ARTICLE 10: FREE AGENCY
10.1 Unrestricted Free Agents.
(a) Group 3 Players and Free Agents.
(i) For (A) the 2005-06 League Year, any Player who is 31 years of age or older and has four (4) Accrued Seasons as of June 30 of the end of the 2004-05 League Year, (B) the 2006-07 League Year, any Player who either has eight (8) Accrued Seasons or is 29 years of age or older as of June 30 of the end of the 2005-06 League Year, (C) the 2007-08 League Year, any Player who either has seven (7) Accrued Seasons or is 28 Years of age or older as of June 30 of the end of the 2006-07 League Year, and (D) the 2008-09, 2009-10, 2010-11 League Years, any Player who either has seven (7) Accrued Seasons or is 27 years of age or older as of June 30 of the end of the 2007-08, 2008-09, 2009-10 League Year, as the case may be, and in either case has four (4) Accrued Seasons or more on June 30 of the end of the applicable League Year, shall, if his most recent SPC has expired, with such expiry occurring either as of June 30 of the applicable League Year or June 30 of any prior League Year, become an Unrestricted Free Agent. Such Player shall be completely free to negotiate and sign an SPC with any Club, and any Club shall be completely free to negotiate and sign an SPC with such Player, without penalty or restriction, or being subject to any Right of First Refusal, Draft Choice Compensation or any other compensation or equalization obligation of any kind.
(ii) An Unrestricted Free Agent shall not be subject to any limitations on the period of time before which he may qualify as an Unrestricted Free Agent again, or to any limitations on the number of times he may become an Unrestricted Free Agent, except for a Group 5 Player, who may only elect to become a Group 5 Player once, but who may qualify to be another type of Unrestricted Free Agent in accordance with the terms of this Agreement.
(b) Group 5 Free Agents.
(i) Means any Player who has completed ten (10) or more professional seasons (minor league or NHL seasons, but excluding any season in Major Juniors), and who did not earn in the final year of his SPC more than that year's Average League Salary, provided that such Player has not previously elected to become an Unrestricted Free Agent pursuant to the terms of Section 10.1(b)(ii) below or the terms governing Group 5 Free Agents in any collective bargaining agreement preceding this Agreement. For the purposes of the foregoing, the term "professional season" shall: (A) for a Player aged 18 or 19, mean any season in which such Player plays in eleven (11) or more Professional Games (including NHL Regular Season and Playoff Games, minor league regular season and playoff games, and games played in any European professional league, while under an SPC), and (B) for a Player aged 20 or older, mean any season in which such Player plays in one or more Professional Games (including NHL Regular Season and Playoff Games, minor league regular season and playoff games, and games played in any European professional league, while under an SPC).
(ii) Any Group 5 Player shall be entitled at the expiration of his SPC to elect to become an Unrestricted Free Agent by notifying in writing the League and his Prior Club, in accordance with Exhibit 3 hereof, of such election on or before July 10 (or such other date as may be agreed in an applicable critical date calendar agreed to by the League and the NHLPA) of the League Year in which such Player qualifies to become a Free Agent pursuant to this subsection. Upon making such election, such Player shall be completely free to negotiate and sign an SPC with any Club, and any Club shall be completely free to negotiate and sign an SPC with such Player, without penalty or restriction, or being subject to any Right of First Refusal, Draft Choice Compensation or any other compensation or equalization obligation of any kind.
(c) Group 6 Free Agents.
(i) Means any Player who is age 25 or older who has completed three (3) or more professional seasons, whose SPC has expired and: (i) in the case of a Player other than a goaltender, has played less than 80 NHL Games, or (ii) in the case of a goaltender, has played less than 28 NHL Games (for the purpose of this definition, a goaltender must have played a minimum of thirty (30) minutes in an NHL Game to register a game played). For the purposes of the foregoing, the term professional season shall: (A) for a Player aged 18 or 19, mean any season in which such Player plays in eleven (11) or more Professional Games (including NHL Regular Season and Playoff Games, minor league regular season and playoff games, and games played in any European professional league, while under an SPC), and (B) for a Player aged 20 or older, mean any season in which such Player plays in one or more Professional Games (including NHL Regular Season and Playoff Games, minor league regular season and playoff games, and games played in any European professional league, while under an SPC).
(ii) Any Group 6 Player shall, at the expiration of his SPC, become an Unrestricted Free Agent and shall be completely free to negotiate and sign an SPC with any Club, and any Club shall be completely free to negotiate and sign an SPC with such Player, without penalty or restriction, or being subject to any Right of First Refusal, Draft Choice Compensation or any other compensation or equalization obligation of any kind.
(d) Draft Related Unrestricted Free Agents.
(i) Any Player not eligible for claim in any future Entry Draft pursuant to this Agreement and not on a Club's Reserve List shall be an Unrestricted Free Agent. Further, any Player eligible for claim in the Entry Draft, but who was unclaimed, shall be an Unrestricted Free Agent subject to the provisions of Section 8.9(b).
(ii) Each Player referred to in subsection (d)(i) above shall, during the period of his Free Agency in accordance with Section 8.9(b), if applicable, be completely free to negotiate and sign an SPC with any Club, and any Club shall be completely free to negotiate and sign an SPC with such Player, without penalty or restriction subject to the provisions of Article 9 of this Agreement, if applicable, and without being subject to any Right of First Refusal, Draft Choice Compensation or any other compensation or equalization obligation of any kind.
10.2 Restricted Free Agents.
(a) Group 2 Players and Free Agents.
(i) (A) Any Player who meets the qualifications set forth in the following chart and: (1) is not a Group 1 Player or a Group 4 Player, and (2) is not an Unrestricted Free Agent, shall be deemed to be a "Group 2 Player" and shall, at the expiration of his SPC, become a Restricted Free Agent. Any such Player shall be completely free to negotiate and sign an SPC with any Club, and any Club shall be completely free to negotiate and sign an SPC with any such Player, subject to the provisions set forth in this Section. As used in this Section 10.2, "age," including "First SPC Signing Age" means a Player's age on September 15 of the calendar year in which he signs an SPC regardless of his actual age on the date he signs such SPC.
First SPC Signing Age Eligible for Group 2 Free Agency
18 - 21 3 years professional experience
22 - 23 2 years professional experience
24 or older 1 year professional experience
For the purposes of this Section 10.2(a), a Player aged 18 or 19 earns a year of professional experience by playing ten (10) or more NHL Games in a given NHL Season, and a Player aged 20 or older (or who turns 20 between September 16 and December 31 of the year in which he signs his first SPC) earns a year of professional experience by playing ten (10) or more Professional Games under an SPC in a given League Year.
(B) Notwithstanding the foregoing, if a Group 2 Player requests salary arbitration, or a Club requests salary arbitration, pursuant to Article 12, such Player will not be eligible to negotiate with any Club other than his Prior Club or sign an Offer Sheet pursuant to this Article 10, except as provided in Section 12.10.
(ii) In order to receive a Right of First Refusal or Draft Choice Compensation (at the Prior Club's option) with respect to a Restricted Free Agent, the Prior Club of a Restricted Free Agent must tender to the Player, no later than 5:00 p.m. New York time on the later of June 25 or the first Monday after the Entry Draft of the final year of the Player's SPC, a "Qualifying Offer", which shall be an offer of an SPC, for one League Year, which is subject to salary arbitration if such Player is otherwise eligible for salary arbitration in accordance with Section 12.1, on at least the following terms and conditions:
(A) if the Player's prior year's Paragraph 1 NHL Salary is less than or equal to $660,000 for that League Year, 110% of the prior year's Paragraph 1 NHL Salary.
(B) if the Player's prior year's Paragraph 1 NHL Salary is greater than $660,000, but less than $1,000,000 for that League Year, 105% of his prior year's Paragraph 1 NHL Salary, but in no event to exceed $1,000,000.
(C) if the Player's prior year's Paragraph 1 NHL Salary is equal to or greater than $1,000,000 for that League year, 100% of the prior year's Paragraph 1 NHL Salary.
(D) if a Player is eligible to receive a Two-Way Qualifying Offer, the Paragraph 1 Minor League Salary component shall not be less than the higher of the Player's prior year's Paragraph 1 Minor League Salary, if any, or the minimum Minor League salary.
A Qualifying Offer shall not be open for acceptance prior to July 1. If a Qualifying Offer meeting the above requirements is timely made, the Prior Club shall have a Right of First Refusal, exercisable in accordance with Section 10.3 below, or Draft Choice Compensation, exercisable in accordance with Section 10.4 below. A Qualifying Offer will be deemed to have met the above requirements if the Prior Club timely provides the Player a completed copy of the notice attached as Exhibit 19 hereto, in accordance with Exhibit 3 hereto.
(iii) A Club's Qualifying Offer must be a One-Way Qualifying Offer if the applicable Player has: (A) actually played (excluding games missed for injury, illness or disability) 180 or more NHL Games in the previous three (3) NHL Seasons, (B) played at least sixty (60) NHL Games in the previous NHL Season, and (C) not cleared Waivers in the period between the 12th day prior to the commencement of the previous Regular Season and the end of a Club's previous Playing Season. For purposes hereof only, a goaltender is deemed to have played an NHL Game when he was dressed and on the bench as a backup. In all other cases, a Qualifying Offer may be a Two-Way Qualifying Offer.
(iv) In the event a Prior Club fails to make a Qualifying Offer as set forth in this Section 10.2 and fails to elect salary arbitration pursuant to Section 12.3(a), the Player shall immediately become an Unrestricted Free Agent and shall be completely free to negotiate and sign an SPC with any Club, and any Club shall be completely free to negotiate and sign an SPC with any such Player, without penalty or restriction or being subject to any Right of First Refusal, Draft Choice Compensation, or any other compensation or equalization obligation of any kind.
(v) A Qualifying Offer shall automatically expire at 5:00 p.m. New York time on July 15; provided, however, that the Club may by written notice to Central Registry and the NHLPA, sent in accordance with Exhibit 3 hereof, provided on or before 5:00 p.m. New York time on July 15, extend the deadline for Qualifying Offer acceptance to a date (which must be a fixed and definitive calendar date) determined in its sole discretion.
(b) Group 4 Free Agents.
(i) Definition of "Defected Player." For purposes of this Agreement, "Defected Player" means any Player not unconditionally released:
(A) who, having had an SPC with a Club, the provisions of which, including the option clauses in a 1995 SPC, have not been completely fulfilled, contracts for a period including any part of the unfulfilled portion of his SPC, with a club in a league not affiliated with the NHL or with any such league (both of which are hereinafter referred to as an "unaffiliated club") or with any other professional hockey club to the exclusion of the said Club or its assignee; or
(B) who, never having been under contract to any Club, but as to who the NHL negotiation rights now or at any time hereafter shall reside in any Club, has contracted or shall contract with such an unaffiliated club.
(C) A Player who plays out his final season, or option season pursuant to a 1995 SPC, as the case may be, and enters into a contract for a period including the following season with an unaffiliated club or with any other professional hockey club shall not be deemed to be a "Defected Player"; provided, however, that nothing contained in this Section shall be construed to affect the rights of said Club to compensation, if applicable, pursuant to this Article 10 in the event that said Player should subsequently enter into an SPC for his services as a professional hockey player with another Club of the NHL.
(ii) Free Agent Status.
(A) Any such Defected Player shall be deemed to have become a free agent within the meaning of this Agreement, when one of the following conditions (1), (2), (3), (4) or (5) and condition (6) have occurred.
(1) the Player, having become a Defected Player pursuant to Section 10.2(b)(i)(A), has become free of any obligation to such unaffiliated club(s) or such other professional hockey club(s) during the playing season by reason of its default or the dissolution of its league and has not, prior to fourteen (14) days thereafter, entered into a valid SPC for a period which includes the current and/or following season, for his services as a professional hockey player with the Club with which he was last under SPC; or
(2) the Player, having become a Defected Player pursuant to Section 10.2(b)(i)(A), has become free of any obligation to such unaffiliated club(s) or such other professional hockey club(s) during the off season and has not, prior to sixty (60) days thereafter, entered into a valid SPC for a period which includes the current and/or following season for his services as a professional hockey player with the Club with which he was last under SPC; or
(3) the Player, having become a Defected Player pursuant to Section 10.2(b)(i)(B) and having played no more than two (2) full seasons with an unaffiliated club(s), has become free of any obligation to such unaffiliated club(s) during the playing season by reason of its default or the dissolution of its league and has not, prior to fourteen (14) days thereafter, entered into a valid SPC for a period which includes the current and/or following season for his services as a professional hockey player with the Club which last had the NHL rights to negotiate with such Player; or
(4) the Player, having become a Defected Player pursuant to Section 10.2(b)(i)(B), and having played no more than two (2) full seasons with an unaffiliated club(s), has become free of any obligation to such unaffiliated club(s) during the off season and has not, prior to thirty days thereafter, entered into a valid SPC for a period which includes the current and/or following season for his services as a professional hockey player with the Club which last had the NHL rights to negotiate with such Player; or
(5) the Player, having become a Defected Player pursuant to Section 10.2(b)(i)(B) and having played more than two (2) full seasons with an unaffiliated club(s), has become free of any obligation to such unaffiliated club(s); and
(6) the Commissioner makes a determination (which shall be made as promptly as feasible) that he has reason to believe that the conditions described in subparagraphs (1), (2), (3), (4) or (5) have occurred, that he has ascertained the date upon which such Player became free of obligation, and that the Player falls within category (A) or (B) of Section 10.2(b)(i) above, by placing such a Player's name on the Free Agent List (Defected Players) issued as of such time or any amendment of such List, which List, except for the date thereof and except for its application to Defected Players, as defined herein, shall otherwise be issued substantially in accordance with Exhibit 3.
(B) Upon the occurrence of the conditions prescribed by subparagraphs (1), (2) and (3) of Section 10.2(b)(ii)(A), the provisions of this Article 10, as applicable, shall then apply to any such Defected Player as if he had become a free agent at the expiration of his SPC, including, without limitation, the rights and obligations which would be imposed or conferred by the provisions of Sections 10.3 through 10.4 upon a Club signing such a Player and upon a Club with whom a free agent was last under SPC or who owned the NHL rights to negotiate with such Player.
(C) When the Commissioner places such a Player's name on the Free Agent List it shall bear an appropriate notation that the Player has contracted with a club in an unaffiliated league or with any other professional hockey club and that the placing of such a Player's name on the Free Agent List does not constitute any representation that he has fulfilled or will fulfill his obligation to the unaffiliated club or other professional hockey club prior to the commencement of the next season.
(iii) If the Club with which any Player covered by Section 10.2(b)(i) was last under SPC or which owned the NHL rights to negotiate with such Player has properly transferred or assigned or properly transfers or assigns those rights to another Club, then all rights and obligations conferred by this Article 10 upon the Club with which such Player was last under SPC (or, as provided by Section 10.2(b)(i)(C) and Section 10.2(b)(ii), the Club which owned the NHL rights to negotiate with such Player) shall be deemed to have been assumed and acquired thereby by such other Club.
(iv) Application of League By Law Section 15. Anything to the contrary in this Section 10.2(b) notwithstanding, until all of the conditions specified in Section 10.2(b)(ii) have occurred, the Club with which any Player covered by Section 10.2(b)(i) was last under SPC, or in the case of defected Players referred to in Section 10.2(b)(i)(C), the Club which now or hereafter owns, through an NHL Entry Draft or through a proper transfer or assignment from another Club or otherwise, the professional rights or the right to negotiate for said professional rights, shall be deemed to continue to hold such professional or negotiating rights and the provisions of League By Law Section 15 shall be applicable.
(v) Administration and Interpretation. The Club with which the Player was last under SPC or then holding his NHL negotiation rights shall have primary responsibility for acquiring and furnishing information to the Commissioner to assist him in determining the status of any such Player but all Clubs obtaining information with respect thereto shall have the responsibility to furnish such information to the Commissioner for that purpose as promptly as it becomes available from time to time.
(vi) Right of First Refusal, No Draft Choice Compensation.
(A) In order for a Prior Club to obtain a Right of First Refusal for any Group 4 Player who has signed an Offer Sheet, the Prior Club must offer to such Player, in accordance with Exhibit 3 hereto, a Qualifying Offer on or before 5:00 p.m. New York time on the later of June 25 or the first Monday after the Entry Draft of the year he becomes a Group 4 free agent. Such Qualifying Offer must be for at least the Minimum Paragraph 1 Salary and if the Player meets the qualifications for being in the Entry Level System, an SPC for a term corresponding to the Player's age as required under Section 9.1(b) or otherwise one-year SPC.
(B) Provided such Qualifying Offer has been made, the Prior Club shall have a Right of First Refusal in respect of any Offer Sheet received by such Player from a New Club, as per the terms set forth in Section 10.3.
(C) Notwithstanding any provision to the contrary contained in this Agreement, the Prior Club is not entitled to Draft Choice Compensation for the loss of a Group 4 Player.
(c) Players With Fewer Than Three Years of Professional Experience.
Any Player with fewer than the required years of professional experience set forth in Section 10.2 shall have no right to Free Agency except as provided in this section. Upon expiration of such a Player's SPC, the Club to whom the Player was last under SPC shall be entitled to make that Player a Qualifying Offer under the terms and conditions set forth in Section 10.2(a)(ii) above. A Club which makes this Qualifying Offer will have the exclusive right to negotiate with any such Player. In the event no such Qualifying Offer is made, the Player shall immediately become an Unrestricted Free Agent pursuant to Section 10.2(a)(iv) above.
10.3 Offer Sheet and First Refusal Procedures.
(a) When a Restricted Free Agent receives an offer to sign an SPC from any Club (the "New Club") other than his Prior Club, which offer the Player desires to accept, he shall give to the Prior Club, in accordance with Exhibit 3 hereto, a completed certificate substantially in the form of Exhibit 6 attached hereto (the "Offer Sheet"), signed by the Restricted Free Agent and the New Club, which shall contain the "Principal Terms" (as defined below) as well as all other terms of compensation of the New Club's offer. The Prior Club, within seven (7) days after the date it receives the Offer Sheet, may exercise or not exercise its Right of First Refusal, which shall have the legal consequence set forth below. 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.
(b) If the Prior Club gives the Restricted Free Agent and his Certified Agent, if any, notice, in accordance with Exhibit 3 hereto, that it is exercising its Right of First Refusal (a "First Refusal Exercise Notice"), such notice to be substantially in the form of Exhibit 7 attached hereto, to the Player's and his Certified Agent's, if any, address or facsimile number listed on the Offer Sheet, if any, within the seven (7) day period, such Restricted Free Agent and the Prior Club shall be deemed to have entered into a binding agreement, which they shall promptly formalize in an SPC, containing: (i) all the Principal Terms (subject to subsection (e) below); and (ii) such additional terms as may be agreed upon between the Restricted Free Agent and the Prior Club. 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.
(c) If the Prior Club does not give the Restricted Free Agent the First Refusal Exercise Notice within the seven (7) day period, the Player and the New Club shall be deemed to have entered into a binding agreement, which they shall promptly formalize in an SPC, containing all of the terms contained in the Offer Sheet, and the Restricted Free Agent's Prior Club shall receive from the New Club the Draft Choice Compensation, if any, specified in Section 10.4 below.
(d) (i) A Club may have more than one Offer Sheet signed by a Restricted Free Agent outstanding at any one time and from time to time, provided that it has the available draft picks to satisfy its obligations pursuant to Section 10.4 with respect to all Offer Sheets outstanding at the relevant time.
(ii) An Offer Sheet, once signed by the Player and the New Club, shall be irrevocable.
(e) For the purposes of this Article, the Principal Terms of an Offer Sheet are limited to the term, Paragraph 1 Salary and Signing Bonus and Reporting Bonus the New Club offers to the Restricted Free Agent (currently and/or as Deferred Compensation in specified installments on specified dates) in consideration for his services as a hockey Player under the SPC.
(f) All Principal Terms contained in an Offer Sheet shall be fixed and readily determinable amounts of cash, which shall not be subject to any conditions or contingencies whatsoever, except as to the date on which payment is to be made.
(g) Simultaneously with the giving of an Offer Sheet to the Prior Club, the New Club shall give a copy thereof, by facsimile, to Central Registry and the NHLPA, all in accordance with Exhibit 3 hereto. Simultaneously with the giving of a First Refusal Exercise Notice to the Restricted Free Agent, the Prior Club shall give a copy thereof, by facsimile, to the NHL and the NHLPA, all in accordance with Exhibit 3 hereto.
(h) Upon receipt of an Offer Sheet, the Prior Club shall immediately fax to Central Registry, in accordance with Exhibit 3 hereto, a request to encumber the New Club's required draft picks and place them in reserve for the Prior Club. Upon receipt of either a copy of such Offer Sheet or the fax from the Prior Club, Central Registry shall immediately determine whether the New Club's required draft picks are available and unencumbered. If such draft picks are available, the League shall encumber them in reserve for the Prior Club. If the required draft picks are not available and unencumbered, the League shall immediately notify all parties (the Restricted Free Agent, his Certified Agent (if any), the New Club and the Prior Club), all in accordance with Exhibit 3 hereto, and the said Offer Sheet shall be deemed null and void. Upon receipt of any First Refusal Exercise Notice, Central Registry shall immediately release any encumbrance it has placed on the New Club's draft picks.
(i) Subject to the restrictions set forth in Sections 11.4 and 11.6(a)(vi), in the event that any Offer Sheet is determined to be invalid by the Impartial Arbitrator as being in breach of this Agreement, the Restricted Free Agent shall, for a period of seven (7) days from the rendering of such decision by the Impartial Arbitrator, be entitled to the rights of a Restricted Free Agent hereunder, including the right to obtain an Offer Sheet and to elect, or for the Club to elect, salary arbitration (if otherwise eligible for salary arbitration in accordance with Article 12 and the Player, or the Club, as the case may be, still had such right to so elect at the time the Player executed the Offer Sheet).
(j) On or before May 15 of each League Year, the NHL will provide the NHLPA with a draft Free Agent List in its then-current form, which List shall set forth each Player's name and the group(s) of Free Agency he qualifies for (assuming Club were to make a Qualifying Offer) effective as of that July 1. The NHLPA will review the draft Free Agent List and, on or before June 1, will provide the NHL with written notice of any potential disputes concerning the List, providing the details underlying the dispute. The NHL acknowledges that the NHLPA will review and discuss the draft Free Agent List with the Players' Certified Agents in order to collect information relevant to identifying potential disputes. The NHLPA acknowledges that said List is only a draft and that the NHL is free to amend said List in any manner it deems appropriate (which promptly will be sent to the NHLPA) and that said List (and any draft amendments) shall not be used as evidence against, or prejudice in any fashion, the NHL in any matter whatsoever.
(k) When a final version of the Free Agent List is distributed by the League, the League will provide that List to the NHLPA within a reasonable time period after it provides the List to the Clubs, but before it issues a press release setting forth the List, and shall thereafter throughout each League Year promptly issue such bulletins correcting, amending and updating such List as may be necessary to add or delete Players to ensure the accuracy of the Free Agent List on an ongoing basis. Information shall not be selectively withheld for some Players but not others. If one or more Free Agent Lists are so circulated, copies thereof and all amendments and updates thereto shall be sent by the NHL simultaneously to the NHLPA.
(l) The draft Free Agent List and final Free Agent List discussed herein will be distributed to the NHLPA in electronic format, provided the NHLPA will distribute the Lists only to Certified Agents and Players. Certified Agents and Players will not distribute publicly any such Lists, including posting them on any website.
10.4 Draft Choice Compensation for Restricted Free Agents
Any Club that is entitled to but does not exercise its Right of First Refusal pursuant to Section 10.3 shall be entitled to obtain Draft Choice Compensation from the New Club. The number and quality of draft choices due to the Prior Club shall be based on the average annual value of the compensation contained in the Principal Terms (as defined in Section 10.3(e) hereof) of the New Club's Offer Sheet (determined by dividing such compensation by the lesser of the number of years of the Offer Sheet or five), based on the following scale:
GROUP 2 COMPENSATION CHART
OFFER SHEET COMPENSATION
$660,000 or below None
Over $660,000 to $1 million Third Round
Over $1 million to $2.0 million Second Round
Over $2.0 million to $3.0 million First Round and Third Round
Over $3.0 million to $4.0 million First Round, Second Round, and Third Round
Over $4.0 million to $5.0 million Two First Rounds, Second Round, and Third Round
Over $5 million Four First Rounds
The dollar amounts set forth in the scale outlined above shall be increased on an annual basis at the same percentage rate of increase as Average League Salary, with the 2006/07 League Year being the first year such increase shall take effect. By way of example, if the Average League Salary on June 30, 2007 has increased by 10% from the Average League Salary on June 30, 2006, then each of the dollar amounts stated in the table above shall be increased by 10% on June 30, 2007, and the basis for determining the number and quality of draft choices due to the Prior Club for the loss of a Restricted Free Agent signed after such date shall be adjusted accordingly. For each League Year thereafter, a similar comparison and adjustment shall be made. Clubs must use their own draft picks (being those awarded directly to the Club by the League for use by it in the Entry Draft, including such draft picks described in the first clause of this parenthetical that a Club has traded or encumbered, and subsequently reacquired or unencumbered.)
Clubs cannot acquire picks to use as compensation (with the exception being a Club's own draft selections that are traded and then re-acquired).
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).
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