The Washington Capitals plan to give General Manager George McPhee a one-year contract extension next week, sources said, shortly after he returns from a one-month suspension for an altercation with the Chicago Blackhawks.

McPhee and Capitals Coach Ron Wilson are in the final year of three-year contracts. Wilson also is likely to receive a one-year extension soon.

McPhee was fined $20,000 and suspended for a month for punching Chicago Coach Lorne Molleken after overly physical play by the Blackhawks in a September preseason game. McPhee will return to work Monday.

He was prohibited from attending any Capitals practices or games, and could not visit the team's offices. He was barred from communicating with anyone within the organization or from any other NHL team. He also was instructed not to talk to the media. He spent much of the month watching games via a satellite dish and traveling to Portland, Maine, to watch the Capitals' minor leaguers.

McPhee's actions were publicly supported by the Capitals' new ownership group. Although the team has struggled this season, sources say primary owners Ted Leonsis and Jon Ledecky are committed to giving McPhee and Wilson time to turn the team around.

The Capitals appeared in the Stanley Cup finals in 1998 but missed the playoffs last season.

The team also is battling to increase awareness and season ticket sales, and will need wins to do so. No one in the front office is panicking, sources said, but the team is being evaluated closely.

Leonsis and Ledecky believe the Capitals are capable of challenging for the Southeast Division title and making the playoffs. The Capitals have more than 70 games to play, but their 2-5-2 start has them in the basement of the division, with Tampa Bay and Atlanta, an expansion team.

It's likely that the owners will meet with McPhee and Wilson next week when the team returns from its West Coast trip. After this trip, the Capitals will play seven of their next eight games at MCI Center.

If the club has not shown improvement, it's expected that team officials would begin aggressively exploring trades and the free agent market.

McPhee, the fifth general manager in franchise history, came to the Capitals from Vancouver, where he worked as an assistant general manager after his playing career ended. Wilson was an assistant coach in Vancouver before becoming head coach in Anaheim for four seasons.