Compliance Buy Out

[Donnie D]

The owner's proposal would allow one player to be bought out prior to the 2013 - 2014 season and not count against the cap hit. The obvious candidate would seem to be Ohlund, but if he is bought out next year, it really isn't too bad of a cap hit. I don't believe that this provision would help the Lightning much. They don't have a Luango type contract (other than Vinny???) or player buried in the minors. I could see them doing it to Ohlund just to remove his salary.

[ChaseSpace]

Most likely Ohlund. If they buy-out Vinny then the backlash would be tremendous.

[Mike]

Originally Posted by Donnie D

The obvious candidate would seem to be Ohlund

Obvious answer is obvious.

if [Ohlund] is bought out next year, it really isn't too bad of a cap hit. I don't believe that this provision would help the Lightning much.

It'd be great, actually. Prior to the lockout, Ohlund was owed a remaining $11.75m on his deal. If the Lightning end up only paying him 50% for this season, that's only $9.25m remaining and if the buyout terms are still the same (2/3 of remaining amount on contract), that's $6.17m to shed a $3.6m cap hit for this and three remaining seasons.

I could see them doing it to Ohlund just to remove his salary.

You have to think of him as dead cap-space. There's no easier tell than looking at the Salo signing to realize that Ohlund is done here. Buying out Ohlund is smart in all facets: you're cutting loose a non-contributor, saving some real $ in the process and getting within or very close to cap compliance in the pending CBA (assuming the $60m figure being floated around as the league's proposal is accurate and the player's don't try to bargain a higher number).

[Mike]

Originally Posted by ChaseSpace

Most likely Ohlund. If they buy-out Vinny then the backlash would be tremendous.

Yes, any Vinny talk needs to be nipped in the bud before it happens. If it absolutely came to having to clear Vinny's salary, you trade Vinny before buying him out, which would be horrendous asset management.

Using the same assumptions I made with Ohlund, the Lightning would be obligated to pay Vinny approximately $50m over the remaining term of his deal. That's a shade over $33m in real salary you're going to fork over to get cap compliant before having to address the gaping hole you created in your second line. All the while, yes, pissing off a significant portion of your fanbase. Es no bueno.

[aapbolt]

Will other teams use the one time buyout provision to unload white elephant contracts and if so could any of those players be singable for less and could they help us. Further if the cap is 60 million, how close are we and other teams to the cap and how will contracts be cut or players released to meet the cap? Which of course leads to maybe we can improve our team by adding players who are released.

[ChaseSpace]

Originally Posted by aapbolt

Will other teams use the one time buyout provision to unload white elephant contracts and if so could any of those players be singable for less and could they help us. Further if the cap is 60 million, how close are we and other teams to the cap and how will contracts be cut or players released to meet the cap? Which of course leads to maybe we can improve our team by adding players who are released.

If they're treating the cap the same way now as the owners wanted it done earlier in negotiations then while it is a $60million cap teams would be allowed to exceed it for a year(I'm guessing they would extend that into next season since this would only be a half season) before they have to get under the cap limit.

[aapbolt]

Thanks Chase, I thought about the allowance over the cap, but also thought they might set a limit on the overage. You are surely correct that they would extend because this year will be shortened. It should be interesting to see what happens.

[Donnie D]

Under the owner's proposal, you would get to exceed the $60 million cap this year. Next year it drops to $60 million. To get my head around this issue, I had to rethink the whole concept and understand that the purpose of the compliance cap isn't to allow teams to dump a bad salary, it is to allow teams a mechanism to get under the cap next year without having that one contract still count against the cap.

For the Lightning (according to capgeek), without Ohlund, the team comes into next year with 14 players signed with a cap hit of $54,659,524. That leaves $5,340,476 in available cap space. They need to sign a goalie, a minimum of 4 forwards and 1 defenseman. With 2 subs, the Lightning would have to add 8 players.

The numbers are relatively straight forward. 8 players at $600,000 is $4.8 million. So thank goodness for the young, relatively inexpensive players in Syracuse, right? Except that many of those players are signed next year for more than the minimum. Brown is an RFA and this year's contract is for $1.35 million. Conacher is signed for $925,000. Panik and Johnson for $900,000 each. Killorn at $875,000. Barberio and Gudas are RFAs.

My point is that, at first blush, while Ohlund would seem to be the obvious buyout candidate, I'm not sure that the Lightning can get to a $60 million cap just by dumping his salary. The negotiations are still fluid and the cap could rise as we go on - but under the owner's proposal, the Lightning would have to have to buy out Ohlund using the current system AND they would have to dump a larger cap hit. When you factor in the $607,000 cost to buy out Ohlund you have to find a very large complaince buyout to get below the cap. The largest contracts are:

Vinny - $7.7 million
Stammer - $7.5 million
St. Louis $5.6 million
Malone & Purcell - $4.5 million each
Carle - $5.5 million

If the owner's proposal stays as it is, the Lightning have a huge problem. They aren't going to be looking to add someone elses compliance buyout, they are going to be looking at dumping Ohlund and at least one of the above contracts next year. And when you do that, the other contract may have to be the compliance contract because there is greater savings than using Ohlund's contract. The way I see it, that means Vinny, St. Louis, Malone, Purcell or Carle have to be the compliance contract.

If my logic is off, please feel free to correct me.

[Mike]

Originally Posted by Donnie D

If the owner's proposal stays as it is, the Lightning have a huge problem.

It will be a thorn in Yzerman's side but I wouldn't fret quite yet.

They aren't going to be looking to add someone elses compliance buyout, they are going to be looking at dumping Ohlund and at least one of the above contracts next year. And when you do that, the other contract may have to be the compliance contract because there is greater savings than using Ohlund's contract...The way I see it, that means Vinny, St. Louis, Malone, Purcell or Carle have to be the compliance contract.

None of them have to be, no. The first obvious problem with buying out anybody but Ohlund is that, unless Ohlund retires, he's going to be dead cap-space for three more seasons. There is no other option than buying him out or him retiring. The others present you an additional option: recapturing cap space via trade.

You can buy out Ohlund and trade another contract. Now, I've got my suspicions as to would be sent packing (hint: aging winger has a no-movement clause that, after the 2012-2013 season, modifies into a no-trade clause that allows him to submit a 12-team list of clubs he'd approve a trade to) but the point is you have options.

Maybe Yzerman would have difficulty, due to the financial dynamics at play, of finding many suitors and/or getting a return he could stomach but I have little doubt he can swing a trade to free up the necessary room to bring up the young guns still on somewhat-pricey entry-level contracts and sign Barberio to modest, first one-way deal. You already have Lindback locked up and you have a ready-made back-up in Helenius, who's already under contract for $600k.

Buying out Vinny remains very problematic in that, unless you're prepared to go ultra-cheap and make your club significantly weaker down the middle, you're not going to save much of that $7.7m cap hit when you replace him and the cost, in real $ ($33m), is exorbitant. It's not a cure-all to the problem by any stretch of the imagination.

Matt Carle would be similarly cost-prohibitive in terms of real $ ($20m), he's your marquee signing of the past summer and you're diluting the depth at the position you've been weakest at in recent seasons. Ultra dumb.

If you had to go buyout one of the contracts you mentioned, the most cost-effective, in terms of real $, in terms of a buyout and easiest to replace are St. Louis, Malone and Purcell. If you decide to buyout Ohlund, the easiest to trade may very well still be St. Louis, Malone and Purcell.

[Hoek]

If the Lightning are in trouble then a lot of other teams are in much deeper doodoo. I think an Ohlund buyout and Malone dump should be enough for us.