requently asked questions (FAQ) about future free agency.

If you have a question about future free agency, post it here and I will try to answer it.  I will be adding to this post periodically.

If you find any mistakes or bad links, please let me know.

What "governs" the the league, the owners, and the players?

The Collective Bargaining Agreement (CBA), which was agreed upon in 2005.  It expires after the 2010/11 season (the league has the option to extend it through the 2011/12 season).  The CBA may be terminated early:  LINK

Can the actual CBA be viewed?

Yes - LINK

What is the CBA FAQ?

An excellent summary of the CBA can be viewed at:

CBA FAQ

How is the salary cap determined?

CBA FAQ LINK

What is included in basketball related income (BRI)?

CBA FAQ LINK

What will the salary cap be for the 2010/11 season?

The salary cap for the last 4 years:

2005/06: $49,500,000

2006/07: $53,135,000

2007/08: $55,630,000

2008/09: $58.680,000

2009/10: $57,700,000

2010/11: ???

If the economy and the BRI continue to grow as they have in the past 4 years, the salary cap might be about $62,000,000 for 2009/10 and about $65,000,000 for 2010/11.  That is probably unlikely, however.

A more likely projection might be the economy (and the BRI) staying the same or decreasing somewhat, and the salary cap being $55 to $60 million for 2010/11.

What is included in Team salaries?

CBA FAQ LINK

What is a "Cap Hold"?

When calculating team salaries (for salary cap purposes), a percentage of the previous salary of unrenounced free agents is included - this is called a cap hold.

What will the cap hold for LeBron be summer 2010?

Assumimg that LeBron opts out summer 2010, his salary for 2009/10 will be $15,779,913.  From CBA FAQ LINK, his cap hold for the 2010/11 season would be his maximum salary for 2010/11.  The maximum salary for a 7 year vet for 2010/11 would be 30% of the salary cap.  Assuming a salary cap for 2010/11 of $60 million, the cap hold for LeBron would be $18 million and that amount would be included in our team salary.

The cap hold for Wade, Bosh, Yao Ming, Amare, and Joe Johnson for summer 2010 would also be $18 million (if they choose to opt out).

If LeBron either signs a contract extension or chooses to not opt out of the final year of his contract, his actual salary for 2010/11 ($17,149,244) would be included in our team salary for 2010/11.

Can we offer LeBron more money than any other team if he opts out in 2010?

Definitely yes.  The "home team" can offer their own unrestricted free agent the maximum salary for the first year and 5 more years with 10.5% raises each year and they can do that regardless of whether they have any cap space or not.  They would be using the "Larry Bird Exception" to do that.

Assuming a salary cap of $60 million for the 2010/11 season, we could offer LeBron a 6 year contract:

2010/11: $18,000,000

2011/12: $19,890,000

2012/13: $21,780,000

2013/14: $23,670,000

2014/15: $25,560,000

2015/16: $27,450,000

TOTAL: $136,350,000

Any other team (with at least $18 million in cap space for the 2010/11 season) could offer

2010/11: $18,000,000

2011/12: $19,440,000

2012/13: $20,880,000

2013/14: $22,320,000

2014/15: $23,760,000

TOTAL: $104,400,000

The "home teams" for Wade (Miami), Bosh (Toronto), Amare (Phoenix), Yao (Houston), and Joe Johnson (Atlanta) could offer the exact same 6 year contract to their free agents - the most we could offer any of these players (assuming we had the cap space) would be the "other team" 5 year contract.

Can LeBron sign a contract extension?

Yes.  LeBron signed a contract extension July 18, 2006 and can sign another extension 3 years after that date or July 18, 2009 (or later - up to June 30 2010).

CBA LINK

How can contract extensions be structured?

The maximum (overall) length of a contract extension would be 6 years, which would include the years left on the present contract.  The actual length of the NEW contract would be 4 years (maximum).  The final year of the new contract could have either a team or a player option.  Link

The maximum salary in the first year of the new contract would be 110.5% of the salary in the final year of the existing contract (not to exceed the maximum possible salary the player could receive if he were signing as a free agent).  Link

LeBron's present contract:

2009/10: $15,779,913

2010/11: $17,149,244 (player option)

A possible (maximum) contract extension:

2011/12: $18,949,914.62

2012/13: $20,939,655.66

2013/14: $23,138,319.50

2014/15: $25,567,843.05 (could be either a team or a player option)

What is a sign and trade?

CBA FAQ LINK

Under no circumstances can a team sign and then trade another team's free agent. But there is a rule that allows teams to re-sign their own free agents for trading purposes, called the sign-and-trade rule. Under the sign-and-trade rule, the player is re-signed and immediately traded to another team. This is done by adding a clause to the contract which stipulates that the contract is invalid if the player's rights are not traded to the specific team within 48 hours.

A sign-and-trade deal can be made even with players who have been renounced, but cannot be made when the player is signed using the Mid-Level, Bi-Annual or Disabled Player exceptions (the team signing the player must use Bird rights or cap space to sign the player). Sign-and-trade contracts must be for three years or longer, but only the first season of the contract must be guaranteed. The three year minimum (even though the last two seasons may be non-guaranteed) ensures that the new team will not acquire Bird rights to the player any sooner than if they had signed him directly, because they would have to waive him, after which they wouldn't be able to use Bird rights (see question number 25).

One complication with sign-and-trade deals is that the signed player can immediately become a BYC player (see question number 73 for more information on BYC), so the player's BYC value must be used when determining whether the trade is allowed.

Can the present CBA be terminated/changed?

YES.  Link

Nov 25, 2008 -- 12:49PM, wils wrote:

I've heard that if LBJ opts out for 2010 that we can resign him for more money than anyone else for some reason and that the amount of cap space doesn't matter for some reason? Is there any truth to this?

we can resign him for the most money mainly because we can give him a 6-year contract (i think worth around 135mio.) and the other teams only can offer 5 years. i'm not sure about the other thing but golfer probably knows the answer

Great information. Thanks for posting!

great info... thank u

Player Option / Early Termination Option / Team Option / Qualifying Offer / Non-guaranteed

* No Longer With Team
Delonte West receives $500,000 guaranteed if the team declines his 2010-11 option
Qualifying offers do not count towards the total team salary for that season and are informational only.