NEW YORK -- A source with knowledge of the NFL talks told ESPN's Sal Paolantonio on Thursday night that the negotiations for a new collective bargaining agreement are headed toward a settlement.

The sides have agreed in principle to a rookie wage system, sources told ESPN NFL Insider Adam Schefter. Since that is no longer an impediment to a deal, the source told Paolantonio, "both sides are intent on working through each issue line by line to get this deal done."

The progress made was significant -- with almost unforeseen momentum -- surprising even the participants, another source said.

The movement in talks has raised hopes that a tentative agreement in principle could perhaps come within 24 hours, two people familiar with the negotiations told The Associated Press. They cautioned, however, that other key issues remained for owners and players to resolve, including free agency and new offseason workout rules.

There was also a tentative agreement to make the 2011 salary cap $120 million, a source told ESPN.com NFL senior writer John Clayton.

When a new collective bargaining agreement is reached, it will be seven to 10 years in length, sources have told ESPN.

After meeting for nearly 15 hours Thursday, NFL commissioner Roger Goodell, NFL Players Association chief DeMaurice Smith, players and owners were back at the negotiating table Friday as they attempted to end the sport's first work stoppage since 1987. Goodell has asked the NFLPA for a full day of talks, a source familiar with the meeting told ESPN's Schefter.

"I know our fans are frustrated and want (us) to get it done," Smith said as he entered the Times Square office building where the negotiations were being held. "We'll get everything to the players when the time is right."

Baltimore Ravens defensive back Domonique Foxworth emphasized when the last of the participants left after 11:30 p.m. Thursday, saying "there's really no deal until our players approve it."

Since February, the players have been willing to accept a $141 million player cost number -- which includes both salaries and benefits paid to players -- per team, multiple sources told Clayton. By agreeing to the $120 million cap, the players allow $21 million per team to be in benefits. Now that a cap number has been formed, teams need to determine the minimum cash payroll number, or what teams will be required to spend.

The guaranteed spend forces every team to put up more than 90 percent of the salary cap in cash each season. A couple of weeks ago, the owners talked about having the guaranteed spend number at close to 100 percent of the salary cap, according to sources. That number and percentage could still be adjusted.

The 2009 cap was $123 million but was moved by $5 million to $128 million due to a one-time adjustment called a cash adjustment mechanism. The change is an aberrational adjustment, due to the fact that 2009 was the last capped season of the previous CBA.

Last season was an uncapped year.

Because a 2011 salary cap of $120 million could cause problems for teams such as Dallas, Pittsburgh and others that currently spend more than that, one of the provisions being discussed is a one-player cap exemption for each team, according to a source. That exemption would be a $3 million credit in 2011 that would count against benefits paid out, a source said. That exemption, which could drop to $1.5 million next year, could save the jobs of players.