Countdown to July 1
NHL Free Agency: Demand Outweighs Supply
By Carl Danbury (Posted June 27, 2008)

Any NHL fan worth his/her salt will keep a watchful eye on every Internet site looking for any bit of news, rumors or announcements concerning signings of restricted and unrestricted free agents Tuesday.

Speculation runs rampant prior to and during the free agency period. In this new era of the NHL, when players can become free agents at the age of 27 after their existing contracts have expired, the demand typically outweighs the supply and desperate teams looking to improve their lot in life typically are forced to overpay for a coveted player that can improve their team immediately.

Yet, teams with little cap space or those that fear entering into long-term contracts with free agents typically scrape the bottom of the free-agent barrel hoping for a miracle that their new acquisition will outperform expectations. Some teams’ general managers have a decent track record of signing free agents that pay dividends, while others seem to have little grasp on signing players that can help their teams immediately, or for the long term.

While SportsUnlimited contacted four general managers for their comments about the upcoming free agency period, none were actually interviewed. As a result, we focused on speaking with the agent for several free agents who will hit the marketplace on Tuesday.

Matt Keator, a Wellesley, Mass.-based agent who represents free agents Ron Hainsey, Pavol Demitra and Ladislav Nagy, has had success landing his clients in locations that fit their needs both on- and off-the-ice. Keator found Zdeno Chara a home with Boston two summers ago, and negotiated deals for clients Mike Komisarek, Chris Higgins, Yan Stastny, Michal Handzus, Paul Stastny and Blake Wheeler.

Keator, who scouted for the St. Louis Blues for eight seasons, also was interviewed for general manager positions with the Pittsburgh Penguins and Boston Bruins last year.

SU asked Keator if he believes that free agency is the most important period for NHL teams in terms of player personnel since the lockout.

“The age where a player is eligible for free agency went from 31 to 27, so teams own their players for a shorter amount of time. There seems to be more roster turnover due to the salary cap because teams can’t keep all of their players and there are more free agents in the marketplace, although this year there are fewer top-end free agents than before,” Keator said.

“Teams are now locking in their younger players at a younger age and doing that has changed the dynamics of free agency. July 1 is being circled on the calendar with even more importance than before,” Keator said.

With some teams locking down their young stars for six seasons and longer — before their 27th birthday — the bidding war for free agents, who are 27 to 29 years-old like Hainsey, Brian Campbell, Marian Hossa, Kristian Huselius, Brooks Orpik, Michal Rozsival and others, is expected to be fierce.

“There are certain points in a guy’s career where they are in a position to maximize their value, and with the age of free agency going from 31 to 27, it is coming at a younger age,” Keator said. “A guy like Ron (Hainsey), whether it’s with Columbus (his current team) or another team, you want to maximize that opportunity. Prior to the lockout a more cumbersome situation existed. Now, you have an opportunity to capitalize on a longer term of earnings potential. You’re one hit away from losing your career, so you have to take advantage of the system.”

For teams, offering long-term deals to younger players is often a better option than signing older players to short-term deals, Keator said.

“The longer term deals for younger players is better long-term business sense because players have more shelf life when they’re younger. It is going back into that cycle (where teams are tying up long-term financial resources to sign certain players) that we saw before the lockout but the money is being allotted to younger players rather than the older, washed-up ones,” Keator said.

This year, Keator said that the number of high-end free agents is scarce in comparison to other recent years. As a result, players like Hossa and Campbell could be rewarded with record contracts. Recently, Hossa rejected a reported seven-year, $49 million contract offer by the Penguins. He rejected a lesser deal by the Thrashers during the season, which led to him being shipped at the trade deadline to Pittsburgh. 

“Any marketplace is based upon supply and demand, and there seems to be a lot of demand and not as much supply,” Keator said. “There are fewer free agents this year and there is going to be a lot of demand for players on July 1. The volume is down in all areas of the market for players.”

Keator said that he asks his clients to complete an entire matrix of wants and concerns prior to seeking deals with specific teams. He said that each client has specific desires that are more important than others.

“Some guys like the warm weather. Some guys don’t care. Some guys want to go to a team where they can play a lot of minutes. Others want to go to a Cup contender. It varies from player to player. You have to fit the player with the team and the organization that suits him best.”

Some agents and general managers form solid working relationships over the years and occasionally it seems that several players represented by a particular agent wind up with just a few of the 30 teams. Keator said it does happen because negotiating contracts is “a relationship business.” But, Keator said he tries to have solid relationships with all 30 teams so that his clients have options.

“Obviously, a relationship might open a door or two for them (clients), but ultimately it’s where the player wants to play and wants to live, and what they want to do with their life,” Keator said.

Some teams in the Southeast may have an advantage in attracting free agents due to climate, potential for ice time and playing with or against some of the brightest young stars in the league.

“The Southeast definitely has some exciting stars in that division, that’s the first thing that leaps to mind. You’ve got Ovechkin, you’ve got (Eric) Staal, you’ve got Lecavalier, St. Louis, you’ve got Backstrom and Kovalchuck. It’s not as competitive as some divisions because only one team made the playoffs last year,” Keator said.

On the other side of the coin, however, is the fact that three Southeast teams have new head coaches (Florida, Tampa Bay and Atlanta), two have new ownership groups (Nashville and Tampa Bay) and only Carolina and Tampa Bay have made it past the first round of the Stanley Cup playoffs since the 1998-99 season.

Every Southeast team has roster holes to fill. Examining the rosters of each team indicates that the teams with new head coaches have the most pressing needs. Whether or not Atlanta, Florida or Tampa Bay can attract some of the high-end free agents beginning July 1 is in serious doubt.

Washington and Nashville made the playoffs last season, and Carolina missed by one game. Each of those three teams seem poised to make another run at a playoff berth next year. While the salary cap structure for the 2008-09 season has been adjusted upward again (salary range for the 2008-09 season provides for a lower limit of $40.7 million, an adjusted midpoint of $48.7 million and an upper limit of $56.7 million), that doesn’t guarantee that any of the six Southeast squads can afford to get into a bidding war for players like Campbell and Hossa, or older stars like Mats Sundin, Brian Rolston or Wade Redden.

Keator said that is difficult to rank one general manager over another in the Southeast, but the two (Carolina’s Jim Rutherford and Tampa Bay’s Jay Feaster) who have won a Stanley Cup have an edge because of their past success.
 
“You just have to point to the ones who have won a Cup,” Keator said. “Rutherford has done very well. His name having been mentioned for the Toronto job — that says a lot about him,” Keator said.

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What Does Your Team Need?
Each of the six Southeast teams has cap room, with the Thrashers having the most leeway due to the departure of four regulars in the line-up and several role players. It wouldn’t be a great surprise to see GM Don Waddell try to pull a high-priced free agent into the fold to bolster the center position or along the blueline. One perceived problem is that Hossa wouldn’t re-sign during the season, which led some to question the Thrashers’ commitment to winning. Without a few solid free agent acquisitions during the summer, Atlanta’s commitment to winning will be questioned with even more fervor.

• Ilya Kovalchuk needs a No. 1 center to feed him the puck
• A stay-at-home defenseman who can skate wouldn't hurt
• While we're at it, how about another scoring threat on the wing?

Carolina’s roster has two gaping holes on the blueline with the retirement of Glen Wesley and the departure of Bret Hedican. While we don’t expect the Canes to compete for Campbell’s services, we wouldn’t be shocked to see Hainsey, Rozsival or Paul Mara wind up in Carolina.

• A solid, two-way defenseman under the age of 33
• A back-up goaltender
• A winger who can score

In Florida, restricted free agent defenseman Jay Bouwmeester has been tendered a qualifying offer, but some have speculated that the former first-round pick will be wooed with a big offer from a Western Conference team. The Panthers need more scoring and the departures of Olli Jokinen and Jozef Stumpel certainly doesn't help new coach Peter DeBoer's attack.

• A playmaking center
• A winger who can score
• A power forward who doesn't mind mucking it up in the corners

In Nashville, general manager David Poile has concentrated on re-signing restricted free agents and one last hurdle is getting Ville Kostinen under contract. Poile needs at least one more scorer on either wing and a rough-and-tumble forward to complement Jordin Tootoo would be a bonus.

• A playmaking center
• A tough, gritty forward
• A capable back-up goalie

Tampa Bay needs to acquire depth at center and on defense. We expect new ownership to allow Feaster to make a splash with one major free agent signing, but the Lightning will be more apt to acquire the services of less expensive role players.

• A playmaking center
• A checking line center
• A stay-at-home defenseman to be paired with offensive-minded Dan Boyle (Bryce Salvador fits)

Washington is in excellent shape heading into free agency with the one glaring hole in net. Free agent Cristobal Huet, who was acquired from Montreal at the trade deadline, had not been signed as of June 27, but general manager George McPhee has options if Huet doesn’t come to terms before Tuesday. It is simply a matter of how much the Caps are willing to pay for a No. 1 goalie, or if they are more willing to take a No. 2 goalie and try to make him a No. 1.Their former No. 1 before Huet’s arrival, Olaf Kolzig, was paid $5.4 million last season, nearly twice what Huet made in 2007-08. McPhee also must sign restricted free agent Mike Green, who like Bouwmeester, could be the subject of raider tactics by other teams' GMs.

• A No. 1 goalie if Huet doesn't sign (Jose Theodore?)
• Depth on defense
• A two-way winger with scoring ability

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Restricted Free Agents

Players that need to be re-signed by their current teams, but are not unrestricted free agents, still may be signed by other NHL teams. In the past, most general managers have been reluctant to break the unwritten code of not trying to sign restricted free agents whose rights were still owned by other teams, but last summer Edmonton's Kevin Lowe made huge offers to Buffalo's Tomas Vanek (the Sabres matched the offer) and Anaheim's Dustin Penner (the Ducks didn't match).

The compensation for signing restricted free agents can be steep, however, shrewd GMs might look at some younger talented players and attempt to "steal" them from other teams. Once a team signs a player to an offer sheet, the player's "original" team has seven days to match the offer or will receive compensation from the player's "new team."  

If the original team chooses to accept, then the contents of the offer sheet become binding. If the original team declines, then all of the terms specified in the offer sheet are binding on the new team and the player and the original team receives compensation.

Restricted Free Agent Compensation

Less than $863,156    none
$863,156 to $1,307,811   third-round pick
$1,307,812 to $2,615,623   second-round pick
$2,615,624 to $3,923,434   first- and third-round picks
$3,923,435 to $5,231,246   first- second- and third-round picks
$5,231,247 to $6,539,061    two first-round picks, a second-round pick and a third-round pick
$6,539,062 or greater    four first-round picks

The amount of compensation is determined by taking the total compensation due in the Offer Sheet, and dividing by the number of years specified in the Offer Sheet, or five (5) - whichever is less.

Here are some restricted free agents who could be offer sheet candidates:

Position	Player	07/08 Salary	Age This Season
Goalie	Pascal Leclaire	$1.050 million	26
Forward	Valtteri Filppula	$733,333	24
Forward	Andrei Kostitsyn	$785,333	23
Forward	Antoine Vermette	$1 million	26
Defense	Jay Bouwmeester	$2.175 million	25
Defense	Mike Green	$833,333	23
Goalie	Jaroslav Halak	$491,667	23
Forward	Pierre-Marc Bouchard	$2.6 million	24
Forward	Marek Svatos	$1.2 million	26
Forward	Matt Stajan	$875,000	25
Defense	Andrej Meszaros	$984,200	23
Defense	Ville Kostinen	$475,000	26
Forward	Nigel Dawes	$496,333	23
Defense	Christian Erhoff	$850,000	26