The talk around the Golden Knights’ offseason has revolved around the big names and fan favorites. What happens with William Karlsson, Deryk Engelland and Pierre-Edouard Bellemare? Will there be a major trade or free-agent signing? What will the roster look like next year?
He may not come to mind much when thinking of offseason moves, but the Golden Knights have no shortage of possibilities when it comes to defenseman Nick Holden. And some of those involve things the team has never done before.
The Golden Knights could keep Holden or they could trade him. They could also look at his production last year and decide to move on from his contract, either by burying it in the AHL or making him the first buyout in team history.
This is not to say the Golden Knights intend to rid themselves of Holden’s contract. There are other ways to make cap space and may decide they are happy with keeping the last year of his deal at a manageable hit.
And the easiest solution would be to keep him. Holden is 31 years old and has played at least 54 games since he became a regular with Colorado in 2013. He signed with the Golden Knights in July, and the results were mixed.
Holden played 61 games this year, tallying three goals and 15 points playing third-line minutes. He played most of his time with Jon Merrill, with significant chunks of time with Colin Miller and Shea Theodore.
Holden spent time on injured reserve in February and was a healthy scratch for six of the seven games in the playoffs. He was on the ice for 2.65 goals per-60, and the team save percentage with him on was .904, worst among team defensemen at 5-on-5, according to naturalstattrick.com. He started in the offensive zone fewer times per-60 than any other defenseman, but was middle of the pack for most offensive stats.
The Golden Knights also have a surplus of talent on the blue line, with Theodore, Miller, Nate Schmidt and Brayden McNabb all signed to multiyear deals. Jon Merrill has one year left, Engelland is an unrestricted free agent who could still come back, Jimmy Schuldt is due for a new deal and Nic Hague, Zach Whitecloud and Jake Bischoff are waiting in the minors. That plays against Holden, competing with up to 10 other defensemen for playing time.
If the Golden Knights do decide to move on, below is an explainer of how that could work, with numbers and calculations from capfriendly.com.
Holden signed a two-year deal last July with an average annual value of $2.2 million. That is his cap number for both seasons of the contract. He had a $2.6 million salary this season, and will have a $1.8 million salary next season, which is important for both buyout and contract-burial purposes.
If Holden is on the Golden Knights next year, is traded or is claimed off waivers, he will count $2.2 million against the cap and his team will owe him $1.8 million. He is signed to a one-way contract, meaning his $1.8 million salary does not change no matter which league he plays in.
The Golden Knights have never used a buyout, but the numbers play in their favor if they choose that route with Holden.
There are more weedy details, but the basics of a buyout is that it saves the team up to two-thirds of a player’s cap hit while spreading out a balance over a length of time equal to double the number of years remaining on his contract. So if a player with one year remaining on his contract is bought out, he counts against the cap and collects money for two years at a reduced rate.
It gets a little more complicated if the player’s salary does not equal his cap hit or if he is under 26 years old, but it equals savings now for dead cap hit money later.
A player first needs to be placed on waivers and, if he clears, is bought out and becomes a free agent. The buyout period begins either June 15 or two days after the Stanley Cup Final ends, whichever is later, and lasts until 2 p.m. June 30.
Burying a contract in the AHL follows a simpler formula. A team receives cap relief equal to the player’s cap hit minus the league-minimum salary plus $375,000. Holden’s cap number is $2.2 million, and the minimum NHL salary next season is $700,000. Add it up, and the Golden Knights can bury $1.075 million, meaning if Holden spends the year in the AHL his cap number would be $1.125 million. That only applies to the cap, not money paid to the player.
So which option would be more advantageous? That depends on what the Golden Knights are looking for.
If they want the maximum savings, they would buy him out. A buyout would make his cap number $1 million for next season and $600,000 for 2020-21, as well as pay him a $600,000 salary each of the next two seasons. It would save them $600,000 in both cap space and salary over the next two years, though it would have them pay him and take a cap hit in 2020-21, a year after his current contract expires.
If the Golden Knights are not concerned about total money and want to be rid of his contract at the end of the year, they’ll bury the contract in the AHL. They would gather no salary relief but would gain $1.075 million in cap space for next season, and the team’s obligations would end when his current contract does. This also gives Vegas the flexibility to call up Holden if the need arises. The cap is calculated on a day-to-day basis, so any time in the AHL would still save the team money against the cap.
The Golden Knights have plenty of choices. They’ve never used the buyout and no one with a significant salary had his contract buried at AHL Chicago last season.
There will be plenty of tough conversations around the Vegas roster this season, and it remains to be seen if Holden is one of them.