Deal, Lane Hutson? Yes, he left some money on the table. Daylight robbery by Kent Hughes? No. This is a step that should not be taken and will call into question the integrity of the Montreal Canadiens general manager or the skills of the American defensemen's representatives. We'll explain it to you.
The contracts signed by Nick Suzuki, Juraj Slafkowski and Cole Caufield all had one thing in common: 16% of the value of the agreement was paid as a signing bonus. On Monday morning, Lane Hutson completely shattered that internal ceiling that had been set among the young players of the Montreal Canadiens.
Before you accuse Kent Hughes of “stealing” his young star, consider this: Hutson will receive nearly 80% of his $70.8 million in signing bonuses. Specifically, in the first two years of the deal, he will receive a staggering $11 million check every offseason around the first season.is July or 1is September. Even before training camp starts.
In short, this is a very good contract for both parties.
Time is money, the saying goes. It's not a cliché worthy of a bathroom executive: the faster Hutson gets his money, the faster he can turn a profit and see his funds grow. That's why NHL superstars are usually treated like royalty. But even Kyle Connor, who broke the bank in Winnipeg with a $96 million contract, received far less bonus money than Hutson: we're talking $41 million for Connor compared to $55 million for No. 48.
What does Noah Dobson have to do with this? In his case, we are talking about $38 million in bonuses out of a $76 million contract, or 50% of the total value. This is even lower than in the case of Hutson, who would have no arbitration rights and no right to a hostile bid under 1is July.
Are you still convinced that Hutson was deceived?
Hutson's contract structure according to PuckPedia
First year | $11 million signing bonus, $1 million base salary.
Second year | $11 million signing bonus, $1 million base salary.
Third year | $9.5 million signing bonus, $1 million base salary.
Fourth year | $6.5 million signing bonus, $1 million base salary.
Fifth grade | $6 million signing bonus, $1.2 million base salary.
Sixth grade | $6 million signing bonus, $1.2 million base salary.
Seventh grade | $5 million signing bonus, $2.2 million base salary.
The contract structure also allows Hutson to achieve significant tax savings. Thanks to the Canada-U.S. Treaty, a U.S. athlete (or entertainer) can receive a reduced tax rate of 15% on signing bonuses in Canada.
To avoid Hutson's double taxation, this 15% will be treated in the United States as a foreign tax credit, so that the principal party will end up being taxed only at the United States federal rate, which is 37%. This is a significant saving.
Hutson may have left several million dollars on the table, but the structure of the contract the Canadiens gave him allows him to put a lot of money in his pocket. That's hardly comparable to what Luke Hughes will receive, although Hughes theoretically received a better contract with an average annual salary of $9 million, higher than Hutson's $8.85 million. Hughes received a $2 million signing bonus.
Jackson LaCombe is another young guard who signed an impressive contract in the last few days. He did not receive any dollars as a signing bonus. Zero. No.
Yes, Hutson left some money on the table, and that's commendable. But as long as he invests it wisely, he will have plenty, much more in his pocket than other players signed to a similar contract.
With this signing we can name two winners: Kent Hughes, who has cut wage costs on CH's books thanks to the promise of a mountain of bonuses (thanks Geoff Molson), and Hutson, who is allowing his club to be competitive while securing its financial future.
Don't they say that the best agreements bring happiness to both parties?
