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Falcons could get salary cap relief from Vick's new contract


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OP's Note: falcon22 had posted first but he did not printout article only link - this is why i started 2nd topic.....wanted to give credit to falcon22 for posting first.

PFT - Vick Contract and impact on Falcons

Vick’s creditors win with new contract

Posted by Mike Florio on August 31, 2011, 8:30 AM EDT

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By signing a six-year deal with $35.5 million guaranteed in lieu of taking a one-year guaranteed franchise tender in the amount of $16.2 million and hoping for a second guaranteed franchise tender of $19.44 million (for a two-year guaranteed haul of $35.6 million), Eagles quarterback Mike Vick opted for the bird in the hand.

For his creditors, the move puts a chicken in their pots.

“It’s a beautiful thing,” Vick bankruptcy trustee Joseph Luzinski told Bloomberg.com, adding that the money should “substantially clean up all of the claims.”

Vick originally owed his creditors $20 million, but Luzinski said that, to date, Vick has paid off only a “couple million.” The Falcons are the largest creditor, with a debt of $7.5 million arising from bonus money that Vick was forced to repay after defaulting on his contract with the team, via his dogfighting conviction.

For the Falcons, it could be about more than getting money back. The Falcons also could get salary cap credits, as the money comes in from Vick. NFL spokesman Greg Aiello tells PFT via e-mail that such matters are reviewed on a case-by-case basis, and that the question of whether the Falcons will receive cap credits is currently under review.

David Teel of the Newport News Daily Press reports that, based on Vick receiving $20 million in 2011, $6.76 million will go to creditors, $8 million will go to taxes, and Vick will receive net pay of $5.24 million.

Taking Luzinski’s “couple million” estimate literally, that means the creditors will still be owed another $11.24 million after 2011. In 2012, Vick is due to make $12.5 million. In 2013, it’ll be either $16.5 million or $15.5 million.

That probably should be enough to get the full amount cleared up under Vick’s bankruptcy plan. And perhaps the knowledge that so much of his money will go to others will prompt Vick to be more careful about his spending habits going forward.

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Holy crap...

I thought Vick's cap hit was completely off our books but apparently we STILL must be taking a cap hit for Vick if we could get cap space from his new contract.

It is a MIRACLE that the franchise was able to overcome the monster contract we gave to Vick. I have even more respect for TD and the front office.

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Holy crap...

I thought Vick's cap hit was completely off our books but apparently we STILL must be taking a cap hit for Vick if we could get cap space from his new contract.

It is a MIRACLE that the franchise was able to overcome the monster contract we gave to Vick. I have even more respect for TD and the front office.

The best is yet to come :D!!

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Holy crap...

I thought Vick's cap hit was completely off our books but apparently we STILL must be taking a cap hit for Vick if we could get cap space from his new contract.

It is a MIRACLE that the franchise was able to overcome the monster contract we gave to Vick. I have even more respect for TD and the front office.

I don't think he's still eating our cap per se. What I recall was when all the badness went down the Falcons were awarded some of his contract back. At the time he could not pay the amount we won ( seems like it was $5M -$7M range ... I'm going off memory so I could be way off ) so the NFL would not allow us at that time to get any Salary Cap credit because Vick didn't actually pay it at that time.

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Holy crap...

I thought Vick's cap hit was completely off our books but apparently we STILL must be taking a cap hit for Vick if we could get cap space from his new contract.It is a MIRACLE that the franchise was able to overcome the monster contract we gave to Vick. I have even more respect for TD and the front office.

No, his cap hit is completely off the books. Any cap hit a team takes will be completely off a team's books within 2 years of that player being off the team.

How this helps the Falcons is that Vick was sued by the team for his bonus money already paid (and for that matter already accounted for). Part of the court decision was for Vick to pay back "some" of that money, and that any money returned would be immediately added to our cap. Unfortunately, Vick filed for bankruptsy before he paid any back to the team. But with his new contract, he can now afford to pay Arthur the money he owes him.

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http://www.usatoday.com/sports/football/nfl/falcons/2008-02-04-vick-bonuses_N.htm

MINNEAPOLIS (AP) Jailed quarterback Michael Vick can keep all but $3.75 million of the nearly $20 million in bonus money he received from the Atlanta Falcons following a ruling Monday by a federal judge.

The Falcons sought to recover the bonuses after Vick pleaded guilty to federal charges in a dogfighting operation. The bonuses were paid from 2004-07.

A special master ruled in October the Falcons were entitled to recover the bonuses. The Falcons argued Vick used proceeds from a contract he signed in 2004 to finance his illicit activities.

But U.S. District Judge David Doty of Minneapolis ruled that recovery of most of the bonus money by the Falcons would violate the NFL collective bargaining agreement. The agreement does not allow roster bonus money to be forfeited once it's been earned, the judge wrote.

The NFL criticized Doty's ruling. The league has suspended Vick indefinitely without pay.

"It makes no sense that an individual who willfully violates his contract is entitled to be paid tens of millions of dollars even though he is in jail and providing no services whatsoever to his employer," NFL spokesman Greg Aiello said in a statement.

Vick's personal attorney, Lawrence Woodward Jr., said Vick was happy with the ruling but understands there could be appeals.

"He's grateful for some good news but he realizes he needs to keep doing all the right things to get back to playing football," Woodward said.

At a November hearing, union attorney Jeffrey Kessler contended Vick's "roster bonus" should be treated the same as a "performance bonus," which can't be forfeited under the agreement. The league maintained the roster bonus should be treated like a "signing bonus allocation," which could be forfeited.

Doty ruled that once Vick made the Falcons' 80-man roster, he earned the bonus money and the team cannot demand forfeiture. However, he wrote, the Falcons can recover $3.75 million of his 2006 signing bonus, which is governed by other rules and is something the union did not challenge.

Vick will count $7.57 million against the Falcons' salary cap in 2008 and more than $8 million in 2009.

Kessler welcomed the decision.

"The Players Association is obviously delighted with the result," Kessler said. "It vindicates our view that a clear deal was made, that once players earn their compensation, that it is no longer subject to being taken back."

While the distinction about whether Vick's roster bonuses were guaranteed or not guaranteed may be important for salary cap purposes, Doty wrote, "it does not dictate the outcome in a forfeiture context."

Any money recovered would be credited to Atlanta's future salary cap.

Doty also ruled that the Falcons may not use state law, even in a grievance procedure, to try to recoup Vick's bonus money.

Atlanta Falcons President Rich McKay issued a statement saying the team is disappointed with the ruling, but that it won't affect the Falcons' salary cap for the 2008 season.

"Any potential recovery would have only affected our 2009 salary cap," McKay said. "As to our future legal strategies, we will meet with our legal representatives to more fully understand our options before making that determination."

Vick received a 23-month jail sentence. He entered a minimum-security prison in Leavenworth, Kan., last month.

Edited by mountain_jim3
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I don't think he's still eating our cap per se. What I recall was when all the badness went down the Falcons were awarded some of his contract back. At the time he could not pay the amount we won ( seems like it was $5M -$7M range ... I'm going off memory so I could be way off ) so the NFL would not allow us at that time to get any Salary Cap credit because Vick didn't actually pay it at that time.

Yeah... I vaguely remember what you're saying but I thought we completely finished with Vick and any and all salary cap implications.

If we could gain cap space... again that just amazes me.

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If we got 7.5 back this year, Kelvin Hayden could be a possibility, to add veteran insurance for our Nickle position. I personally would like to see us move Grimes inside during nickel plays, since the others guys can play inside. Our move Grimes in when the other teams #1 WR moves to the slot. Our we could go ahead and lock up Brent Grimes. We could also extend Abraham and free some CAP, he is another high CAP guy.

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If we got 7.5 back this year, Kelvin Hayden could be a possibility, to add veteran insurance for our Nickle position. I personally would like to see us move Grimes inside during nickel plays, since the others guys can play inside. Our move Grimes in when the other teams #1 WR moves to the slot. Our we could go ahead and lock up Brent Grimes. We could also extend Abraham and free some CAP, he is another high CAP guy.

Not sure about Hayden. The fact that he has been a FA for as long as he has worries me. There are alot of teams looking for secondary help and there has to be a reason why he is still unsigned.

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Yeah, I agree, I only mentioned him because that name has been thrown around theses boards . I still would like us to bring in a vet for insurance. I don't know if anyone is available right now. I believe TD is waiting on cut downs to see what veterans get cut, I think we will bring in a veteran CB.

Edited by bighurt
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No, his cap hit is completely off the books. Any cap hit a team takes will be completely off a team's books within 2 years of that player being off the team.

How this helps the Falcons is that Vick was sued by the team for his bonus money already paid (and for that matter already accounted for). Part of the court decision was for Vick to pay back "some" of that money, and that any money returned would be immediately added to our cap. Unfortunately, Vick filed for bankruptsy before he paid any back to the team. But with his new contract, he can now afford to pay Arthur the money he owes him.

now we will see if he is still cool with Mr. Blank or not... u got the money to pay someone back then the right thing to do is to pay him back.. so lets hope he does.. he would be helping us in the future...

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So it appeas to me that PFT has the figure MV owes the Falcons wrong, and it's 3.75 million

Its 6.5 mil... The league and the Falcons was going to appeal the 3.7 mil judgement so Vick's camp compromised at 6.5 million.

ESPN

The Atlanta Falcons have reached a settlement with quarterback Michael Vick on their breach-of-contract claim that is still awaiting an appeals court decision on a grievance case.

Under the settlement, Vick has agreed to pay the Falcons $7.5 million if the team wins an appeal in the Eighth Circuit Court, and $6.5 million if the court upholds U.S. District Judge David Doty's decision that Vick is only liable for $3.75 million.

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now we will see if he is still cool with Mr. Blank or not... u got the money to pay someone back then the right thing to do is to pay him back.. so lets hope he does.. he would be helping us in the future...

He doesn't really have a choice ... he filed for bankruptcy so he's under a court ordered repayment plan to all his creditors.

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