TAKING CARE OF BUSINESS

by Lowetide

Now that Peter Chiarelli has cost certainty on the McDavid deal (woot!) he can safely move on to the next major item: Signing Leon Draisaitl.

CHIARELLI SUMMER LIST

  1. Sign Connor McDavid(8 years, $100 million. $12.5 cap hit annually)
  2. Sign Leon Draisaitl(Still to come)
  3. Negotiate the expansion draft rapids without giving up a valuable piece of the future. (Griffin Reinhart)
  4. Find a way to trade Benoit Pouliot off the roster(Bought him out)
  5. Find a second pairing RHD with two-way acumen(Matt Benning) 
  6. Find a stopgap measure to replace Andrej Sekera’s minutes until he returns(Kris Russell)
  7. Find a C-R who can help the offense and cover off where Leon isn’t at the time and to replace Jordan Eberle if he’s dealt. (Ryan Strome)
  8. Make enough cap room to get everyone in under the number with enough room to spare for the trade deadline(Eberle and Pouliot)

That’s the summer. We have Leon to go and the cap room is there there is there’s someone out there who is of interest.

PROJECTED ROSTER 2017-18

The Oilers have room and Chiarelli will spend (imo) before or during the season to tweak the roster. Who could they add? Reports (Bob) have the Oilers looking for a player who “fits the team” and offers leadership. That could be anything and is deliberately vague, so not much we can do beyond list names until the cows come home. Speed was mentioned, so Brandon Pirri could be a guy to help. If we imagine the Chiarelli template for a Bruin Oiler, it’s pretty easy to see who might be of interest among forwards. Drew Stafford, Alex Chiasson, Jarome Iginla and Shane Doan are all physical wingers who can punish opponents. One area I think PC should be looking? Penalty kill. Here are the top PK men (by TOI per game) among free agent forwards:

  1. Daniel Winnik 2:31
  2. Chris VandeVelde 2:30
  3. Matt Cullen 2:19

I think Pirri and Franson are reasonable bets, Oilers probably end up with a big winger like the ones above.

Photo by Mark Williams

PAL JOEY

Joey Laleggia filed for arbitration today, not sure of the plan here. JL has a shot at spending time in the NHL this season, the contract basically writes itself. The one item about him (increased AHL offense) is a curio, but I’m not sure it gets him paid anything this summer.

MCDAVID

Reading a bunch of things online that are basically insane regarding 97”s contract. Here’s the deal. The outer marker was $15 million (I believe) and he settled for $12.5 million. Eight years, times 2.5, is $20 million. There will come a time when the best players in the game take what they’re worth, and when they do I’m sure we’ll hear even more howls than we have today.

It’s still ridiculous. If McDavid makes $15 million, he’s paid the maximum and a role player must take less money. This is a true fair market situation. What we have today is a class act showing all of us what matters to him. I hope he wins 12 Stanley’s, all in Edmonton.

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Jaxon

admiralmark,

Yup, upon re-readin’, I think you’re correct. Carry on.

admiralmark

Hey Lowetide or anyone. Have we heard a diffinitive reason why Joey Lallegia was moved from D to W? Seems like he was excelling at the PP QB position in College prior to Oilers drafting him.

Put me down as one that would play hardball with Draisaitl if he’s asking for anything north of $8 Million. The majority of his positive track record is playing wing with McDavid. So his contract at this time should reflect a winger that was boosted by the best(maybe 2nd) player in the game. Until he proves he can drive his own line at Center. I wouldn’t offer more then $7.5mill x 8 years. As was suggested above $6 mill x 2 years and then play him at 2C would be something to consider. I absolute love this player and thing he could become a very dominant Center… But there isn’t enough track at this point to know with certainty that’s the player he is.

admiralmark

Jaxon,

Dont wanna speak for Richard SS. But I think he meant $12 mill over 2 years? So $6mill x 2years.

Jaxon

Richard S.S.:
Apparently the Draisaitl Camp is looking for 75% of McDavid’s value.That’s what I’d call excessive.So Chiarelli knows what is possible, and I expect he waits for the “ask” to go down.Those Teams that could afford him and want him should be told – make your best offer and you might get considered.

It all depends on how long the Contract should be.I’d go two years and $12.0 Million total.Draisaitl must prove he’s a super-star to get what he wants.

I think that is a terrible idea. If Leon performs really well, what will the ask on his next contract be? $12M again? Or $12M x 1 or 2 just to get to free agency and bolt. Also, I think it just might be impossible to fit a $12M deal under the cap next season. To get under cap for the 2018-2019 with a $12M Draisaitl contract you’d have to let go of Maroon, Nurse, Letestu, Benning and Fayne for nothing. And Nuge’s return would have to be a contract that is less than 3.7M (think Gudbranson, Gudas, Gallagher, Jenner). I”m not sure you’d get that kind of value back for Nugent-Hopkins. Hopefully, he has a great year and his value shoots up on the trade market. And you’d have to get Strome, Caggiula, Slepyshev to sign for about $6M total, which will be pretty hard if they’re worth keeping.

You’d have these 12 inexperienced players on your starting lineup:
Benson, LaLeggia, Khaira, Gambardella, Rattie, Puljujarvi, Caggiula, Slepyshev, Bear, Paigin, Broissott. That’s over half your team with less than a year or two experience in the NHL.

The rest of your lineup is the NMCs: Lucic, Sekera, Russell, Talbot
Around these players: McDavid, Draisaitl, Strome, Kassian, Klefbom, Larsson, Gudas, Gryba

It would be nice if we could hang onto Nurse and Benning, but that would require at least $3M to $5M in cap space. So Draisaitl signing for $8.5M or less long term instead of a $12M bridge is a pretty big deal.

speeds

Snowman,

Interesting. Considering, from the reports, McDavid asked to take less money, I can see why a person in that position might feel they shouldn’t pay standard agent fees.

At the same time, if the agent was the guy doing all the work coordinating things, actually having all the talks, I can also see why McDavid would think that effort was worth something.

Snowman

I heard Strudwick on the radio today talking about agent fees. Their fees are all different and negotiated by each player.

He said its not uncommon for guys like Connor to have their agent work for free because he’ll get hundreds of other clients because he has Connor Mcdavid. So basically, Jeff Jackson may have got paid big time or he may have gotten jack all yesterday. Only people who know are Jeff Jackson and Connor Mcdavid.

Kinger_Oil.redux

russ99: I have only one wish for the season, that Nuge can play within the system, go to the tough areas and make plays under pressure, and give us tougher two-way play to solidify the second cycle line this season, so Leon can thrive at RW and make up some of Eberle’s goals.

– It’s going to be an interesting season: On paper, all of Drai, Nuge Strome could/should be 2nd line C’s in an ideal roster. I wonder how they will deploy them all?

– If the plan is to trade RNH, you hope he is able to play a prominent role this year, and give Drai more reps as 2nd C. I wish I could represent this graphically but:

1) Leon: 1 RW/2C/PP
2) Nuge: 2C/3C/PP/PK
3) Strome: 3C/1 or 2 RW/PP

– They do have lots of options with these 3 “C” behind McD

russ99

Mike:
I have only one wish for the coming season, I truly hope to see nuge on MCD wing for 20 games. I honestly think that they would play off each other brilliantly.

I have only one wish for the season, that Nuge can play within the system, go to the tough areas and make plays under pressure, and give us tougher two-way play to solidify the second cycle line this season, so Leon can thrive at RW and make up some of Eberle’s goals.

Chachi

Diesel,

Sounds like fun!

Diesel

Chachi: How was the Sulphur Skyline hike? Thinking of doing it later this year.

It is short (3.25 hours round trip) but intense. Quite steep for almost the entire ascent, but a spectacular 360 degree view from the peak. Not many things to marvel at along the way, as it’s a relatively narrow, covered trail, but once you clear the tree line you will appreciate the altitude. Overall, for a short but challenging climb, it’s worth it.

Gayfish

Pretty sure it is lump sum payment, and you pay tax in home team city. Not sure why the league doesn’t standardize tax rates. Why couldn’t they pay all players out of Texas (or wherever taxes are lowest). I did the math once, but I forget exact numbers. Some teams get 3.5+ million in extra cap power due to tax rates.

California taxes you on the game, but takes the rate as your annual income. At least that was the case in the 2016 superbowl, when the winning quarterback had to pay money because of the championship bonus they were given. I think thats a special circumstance though because it was a bonus, not salary.

Pescador

pocession charge: In the end, the tax man cometh and taketh away.
Connor doesn’t seem like the type who needs eight Lambo’s and a white tiger in order to feel fulfilled.

https://m.youtube.com/watch?v=N4bMOGmZ4b8#

unca miltie

Read the L.A. Ferris book, Heathen, this week. reads like a sequel is coming..some will know who Ferris is

Material Elvis

Mr. D.:
Agents take 3%.

So that is $375K per year on average. There might be an agency fee over and above that $375K.

Material Elvis

Scungilli Slushy: In Players Tribune I believe it was Rich Clune who said that a player ends up with about half. I’m sure it’s different for lower level players than high salary guys who would have more help and ways to minimize tax.

In the end, the tax man cometh and taketh away. But you pay it earlier when you draw the money personally. Connor doesn’t seem like the type who needs eight Lambo’s and a white tiger in order to feel fulfilled. One nice item for our Captain: he gets paid in US dollars and nearly all of his expenses will be in loonies. That will take some serious sting out of his tax burden.

Material Elvis

ashley: I think they are forced to divide their yearly income into pay/game and must pay the tax rate in whichever province/state they played the game in.It’s tedious accounting, and of course those financial professional fees are going to be higher for the 12.5 million dollar guy than the the 850k guy.

Interesting. I’ve never heard that before. I know that some US states charge ‘athlete fees’ as a form of tariff on sports. I’m going to dig further into this (i.e. ask my accountant) and report back to the blog. This would open up a long line of additional questions. If Connor’s salary is mostly signing bonus, where is that taxed?

He’ll definitely pay a lot of legal and accounting fees. He’s a big business brand now.

Mr. D.

Agents take 3%.

pocession charge: His agent probably draws 500K per year on that deal.I’m sure they would advise Connor to set up a holding company to receive the revenues.Then he would draw a dividend or salary.His numbered company would pay under 15% tax on the first $500K and 30+% on the remainder.It’s a tax deferral strategy.If he takes it all personally then he gets dinged for 48% (in AB).

Scungilli Slushy

Johnny: after McSavior pays Uncle Sam and his agent, he will only take home $4-5M per year.

In Players Tribune I believe it was Rich Clune who said that a player ends up with about half. I’m sure it’s different for lower level players than high salary guys who would have more help and ways to minimize tax.

Rondo

I think Oilers should look at Jussi Jokinen he would help the Oilers and Jesse P.

ashley

pocession charge: His agent probably draws 500K per year on that deal.I’m sure they would advise Connor to set up a holding company to receive the revenues.Then he would draw a dividend or salary.His numbered company would pay under 15% tax on the first $500K and 30+% on the remainder.It’s a tax deferral strategy.If he takes it all personally then he gets dinged for 48% (in AB).

I think they are forced to divide their yearly income into pay/game and must pay the tax rate in whichever province/state they played the game in. It’s tedious accounting, and of course those financial professional fees are going to be higher for the 12.5 million dollar guy than the the 850k guy.

Scungilli Slushy

pocession charge: His agent probably draws 500K per year on that deal.I’m sure they would advise Connor to set up a holding company to receive the revenues.Then he would draw a dividend or salary.His numbered company would pay under 15% tax on the first $500K and 30+% on the remainder.It’s a tax deferral strategy.If he takes it all personally then he gets dinged for 48% (in AB).

The agent would get part of that, the agency would have a share.

Scungilli Slushy

Chachi: I have heard its 3-6%

Especially on the low end for elites.

Scungilli Slushy

ashley:
Multi-million dollar payday for the agent today too.That man will sleep well tonight.

Of course everyone else wants a piece too.So McD’s trainer is eyeing some bigger fees, his other hockey related services will cost more, and I can’t imagine what his disability insurance will cost.Then there will be all the “wealth management” companies who will be rattling his cage for some one v one time, if they haven’t already been.

12.5 million is cool and all, but it attracts a lot of unwanted attention and expense too.

I would think that instead of gouging Connor the opposite will happen. At least for anybody with business sense. Connor being a regular at your restaurant would keep the place packed. Connor at your concert, play is great publicity – free tickets.

A trainer’s career would be made even if it was just one year. Connor was already a millionaire before the contract so he was probably paying well anyway. A trainer could risk souring the relationship if he wanted more now. I am sure Connor is aware of the value of his name to anyone or anything related to hockey.

As for financial service companies, requests for donations and handouts, yuck.

Johnny

pocession charge: His agent probably draws 500K per year on that deal.I’m sure they would advise Connor to set up a holding company to receive the revenues.Then he would draw a dividend or salary.His numbered company would pay under 15% tax on the first $500K and 30+% on the remainder.It’s a tax deferral strategy.If he takes it all personally then he gets dinged for 48% (in AB).

You are probably right.

Chachi

Johnny:
I’ve always had agents in the 10-15 range of player salary. An agent wouldn’t make off very well on Pakarainens endorsement deals.

I have heard its 3-6%

Pescador

ashley:
Multi-million dollar payday for the agent today too.That man will sleep well tonight.

Of course everyone else wants a piece too.So McD’s trainer is eyeing some bigger fees, his other hockey related services will cost more, and I can’t imagine what his disability insurance will cost.Then there will be all the “wealth management” companies who will be rattling his cage for some one v one time, if they haven’t already been.

12.5 million is cool and all, but it attracts a lot of unwanted attention and expense too.

I’ll take “problems I wish I had” for $300 Alex

Pescador

godot10: Doesn’t McDavid already have a deal in place with CIBC for wealth management, that was revealed at that Skate-with-Connor-CIBC event that Lowetide was invited to?

You mean the Skate-with-Lowetide event that Connor was invited to?

Material Elvis

Johnny:
What a day for Edm.

After spending the day feeling fortunate, trying to value Leon, and trading RNH (for magic beans), I now want to point out, that after McSavior pays Uncle Sam and his agent, he will only take home $4-5M per year.

And if the oilers are able to bring in Matt Cullen on a one year deal, I think they may win the cup. I have already traded RNH, and believe me, you won’t like the return.

His agent probably draws 500K per year on that deal. I’m sure they would advise Connor to set up a holding company to receive the revenues. Then he would draw a dividend or salary. His numbered company would pay under 15% tax on the first $500K and 30+% on the remainder. It’s a tax deferral strategy. If he takes it all personally then he gets dinged for 48% (in AB).

Johnny

I’ve always had agents in the 10-15 range of player salary. An agent wouldn’t make off very well on Pakarainens endorsement deals.

godot10

pocession charge: There was no cap until 05-06, so….?

I took the cap after the lockout $39 million and multiplied it by 1.24 to account for the rollback and estimated a cap of $48.36 million for the 4 years before the lockout for Thornton’s contract. That is the only one that uses an estimate.

Material Elvis

I am not an agent, but I believe they get a much smaller percentage of the hockey contract and a larger percentage of endorsement deals and sponsorships.

Johnny

What a day for Edm.

After spending the day feeling fortunate, trying to value Leon, and trading RNH (for magic beans), I now want to point out, that after McSavior pays Uncle Sam and his agent, he will only take home $4-5M per year.

And if the oilers are able to bring in Matt Cullen on a one year deal, I think they may win the cup. I have already traded RNH, and believe me, you won’t like the return.

Material Elvis

godot10: They were normalized to the cap at the time.

There was no cap until 05-06, so….?

godot10

ashley:
Multi-million dollar payday for the agent today too.That man will sleep well tonight.

Of course everyone else wants a piece too.So McD’s trainer is eyeing some bigger fees, his other
hockey related services will cost more, and I can’t imagine what his disability insurance will cost.Then there will be all the “wealth management” companies who will be rattling his cage for some one v one time, if they haven’t already been.

12.5 million is cool and all, but it attracts a lot of unwanted attention and expense too.

Doesn’t McDavid already have a deal in place with CIBC for wealth management, that was revealed at that Skate-with-Connor-CIBC event that Lowetide was invited to?

Material Elvis

godot10: Not against Anaheim.

In four of the seven games he was on a major heater (games 1,2, and 7 weren’t great). You don’t base a long term contract off of a minuscule sample size.

godot10

pocession charge:
If you are selling your house, do you get to use comps from 2001? My gut instinct tells me no.

They were normalized to the cap at the time.

Material Elvis

ashley:
Multi-million dollar payday for the agent today too.That man will sleep well tonight.

Of course everyone else wants a piece too.So McD’s trainer is eyeing some bigger fees, his other hockey related services will cost more, and I can’t imagine what his disability insurance will cost.Then there will be all the “wealth management” companies who will be rattling his cage for some one v one time, if they haven’t already been.

12.5 million is cool and all, but it attracts a lot of unwanted attention and expense too.

I’m not a lawyer but I believe that the contract is guaranteed against injury. I believe the team takes out insurance on the contract. A personal disability policy wouldn’t work as it covers a maximum of $24,500/month, as per Canadian legislation.

You are spot on the rest of your commentary. There will always be someone trying to take advantage of him.

godot10

pocession charge:
Draisaitl put up his big numbers playing wing.(I’m not going to do the work to verify that; Woodguy must love when he gets that all the time).One continues to use top center comps, though.

Not against Anaheim.

godot10

Richard S.S.:
Apparently the Draisaitl Camp is looking for 75% of McDavid’s value.That’s what I’d call excessive.So Chiarelli knows what is possible, and I expect he waits for the “ask” to go down.Those Teams that could afford him and want him should be told – make your best offer and you might get considered.

It all depends on how long the Contract should be.I’d go two years and $12.0 Million total.Draisaitl must prove he’s a super-star to get what he wants.

You don’t get him for $8.5 million after a bridge deal though…you will be paying over $10 miliion per season and will have exacerbated the cap problem. Remember, Matthews, Eichel,Tavares, and Seguin are in the pipeline. All are likely to get $12 million. Plus Johanssen. So in two year Draisaitl will be looking for over 10.

The Oilers have the cap space this year. They can buy down the long term AAV by signing him longterm now and using this season’s cap space.

=========
So Draisaitl’s opening gambit is 75% of McDavid. I was figuring fair would be 65-70% which would correspond to historical market value of just over 11% of the cap at the time of signing.

Material Elvis

If you are selling your house, do you get to use comps from 2001? My gut instinct tells me no.

Chachi

ashley:
Multimillion dollar payday for the agent today too.That man will sleep well tonight.

Easy money.

ashley

Multi-million dollar payday for the agent today too. That man will sleep well tonight.

Of course everyone else wants a piece too. So McD’s trainer is eyeing some bigger fees, his other hockey related services will cost more, and I can’t imagine what his disability insurance will cost. Then there will be all the “wealth management” companies who will be rattling his cage for some one v one time, if they haven’t already been.

12.5 million is cool and all, but it attracts a lot of unwanted attention and expense too.

JD_Wry

pocession charge: Olympic gold medalist.

Connor simply hasn’t been old enough to be involved in the Olympics. But if they were held this summer, I would bet real sand dollars that he wins a gold.

Chachi

Diesel:
Hiked the Sulphur Skyline, hit the hot springs, then attended the game today. Impressive creativity from Moto — although that’s hardly a groundbreaking contribution. The thing that stood out to me most was Skinner’s calm movement in the net on several difficult saves. He looked very Dubnyk-like.

How was the Sulphur Skyline hike? Thinking of doing it later this year.

Material Elvis

Draisaitl put up his big numbers playing wing. (I’m not going to do the work to verify that; Woodguy must love when he gets that all the time). One continues to use top center comps, though.

JD_Wry

Gambi:

comment image

megahurts

the cap room is there there is there’s someone out there

Like poetry

Material Elvis

godot10:
Toews 5 years at 11.09% + 3 years at 15.22%, weighted is 12.63% or $9.5 million for eight years after his ELC.

Not a comparable. In the third year of his ELC, he was a Stanley Cup champ, won the Conn Smythe trophy, better scoring numbers in his first two seasons (better track record), Olympic gold medalist.

Scungilli Slushy

The way the Oilers, Connor and the agent spoke about the negotiation which considered what other top players made, what Sid did, what better teams have done, what makes sense in that light is two players, 21M.

Leon 8.5 x 8.