Compensation to the receiving club is made up entirely of draft picks.
The draft picks must available in the nearest entry draft, unless the compensation requires two or more draft picks in the same round: an extra year can be used to for compensation for these picks (if two 1st round picks are required, the club must have two 1st round picks available in the next three drafts)
Compensation is determined by the annual average (AAV) outlined in the offer made by submitting club.
The AAV for an offer sheet, which determines the compensation required, is derived by dividing the total contract value amount by the lesser of:
number of years offered, or
five (5) years
The AAV thresholds are readjusted each season, and is based on the average league salary for that season.
An offer sheet cannot be greater than 7 years in length.