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Cashing In On Dual Offer Sheets

The words "offer sheet" combine for a horribly dirty phrase for some in the hockey world.  It's considered dirty pool by many fans and major media personalities, while general managers like Darcy Regier and Brian Burke take it as a personal affront.  Though it's not such a terrible sleight that it prevents them from later making moves that they deem right for the team, such as unloading Ales Kotalik on the evil guys that send out offer sheets.

Collectively, the authors here at The Copper & Blue are hockey's biggest (and quite possibly only) proponent of dual offer sheets.  The concept of a dual offer sheet is simple:  send offer sheets to two separate restricted free agents currently employed by the same team, especially when that team is in some amount of cap distress.  Essentially, you are forcing a team to make a choice between their assets.  I've been lauding them for a couple of years and wrote an article about them last season in which I detailed and predicted that Phil Kessel trade, thank you very much.  Because the team making the offer sheet must surrender draft picks, it doesn't make sense for a team in the lottery to make an offer, unless the player being targeted is high-end, lottery-like talent.  The strategy makes the most sense for teams in the bottom third of the draft that may have a difficult time finding talent to make an impact, or teams in the bottom two-thirds of the draft that may need an impact player but don't see that player in unrestricted free agency.

Article 10.4 of the Collective Bargaining Agreement [Warning, PDF link] covers the compensation levels and draft pick requirements for offer sheets:

Clubs must use their own draft picks (being those awarded directly to the Club by the League for use by it in the Entry Draft, including such draft picks described in the first clause of this parenthetical that a Club has traded or encumbered, and subsequently re-acquired or unencumbered.)  Clubs cannot acquire picks to use as compensation (with the exception being a Club's own draft selections that are traded and then re-acquired).

Article 10.4 also outlines that the selections must be available the following season:

  • Clubs owing one (1) draft selection must have it available in the next draft.
  • Clubs owing two (2) draft selections in different rounds must have them available in the next draft.
  • Clubs owing three (3) draft selections in different rounds must have them available in the next draft.
  • Clubs owing two (2) draft selections in the same round, must have them available in the next three (3) drafts.
  • Clubs owing three (3) draft selections in the same round must have them available in the next four (4) drafts, and so on

Below are the estimated salary ranges and corresponding compensation for 2010-2011, based on a $2,000,000 cap increase:

Salary Range Compensation
 $        1,029,448 No Compensation
 $        1,029,449  $        1,559,770  2011 3rd round pick
 $        1,559,771  $        3,119,539  2011 2nd round pick
 $        3,119,540  $        4,679,310  2011 1st round pick, 2011 3rd round pick
 $        4,679,311  $        6,239,080  2011 1st round pick, 2011 2nd round pick, 2011 3rd round pick
 $        6,239,081  $        7,798,850  2011 1st round pick, 2012 1st round pick, 2011 2nd round pick, 2011 3rd round pick
 $        7,798,851  2011, 2012, 2013, 2014 1st round picks.


Given the compensation, the only way to put together dual offer sheets without using multiple first round picks is by using the third [$1,559,771 - $3,119,539] and fourth [$3,119,540 - $4,679,310] salary ranges which require a 2nd round puck and a 1st and 3rd round pick as compensation, respectively.  By sending out a dual offer sheet in this manner, the offering team is putting each of their top three picks on the line, but at worst can only lose either the 1st and 3rd round picks or the 2nd round pick. 

I've sorted the target teams by next year's contracted cap hit, so the teams at the top of the list are in the most cap distress.

Chicago Blackhawks

Andrew Ladd ($1,600,000)
Antti Niemi ($800,000)
Niklas Hjalmarsson ($600,000)

  • The Blackhawks are in trouble next year.  They're going to need to find about $12 million in cap space and fast.  I don't know that any of these players are worth a 1st and 3rd round pick, so if I were a general manager and wanted to target these players, I would make an offer to Ladd in the [$1,559,771 - $3,119,539] range and to Hjalmarsson in the [$1,029,449 - $1,559,770] range.  A team like the San Jose Sharks could use a tough minutes guy like Ladd or a top four defenseman on the cheap like Hjalmarsson.

New York Rangers

Dan Girardi ($1,600,000)
Marc Staal ($800,000)

  • Staal has become the Rangers go-to defenseman in any and all matchups.  Even though he's young, his qualcomp is that of a veteran and he is a very steady presence for the Rangers.  Girardi was Tom Renney's pet project, but has grown into a very reliable second-pairing defenseman.  Stall immediately provides value at $3,750,000 - $4,000,000 and on a long-term deal and Girardi should be of value in the $2,750,000 - $3,000,000 range.  Both the Pittsburgh Penguins and the Los Angeles Kings seem like a natural fit for an offer like this.

Montreal Canadiens

Carey Price ($2,200,000)
Jaroslav Halak ($800,000)

  • Any general manager that is high on goaltending would be apt to make a move like this, but the man with the history of giving exorbitant contracts to goaltenders, Dale Tallon, already has an organization stocked with them.  Halak's playoff run came at a really lucky time for him as Montreal is likely going to pay him more than he's worth which could be up to $5,000,000 per season.  That leaves Price, the kid with the pedigree and the bad reputation in the lurch.  Would a team in need of a goaltender and a general manager that perhaps overvalues goalies give Price a long-term offer in the $2,500,000 - $3,000,000 range in exchange for a 2nd round pick?  Maybe that team would be the San Jose Sharks if they aren't going to chase after a big-name goalie.

Washington Capitals

Eric Fehr ($800,000)
Jeff Schultz ($700,000)
Tomas Fleischmann ($700,000)

  • Like the Blackhawks' RFAs, none of the Capitals on this list are worthy of a large contract.  But Jeff Schultz is an underrated beauty of a stay-at-home guy with size and skill.  He's easily worth $2,750,000 - $3,100,000 and a team like the Colorado Avalanche needs a defenseman just like Schultz.  They could also send an offer to Fehr for $1,500,000 to try and wedge Schultz out of Washington. 

Edmonton Oilers

Sam Gagner ($1,600,000)
Andrew Cogliano ($1,100,00)

  • The Oilers are wedged against the cap again next year and if their first overall pick makes the team, that's another $3,750,000 towards the cap.  Gagner has slowly progressed into an excellent young center, though he still struggles in the faceoff circle.  Cogliano has some of the best skating legs in the league and started his career with a scoring touch, but the Oilers haven't been able to find a place for him.  The Anaheim Ducks could use a young center behind Ryan Getzlaf who can eat up easy minutes and help on the power play.  An offer in the $4,250,000 range for Gagner and something in the $1,900,000 range for Cogliano should be enough to put the screws to the Oilers.

Dallas Stars

Nicklas Grossman ($1,000,000)
James Neal ($800,000)

  • Neal gets the headlines because he's become a legitimate power forward in a very short amount of time.  Grossman is overlooked and underrated, but like Marc Staal, he's handling tough minutes and doing it well.  The New York Rangers would be an ideal destination for either one of these guys, and both Neal and Grossman are worth something near the upper-bound of each salary range.

Nashville Predators

Denis Grebeshkov ($3,100,000)
Patric Hornqvist ($700,000)

  • Hornqvist came out of nowhere, well actually Sollentuna, Sweden, to score thirty goals last season.  Grebeshkov was the odd defenseman out in the salary cap crunch in Edmonton.  Giving a sizeable offer sheet to Hornqvist is risky, considering he has no track record, but a team like Phoenix (provided the NHL allows them to spend money) should make a pitch to Hornqvist to squeeze Nashville.  The downside of that move is that the NHL might look terrible when the league-owned team uses economic pressure to squeeze one of the teams in the league on a budget.

San Jose Sharks

Joe Pavelski ($1,600,000)
Devin Setoguchi ($1,200,000)

  • Pavelski caught hold of a lucky run in the playoffs and will turn that into millions in his next contract.  Setoguchi was demoted to the second line with Dany Heatley's arrival and his shot rates and counting stats took a major hit.  Both are all-zone players with excellent offensive game.  Both would be excellent additions to a young team with a need for a complete forward, a team like the St. Louis Blues who are losing of one of the worst contracts in the league may be an ideal fit.  They've got money to spend and draft picks.  Either Pavelski or Setoguchi are good value in the two targeted salary ranges and both of them are much better defensive players than Paul Kariya.

Colorado Avalanche

Chris Stewart ($800,000)
Kyle Quincey ($500,000)

  • Chris Stewart is big, strong, a 25 goal scorer and only 22 years old.  Quincey is a good all-around defenseman, one of only two Avs that didn't look out of place in the playoffs.  Though both deals would be enormous raises, the Detroit Red Wings could use both of these kids, especially Stewart.  Offer Quincey something in the area of $3,500,000 and Stewart $2,750,000 - $3,100,000 and hope that Colorado isn't ready to match.  Stewart skating on the wing instead of Todd Bertuzzi is a major upgrade for Detroit.

Phoenix Coyotes

Wojtek Wolski ($2,800,000)
Martin Hanzal ($1,000,000)

  • In this case, it's kind of a shame that Edmonton has the 1st overall pick [Edit:  it doesn't matter as the picks are 2011 choices, not 2010.  It doesn't matter unless you are really pessimistic, that is].  The Oilers desperately need a forward that can drive the play like Wolski and they need a center capable of playing the toughs like Hanzal.  Since the Oilers are out of the question, the Minnesota Wild are another team that could desperately use either one of these forwards, especially to take the heat off of Mikko Koivu and Martin Havlat.  Wolski is worth $4,000,000+ and Hanzal is probably a steal at $2,750,000.