around June 30.]

    Example:  A team signs a RFA to an offer sheet which calls for salaries of $4 million in Years 1 and 2, and $5 million in Years 3 to 5.  The average amount for compensation purposes is $4.6 million ($23 million divided by 5 years) - so the compensation required in 2008-09 would be a 1st, 2nd, and 3rd round pick.

    Example:  A team signs a RFA to an offer sheet which calls for a salary of $3.5 million per year for 6 years.  Even though the Averaged Salary on the offer sheet would be $3.5 million, for compensation purposes the average amount is $4.2 million ($21 million divided by the lesser of the number of years on the offer sheet, or 5) - so the compensation due in 2008-09 would be one 1st's, one 2nd, and one 3rd round pick.

MISCELLANEOUS
-- The numbers in the table above change at the same rate as the change in the Average League Salary.
-- Teams must use their own draft picks for the purpose of compensation, including picks that were traded and later reacquired.  They cannot use draft picks acquired from other teams (which were not originally theirs) to offer as compensation.
-- A team can have multiple offer sheets active, provided it has the necessary draft picks available to offer as compensation.
-- From Article 10.4,
      -- Clubs owing one (1) draft selection must have it available in the next draft.
      -- Clubs owing two (2) draft selections in different rounds must have them available in the next draft.
      -- Clubs owing three (3) draft selections in different rounds must have them available in the next draft.
      -- Clubs owing two (2) draft selections in the same round, must have them available in the next three (3) drafts.
      -- Clubs owing three (3) draft selections in the same round must have them available in the next four (4) drafts, and so on.

      When a Club owes two (2) or more draft selections in the same round, the signing Club does not elect the years in which such selections shall be awarded to the Prior Club; rather, the selections next available will be transferred to the Prior Club (i.e., a Club that owes two (2) selections has them available in the next two (2) drafts – that is when they are transferred).

 QUESTIONS

Q: Can the Prior Team negotiate a contract with the player after he signs an Offer Sheet?
A: No - the terms of the Offer Sheet constitute the basis for a Standard Player Contract.  It's just a matter of which team is going to be bound by them - so the Prior Team can't decide it wants to strike a salary and contract length different from what was proposed in the Offer Sheet.

Q: Can the New Team void or take back an Offer Sheet that a player signed?
A: No - from Article 10.3(d),
        (ii)         An Offer Sheet, once signed by the Player and the New Club, shall be irrevocable.

Q: How is the Offer Sheet counted for salary cap purposes?
A: While the Offer Sheet is valid and the Original Team has not elected to match, the Averaged Salary implied by the terms of the Offer Sheet is charged against the Upper Limit of the New Team - if the New Team does not have sufficient payroll room before filing the Offer Sheet with Central Registry, it will be rejected and the New Team may be charged with a violation of Article 26 for attempting to circumvent the salary cap.

Q: My team has our 1st this year plus a 1st from someone - can we use their pick to sign a guy to an offer sheet needing 2 first-round picks and just use that other 1st we have as part of the compensation package?
A:  Absolutely not!  Again ... teams must offer their own (original) picks, they can't offer someone else's picks they've acquired.

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