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May 25, 2005 - NHL owners, players nearing agreement

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NHL owners, players nearing agreement

Wednesday, May 25, 2005

Courier-Post Staff

For the first time in months, there is growing optimism that the stalemate between the NHL and its players is dissolving, and an agreement could be announced within two weeks.

With major sponsorship agreements set to expire June 15 and a proposal by ESPN2 threatening to be pulled off the table on June 1, the pressure to save next season has never been greater.

"I think a lot of us have the feeling this is the calm before the storm," Flyers captain Keith Primeau said from Toronto Tuesday. "I think they feel they are making progress and they want to keep things under wraps until they get it done."

After 22 hours of negotiations last week, NHL chief legal officer Bill Daly said progress was made on some of the "key issues pertaining to a new economic system."

The two sides spent much of last week reviewing the NHL's Levitt Report, which revealed that 11 of the league's 30 teams accounted for $273 million in losses during the 2002-03 season, and how revenue is reported by each team. The review of that information indicates the players have agreed to a linkage between revenue and salaries.

This week, the two sides are expected to discuss how a salary cap system would work under a new agreement. On April 4, the players' union proposed a cap of $50 million and a floor of $30 million. NHL commissioner Gary Bettman has proposed a $31 million cap, but the league's owners likely would approve a hard cap between $40 million and $45 million.

Meanwhile, ESPN2 and major sponsors such as Ford, Molson and Sony want to know whether there is going to be hockey next season.

ESPN2, which last year agreed to broadcast 40 regular season games in 2005-06, would like to rework the agreement so that it can have exclusive rights to each game of the Stanley Cup finals. Those rights currently belong to NBC, which agreed last year to broadcast just seven regular-season games and six playoff games, as well as Games 3 through 7 of the finals. The NHL has agreed to pay for production costs simply to get itself on national television.

"We need that cable coverage," Primeau said of ESPN2. "We need the exposure after having a year off."

Team executives also are pressuring the two sides to come to an agreement quickly so that they can line up sponsors and advertisers, settle their own TV deals and work on ticket sales.

"It's really hard to sell your product to advertisers and season-ticket holders if this drags on through the summer," said Peter Luukko, president of Comcast-Spectacor Ventures.