Vanbiesbrouck, who has already resigned his position as the Greyhounds coach and general manager, is eligible to apply for reinstatement in five years, but most observers agree his career in hockey is over.
The former NHL goaltender plans to sell his 25 per cent stake in the team, which was fined $50,000 by the league.
"It is imperative that the Ontario Hockey League make a strong and unambiguous statement to the effect that any statements or comments of this nature will not be tolerated by the league," said OHL commissioner David Branch in a statement released on Wednesday.
Former NHL goalie John Vanbiesbrouck, seen in this 1996 file photo, played junior hockey with the Greyhounds. (CP Photo)
Last week, Vanbiesbrouck admitted he used the "N word" when referring to Daley while at the billet residence of two Greyhound players.
Upset by his team's effort after a 6-1 loss to the Guelph Storm, Vanbiesbrouck criticized Daley, who is black, in front of forwards Mike Amodeo and Jeff Doyle
Vanbiesbrouck admitted to using the slur "several times."
Daley quit the team Saturday after being told of the incident. The 19-year-old defenceman returned home to Toronto temporarily before deciding to re-join the team.