I'm not asking "what do you do/who replaces" because I think there's nobody better out there. I am asking because I don't see a trade. No one wants him. And if you send him down, the goalies who would come up are both hurt. If you send him down and try to trade picks or whatever for another goalie, or sign a goalie whose languishing in free agency, you have to fit them and Smith's unburied salary under the cap.
So the only immediate solution I see is to put him at the end of the bench.
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