Leo Carlsson offer sheet, explained: What Ducks matching $90 million contract means for Flyers

The NHL offseason hit overdrive when the Philadelphia Flyers signed Anaheim Ducks forward Leo Carlsson to a massive offer sheet.

The Flyers were relatively quiet in free agency, seemingly because they were preparing to make Carlsson the highest-paid player in the NHL. While the Ducks were given the right to match the contract, this deal was far more than Anaheim was expecting Carlsson to make on his next deal.

After thinking it over, the Ducks decided to match the offer sheet and bring Carlsson back to the team for the next five years. However, by doing so, Anaheim's future plans are changed for good and have to take into account Carlsson's heavy salary with their cap decisions.

Here's what this news means for both teams moving forward.

MORE: Where NHL free agents signed to begin the offseason.

Leo Carlsson offer sheet

On July 3, the Flyers officially signed restricted free agent Leo Carlsson to a huge five-year, $90 million offer sheet that will make him the highest-paid player in the league next year. Carlsson became a restricted free agent after spending the past three seasons with the Ducks, but Anaheim didn't sign him to an extension before the offseason began.

Besides the hefty annual average value, Carlsson's offer sheet is also structured in a way intended to make it hard for the Ducks to match with big signing bonuses.

Approximately $85M of the $90M is in bonuses https://t.co/08NPm9yfg5

What is an offer sheet?

An offer sheet is when a team agrees to a deal with a restricted free agent. to try and sign the player away from their current team. Because the free agent is restricted, the player's current team has seven days to either match the offer sheet as written, or let the player go to the team that originally signed the offer sheet in exchange for draft picks.

The compensation that the original team would get depends on the size of the offer sheet that was signed. It is the equivalent of trading a player for picks, with the player signing an extension as part of the return.

These are six layers of offer sheet compensation possibilities:

• $11,939,166 or more: Four first-round picks
• $9,551,332 to $11,939,166: Two first-round picks, one second-round pick and one third-round pick
• $7,163,498 to $9,551,332: A first-round pick, second-round pick and a third-round pick
• $4,775,666 to $7,163,498: A first-round pick and a third-round pick
• $2,387,832 to $4,775,666: A second-round pick
• $1,575,969 to $2,387,832: A third-round pick
• $1,575,969 or less: No compensation

A team can only sign an offer sheet if they have the picks necessary to send back in return. For example, a team that has traded any next four first-round picks cannot sign an offer sheet of $11,939,166 or more.

Leo Carlsson offer sheet draft picks

Since the Flyers signed Carlsson to an offer sheet of $18 million AAV, well over the $11,939,166, Philadelphia knew it would send the Ducks each of their next four first-round picks if Anaheim doesn't match. The Flyers can do this since they own all of their future firsts, and they even have the Maple Leafs first-round pick next year to help alleviate the potential loss of draft capital.

Ducks cap space

By matching, the Ducks now take on Carlsson's massive cap hit for the next five seasons, which will impact the way they do business. Anaheim has just over $9 million in cap space remaining and still has four restricted free agents to sign. Primarily, the team still has to sign RFA Cutter Gauthier to a new deal, and Gauthier is also due for a huge extension.

Unlike Carlsson, Gauthier is not eligible for an offer sheet, so Anaheim doesn't have to worry about another team signing him. Still, those negotiations just got much tougher.

For the Ducks to clear some cap space, they could trade some players with notable salaries. Veterans Chris Kreider and Alex Killorn are set to make $6.5 million and $6.25 million next year before hitting free agency, and both players are logical trade targets. Anaheim could also try to trade Frank Vatrano, who is making $4.6 million a year for the next two seasons.

Flyers cap space

While the Flyers are surely disappointed that they won't be adding Carlsson to their roster next year, they are still in a great spot moving forward. Philadelphia has over $29 million of cap space available, the most of any team in the NHL after free agency.

Therefore, Philadelphia should now focus on signing it's two main restricted free agents to long term deals using its ample amount of cap space. Jamie Drysdale and Trevor Zegras are both due new extensions, and it's only a matter of time before they sign long-term extensions in Philadelphia.

After those two players sign, the Flyers will be a prime team if a star player with a big salary requests a trade. Philadelphia could try to acquire someone like Dylan Larkin, but even if that trade doesn't happen this offseason, the Flyers will be lurking in the season.

Highest-paid NHL players

Carlsson is now the highest-paid player in the NHL by average annual value, overtaking Wild forward Kirill Kaprizov, whose massive extension will kick in this season. Kaprizov was set to become the first player in NHL history to earn $17 million annually on a deal. Due to Carlsson's deal only being for five years, Kaprizov's eight-year pact remains as the biggest contract in league history by total value.

After those two is a group of players bunched in between $12-14 million per season. The Oilers and Golden Knights each have two players on the top 10 list, while stars like Auston Matthews and Nathan McKinnon take up a large percentage of their team's cap.

Recent history of offer sheets

Since the beginning of restricted free agency in the mid-1980s, 45 players have signed an offer sheet with opposing teams. Since the 2004-05 NHL lockout, 14 players signed an offer sheet, with eight of the first nine teams matching.

Perhaps the most famous offer sheet signed was Shea Weber's 14-year, $110 million deal as a restricted free agent in 2012. The Predators defenseman signed the offer sheer with the Flyers, but Nashville chose to match. Weber spent the next fouru seasons with the Predators, was traded to the Canadiens in 2016 and played his last season in 2020-21 due to health issues.

Since 2019, including Carlsson, six players signed an offer sheet as a restricted free agent. Here's what happened in the other five cases:

• 2019: Hurricanes match five-year, $42.27 million offer sheet from Canadiens for Sebastian Aho.
• 2021: Canadiens don't match one-year, $6.1 million offer sheet from Hurricanes for Jesperi Kotkaniemi, get 2022 first- and third-round picks back in return.
• 2024: Oilers don't match two-year, $9.16 million offer sheet from Blues for Philip Broberg, get back 2025 second-round pick in return.
• 2024: Oilers don't match two-year, $4.58 million offer sheet from Blues for Dylan Holloway, get back 2025 third-round pick in return.
• 2026: Mammoth match one-year, $4.775 million offer sheet from Devils for Barrett Hayton.