It’s useful to think of buyouts as a last resort for NHL teams. A route to be considered only when all other options have been exhausted.

The NHL’s buyout device is limited in utility and scope, but in a hard cap league with guaranteed player contracts, it’s one of the only routes NHL teams have to fix their mistakes on their own without needing to rely on a willing trade partner or a fortunate waiver claim by a rival club.

When a contract is bought out, teams remain on the hook — in terms of both cap charges and salary — for two-thirds of the total value of the deal (or one-third of the total value of the deal, provided that the player being bought out is younger than 25) stretched out over twice the originally agreed upon term of the contract. Signing bonus money isn’t subject to the NHL buyout mechanism, adding a further limitation to an “ordinary course buyout.”

Once a contract is bought out, the cap charge associated with that decision is immovable and permanent. No matter how inefficient a player contract is, it can (at least theoretically) be moved. A bought-out cap charge, however, is fixed on a team cap sheet.

At some point between June 15 and June 21, the NHL buyout window will swing open. Any action that occurs in the NHL’s first buyout window, however, will typically wait until closer to the closing of the window on June 30.

Because the buyout is such a firm, inflexible thing, NHL teams typically prefer to use all of their allotted time to first try and identify a trade partner for a “problem” contract prior to exercising a buyout. This is the option of last resort, a fallback route to carve out cap space, a break-glass-in-case-of-emergency cap-saving device to be used as rarely and as judiciously as possible.

Given that the NHL and NHLPA have yet to formally set the upper limit of the salary cap for the 2023-24 campaign, forecasting the 2023 buyout window is an unusually tricky exercise this offseason. Based on NHL commissioner Gary Bettman’s recent commentary, it’s expected that the upper limit will be set at $83.5 million, although there’s apparent interest from all sides (provided it doesn’t increase the player’s escrow rate) in figuring out how to raise that number before the new league year begins.