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w&s's "Ming Lowest Paid #1" numbers might be Les's Max Offer

Discussion in 'Houston Rockets: Game Action & Roster Moves' started by heypartner, Jul 17, 2002.

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  1. ROXTXIA

    ROXTXIA Member

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    Man, Yao-za's getting his ass fleeced.

    When Yao's smiling at us as the next McDonald's cardboard cut-out, holding a McLarge fries, urging us to Vote For the NBA All-Stars, does he have to give half of his endorsement money away, too?

    Because that would Mc-Suck.
     
    #21 ROXTXIA, Jul 17, 2002
  2. DaDakota

    DaDakota Balance wins
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    Wind&Sea,

    Don't forget that our government gets the first 40% of his millions, then the CBA and Sharks get theirs...so out of the first 10 million.

    USA government 4 million
    CBA 3 million
    Ming 3 million

    He will then have to pay the Sharks out of his 3 million......and endorsment deals of course.

    DaDakota
     
    #22 DaDakota, Jul 17, 2002
  3. michecon

    michecon Member

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    W&S, I have yet to see any real report that MIng owes Sharks $10 m. Yea, I've seen this number, but that's just speculation of Chinese reporters (boy, I hate them), neither Sharks nor Ming's agent conferred that. In fact, they said their contract is based on some sort of revenue share, which makes sense. Besides those curious Chinese reporters, I don't see much use in discussing Ming's earning. I am sure Rockets will treat him well.
     
    #23 michecon, Jul 17, 2002
  4. michecon

    michecon Member

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    This can not be true. What if he gets injured when his rookie contract runs out and cannnot call any more, Is he gonna leave US with $2.5 M in debt? If that's the case, he should live on street to save insurance money. I am sure he won't.
     
    #24 michecon, Jul 17, 2002
  5. windandsea

    windandsea Member

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    michecon:

    Sharks is very kind that it has put the injury situation in their contract with Ming. For their sake they will pray that Ming maintains health until they get the total payment from Ming.
     
    #25 windandsea, Jul 17, 2002
  6. heypartner

    heypartner Member

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    Aha, but you are not following my accounting loophole in this thread.

    The Rockets can pay the Sharks ~$4m in a direct buyout. None of that would be taxable.

    $3.6m of it over 4yrs would count against Ming's rookie scale, so he'd take less pay, but that is the best accounting way for him to pay. If he pays out of pockets, it is taxable. If he takes a lower base salary, and lets the Rockets use the remainder as a buyout, it is not taxable.

    Who is following me? We can exceed the $350K buyout, but it counts against Ming's salary cap, but not as taxable income since it is a foreign player payment to his team.
     
    #26 heypartner, Jul 17, 2002
  7. Rudyball

    Rudyball Member

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    I got ya HP, but there has been no mention of any endorsement deals and how Ming could pay/share that to relieve his debts in china.

    Obviously, the guy has to bring in some money to live/work on so all the scenarios of him owing money beyond what he can make a year don't fly all together. If the sharks are taking all the rest of his salary then they would have to support him over here just as they support him over there.

    I can just imagine the endorsement deals that are knocking down his door. He should be able to take care of the Sharks in a couple of years not including his salary. Can you imagine how big of a commercial impact he can have just in the far east !
     
    #27 Rudyball, Jul 17, 2002
  8. rockbox

    rockbox Around before clutchcity.com

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    HP,

    Why don't we give him just 80% and leave the rest to buy out his contract. Wouldn't that be the best thing to do if this scenario was true? I'm not good at legalese, so I might be missing something.
     
    #28 rockbox, Jul 18, 2002
    Last edited: Jul 17, 2002
  9. michecon

    michecon Member

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    Most probablly they have. I just hate false reporting. This has led some cc members to believe he has to bring in his own money to live here.
    Quote:
    "Obviously, the guy has to bring in some money to live/work on so all the scenarios of him owing money beyond what he can make a year don't fly all together. "

    I understand many of you are bitter since you think Shark doesn't deserve what they get. I just hope my Chinese friends don't fanfare unverified story. I am sure there are some Chinese internet reporters/writers here on this BBS. I just hope they write their story based on facts and with source. THat's all.
     
    #29 michecon, Jul 18, 2002
  10. heypartner

    heypartner Member

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    Ming wouldn't have to go all the way down to 80%, because the buyout is limited to 25% of his 4yr Compensation. The buyout is limited to 25% of Compensation just like a signing bonus is limited to 25%.

    Given Ming's maximum allowable 4yr contract of $18m, to find what Ming's possible max salary if it included a maximum buyout of 25%, you use this formula:

    1.25 times X = $18m

    solving for X, you get:

    X = $18m / 1.25
    X = $14.4m

    $14.4m is Ming's max pay while still allowing for a 25% payout. The buyout that goes to the Shark's is 18-14.4 = $3.6m. This is paid in yearly installments of 900K.

    To find his 1st yr base salary, simply find his maximum allowable 1st yr salary and subtract the yearly installment that I just calculated.

    Which is:

    $3,215 x 1.20 = $3,858 - $900K = <b>$2,958</b>

    This equals 92% of his standard rookie scale pay.
     
    #30 heypartner, Jul 18, 2002
  11. Invisible Fan

    Invisible Fan Member

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    Ming is one patriotic motherf*cker. That's all I can say.
     
    #31 Invisible Fan, Jul 18, 2002
  12. SmeggySmeg

    SmeggySmeg Member

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    Man, that was so cool HP, where were you when i needed you in high school math!!

    and so now can you Pull the Rabbit out of your ...............
     
    #32 SmeggySmeg, Jul 18, 2002
  13. heypartner

    heypartner Member

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    Reading is Fundamental, and Math is "Cool." There's still hope for you Aussie's, I guess.
     
    #33 heypartner, Jul 18, 2002
  14. fl0185

    fl0185 Member

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    I am very surprised everyone missed the fact that CBA will take half of Ming's salary before tax.
    Then, the math is simple:
    CBA : 50%
    US Tax : 40%

    I doubt Ming will have enough money to pay off Shanghai Sharks.
     
    #34 fl0185, Jul 18, 2002
  15. heypartner

    heypartner Member

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    All salary will be taxed. Foreign Player Payments will not be taxed.

    The Rockets can pay $4m directly to the Sharks/CBA over 4yrs, taxfree, as a buyout. That is what this whole thread is about.

    However, anything else must be after taxes, because everything else must go to Ming directly as Compensation (by NBA rules), thus it is taxed. Do you want to see the Labor Treaty between China and the US that enforces US taxation of all "athletes and entertainers." The CBA cannot usurp a diplomatic Treaty between two Nations that has been in place for awhile.

    Ming is in the position to make $18m. He can negotiate $3.6m of that as non-taxable Foreign Player Payment directly between the Rockets and any Chinese Entity:

    My breakdown of his max salary is:

    $14.4m as Player Compensation (taxable)
    $3.6m as a Foreign Player Payment (not taxable)

    and the Rockets can further toss in $350K.
     
    #35 heypartner, Jul 18, 2002
    Last edited: Jul 18, 2002
  16. windandsea

    windandsea Member

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    Ming has to pay Sharks. The negotiation between them has done. How much will he pay? According to reporter Su Qun and Yang Yi, it's $10 million. Sharks said that it's a long term contract based on Ming's income.
     
    #36 windandsea, Jul 18, 2002
  17. heypartner

    heypartner Member

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    btw: this whole before/after taxes thing regarding Ming seems pure speculation. None of us know this.

    Windandsea,

    Let's reconfigure your numbers based on the $4m buyout we can pay.

    Taking your number that Ming must pay the Sharks $10m, and give CBA half of his <b>net income</b> from the NBA. (I refuse to believe it is 50% before taxes, as others say. NBA paycheck are after taxes, and US and China have a taxation treaty that athletes/entertainers pay is indeed taxable.)

    <ul><li>The Rockets can pay the Sharks $4m (taxfree) over 4yrs, as I've shown in this thread.
    <li>Ming can make $14.4m beyond that as salary, and I don't see how the CBA would except less on his behalf.
    <li>The Rockets must tax that at 40% to equal $8.64m. CBA and Ming each get $4.32m
    <li>Notice how $7.2 would be 50% before taxes, which would leave $1.44m over 4yrs. Common sense shows that the CBA is not demanding 50% before taxes, because the Sharks would never get paid.
    <li>Assuming Ming keeps a very modest $100k/yr for himself for 4yrs, then he could have $8m paid off to the Sharks in that time. $4m by the Rockets, and $4m from his salary.</ul>Going into his 5th year, Ming could very easily have only $2m left to pay the Sharks.
     
    #37 heypartner, Jul 18, 2002
  18. sirhangover

    sirhangover Member

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    this attention to detail and thoroughness would do great in analysis of marble..

    :)

    would you hold yourself liable to the information you give in this thread...?

    maybe maybe not??
     
    #38 sirhangover, Jul 18, 2002
  19. heypartner

    heypartner Member

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    Our marble's whiteness is better than the Colorado Yule marble.

    Bet Me!
     
    #39 heypartner, Jul 18, 2002
  20. Joe Fan

    Joe Fan Member

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    I believe he gets a credit on his US return for foreign taxes paid.
     
    #40 Joe Fan, Jul 19, 2002
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