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Halifax • Canada • 33 Years Old • Male

Martin Havlat and LTIR

Posted 10:37 AM ET | Comments 0
There are several sites/posts around that will tell you that placing Martin Havlat on the LTIR list will magically fix the cap problem for this season. They'll also try to convince you that Havlat on LTIR creates this magical bag of cap space for the Sharks to head to the mall and use as they see fit.

They're wrong.

Martin Havlat being placed on the LTIR, as the cap situation stands now, wouldn't fix anything. A trade and then Havlat being placed on LTIR would fix the problem, or Havlat on LTIR and then a trade. In either account, a trade must occur with the best scenario being a trade first, then LTIR.

The CBA notes on LTIR are pretty cut and dry. Here's the example that applies to Martin Havlat:

Page 292, Article 50 - 50.10 Illustration 4

Illustration #4: The Upper Limit in a League Year is $70.0 million. A Player who has an SPC with an Averaged Amount of $2.0 million becomes unfit to play on the last day of Training Camp, and on the same day, his Club exercises the Bona-Fide Long-Term Injury/Illness Exception on such Player. On Opening Day, the Club has an Averaged Club Salary of $71.5 million (excluding Earnable Performance Bonuses up to the full amount of the Performance Bonus Cushion). The Club is deemed to have already fully replaced the unfit-to-play Player with any Player or Players on the Opening Day Roster. If these replacements are maintained through the conclusion of the season, the Club's Averaged Club Salary is $71.5 million, as the Club is permitted to exceed the Upper Limit by $1.5 million because of the Bona-Fide Long-Term Injury/Illness Exception.

So, as you can see, if the Sharks are over the cap when they place Havlat on LTIR, the Sharks gain absolutely nothing from the move, other than being allowed to be a shade over $400K on top of the cap. So, what's the point in placing a player on LTIR, who has a big contract, that provides no real "relief"?

The goal of the Sharks will be to get under the cap before placing Havlat on LTIR so they can utilize his cap relief to the full extent via this example:

Page 291, Article 50 - 50.10 General Illustration

A Player with a Player Salary of $1.5 million becomes unfit to play for more than 24 calendar days and 10 NHL Regular Season games. At the time the Player becomes unfit to play, his Club has an Averaged Club Salary of $69.5 million, and the Upper Limit in that League Year is $70 million. The Club may replace the unfit-to-play Player with another Player or Players with an aggregate Player Salary and Bonuses of up to $1.5 million. The first $500,000 of such replacement Player Salary and Bonuses shall count toward the Club's Averaged Club Salary, bringing the Averaged Club Salary to the Upper Limit. The Club may then exceed the Upper Limit by up to another $1 million as a result of the replacement Player Salary and Bonuses. However, if the unfit-to-play Player once again becomes fit to play, and the Club has not otherwise created any Payroll Room during the interim period, then the Player shall not be permitted to rejoin the Club until such time as the Club reduces its Averaged Club Salary to below the Upper Limit.

Under this illustration the Sharks would be able to gain cap space. Should the Sharks get under the cap by, say, $1M via trade and then place Havlat with his $5M cap hit on LTIR they would be able to spend $4M over the cap. Is it circumvention? Absolutely. Is it illegal? Nope.

The obvious play is to get under, but as close to as possible, the cap ceiling before placing Havlat on LTIR. That gives the Sharks the wiggle room to make additional moves to fill out their roster for opening night.

Should they want to bring Havlat back off LTIR for any reason during the season, maybe so they can buy him out with an amnesty at the end of the year, they would need to get back under the original cap ceiling. That move could come at the deadline via trade involving one of Thornton, Marleau or Boyle, should the Sharks choose that route.

Overall, the Sharks placing Havlat on LTIR without making any other moves isn't their "only option", but it is a last resort to become cap compliant for the opening day. It's the worst case scenario, but it's a scenario nonetheless. Doug Wilson's intentions, most likely, are to get under the cap then make the LTIR move for Havlat.

Here's a prediction for the Havlat saga:

Trade -> Havlat to LTIR -> Thornton/Marleau/Boyle Trade -> Havlat off LTIR -> Amnesty

That's all for now, thanks for reading.

Stay icy, Sharks fans.
Filed Under:   NHL   Sharks   Martin Havlat  
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