Earlier this week, a report from The Fourth Period’s David Pagnotta indicated that the Hurricanes and RFA winger Seth Jarvis were nearing an agreement on a long-term contract. That is indeed the case as the team announced that the two sides have reached an eight-year, $63.2MM contract. GM Eric Tulsky released the following statement:
Seth is a cornerstone player for our franchise. He took another huge step last season, playing in all situations and displaying the skill and competitive drive that will make him a star in this league in the years to come.
Typically, the AAV of a contract is the total value divided by the number of years which in this case would be $7.9MM. However, Daily Faceoff’s Frank Seravalli (who first reported the deal) reports that there is a deferred signing bonus payment due July 1st, 2032, a day after the expiration of the agreement. By doing so, the contract’s AAV will actually check in at $7.5MM. Chris Johnston of TSN and The Athletic adds (Twitter link) that the deal contains $30MM of signing bonus money, the breakdown of which is not yet known.
The contract will cover the four remaining RFA-eligible seasons plus his first four seasons of UFA eligibility. It’s only those last four years that will be eligible for trade protection.
The 22-year-old was selected 13th overall by the Hurricanes in 2020. Jarvis spent his post-draft campaign in the WHL and then made the jump to the NHL at 19. He put up 17 goals and 23 assists in 68 games in his rookie season and followed that up with 14 goals and 25 helpers in 82 games in his sophomore campaign.
Last season was a breakout performance for Jarvis. He set career-highs with 33 goals and 34 assists in 81 games while averaging 18:45 per night. His 67 points were good for second on the team in scoring behind only Sebastian Aho. Jarvis was also one of Carolina’s top scorers during the postseason as he had five goals and four helpers in 11 contests, putting him third in team scoring. That certainly gave him some extra bargaining power heading into contract negotiations.
Carolina went into these discussions with roughly $6.44MM in cap space, per PuckPedia so this agreement will put them around $1MM over the Upper Limit. However, with Jesper Fast expected to miss the entire season after having neck surgery, the Hurricanes will be able to put him on LTIR, getting them back into cap compliance. They can also opt to carry a roster with fewer than the maximum of 23 players which would allow them to get under the Upper Limit that way and still bank in-season cap room.
Contracts with deferred money are quite rare in the NHL but it’s actually the second time Carolina has used it this offseason. Seravalli notes in his report about Jarvis’ contract that there is some deferred signing bonus money in Jaccob Slavin’s contract as well, one that moves the AAV from the reported $6.461MM to $6.396MM. These structures have been approved by the NHL so there won’t be any concerns about this contract getting vetoed.
Johnston noted (Twitter link) that multiple teams attempted to use this structure in talks this summer, including Vegas in their attempts to re-sign Jonathan Marchessault. With Carolina now successfully doing this twice, it will be interesting to see if it results in an uptick in these types of agreements moving forward.
Photo courtesy of USA Today Sports Images.
Seems like an overpay to me? I’m betting they’ll be trying to move some of it sooner or later. Probably sooner?
If it’s an overpay and it’s an 8 year deal you can’t move that anytime soon.
Overpay? Haven’t seen him play, have you?
I’d say this is a bit of an undervalued deal. This will take him to age 30, by year 4 this will be a bargain.
Fair Deal.
Rod says, “He’s got the dawg in him.”
With a scoring touch and no fear to get dirty, this is a great deal.
Is the bonus after the contract ends something we’ll see more often? Seems like an exploitable loophole.
Seravalli goes into that in some depth on Daily Faceoff. While this does shave a bit of AAV, this doesn’t seem like a huge cap savings given what seems to be possible. This seems more like keeping Svechnikov ahead of Jarvis on the AAV schedule.
Interesting this is the same agent that had Aho sign an offer sheet with Montreal. Johansson now represents Carolinas two highest paid players.
This should be about the same deal for Raymond. Was Jarvis being used as a Center? But Ramond’s production is better, so it should still be very close to the same deal.
Maybe Waddel offer sheets’ Raymond????
Jarvis can take faceoffs when needed but other than that he’s exclusively been a winger in the NHL.
Excellent cap management and business deal by CAR GM Tulsky to defer some of the signing bonus to after contract end, lowering cap hit. In eight years, the end of contract lump sump deferred signing bonus will be less impactful due to cap ceiling increases.
Very fair deal for team’s second leading scorer with upside potential with much toughness – he played last season with a torn labrum putting up 67 pts while only missing 1 game and logging 18:25 per game. If anything, its less than the going rate – thought it would come in over $8M/yr
So you guys think that lowering the cap hit by one million a year and then taking one big hit at the end is good cap management? OK, I guess if you’re happy I am. I personally think that robbing Peter to pay Paul is stupid. If I read it right that means he’ll have an 8 million dollar cap hit when this deal is over.
But of course! Here’s why, besides the benefit of deferred bonus impact dilution due cap ceiling growth I mentioned in previous message:
1. We’re talking about a business with a valuation of $980M that is growing rapidly (59% year over year in 2023 per Forbes) and is developing multiple new revenue streams, like betting and entertainment venues, I strongly suspect that finding $8M in 8 yrs will not be a problem.
2. With Jarvis’ new contract, Carolina has only $750K in cap space per Puckpedia; adding an additional $1M to that number plus Fast’s $2.4 LTIR would give Carolina flexibility to make a quality pickup since teams above the cap must soon try to shed salary to get cap compliant
3. There’s also the possibility that Jarvis signs an extension down the road that builds in the deferred bonus, spreading it out over multiple years (in addition to a likely raise)
4. I hope this doesn’t happen, but Jarvis could be traded down the road at his peak value garnering some valuable talent in return. Carolina might need to retain some of the deferred bonus contractual obligation, but some is still better (less) than all.
Suggest that the near-term benefit of raising cap space by about 32% ($2.4M +$775K = $3.1M, plus additional $1M equals $4.1M, $1M/$3.1M = 32.2%) at this point in the year is the primary consideration. Lots can change in eight years. Do what it takes to be a champion now
Puckpedia updated the Jarvis contract structure today. It is much different than we (I) have been talking about. Carolina cap space now shown by Puckpedia as just $80K
Puckpedia today shows Jarvis contract total deferred compensation as $15.67M. Deferrals only in 1st 3 yrs at $4.75M first two years and $5.77M in the third year. Accordingly, compensation received year 1 (e.g. minus deferred amount) $6M, year 2 $6M, year 3 $6.48M. Salary bonuses paid in 1st 3 and last 2 yrs, averaging $3.48M per year over 8 year contract. Salary bonuses total $29.44M or 49.6% of total contract value. An interesting contract.