Malkin signs 8 yr/76m Contract Extension

[Rylan]

Is the deal 9.5 each year, or is there any variation by year? I know the new CBA limits back diving deals, but not completely.

If it is 9.5 per year, I wonder why they didnt try to do something a bit front-loaded to keep the cap hit down. My understanding of the new CBA is you can have no more than 35% variation year by year, and the lowest year can be no less than 50% of the highest year. I wonder if the Malkin camp would have accepted something like this: 12 - 12 - 12 - 9.0 - 8.0 - 6.0 - 6.0 - 6.0.

That comes out to 8 years, 71 million, cap hit of 8.875 per year. The time value of 12 million over 9.5 million for the first 3 years, if invested relatively conservatively at just under 8% would give an extra 2 million for the first year salary bump, around 1.7 million for the second year salary bump and around 1.3 million for the third year salary bump over the term of the contract. These are rough estimates with yearly compounding interest rather than continuous or monthly compounding interest. It would probably require some tweaking to get the figures everone would be ok with, but a few hundred thousand saved against the cap could be helpful down the road. This set up would net the functional equivalent of almost exactly 76 million over 8 years once you factor in the time value of the increased salary for years 1 through 3 and it saves 625k against the cap hit.

Either way, I'm happy to have the big man in the Burgh for the foreseeable future.

Cap in hockey is different than football. In football it varies, in hockey the cap is the average of the total amount divided by the number of years.

[SubtropicalPenguin]

Is the deal 9.5 each year, or is there any variation by year? I know the new CBA limits back diving deals, but not completely.

If it is 9.5 per year, I wonder why they didnt try to do something a bit front-loaded to keep the cap hit down. My understanding of the new CBA is you can have no more than 35% variation year by year, and the lowest year can be no less than 50% of the highest year. I wonder if the Malkin camp would have accepted something like this: 12 - 12 - 12 - 9.0 - 8.0 - 6.0 - 6.0 - 6.0.

That comes out to 8 years, 71 million, cap hit of 8.875 per year. The time value of 12 million over 9.5 million for the first 3 years, if invested relatively conservatively at just under 8% would give an extra 2 million for the first year salary bump, around 1.7 million for the second year salary bump and around 1.3 million for the third year salary bump over the term of the contract. These are rough estimates with yearly compounding interest rather than continuous or monthly compounding interest. It would probably require some tweaking to get the figures everone would be ok with, but a few hundred thousand saved against the cap could be helpful down the road. This set up would net the functional equivalent of almost exactly 76 million over 8 years once you factor in the time value of the increased salary for years 1 through 3 and it saves 625k against the cap hit.

Either way, I'm happy to have the big man in the Burgh for the foreseeable future.

Cap in hockey is different than football. In football it varies, in hockey the cap is the average of the total amount divided by the number of years.

Yes, I understand the cap is the average of the total salary divided by the years. What I was asking, inartfully, is whether anyone knows if the new Malkin contract is front loaded in salary by year or not. I know the cap hit stays the same, but the player gets more value out of getting the money upfront. Hence, you can generally get them to take a lower total salary over the course of the contract if you front load the contract a bit. If the salary is simply 9.5 per year for each year of the contract, it seems likely the Pens could have got a little bit of cap relief by taking advantage of the ability to front-load contracts slightly under the new CBA (obviously, not to the same extent as the old CBA).

[slappybrown]

Its relatively flat according to Dreger. He did get a 10mm signing bonus this year.

[Rylan]

Oh ok I understand you now...in that case I am not sure.

[murphydump55]

Yes he will lack experience. But he is a bigger version of Letang, and is American so less prone to stupidity, and much cheaper than Letang for a long time.

Just curious why being American makes him less prone to stupidity? LOL

This should be interesting, please enlighten.

Because in Canada, the plebians play hockey, just like in the US the plebians play football. Therefore there is a much higher percentage of pleb canadian hockey players than american.

Yes, that's brilliant. Haha, wow.

[Shakes]

That is really coherent english for Malkin. Color me skeptical on the idea that that was a direct quote.

Hmm. I think "My heart pushed me so hard" is a very Malkin-like quote.

[no name]

Letang won't be traded until the pens are done signing or cutting ties with free agents/. Once that is done we can see the holes in the line up we need to fill.

[skullman80]

Letang won't be traded until the pens are done signing or cutting ties with free agents/. Once that is done we can see the holes in the line up we need to fill.

Wouldn't that be after the draft though?

[Desiato]

Letang won't be traded until the pens are done signing or cutting ties with free agents/. Once that is done we can see the holes in the line up we need to fill.

It's the other way around. The Pens need to know Letang's status ASAP to prepare for his departure if they intend to trade him before the season; which is my assumption, if they cannot agree on terms. The best time to do so is on or before draft day when the greatest number of players are available.

My guess is the Pens have a target range, and if that does not appear achievable, they'll begin shopping him right away.

[DontToewsMeBro]

I think he gets dealt at the draft, when his stock is definitely the highest/teams are most likely to make moves. If Shero has shown us anything it's that he's a god damn magician with these kind of deals.

[The Snapshot]

So the Penguins locked up two of the best players in the game, who are both young and potentially improving on their THIRD NHL contracts for a grand total of $800K per year? That is actually amazing.

The more I think of it, the more I realize that these deals have almost zero impact on the raises they want/need to pay to the UFAs still on the team.

I think Shero will work his magic, and I don't believe that the idea of trading Letang is a certainty. The Cap will be going up the year after next and the Pens would have only a short-term issue with Letang's salary next year if the extend him. Couldn't they also just let him play it out and try to sign him in his exclusive rights period between the end of the season and the start of FA next summer?

I mean, it could be a wink, wink kind of agreement that the Pens simply cannot eat a huge cap hit for him next year if all parties really want to keep it together here.

[Guinness]

The way some people go on about the Wings around here, you'd think they'd won every Cup since the '05 lockout.

The mighty Wings have won exactly 1 Cup with Datsyuk and Zetterberg as their premier players, both of whom are now in the twilight of their careers. Seems like there were a few early/easy outs in the meantime, too. The obvious lesson there is that even with an admittedly elite organization, nothing is guaranteed. If Red Wing fans behaved like Penguin fans (and maybe they do), they'd be entitled to a lot more rage than we are... By my math, Crosby and Malkin are comfortably in their prime, with 1 Cup already under their belts.

It would have been nice to win this year, for sure. But it's not like it's been a decade since they won, either.

[Mr. Colby]

He's locked in at 3.5 next season no matter what... wink wink agreement is not necessary. Just as Geno is still 8.7 for next year.

[Getting To My Game]

Disappointed.

[Crankshaft]

Disappointed.

Why?

[no name]

Is the deal 9.5 each year, or is there any variation by year? I know the new CBA limits back diving deals, but not completely.

If it is 9.5 per year, I wonder why they didnt try to do something a bit front-loaded to keep the cap hit down. My understanding of the new CBA is you can have no more than 35% variation year by year, and the lowest year can be no less than 50% of the highest year. I wonder if the Malkin camp would have accepted something like this: 12 - 12 - 12 - 9.0 - 8.0 - 6.0 - 6.0 - 6.0.

That comes out to 8 years, 71 million, cap hit of 8.875 per year. The time value of 12 million over 9.5 million for the first 3 years, if invested relatively conservatively at just under 8% would give an extra 2 million for the first year salary bump, around 1.7 million for the second year salary bump and around 1.3 million for the third year salary bump over the term of the contract. These are rough estimates with yearly compounding interest rather than continuous or monthly compounding interest. It would probably require some tweaking to get the figures everone would be ok with, but a few hundred thousand saved against the cap could be helpful down the road. This set up would net the functional equivalent of almost exactly 76 million over 8 years once you factor in the time value of the increased salary for years 1 through 3 and it saves 625k against the cap hit.

Either way, I'm happy to have the big man in the Burgh for the foreseeable future.

Cap in hockey is different than football. In football it varies, in hockey the cap is the average of the total amount divided by the number of years.

Yes, I understand the cap is the average of the total salary divided by the years. What I was asking, inartfully, is whether anyone knows if the new Malkin contract is front loaded in salary by year or not. I know the cap hit stays the same, but the player gets more value out of getting the money upfront. Hence, you can generally get them to take a lower total salary over the course of the contract if you front load the contract a bit. If the salary is simply 9.5 per year for each year of the contract, it seems likely the Pens could have got a little bit of cap relief by taking advantage of the ability to front-load contracts slightly under the new CBA (obviously, not to the same extent as the old CBA).

Well its still a moot point as the new CBA says the highest year can only by half of the lowest year. so even if you pay 12 one year the last year will still cost you 6. But if that player retires before he reaches the last year does he still count on the cap the past year?? if you do count on it its the cap average. Even if you trade the player and he is only owed 6, that club will have him count his cap hit.

[The Snapshot]

He's locked in at 3.5 next season no matter what... wink wink agreement is not necessary. Just as Geno is still 8.7 for next year.

I realize that, but the wink would simply be that Letang wants to stay here for a fair price and term - after the salary cap for next year is set.

There wouldn't be any binding handshake or anything, but and exchange of parameters so that each felt there was a deal to be made once it is certain that the Cap goes up the season after next. I'm not big on the contract side of things, so I really am not sure when the Cap for the subsequent season gets set - and if that is before we lose exclusivity.

Letang's camp should be willing to at least have the parameter discussion, if he does in fact want to stay and also understand that the Pens can pay him more if the Cap is goinig up.

[Pitts]

I think he gets dealt at the draft, when his stock is definitely the highest/teams are most likely to make moves. If Shero has shown us anything it's that he's a god damn magician with these kind of deals.

Me too. Dealt at the draft, the Pens get back into the first round and pick up some nice young wingers in the deal too.

[Pitts]

It would have been nice to win this year, for sure. But it's not like it's been a decade since they won, either.

I'm just mad that Boston and Chicago are back there before the Pens.

[Idoit40fans]

I can't even find a trade partner I like out there to send him.

[joopen]

I can't even find a trade partner I like out there to send him. :scared:

Nope. I've been looking too

Maybe Montreal centering around Gorges and Galchenyuk or Gallagher or Columbus with Nikitin and Atkinson? There just doesn't seem to be a good deal out there but that's why I'm not an NHL GM.

[newarenanow]

Disappointed.

Why?

He likes to be controversial and get attention.

[sil]

Letang for Subban.

Spoiler:

MUHAHAHAHAHAHA.

[BigMcK]

Call Anaheim, start with Cam Fowler and go from there.

[saveourpens]

- edit