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Originally Posted by cpayne5
I agree. Canuck, what will this do to our immediate cap situation?
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I posted this previously, here is your answer:
So, the question is what happens next? I'm a financial analyst, so I'll hit you with the salary cap ramifications: Coles signed a 7-year deal with a $13 million bonus, meaning that bonus counts $1.857 million against the cap each year of the deal. He's played out 2 years of the deal, so the unallocated portion of his bonus would amount to 5 year's worth, or $9.286 Million. If he gives back all of that $9.286 Million, his bonus will clear off of the books, and his cap number in 2005 will decrease by $1.857 million. Plus we won't be paying him his base salary of $1.5 million, so that would go to savings, meaning we would save a total of $3.357 million in 2005.
We need to find out how much of his bonus he'll be giving back. The formula to find the effect on our salary cap if we cut him is this:
(9.286 - The Amount He Gives Back) - 3.357
If the number comes up negative, that means our cap goes down. If it comes up positive, it means his current 3.357 cap hit will get bigger.