While trades have been few and far between in the NHL this season, many GMs have been busy locking up their players to contract extensions.
When the Nashville Predators announced the signing of center David Legwand to a six-year, $27-million contract Dec. 7, it marked the 24th player to sign an extension that begins with the 2008-09 season.
Some of those signed to extensions, such as Pittsburgh’s Sidney Crosby, Anaheim’s Ryan Getzlaf and San Jose’s Matt Carle, are players who were not even going to be eligible for salary arbitration in the summer of 2008. However, since the Edmonton Oilers submitted offer sheets to Thomas Vanek and Dustin Penner last summer, NHL GMs have made it a priority to lock up their top young players.
Don’t expect the pace of contract extensions to slow in the coming weeks, either. As of Jan. 1, any player on a one-year contract will be eligible to sign an extension and I can tell you from personal involvement that negotiations are underway for several players, including both potential Group 2 (restricted) and Group 3 (unrestricted) free agents.
In fact, in the past week alone, our office has had negotiations with at least eight teams regarding players who will be free agents as of July 1, 2008 and we are hearing of several other negotiations taking place. This has traditionally been a slow time of year for contract negotiations, but teams are taking a proactive approach with several players now to get them signed for next season and beyond.
In fact, approximately 56 percent of players currently on an NHL active roster are already signed for next season, which is a much higher number than normal for this time of year.
The 30 NHL teams have already committed just under $1 billion in 2008-09 compensation to the more than 400 NHLers under contract for next season. A year ago at approximately the same time, the total dollars committed to NHL players for the 2007-08 season was barely more than $800 million.
All of this will make for a very interesting unrestricted free agent marketplace. While there won’t be as much money available for those players who become UFAs on July 1, 2008, there will also be much less supply than usual.
Some of the top players scheduled to become unrestricted free agents on July 1 include Joe Sakic, Marian Hossa, Mats Sundin, Nicklas Lidstrom, Wade Redden and possibly Jaromir Jagr (who must either win a major award or record at least 84 points this season while the Rangers have to win at least one playoff round in order for him to have the right to exercise the option year in his contract).
Of course, the other unknown factor is the amount of the 2008-09 salary cap. While it is too early to speculate what that number will be, revenue growth of five percent would leave the upper limit just short of $53 million. With a little more robust growth, the upper limit could reach $55 million, which means the lower limit would be $39 million. Ironically, that $39 million figure was the upper limit in the first season after the lockout.
After Wade Belak scored a rare goal Dec. 4 against Nashville, he joked that he was going to ask for scoring bonuses in his next contract.
Not only was he joking, the Collective Bargaining Agreement does not allow Belak to have a scoring bonus as only a select few players are allowed to have performance bonuses in their contracts.
Article 50.2 of the CBA limits bonuses to those players on entry level contracts or for those who sign one-year contracts and are 35 or older as of June 30 in the year in which the contract is to be effective.
A third type of player who can have a performance bonus is one who has played at least 400 NHL games (games dressed as a backup count for goalies), signs a one-year contract and who spent at least 100 days in the previous year on injured reserve.
It is this final exception to the no-bonus rule that allowed Michael Peca to sign a contract with the Columbus Blue Jackets that includes bonuses for games played and for the team qualifying for the playoffs.
As the firm – through agents Patrick Morris and Mark Guy – that negotiated David Legwand’s contract extension with the Nashville Predators, I guess we should be flattered that only three percent of THN online readers feel he is worth more than the deal he recently signed.
As with all long-term contracts, we always run the risk a player could be trading away future dollars in exchange for security and that issue is even more common today with the trend towards longer contracts for young players.
Rand Simon is an NHLPA certified agent. He has spent the past 14 years with Newport Sports Management Inc.