Posting this in light of the Seth Jarvis signing having deferred payments built in.

Signing Bonus: Doan also receives a Signing Bonus in the amount of $1,376,134. On face value that appears to be an odd number for a Signing Bonus; however, what’s important to note is that this is the Net Present Value of the Signing Bonus if it were to be paid in the 2016-17 league year. However, given that the amount is to be paid as Deferred Salary, Doan (and his agent) are able to take advantage of CBA 50.2 (a) (ii) (A) “Deferred Salary”:

What this means is that because Doan’s Signing Bonus is defined as Deferred Salary, and will be paid at a later date once the contract has expired, the $1,376,134 is subject to interest, and the interest rate is calculated at the 12 month LIBOR rate (which per www.global-rates.com was roughly 1.2695% on July 11th) 1.25%, for a total of 2.5195%.

When the 2.5195% interest rate is applied to the payment schedule in Doan’s contract, the actual final monetary result is $1,500,000:

Performance Bonus: Same holds true for Doan and his Games Played Bonus which has a face value of $963,438. Again, that might seem like an odd number for a Performance Bonus, but Arizona and Bross have agreed to pay the Performance Bonus as a Deferred Bonus, with the above value again defined as the Net Present Value if the Games Played were achieved and paid within the 2016-17 league year.

When the 2.5195% interest rate is applied to the performance bonus, the actual final monetary result is $1,000,000, with a payment schedule as follows:

For a team like the Arizona Coyotes operating on budget, and who at the time of the signing were at $51M in committed salary expenses for the 2016-17 season, reducing the amount of actual dollars expended from $5,000,000 to $2,500,000, while deferring the remainder to a later date is beneficial. It gives the team more flexibility, and allows them to sign the player they couldn’t afford to lose.