Thursday, February 07, 2008

Souray and Salary cap/RFA offer sheet notes

(1) I have seen a few mentions around the blogs, in the comments, regarding buying out Souray's contract. If the Oilers are determined to dump Souray (which I don't think they are), they may not have many options besides a buyout. Obviously the first move would be to trade him if possible. If no one wanted him, he cannot be sent to the minors dues to his NMC (at least, not without his consent). Depending on his injury status he may qualify for LTIR, which would be ideal for EDM from a cap perspective - provided EDM is willing to spend his money again on a replacement - though they would still have to pay him all his money. IF EDM were to buy out Souray they would have to pay ~ $13.8 mil in cash, spread out evenly over 8 years. The following would be the resultant cap hits:

1: $879,166.67 (Year 1 = 2008/9 season)
2: $1,629,166.67
3: $2,629,166.67
4: $2,629,166.67
5: $1,729,166.67
6: $1,729,166.67
7: $1,729,166.67
8: $1,729,166.67

That is a lot of money/cap hit, and you still have to replace Souray. Can you do better on the UFA market than Souray for 4.5 mil next summer (5.4 mil - 0.9mil cap hit for Souray's buyout)? Maybe/probably.

What about in year 2, with 3.8 mil avail? Or years 3 and 4, with 2.8 mil avail? Plus you'd be stuck with a cap hit of 1.7 mil for the 4 years after that.

(2) The Star projects a ~ 3 mil rise in the cap next year, which would place the cap at ~ 53.3 mil.

Given that cap increase, the following would be the new RFA compensation chart:

Compensation Due
$819,571.74 OR LESS None
$819,571.74 $1,241,775.56 3rd round pick
$1,241,775.56 $2,483,551.12 2nd round pick
$2,483,551.12 $3,725,325.62 1st and 3rd round pick
$3,725,325.62 $4,967,101.17 1st, 2nd, and 3rd round pick
$4,967,101.17 $6,208,879.91 Two 1st's, one 2nd, one 3rd round pick
$6,208,879.91 OR MORE Four 1st round picks

I also wanted to note something that I wasn't aware of that perhaps others didn't know either, with regards to RFA offer sheets. Section 10.4 of the CBA states:

The number and quality of draft choices due to the Prior Club shall be based on the average annual value contained in the Principal Terms (as defined in Section 10.3.(e) hereof) of the New Club's Offer Sheet (determined by dividing such compensation by the lesser of the number of years of the Offer Sheet or five),...


Meaning that, given the above RFA compensation grid, a 10 year 60 mil deal would be worth 4 1sts as compensation for declining to match an offer sheet to Pitkanen, while a 5 year 30 mil deal would be worth 2-1sts, 1-2nd, and 1-3rd.

6 Comments:

Blogger Vic Ferrari said...

Sorry about bumping your post speeds. Barely anything gets posted here for weeks and then you and I post within minutes of each other.

Must be the ownership change making our moods more buoyant.

On point: Yeah, buying out Souray, or Roloson for that matter, just doesn't make sense when you look at the numbers like this.

I don't think either are terrible either, just signed to too much coin.

Isn't the NMC for Souray just for the first 3 years of the deal? Or did I here that wrong?

If the Oilers are truly a cap team (and I'm not sure that they are) and they are disappointed with Souray (and I don't think that they are), then it would make more sense for them to convince Souray to have a phantom long term back injury.

I mean if it was made clear to Souray that if he stayed with the Oilers he'd get scratched regularly and play in the bottom pairing, and get blamed for any and all Oiler failures that could conceivably be traced back to him ... or he could start feeling a twinge in his back, or unexplained dizziness and nausea, and take his full pay, his family and his dignity and go live in California ... I think he'd probably opt for that second choice.

Again, I don't think that the Oilers are contemplating this sort of thing with Souray, but that may change in future, and one hopes that the Oilers are now one of the teams that can make mistakes disappear with money.

2/07/2008 3:31 pm  
Blogger speeds said...

Yup, Souray's NMC is only for the first 3 seasons, after which he'll be making 4.5 mil for each of the last 2 seasons with a 5.4 mil cap hit.

2/07/2008 3:38 pm  
Blogger Slipper said...

Token stupid question speeds, but does the cap hit remain the same even if a dude's moved out with two seasons left at say 4.5 million?

Vic, don't you think fucking with Souray through a buy out or any of the crazy methods that you've metioned just further sully the Oilers' rep in the eyes of prospective players? With a new ownership we can distance ourselves from "divorce your fucking Wife, Gawd!", but to dick around the only "big name" that's inked a deal in EDM in ages? I suspect players and agents talk.

2/07/2008 4:50 pm  
Blogger speeds said...

Slipper:

If the Oilers bought out Souray after 3 years, his resultant cap hits would change. In Souray's case the year 4 and 5 of the initial contract, years 3 and 4 of the 8 years I laid out in the post, would be slightly lower if you buy him out after 3 years than they would be if you buy him out after one year.

Year 1 (2010/11): 2.4 mil
2: 2.4 mil
3: 1.5 mil
4: 1.5 mil

2/07/2008 5:07 pm  
Blogger Vic Ferrari said...

Vic, don't you think fucking with Souray through a buy out or any of the crazy methods that you've metioned just further sully the Oilers' rep in the eyes of prospective players?

Well first off, I agree with speeds that I don't think the Oilers should be looking at doing anything with Souray right now anyways. He's not going to outperform his contract, but pinning all of the Oilers problems on that one deal seems to be a wild simplification to my mind.

Immediate contention just isn't in the cards for this team anyways IMO. If, in year 4 of the deal, they send him to the AHL to clear up cap space, would that send the wrong message to NHL players? I don't think it would, the opposite in fact, it's speaking to the team's willingness to swallow bad contracts in order to compete.

And N.J, BOS and PHI have all taken the "suspiscious career ending injury to wildly underperforming player" route before. Has it made them less desirable UFA destinations?

2/08/2008 11:09 am  
Blogger JJ said...

Should there be a Salary Cap in Football?
Personally I think there should be! It’s just getting to be stupid money in football at the top of the premiership!
It’s always the same teams at the top proving that football success is based purely on money which ruins the idea of it being a sport! They’ve done it in rugby, basketball, hockey and American football and it makes the sports more competitive and better to watch!
I do a little Spread Betting from time to time and most matches don’t hold much surprise who is going to win, its boring! I want to see a team at the bottom pulling off an amazing season beating last seasons winners in a close fought battle!
Make things fair! It shouldn’t be about money!
Plus!
All there is all that money in the premiership and barely any of it stays in the UK so it’s not even helping the economy!
From my Spread Betting, if I ever win big (which is never, I’m unlucky) it’s still nothing compared to the average premiership players weekly wage!
This Rant was brought to you by Spread Betting Spike. 

4/15/2008 8:15 am  

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