In hockey, a buyout is when a team agrees to buyout the contract of a player. They pay the player one-third (if they are under 26) or two-thirds (26 and older) of the contract’s value over two times the length of the contract.
Buyouts allow teams to gain cap flexibility in the present. The biggest concern is that the player’s cap hit doesn’t stop after the original contract would end. Instead, the cap hit stays on the books until the two times the original contract’s length is finished.
The New York Rangers already used a buyout this offseason on Dan Girardi.