Confirmed with Link: Nathan Horton to Toronto for David Clarkson

[We Want Ten]

Mostly because LTIR doesn't actually work that way.

It allows them to go over the cap in season.

 

[NotWendell]

It allows them to go over the cap in season.

That's a good way to explain it.

 

[EspenK]

That, and there's also bonus implications for any offseason shopping (LTIR doesn't count for season-starting cap compliance), among other fun details.

Don't get me wrong; it still works nicely for them. It's just not an automatic get-out-of-jail-free card. There are some parole conditions.

I don't think this is right. I think it does if the team does it correctly. Here is a link to an archived capgeek page explaining it all. See Example of how the Bruins got Marc Savard's contract fully covered by LITR on day 1.

http://web.archive.org/web/20141005074923/http://www.capgeek.com/faq/how-does-long-term-injured-reserve-LTIR-work

 

[Tyler Biggs*]

Definitely. Any other team would have wanted the Leafs to take a huge piece of Clarksons salary back for the next 5 years. The Horton trade is about cap relief, not about Horton.

 

[Derby]

Can anyone give me a quick explanation of what is the benefit to Toronto in this trade? Please avoid sarcasm, lol. I have a friend asking for a simple explanation of the thinking from the Leafs' perspective. Thanks.

 

[Fro]

they can LTIR Horton and afford to pay him to do nothing and free up cap space...we could not afford as a budget team to pay him to do nothing since he wasn't insured

 

[Johansen2Foligno]

Can anyone give me a quick explanation of what is the benefit to Toronto in this trade? Please avoid sarcasm, lol. I have a friend asking for a simple explanation of the thinking from the Leafs' perspective. Thanks.

They get rid of the worst contract in the NHL.

They can put Horton on LTIR and that saves them a little over $5M in cap space they can use during the year but not in the off season.

 

[1857 Howitzer]

Can anyone give me a quick explanation of what is the benefit to Toronto in this trade? Please avoid sarcasm, lol. I have a friend asking for a simple explanation of the thinking from the Leafs' perspective. Thanks.

The biggest benefit for Toronto is a physiological/culture change. They seem to be going into a full rebuild and rightfully or wrongly Clarkson was viewed as part of the core that needs to be removed. He had become a lighting rod because of his production and the terrible almost unmovable contract that the TML gave him. Cap relief might have factored in, but no where to the extent that many seem to think. Toronto can only get cap relief if they are a cap team. If they truly are going into a full rebuild there is no chance they are going to be a cap team for the next 2-3 years and maybe even 4.

 

[NotWendell]

The biggest benefit for Toronto is a physiological/culture change. They seem to be going into a full rebuild and rightfully or wrongly Clarkson was viewed as part of the core that needs to be removed. He had become a lighting rod because of his production and the terrible almost unmovable contract that the TML gave him. Cap relief might have factored in, but no where to the extent that many seem to think. Toronto can only get cap relief if they are a cap team. If they truly are going into a full rebuild there is no chance they are going to be a cap team for the next 2-3 years and maybe even 4.

Spot on. This post is so full of awesome!

 

[Cyclones Rock]

Can anyone give me a quick explanation of what is the benefit to Toronto in this trade? Please avoid sarcasm, lol. I have a friend asking for a simple explanation of the thinking from the Leafs' perspective. Thanks.

The Toronto Maple Leafs may have only qualified for the NHL’s post-season once over the past 10 years – pulling it off in a shortened 48-game season – but they’re still the league’s most valuable franchise, according to Forbes’ annual rankings.

The last time Forbes ranked the 30 NHL teams according to value was in November of 2013. Toronto finished atop the list with an estimated $1.15 billion worth and the Rangers came in second at $850 million.

Wednesday, Forbes released its top 50 list of the most valuable sports franchises in the world. The top of the list was dominated by soccer teams, with Real Madrid, Barcelona and Manchester United taking the top three spots. Thirty of the 32 NFL franchises made the top 50 (Jacksonville and Oakland failed to make the cut) and six baseball teams made it. From the NHL, only Toronto cracked the all-world list.

The Leafs were sold to Bell Canada and Rogers Communications for $1.32 billion in 2012 and the two huge corporations co-own the team today. The Maple Leafs comes in at No. 26 on the Forbes list with their $1.15 billion valuation, just ahead of the Seattle Seahawks and Pittsburgh Steelers and right behind the Green Bay Packers and Denver Broncos.

http://www.cbc.ca/sports/hockey/nhl/maple-leafs-top-forbes-list-of-nhl-franchise-value-1.2439946

List of all NHL teams:

http://www.forbes.com/nhl-valuations/list/


Simply put, the Leafs are an extremely highly-valued franchise. The maintenance of this value is best served by putting the best team possible on the ice. Burning $25 million in cash for Nathan Horton and ridding themselves of Clarkson and gaining the extra cap room is a very sound trade off given their valuation.

EDIT: I don't know how accurate these valuations are, but I'll assume they're at least somewhat reasonable.

The Jackets failure to insure a $40 million contract (Horton's) when their market value is estimated at $200 million is incomprehensible. The contract had a value of 20% of the team's valuation. The risk assessment skills of this management team are nothing shy of pathetic. Whoever made the final call on this situation is an incompetent who should not be employed in a managerial position with financial responsibilities. In any business.

 

[We Want Ten]

The biggest benefit for Toronto is a physiological/culture change. They seem to be going into a full rebuild and rightfully or wrongly Clarkson was viewed as part of the core that needs to be removed. He had become a lighting rod because of his production and the terrible almost unmovable contract that the TML gave him. Cap relief might have factored in, but no where to the extent that many seem to think. Toronto can only get cap relief if they are a cap team. If they truly are going into a full rebuild there is no chance they are going to be a cap team for the next 2-3 years and maybe even 4.

Wanna bet? Why else would they have made the move they did. It only makes sense if they plan on being a cap team so they can LTIR Horton. If not, they are exactly in the same spot as before, only without any on ice production. Ironically its the exact spot all the people supporting the move are slobbering all over themselves about from the CBJ POV.

 

[pete goegan]

... Ironically its the exact spot all the people supporting the move are slobbering all over themselves about from the CBJ POV.

Slobbering? I've seen a few people who are not completely negative about the trade, but nobody who is so wildly in favor that it could be characterized as that. Examples?

 

[1857 Howitzer]

Wanna bet? Why else would they have made the move they did. It only makes sense if they plan on being a cap team so they can LTIR Horton. If not, they are exactly in the same spot as before, only without any on ice production. Ironically its the exact spot all the people supporting the move are slobbering all over themselves about from the CBJ POV.

Yes I'll take that bet. As for why else they did it read my post.

 

[db2011]

Rebuild implies that something was built. This club is like that family that wins a small lottery jackpot and tries to build their dreamhouse, only to get the foundation dug and realize they are broke.

You mean the Johnsons?

 

[We Want Ten]

Yes I'll take that bet. As for why else they did it read my post.

I agree about the culture change aspect, but its more of Nonis finding a way to fix a huge error he made. If the Leafs were not planning on being a cap team, there is no point in signing a guy that his only benefit is LTIR which is only valid if you're a cap team. The Leafs will be a cap team at some point, no club is gonna spend 30 mill to change the culture alone, there has to be another benefit.

 

[Bobcat110]

The Jackets failure to insure a $40 million contract (Horton's) when their market value is estimated at $200 million is incomprehensible. The contract had a value of 20% of the team's valuation. The risk assessment skills of this management team are nothing shy of pathetic. Whoever made the final call on this situation is an incompetent who should not be employed in a managerial position with financial responsibilities. In any business.

 

[We Want Ten]

Slobbering? I've seen a few people who are not completely negative about the trade, but nobody who is so wildly in favor that it could be characterized as that. Examples?

I admit to taking some extra liberties with slobbering. My apologizes.

 

[SuperGenius]

http://www.cbc.ca/sports/hockey/nhl/maple-leafs-top-forbes-list-of-nhl-franchise-value-1.2439946The Jackets failure to insure a $40 million contract (Horton's) when their market value is estimated at $200 million is incomprehensible. The contract had a value of 20% of the team's valuation. The risk assessment skills of this management team are nothing shy of pathetic. Whoever made the final call on this situation is an incompetent who should not be employed in a managerial position with financial responsibilities. In any business.

Let's not forget that none of us understands one iota of insurance options with NHL teams and players. Seems likely there's a lot more to this than the team simply being cheap. I know this is the internet, but it might be fair to wait until we know more before crucifying the management team.

 

[We Want Ten]

You mean the Johnsons?

Ouch lol.

 

[1857 Howitzer]

I agree about the culture change aspect, but its more of Nonis finding a way to fix a huge error he made. If the Leafs were not planning on being a cap team, there is no point in signing a guy that his only benefit is LTIR which is only valid if you're a cap team. The Leafs will be a cap team at some point, no club is gonna spend 30 mill to change the culture alone, there has to be another benefit.

At some point yes they will be a cap team, but no way they will be in the next few years if they truly are rebuilding.

 

[niflheim]

IMHO Horton degenerative spine disease is very disputable. How much this disease is sport related? It more genetic, than acquired or professional disease. In Horton case our owner, presidents, gm in very honorable position because we paid for non professional disease. We are small, but good organization! Reputation always > $$$

 

[We Want Ten]

At some point yes they will be a cap team, but no way they will be in the next few years if they truly are rebuilding.

In the East, how much difference is their between rebuild and playoff contender?

 

[We Want Ten]

Let's not forget that none of us understands one iota of insurance options with NHL teams and players. Seems likely there's a lot more to this than the team simply being cheap. I know this is the internet, but it might be fair to wait until we know more before crucifying the management team.

I don't see how it can be anything other than cheapness or incompetence, or both. Really if you can't insure the guy, you don't sign the guy.
Also, i'll hold my breath on hearing the FO or the Dispatch clear this up for us.

 

[Cyclones Rock]

Let's not forget that none of us understands one iota of insurance options with NHL teams and players. Seems likely there's a lot more to this than the team simply being cheap. I know this is the internet, but it might be fair to wait until we know more before crucifying the management team.

We know this:

The NHL has a league-wide insurance plan that covers the clubs in case a player suffers a long-term injury or is disabled. After a player misses 30 consecutive games for the same injury, a team can apply for insurance and be reimbursed 80 percent of that player’s salary — a program the Pens could have tapped each of the last two seasons to get back much of Crosby’s salary.

Underwriters, however, may move to exclude payment to the Pens for any future head or neck injuries Crosby might suffer. Such exclusions are allowed under the NHL’s multi-year policy that is overseen by New York-based BWD Group and underwritten by MetLife.

While no player can be totally excluded, the insurer can specify a pre-existing condition that won’t result in a payout — or at least a full payout — if the same body part is re-injured, Marc Blumencranz, executive vice president and CEO of BWD Group, told FOXSports.com. (Blumencranz noted that he’s speaking on injuries in general, not specifically about Crosby.) There is a limit to the number of exclusions underwriters can claim league-wide.

http://www.foxsports.com/nhl/story/...ract-pittsburgh-penguins-nhl-insurance-062812

What we don't know is the timing mechanisms about when an insurer can opt out for a specific player. We also don't even know if the insurer opted out on Horton.

I doubt that we'll ever get the straight scoop on the specifics of this situation.

I also doubt that if we do that the CBJ management team will look very good.

Unless CBJ management comes out with a solid and reasonable explanation, then I will feel quite justified in hammering upon them.

 

[Cyclones Rock]

It’s already getting more expensive to insure players.

The NHL requires teams to insure roughly 80 per cent of the value of their top five player contracts through BWD Group, a New York insurance company. Rates have more than doubled from about 2 per cent in 2004 to more than 5 per cent of a contract’s value, Hubbard and others said.

That means it can cost a team about $250,000 to insure a player — one with a blemish-free medical history — with a $5 million contract.

http://www.thestar.com/sports/hocke...ruin_nhl_teams_if_insurers_pull_coverage.html

The article is from 2012, so there could have been a change on the stipulation of insuring a top contract.