Hoops Rumors Glossary

Usually, teams can begin signing players to 10-day contracts on January 5th each year. Since tomorrow is a Sunday, the NBA will wait until Monday, the next business day, to renew the annual tradition of the ultimate on-the-job tryout in professional sports.

The 10-day contract has been the foot in the door for several players who’ve gone on to lengthy, successful NBA careers, like Anthony Mason, Bruce Bowen, Raja Bell, Kurt Rambis, Howard Eisley and several others. More recently, C.J. Watson saw his first NBA action on a pair of 10-day contracts with the Warriors in 2008, and he’s since blossomed into a premier backup point guard, having signed a two-year deal for about $4MM with the Pacers this past summer.

Ten-day deals also help veterans make comebacks. Chris Andersen languished in free agency for sixth months after the Nuggets used the amnesty clause to get rid of him, but a pair of 10-day contracts with the Heat kick-started a revival for the Birdman. He wound up signing for the rest of the season and played a key role on Miami’s championship team before landing much greater security with a two-year contract this past summer.

Similarly, former first-round pick Gerald Green had been out of the league for three years when he made a splash during his pair of 10-day deals with the Nets in 2011/12. That earned him a contract for the rest of the season, and he parlayed 12.9 points and 48.1% shooting in 25.2 minutes per game for the Nets into a three-year, $10.5MM contract with the Pacers the following summer.

Still, the 10-day is usually a fleeting glimpse at NBA life for players on pro basketball’s fringe. Only a fraction of last year’s 10-day signees remain in the league, as I noted earlier this season. Hunter Atkins of The New York Times followed another Nets player who signed a 10-day contract in 2011/12, chronicling Andre Emmett‘s brief return to the NBA. Lee Jenkins of Sports Illustrated took a similarly revealing look at the life of Zabian Dowdell as he tried to make the most of a 10-day with the Suns three years ago.

Teams can sign a player to as many as two 10-day contracts before committing to him for the rest of the season, or, as in many cases, turning him away. Clubs can terminate a 10-day contract at any time if they no longer want the player around. Ten-day deals are almost always for a pro-rated portion of the minimum salary, though agents and teams are free to negotiate the financial terms.

Usually, teams only have one player on a 10-day contract at a time, though they’re allowed to carry as many 10-day contracts as they have players on the inactive list. If a team has 13 players on the active list, it can carry one more 10-day contract than the number of inactive players it has, meaning a 15-man club could have as many as three guys on 10-day deals.

The 10-day salaries, however small, count for cap and luxury-tax purposes, so a team like the Celtics, who are perilously close to the tax threshold, may be wary of bringing anybody aboard by this method. Other teams may make liberal use of 10-day deals. The taxpaying Heat signed four players to a total of seven 10-day contracts, both NBA highs last season. The Mavericks came closest to matching that as they scrambled in vain in make the playoffs, inking four players to six 10-day deals.

Veterans who have recently been released from NBA teams, like Lou Amundson, Hilton Armstrong and Mike James, figure to draw consideration for 10-day contracts, as should notable players who’ve gone unsigned this season, like Richard Hamilton, Mickael Pietrus and Daniel Gibson. Recent D-League signees Terrence Williams, Von Wafer and Chris Smith could all see their way back to the NBA via 10-day contracts. NBA neophytes could merit 10-day deals, too, and many of them will be showing off to scouts at the five-day D-League showcase starting Sunday.

All season long, you can keep tabs on 10-day signings with the Hoops Rumors tracker. If you click “Filter,” you’ll see a menu of options that can display customized lists of 10-day signings dating back to the 2006/07 season.

Note: This is a Hoops Rumors Glossary entry. Our glossary posts will explain specific rules relating to trades, free agency, or other aspects of the NBA’s Collective Bargaining Agreement. Larry Coon’s Salary Cap FAQ was used in the creation of this post.

A version of this post was initially published on January 5th, 2013.

The collective bargaining agreement limits the flexibility teams have to sweeten their offers to free agents. Trade kickers are one of the few tools that clubs have at their disposal, and they’re often written into contracts. Formally known as trade bonuses, they represent extra cash that players receive in case their teams trade them.

One rule regarding trade kickers changed in the 2011 CBA. For contracts signed since the new CBA took effect, the bonus must be paid by the team that trades the player, rather than the acquiring team. Sometimes the kicker is a fixed amount, but usually it’s based on a percentage of the remaining value of the contract. So, a player who has a 10% trade kicker is given 10% of the amount of money he’s yet to collect on his deal.

The value of a trade kicker declines each passing day during the season, since the amount the player gets for the current year of his deal is prorated. In a hypothetical scenario, let’s say the Cavaliers trade Anderson Varejao today. There are 137 days left in the 170-day season, including today. The commensurate amount left on Varejao’s $9,036,364 salary this year is $7,282,246. Added to the $4MM in guaranteed salary he’s set to make next season, Varejao’s 5% trade kicker would net him an extra $564,112.

Regardless of whether the trade kicker is set at a fixed amount or a percentage, the bonus can’t exceed 15% of the remaining value of the contract. That means that if a set amount of $1MM would equal more than 15% of what the player is owed, the kicker would pay out less than $1MM in the event of a trade.

Trade kickers don’t do much to help the most well-compensated players. The bonus can’t push a player’s salary above the maximum salary, even if the player is already making more than the max. Pau Gasol has a 15% kicker in his deal, but his $19,285,850 salary this season is already more than the $19,181,750 maximum for a player with 10 or more years of experience, as he has. That means the trade kicker is void, and Gasol wouldn’t receive any extra money if the Lakers dealt him away.

Similarly, players on rookie-scale contracts can’t make more than 120% of the scale amount, so if a first-round pick negotiates a trade kicker into his rookie deal, he can’t wind up making more than 120% of the value assigned to his draft slot. This rarely happens, though, since first-round picks generally wind up with contracts worth 120% of the slot value anyway.

The amount of the kicker that’s applied to a team’s cap is spread out equally over the remaining years of the contract. So, if a player with two seasons left on his deal were due a kicker worth $1M, the team obligated to pay it would take a cap hit worth $500K in both of those seasons, regardless of whether the player’s salary is different in each of the two years left on the deal.

However, if a player has years on the deal that are partially guaranteed or non-guaranteed, the cap hit is apportioned based on the guaranteed money in the deal, excluding all option years. So, if a two-year contract is fully guaranteed this year and 50% guaranteed next season, two-thirds of the kicker would apply to this year’s cap and one-third of it would be on next year’s cap. If the contract is non-guaranteed next season, the entire trade kicker would hit this year’s cap.

Other notes on trade kickers:

• Player and team option years don’t count toward the value of a kicker, unless the option has already been exercised.
• Years following early-termination options do count toward how much the player receives via the kicker, even though they don’t count toward the team’s cap hit.
• Incentive clauses don’t figure into the value of a kicker, which is calculated using a player’s base compensation only.
• Players may waive any amount up to the full value of the trade kicker to facilitate a swap, if they wish. However, players can’t change the amount of their trade kickers to allow a deal that would otherwise put a hard-capped team over the tax apron, even if everyone involved in the deal wants that to happen. Such a trade is simply illegal.
• For salary-matching purposes in trades, the kicker counts for the team absorbing the player, but not for the team that trades him away.

Note: This is a Hoops Rumors Glossary entry. Our glossary posts will explain specific rules relating to trades, free agency, or other aspects of the NBA’s Collective Bargaining Agreement. Larry Coon’s Salary Cap FAQ and ShamSports were used in the creation of this post.

This post was initially published on December 9th, 2012.

During NBA regular seasons, teams aren't permitted to carry more than 15 players on their rosters, except in rare instances. Generally, when a club with 15 players on its roster acquires a new player, it must waive someone to clear a spot.

In the offseason, however, teams are permitted to carry up to 20 players on their rosters. One club taking advantage of that extra flexibility this summer, as it did a year ago, is the Houston Rockets — last offseason, even after Houston hit the 20-man limit, the club continued to pursue free agents. This time around, the Rockets have 19 players lined up for training camp, and continue to be linked to additional targets.

Many of the Rockets' players are on partially guaranteed or non-guaranteed deals, making it virtually certain that most of those extra bodies will simply be waived before the regular season begins, so that the team can reduce its roster to the in-season limit of 15 players. However, Houston (or any other team) is allowed to carry more than 15 guaranteed contracts until the season starts, if it so chooses.

For instance, when the Suns sent Caron Butler to the Bucks in exchange for Ishmael Smith and Viacheslav Kravtsov, it increased Phoenix's total guaranteed contracts to 17. Since then, the team has released Michael Beasley, but at least one player with a guaranteed deal will have to be traded or waived before the season begins. In all likelihood, the Suns will have to release a player, then continue paying the player's full-season salary, given the guaranteed nature of his contract.

Before the season opens, teams like the Rockets and Suns, who are carrying more than 15 players, will be required to make cuts. However, other clubs may have to worry about meeting the roster minimum, rather than getting below the maximum.

The fewest number of players an NBA team can have on its roster during the regular season is 13, a figure exceeded by all the league's clubs at the moment. Still, not every team is carrying 13 or more guaranteed contracts. Several teams have 12 players on guaranteed contracts, while the Sixers, Bulls, Cavaliers, and Lakers only have 11. That means players with partially guaranteed or non-guaranteed contracts on those clubs have a decent chance of obtaining roster spots, as their teams attempt to reach the 13-player regular-season minimum.

A few more notes on NBA roster sizes:

• In the lockout-shortened 2011/12 season, NBA teams were allowed to have 13 active players, rather than 12 active players with at least one on the inactive list. This change became permanent starting in 2012/13.
• Teams are permitted to carry just 11 active players or zero inactive players for no more than two weeks at a time. A team can also temporarily place up to four players on its inactive list (for a total roster of 16 players) with league approval in the event of a hardship. The injury-riddled Timberwolves took advantage of this opportunity last season.
• Players assigned to a D-League affiliate are automatically placed on their NBA team's inactive list.

Note: This is a Hoops Rumors Glossary entry. Our glossary posts will explain specific rules relating to trades, free agency, or other aspects of the NBA's Collective Bargaining Agreement. Larry Coon's Salary Cap FAQ was used in the creation of this post.

This post was initially published on September 10th, 2012.

While the term "designated player" may evoke thoughts of baseball's designated hitter rule, there really aren't any similarities. In the NBA, a designated player isn't chosen game by game. Instead, when a team makes someone its designated player, the move can have broad, long-lasting consequences.

A designated player is a former first-round draft pick who receives a five-year extension to his rookie-scale contract. Teams are allowed to sign players to rookie-scale extensions of up to four years as often as they want, but they can only sign one player to a five-year rookie scale extension for as long as that extension is in effect. So, the Wizards, who signed John Wall to a five-year extension in July, can't sign anyone else to a rookie-scale extension of more than four years until the summer of 2019, when Wall's deal expires. The five-year deal makes Wall the team's designated player. That means the Wizards will be limited when they negotiate with Bradley Beal or any other player on the team's roster who can become eligible for a rookie-scale extension before Wall's deal is up.

There are ways the Wizards could get around this, of course. They could trade or release Wall, since he'd cease to be the Wizards' designated player if he's no longer on their roster. That's unlikely to happen. A much more plausible scenario involves the Wizards simply letting Beal hit restricted free agency in 2016, and signing him to a five-year deal then.

Wall signed for the max, and the designated player rule requires that contracts be for the max in at least the first season. The salaries can decrease by as much as 7.5% of the first-year salary each season, providing some measure of flexibility in the total value of the deal. The Bucks and Larry Sanders are closing in on a four-year, $44MM extension, a below-max deal overall. If they wanted to add a fifth year to the arrangement, front load the deal and bring the total value to $58,230,313, they could do so, triggering the designated player rule for Sanders. When I examined the prospects for a Sanders extension, I figured his agent would ask for a fifth year, particularly since the Bucks don't have any former first-round picks on their roster who figure to warrant such a long-term deal when they become extension-eligible. It looks like Sanders won't get that fifth year, perhaps because the Bucks want to retain flexibility in case they find other worthy talent in the next two drafts.

Teams that have designated players do have the option of trading for another team's designated player. So, the Wizards, in theory, could trade for Blake Griffin, the designated player of the Clippers, at some point during the life of their respective extensions. The Wizards couldn't, however, trade for both Griffin and another designated player, such as James Harden. The notion that Washington or any club could put together such a superteam is a little far-fetched, but the stipulation that no team may trade for more than one designated player is in place nonetheless.

The designated player rule doesn't apply to veteran extensions, and it doesn't apply to second-round picks or undrafted players. So, if the Rockets want to sign Chandler Parsons to a five-year extension when he becomes eligible next summer, they can do so without making him their designated player, since Parsons was a second-round pick. Nikola Pekovic's new five-year deal with the Wolves doesn't make him the team's designated player for two reasons: he signed it once his original contract expired, so it's not an extension, and that original contract was for only three seasons, which made him ineligible for an extension anyway.

Not every team has to have a designated player, and few teams do, in part because the designated player rule came into being only recently, when the new collective bargaining agreement went into effect in 2011. Here's the complete of designated players:

• Russell Westbrook, Thunder (expires 2017)*
• Derrick Rose, Bulls (expires 2017)
• James Harden, Rockets (expires 2018)
• Blake Griffin, Clippers (expires 2018)
• John Wall, Wizards (expires 2019)

*— Kevin Durant also signed a five-year extension, but he did so before the new CBA took effect, so he was exempt from the designated player rule, allowing the Thunder to sign Westbrook to his five-year deal. 

Note: This is a Hoops Rumors Glossary entry. Our glossary posts will explain specific rules relating to trades, free agency, or other aspects of the NBA's Collective Bargaining Agreement. 

Larry Coon's Salary Cap FAQ was used in the creation of this post.

Few NBA players mature as quickly as Derrick Rose did. The Bulls point guard captured the MVP award at the age of 22 in just his third NBA season, and he did so on a contract that paid him $5,546,160 that year, far below his market value. He was, in a sense, the victim of poor timing as he produced such outstanding results while still on the restrictive rookie wage scale for first-round picks, but his eligibility for an extension just as the lockout hit gave the players association an unusual chance to bargain on his behalf.

The result is a stipulation, commonly known as the Derrick Rose rule, that allows a player on a rookie-scale contract to receive an extension with a starting salary of up to 30% of the salary cap instead of the standard 25% if he hits certain benchmarks. A former first-round pick can invoke the rule if he does any of the following while his rookie-scale contract is in effect:

• Win the MVP
• Make an All-NBA team twice
• Make the All-Star Game as a starter via fan balloting twice

The rule also applies to former second-round picks and undrafted players with at least four years of service, but the odds that any of them would meet one of the required benchmarks are slim.

Rose, with his MVP award in tow, signed his lucrative five-year extension with the Bulls in December 2011, shortly after the lockout ended. Still, he wasn’t the first to benefit from the rule named after him. The league decided to apply the rule to Kevin Durant‘s extension with the Thunder, even though that deal was signed a year before the lockout began. Rookie-scale extensions don’t take effect until a year after they’re signed, so Durant’s deal kicked in for 2011/12, the season following the lockout. Naturally, the league’s decision didn’t sit well with the Thunder, and in July 2013, the NBA voted to reimburse the Thunder for a portion of the difference between what Durant’s extension would have been worth without the Rose rule and the $89MM+ he wound up with.

While the Thunder agreed to Durant’s extension without knowing that the Rose rule would take effect, teams and players are never sure of the precise terms of a maximum rookie-scale extension when they strike a deal for one. That’s because the deadline to do so is October 31st of the year before the extension would take effect. The maximum starting salary in the extension is based on numbers that are determined the summer after it’s signed, so it’s common practice for the contracts to simply state that the player will receive the maximum, rather than specify an amount.

Rose represents a rare case of a player who had already met the requirements for a 30% max by the time he signed his extension. Others, like Blake Griffin, don’t do so until their fourth season, so teams and players can leave contract language open to allow for either the 25% or 30% max, depending on whether the player meets the Rose rule requirements in his final season under the original terms of his rookie deal. The Wizards have done so with John Wall‘s extension this summer, and last year the Rockets left the door open for James Harden to qualify for the 30% max, though he failed to do so. The Thunder went the other direction, specifying just the 25% max in Russell Westbrook‘s extension, a move that wound up saving them millions when Westbrook made his second appearance on an All-NBA Team in his fourth season.

Players can receive higher salaries under the Rose rule only if they sign extensions for at least four years, but they don’t have to be a team’s “designated player” to qualify. Teams can only sign one player coming off a rookie-scale contract to a five-year extension, and that player becomes known as the club’s designated player.

So, if the Wizards want to sign Bradley Beal to an extension in 2015, and Wall remains on the roster, they can’t give Beal a fifth year, but they can give him a starting salary worth 30% of the salary cap, even in the unlikely event Wall qualifies for the 30% max this season, too. (Wall hasn’t been voted to start the All-Star Game or selected to an All-NBA team, and since you have to do one of those twice to invoke the Rose rule, his only recourse is to win the MVP this season).

Also, the league uses a different salary cap figure to determine maximum salaries. That’s why, for instance, Griffin’s $16,441,500 salary for 2013/14 isn’t precisely 30% of the $58.679MM cap applied to team salaries this season.

Note: This is a Hoops Rumors Glossary entry. Our glossary posts will explain specific rules relating to trades, free agency, or other aspects of the NBA’s Collective Bargaining Agreement.

Larry Coon’s Salary Cap FAQ was used in the creation of this post.

The Mavericks centered their 2012 offseason strategy on one-year contracts, but owner Mark Cuban has said that won't be the case for 2013. Instead, Cuban pointed to the stretch provision as a tool that will prompt the team to sign free agents to long-term contracts, even if the plan isn't for those players to stick around until the end of their deals.

The stretch provision allows teams to spread the cap hit for a waived player out over several years. Under the previous collective barganing agreement, teams and players could agree to restructure the payment schedule for any money that remained on their contracts when they parted ways. If a team waived a player with two years and a total of $4MM left on his contract, the club might have a hard time convincing the player to agree to spread the payments out over a longer period of time. The player might take less total money if a significant chunk were handed out up front, but that would still leave a team with a heavy cap hit for a player it no longer had on the roster.

The current CBA solves that dilemma for teams. The post-waiver payment schedule is locked in for players who signed deals after the lockout. If a team waives a player in July or August, the team pays his remaining salary over twice the number of seasons left on the deal, plus one. So, for that player who's waived with two years and $4MM left on his deal, the team would pay him $800K each year for five years.

If a team waives a player in any other month, the team pays the salary for the current season as usual, then spreads out the remaining salary over twice the number of seasons left on the deal, plus one. So, if that same player with a two-year deal worth a total of $4MM wasn't waived until September, the team would be stuck paying him $2MM for the coming season, but the remaining $2MM would be spread out in equal payments of $667K over the following three years. This could make August 31st a key date in NBA offseasons going forward, as teams face decisions about the better method of paying off players they intend to let go.

Cuban spoke about signing free agents to four-year contracts, which would allow the payment, and the cap hit that goes with it, to be stretched over as many as nine years (though unless the team signs a player and waives him the same summer, the payment could only stretch across a total of eight years). If the Mavs were to waive Jose Calderon next summer, a year after they came to terms on to a four-year, $29MM deal, he'd only tie up about $3.1MM of next year's cap. That way, the Mavs could clear room to pursue one of the marquee summer of 2014 free agents. The danger would be in having money that lingers on the books for several years. That could add up if Cuban continues to pursue this strategy.

While the stretch provision regulates when money is paid out, it doesn't prevent teams and players from negotiating a reduced salary as part of a buyout. Non-guaranteed money isn't subject to the stretch provision either, since a team isn't obligated to pay any non-guaranteed portion of a contract once it waives a player. If another team claims a player off waivers, it inherits his contract, including the non-guaranteed portion, and his former team doesn't owe him anything.

Note: This is a Hoops Rumors Glossary entry. Our glossary posts will explain specific rules relating to trades, free agency, or other aspects of the NBA's Collective Bargaining Agreement. Larry Coon's Salary Cap FAQ was used in the creation of this post.

The NBA draft lottery, which is set to take place next Tuesday, is the league's way of determining the draft order and disincentivizing second-half tanking. The lottery gives each of the 14 non-playoff teams a chance to land one of the top three picks in the draft.

Although the top three picks of each draft are up for grabs via the lottery, the remaining order is determined by record, worst to best. The league's worst team isn't guaranteed a top-three spot in the draft, but has the best chance to land the first overall pick and will receive the fourth overall selection at worst.

The first three picks are determined by a draw of ping-pong balls numbered 1 through 14. Four balls are drawn, resulting in a total of 1,001 possible outcomes. 1,000 of those outcomes are assigned to the 14-non playoff teams — for instance, if balls numbered 4, 7, 8, and 13 were chosen, that combination would belong to one of the 14 lottery teams. The 1,001st combination remains unassigned, and a re-draw would occur if it were ever selected.

The team whose combination is drawn first receives the number one overall pick, and the process is repeated to determine picks two and three. The 14 teams involved in the draft lottery are all assigned a different number of combinations, as follows (worst to best):

1. 250 combinations, 25.0% chance of receiving the first overall pick
2. 199 combinations, 19.9%
3. 156 combinations, 15.6%
4. 119 combinations, 11.9%
5. 88 combinations, 8.8%
6. 63 combinations, 6.3%
7. 43 combinations, 4.3%
8. 28 combinations, 2.8%
9. 17 combinations, 1.7%
10. 11 combinations, 1.1%
11. 8 combinations, 0.8%
12. 7 combinations, 0.7%
13. 6 combinations, 0.6%
14. 5 combinations, 0.5%

If two lottery teams finish the season with identical records, each team receives an equal chance at a top-three pick by averaging the total amount of outcomes for their two positions. For instance, if two teams tie for the league's ninth-worst record, each club would receive 14 combinations and a 1.4% chance at the first overall pick — an average of the 17 and 11 combinations that the ninth- and tenth-worst teams receive.

If the average amount of combinations for two positions isn't a whole number, a coin flip determines which team receives the extra combination. For instance, if two clubs tied for the league's worst record, the team that wins the coin flip would receive 225 of 1,000 chances at the first overall pick, while the loser would receive 224. The coin flip also determines which team will draft higher in the event that neither club earns a top-three pick.

The table below displays the odds for each lottery team, rounded to one decimal place. For our purposes, the first seed is the NBA's worst team. Click to enlarge:

Note: This is a Hoops Rumors Glossary entry. Our glossary posts will explain specific rules relating to trades, free agency, or other aspects of the NBA's Collective Bargaining Agreement.

This post was initially published on April 25th, 2012.

The July moratorium is a period at the start of each NBA season during which teams aren't permitted to make trades or sign free agents. The specific dates vary from season to season, but for 2013, the moratorium will last from July 1st to July 9th. As of July 10th, teams can resume business as usual.

Each new NBA season officially begins on July 1st, which is also the day that free agents are freed from their previous contracts. However, before players can sign with new teams, the NBA must complete its audit, which establishes figures like the salary cap, luxury tax threshold, and average salary. Free agents are allowed to negotiate with clubs during the moratorium, and can agree to terms on new contracts, but they are unable to officially sign a new deal until the moratorium ends.

There are a number of types of signings that are permitted during the July moratorium, as follows:

• A first-round draft pick can sign a standard rookie scale contract with the team that drafted him.
• A second-round draft pick can accept the required tender, which is a one-year contract offer that allows a team to retain its rights to a drafted player.
• A restricted free agent can accept a qualifying offer from his team.
• A free agent can sign a minimum-salary contract for one or two seasons.

When the July moratorium ends, all free agents can officially sign contracts. Additionally, the new salary cap figures for the year take effect, and the seven-day amnesty period begins.

Note: This is a Hoops Rumors Glossary entry. Our glossary posts will explain specific rules relating to trades, free agency, or other aspects of the NBA's Collective Bargaining Agreement. Larry Coon's Salary Cap FAQ was used in the creation of this post.

This post was initially published on May 16th, 2012.

The mid-level exception is the most common way for over-the-cap NBA teams to sign other teams' free agents. The exception can be used every season and can be split among multiple players, but different teams receive access to different mid-level exceptions based on their cap situations.

A team whose total player salaries, cap exceptions, and cap holds amount to less than the salary cap forfeits its full mid-level exception. A taxpaying team also doesn't have access to the full mid-level. However, both under-the-cap and taxpaying teams receive a lesser form of the MLE. Here's a breakdown of the restrictions placed on each of the three forms of the exception:

For teams with cap room:

• Called the mini mid-level, or the room exception
• Maximum two-year contract
• Maximum 4.5% annual raises
• First-year salary grows by 3% annually, beginning at $2.5MM in 2011/12.

For over-the cap teams:

• Called the full or standard mid-level exception
• Maximum four-year contract
• Maximum 4.5% annual raises
• First-year salary grows by 3% annually, beginning at $5MM in 2012/13.
• Once used, the team cannot surpass the "tax apron" ($4MM above tax line) for the remainder of the season.

For taxpaying teams:

• Called the mini mid-level, or the taxpayer mid-level exception
• Maximum three-year contract
• Maximum 4.5% annual raises
• First-year salary grows by 3% annually, beginning at $3MM in 2011/12.

In 2012/13, the room exception was worth $2,575,000, the full mid-level was worth $5,000,000, and the taxpayer mid-level was worth $3,090,000. However, those values are all set to increase by 3% for the '13/14 season. Here's the maximum contract a free agent could receive this summer using each of these three forms of mid-level exception:

Note: This is a Hoops Rumors Glossary entry. Our glossary posts will explain specific rules relating to trades, free agency, or other aspects of the NBA's Collective Bargaining Agreement. Larry Coon's Salary Cap FAQ was used in the creation of this post.

This post was initially published on April 24th, 2012.