Inside The Penalty Box 11.05.07: Ottawa Extends Another Star's Contract

Posted by Neil Borenstein on 11.05.2007

One month ago, it was Dany Heatley that got a contract extension. Now, Jason Spezza hit it big with a seven-year, $49 million deal starting in 2008-2009. In this week’s edition of Inside The Penalty Box, Neil Borenstein discusses these extensions and looks at the impact they will have on the Senators’ financial landscape beyond this season.

Photo Credit: Yahoo! SportsOne month after extending Dany Heatley's contract, the Senators give Jason Spezza a new $49 million, seven-year deal.

he Ottawa Senators are on a roll early in the 2007-2008 season. With 22 points, they lead the Eastern Conference standings. The Senators have an impressive 12-1-0 record; their only loss coming on Oct. 11 against the Carolina Hurricanes. Prior to Sunday's matchup against the Boston Bruins, they were second in the league in goals per game with 3.57 and third in goals against (25.)

If that weren't enough, the Senators have also managed to lock up two of their biggest offensive assets for the long haul one month into the season.

On Nov. 2, Ottawa inked center Jason Spezza to a seven-year, $49 million contract extension. The deal, which is front-loaded and includes $16 million in signing bonuses, will keep Spezza on Senators until at least the 2014-2015 season. He will make $8 million per season in the first five years of the deal, and then make $5 million and $4 million in the final two years of the deal, respectively. Ottawa will take an annual cap hit of $7 million.

Spezza's re-signing comes just short of month after the Senators signed right wing Dany Heatley to a six-year, $45 million contract extension. Heatley's contract will give the Senators an annual cap hit of $7.5 million until its conclusion in the 2013-2014 season. Like Spezza's extension, Heatley's deal is front-loaded with $9 million in signing bonuses. He will see $10 million in the first year of the deal, $8 million in each of the next three, and then $6 million and $5 million in the final two years of the contract, respectively.

Both contracts include a no-movement clause.

Combined with Daniel Alfredsson, who is signed through the 2011-2012 season, the Senators are squared away in keeping their top line intact for many years to come.

The biggest concern for the Senators this season was that two of their star players were in the final year of their deals. Heatley was scheduled to become an unrestricted free agent on July 1 and Spezza could hit the restricted market.

It's impossible to predict just how much money Heatley could have commanded on the open market, but a 50-goal scorer and consistent 100-point threat is not the easiest thing to find in the NHL. If the Senators were forced to compete with other teams for Heatley's services, it would have cost them a lot more money. I'd guess Heatley worth would be at least $8.5 million a season in unrestricted free agency.

At a time when desperate teams will not hesitate to tender an offer sheet, allowing Spezza to enter such a situation would be very dangerous for the Senators, as well. We saw Kevin Lowe of the Edmonton Oilers become very active in restricted free agency this past offseason. He forced the Buffalo Sabres to pay Thomas Vanek $50 million over seven years. And he grabbed Dustin Penner from the Anaheim Ducks with a five-year $21.25 million offer sheet – something Ducks GM Brian Burke is still not pleased with. If those two players commanded such interest, albeit from one general manager, Spezza would have undoubtedly received big-money offer sheets. That's just a sticky situation teams need to avoid at all costs in this era of the NHL.

Spezza, who is currently day-to-day with a minor groin injury, previously wanted to wait until the end of the season before signing an extension because he felt he would perform well enough this season to boost his value. But I can understand why $7 million a year would change his mind and make him decide to negotiate now.

The last game Spezza played was against the New Jersey Devils on Oct. 27, a game in which he contributed one assist in the team's 4-1 victory. And that is a bit of a concern since Spezza has yet to play a full season since entering his first season in the NHL (2002-2003.) Last season he missed time due to back and knee injuries. In 2005-2006, he missed 15 games because of hip and chest injuries. It's not as if he missed half the season or anything of that sort. But Spezza's fragility concerns me a bit, especially now that he will enter big-money territory starting next season. He can't be injury prone.

Despite that reason to worry, the 24-year old has proven to be one of the best playmakers in the NHL. It took him a few years to reach that point after being drafted by the Senators second overall in the 2001 NHL Entry Draft. But he's put up two straight impressive seasons. In 2005-2006, he had 90 points and 71 assists, with 41 of his points coming on the power play. Last season, Spezza's assist total dipped by 18, but he managed to score 34 goals and put up 87 points in 67 games played. In both seasons, he had five game-winning scores.

With Heatley and Alfredsson on his wings, Spezza will only continue to improve in setting up goals and even scoring several of his own.

Heatley set a deadline on negotiations. He either had to be signed to an extension before the start of this season or a deal would need to wait until its conclusion. The Senators were able to agree to terms with their star winger just prior to their season-opening contest against the Toronto Maple Leafs. In that game, Heatley netted a tying score late in the third period and then the game-winner about two minutes into overtime to give Ottawa its first victory in its first game of the season. Though the extension doesn't kick in until next season, it quickly worked out quite nicely.

On the season, Heatley has eight goals and seven assists for 15 points in 13 games. He also has 14 penalty minutes and is fifth on the team in plus/minus with a plus-6 rating.

Over the course of his career, Heatley was always setup to be a superstar. After being responsible in the car accident that killed Dan Snyder during his years in Atlanta, Heatley has managed to find comfort in his change of scenery that resulted from being traded by the Thrashers for Marian Hossa in 2005. In his first two seasons with the Senators, he was a back-to-back 50-goal scorer and 100-plus-point producer. I don't see any reason to believe Heatley's production is going to slip anytime soon. In fact, starting with last season, Heatley might just be a perennial Hart Trophy candidate – perhaps surpassing Alfredsson as the Senators' most important asset.

The Senators' top line is really the key to all of this. When those three players are clicking, the line is practically unstoppable. It's a major reason the Senators advanced to the Stanley Cup Finals last year, as the three leading scorers in the 2007 postseason were Ottawa's big three. They all had 22 points with Alfredsson scoring 14 goals, and Heatley and Spezza notching 15 assists each.

With this line remaining intact for at least another four years past this one, Ottawa will remain a force.

That luxury comes at a hefty price, though. The Senators now have about $42 million committed in cap space for next season. They still need to decide if they want to re-sign Wade Redden, who will provide another expensive contract – most likely at least of the $6.5 million per season variety. Andrej Meszaros will need a new deal, as he is eligible for restricted free agency this summer. Antoine Vermette and Patrick Eaves will also be eligible to hit the restricted market. Chris Kelly can become an unrestricted free agent.

Needless to say, there isn't any more wiggle room for the Senators. And that's why I have to reiterate something I've said in previous columns, and it's that Redden will probably be wearing another team's sweater come next season. With several players ready to receive raises, I don't think Ottawa has the space to bring Redden back for at least $6.5 million, maybe more. Plus, the relationship between Redden and management is strained right now and I highly doubt he's in the mindset of giving them a hometown discount just to remain with the only NHL team he's ever played for.

The Senators could try and find some financial assistance this season by letting go of some players by the trade deadline. Martin Gerber is probably on the trade block right now. But until Emery can step in between the pipes and prove he is healthy and consistent, I don't think Gerber is all that expendable. Right now, the Senators need him. If anything, the Senators can probably afford to let go of Gerber over the summer more than they can now.

Redden's departure wouldn't be too drastic, though. He is one of the better offensive defenseman in the NHL, with some keen defensive instincts, as well. But I think Ottawa is deep enough on defense that they don't really need to toss a ton of cash at Redden to keep him around. And I think Meszaros is capable of stepping into that No. 1 D spot once Redden leaves. I'm not sure he's as good as Redden, but he's close enough.

And at the end of the day, the Senators are built around three players – Alfredsson, Heatley and Spezza. As long as those three players are around, the Senators have enough pieces everywhere else to get by. The Senators are a strong team and will remain so because of their top line. And as long as Emery can get healthy and Meszaros can start maturing this season, Ottawa's tight cap situation will not hinder their dominance in the Eastern Conference.

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~ Neil Borenstein