: News Article:
Callahan Begins Preliminary Contract Talks
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05-26-2011, 12:46 PM
Join Date: Sep 2007
Originally Posted by
He is not going to accept a back-loaded deal. You give players a front-loaded deal to help the cap. Players like them, because it gets them money up front which they can invest to earn more. Have any of you people ever heard of the Time Value of Money?
No, given his age, it will almost certainly be backloaded. Pretty much the standard is that RFA contracts are backloaded and UFA contracts are frontloaded. There are some exceptions of course (Gaborik), but for the most part, that's the way it works.
As an arbitration eligible RFA, Callahan can't command as much money as he could as a UFA, so he will get less money next year (RFA year) than he will the year after (UFA year).
Front loading or back loading doesn't affect the cap hit either way. If the overall money and length are the same, the cap hit will be the same regardless of how it's structured (unless the contract takes him past age 40, but no chance of that).
Front loading has the advantage of making the player easier to move to cash-poor teams late in the contract (Rozsival), or making it easier for him to retire with less money to walk away from (Naslund). Back loading has the advantage of making the buyout more palatable (Rostislav Olesz).
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