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Under terms of the NFL Collective Bargaining Agreement, a team losing more or better compensatory free agents than it acquires in a year is eligible to receive compensatory draft picks.

The number of picks a team receives equals the net loss of compensatory free agents up to a maximum of four.  The 32 compensatory choices announced today will supplement the 223 choices in the seven rounds of the 2007 NFL Draft (April 28-29).  This year, the compensatory picks will be positioned within the third through seventh rounds based on the value of the compensatory free agents lost.

Compensatory free agents are determined by a formula based on salary, playing time and postseason honors.  The formula was developed by the NFL Management Council.  Not every free agent lost or signed by a club is covered by this formula. 

One club this year (Cincinnati) will receive a compensatory pick even though it did not suffer a net loss of compensatory free agents.  Under the formula, the compensatory free agents Cincinnati lost were ranked higher than the ones it signed (by a specified point differential based upon salary and performance).