I am still confused about the salary and cap hit. Hoopsworld and Spotrac list the cap hit for Lin and Asik as about $8.3M per year but the actual salary is $5.1M + $15M. So does anyone know what happens to this in the event of a trade?
Larry Coon says the following:
Putting this all together, if a team that is $9 million under the cap in 2011-12 wants to submit a four-year offer sheet, and wants to provide a large raise in the third season, they can offer a total of $36 million over four years. The first-year salary is limited to the Non-Taxpayer Mid-Level exception, or $5 million. The second-year salary will be $5.225 million (4.5% raise). This leaves $25.775 million to be distributed over the final two seasons of the contract, with a 4.1% raise from year three to year four.
For the team making this offer, this contract would count for $9.0 million (i.e., the average salary in the contract) of team salary in each of the four seasons if they sign the player. If the player's prior team matches the offer and keeps the player, then the actual salary in each season counts as team salary. The player's original team is allowed to use any available exception (e.g., the Non-Taxpayer Mid-Level or the Early Bird) to match the offer.
This addresses the difference between resigning a player you already have vs. signing with a new team and using an available MLE slot. Nothing about what happens if traded.
The Celtics may not mind that they have to pay an extra $4M as a hidden (non-cap) cost if they see value in two young players. I would like to see the Celtics get more than just Lin and Asik (adding Parsons would definitely win me over) but I definitely think there is a potential deal here that involves Rondo and maybe even Bass.
I don't completely understand why this is the case but I have read it over and over which makes me believe it is so. Had New York or Chicago matched the offers they would have been on the hook for $15 MM in the last year. However, when they signed with Houston, the money got distributed evenly.
Basically its because of the
Gilbert Arenas rule.
Asik/Lin both were second year rookies who were FAs as their contracts were up. But they were not UFAs due to not having enough service time in the league
But the Knicks/Bulls didn't have bird rights (need 3 years of service to a team/contract) so they can't use that exception to get around the cap.
So if a team is under the apron they are protected with salary limits for the first two years limited to the MLE (so teams can retain 2nd roun picks) in the third/fourth year the salary can escalate up hugely.
This is to keep the system of rookies being cost controlled for four years, after that they can be paid the really big bucks.
The averaging happens so that teams can't just offer big poison pill contracts without cap space. So to offer 9 million on average over 4 (or 3) years to a Gilbert Arenas RFA you have to have 9 million dollars in cap room. Thus the cap hit is amortized over the length of the deal.
A matching team isn't afforded this luxury as they're using the MLE and then paying the actual amount, just like if they were a first round rookie whom you signed to a standard contract (with 2 years locked in, 2 options and then you have to pony up)