San Jose signs Niklas Hjalmarsson to four year, $14.0MM offer sheet

In a story line that cries cutthroat revenge, Doug Wilson has signed burgeoning defensive stalwart Niklas Hjalmarsson to a 4 year, $14MM offer sheet.

The 23 year old Stanley Cup Winner would count for $3.5MM against the cap. Chicago has seven days to match the exact offer given to Hjalmarsson-- if they choose to let him walk, San Jose would give up a first and third round selection in the 2011 NHL Entry Draft.

It's been well documented that Chicago has dealt with major salary cap issues since winning the 2010 Stanley Cup, and they've had to move out a significant portion of their Stanley Cup winning roster-- Brent Sopel, Dustin Byfuglin, Kris Versteeg and Andrew Ladd have all found new homes as of today. However, with a significant amount of money still assigned to Jonathan Toews, Patrick Kane, Patrick Sharp, Brent Seabrook, Cristobal Huet, Brian Campbell, and Duncan Keith, these issues have not subsided. Add into that the approximately $4MM that will count against the cap due to performance bonuses, as well as the upcoming negotiations with goaltender Antti Niemi, Chicago still has a long way to go before they become solvent.

Currently, Chicago has nine forwards, four defensemen, and one goalie under contract. With three forwards, two defensemen and Antti Niemi left to sign, they have approximately $3.6MM in cap space (according to Cap Geek).

Here's where things get interesting. Assuming they move Cristobal Huet to the minors, they free up another $5.625MM, leaving them with $9.225MM to work with. If Niemi signs for somewhere in the $2.5MM range they now have about $6.7MM to fill out their roster. Adding Hjalmarsson into the mix, that leaves them $3.2MM for three forwards, a defenseman, and a backup goaltender.

Each of these players would be required to sign at an average of $640,000 per year, which is doable considering the league minimum salary of $500,000. Furthermore, letting Niemi walk is also a possibility, and is currently being discussed as the most desirable solution at Chicago Blackhawks blog Second City Hockey.

"In all honesty, I really don't think that's going to make the Hawks blink. Frankly, I'll be shocked if Hammer isn't matched," author Sam Fels writes. "That would probably grease Niemi's wheels out of town, but I know which one I'd rather have."

Chicago, along with every other NHL organization, also has a 10% cap cushion to play with in the coming months until they are required to become cap compliant before the regular season begins.

However, the four year term allocated to Hjalmarsson does pose some problems for Chicago. As Fear The Fin commenter Vancitydan pointed out, defenseman Brent Seabrook is up for contract next offseason and will command a significant raise above his current salary of $3.5MM per year.

We covered the prospect of offer sheeting Hjalmarsson three weeks ago, and here is a the rationale for doing so:

While the Sharks aren't mentioned in this article, the addition of Niklas Hjalmarsson to the San Jose blueline would be a great addition to the team. We highlighted his underrated abilities before the Western Conference Finals, and true to form, the man they call The Hammer was a notable presence on the ice for the Blackhawks.

Extending an offer sheet to Hjalmarsson is an interesting situation. Anything under $3.01MM would only result in the Sharks losing next year's 2nd round pick, and anything from $3.01MM to about $4.5MM would result in losing next year's 1st and 3rd round selections. The former is definitely the most intriguing for a Sharks team whose cupboard is growing bare after years of buy deals, and the ability to bring in a promising young defenseman onto the blueline makes the waning strength of the system less of a factor.

Another route the Sharks could go would be to trade their first round selection to the Blackhawks for Hjalmarsson's rights. While this may strike some as ludicrous considering it would be the third straight year the Sharks have failed to draft in the first round, giving up a first round selection for a promising defenseman would likely be worth the same return (if not better) than what you would expect from the 28th pick in the NHL Draft.

A recent contract signed by Dennis Seidenberg ($3.25MM average over the next four years) shows us that a premium has been placed on free agent defensemen this offseason, likely bumping projected prices up at least half a million dollars. With the Sharks having some pretty significant holes to fill, it's uncertain how aggressively Doug Wilson will approach an area he hasn't had a lot of success in over the years. Signing one UFA defenseman is likely where San Jose draws the line, since it's the second tier guys who will really burn you in a weak market.

At a $3MM offer sheet Hjalmarsson is a steal, and the 2nd round pick is but a cursory concern when you consider how young (22) and talented he is. Extending offer sheets is risky business considering the notable RFA's San Jose will be dealing with in the coming years (Pavelski, Setoguchi, Demers, Couture, McGinn), but for a team that needs defensive help any way they can find it, burning a bridge with an unlikely trade partner (Chicago) is a calculated risk that could pay off big dividends.

We like the idea, especially when you consider what a second rounder is worth in the eyes of Doug Wilson.

>> "Rumor Roundup: Souray, Kaberle, and Whimsical Wants"

Although that piece focused on second round compensation, we both feel that a first and third rounder is a suitable price for a player who is 23 years old and on the upswing of his career. Hjalmarsson gives the Sharks that top three defensive defenseman we have been craving for a long time now, and opens up the possibility for San Jose to pursue a more offensive minded defenseman to complement the power play.

A week from now the decision will be official, with Hjalmarsson wearing either a San Jose or Chicago jersey. Until then, we expect Wilson will be quiet on the trade front as making another move at this juncture could expose some glaring holes in his roster.

A contract for Devin Setoguchi, however, isn't out of the question, and would give Wilson a better idea of where he stands in terms of cap space.

Go Sharks.

The initial fanshot breaking this story can be found here.