If Varlamov would waive for the Leafs, the teams would need to find a 3rd team to take on Mrazek. No way the Isles take that salary for 2 more years since they want to compete next year and are in a cap crunch already. The big problem is, most of the teams who would trade for cap space are cap-floor teams, Mrazek is owed more than his cap hit the next 2 years.
That said, I would think something like:
To Tor: Varlamov, Chara 50% retained
To NYI: Dermot, Tor 1st 2022, Tor 3, 2023
To Det: Mrazek, Col 2 2022
I figure Varlamov gets a first, Dermot and a 3rd are for the Isles 2nd to dump Mrazek and Chara (worth a late pick).
Dermot gives the Isles some inexpensive depth at LD that they need for next year. He doesn't get a lot of ice time in Toronto and with Muzzin coming back they can get by without him and Chara can be the 7th D. Also, the salaries end up pretty much a wash a that point, leaving Toronto with the space to add another defenseman elsewhere.