OT: Penguins offseason.

[ChiefJusticeMarshall]

Now the NHL's season is officially over, things are going to move rapidly as the draft is this weekend, and free agency next week. I just want to clarify things in regards to "buyouts".

To highlight how a "buyout" works.
First of all, to any guy on a 35+ contract, there is no "buyout". You can cut, demote, but you are paying it. That is why the Pens were stuck with Jeff Carter. So buying out say Geno or Letang does nothing for you.

Here are the rules, and then a good example of application:
For players that are 26 or older, a buyout is 2/3 of the remaining salary owed on the contract. For players that are under 26, a buyout is 1/3 of the remaining salary owed on the contract. All buyouts are spread out over twice the remaining years of the contract.

So what does this mean? Say you want to buy out Ryan Graves. According to CapFriendly, he has 5 years remaining at an AAV of $4.5 Million per year. Buying him out? That means the cap hit for the Pens will be $3 million for the next TEN YEARS!!! Same with Jarry. He is owed $5.375 per year over the next 4. A buyout means the cap hit would be $3.6 million over 8 years.

That is why say you can get a trade for Graves, and you would have to retain $1.5 million per year, even if it is a bag of pucks, it is much better for your cap and long (and short) term than a buyout. The Pens are still paying against the cap for Jack Johnson the next 2 seasons at ~ $900K per year.

For guys under the age of 26, it is 1/3 the AAV (cap hit) over twice the life of the contract.

Hope this helps if there are questions.

 

[goalieman]

Now the NHL's season is officially over, things are going to move rapidly as the draft is this weekend, and free agency next week. I just want to clarify things in regards to "buyouts".

To highlight how a "buyout" works.
First of all, to any guy on a 35+ contract, there is no "buyout". You can cut, demote, but you are paying it. That is why the Pens were stuck with Jeff Carter. So buying out say Geno or Letang does nothing for you.

Here are the rules, and then a good example of application:
For players that are 26 or older, a buyout is 2/3 of the remaining salary owed on the contract. For players that are under 26, a buyout is 1/3 of the remaining salary owed on the contract. All buyouts are spread out over twice the remaining years of the contract.

So what does this mean? Say you want to buy out Ryan Graves. According to CapFriendly, he has 5 years remaining at an AAV of $4.5 Million per year. Buying him out? That means the cap hit for the Pens will be $3 million for the next TEN YEARS!!! Same with Jarry. He is owed $5.375 per year over the next 4. A buyout means the cap hit would be $3.6 million over 8 years.

That is why say you can get a trade for Graves, and you would have to retain $1.5 million per year, even if it is a bag of pucks, it is much better for your cap and long (and short) term than a buyout. The Pens are still paying against the cap for Jack Johnson the next 2 seasons at ~ $900K per year.

For guys under the age of 26, it is 1/3 the AAV (cap hit) over twice the life of the contract.

Hope this helps if there are questions.

- Thanks for opening an offseason thread as things are about to get interesting with trades, the NHL draft, and free agency all about to happen.

- We had a detailed discussion of buyouts a month or two ago, I think, in that "Forgotten Pens" thread when someone inquired about buying out Jarry ...... it is a lot more complicated and works a little differently then you mentioned ......

- There are 2 separate issues in buyouts ....1) How much money does the team owe the player over what period of time and 2) What is the cap hit on the team each year in a buyout ...... they are calculated differently.

- Also, some contracts in players 35+ can be bought out with a reduction in cap hit in the exact same way younger players contract buyouts work and in others there is no change in structure or decrease in the amount of cap hit as you mentioned above ....... if a 35+contract is 2 years or longer and has a signing bonus in the 2nd or later years OR is front loaded in salary, there will be no decrease/change in the cap hit in a buyout .... but if the 35+ contract has no signing bonuses after the 1st year and salary does not decrease after the 1st year, the player can be bought out with the same reduction in cap hit as a younger player buyout ..... you are correct that both Malkin and Letang have 35+ contracts structured such that a buyout would not reduce the cap hit.

- Let's take a buyout of Jarry (again I went over his exact example in that other thread) ...... first, to calculate the money owed to the player by the team (and since Jarry is older than 26), you take 2/3 of his remaining base salary in his contract and add 100% of his signing bonuses (which have to be paid off in full) to that and pay it off over twice the number of years left in the contract ....... the amount may vary year to year depending on signing bonuses each year ...... Jarry, for example, has $12,575,000 base salary remaining on his contract (has different base salaries each year) and $7,500,000 in signing bonuses (a total of 20,075,000) over 4 years left on the contract ...... so, the amount the Pens would have to pay him over 8 years in salary and bonuses would be 2/3 x 12,575,000 = 8,383,333,33 + 7,500,000 = $15, 883,333.33 (instead of 20,075,000 over 4 years without a buyout) ...... you would pay the reduced base salary in equal amounts each year x 8 (1,047,917 per year) and add to that whatever the signing bonus is that year (the total over 8 years would be 15,883,333.33).

- Above is salary owed to the player, but what would the cap hit each year over the 8 years be to buyout Jarry (it is recalculated each year depending on what is left on the contract and thus may differ year to year) ..... to calculate the cap hit each year there are 3 steps ..... Step 1) Multiply the remaining base salary left on the contract (12,575,000) x 2/3 = 8,383,333 and divide by the number of years on the buyout (8) = $1,047,917 which is the BUYOUT COST per year x 8 years ....... Step 2) Determine the savings to the team that year which = Base salary that year minus the buyout cost (this next year it would be $5,400,000 in base salary - 1,047,917 buyout cost = $4,352,083 in savings ...... Step 3) the cap hit next year would be, AAV Cap Hit ($5,375,000) - Savings that year ($4,352,083) = Cap Hit the 1st year to buyout Jarry would be $1,022,917

- Do the calculations each year and the cap hit to buyout Jarry would be ... Year 1 = $1,022,917 .... Year 2 = $1,997,917 ..... Year 3 = $5,297,917 ...... Year 4 = $4,797,917 ....... Years 5 thru 8 = $1,047,917 each year for 4 years OR a total cap hit of $17,308,336 over 8 years instead of $21,500,000 (AAV cap hit of 5,375,000 x 4 years) over 4 years without a buyout.

- Sorry for the long, complicated post but wanted to point out the buyout process is somewhat complex and most general managers don't like to buyout players which I think your post implied.

 

[goalieman]

Dubas has a tough job ...... he wants to help improve the team for next year while building for the future with draft picks and adding prospects ....... hard to do both.

Needs for next years team seem to be a top 6 forward, a bottom 6 forward who can score some goals, a top 4 left defenseman, and figure out the goalie situation all while trying to get future players and prospects ....... he has trades, draft picks, UFA signings, and development of players already in the system to accomplish his objectives ...... seems unlikely he will be able to do everything he wants to.

Will DOC and/or Puustinen develop into better goal scorers on the bottom 6, can they trade Reilly Smith to open cap space and sign a top 6 forward in free agency, can POJ continue to play like he did the last 3+ weeks of the season with Letang or Graves have a comeback season to become solid top 4 defensemen or do they trade for one, do they go with Jarry and Ned in goal or trade one and bring in a veteran or promote Blomqvist (is he ready ?), can Poulin and Puljujarvi be part of an effective 4th line ...... what trades, UFA signings, draft picks will they make and will more of their moves be to build for the future at this point ....... so many possibilities, hard to predict what Dubas will do but will be interesting to see what happens very soon !

 

[ChiefJusticeMarshall]

Dubas has a tough job ...... he wants to help improve the team for next year while building for the future with draft picks and adding prospects ....... hard to do both.

Needs for next years team seem to be a top 6 forward, a bottom 6 forward who can score some goals, a top 4 left defenseman, and figure out the goalie situation all while trying to get future players and prospects ....... he has trades, draft picks, UFA signings, and development of players already in the system to accomplish his objectives ...... seems unlikely he will be able to do everything he wants to.

Will DOC and/or Puustinen develop into better goal scorers on the bottom 6, can they trade Reilly Smith to open cap space and sign a top 6 forward in free agency, can POJ continue to play like he did the last 3+ weeks of the season with Letang or Graves have a comeback season to become solid top 4 defensemen or do they trade for one, do they go with Jarry and Ned in goal or trade one and bring in a veteran or promote Blomqvist (is he ready ?), can Poulin and Puljujarvi be part of an effective 4th line ...... what trades, UFA signings, draft picks will they make and will more of their moves be to build for the future at this point ....... so many possibilities, hard to predict what Dubas will do but will be interesting to see what happens very soon !

He does. The refusal to maybe admit that they needed to retool/rebuild a few years earlier really puts him against the wall. The first two things, and these are what we all can hope for, is Karlsson's last 12 games transfers over to next year, because that is who we were hoping to get. Secondly, he has to hope Graves rebounds somewhat, gets some confidence back and is a serviceable player.

Obviously the PP needs revamped and the next order of business is for the coaches to take over from the players and put guys in the best spots to succeed, even if that means taking someone like Geno off of the PP if he is not willing to change.

Obviously the bottom 6 needs rebuilt (again) but I would have fired Sullivan. I see no willingness from him to change anything and admit this is not the 2017 roster and they can't play that way anymore.