Confirmed Signing with Link: [CAR] F Seth Jarvis signs extension with the Hurricanes (8 years, $7.420087M AAV; deferred salary in 9th year)

[GKJ]

Had no idea you could defer money and it’s insane the the richer teams never use it.

 

[Bond]

So what’s stopping teams from signing star players to $1m salary contracts with $10mil deferred signing bonus cap free?

Players wanting their money

 

[Le Barron de HF]

I'm surprised this hasn't been used more. Seeks like a strange thing to include

 

[TheReelChuckFletcher]

It's a real turn for the Hurricanes franchise that they can now be one of those evil, big-money teams that do salary tricks to pay guys more than their cap hit. I never thought that we were going to see that day come. I can't wait to see what Jarvy does for the next eight years!

 

[Bond]

Had no idea you could defer money and it’s insane the the richer teams never use it.

Really depends on how much the signing bonus is at the end but it would have to be hefty to make it interesting for the player due to time value. Not sure how this would work for if he got bought out as well

 

[Big Daddy Cane]

Dundon is cheap.

Oh wait.

 

[Coffees]

why did @Bond say it works differently with buyouts ?

 

[Marc the Habs Fan]

The Coyotes, yes, the COYOTES, did it with Doan.

https://x.com/i/web/status/1829870193201525068

 

[Bond]

why did @Bond say it works differently with buyouts ?

The blurb just says there is risk for Jarvis in case of a buyout.

 

[GKJ]

I never want to hear about tax-free state teams ever again

 

[Coffees]

I never want to hear about tax-free state teams ever again

They’ll still find a way

 

[tmg]

Players wanting their money

Teams would happily offer players more money in exchange for lower cap hit and the player would be a fool to refuse.

If a player has a market value of 7 mil, but a team can offer him 1 mil salary + 10 mil deferred cap free signing bonus, the player would be a fool to resist because he wants (less) money now. He’d take the 11 even with most of it one year late, over the 7.

This would give the deep pocketed teams a huge advantage.

 

[GKJ]

They’ll still find a way

I know that, but the “rich” teams could’ve been doing this for nearly 20 years.

 

[macbowes]

This is absolutely ridiculous, and it seems absurd that every cash-rich team isn't doing this for all of their big name stars. What's the CBA-defined limit to "year 9" compensation that's mysteriously not counting against the cap? Seravalli suggests deferring over $33M over a 40 year period, which says to me that there's effectively no limit whatsoever to the deferred money terms. Can we magically offer Drai $100M in deferred money, getting his cap hit arbitrarily low? With enough money being offered, there's not really a limit to how valuable an offer an owner can make to a player.

This seems to completely circumvent the cap. Am I missing something?

 

[Bond]

Teams would happily offer players more money in exchange for lower cap hit and the player would be a fool to refuse.

If a player has a market value of 7 mil, but a team can offer him 1 mil salary + 10 mil deferred cap free signing bonus, the player would be a fool to resist because he wants (less) money now. He’d take the 11 even with most of it one year late, over the 7.

I don’t think an extreme contract like that would be allowed though. The cap hit doesn’t hit in the 9th year but the contract would have to follow current standards.
It’s probably more like a guy is worth 5maav and he is taking a big signing bonus that will get his hit down to 4.5 or something.

 

[TheReelChuckFletcher]

If you make the deferred salaries too large, then you really get into true cap circumvention territory. I like that the Jarvis and Slavin contracts only have a sliver of it so that the difference in cap hit is only a few hundreds of a thousand per year. The NHL will eventually need to regulate how large the deferrals can be so that the Rangers can't sign Panarin to, say, a $5M AAV extension with $100M in deferred payments, or something like that.

 

[Armourboy]

Yeah not seeing what would keep a guy like McDavid from say doing a 5 million dollar one year deal with 20 million in deferred money. I mean I guess there is less safety, but then a deal like that is also buyout proof.

 

[Big Daddy Cane]

From July 1st:

https://x.com/i/web/status/1807752015067447769

 

[tmg]

If you make the deferred salaries too large, then you really get into true cap circumvention territory. I like that the Jarvis and Slavin contracts only have a sliver of it so that the difference in cap hit is only a few hundreds of a thousand per year. The NHL will eventually need to regulate how large the deferrals can be so that the Rangers can't sign Panarin to, say, a $5M AAV extension with $100M in deferred payments, or something like that.

So it’s the Kovalchuk situation all over again. The league allows teams to inch a loophole more and more with each succeeding contract until one day they feel they have to say “this one went too far” and crack down on that team?

 

[Jerkob Slavin]

So Canes out of cap space ?

Pretty much, but will have a TON next summer as a few contracts expire for older players.

 

[Le Barron de HF]

The Coyotes, yes, the COYOTES, did it with Doan.

https://x.com/i/web/status/1829870193201525068

Surprised it was Doan before and slipped under the radar

 

[Bond]

So it’s the Kovalchuk situation all over again. The league allows teams to inch a loophole more and more with each succeeding contract until one day they feel they have to say “this one went too far” and crack down on that team?

Assuming the contract still has to follow the outlines of current contracts the extreme limit is already known.

 

[AcerComputer]

Not even a question of bylaws, but basic math terminology - AVERAGE annual value is, by definition, the average - total compensation divided by years of contract. If it’s a 63.2m contract that spans 8 years, by definition it has an aav of 7.9. If there’s compensation outside the bounds of the contracted period (like a ninth year) then it’s pure circumvention.

If the Devils were stripped of a pick for a legal contract at the time for cap circumvention, I can’t wait to see the punishment for this.

What would stop teams from extrapolating this to a one year contract? “Oh he’s only signed for 1 mil salary, but he has an 8 mil bonus next summer that’s cap free!”

I never understood why the Devils were punished if the league never approved the contract. And if they had a problem with it they shouldn't have approved it. So in either case cap circumventing is not possible.

 

[TheBeastCoast]

Yeah so this basically comes down to it being legal circumvention until some day a team gets to bold with to high end of a player and the league says "nope, not anymore" and takes draft picks lol good on the Canes though.

 

[TheReelChuckFletcher]

Yeah so this basically comes down to it being legal circumvention until some day a team gets to bold with to high end of a player and the league says "nope, not anymore" and takes draft picks lol good on the Canes though.

I think it's an easy thing to regulate in the next CBA. Just limit how large the salary deferrals can be in a given contract in terms of percentage of the money in the contract.