The Vegas Golden Knights management team has made it clear that they don’t believe last season was a fluke and they’re committed to preserving most of their core long-term.

The Golden Knights have extended a number of players to long-term deals in the last few months. Some of the decisions were no-brainers, like locking up 75-point winger Jonathan Marchessault ($5 million average annual value through 2023-24) to a six-year deal.

Others have created a little bit more of a debate. They bought big on goalie Marc-Andre Fleury and right wing Alex Tuch this summer, both off of big years in 2018-19. Fleury’s $7 million AAV contract through 2021-22 puts him in the highest echelon of goaltender salaries, a more questionable move for a player coming off of a career year at 33 years of age. Tuch’s seven-year extension at a $4.7 million cap hit is another somewhat risky bet – he showed plenty of upside in his first year with Vegas (37 points in 78 games), but that’s still a decent amount of money to buy off three UFA years.

The Knights announced another big-time extension on Thursday night – this one for blueliner Nate Schmidt, who was set to expire at the end of the 2018-19 season. Schmidt earned a big-time raise – an AAV of $5.9 million through the 2024-25 season.

It’s another interesting bet for the Knights. Schmidt was a monster last season – arguably the best defenceman on a Stanley Cup-calibre team, which is a significant accomplishment. But he’s also the same player who was struggling to stay in the lineup in Washington in years past. It’s clear at this point that the Capitals never properly valued how talented Schmidt was, but the contract extension raises another question: Should Vegas ignore the results from Schmidt’s Capitals years and only focus on the one (great) season with the Knights?

That question is at the centre of the debate over whether Schmidt was overpaid, underpaid, or properly paid. One of the first ways we attempt to answer that question is to look at contract comparables. The incredible resource at CapFriendly finds matches through a series of similar variables, including average annual value, contract length, signing dates and ages, scoring similarities and percentage of cap hit allocated.

It’s the last one I’m most interested in. Schmidt’s contract seems big at first glance, but is it really? CapFriendly noted the most direct comparables as Jeff Petry, Andrew MacDonald, Marc Staal, Jonathan Ericsson, and Andrej Sekera. That’s pretty scary at first pass if you are Vegas GM George McPhee – outside of Petry, those guys have either sorely underperformed or have been battling injuries.

But while the percentages of cap hit are similar, they are not exact. Schmidt will be less of a liability on the books than any of these names sans Ericsson, assuming a standard 3 to 4 per cent growth on the cap for the next few seasons:

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Although Schmidt is carrying the highest average annual salary at $5.9 million, he’s actually the second-lowest paid player within this group. Staal, Petry, and Sekera are all being paid less, but also signed their contracts a few seasons ago when the league’s salary cap was much lower. That means that their contracts, proportionally speaking, ate more into the team’s salary cap.

The spread between those contracts and Schmidt’s contract, again assuming about 3 to 4 per cent growth, is about one percentage point. What is one percentage point worth? A fair amount of money. Over the life of those contracts, it could be anywhere from $4 million to $5 million in cap space. That’s significant, especially for a contending team.

So the good news for the Golden Knights is that Schmidt's deal will eat less into the salary cap than some of those names. But that doesn't help us answer a second question: Why did Vegas feel as though they needed to offer up this type of contract now?

The franchise was obviously worried about sending Schmidt to unrestricted free agency. That’s an area where players are notoriously paid well, especially top-four defenders. And one of the items I was curious about was what type of premium unrestricted free agency captures.

Behaviourally, we know there are two components that act as drivers for defencemen when UFA contracts are negotiated. Average ice time (or usage) and point accumulation remain reasonably strong predictors of future contracts. To that end, I was curious to see where Schmidt would have stacked up against some other notable UFA contracts signed by defenders in recent years. Here’s what that looks like (with size of the bubble indicating how much of the team’s salary cap would be allocated to that player over the term of the contract):

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 This, I think, lends some credence to what McPhee is doing. Schmidt was heavily utilized last year – in fact, he played two minutes more than the next highest utilized player in Vegas last season (Shea Theodore). Amongst this UFA group, he was the most deployed defender in the season predating his new contract. He was also reasonably productive in the offensive zone, trailing only Mike Green on the scoring front.

Yet despite being used as a top-pair defender and scoring at a reasonable rate, he was allocated about 6.5 per cent of the cap going forward – less than the likes of Paul Martin, Andrej Sekera, Kevin Shattenkirk, and Mike Green. I think this more than anything emphasizes the premium that top-four defenders carry on the market, and what it takes to retain or sign that type of talent.

Does this make Schmidt’s contract a great one? No. I think there’s plenty of reasonable debate to be had about whether or not teams are better off avoiding UFA contracts altogether for non-superstar talent. And I think it’s still worth wondering whether or not you should react to one very productive season, essentially throwing out 200 games of data with Washington.

But I do think the contract is a defendable one. This appears to be, generally speaking, the cost of business when dealing with pending UFA defencemen who log heavy, fruitful minutes. And Schmidt’s contract appears to be less risky than the majority of others signed over the last few years.

I’d say both sides won on this deal.