Calgarypuck Forums - The Unofficial Calgary Flames Fan Community - View Single Post - [Signing] Canes sign Jarvis to 8 yr ext worth $63.2 million with a rare 9th year deferred bonus

sureLoss · 09-01-2024, 10:01 AM

The key point to understand is that the player is being paid at the $7.49 AAV rate over 8 years.

The only difference is that the team and player have come to an additional agreement.

In exchange for deferring payments for parts of what the player is supposed to earn in years 1, 2, and 7 (per Puckpedia) the team has agreed to pay the player what he was owed in those years plus interest at the end of year 8. Basically the player has agreed to loan parts of what he should have been paid to him to the team and the team has agreed to pay him back principal + an interest rate set by the CBA (LIBOR+1.5) at the end of the contract.

To the player it would be no different if he took all the money and invested or loaned the money to a different entity at the same interest rate.

I assume Jarvis' agent has looked at other investment vehicles and came to the conclusion that going the deferred payment route would yield better returns and/or is less risky than what is available to them.

09-01-2024, 10:01 AM	#75
sureLoss Some kinda newsbreaker! Join Date: May 2004 Location: Learning Phaneufs skating style Exp:	The key point to understand is that the player is being paid at the $7.49 AAV rate over 8 years. The only difference is that the team and player have come to an additional agreement. In exchange for deferring payments for parts of what the player is supposed to earn in years 1, 2, and 7 (per Puckpedia) the team has agreed to pay the player what he was owed in those years plus interest at the end of year 8. Basically the player has agreed to loan parts of what he should have been paid to him to the team and the team has agreed to pay him back principal + an interest rate set by the CBA (LIBOR+1.5) at the end of the contract. To the player it would be no different if he took all the money and invested or loaned the money to a different entity at the same interest rate. I assume Jarvis' agent has looked at other investment vehicles and came to the conclusion that going the deferred payment route would yield better returns and/or is less risky than what is available to them.