How Giordano’s Extension Creates Possibilities

When I saw the press release in my e-mail inbox yesterday morning, I’ll admit I was worried. The Calgary Flames had re-signed Mark Giordano. This was going to be expensive. He’s Calgary’s best player by a fair margin right now. Best players typically do cost a lot of money.

I expected a deal to cost the Flames between $8 million and $9 million annually, enough to force some belt-tightening this coming summer.

So when I saw that the Flames had somehow gotten the deal done for $6.75 million per season, I was equal parts shocked, impressed and excited. This is the kind of deal that opens up a lot of possibilities for the team going forward – at least for the next few seasons.

THE SUMMER OF 2016

Next summer, the Calgary Flames will be looking at the following in terms of cap commitments – presuming nobody gets moved out:

  • Mark Giordano – $6.750m
  • Dougie Hamilton – $5.750m
  • Dennis Wideman – $5.250m
  • T.J. Brodie – $4.650m
  • Michael Frolik – $4.300m
  • Mikael Backlund – $3.575m
  • Ladislav Smid – $3.500m
  • Mason Raymond – $3.150m
  • Matt Stajan – $3.125m
  • Deryk Engelland – $2.917m
  • Lance Bouma – $2.200m
  • Brandon Bollig – $1.250m
  • Sam Bennett – $0.925m

Via NHLNumbers.com

When you do the math, the team’s committed roughly $47.342 million for 2016-17 already. If we presume that the NHLPA uses their 5% cap accelerator like they did this summer – and like they always seemingly do – you’re looking at a cap of around $74.97 million for 2016-17. So with Giordano’s deal done, the Flames have seven forwards and six defenders inked and about $27.63 million in cap space available to sign 10 players, including two goaltenders.

That’s not bad.

And if you presume that Giordano’s $6.75 million cap hit puts a ceiling on future contracts, we can peg the new deals for pending restricted free agents Sean Monahan and Johnny Gaudreau at around $6 million each. That leaves more than $15 million in cap space to sign a pair of goalies and some depth players.

And that means that with a free agent list that will include restricted players like Joe Colborne, Josh Jooris and Joni Ortio, and unrestricted names David Jones, Jiri Hudler, Kris Russell, Karri Ramo and Jonas Hiller, suddenly – unexpectedly – it appears that the Flames will actually have the financial ability to retain a few key names rather than tighten their belts.

That also means that the team has flexibility. Let’s say Tyler Wotherspoon is ready for the NHL full-time; Treliving can try to move an existing defensive contract, or he can simply let Kris Russell walk to move a younger body in. The same could happen in the forward ranks; Jiri Hudler can easily be retained at a $5 million (or thereabouts) cap hit. Heck, David Jones could take a pay cut and stick around, or they could move somebody in from Stockton.

Regardless of how things unfold, we may end up seeing some auditioning take place this season, as the players that aren’t obviously part of the team’s core will be vying for a roster spot and some of the cap space that the Flames will now have this coming summer.

And it gets better…

THE SUMMER OF 2017

Coming off the books on July 1, 2017 (if not before) are arguably the team’s worst contracts:

  • Dennis Wideman – $5.25 million
  • Ladislav Smid – $3.5 million
  • Mason Raymond – $3.15 million
  • Deryk Engelland – $2.917 million

Brandon Bollig’s $1.25 million is also coming off the books, but that’s a deal that’s not too hard to work around in the current system.

But there is just shy of $15 million coming off the books potentially for 2017-18, at a time where the team’s best players will have been locked up already and the only major player to re-up will be Sam Bennett. Add in the presumed $4 million bump in the salary cap (via the 5% NHLPA cap escalator) and Brad Treliving has his core locked up long-term and a lot of financial flexibility to maneuver in the event he wants to get creative with the supporting cast.

  • ChinookArchYYC

    I was so happy with the deal yesterday, never considered how Giordano’s contract would probably govern the rest of his teammates future contracts.

    Gaudreau and Monahan’s agents aren’t likely too happy this morning.

      • Howedy

        The ceiling for what their clients will make on their next contract has been set lower than expected. Gio is the best player on the Flames and will make the most money, the potential for Johnny and Mony to earn 7 million plus a year has been taken away, in theory.

        • Parallex

          That’s silly. I don’t believe for one second that the captains salary will actually enforce some ceiling on what others can make.

          I mean does anyone actually think that if either sign an offer sheet for $6,750,001.00 that Treliving will let them walk if he would have matched at $6,749,999.00? Not that it matters since I don’t think that it will take more the 6.75

          • piscera.infada

            Agreed. That contract, coupled with Hamilton and Brodie, does further create a salary structure.

            But I mean, let’s assume Monahan goes out next year and progresses by leaps and bounds again and proves he’s an elite number one centre in the west. What’s that worth to Treliving? This contract doesn’t magically make him a sub-$6.75m player, but it probably means his contract will be closer to that, than $9 million.

          • Parallex

            Well… yeah. But it won’t be closer to that then because that’s what Giordano makes, it’ll be closer to that because that’s what very high level young players get (or there abouts) on their second contracts.

          • piscera.infada

            Of course the Offer Sheet scenario is true. However, hopefully BT will get them both signed in the New Year well before another team can try to poach one of them with an Offer Sheet. And in any case, since I’m pretty sure both are seen as Core Players for the now and future, the Flames would match any Offer Sheet.

            Beyond that, though, the Flames are a good organization, and both Monahan and Gaudreau the type of players that will have loyalty unless something drastically bad happens which I doubt will occur. Not too worried about Offer Sheets for those two.

            I would like to see them re-signed asap as that would provide certainty that could then translate into better decisions on some other guys like Hudler…

          • The Fall

            it gives BT huge leverage in negotiations though. And it’s not just the Gio contract. This started with Brodie and continued to Backs, Hamilton, and Frolik.

          • Parallex

            How?

            What leverage does it provide? It doesn’t provide any incentive for either players or their agents to sign for less then they would otherwise, it doesn’t change their service time (and by extension their arbitration or free agency period), it doesn’t limit their ability to receive offer sheets… in short it changes nothing. No one has any more or less leverage.

            If players/agents are going to play hardball then they’re going to play hardball and if they’re not then they’re not. How much Giordano makes isn’t going to change that.

          • The Fall

            Yeah if Johnny gets an offer sheet at $10M then BT will have to make a decision. But the culture at the moment seems to be negotiate the extension before that happens. BT also showed that he can get the extension done at a rate and term that works for the team and player (like Brodie). He’s also shown that he won’t overpay for a blue-chip player (like Hamilton or Frolik), while still convincing them to take less then they could elsewhere. Also, the only real player with potential to be worth more than Gio is probably Bennett and he’s years away.

            We have no idea what goes on in his office. But obviously BT is pretty shrewd and fair. Any leverage like saying I won’t give you more than the team’s first all-star is a start.

          • Parallex

            That’s not leverage.

            Lack of arbitration rights is leverage, market suppression due to RFA compensation is leverage. Saying that you don’t want to pay a guy X because another guy makes Y? Not leverage.

            I fully expect our guys to come in at less then that number… but I expect them to come in at less then that number because they have less actual leverage due to their lack of service time and because it’s rare for guys to make more then that on their second contract.

          • The Fall

            I appreciate the discussion but in this case BT’s leverage refers to the principle of using a small advantage (even a perceived advantage) to gain a larger benefit…

            If Sean’s agent says he wants $8M — BT can say the best player makes less than $7; so if he wants to remain a Flame and win a cup and date chicks from the Stampede… he has to settle for $5.5…

            That seems like an advantage.

          • Parallex

            … how does it seem like an advantage?

            Sean’s agent can just say that “Tarasenko makes 7.5 and signed his deal in a lower cap environment, and Sean can date super-models if he wants to, so gimme 8”.

            How is that any less of an advantage? They’re just words man.

            Do you really think anyone is going to take a $20,000,000.00 haircut (difference between 5.5 and 8 multiplied by 8 year term) just because Mark Giordano makes X?

          • Robear

            Im not sure that we are comparing apples to apples in this argument. I havent heard, but my expectation is that Gio’s contract is front end loaded with an actual salary closer to $9MM per at the start of the contract and then decreasing across the contract so that the AAV or cap hit is $6.75MM.

            The reason for that is, as everyone expects, he’s a declining asset given his age (as an aside, Im VERY interested to see how Gio progresses these next few years. I expect the drop off wont be as severe as history might suggest). Our RFA s of course are, based on their young ages, improving assets. I would expect that their “actual” salaries would start lower and end higher during this next contract

            ANy leverage BT has from Gio’s contract is likely keyed more on actual salary rather than the AAV.

            That allows for the kids to progress in salary so that the torch can be passed (likely during this contract) at a time when Gio is no longer the Flames best player.

          • Greg

            I doubt it’s front loaded, you don’t want 38 year Gio deciding to retire and the flames getting hit with a huge cap recapture in the final year.

            Front loaded contracts are so 2012… Paying 90% in salary bonuses to make a contract buyout proof is all the rage now!

          • supra steve

            Gio, Brodie, Hamilton are leading by example. They could have all held out for more $$, leaving less to be split among their teammates (Stajan, etc.). They all chose to sign “reasonable” deals and one could hope that others (Gaudreau, Monahan, etc.) will follow that lead. There are no guarantees, but I like the way the club has positioned themselves for those key extensions. And I like the leadership’s leadership on this matter.

      • ChinookArchYYC

        Using the Lindstrom Red Wings era as an example. It was touted, at the time that any player who wanted to play for the Wings would have to accept a deal for less than Lidstrom’s. If a player or agent asked for more dollars/term, then it was presumably tantemount to asking for a trade.

        It’s certainly no guarantee, but rationally speaking asking for more money than the best player and captain of a team will only get an agent/player so far. We also need to look at what Brody and Hamilton signed for to help the Flames cause, where future negotiations may go.

  • KACaribou

    The most interesting thing to me coming up will be who gets packed among our copious forwards, and one too many goalies.

    Not to feel too sorry for a guy making almost $7 million a year – more than most people will make in a lifetime – but Gio took one for the team when he could have received more.

    It does bring on more possibilities for winning, and indeed a ceiling has been set. Anyone wanting more isn’t the type of team guy we need or want.

  • ChinookArchYYC

    I would add Stajan’s contract into the mix as not great. Comparatively speaking he’s more valuable and closer to actual value, but still too high and long.

    Btw I like Stajan. He can very capably play anywhere up and down the line and fit in nicely. Under rated Flames forward.

  • prendrefeu

    The cap management will definitely be tight going into 2016-17 but if they don’t do anything stupid, they will be in fine shape as Mony/Gaudreau/Bennett/Dougie/Brodie start approaching their prime years. That’s a pretty solid core to build around.

  • The Fall

    He’s building a superstar core of players all between $4M-$6.75M. The model of one or two elite $10M guys won’t work with the current coach and system. As he said, BT believes in a strong top 9 forward group – not a top 3 or even 6.

    Also, this is the most optimistic post I’ve read on this site. Exciting times. Good one.

  • RedMan

    Like someone else mentioned in the other article, good for Brad Treliving, but we need to give Giordano a lot of recognition and credit for this…

    He really demonstrated a very team-minded attitude, which should not surprise us as he has been like this all along.

    Gio has been a class act – a living, breathing example of “everything earned, nothing given”, who puts it all out there every night as an example to the team, and I doubt there would be much patience for anyone who didn’t do the same.

    Yes, Gio has emerged as elite defensively, but the “intangible’s” here are actually very tangible.

    Calgary is truly fortunate to have Gio as their leader.

  • RedMan

    With Gio taking well over a million dollar team discount it allows the team to pursue either their own UFA’s Russell or Hudler with far few restraints. However the Flames could have players develop this year that could replace these guys; one never knows. It is likely that the other UFA’s will be replaced internally as I see Poirier being able to replace Jones and Arnold may be able to replace Colborne or Byron by the end of the season. If these things happen then they might be able to pursue some other missing pieces, again having a solid core signed with some very good prospects(good deals) and some cap space bodes well for the Flames. Like most here I can’t wait for rookie camp and the season to start.

  • Cfan in Vic

    Nice to see the tone of this article in contrast to the original one yesterday. I think the opportunities that this contract opens up over the next 4 years far outweigh the constraints that it implies over the last few declining years.

    The long term future is important, of course. But the window for this team seems to be open over the next 5yrs, so just giv’er.

  • Matty Franchise Jr

    Where the heck did that abomination of a jersey come from? Holey crap, that’s horrible.

    This is fantastic contract for the Flames. I’d have been happy with more money and more term, but BT crushed it again.

    BT confuses me. How can he do so well with actual top players and their contracts, and yet sign some terrible bottom end contracts? Engelland, Bollig, and to a lesser degree, Bouma.

    • piscera.infada

      Uniform: All Star team 2015

      BT: Bollig is OK contract-wise, and we didn’t sign it anyways. Engelland was the going rate to get a tough, mid-level defender as a UFA, helping us reach the Cap Floor. Yes it looks steep now, but in his defence he filled in admirably late last year and its not like any of our prospects have yet stormed the gates and demanded a job. BT had to sign two additional D last year just to fill a roster. He gets a pass from me keeping everything in consideration, as well as looking at his overall record.

  • RealMcHockeyReturns

    Interesting, I thought hard on this also yesterday and did a bunch of math. Here are some guesses at what Flames do – and where I feel they will end up for next season:

    All numbers are the cap numbers below (Average Annual Value of contract):

    GONE OR TRADED (all positions) with no bodies coming back: D Jones, Colborne, Byron, Shore (I like them but sorry you got to cut somewhere)

    THAT MEANS (whether we like it or not): Stajan, Raymond, Bollig, a healthy & improved Smid, an improved Engelland all stay as well as all others signed for next season. So what else…see below.

    Forwards: Re-sign Hudler at $5M (1-2 year), Re-sign both Monahan and Gaudreau at $6M (4 years each), Re-sign a surprising Granlund at $1M, Re-sign Ferland at $975M

    Defense: Re-sign Russell at $3M after another strong season

    Goalies: Re-sign Ramo at $3.8M for 2 years and Ortio for $1M (for 2 years)

    Total cap hit: $77,493,566 so NEED TO CHANGE THE ABOVE…TOUGH if you want to keep the entire first line.

    • SmellOfVictory

      Those Monahan and Gaudreau contracts are literally the worst contract structure that could be chosen. That would take Monahan directly to being an unrestricted free agent and be more expensive than a bridge deal. I don’t think there’s any way Treliving would even consider it.

  • Brian Burkes Tie

    Can gaudreau even be offer sheeted next year ? I may be wrong but I thought Kent or another writer brought up that for some strange reason he can’t .. Maybe wrong but that’s what I thought!

    • Tomas Oppolzer

      You’re correct. It’s a loophole that has to do with how many games he played in the first year of his contract (only 1). In other words, Gaudreau doesn’t even have that leverage.

      • Greg

        Haha, that’d be a funny conversation in the negotiations… “Hey Johnny, remember that time we enticed you to forego free agency and leave college early by allowing you to burn the first year of your ELC by playing only 1 game? Ya, well that also cost you offer-sheet leverage, so just let us know when you are ready to accept half what you’re worth otherwise”.

        Followed of course by the conversation when he hits UFA… “Remember when you low balled me on my 2nd contract…”

    • Train#97

      Loaded with small forwards unless that changes it will be no different than last year. McDavid thankfully 6’1 195 Draisaitl 6’2 215 Nurse 6’5″ 218. Calgary forwards…. Nah you get the point

      • Cfan in Vic

        You two are free to email back and forth about how much you think the Flames suck, or talk about it on ON.

        Since you’re not changing any opinions over here, a nice email chat would probably accomplish just as much.

      • Reidja

        What are the chances the Oilers have the ‘nads to put McDavid out against Kanzig and Smith in Penticton? Exactly.

        I love the offseason. Oiler fans are so depresing the rest of the year.

        • Train#97

          Probably a whole bunch this season! Mcd leadin the way!! Hope the Flames are ready for this guys wheels. Do yourself a favor watch some of his highlights he is “Electrifying ” oh Yeah!!

          • Brent G.

            You’re such a f*cking homer. Surely no one could be so naive to honestly believe some 18 year old player could influence things that much to tip the scales in their rookie season.

            Don’t forget the rest of the roster is littered with over rated pussies (ie RNH, Eberle, Yakupov) coupled with unproven/embarrassing goaltending and top 5 NHL-worst defensive line ups.

          • Train#97

            Well time to put another one to rest ” That’s a wrap folks “. Have a great day, can’t wait to get the season underway. Btw I respect all your comments here except for anything from WW. I know you feel the same way.

        • Brent G.

          How many cups do the Flames have? See, I can reference things that no longer matter. Right now series is tied for 2015 – 2016. All that matters is the games ahead.

          And despite how much I think the Flames are way overrated and will come crashing back down to earth. I am happy the battle of Alberta might actually be a real battle again.

  • ChinookArchYYC

    PLEASE STOP FEEDING THE TROLLS.

    Don’t even trash them, it obviously promotes them to continue beings pests. Just remember it’s better to be despised and hated than completely forgotten. Ignore them and they’ll go away.

  • redhot1

    Awesome to have a dman of Gio’s quality patrolling the blue line for years to come. Does everything well for the Flames.

    Best offensive d man.
    One of the best offensive players on the team period.
    Best shutdown d man.
    One of the best shots on the team.
    Best physical d man.
    Puts up incredible possession stats.

    By all account, a terrific leader, along with one of the fittest player on the club. All of this from an undrafted player. Great contract from the GM, and great job to Gio for being a player easy to negotiate with.

  • The Fall

    Wow, didn’t realize how much money was coming off the cap in 2 years (Wides, Engelland, Smid, Raymond). Treliving has really set this team up well financially. Colour me impressed.

  • MillHoodsHockey4Life

    Won’t even have that much cap space next year as Bennett’s bonus affects his cap number. Could pose some issues if he, Monahan and Gaudreau have strong years making the next contracts that more expensive. Realistically they’ll all be looking at deals around (+/-) the Oiler deals for Hall/Nuge/Ebs.

  • Greg

    Gotta admit, I’m not as optimistic as this article about the cap situation in 2016. This will be first full season with a depreciated Canadian dollar, and given Canadian teams are over 1/3 of the leagues revenues, a ~15% drop in Canadian revenue value will more than wipe out any other gains and we could even see a cap drop.

    That puts the cap space closer to $24M, and $3.5M less is going to seem like a huge amount next offseason. Say you resign Gaudreau and Monahan for $12M total and fill out your net for $5M. That’s leaves $7M for everything else. You can’t retain either Hudler or Russel and still fill out the rest of the roster.

    Only hope to not take a hit next year is to move at least 2 of those well-known poor value contracts. Sounds like Smid will be playing this year, so there goes that get out of jail free card. Maybe stajan will draw interest at the deadline, but I don’t like the odds of us being able to jettison any of the others, especially if all the teams are struggling to deal with a declining or flat cap.

    The year after though, everything is very very rosy!

    • Train#97

      I agree with that assessment and while I like Russell I dont think it makes sense to resign him with our current depth of prospects. He is in line for a raise and is entering his 30s.

      I would like us to package him with some prospects/picks for an elite winger.

      Like everything that Russell brings but I really question whether giving him a raise is the right way to use our cap space.

      Like a Hossa. . Hudler is the type of complimentary player that you need. He should be the priority.

      I know… i want to keep everyone too but in this case it might make sense to trade Russell while he has some value on a cap friendly deal.