Is there a reason to talk buyout and Joffrey Lupul?

One year ago today, I wrote a story about three possible Maple Leafs’ buyout candidates.  One year on, we’ve tried to forget the saga of Jared Cowen, even if we shouldn’t, and the idea of buying out Tyler Bozak now seems really hilarious.  It was merely laughable last year, yet some fans were in favour of it.

The third name in that story was Joffrey Lupul.  My conclusion then was that buying him out last summer was unwise, but looking at it again this summer might be a good idea.  So I’m looking.

The Numbers

Lupul has one season left on his contract with a cap hit and AAV of $5,250,000. The cash salary for this final year is $3,750,000.  This contract was designed to be one that could be traded or bought out in its final year.

That big drop in salary makes a buyout now not so painful.  The Cap Friendly buyout numbers are:

Joffrey Lupul Buyout Summer 2017

So the buyout saves the Leafs 2.5 million dollars in cap for the coming year and adds 1.25 million dollars next year to the cap.

The actual amount of salary paid out is $1,250,000 less.  The Leafs would also gain back the SPC space one year earlier.

Could the Leafs do this?

Yes, absolutely.

A player must be placed on unconditional waivers before they can be bought out. The only time a player can refuse that part of the process is if he has a no-move clause. All that does is speed it up, it doesn’t stop it.  Cap Friendly says Lupul just has a no-trade clause. So he can be waived.

Well, he can if he’s healthy.

And this is where it gets complicated, and we need to remember the Cowen case. Cowen was bought out last summer at this time, and he contested the buyout on the grounds that he was injured and had not consented to the waiver process.  Cowen ultimately lost that case, the buyout went through, and he is a UFA right now.

So is Lupul healthy?

It was announced he had failed a physical in training camp. He left the team permanently, and was placed on LTIR according to media reports. However, he was not included on the NHL’s list of players exempt from the expansion draft due to career-ending injuries.

We don’t know what his health status is now. We also don’t know how the NHL made that exemption list or if that means anything. The bottom line is: if Lupul passes a physical now, he can be bought out.

If he doesn’t, he can still be bought out with his consent.

Would Lupul do that?

Maybe. The cost benefit analysis to him only makes sense if he believes he can still play somewhere and wants to have a chance before he’s another year older.

If all he wants is to sit in California taking up hobbies like linguistics or stamp collecting, he can just keep drawing his last year of full salary, and this is a moot point.

If he wants to play, taking the small cut in pay — after escrow, that’s approximately one million dollars less — might get him more money in the long run, and one more year of hockey.

Would the Leafs do it?

Lupul’s choice is simple. It’s about hope. The Leafs, however, are trying to guess their future cap needs to decide what they want to do.

The small savings in the coming season is not a large incentive. The smaller hit the year after is not a large deterrent either.  And if Lupul is injured enough for LTIR still, they have no pressing need to clear part of his cap hit unless they want to run as a cap ceiling team all year.

If they plan to, or even hope to, run at or near the salary cap limit, then that savings is either more space spent on an active player, or a good chunk of bonus overages they can avoid shifting to next year. (Bonuses that put a team over the cap can’t be absorbed by LTIR space.)

To know if the Leafs would or should make this move would require us to know their plans this year and next.  Less dead money means more flexibility usually.  Is having a large chunk of Lupul’s cap hit gone completely worth not being able to put all of it on LTIR?

The answer could depend on how much the Leafs want to avoid bonus overages flowing into the 2018/2019 season. They’d have to be more than the 1.25 million of the buyout cap hit that carries into that year to even make it add up.  But they could be much more than that, as they were in excess of five million this season.

Of course, if Lupul is able to pass a physical, this dilemma for the Leafs becomes completely different.  If he is fit and playable to the extent that the league won’t sign off on LTIR, then a buyout is the best option short of a trade to clear that large chunk of cap space.

Why not just trade the contract?

There doesn’t seem to be as big a market for floor-clearing contracts this summer.  But that hasn’t stopped Columbus from seemingly moving David Clarkson’s contract to Vegas.

In a radio spot, Elliotte Friedman said that the deal might be done.

Friedman says he thinks CBJ & VGK have a deal where David Clarkson lands in Vegas, along with a 1st + prospect (960).

— RCN (@akaRCN) June 12, 2017

Clarkson is on the list of expansion draft exemptions.  So in addition to his contract, Vegas still gets to take a player from Columbus.  That is one steep price to move a chunk of dead cap space instead of just using LTIR.

If a trade to get Lupul’s contract off the books would cost that much, a buyout is a much, much better deal.

All of this depends on Lupul’s heath and what he wants to do in the future versus how much the Leafs value that extra cap space and SPC slot.  The most likely outcome is that nothing changes, and next summer, the only vestige of the old regime still on the Leafs’ books will be the last two years of Nathan Horton’s contract.