What's the holdup on Price's contract?
What's the holdup on Price's contract?(2010-07-22 18:51 posted by B. La Rose)

Why hasn't he signed yet?  What is he waiting for?  Is he holding out for a trade, does he even want to be a Hab?  Such is the discussion surrounding the once again #1 goalie Carey Price, currently an RFA.  Many are assuming Price is the reason for the holdup, but is that actually the case?

The truth is, both sides are responsible here.  It was reported earlier in the week that Price's camp wants a 3 year contract, worth around $3 million per season.  This isn't all that different from the 3 year pact Cam Ward signed for $8 million total ($2.67 M cap hit) back in 2007 when you factor in salary escalation since then.  Both goalies were coming off their entry level deals, both had success in the World Juniors, and both were 1st round picks.  (Ward also had a Conn Smythe Trophy while Price's playoff MVP award came from the AHL.) 

The Habs, however, appear to be focused on a 2 year deal for a couple of reasons.  First off, he's coming off of what most would agree was a disappointing season where he lost the starter's role.  If he can't return to his rookie form, the longer the contract he has, the worse off it will be for the club.  Of course, there's that type of risk with virtually every player coming off an entry level contract, which is why this isn't the more prominent reason.

You may have noted that there was no salary figure listed with the 2 year contract, that's simply because one wasn't noted at the time this report came out.  However, watch for a deal of this length to be around $4-5 M over the 2 seasons.  The reason is twofold: 1) Price is still highly touted, the goalie of the future, the potential face of the franchise, yadda, yadda, yadda.  He knows it, the organization knows it, and so too does the agent - you still have to pay for potential and perception.  2) The second year of the deal would be buying out one of Price's arbitration years, that in itself can be costly.  Take Benoit Pouliot's 1 year, $1.35 M deal for example.  Despite struggling down the stretch, the organization was concerned he could command upwards of $2 M in arbitration.  (That's why his qualifying offer wasn't issued, to avoid this from potentially happening.) 

Taking out one of Price's years will add several hundred thousand dollars, but two years?  That'll cost even more, which is why the goalie's camp is looking for near $3 million per.  There's a notable gap between the annual cap hit from a 2 to 3 year deal, which is the other reason the Habs aren't banging down the door to get this done as quickly as some would hope.

From HW's salary cap update, the Habs have roughly $3.6 million to spend ($4.4 million if you don't leave any space for injuries/future trades).  Sign Price to the 3 year deal and you can kiss away any hopes of making any sort of notable trade/signing.  Sign him to the 2 year contract and all of a sudden there's some wiggle room heading into camp.  However, since the never ending Kovalchuk saga seems to be holding up much of the offseason wheelings and dealings, some of these "opportunities" have yet to present themselves.  By signing Price now, GM Pierre Gauthier locks himself in - either the Habs are done for the offseason or they're committed to changing the roster up some more. 

At this juncture, it's too early to tell what options may be out there, so why commit now?  By keeping Price unsigned, there's still some flexibility and for a team with not a lot of cap space, any flexibility (which could lead to leverage) is a good thing.  Granted, there's always the risk of an offer sheet but Price would have to sign it (it's not an automatic like some seem to think).  The Habs have spoken to Price's camp about this and are reasonably assured that he won't be signing one of these.  Of course his agent won't say 100% he won't sign one; otherwise, their side loses leverage.  But rest assured, if Montreal felt Price would sign an offer sheet, they'd have locked him up by now and let the pieces fall as they may later.

As for my predictions on what might happen?  It's too tough to predict when a deal would be signed, it could be tomorrow, next week, next month, or in the middle of training camp.  A deal will only be struck when the Habs are 100% sure which direction they're going (and that may take a while based on how slow the market is).  Will it be the roster that we see today with no real changes?  If so, the 3 year contract will probably be signed.  If they acquire another player via trade/free agency?  Now their cap space is diminished and only the 2 year deal is palatable.  My personal opinion is that the numbers (or at least the framework) are basically agreed upon for both the 2 and 3 year deals.  Watch for the contract (either length) to be backloaded as well to ensure Price gets a higher qualifying offer at the end - the good news is doing so generally lowers the cap hit a little. 

It's not a matter of one side holding out, it's moreso that the Habs are keeping their options open that's delaying Price signing.  Here's hoping the wait proves to be well worth it in the end.

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- What's the holdup on Price's contract? posted by B. La Rose
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