hatterson
Registered User
My guess is that capgeek has the specifics of this contract incorrect.
From Section 50.7(b)
(emphasis in original)
Given that the contract is not front loaded by the CBA definition (nor any other sane definition) it seems blatantly outside of this clause and thus not valid, hence my assumption that capgeek has something incorrect.
If the first year was raised to 1.15M and the second reduced to 2.3M the AAV would be identical and the contract would then be valid.
Edit: In regards to the 50% you referenced, that's only for front loaded deals. Having a contract go 1M, 2M, 3M, 4M, 5M, 6M, 7M would be legal however 7M, 6M, 5M, 4M, 3M, 2M, 1M would not.
Front loaded SPCs (first half has higher value than second half) two things must hold:
- Years immediately adjacent cannot vary more than 35% from the value of the first year of the deal; and
- No year may be less than 50% of the highest year
Non front loaded deals have different rules:
- The first two years must not be different by more than the amount of the smaller year (ie, the larger of the first two years can be at most double the smaller)
For years beyond the first 2:
- Any increase from one year to another must not exceed the smaller of the first two years
- Any decrease from one year to another must not exceed 50% of the smaller of the first two years.
That means if the first year of the deal is $1 million the maximum year to year increase in the deal can be $1 million and the maximum year to year decrease can be $500k
There are no requirements on non-front loaded deals that each year be within a certain percent of the maximum.
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