2011-12 NHL RFA Compensation and Rules

Could Drew Doughty be an offer sheet target? (Icon SMI)

The start of NHL free agency on Friday was shaping up to be an interesting time, but best of luck to any GM looking to overhaul his roster on July 1.  Teams have been scrambling to secure talent in recent days before players have a chance to cash in on the open market, leaving just Brad Richards and a handful of scraps for the desperate.

A weak group of unrestricted free agents could open the door for offer sheets to restricted free agents, a tactic rarely used by GM’s to this point under the new CBA.

CapGeek.com has a list of all potential RFA’s, headlined by franchise players such as Steven Stamkos and Drew Doughty. [Note: Shea Weber and Zach Parise are not eligible for offer sheets because their teams have elected arbitration.  They are free to continue negotiations with their respective teams but cannot be traded.]

We recently took a look at the Steven Stamkos situation and how ownership issues and cap space could become a factor as rumors swirl that the Philadelphia Flyers are a suitor.

Doughty will also be looking for a big salary bump from LA Kings GM Dean Lombardi and Richard Pollock over at IllegalCurve.com had a great breakdown of the potential for an offer sheet to Winnipeg defenseman Zach Bogosian.

Restricted free agents are currently free to negotiate with other NHL teams to gauge interest but cannot sign an offer sheet until noon on Friday.  RFA’s are also able to accept qualifying offers tendered by their respective clubs at that time. [Note: Qualifying offers expire on July 15 at 5pm]

After a player has signed an offer sheet and submits the necessary paperwork, his prior club has seven days to exercise its Right to First Refusal and match the terms of the offer sheet.  There can be no conditions or contingencies in the offer sheet and a player cannot be traded once an offer sheet has been signed.

If the prior club declines its Right to First Refusal, it will be entitled to draft pick compensation based on the annual annual value of the new deal.  This is determined by dividing total compensation by the less of the number of years of the offer sheet, or five (this discourages long-term offer sheets in some cases).

The criteria for RFA draft pick compensation in 2011-12 is as follows:

  • $1,034,249 annual cap hit or less: No compensation
  • $1,034,249 — $1,567,043: Third-round pick
  • $1,567,043 — $3,134,088: Second-round pick
  • $3,134,088 — $4,701,131: First and third-round pick
  • $4,701,131 — $6,268,175: First, second and third-round pick
  • $6,268,175 — $7,835,219: Two first-round picks, a second and third
  • $7,835,219 and higher: Four first-round picks

Teams submitting offer sheets must have the necessary draft picks outlined above and the picks must be their own (cannot be from other teams).  It is possible to have multiple signed offer sheets on the table at once as long as the team has the appropriate draft picks.

Other requirements on draft pick compensation:

  • 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).

Mike Colligan

Mike Colligan

Managing Editor
Mike Colligan is an NHL analyst at Forbes SportsMoney and The Hockey Writers. Email: MJColligan@gmail.com
Mike Colligan

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