SalarySwishSalarySwish
Forums/Site Discussion

Buyout rules.

3 févr. 2021 à 23 h 11
#1
Avatar de l'utilisateur
Rejoint: juin 2017
Messages: 19
Mentions "j'aime": 0
I don't understand the buyout rules. I look at Kevin Shattenkirk buyout with the New York Rangers. The Buyout happened in August 1, 2019. Shattenkirk had a remaining cash value on the contract of $6.6M in 2019/20 and $4M in 2020/21 or $10.6M. The Cap hit on each year was $6.65M or $13.3M for two years. Shattenkirk signed with the Lightning for the 2019/2020 season for $1.75M and then signed a 3 year $11.7M contract with Anaheim. Here's where I get confused. As I understand the rule, A player who is over 26 gets his contract bought out for 2/3 value which would be $7,066,666,67 spread out over 4 years. That would be $1,766,666,67 over 4 year at cash value. If you used the cap figure of $13.3M the buyout total would be $8,866,666.67 or $2,216,666.67 for 4 years.
What is listed is Amount of Buyout $5,733,333.33 Then in the cap hit section I see (2019/20 $1,433,333.00) (2020/21 $6,083,333.00) (2021/22 $1,433,333.00) (2022/23 $1,433,333.00) This equals $10,383,332

I don't get the logic here
4 févr. 2021 à 1 h 35
#2
Ban Price trades
Avatar de l'utilisateur
Rejoint: oct. 2017
Messages: 6,474
Mentions "j'aime": 6,450
Modifié 4 févr. 2021 à 1 h 42
Quoting: RickSJ207
I don't understand the buyout rules. I look at Kevin Shattenkirk buyout with the New York Rangers. The Buyout happened in August 1, 2019. Shattenkirk had a remaining cash value on the contract of $6.6M in 2019/20 and $4M in 2020/21 or $10.6M. The Cap hit on each year was $6.65M or $13.3M for two years. Shattenkirk signed with the Lightning for the 2019/2020 season for $1.75M and then signed a 3 year $11.7M contract with Anaheim. Here's where I get confused. As I understand the rule, A player who is over 26 gets his contract bought out for 2/3 value which would be $7,066,666,67 spread out over 4 years. That would be $1,766,666,67 over 4 year at cash value. If you used the cap figure of $13.3M the buyout total would be $8,866,666.67 or $2,216,666.67 for 4 years.
What is listed is Amount of Buyout $5,733,333.33 Then in the cap hit section I see (2019/20 $1,433,333.00) (2020/21 $6,083,333.00) (2021/22 $1,433,333.00) (2022/23 $1,433,333.00) This equals $10,383,332

I don't get the logic here


So the math isn't as cut-and-dry as you're making it out to be. You got some of it right though, I'll walk you through the rest:

1. It's not the contract AAV that goes through the "two-thirds and double the remaining length" math, but the actual cash dollars of salary remaining. Here you used Shattenkirk's AAV of $6.65M when in reality he was only owed $6.6M and $2M in the back two years of his deal. The number we want to work with for this equation is $8.6M. Dividing by 2/3 gives us $5.733333M and applying that over four years is $1.433333M

2. To determine the cap savings for each year, we have to subtract Shattenkirk's remaining salary by the number we reached above. Because he was owed $6.6M in year 3, the cap savings will be $5.266667M. The year 4 savings are substantially less because he was only owed $2M real dollars in salary: this means the year 4 savings are only $0.516667M. The two additional years of the buyout contain no salaried contract years and are just equal to the base value of $1.433333M each.

3. Determining the cap hit of the buyout is when Shattenkirk's AAV of $6.65M comes into play: you subtract the cap savings from AAV remaining in order to determine the cap hit of each year of the buyout. Thus, the four years of the Shattenkirk buyout is as follows:

Year 1: $1.483333M against the cap
Year 2: $6.083333M against the cap
Year 3: $1.433333M against the cap
Year 4: $1.433333M against the cap

This is how the buyout total gives us a value of $10.433332M. The real hiccup here is that Shattenkirk's signing bonus spiked the buyout cap hit because they aren't a part of the salary he would have otherwise earned in those final two seasons. That low cap-savings value we calculated results in that really jarring, high value in year 2 of the buyout.

Here's CapFriendly's link to the buyout FAQ: https://www.capfriendly.com/buyout-faq

I followed the steps 1-4 in order to do the math here. Hope this helps!
Kotkaniemi15, justaBoss et RickSJ207 a aimé ceci.
 
Répondre
To create a post please Login or S'inscrire
Question:
Options:
Ajouter une option
Soumettre le sondage