NHL buyouts came into existence when the salary cap was introduced for the 2005/2006 season after the year-long lockout. Here’s a quick recap on the buyout rules.
Teams can buyout out a player to obtain a reduced salary cap hit, however, it extends over a period twice the length of the remaining contract. If a player has one year remaining, his buyout cap hit spreads out over two years. The buyout amount depends on the age of the player. If a player is younger than 26 years of age then the buyout cost is 1/3 of the original salary. If the player is 26 or older then the buyout is 2/3 of the remaining contract value.
Curtis Brown holds the distinction of being the first NHL player bought out of his contract. Brown signed a four-year free agent contract with the Chicago Blackhawks on July 2nd, 2004. The first year of his deal was the lockout season, and it essentially evaporated. He played the 2005/2006 season with the Hawks and scored 5-10-15.
On June 26th, 2006, they bought out of the final two years of his contact and the history of NHL buyouts in the salary cap era began.
Brown was the first, but since then another 158 players have been bought out.
Current Wild GM, Bill Guerin, was the second player to be bought out on June 30th, 2006. He signed a five-year deal with the Dallas Stars on July 3rd, 2002 ($8.866m AVV). He had one year remaining on his deal when the Stars bought him out. Due to the 24% rollback, part of the new CBA, Guerin’s AAV in the final year was $6.738 million. He scored 13-27-40 in 2005/2006 and Dallas bought him out with a two-year cap hit of $2.246 million.
Guerin signed a one-year, $2.4m deal with St. Louis and promptly scored 36-20-56 split between the Blues and San Jose Sharks, who acquired him at the trade deadline. That earned him a two-year deal with the New York Islanders ($4.5m AAV) where he scored 23 goals and 44 points the first year, and then he was traded at the 2009 deadline to Pittsburgh and won a Stanley Cup. He signed a one-year deal, the final contract of his career ($2m AAV) with the Penguins in the summer of 2009 and in his final NHL season he scored 21-24-45 in 78 games when he was 39 years old.
Guerin is one of many players who was bought out, but then signed with a new team. The new team got him on a much better contract and reaped the rewards.
After another lockout, the NHL and NHLPA agreed on a compliance buyout. The same rules of compensation (2/3 for players 26 and over), but there would be no future cap hit penalty. The teams would owe the player money, but it wouldn’t count against their salary cap.
Teams took advantage of this with 21 players being bought out in 2013 and another 13 in 2014. Some long-term deals were bought out.
The Islanders bought out the final eight years of Rick Dipietro’s $4.5m AAV contract. They are paying him $1.5m until the 2028/2029 season.
Buffalo bought out Christian Ehrhoff’s final seven seasons ($4mAAV). He only played three years of his 10-year deal, but earned $22 million in those three seasons. The final seven years the Sabres owed him $18m and they are paying him $857,143/year until 2027/2028.
The Flyers bought out the final seven years of Ilya Bryzgalov’s ($4.653m AAV) contract. He’d signed for nine years, but only played two for the Flyers and they pay him $1.642m/year until 2026/2027.
The New York Rangers bought out the final six seasons of Brad Richard’s nine year ($6.66m AAV) contract. He is owed $1.055m/year until 2025/2026.
And the biggest buyout, in actual money, belongs to the Tampa Bay Lightning. On June 27th, 2013, they bought out the final seven years of Vincent Lecavalier’s 11 year ($7.727m AAV) contract. They paid $4,761,905 the first two years, then $3,761,905 for one year and the final 11 years they owe him $1,761,905 until 2026/2027. The total buyout payout was $32,666,667.
Lecavalier signed a five-year ($4.5m AAV) with the Philadelphia Flyers five days later. He retired with two years remaining on the contract, but when you are getting almost $2m a year from Tampa it is easy to retire and walk away from the $6m that was owed in cash in those final two years.
Last year produced 11 buyouts.
Andrew MacDonald, Ryan Spooner and Scott Darling played in Europe. Dion Phaneuf and David Schlemko didn’t play. Spooner and Phaneuf became the first two players where their cap hit was split between two teams. Ottawa retained some of his salary in the trade, and they had a $1.354m cap hit last year and this season and then $354K for two more seasons, while the Kings, who bought him out, had a $4.062m cap hit last year and this season and will have $1.062m for the two more years. Vancouver had $1.033m for two years for buying out Spooner, while the Rangers have $300K for two years.
Michael Stone’s ($3.5m AAV) final two years of his deal were bought out by the Calgary Flames on August 1st, but then he re-signed with the Flames on September 11th for one-year at $700,000.
Patrick Marleau ($6m AAV) was traded from Toronto to Carolina for a 1st round pick, and then the Canes bought out the final year of his deal. He signed a one-year deal at $700,000 with San Jose.
Valeri Nichuskin ($2.95m AAV) was bought out of the final year of his deal by the Dallas Stars. He signed a one-year, $850,000 deal with Colorado.
Kevin Shattenkirk ($6.65m AAV) was bought out of the final two years of his deal by the New York Rangers. He signed a one-year, $1.75m deal with Tampa.
Andrej Sekera ($5.5m AAV) was bought out of the final two years of his deal by the Edmonton Oilers. He signed a one-year, $2m deal with Dallas.
Corey Perry (8.625m AAV) had his final two years bought out by the Anaheim Ducks. He signed for one year with Dallas with a base salary of $1.5m and bonuses up to $1.75m. He’s earned $1.6m of his bonuses. If the Stars win the Cup he will earn the other $150K.
Every year we see buyouts, and based on the trend of the past five season, I don’t see it changing moving forward.
2019: 11 buyouts
Earlier today we saw reports of our first buyout of 2020. Ottawa will buyout Bobby Ryan.
Bobby Ryan has 2 years of $7.25M Cap Hit & 2 years of $5.5M Base + $2M Signing Bonus ($15M total) remaining on deal.
-Cap Hit: $3.58M (saves $3.7M), $3.58M (saves $3.7M), $1.83M, $1.83M
-Cost: $7.33M ($1.83M*4 ) + $4M SB = $11.33M, saves $3.67M https://t.co/WQrrSVPaWT https://t.co/ApUJXA0Ryh pic.twitter.com/6btvQUTq5F
— PuckPedia (@PuckPedia) September 25, 2020
I see people report how the Senators are saying $3.67m in real dollars. But are they? Unless they ensure their salary cap is $3.67m lower than last year, they aren’t saving any money. They will just give it to another player.
The crazy part about this is the Senators aren’t contenders yet, but with a bevy of young players they could be in a few years, but for two years they will have $1.833m in dead cap space, which makes it more difficult to compete.
They do save a lot in cap space, but if they don’t use the extra space properly they are simply redistributing money to another bad decision.
TEAMS WHO LOVE BUYOUTS…
As mentioned above we’ve seen 159 buyouts since 2006.
The New Jersey Devils have the most with 10, but four of them had actual cash paid out of less than $900,000. They had big ones in Mike Cammalleri and Anton Volchenkov.
But I looked at actual dollars paid out in buyouts since 2006 and the highest bought out player per team.
Tampa Bay: $44.8 million with six buyouts. $32.6m went to Vinny Lecavalier.
New York Islanders: $44.09m on four buyouts. Rick Dipietro, $24m. Alexei Yashin, $17.63m
New York Rangers: $36.9m on six buyouts. Brad Richards, $20.66m.
Philadelphia: $34.5m on six buyouts. Ilya Bryzgalov, $23m.
Toronto: $31.7m on eight buyouts. Mikhail Grabovski, $14.3m.
Buffalo: $26.6m with five buyouts. Ehrhoff, $12m.
New Jersey: $22.42m on 10 buyouts. Mike Cammalleri, $6.6m.
Carolina: $21.68m with eight buyouts. Alex Semin, $14m.
Columbus: $19m with seven buyouts. Fedor Tyutin, $5.833m.
Edmonton: $18.5m on seven buyouts. Andrej Sekera, $6m.
Anaheim: $18.1m in five buyouts. Corey Perry was most at $8m
Minnesota: $18.079m on six buyouts. Mark Parrish, $5.566m.
Arizona: $18m on five buyouts. Mike Ribeiro, $11.67m.
Florida: $17.07m on eight buyouts. Scott Darling, $4.733m.
Los Angeles: $14.69m on four buyouts. Dion Phaneuf, $8.375m.
Calgary: $13.98m on seven buyouts. Troy Brouwer, $6m.
Detroit: $13.66m on five buyouts. Stephen Weiss, $10m.
Nashville: $13.47m on seven buyouts. Viktor Stalberg, $4.66m.
Vancouver: $13.22m on five buyouts. Keith Ballard, $5.6m.
Montreal: $12.92m on seven buyouts. Scott Gomez and Tomas Kaberle, $3m.
Boston: $12.78m with seven buyouts. Glen Murray, $2.76m.
Colorado: $12.73m on five buyouts. Francois Beauchemin and Brooks Orpik each at $3m. *Traded for Orpik with purpose to buyout. Got Grubauer in deal.
Ottawa: $11.53m on six buyouts. Dion Phaneuf, $2.791m.
Dallas: $9.93m on five buyouts. Bill Guerin, $4.492m.
San Jose: $8.06m on three buyouts. Martin Havlat, $4m.
Chicago: $7.23m on three buyouts. Rostislav Olesz, $2.833m
Winnipeg/ATL: $4.36m on three buyouts. Alexei Zhitnik, $2.33m.
St.Louis: $3.39m on two buyouts. Jay McKee, $2.733m.
Washington: $3.08m on three buyouts. Jeff Schultz, $2m.
Pittsburgh has never had a buyout. Neither had Vegas, although they’ve only played three seasons.
CURRENT DEAD CAP SPACE
Here is the list of team’s and dead cap space due to buyouts (and retained salary via trades) for the coming season:
**Edit on October 12th to included 2020 buyouts.**
New York Rangers: $12.994m (Lundqvist is $5.5mm this year and drops to $1.5m next year, while Shattenkirk is $6.083m this year and $1.433 for the following two years.)
Los Angeles: $11.01m ($6.95m of that is due to terminated contracts of Ilya Kovalchuk and Mike Richards.)
Ottawa: $4.937m (They added $3.58m by buying out Bobby Ryan this October)
Edmonton: $4.583m ($750K retained salary of Milan Lucic)
Vancouver: $4.068m ($3.035m due to recapture penalty for Roberto Luongo).
Florida: $3.985m ($1.092 recapture of Luongo and $562K retained salary of Jason Demers).
Montreal: $3.958m (Alzner will drop to $1.958 next year and then $833K for two more years.)
New Jersey: $3.916 (recapture penalty of $250K for Kovalchuk).
Pittsburgh: $2.05m (retained salary of Nick Bjugstad).
Chicago: $1.75m ($1m is retained salary of Saad)
Boston: $1.5m (retained salary of David Backes).
Toronto: $1.2m (retained salary of Phil Kessel).
Vegas: $500K (Retained salary of Tomas Tatar).
Currently seven teams (Colorado, New York Islanders, San Jose, St. Louis, Tampa Bay, Washington, Winnipeg) have all of the $81.5m in cap space available to spend on their active roster. That is a big advantage, especially for teams like the Avalanche, Islanders, Blues, Lighting and Capitals, who look to be legit contenders next season.
The buyout period officially begins today, but fans, and management, should change their focus from believing buyouts are a good thing. They are only a temporary fix, and usually occur due to a previous over evaluation of a player. You’d be better off trading them, retaining some salary, than buying them out and having dead cap space past the end of their original contract.
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