Forbes: LeBron Can Purchase Part of Knicks

[Malinhion]

This took me fifteen seconds to find on NBPA.org. Page 256-257 of the 2005 NBA CBA prohibits extra compensation:

ARTICLE XII
I CIRCUMVENTION
Section 1. General Prohibitions.
(a) It is the intention of the parties that the provisions agreed to herein, including, without limitation, those relating to the Salary Cap, the Exceptions to the Salary Cap, the scope of Basketball Related Income, the Escrow System, the Rookie Scale, the Right of First Refusal, the Maximum Player Salary, and free agency, be interpreted so as to preserve the essential benefits achieved by both parties to this Agreement. Neither the Players Association, the NBA, nor any Team (or Team Affiliate) or player (or person or entity acting with authority on behalf of such player), shall enter into any agreement, including, without limitation, any Player Contract (including any Renegotiation, Extension, or amendment of a Player Contract), or undertake any action or transaction, including, without limitation, the assignment or termination of a Player Contract, which is, or which includes any term that is, designed to serve the purpose of defeating or circumventing the intention of the parties as reflected by all of the provisions of this Agreement.

(b) It shall constitute a violation of Section 1(a) above for a Team (or Team Affiliate) to enter into an agreement or understanding with any sponsor or business partner or third-party under which such sponsor, business partner or third-party pays or agrees to pay compensation for basketball services (even if such compensation is ostensibly designated as being for non-basketball services) to a player under Contract to the Team. Such an agreement with a sponsor or business partner or third-party may be inferred where: (i) such compensation from the sponsor or business partner or third-party is substantially in excess of the fair market value of any services to be rendered by the player for such sponsor or business partner or third-party; and (ii) the Compensation in the Player Contract between the player and the Team is substantially below the fair market value of such Contract.

(c) It shall constitute a violation of Section 1(a) above for a Team (or Team Affiliate) to have a financial arrangement with or offer a financial inducement to any player (not including retired players) not signed to a current Player Contract, except as permitted by this Agreement.

FORBES FAIL.

[alucryts]

This took me fifteen seconds to find on NBPA.org. Page 256-257 of the 2005 NBA CBA prohibits extra compensation:

ARTICLE XII
I CIRCUMVENTION
Section 1. General Prohibitions.
(a) It is the intention of the parties that the provisions agreed to herein, including, without limitation, those relating to the Salary Cap, the Exceptions to the Salary Cap, the scope of Basketball Related Income, the Escrow System, the Rookie Scale, the Right of First Refusal, the Maximum Player Salary, and free agency, be interpreted so as to preserve the essential benefits achieved by both parties to this Agreement. Neither the Players Association, the NBA, nor any Team (or Team Affiliate) or player (or person or entity acting with authority on behalf of such player), shall enter into any agreement, including, without limitation, any Player Contract (including any Renegotiation, Extension, or amendment of a Player Contract), or undertake any action or transaction, including, without limitation, the assignment or termination of a Player Contract, which is, or which includes any term that is, designed to serve the purpose of defeating or circumventing the intention of the parties as reflected by all of the provisions of this Agreement.

(b) It shall constitute a violation of Section 1(a) above for a Team (or Team Affiliate) to enter into an agreement or understanding with any sponsor or business partner or third-party under which such sponsor, business partner or third-party pays or agrees to pay compensation for basketball services (even if such compensation is ostensibly designated as being for non-basketball services) to a player under Contract to the Team. Such an agreement with a sponsor or business partner or third-party may be inferred where: (i) such compensation from the sponsor or business partner or third-party is substantially in excess of the fair market value of any services to be rendered by the player for such sponsor or business partner or third-party; and (ii) the Compensation in the Player Contract between the player and the Team is substantially below the fair market value of such Contract.

(c) It shall constitute a violation of Section 1(a) above for a Team (or Team Affiliate) to have a financial arrangement with or offer a financial inducement to any player (not including retired players) not signed to a current Player Contract, except as permitted by this Agreement.

FORBES FAIL.

why can you just accept it?? haha good find

[crzy]

Um....I don't see a single thing in those paragraphs that say he can't own a part of the team.

That would be investing his own money, the team wouldn't be paying him anything to "own" the team.

[alucryts]

Um....I don't see a single thing in those paragraphs that say he can't own a part of the team.

That would be investing his own money, the team wouldn't be paying him anything to "own" the team.

he cant get money from the knicks in any way shape or form past his contract. investing in the knick is getting money from the knicks outside his contract

basically its illegal to do it under the CBA and should be. if he could do that it would be real **** and shady.

he COULD own the team, IF he didnt make any money from it.

[OooSplendiforous]

This took me fifteen seconds to find on NBPA.org. Page 256-257 of the 2005 NBA CBA prohibits extra compensation:

ARTICLE XII
I CIRCUMVENTION
Section 1. General Prohibitions.
(a) It is the intention of the parties that the provisions agreed to herein, including, without limitation, those relating to the Salary Cap, the Exceptions to the Salary Cap, the scope of Basketball Related Income, the Escrow System, the Rookie Scale, the Right of First Refusal, the Maximum Player Salary, and free agency, be interpreted so as to preserve the essential benefits achieved by both parties to this Agreement. Neither the Players Association, the NBA, nor any Team (or Team Affiliate) or player (or person or entity acting with authority on behalf of such player), shall enter into any agreement, including, without limitation, any Player Contract (including any Renegotiation, Extension, or amendment of a Player Contract), or undertake any action or transaction, including, without limitation, the assignment or termination of a Player Contract, which is, or which includes any term that is, designed to serve the purpose of defeating or circumventing the intention of the parties as reflected by all of the provisions of this Agreement.

(b) It shall constitute a violation of Section 1(a) above for a Team (or Team Affiliate) to enter into an agreement or understanding with any sponsor or business partner or third-party under which such sponsor, business partner or third-party pays or agrees to pay compensation for basketball services (even if such compensation is ostensibly designated as being for non-basketball services) to a player under Contract to the Team. Such an agreement with a sponsor or business partner or third-party may be inferred where: (i) such compensation from the sponsor or business partner or third-party is substantially in excess of the fair market value of any services to be rendered by the player for such sponsor or business partner or third-party; and (ii) the Compensation in the Player Contract between the player and the Team is substantially below the fair market value of such Contract.

(c) It shall constitute a violation of Section 1(a) above for a Team (or Team Affiliate) to have a financial arrangement with or offer a financial inducement to any player (not including retired players) not signed to a current Player Contract, except as permitted by this Agreement.

FORBES FAIL.

Anyone can purchase stock. No one is forcing or offering him this option. He's doing it by himself. And as long as noone specifically uses this as an incentive to sign him, it's fine. The Knicks lawyers I'm sure have reviewed this. Not only that you're discounting the possibility of LeBron having his mother or someone else in the family purchase the stock for him.... Theres ways to get around everything.

[Robert23]

and I'll address this before somebody trying to be a wise guy brings up this argument: "What if he goes to a different team, he could still purchase MSG stock just like anyone else, he'll own part of the Knicks and play for a different team". The answer is yes, HOWEVER he wouldn't reap the benefits of a skyrocketing stock price because he wouldn't be playing for us, therefore no buzz would be generated and probably no significant increases in market price. The stock currently trades at $22 a share, if played for the Knicks one could expect a price of $50 a share, he'd double his money immediately. However if he didn't play for us and purchased our stock, why would the $22 current price fluctuate much? Chris Bosh doesn't bring in sponsors...

Currently the price is at $22 with the possibility of LeBron going to the Knicks. Why not go to a different team right after the announcement the price is bound to drop some more then buy the stock? Then after winning some championships on another team and after 5 or 6 years. Then go to the Knicks and sell the stock. He'd triple or quadruple his money then.

[#1 pick]

This is college basketball recruiting times 10000.

[alucryts]

Anyone can purchase stock. No one is forcing or offering him this option. He's doing it by himself. And as long as noone specifically uses this as an incentive to sign him, it's fine. The Knicks lawyers I'm sure have reviewed this. Not only that you're discounting the possibility of LeBron having his mother or someone else in the family purchase the stock for him.... Theres ways to get around everything.

and the ways to get around it are illegal, like jail illegal.

[#1 pick]

Anyone can purchase stock. No one is forcing or offering him this option. He's doing it by himself. And as long as noone specifically uses this as an incentive to sign him, it's fine. The Knicks lawyers I'm sure have reviewed this. Not only that you're discounting the possibility of LeBron having his mother or someone else in the family purchase the stock for him.... Theres ways to get around everything.

and the ways to get around it are illegal, like jail illegal.

Only the back of my dollar bill could land Lebron in New York.

[crzy]

Here is the rule

Section 8. Limitation on Player Ownership.

During the term of this Agreement, no NBA player may acquire or hold a direct or indirect interest in the ownership of any NBA Team; provided, however, that any player may own shares of any publicly-traded company that directly or indirectly owns an NBA Team.

[jwood255]

Real question is would anybody here be willing to invest a large sum in MSG stock and hope Lebron signs with the Knicks?

[Awoooga]

That settles it. It can be done, and I am sure James will look into it. SMH at the geniuses trying to sell this as a cap circumventing move. Purchasing shares of stock in a team will never be classified like that because shares can always lose value, and there is no arraignment with the knicks. Lebron is purchasing shares in a publicly traded company like any of us on this site could.

[sabi]

and I'll address this before somebody trying to be a wise guy brings up this argument: "What if he goes to a different team, he could still purchase MSG stock just like anyone else, he'll own part of the Knicks and play for a different team". The answer is yes, HOWEVER he wouldn't reap the benefits of a skyrocketing stock price because he wouldn't be playing for us, therefore no buzz would be generated and probably no significant increases in market price. The stock currently trades at $22 a share, if played for the Knicks one could expect a price of $50 a share, he'd double his money immediately. However if he didn't play for us and purchased our stock, why would the $22 current price fluctuate much? Chris Bosh doesn't bring in sponsors...

Madison Square Garden stock? wth

[dm17415]

Here is the rule

Section 8. Limitation on Player Ownership.

During the term of this Agreement, no NBA player may acquire or hold a direct or indirect interest in the ownership of any NBA Team; provided, however, that any player may own shares of any publicly-traded company that directly or indirectly owns an NBA Team.

That pretty much proves this is legal, also if Lebron does buy the stocks he'll be buying MSG stocks which is the parent company of the MSG stadium itself, Knicks, Rangers, Liberty and Radio City Music Hall.

[JustBlaze]

ohhh everyones quiet now, but when bad things are happening to us the vultures are out.... ok

Haha..Didn't know anything good has happened for the Knicks yet.

[Hemingway]

For the first time, I think he is going to New York.

So he would obviously buy a ton of their stock before he signs. He probably already has. maybe I should too. How much other stuff is lumped in with the Knicks? Once LBJ signs their ticket sales will sell out.

[Childs2Dudley]

For the first time, I think he is going to New York.

So he would obviously buy a ton of their stock before he signs. He probably already has. maybe I should too. How much other stuff is lumped in with the Knicks? Once LBJ signs their ticket sales will sell out.

The Knicks are only a small percentage of MSG profits. But I would buy it anyway since MSG rakes in the cash every year.

[AKfanatic]

How much other stuff is lumped in with the Knicks?

Madison Square Garden is a fully-integrated sports, entertainment and media business. The company is comprised of three business segments: MSG Sports, MSG Entertainment and MSG Media, which are strategically aligned to work together to drive its overall business, and built on a foundation of iconic venues and compelling content that MSG creates, produces, presents and/or distributes through its programming networks and other media assets. MSG Sports consists of the New York Knicks (NBA), the New York Rangers (NHL), the New York Liberty (WNBA), and the Hartford Wolf Pack (American Hockey League).

http://investor.msg.com/releasedetail.cfm?ReleaseID=444042

[Mikistan]

Must...
Buy...
Shares...

[Sebastian]

While it may be legal for a player to own stock in a company that owns an NBA team, a player can not legally buy shares in said company, then shortly thereafter sign with the team that the company owns, causing the stock to skyrocket.

Not unless that player wants to go to LeJail.