Warriors trades/cash sent

[Chris Cohan]

Would a new owner be on the hook for the add'l $2 million in salary Bell and Gadzuric make over Maggette while Cohan basically still pockets the $2 million from the Portland pick swap?

[cladden]

Would a new owner be on the hook for the add'l $2 million in salary Bell and Gadzuric make over Maggette while Cohan basically still pockets the $2 million from the Portland pick swap?

The new owner will be on the hook for lack of the remainder of Maggette's contract. He should be very happy about it (the new owner).

[Dunkenstein]

I wouldn't be surprised if we learn that the Warriors got the Bucks to pay for the difference between their players' salaries and Maggette's salary for next season. And of course that money will go directly in Cohan's pocket.

For their next bold move, watch the Warriors trade the 6th pick in the draft so that Cohan can pocket another $3M before he sells the team. He's probably also selling the furniture and light fixtures in an effort to pocket every dime he can before the sale goes through.

[FGump]

Would a new owner be on the hook for the add'l $2 million in salary Bell and Gadzuric make over Maggette while Cohan basically still pockets the $2 million from the Portland pick swap?

It's easy to glibly say that Cohan has pocketed $2M from the swap of draft picks ...but while it doesn't suit your agenda to recognize it, the actual truth is he likely didn't get the money personally. For tax purposes as well as for general accounting and cash flow, the $2M went into Warrior accounts and will most likely remain there for now, and those accounts will be part of the asset base being sold.

Could Cohan strip the cash from the corporation at some point prior to sale and distribute it to the shareholders? Of course. But the presence or absence of cash will be factored into the sale price, so there's no advantage to grab it if a sale is happening soon. And there are tax reasons not to do so - it's far better tax-wise for Cohan to get the money as increased value (capital gains) from the sale.

As for the Maggette deal, I have to think that the new owner isn't going to want to quibble over it or talk about who-owes-who-what as a result of that swap. Because, while the short term payroll went up about 1.5M, the Warriors took Maggette's $31M owed and cut it to less than half.

[Chris Cohan]

Payroll went up $2 million with the Bell trade kicker I believe.
And Cohan pockets the cash for sure.

[FGump]

Payroll went up $2 million with the Bell trade kicker I believe.
And Cohan pockets the cash for sure.

In common parlance, Cohan is the "owner" and therefore what goes into the team's pocket goes into his. But in actuality, that's not going to be accurate. Instead, there will be some sort of corporate or partnership entity that's actually the owner, and the cash will go to that entity. Once that entity has funds - via trades, ticket sales, marketing, or whatever - Cohan probably has access to raid those funds in some manner, but in so doing the other partners/owners come into play, as do tax consequences.

So (as I said earlier) while he could glom the cash gained from the trade, it's unlikely he will. The tax ramifications - especially in light of his prior and ongoing tax problems - are likely to motivate him to keep his fingers out of the cash accounts for the next month or two, and let the acquired moneys come to him via the more tax-friendly avenue of a higher sales price.

As for Bell's trade kicker, (a) Sham's site doesn't note one, and (b) it's existence is an irrelevancy anyhow to a future owner, because it was paid at trade time either by GS's current owner or by Milwaukee. While it will raise the team's future cap number, it will NOT alter the future payroll.

[mysticbb]

As for Bell's trade kicker, (a) Sham's site doesn't note one, and (b) it's existence is an irrelevancy anyhow to a future owner, because it was paid at trade time either by GS's current owner or by Milwaukee. While it will raise the team's future cap number, it will NOT alter the future payroll.

http://blog.shamsports.com/2010/06/curr ... ckers.html

How is that determined who pays that trade bonus? I've always wondered how they do it. Is it possible to split that, say 50% is paid by the Bucks and 50% is paid by the Warriors? Also, is it always possible to pay the complete trade bonus right away or are there limitations?

[Chris Cohan]

So is the answer here that Cohan got the $2 million and then applied it to the $2 million add'l salary charged pre-July 1st, thus netting the team no savings whatsoever, ever?

Cuz the team itself was saying, in part, that the draft pick deal was smart b/c it made the team money.

Either they made nothing or, worse, next owner still on the hook.....

And the salaries of Bell and Gadz are in fact higher than Maggette's, by the way.

[loserX]

So is the answer here that Cohan got the $2 million and then applied it to the $2 million add'l salary charged pre-July 1st, thus netting the team no savings whatsoever, ever?

Salary is paid out evenly over the year. It's not like there's a $2M lump sum salary differential sitting there at the end of the year for Cohan to pay after swapping these guys. Whatever margin there was left between 2009-2010 salaries from the date of the trade until June 30 won't be very much, certainly not ~$2M.

[FGump]

So is the answer here that Cohan got the $2 million and then applied it to the $2 million add'l salary charged pre-July 1st....

You're working your tail off to turn a positive into a negative, aren't you? It's hard to do when you don't have valid reasons, and as a result your flaming agenda is showing.

Regarding the so-called "$2 million add'l salary charged pre-July 1st", there was no such $2 million "additional salary." In fact, there wasn't any. Players receive all their salary for the just-completed season well before June.

[Chris Cohan]

The question is pretty straightforward, upon closer review.
Sorry for any confusion. I'll pose it more simply for you:

Does the trade kicker apply to the 2009-10 salary?

[FGump]

So is the answer here that Cohan got the $2 million and then applied it to the $2 million add'l salary charged pre-July 1st, thus netting the team no savings whatsoever, ever?

The team got $2M from the draft pick move. There was no pre-July 1st salary after the trade. Looks like the team made $2M.

Cuz the team itself was saying, in part, that the draft pick deal was smart b/c it made the team money.

It appears they were telling the truth, then.

And the salaries of Bell and Gadz are in fact higher than Maggette's, by the way.

Bell-Gadz are owed 15.8M in total. Maggette is owed 30.8M.

Your math skills suck.

The question is pretty straightforward, upon closer review.
Sorry for any confusion. I'll pose it more simply for you:

Does the trade kicker apply to the 2009-10 salary?

Didn't see a non-rhetorical question being asked.

While the bonus would have already been paid by someone (to my knowledge no one has said who paid it), as I understand it the amount of approx 660K (a) would have been calculated on 2010-11 salary only, and (b) will therefore be charged to 2010-11 cap only.

[Chris Cohan]

Then it's all charged to the next owner and Cohan pockets the draft pick sale cash. Thanks.

[Dunkenstein]

While the bonus would have already been paid by someone (to my knowledge no one has said who paid it), as I understand it the amount of approx 660K (a) would have been calculated on 2010-11 salary only, and (b) will therefore be charged to 2010-11 cap only.

Both Sham's and answerthink's salary sheets seem to indicate that a 15% bonus was applied to Bell's salary in both 2009-10 and 2010-11.

[FGump]

Then it's all charged to the next owner and Cohan pockets the draft pick sale cash. Thanks.

Unless there's usable cap room being expended or the team lands over the tax line (neither of which is the case here), then the "charge" isn't a financial hit, it's just an increased cap number that otherwise has no effect. And yes the Warriors as an organization enhanced their cash holdings, which ultimately will enhance the value of the franchise to the new owner when it's being bought. Glad to clear that up for you.

[FGump]

While the bonus would have already been paid by someone (to my knowledge no one has said who paid it), as I understand it the amount of approx 660K (a) would have been calculated on 2010-11 salary only, and (b) will therefore be charged to 2010-11 cap only.

Both Sham's and answerthink's salary sheets seem to indicate that a 15% bonus was applied to Bell's salary in both 2009-10 and 2010-11.

As I understand it, the cap charge on a trade bonus is divided among remaining (guaranteed) years ...and I plead uncertainty whether 2009-10 would be considered a "remaining year" on a trade made after the season has already been completed and the salary for that year has already been paid in its entirety. In the answer above I guessed no, but could have guessed wrong.

[Three34]

It was for Bruce Bowen and Amir Johnson in this same situation last year.

[answerthink]

The season in which the trade occurs does count as a remaining year for allocation purposes all the way through June 30.

The language can be found in Art VII, Sec 3(1)-(2).

[FGump]

The language can be found in Art VII, Sec 3(1)-(2).

You meant Art VII, Sec 3 (b) (1)-(2), and thanks for finding that. I've looked several times in the past for that referenced rule and had never been able to find it.

[answerthink]

Oops. Forgot that damn B. Sorry.