Jeff Carter's Extension: A Perfect Example of a Clean, Long-Term Contract
Flyers general manager Paul Holmgren continued to take care of business with off-the-ice matters on Saturday when he announced that Jeff Carter agreed to terms to an 11-year, $58 million contract extension.
Given his new deal, Carter will be 36 years old next time he's eligible to hit the free-agent market.
The contract is a very reasonable deal for both sides, as Carter will make his money at a reasonable cap hit of $5.27 million for the Flyers.
It breaks down to: $6 million in 2011-12, $6.25 million in 2012-13, $6.5 million in 2013-14, $6.75 million in 2014-15, $7 million in 2015-16 and 2016-17, $6.5 million in 2017-18, $5 million in 2018-19, $3 million in 2019-20 and $2 million in 2020-21 and 2021-22.
Carter has a full no-trade clause beginning in the 2012-13 season and running through 2014-15, and a modified NTC from 2015-16 through 2021-22.
Because of the Ilya Kovalchuk debacle that took place over the summer with the New Jersey Devils, from this point forward any long-term contract is more likely to spark discussion of cap circumvention.
For those unaware of what took place in New Jersey, let me catch you a bit.
Devils general manager Lou Lamoriello presented the league with a contractual agreement with Ilya Kovalchuk for 17 years, $102 million, but the NHL rejected it on the basis of cap circumvention.
Like most double-digit deals, the contract was heavily front-loaded. Kovalchuk would have earned $95 million in the first 10 years of the deal and only $7 million in the final seven years.
The contract's cap hit was only $6 million, relatively small for a player of Kovalchuk's caliber.
It didn't take a genius to know that Kovalchuk's contract with the Devils was illegal.
Now we have another contract for more than a decade with Carter's extension with the Flyers, and considering Holmgren has been suspected of cap circumvention previously with Chris Pronger, it's safe to assume there will be some questions about Carter's deal.
Before we move forward, the NHL has approved Carter's extension. They've deemed it a legal contract with no circumvention.
However, I've had several queries from readers who believe it was a little bit of circumvention.
To understand what cap circumvention really is, you have to know the definition of circumvention. If you look in the Webster's dictionary, it defines circumvention as a verb: to go around or bypass.
It occurs when a team tries to get the better of the league's salary cap, using a loophole in the system that allows teams to sign a player for a long period of time at a low cap hit to make it easier to fit the player under the cap.
Often times, the player will see a huge drop-off in salary near the end of the deal rather than a slow decrease as the player gets older. In the most suspicuous circumstances, the player in question is either over the age of 35 or will be in their 40s when the contract expires.
Contracts that have been suspected of circumvention are those belonging to Roberto Luongo, Marian Hossa and Pronger; however, since the league approved those deals, they couldn't justify revoking their approval.
Kovalchuk was the NHL's guinea pig to put their foot down on a problem that if they didn't stop would become an easy means of getting around the league's salary cap.
That brings us back to Carter's contract, and the question of if the Flyers committed cap circumvention in re-signing the 25-year-old sniper.
The answer is no, not even close.
Let's go back to Kovalchuk's contract: The 27-year-old lethal goal scorer signed for 17 years. That's nearly two decades, and no one believed that Kovalchuk would be playing hockey at the age of 44.
Carter is only 25, about to enter the prime of his career. It's completely in reason to believe that he will still be playing in 11 years.
Don't believe me?
There are plenty of players still playing at or above the age of 36. For instance, Phoenix's Ray Whitney (38), Ottawa's Daniel Alfredsson (37) and Alexei Kovalev (37), Boston's Mark Recchi (42), Anaheim's Teemu Selanne (40) and Jason Blake (37).
With that settled, let's look at how much Carter will make over the years. Is he making $50 of the $58 million in the first five years, or is it evenly distributed over 11 years?
Carter will see raises for the first four seasons before earning $7 million in years five and six. The drop-off begins after year six; when he turns 33, the money begins to go down.
In the final two years of the deal, Carter will make $2 million. You tell me, that's pretty fair for a 36-year-old center, am I wrong?
To my final point, we all know that the Flyers wanted to work out an agreement with Carter that would be cap-friendly, you could say. And this contract is indeed friendly to the cap for Philly.
The $5.27 cap hit puts Carter in the same earning range of Andy McDonald, Martin Erat and former Flyer Simon Gagne. Not too bad for the Flyers to lock up a 40-goal scorer for relatively cheap.
While the Flyers achieved their goal, they did so fairly. They did not break any rules of the NHL Collective Bargaining Agreement (CBA) and did not try to get around the cap.
They did what the Devils tried to do, but in a legal, fair way. Maybe, just maybe, Mr. Lamoriello can learn a thing or two from Holmgren.
I have yet to mention that the Flyers made it known that this is still captain Mike Richards' team, as Carter will make $11 million less than Richards.
In the last week, Holmgren has locked up two of the Flyers' core players for multi-year contracts. Claude Giroux was first, with a three-year, $11.25 million extension on Tuesday, and Carter was next.
Holmgren has one more player to lock up before he can call it a day at the office, as Ville Leino is set to become an unrestricted free agent on July 1, 2011.
As an interesting note, Holmgren was spotted by the media talking to Leino after announcing Carter's extension.
Homer's a busy man these days.
Visit the Broad Street Scoop for more of Tom's coverage of the Philadelphia Flyers, and the NHL. Follow Tom on Twitter: @Tom_Dougherty. E-mail him at: firstname.lastname@example.org
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