Since the hot stove talk about offer sheets seems to be ramped up this year, I feel like this small, but important, tidbit is not being discussed enough. I'll use the Rangers and Peterka as an example.
The Rangers need their own 2026 2nd round pick in order to sign Peterka to any offer sheet with an AAV between $7.02M and $11.7M. They don't have that pick, so they either need to stay under that minimum or over that top end.
However, the crucial thing here is that when determining the AAV on an offer sheet for compensation purposes, the total value of the offer sheet/contract signed is divided by the number of years in the deal, or by 5, whichever is less. So on any 6 or 7 year deal, you must divide the total by 5.
So when fans say, "Sign Peterka to a 7 x $7M deal, we can give the Sabres our 2026 1st and 2026 3rd," that's not quite correct. The total of $49M in that deal would be divided by 5, not 7, which results in an AAV of $9.8M for compensation purposes, which puts the Rangers squarely back in that zone that they cannot make work without their own 2026 2nd round pick.
Just food for thought, since I see so many people talking about offer sheets, specifically with Peterka. Make sure you're doing the right math when figuring out whether or not your team has the necessary draft picks required in order to sign a player to an offer sheet.