How did KK took a discounted contract?
By giving up potential money for security. This isn't a first round pick that was placed on waivers & picked up by another team. Another team gave up real assets to obtain him.
He was coming off a 29 points season and never scored more than 12 goals in a season. He was nowhere close to be worth a 5M contract.
Correct. However, KK could have just as easily taken a bridge contract like Alexis Lafrenière just did. When the bridge contract is up, the hope on the player's end is that they've improved to the point he can maximize his value.
Baseball has a few examples of teams that will give out a long term contract to a prospect that they have high hopes for, despite those prospects not having much (if any) MLB experience. This is somewhat similar, but it's a much bigger gamble for both the player & the team in baseball because they don't know how good the player actually is. Might be an all-star, might be a bust.
I totally get the not gambling on yourself argument but it was a really generous contract given his accomplishments at this point of his career.
It's actually not all that generous when you know the inner-workings of the contract & CBA. It's an incredibly team-friendly deal and not all that great for the player, beyond just the $$ aspect.
Despite, as you mentioned earlier, only getting 12 goals in his best season and coming off a 29 point season in his first season in Carolina, why do you think Carolina was so interested in giving him an eight year deal to lock him up during his prime years? Probably because they see him a player with upside, or a player that can grow or a player that can [insert reason here]. Whatever the reason may be, they see something in him.
That contract also has an escape clause for the team had Kotkaniemi not panned out, and that's still TBD.
Players who are less than 26 years old and under contract can be bought out at 1/3 of the cost spread out over twice the amount of remaining years instead of the 2/3 of the cost over twice the remaining years.
So if KK ended up not being worth it, Carolina has until July 2026 to buy him out at a meager caphit of $850k or $470k (depending on the years) for twice the remaining years. If he is worth it, they keep him.
It gives Carolina the best of both worlds: They gamble on a player during his prime and if the gamble pays off, they have a player under market value. If it doesn't pay off, they always have the option of buying him out at a small fraction of the cost.